Rajan Kohli is quite possibly one of the coolest and calmest global leaders in today’s services industry, at a time when the speed and the pace of change bounce between hot and scalding. Are things moving as fast as clients want? And what about the internal pace of change? Wipro has recently completed both a major restructuring under new CEO Thierry Delaporte and the eye-catching acquisition of Capco in the past few weeks, so how are they really pulling it together to deliver the value clients so urgently seek?
Rajan now leads Wipro iDEAS (Integrated Digital, Engineering and Application Services), one of the firm’s two new global business lines, so I spent some time with him to wade into those waters…. after his daily run through Central Park. Here’s a peek into the conversation…
Phil Fersht, CEO and Chief Analyst, HFS Research: It is great to have you back on here again Rajan. I think we last spoke on HFS about three or four years ago, so quite a lot has happened since then with you, your career, and with Wipro. For the benefit of everyone here, maybe you could just give us a rundown on yourself again, and where you have evolved from, to the position that you are in today. Then we can talk a bit more about how you are hoping to take things forward in the new setup at Wipro.
Rajan Kohli, President and Managing Partner, Wipro iDEAS (Integrated Digital, Engineering, and Application Services Business Line): Absolutely. The pleasure is all mine, Phil. I think, when we last spoke, I had just taken over as the leader of Wipro Digital, and Wipro was making a big bet on digital in that space. Prior to that role, I was head of banking and financial services, and before that, I had been the Chief Marketing Officer at Wipro. But most of my time had been in leadership roles in our financial services business. We set up Wipro Digital in 2014, and I’d been leading Wipro Digital until a quarter back.
If you remember, Phil, our initial hypothesis was that in Wipro Digital we’ll develop capabilities that are differentiating, capabilities that don’t currently sit in any part of Wipro, and then, over a period, we’ll move other parts of Wipro under Wipro Digital so that we can do an end-to-end digital proposition for our clients. And that is the journey we were on.
“Through the massive restructure that Wipro had… we added the digital experience parts of Wipro’s business into Wipro Digital, then we added application modernization. With this latest reorganization, Wipro has now added all of engineering, all of applications, all of data also under this new group called iDEAS.”
Earlier this year, through the massive restructure that Wipro had, we have continued that journey forward. Initially, we added the digital experience parts of Wipro’s business into Wipro Digital, then we added application modernization. With this latest reorganization, Wipro has now added all of engineering, all of applications, all of data also under this new group called iDEAS.
The new global business line of iDEAS consists of Wipro Digital, Apps and Data, and the Engineering and R&D business of Wipro. We have also brought Industry Domain and Consulting under the iDEAS business line.
This is now the new construct, where we have two global business lines, iDEAS, and the second one is called iCORE, which is infrastructure, operations, and cybersecurity.
Phil: So it has obviously been quite the year now. We have been operating in a work-from-anywhere scenario quite literally, and I think a lot of the theory and desires that we spoke about over the last decade, some of that is now coming into practice for many enterprises, for many of our own companies, and into our own lives.
What do you see is the real speed between the desire for change and the actuality of the pace of change in the market? Are things moving as fast as clients want, or are you seeing a mismatch between what people want to get to versus where they are heading?
Rajan: That is a very good question. I think all our clients, enterprises, post-COVID, want to move much faster. They want to do more digital, but the gap between their desire and ability is what I will call digital fitness. It is comparable to having a desire to run 100 meters in 10 seconds, but not having the capability to do that. The gap really is fitness.
“All our clients, enterprises, post-COVID, want to move much faster. They want to do more digital, but the gap between their desire and ability is what I will call digital fitness. It is comparable to having a desire to run 100 meters in 10 seconds, but not having the capability to do that. The gap really is fitness. …Those who had modernized their IT application and infrastructure were able to achieve much more.”
I think the realization is there, among our clients now, that they need to modernize the core to really become a digital enterprise. That came to the fore during COVID because, if you talk to most of the CEOs and CIOs, the biggest issue was the IT, the application, the legacy nature of the landscape, and just the sheer amount of effort and time it took to do simple things. Those who had modernized their IT application and infrastructure were able to achieve much more.
There are good examples of enterprises that were able to pivot very fast. Best Buy was able to offer curbside pick-up very quickly, and Target could do a lot of omnichannel business. Chipotle – their stock did really well because they were able to order on their app and offer pick-up from the stores. A lot of enterprises took advantage of the scenario to gain share. There were many others who suffered, and that is the difference that I call digital fitness.
Phil: I think you have had your own shift in strategy, Rajan, where you have moved much more in a geolocation strategy model than maybe what you were doing before. How do you think that is going to go as you work through a lot of change with your clients as well?
Rajan: I think the current model of geo-based structure is a good one. I will tell you two or three reasons why I believe it is a really good one.
“The industry definitions of the past no longer really hold true. … For us to be able to serve our clients the best, it is better to organize against a particular account and bring all of the Wipro value proposition into the account, irrespective of the industry boundaries of the past.”
