Q: You have talked about wanting to build an aggressive company?

A: Very often what happens is that you articulate a vision and you think a lot of work is going on along that vision. When I articulated our vision about iTOPS and adopting transaction pricing model, effectively it meant that we are participating in some risk with our customers. At the same time, one cannot end up wanting to do only the regular cookie cutter kind of deals. One of my concerns is that we have gone a far way, away from our ability for multiple people in the company to take risks, try something new and different.

Unfortunately, the culture that was created earlier was one where the cost of a new initiative not paying off was significantly higher than the benefit of it paying off.

I am going to change that culture to one where the benefit of a risk taken, if it pays off, is significantly and dramatically higher than the cost if it does not come off. And if you do that, then you have a self-sustaining, innovation engine in the company, where people will be encouraged to take risks knowing that if it pays off, it will be a huge thing. And if it does not pay off, they will not get completely beaten up. That’s the dramatic difference I am talking about which will make us a lot more revenue- and business- friendly company.

Q: Every organisation’s growth path can be traced back to its CEO and his vision. Was the culture that existed beyond your control and something that you could not change because you were a listed company?

A: I agree that an organisation should be traced back to the CEO and I take responsibility for anything in the company. However, the fact is that if you have people whose culture is very different from yours and it starts telling glaringly, that’s when the changes have to start getting named. And I don’t spend all my time in India. Therefore, unfortunately, it is not just a single influencer on the culture and it becomes multiple influencers.

Without ensuring that there is complete alignment on vision, values and culture, the organisation ended up with some mixed messages. I wanted to correct that and become more aggressive and risk taking.

Q: How do you that?

A: Through a combination of having people who have a greater alignment with my thinking and me spending a little more time here in India.

Q: Have you laid out any rules/framework for this new culture?

A: A basic and important framework, something that was against my thought process, was we had identified things that people could do. I want to actually switch it around. As per the new framework, one can do everything except a few things.

Hence, now there is only a short list of things one cannot do. I don’t want people to ask me for any decision because one should be knowing more about some things than me and hence should be willing to make a decision. So we force a culture of empowerment, enablement and innovation, down the line.

A lot of this has started happening. This is what I call Adult-to-Adult employee-employer engagement model. I only tell them as to what is to be achieved and they figure out as to what to do and how to do. And I finally want to see if I can evolve iGATE to a company, whose handbook which I loved and respected (which was Nordstorm).

In 1992-93, the CIO of Nordstorm gave me an employee handbook in 1992-93 which said: Rule No. 1: Use your good business sense in all situations and Rule No. 2: There are no more rules.

That is what I want to try and get to. I don’t want to tell people what and how it should be done. This is a services company. It is all about intellectual capital, which is unleashed by getting everybody to be passionate, getting their creative juices going and getting their thinking caps on rather than showing up for work in the morning and going back home in the evening.

Q. You have steadied the boat somewhat in the last few years. Hence are the changes that you are looking at much easier to make now than before?

A: I think we needed to have some kind of stability and growth in profits. When you are making losses, it is difficult to experiment, which was the case when I came into iGATE four years ago. Now it is very different. Our profits and margin structures are starting to look best in class in mid caps and we are also starting to knock on the doors of the large caps in terms of margin structures and profit expansion.

This allows us to put something back in the pot for people to experiment with and allows us the opportunity to make some mistakes with the probability of much more aggressive successes. One has to respect the fact that when we are going for aggressive successes, there could be mistakes and you have to allow for that. And these few mistakes could cost. However the flip side is that the benefits could be much higher than the mistakes.

Q: What is your take on the markets outside US?

A: North America continues to be a growth engine for iGATE. I am seeing good visibility for us in the next 2 quarters and there is no let-up in projects. We were the earliest entrants into Japan. We have about 15 big customers in Japan, most of whom are large household names in the country and we will continue to grow there. Beyond Japan, traction for iGATE is good in Australia. We see a big market for our iTOPS offering in Australia and will be targeting F500 accounts there with our iTOPS and Enterprise solutions.

Drivers in the Australian market will be a continuing boom, shortage of quality talent and increasingly cost conscious companies who are looking at output-based pricing (iTOPS). This is a big advantage for us and clearly sets us apart from competition.

Being an early entrant, we have built critical mass and hence we are well poised to leverage that advantage.

Q. In a products business it is easier to see a slowdown immediately than in a services business, where there seems to be at least a 6 week lag. Your view on that.

A: The theory is that you first buy hardware, then software and only then services. To that extent, I would agree that the application products and the hardware guys might see the trend a little earlier. But I want to clarify that I don’t think we are talking about trends based on what we are seeing. We are talking about trends based on what companies are telling us about the whole year. We have got a sense from the clients that they are spending money and initiating projects. And hence this is not like the 2001 slowdown, where things just fell off the cliff.

Q: iGATE’s pipe line for the year?

A: Visibility and our profit expansion are looking good. While we are gaining a lot of visibility, there is uncertainty about the staffing services piece. My immediate worry is about that. Our iTOPS strategy is helping us with our profit expansion and we are pleased with that, especially at a time when everyone thinks margins are getting squeezed.

Q: Employee initiatives at iGATE

A: The big ticket item for us from an iGATE perspective was that a lot of the employee initiatives we started earlier this year have come to some sort of public approval. We are the only company to have performed consistently well in all the three surveys. We were No. 3 in DQ-IDC survey, No. 6 in BT-Mercer survey and No. 1 in CNBC survey. This shows that if you have a more mature adult-to-adult engagement model with employees, they will start seeing the results. Too often, in India, many companies work on an adult-to-child engagement model. Our model is the ability to enable and encourage employees to take their own decisions and risks, which I think has caught the eye of the surveys.

When you are trying something new, the employees look for reassurance rather than the person who is trying something new. The award itself means a lot less to me than the fact that the employees feel that this model is validated by others. For example: I was pleasantly surprised that we got an award from Mysore Horticulture Society for being the greenest campus, which we are interpreting as the most eco-friendly campus.

We do some things because we believe in it. I believe that the resources of the world are getting depleted faster than it should be and therefore treatment of waste, recycling, recharging water table, having oxygen surplus plants in your campus are good things for productivity. While I am happy with the awards, the employees are a lot happier because of the external validation that it gets.

Q: What about the validation of iTOPS

A: We have recently won a number of deals in iTOPS. We are looking at multiple areas where we are expanding the iTOPS model. We have been able to extend the iTOPS model to insurance, leasing and tenancy bond agreements. I am very happy that we are ahead of competition. What I spoke about as iTOPS four years ago, the competition is now talking about as platform-based BPOs. I believe because more and more people are offering it, it will catch on faster and better.