Mindtree Ltd. has been able to win contracts under the traditional arrangement of dealing with a client's information technology team as well as the digital kind, which requires deeper involvement in various processes of a customer, said the company's Chief Executive Officer and Managing Director Rostov Ravanan.
We are able to hunt in both the grounds now and all of that is giving us good deal wins and good momentum.Rostov Ravanan, CEO and MD, Mindtree Ltd.
The digital segment is boosting Mindtree's business in emerging markets like India, China and Africa, Ravanan told BloomberQuint in an interview.
In terms of pricing, Ravanan said, the traditional run-the-business jobs offer a bigger challenge as customers continue to optimise their costs from their portfolio. It's easier inchange-the-business contracts since one can share cost of services. Here customers are looking for expertise, he said.
Change-The-Business Versus Run-The-Business
Much of the traction that Mindtree is receiving in change-the-business is partly by design and partly by good fortune, said Ravanan. “It is also because Mindtree made the call on digital much earlier as compared to the industry standards and subsequently around 40 percent of our revenue comes from digital.”
The strategy involves interacting with a cross-section of stakeholders, which includes chief marketing officers, brand owners and other heads. “With this, Mindtree aids their customers in understanding their processes and business.”
In the traditional run-the-business build, interaction is limited to only the IT team of the customers, he said.
Finally all of this is leading to a very tangible revenue increase for our customersRostov Ravanan, CEO and MD, Mindtree
The mixture of deals is expected to help Mindtree garner an increase of $100 million in revenue for its customers. Even in the traditional build, Mindtree's customers have been very comfortable in dealing with expert vendors and not just staying with larger traditional companies.
Banking, Financial Services and Insurance Segment
Ravanan said the banking, financial services and insurance (BFSI) segment has taken more time to recover since developed markets have been late adapters to the digital world. In emerging markets like China, India and Africa, digital has become more mainstream, especially in BFSI.
Ravanan cited the example of the U.S. where the BFSI segment is focusing more on fixing regulatory issues. “We are seeing a slower revert of BFSI,” said Ravanan.
Going Forward
Ravanan said that the issues that have affected the company are either from “operation perspective or market perspective”. He said, “At least from this or next quarter, there will be some amount of stability, and I think in a quarter or two from now, we may see a margin upside.”
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