Number one, if you really see, the industry definitions of the past no longer really hold true. If you look at Amazon, of course, it is a favorite example of all. Is it a tech company? Is it a retail company? Is it a delivery & logistics company? It is all, right? Similarly, if you look at Zillow, they want to compete on the buyer journey, so why would they not want to offer mortgage loans, if possible? Do they now become a financial services company? Look at Walmart, they want to get into banking and financial services. For us to be able to serve our clients the best, it is better to organize against a particular account and bring all of the Wipro value proposition into the account, irrespective of the industry boundaries of the past.
Secondly, through this reorganization, Phil, we have brought our accounts and account management team closer to the customer. Client relationships were reporting level four or level five below our CEO. Now, they are on level three, and some on level four, and so we have brought ourselves closer to the client.
While we have become regional, we also need to stay global, because we do not want our capabilities to get siloed. So, the global business lines are truly global. iCORE and iDEAS are two global business lines that give us the ability to learn something, to deliver something in one client, in one region, and then replicate it in another client, in another region. That is why I like this construct a lot.
Phil: In terms of internal transformation, as a OneOffice type of organization, I know there is a lot of work going on internally to really pull that together, as well. Can you talk a bit more about what you are doing internally to, sort of, reformat the whole way Wipro is operating in this economy?
Rajan: I would say two things, Phil. First, in the past, there were a lot of operations that were sitting outside of the service lines and were being centrally managed. Now all of that operational capability has been brought into the service lines. Service lines now can decide how much they want to hire, where they want to hire, at what price they want to hire, and equally how they build talent in-house. A lot of that decision-making has been given to them.
Second, for us to now operate this model, we need a much better fabric that connects our accounts and our business lines. [We] really have a very strong order-to-cash system which, by the way, also can be flexible as we integrate many of the acquired companies into our system. So, if company A has a particular rhythm, which is different from company B, we should be able to offer that through the flexibility in our system.
We have a program called Quantum, Phil, which is being led from the top of the company, and that is the fabric that will now connect us in this new organization.
Phil: Excellent, Rajan. So, what about the conversations we are having now? I mean, there was so much focus on digital before the pandemic hit, in terms of a lot of focus around design, interface, and almost advertising-type businesses, as we were taking enterprises through that journey. But has that conversation shifted, in the last year, in terms of what the top priority is now? Is it maybe not quite as important as it was?
Rajan: Well, there are things that probably have become more important now that were not as important in the past. Modernization is one of them.
In the past, modernization was seen as IT’s requirement. It was not seen as a business requirement, because the functionality did not change. Business always worried about paying for modernization, because they paid for features and benefits, and modernization is more speed. They did not see the importance of it. Post-COVID, I think they have realized the need for speed, and hence the modernization, so that has changed.
“What has changed is Cloud. Pre-COVID, cloud was still important, but people were looking at cloud as more of an infrastructure-as-a-service play, a cost reduction play, or a flexibility play. Post-COVID, it is a play for speed as well.”
Second, what has changed is Cloud. Pre-COVID, cloud was still important, but people were looking at cloud as more of an infrastructure-as-a-service play, a cost reduction play, or a flexibility play. Post-COVID, it is a play for speed as well. We see clients realizing that a cloud-based environment offers them the ability to go live faster and better with their new features to market. I think that cloud has become a lot more application and domain-centric, compared to just pure infrastructure-centric, and we are seeing that shift, post-COVID.
And last but not least, in the immediate aftermath of COVID, everything was about access, “I need to reach my employees; I need to reach my customers; how do I do that?” A lot of spend went in that direction, but now it is about a sustained performance. I think that journey obviously was always going to be a little short-lived, because people have achieved what they needed to achieve in the first six months, and now they are looking for more sustainable differentiation, post-COVID.
Phil: As we look at this great return-to-work that is going to hopefully unfold in the next few months, maybe six to nine months, how do you see that taking shape? Are you seeing us going back to similar office-based scenarios as before, or something very different happening? We have seen Unilever, we have seen Amazon, and Microsoft,… a lot of companies come out and declare that they are now work-from-anywhere/work-from-home businesses and that they are relying less on real estate and things like that. Do you see a different scenario unfolding as we watch a return-to-work happening?
Rajan: Yes, I do not expect us to go back completely to the pre-COVID scenario. I believe this is one of the positive effects of COVID, and a lot of that will stay. Just think about it today. You know, over the last nine months, almost 90% of our workforce has been working from home, yet we are delivering on our SLAs, clients are happy with us, and they are giving us more business. You saw our results over the last quarter – we are growing. I believe a lot of this will stay.
But we are in a services business, which means that a lot of our ability to work from home is also dependent on our clients’ decision-making, so to that extent, we will be dependent on what decisions they make. I have absolutely seen many of our clients that have made long-term announcements around not doing more than 50% from the office, so we will stay connected to that.
