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Lakshmi Narayan: Cognizant Technology
"It's a Tea Time with him"
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Our tete-a-tete with Lakshmi
Narayanan is at Chancery Pavillion, a business hotel
on Bangalore’s Residency Road. It’s the venue for a Nasscom event and
Narayanan, vice chairman of Cognizant, is the industry body’s chairman, ergo his
presence there is mandatory! He’s addressing a press meet too, hence a formal blue suit is his garb of choice for
the day.
We were to sit by the poolside but a rain shower forces us indoors. Bowing to
the elements we settle down in the coffee shop and Narayanan tells us how he’d had a tough time locating the
hotel on his way from the airport.
Surprising for a local boy, you might think, as Narayanan grew up in
Bangalore and lived there till his early twenties, which included studying at
RBNMS Ulsoor followed by St Joseph’s and Central College. But then
Bangalore has grown so rapidly and haphazardly in the past 10 years anyone
can be forgiven for losing their bearings in the city.
That said, Narayanan doesn’t really dig Bangalore.
"I prefer Chennai," he says frankly, "I love
the beach and I had bought a beach-facing property in Chennai even before we
started Cognizant!"
The waiter takes our order: cappuccino for me, filter coffee for him. I
wonder if Narayanan will like the hotel’s coffee, as he may be used to
the authentic version in Chennai...But after a few sips, Narayanan pronounces
it to be fine.
As Narayanan savours the coffee talk turns to the
fast rise of the rupee. Does the future of the offshore industry look bleak?
Narayanan chooses to answer that with an anecdote.
"I was talking recently to Mr Kohli (Fakir Chand Kohli, the first CEO of TCS and Narayanan’s first boss) who told me when he
ran the business, the exchange rate was Rs 8 to the dollar and TCS still made
money. "He feels companies are using the appreciating rupee as an excuse
for not being able to make money!"
"Of course I couldn’t tell him that salaries then were much lower...I am still very scared
of him," he adds with a chuckle. "I avoid talk like that, I don’t want to give my colleagues the
impression that they are talking to their grandfather!"
It is easy to understand why. Narayanan will turn 55 next year and joined TCS
at Rs 1,000 per month in 1976. The average age of an Indian IT professional
today is 27; and Cognizant’s starting salary is about
Rs 20,000 a month.
When he entered TCS right after finishing his MBA from IISc,
the company had only 240 people. “It was a very small business and wasn’t making any money. Mr Kohli used to say that
he was sent by the Tatas to close down TCS. JRD Tata was concerned that people were playing with
computers and not making money and didn’t want to invest anymore in TCS,” he recounts.
“But Mr Kohli
saw an opportunity and turned the business
around in three years. The only help he wanted from the Tata’s was to allow TCS to
computerize the entire group. ” Today TCS is
the largest IT services company in India with over
95,000 employees.
“The offshoring industry was created by TCS — there’s no doubt about
that”, says Narayanan with obvious pride.
It was TCS, he says, that taught him all he knows about computers. He was
with TCS for 18 years and left only because he began to feel stifled. “I felt I could do more”, he says. So, in 1994 Narayanan quit to start Dun & Bradstreet’s captive centre (which later became Cognizant) as Chief Technology Officer.
“It was an opportunity to create
a new company, which was free and did not have the same problems as TCS,” he says. In the first three years, 60% of Cognizant’s managers came from TCS. Defining the culture, therefore, was a
challenge.
D&B had come to India as Satyam’s client, and the captive
unit had three different kinds of people, from
D&B, Satyam and TCS. The second problem was
that competition was already well entrenched by the time Cognizant was
started.
“Different companies have
different positions, TCS wants to lead by size, Infosys
has chosen branding and Wipro wants to be the
leader in R&D,” says Narayanan.
Cognizant decided to make customer focus as its differentiating factor. It
was also the glue that fused the company together. “It developed a competitive spirit in our people. Even today when we make it to a final shortlist, very
rarely do we lose” says Narayanan confidently.
Last year Cognizant crossed a billion dollars in revenue and is now one of
the fastest growing offshore IT services company. It made some bold moves,
including the decision to not get into BPO like many of its peers. “BPO does not fit with our strategy,” avers narayanan. “We are okay with leaving that
pie of the business on the table. We recently had a strategy session and our
customers categorically said they do not want to buy that capability from us.”
This January, Narayanan handed over the CEO’s reins to 38-year-old Francisco D’Souza.
“I’ve run this
company for the past 12 years, though I had the CEO title for the last two
years only,” says Narayanan, on stepping aside
though the company was doing so well under him. There’s another reason too.
“TCS was next to the
government in terms of bureaucracy, so when Cognizant was created we put the
retirement age at 55,” he reveals. “ If you haven’t accomplished anything
by 55 in this industry, you’d better call it quits!”
Hiring younger leaders is also a business imperative
these days. “The young have no fear, they don’t know what is impossible.
That’s the culture we want to build in Cognizant,” he asserts. He first met D’Souza when the latter was only 25 and had just joined Dun & Bradstreet. Even back then, Narayanan says, he
knew D’Souza
would be a leader one day. “D&B had a fantastic way of identifying talent and nurturing
it. They marked Francis as a leader, out of 40,000 people, very early on,” he says and narrates an incident, which proves D’Souza’s mettle.
“In 1994 we couldn’t
get a local connection to VSNL despite waiting for several months.
Frustrated, Francis called up the CEO of VSNL in the middle of the night
complaining bitterly about the delay. The CEO heard him out patiently and
promised to look into the matter. Within a few hours someone from VSNL
Chennai called us and our problem was fixed,” laughs Narayanan. Talk about being pro-active!
By now, both coffee and time have run out. A parting question on what he will
do once he retires from Cognizant is irresistable.
Narayanan says he hasn’t thought of it as yet. At
the moment his hands are full with his
responsibilities at Cognizant and Nasscom.
The extra time will mean more travelling with his
wife Lakshmi (they share the same first name!) and
daughters Anusha (22) and Revathy
(18). The family loves travelling and takes at
least two holidays every year. And no, Bangalore’s traffic choked streets may not be on
the itinerary.
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