Bangalore: R. Chandrasekaran, president and managing director, global delivery, Cognizant Technology Solutions Corp., speaks after the company’s September quarter earnings announcement. Edited excerpts:
Do you think Cognizant will be able to continue operating in your stated band of 19-20% non-GAAP (generally accepted accounting principles) operating margins, or do you see pressures there going forward, especially if the competition decides to start sacrificing margins?
We will be very comfortable there. It is a winning formula for us. And by constantly reinvesting excess in our delivery, innovation, and thought leadership, we are able to keep improving margins, so I don’t see any pressures at all.
R. Chandrasekaran. File photo
As for the competition, I would characterize dropping of pricing especially as an act of desperation, though I am not seeing too much of that yet. After all, clients are not looking to just cut costs, but are looking for innovation and thought leadership on the revenue and value side.
How does Cognizant see the macroeconomic challenges?
For us, it is opening up a lot of opportunities. For our clients, operating in an uncertain environment is the new normal, and that is how we see it, too. They want to respond better, and there we are helping big time. Regulatory changes, structural changes in the operating environment, and cyclical pressures are all part of this new normal.
While the client intimacy approach you follow is another component of your success, does this, at all, prevent you form stepping back and engaging at a truly strategic, transformational level?
Not at all, 50% of our consulting is at the strategic level. Our end-to-end capability, the trust and confidence that we gain from our customers help us deepen our relationship and partner with them at all levels, and move up the value chain. Our clients know us as someone who practises what we preach.