- Everything's global
- The quest for improvement has never been as intense
- The tolerance for inefficiency has never been as low
- We need to re-define our own roles in this environment
The opportunity for the service providers to help enterprises and their key talent achieve progress across these four factors is undeniable: some will step it up and become true consultative partners for their clients, while others will remain where they are and hope customer requirements will never really change. Tomorrow's winning enterprises already know what they have to do, and they need service partners who can help them achieve their goals.
In order to help us grasp how the global provider community is responding to this new relentlessenvironment, we have engaged a number of CEOs of the leading providers to share with us their frank views of the changing world, how they survived the Recession, and how they intend to shape their businesses to support tomorrow's winners.
To begin this series, we caught up with Genpact's President and CEO, Pramod Bhasin, and are delighted to feature some his thoughts from a very engaging discussion...
Phil Fersht: Good evening Pramod – thanks for taking time out to talk with Horses for Sources. Can we start by discussing Genpact’s approach to the recession and measures you took to get through the worst of it?
Pramod Bhasin: Our background as a company with GE (General Electric) really helped us. Especially their picking up signs that there was major problem ahead of us, frankly, in the last quarter of '07. Seeing the nervousness in customers, the nervousness in the pipeline, and talking to those in our industry, all whom were a little jumpy about this. We at once began to put a lot of action into this, in fact, quite early in '08. Clearly discretionary spending, etc. are all things that we stopped.
More importantly, from a customer perspective, we actually upped the ante and invested a lot more in getting better business development people onboard, getting stronger presence in the European market, actually putting more people out on the street in terms of talking to customers etc., as we felt that the worst thing we can do at a time of recession is pull back. Instead, we have to move ahead even more aggressively to capture, perhaps, other things that others may have left for us, as well as to make sure that customers understood that we were there with them. In many cases, we were willing to help, perhaps in helping them in projects by arranging a model of work that showed them that we were aligned with their goals.
There was a very positive effort to over-invest upfront and over-invest in managing the relationship in working with our current customers, which I think that this allowed us to hold the dam during that time. Otherwise, I think our results would have been worse.
Phil: So you used the recession to get closer to your existing clients?
Pramod: Absolutely. We actually sent a pin-point message out there some time in the middle of ‘08 that said a variety of things out of concern, like get closer to your customer, spend more time with them, invest more in business development, cut back on discretionary costs, focus on cash flows, and so on. We were ready for margin cuts also because we knew that others would come after us on price. But we were ready to tackle price with promises of full volume, come up with monthly billing structures, we changed some of ways we were billing with customers so that we could lessen some of the upfront blows that we know they would have otherwise seen from an outsourcing initiative.
Phil: How did you reinvest in the business in the last year, and how will this bear fruit in the forthcoming months?
Pramod: Our European and UK operation has more than doubled our business development headcount, and our pipeline is up by more than 75 percent. In addition, we have added more domain-specific people in the US in certain areas such as financial services, mortgages, loan modifications (and things like that) healthcare upping people by 25 to 30 percent in the US itself. We made more investments in China and in India, in new businesses that we wanted to purse. So it is pretty much all around the world, Phil. We felt very strongly that it was a great time to diversify to into other geographies that we may not have touched.
Phil: Where are the new opportunities for Genpact? Where are you doubling-down?
Pramod: A bunch of stuff is happening. Companies that needed to restructure have done so. People are more secure about their jobs - that in itself had posed a lot of problems for people. If people are that insecure, they are not about to make any more moves. In addition, IT spending is back somewhat, it is not fully back yet, but its back.
We are seeing a lot more traction in terms of mining new business with existing customers who are saying, “We know where we are at. The market seems to have bottomed out. Let’s get on with it. Let’s do what need to do to get our cost-base changed to adapt to the new reality.” So, that process is actually moving ahead pretty well.
We’re also diversifying quite well – our India business is growing at 100%, and I have just came back for an exhilarating trip in the Middle East and Latin America, which I think which I think offers tremendous opportunity for us which we will go to. Along with that are new areas where we are building our real expertise; for example healthcare, and our process capabilities in terms of what we are able to do to in terms of driving efficiency and effectiveness for companies across the board. All of those things are begining to play out very well.
Phil: In terms of the culture of Genpact emerging from the recession, what would you say has changed and what would you do differently in retrospect?
Pramod: There was a lot of learning, some good and some not so good, frankly. I think that we realized that we have to be a lot more commercially savvy, because companies were pressurizing us for price so on and so forth. I think that we could have come off potentially with different structures to solve some of those issues.
I think the need for (what I call) consultative selling and real expertise we can take to a customer, is very significant at these times. They want real solutions. The same old solution won’t work. So, you really have to have a way within your organization to help people find their solutions and to help them "think" into customers in a way that is different and meet their needs. Customers want to convert capital costs into operating costs. They want to reduce transition times. They want to reduce upfront costs. They need to figure out how to manage change. So out of the recession I am very certain that expectations have hit a completely different level.
Customers are clearly saying, “Bring me real expertise because I am hurting very badly, and I don’t want to hear same old, same old. I need real expertise and creative solutions.” That’s tough for companies like us with our mass of people, so that is something that we have to learn to do much better.
In the next part of this interview, Pramod discusses the competitive landscape, the development of new BPO delivery models and gives some practical advice for young executives. Stay tuned...
Pramod Bhasin (pictured above) is President & CEO, Genpact. Pramod established Genpact (formerly GE Capital International Services) in 1997. Pramod was earlier an Officer of General Electric (GE). His career with GE and RCA spanned 25 years across the US, Europe and Asia. He was most recently the head of GE Capital in India and in Asia, having earlier worked with GE Capital's Corporate and Finance Group in Stamford, Connecticut, USA. You can read his full bio here.