Meeting the challenge of scalability

ONE KEY issue is that of scalability.

An issue to be dealt with being how to scale up this business. How do you maintain the company growth? There are a number of aspects to scalability, the first is good planning.

Planning, the first key: We have a planning process through our marketing strategy and action plan, and through our planning process, we take a hard look at the future, future projections and also at the business by different growth areas. We then use that entire process to plan backwards and understand the kind of capacity we need, the kind of people and training we need, the kind of technology we need to invest in, the learning we need to do and so forth.

One aspect of scalability is very detailed long-term planning. If the company is planning to hire people for July or September next year, it must have a sense of what kind and what numbers of people it will need at that point, but those decisions must be made today, in order to make the right number of offers. This demonstrates the importance of planning.

There has to be forward planning, and a long view of the business, with detailed planning, which in turn, translates into the necessary investments in people, technology, physical infrastructure and so on.

Speed of execution: The second aspect of scalability is the speed of execution. For example, today, from concept to occupation, the facilities are delivered in nine months. Those people who were here a few months ago, will notice that there has been a substantial change in this campus. This again, is a reflection of the speed at which the company is able to deliver the infrastructure -- nine months from concept to occupation.

Handling volumes: Another aspect of scalability is the ability to handle the volume. In the last four months, the company has processed about 100,000 applications -- again an example of scalability on the recruitment side. One aspect of this issue is to be able to build and produce facilities, technologies and the infrastructure for scale.

Software of scalability: How does one make sure the people added are absorbed and trained, that these people understand the company's values, that they are oriented towards the culture, that they understand emerging technology, business requirements and so forth?

Here, we have a whole set of initiatives from the training group, there is the Six Sigma initiative which is trying to improve the quality processes, and the CMM Level 5 initiative, which enables the company to ensure that every project is executed at the same high level of quality. There is also the Baldridge initiative, through which it is trying to spot gaps in the model that has to be addressed through different means.

Knowledge management: There is also a whole host of knowledge management initiatives which make sure that knowledge gained in one part of the company is put into public domain internally, so that the rest of the company can use that knowledge.

Therefore, scalability requires a whole set of things, some of which are in the physical world, in terms of facilities infrastructure, technology infrastructure, people recruitment and so forth. Then there is another set of things required on the software side in terms of training, leadership programmes, orientation programmes, value system building, quality improvement and knowledge management.

The bench strength: Another aspect of scalability is what is the level of bench one must carry. Obviously, the model requires that capacity utilisation be a very important part of the business. Infosys's capacity as a company is characterised by the calibre of the people working for it.

It is the management's duty to make sure that the capacity is utilised as effectively and fully as possible, and on the right kind of projects, for the right kind of customers, with the right kind of prices. At the same time, it must ensure that it does not run capacity to an extent where it is unable to respond to new market needs.

It is important to respond to new market needs. If one gets a brand new opportunity, in a new market, in a whole new technology space and in a whole new virtual domain, the company must be able to quickly wrap up, execute and deliver to the customer, the kind of results expected.

Again, this is a balance between full utilisation and keeping strategic bench, which can be used to ensure that customers can be satisfied.

Managing multiple locations: Yet another aspect is managing scale when there are multiple locations. Four-to-five years ago, Infosys was a single location company. Its operations were only in Bangalore. Today, there are 18 Development Centres in eight cities. The operations have expanded to Chennai, Pune, Bhubaneswar, Mangalore, Mysore, Hyderabad, and Mohali. The challenge therefore is this.

How does one ensure that the same value, the same process efficiency and execution scale, which is there in the company is quickly replicated in each of the other locations? The same principles are disseminated through a whole set of cultural, quality and leadership programmes, to make sure that at every Infosys location, there is the same calibre of manpower, execution and motivation to take the company forward.

The challenge of scalability now, is to make sure that as the company truly globalises operations, the same kind of attention to detail, quality, customer satisfaction, culture and values are maintained. A large part of the focus at Infosys is to ensure that it is able to scale on all fronts -- the physical front, the global front as well as on the soft issues front.

All this, while it is still able to retain in a large company, the quality, brand and effectiveness it had, as a small company. It also means the company has to invest in the future. Investing in future is not only about investing in core areas.

Infosys has also been investing in domain knowledge, building technology infrastructure and building frameworks for the future. All of these are investments it is making in the future, with the belief they are required to meet the challenges of management, scalability, and going up the value chain.

(This is the second and concluding part of the edited extracts from the theme address, `Leading to the future' delivered by Mr. Nandan. M. Nilekani, Managing Director and Chief Operating Officer of Infosys Technologies. The first part was published last Sunday.)