On our shared staff, or back-office staff, who are either not directly managed by the client or not directly delivering work for our clients, we expect a vast majority of them to continue to work from home partially. So, they will work a week from home, come to the office a couple of days, then work a week from home, etc. I think it will evolve, but it will not come back to where it was in the past.
Phil: Yes, I think our data is telling us something similar. I think only a third are looking at a complete return, and most are looking at, as you said, a different, more phased, hybrid model as we evolve. Does that change how you look for talent, the types of people that you are looking for, in your own organization, your own areas, and maybe your client areas as well? Are your needs shifting now? Are you looking for a different profile of people than you were?
Rajan: Yes, we are looking for a different profile of people. It is not just to do with post-COVID work from home, but over a period, this shift has been happening. Hence, we are looking for people who have greater learnability. Very clearly, we cannot define where technology will go two, three, four years down the line. People need to be responsible for their own destiny, so they also need to have learnability; they need to be able to pick up new skills.
The second is collaboration, and that part is now even more important. Because we are working from home, remotely, via video conferencing, the skills that you require to engage with people and collaborate are a little bit different, and even more relevant than in the past. Collaboration is thus important.
“Diversity has always been important, but one thing that both COVID and the movement in the US have brought forward, particularly over the last six to nine months, is the fact that diverse teams are necessary. Within Wipro, we have doubled down on diversity with very, very specific initiatives to drive diversity at the leadership level.”
Third, diversity. Diversity has always been important, but one thing that both COVID and the social justice movement in the US have brought forward, particularly over the last six to nine months, is the fact that diverse teams are necessary. Within Wipro, we have doubled down on diversity with very, very specific initiatives to drive diversity at the leadership level. Even if you see some of the recent hires we have made at level one, which is CEO minus one, and level two, CEO minus two, they come from all walks, and bringing more women into leadership is very important.
Phil: Yes. And you see this return to work evolving, and maybe the removal of borders in businesses now. They are far more globalized.
You made an acquisition recently of Capco, Rajan, which is the largest acquisition I think Wipro has made. There seems to be a lot of focus around building out more client-side onshore competency now in the system, as well. Is that part of the thinking, globalizing the model?
Rajan: Yes, globalization of the model was a journey we were on over the last couple of years, especially as you move upstream. As you move more into the consulting and the design phase, we needed more globalization.
“Capco, which is the largest acquisition Wipro has ever made, helps us… fill the continuum of think it, design it, build it, done it – that end-to-end continuum. We will continue to move and localize, and not just in these countries but also other delivery locations globally, outside of India.”
Capco, which is the largest acquisition Wipro has ever made, helps us do that, and helps us fill the continuum of think it, design it, build it, done it – that end-to-end continuum. We will continue to move and localize, and not just in these countries but also other delivery locations globally, outside of India. Eastern Europe, for example, is of interest to us, and other [areas]. Mexico has been growing for us. We will continue to do that.
Phil: Right. So at a personal level, who have been the big influences in your life and career, as you have evolved? You have had a successful rise, Rajan, particularly in the last few years. Who would you credit for that, in terms of influencing your motivation or your viewpoints? Or, just in general, who helps drive your thinking?
Rajan: Yes, I would say two people. One, of course, my mother. My mother was a teacher. She really focused on imparting the right values in me, and I saw that in how she operated day-to-day.
“I have had the great privilege of working very closely with Mr. Azim H. Premji, Wipro’s founder, and seeing him in action. Anybody who has worked with him, even for a very short duration, would tell you that there is so much to learn from the great person he is,… and how willing he is to ask any question if he believes that can make him better and make the company perform better.”
And the second [influence], having spent 25 years in Wipro, I have had the great privilege of working very closely with Mr. Azim H. Premji, Wipro’s founder and seeing him in action. Anybody who has worked with him, even for a very short duration, would tell you that there is so much to learn from the great person he is, from how he carries himself, how humble he is, how he challenges himself, and how willing he is to ask any question if he believes that can make him better and make the company perform better.
Phil: Absolutely. And I was absolutely amazed at the level of personal investment he has made in India, its infrastructure, and also even in COVID relief. He has donated more money than many of the richest people in the world like Jack Dorsey at Twitter. They have not actually sacrificed as much investment in this as Azim Premji has.
I was quite amazed at how he runs a tight ship, both as a business and personally. He is an incredibly generous man, and I think a lot of that has gone unnoticed for a long time. He has done a lot to be very proud of, and his contributions to India, so I am not surprised to hear you say that he has been one of your influences there.
This has been really nice to catch up and see your personal successes, as well as Wipro finding itself with some good energy and direction coming out of this pandemic economy. I look forward to catching up with you in the not-too-distant future to see how the new acquisition, and maybe more acquisitions, are embedding, and how this global model is treating the company.
We really appreciate your time today, Rajan!