A former GE veteran, Tyagarajan is leading Genpacts transformation from a business process management services provider to an all-round IT player with consulting and IT-enabled services among its portfolio. Its seven acquisitions over the past two years are proving handy in this exercise. In a chat with BWs Venkatesha Babu, Tyagarajan outlines Genpacts edge over its peers as well as the journey so far and ahead. Excerpts:
Are Genpacts recent moves an effort to build an end-to-end services portfolio?
Our objective is not necessarily to be seen as a full-services company. We do not want to define ourselves based just on the range of services we offer. Our challenge is to enable our clients to become intelligent enterprises built on processes.
Our acquisition strategy is not based on portfolio expansion alone. That is too simplistic and only incidental. Acquisitions are driven by what our client and market requirements are. Our Headstrong buy was not about buying technology. We wanted to work with investment banking and capital market clients. Remember, we did not have even one of them as a client just five years ago. Headstrong gave us access to those set of clients plus the culture matched. We do a call on build or buy we buy as it helps increase our speed of the go-to market, otherwise we have been growing organically. For instance, our trademarked framework around Smart Enterprise was developed in-house. The other part is that enterprises have access to lots of data, which is easily storable. They are keen on getting actionable insights from that data, which is what we deliver.
How different is Genpacts narrative from other major players?
Genpact has been doing data analytics now for 13 years. Because of our legacy, and that we were a part of GE for close to seven years, we have done that from the beginning unlike some others who have started doing it now. It is ingrained into our DNA. From financial services, consumer packaged goods, pharma, retail, manufacturing and so on, we have done this across industries. The maturity and depth across our services lines is unparalleled. We grew up with processes as our legacy and heritage. Clients remark about our culture, which is fairly unique and give us an edge. Our domain expertise, our processes and our culture is what sets us apart from competition.
Your margins are average compared to some of the tier 1 India-based players. By pushing for more IT services business, are you looking to improve that?
In the medium term, we would like to keep margins stable because in some of the market segments we operate in, we are at the beginning of a long-term secular growth cycle, barring the temporary turbulence. So, even if we get more margins through improving productivity, we would like to utilise some of it to invest for long term growth in 3-4 areas. We will invest in global growth by setting up more delivery centres across the world, such as the ones we just opened in Dubai and Brazil and the one we are examining in Colombia. Second, we will hire more industry and domain experts. We will invest in creating new products and platforms. We will enhance our investment in training.
The challenge continues to be how to keep adding value to our customers. We want to tap into China as a key market,which is today less than 10 per cent of our revenue.
(This story was published in Businessworld Issue Dated 20-02-2012)
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