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Business News/ Companies / People/  We still need to crack the code in China: N. Chandrasekaran
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We still need to crack the code in China: N. Chandrasekaran

Chandrasekaran says the company's digital drive continues to pay dividends, both for TCS and its clients

N. Chandrasekaran, CEO and managing director, Tata Consultancy Services Ltd (TCS). Photo: Hemant Mishra/MintPremium
N. Chandrasekaran, CEO and managing director, Tata Consultancy Services Ltd (TCS). Photo: Hemant Mishra/Mint

Mumbai: N. Chandrasekaran, chief executive officer and managing director of Tata Consultancy Services Ltd (TCS), remains bullish about the prospects of TCS, India’s largest information technology (IT) services provider. On Thursday, the company reported sharp increases in fiscal first quarter profit and revenue, beating analysts’ estimates. In an interview on Friday, Chandrasekaran said he believes growth has returned to the US and UK economies, the main markets for IT firms, even though he is still cautious about the Indian market’s growth prospects. He added that the company’s digital drive continues to pay dividends, both for TCS and its clients. Edited excerpts:

Would you say that happy days are here again for the Indian IT industry, and that companies will be able to beat (industry body) Nasscom’s fiscal year 2015 revenue growth forecast of 13-15%?

I will be in a better position to comment once all the fiscal first quarter IT results are declared. That said, the asking rate of 13-15% is difficult for many companies. Nasscom speaks to all companies before giving the estimates, so I would not want to second-guess that.

So what’s working for TCS? You have done well in most countries...

I think we are executing well and finding the right opportunities, and the markets are doing well too. In terms of specific geographies, good growth has returned to the US and UK, and we continue to diversify in other markets.

How have smaller geographies fared for you?

While the Middle East, Africa, Latin America and India are very important to us, we have to get the right business mix and scale up. We have taken care of Australia and Japan, but we still need to crack the code in China and also build a strategic presence in other Asia-Pacific markets like Malaysia, Indonesia, China and Hong Kong.

In India, specifically, what opportunities do you see with the new Narendra Modi government coming to power and providing a push to technology in the Union budget?

The India pipeline is still not that strong. We are definitely looking to engage more, and we are closely watching for all these technology initiatives to mature into programmes and we are looking at opportunities from them. We also have a very strong government portfolio in India, and are in talks with entrepreneurs here.

TCS appears to have made great strides in the digital space...

The progress is very good. We are seeing a number of engagements, as well as the size of them increasing. Accordingly, we are doing projects in omni channels, analytics, Big Data platforms and a variety of engagements, which are part of an overall, orchestrated digital initiative in our client organizations, and spend on digital transformation will only increase going forward.

Your company has crossed the 300,000 employee organization mark, making it one of the largest employers. At the same time, non-linear (not headcount-related) growth is becoming important. How long will it be before we see a clear 70:30 or 80:20 ratio mix between linear and non-linear initiatives?

We are following both linear and non-linear strategies. Even if non-linear picks up, I don’t want to let go of linear growth, as we have good talent available and we are able to manage both. We like to keep the flexibility. We also have a fantastic training programme for freshers, whom we are actively hiring. We believe we are investing ahead of the curve since the last two-three years, and we have still been able to capture deals and execute.

TCS today has 100,000, or slightly over 32% of its total workforce, women employees. But there is no woman director on the board...

We had a woman director who retired and now we are on the lookout for a replacement.

In the light of TCS becoming a force to reckon with among the top global companies, what are you doing in terms of managing cultural diversity?

We have more than 110 nationalities in the company today and have local teams in all the geographies where we operate. These employees all have the same TCS values and TCS way of doing business instilled in them.

Attrition has been higher for two quarters, mainly on the BPO (business process outsourcing) side. Any specific concerns on the BPO front?

The attrition rates have not been very high, so there is nothing to worry about. Besides, some amount of attrition is always required.

How sustainable is TCS’s high growth momentum? Is the market valuation of your company right?

While we can’t comment on how the markets work, we are always looking at further opportunities, customers, better financial results and managing employees. We are thus confident of high growth momentum continuing.

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ABOUT THE AUTHOR
Leslie D'Monte
Leslie D'Monte specialises in technology and science writing. He is passionate about digital transformation and deeptech topics including artificial intelligence (AI), big data analytics, the Internet of Things (IoT), blockchain, crypto, metaverses, quantum computing, genetics, fintech, electric vehicles, solar power and autonomous vehicles. Leslie is a Massachusetts Institute of Technology (MIT) Knight Science Journalism Fellow (2010-11), author of 'AI Rising: India's Artificial Intelligence Growth Story', co-host of the 'AI Rising' podcast, and runs the 'Tech Talk' newsletter. In his other avatar, he curates tech events and moderates panels.
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Published: 19 Jul 2014, 12:42 AM IST
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