By Shravan Bhat| May 3, 2014
Syntel's Prashant Ranade talks about how investing in people and investing ahead of the curve helped the IT services company grow faster than a buoyant market
Profile: Executive vice chairman, Syntel
Career: Rockwell Automation; Siemens; Syntel since 2006
Education: BTech Engineering, IIT Bombay; MS, University of Cincinnati; MBA, Xavier University, Cincinnati
Interests: Travelling, playing golf, reading and listening to music
Q. What do you mean by ‘investing ahead of the curve’?
Syntel’s profit after tax for the year ending December 31, 2013, stood at $219 million. Growing profitability allows us to invest in our people, our campuses and presence around the world and our investments are driven by what current clients will be confronted with in the future. For instance, for almost all clients, the handheld device will be their new browser and that is going to change how applications are developed and rendered.
In our case, when the move towards open source software came about, there was a lot of discussion around it and we invested in ‘reporting’ capabilities. There were a couple of clients who were using proprietary software that they had licensed and they were rendering reports to thousands of their associates—the majority of whom were like me, who prefer to get a canned report relevant to me, as opposed to the ability to configure every report every day. You don’t really need so many people with access to that licence! By investing in open source software ourselves, we were able to save clients money and improve efficiency.
A longer term investment was for the move to cloud. We work with enterprise clients and private cloud is going to significantly change how each client operates. Everyone is looking at refactoring [restructuring] applications and taking them to private cloud. But in that process, while the hardware cost reduction is significant and clearly understood, the ability to effectively migrate applications is critical. We invested in tools which do code conversion, for instance, where we saw 30 percent reduction in time and cost when you refactor applications. Similarly, we developed tools to understand how to apply the ‘10 commandments of cloud migrations’.
Q. How have you invested in acquiring and developing talent?
The normal process of campus hiring is still there, but we partnered with a social media company and came up with a way to accept applications online, screen online and even before Day 1, we had over 50,000 applications. You would think companies in the tech space would have done it long ago. We were the first to do it. They [campuses] have a Day system where the bigger companies were ‘being the bullies’. How do you break that system? You appear for an online test—so we didn’t even need to go to campus! Eventually we had over 100,000 who registered and took our test online.
We have Syntel University where basic level courses are available online—not just technical, but concepts like ‘agile methodology’, which is more popular than ‘waterfall’. Over 4,000 individuals have already taken that online class, including my staff members! You can ask HR to shuffle people around, you can create the best learning environment, but eventually everyone is CEO of their career and self-help is the best way to develop professionally.
Q. Your European operations are growing, so why have you recently expanded into the Philippines?
Today, albeit from a small base, we have grown higher than the market and our growth in Europe has been higher than our own average. In Europe there’s acknowledgement on their part that they need companies like us as partners to improve their cost position and refresh/upgrade technology.
Just like India has been a powerhouse in terms of IT, the Philippines, because of language, accent, etc, has over 750,000 employees in a BPO industry contrasting to 3.5 million in India in IT. Our focus wasn’t pure BPO; ours is knowledge process and end-to-end process. But in the last 12 months, the Filipino economy has done well, it’s an easy environment to do business, plus they have decided to focus on improving technology knowledge, especially in IT. Lastly, within our five verticals, we have health care and life sciences where there are lots of Filipino doctors and nurses with education systems similar to the US. The Philippines has traditionally been a huge source of overseas labour in the paramedical field. The training is US oriented. It’s very similar to where India was 20 years ago. With economic opportunities opening up in the Philippines, lots of people have chosen to stay back and work in health care BPO because of their understanding of diseases and medical terminology. They already have infrastructure to churn our graduates with paramedical skills; we’re just using it in a different way!