The Hindu Business Line : An eye for change

IT takes a chameleonic skill to change with the times. And to change quickly within a matter of three or four years takes a good feel for where the industry is heading.

Vardhman Jain, Chief Executive Officer of Vision Healthsource, along with brother Anurag Jain (who built up Brigade Solutions to a level where VCs were glad to pump in money, before quitting Brigade), is making changes that he needs to, to survive and thrive in business process outsourcing in the area of healthcare.

Vision Healthsource started off with its first client coming in in 1998, as a 60-people, medical transcription company and soon (within six months of commencing operations), hearing the death knell of the business, switched to claims processing for the healthcare industry. Today, it has 325 employees and 17 clients.

You might recall eWorld's chat with Anurag Jain, then with Brigade Solutions, ("March to a different beat" in eWorld dated February 20, 2002) who refused to adopt the capacity building model. According to him, if you built capacity and waited for orders in India, you would be forced to undercut heavily and hence be in danger of going under. Instead, he acquired the assets of existing BPO operations in the US and then slowly had the work transferred to the India base, while finding more work for the US operations.

The thinking, starkly different from industry norms, is influencing Vardhman's Vision Healthsource. The company recently acquired stake in a start-up. Why would a young company such as Vision buy stake in another company, when the funds could be used for its own operations? It gets interesting here, so listen to this: Vision has just broken even and is comfortably placed vis-à-vis monthly operational requirements. The American company, in which Vision has invested, has a founder who has a wealth of experience behind him. Vision would also get to be the exclusive outsourcing partner for that company, which means more business for Vision in the area of financial and accounting back office processing, to which Vision till now had no exposure.

One way to look at this kind of an arrangement is to cite maximising the value of an investment. If the new baby clicks, then Vision would have created an entity with enhanced market capitalisation, thus giving Vision high returns on investment, Vision would have got benefit out of the outsourcing arrangement and would still keep these two businesses separate so that the good or ill fortunes of one need not necessarily affect the other. Having the cake and eating it too? So be it.

On the other hand, if the arrangement doesn't rake in revenues, then so be it; it's as good has having hired the experienced gentleman for a costly salary. On the investment front, Vardhman is unwilling to divulge too many details except that "We own between 20 and 30 per cent in this US company."

Vision, meanwhile, based on the current monthly run-rate, has an annual turnover of $3.6 million and hopes to touch $10 million by December 2003. It is also looking at the adjudicating business in healthcare insurance. Currently, it provides solutions to the hospital side of the work. There are emerging opportunities for projects in insurance companies, to which hospital claims go. To avoid conflict of interests in processing both sides of a claim, Vision plans a separate unit for the adjudicating business.

Plans for the future

For the long term, Vision is planning its next centre at Visakhapatnam,"hopefully this fiscal but certainly by end of calendar 2003."

Its large clients are demanding that Vision put up alternative centres to counter war threats in the Indian geography.

According to Vardhman, "We have taken up some space in Canada and have skeletal staff there. But there are visa problems. Now we are looking at a centre in Mauritius or in the Philippines."

But within India, why not continue in Chennai with the second centre?

Says Vardhman, "In Chennai, infrastructure is a challenge. We have two centres linked with the aid of the local telephone company. Every time the link goes down, which is more often than we want it to be, we have to run behind those folks. Power is another problem for us. The awareness in Chennai of how ITES folks work is also exasperating. We work 24 hours. As CEO, I might be required at the dead of night. On the way to the office at unearthly hours, the police stop me and question me as to why I am out. The concept of 24/7 seems strange to them."

bharatk@thehindu.co.in

Send this article to Friends by E-Mail
Comment on this article to BLFeedback@thehindu.co.in

Stories in this Section
Is your back-up plan crack-proof?

This call's for the kisan

Emerging from the shell

Setting off a chain reaction

Outlook Express hitch

Print trouble

File transfer from one PC to another

Coughing up more than cash

Big window to the small guy

An eye for change

IT counter's closed, buddy

Quiz

Cartoon

Quick on the uptake

Something to fit the pocket and wallet