I’m Go­ing to be 5 Mins Away... Not Look­ing For­ward to Leav­ing Any­thing: Chan­dra

The Economic Times - - The N Chandrasekaran Interview -

THE TOUGH GET GO­ING There will al­ways be chal­lenges. You are never go­ing to play on a dead wicket. There will al­ways be a few rough spots and the oc­ca­sional ball... NCHANDRASEKARAN Chair­man-Des­ig­nate, Tata Sons

Tata Sons chair­man-des­ig­nate N Chan­drasekaran and TCS CEO-des­ig­nate Ra­jesh Gopinathan in their last in­ter­view be­fore they move into their new roles, tell Bod­hisatva Gan­guli, TV Ma­halingam and Jochelle Men­donca about the tran­si­tion and the chal­lenges ahead.

Chan­dra, when you took over in 2009, the in­dus­try was go­ing through a tough phase. That’s pretty much the case now when Ra­jesh is tak­ing over. How pre­pared is TCS? N Chan­drasekaran My be­lief is that this in­dus­try has tremen­dous po­ten­tial. The tech­nol­ogy busi­ness is get­ting stronger as it is get­ting em­bed­ded in tech­nol­ogy. There is no ques­tion of lack of op­por­tu­ni­ties. But are there chal­lenges? There will al­ways be chal­lenges. You will have to adapt. Let me give a cricket anal­ogy. You are never go­ing to play on a dead wicket. There will al­ways be a few rough spots and the oc­ca­sional ball will do its thing. So, you can ei­ther say there is tur­moil or you can say that you have to play a par­tic­u­lar ball care­fully. That doesn’t mean you don’t play the other five balls. The best of the in­dus­try, and TCS, is yet to come. Ra­jesh Gopinathan The one thing ev­ery­one is clear about is that they are go­ing to in­vest more in tech­nol­ogy not less. The per­cent­age of in­cre­men­tal spend will be higher to­mor­row than it was yes­ter­day. We are in that sweet spot and this is the only in­dus­try that can claim that.

How is the tran­si­tion go­ing? Chan­dra From the TCS point of view, this is just a for­mal­ity. The en­tire lead­er­ship team, in­clud­ing Ra­jesh, has worked closely with me — some of them for 20 years, some even more. The last one month has been one of in­tro­duc­ing Ra­jesh to key re­la­tion­ships that I en­joyed for a very long time... and more step­ping off, and let­ting him take all de­ci­sions... (with) some ad­vice. But I am not go­ing away. I am very much around. I will con­tinue to be in­volved with strat­egy. I will pro­vide as much sup­port, cover... what­ever you call it. These guys can reach out to me any­time.

Will you have the time to do that? Chan­dra You see, I am not go­ing to be 100% on TCS. My travel will sig­nif­i­cantly come down. I am hop­ing for that. (laughs) In­ter­na­tional travel takes a toll. I have been do­ing that for a long time. I have been on the road for 180-200 days. For weeks, I have done four nights on a plane. Not once but many times. That’s bruis­ing. Ra­jesh, are you look­ing for­ward to that? Chan­dra He is get­ting a taste of it (laughs). Ra­jesh From Jan­uary12 to now — which is about four weeks or so — I have spent two weeks trav­el­ling to Europe, US and went to Sin­ga­pore for a day. Try­ing to get as much time in front of the clients as pos­si­ble. Half of it we did to­gether, or more than half. Some I did with NCS and some with busi­ness unit heads. We are try­ing to reach out to the cus­tomers, es­tab­lish that con­nect. Noth­ing beats that. The bulk of the time has gone in that. We were jok­ing that I used to typ­i­cally go to the US twice a year — he used to go ten times a year. Now we’ll have to flip it.

When did you guys meet for the first time?

pats Gopinathan on the back) You ask him this story.

It was an­other one of those churn pe­ri­ods. In the 1999-2000 time frame, the in­dus­try was go­ing through an­other one of its pe­ri­odic soul search­ings and Chan­dra had de­cided to cre­ate an e-busi­ness unit. Those days e-busi­ness was the top thing — what dig­i­tal is to us. I was in an­other group com­pany called Tata Strate­gic Man­age­ment Group. I worked with Chan­dra in that ini­tial think­ing pe­riod; it looked very in­ter­est­ing and ex­cit­ing. Those days, the gen­eral per­cep­tion was that the in­dus­try would roll over and die. Be­cause the year 2000 would come and then that was it. So here was a guy who had a dif­fer­ent per­spec­tive and it seemed pretty in­ter­est­ing. Through 2000 we worked to­gether and Jan­uary 2001I joined. We have seen this in­dus­try go through its pe­ri­odic cy­cles. Each cy­cle seems very dis­rup­tive, very threat­en­ing, but ac­tu­ally, it is in that change that the op­por­tu­nity lies as long as you po­si­tion your­self well and stay fo­cused on what has to be done. It was an ini­ti­a­tion by fire. At that point TCS was about $600 mil­lion in rev­enue and e-busi­ness was $100 mil­lion. Then we had a pretty good pe­riod of ex­plo­sive growth.

This is also a pe­riod where the in­dus­try is go­ing through sev­eral changes, es­pe­cially with the pro­tec­tion­ist moves around the H-1B visa. How will you deal with that?

The in­dus­try is not an out­come of a visa reg­u­la­tion. I think peo­ple char­ac­terise the in­dus­try as a labour-ar­bi­trage in­dus­try and it’s not. We have gone through a huge revo­lu­tion on the tech­nol­ogy side. The sheer ex­tent of tech­nol­ogy work glob­ally has ex­panded many­fold and In­dia has emerged as a phe­nom­e­nal source of high-qual­ity sup­ply for it. We have rid­den that op­por­tu­nity and we are deeply em­bed­ded into the global sup­ply chain as far as tech­nol­ogy is con­cerned.

have been do­ing this for some time now. For the last 12 months, we’ve had all teams work­ing un­der the con­straint that there will be no H-1B visas. Be­cause I just thought that this was a big topic of dis­cus­sion and we should be pre­pared. In Oc­to­ber 2015, I called the team and said in 2016-2017 we want to op­er­ate with a lot of con­straint on visas. The first re­ac­tion was, ‘How can we do that?’ Then we got the top ten peo­ple and put them in a room for one week and said no­body leaves un­til we de­cide the model. So we de­cided the model and this whole year we have op­er­ated in this en­vi­ron­ment. We made peo­ple won­der, ‘Why is ev­ery­body here? What is hap­pen­ing? Will there be an an­nounce­ment?’ But you have got to do that.

So you as­sumed you would not get any H-1B visas? Chan­dra So we said we will get just a sixth of the H-1B visas we got in the pre­vi­ous year. I wanted zero. But the team came back say­ing we will get 15% of visas. Then we got 15%, be­cause you roughly cal­cu­late how many visas you have to ap­ply for to get 15%. We ap­plied for fewer.

Will you op­er­ate with such a self-im­posed con­straint in FY18? Chan­dra This was one of the ques­tions Ra­jesh asked me dur­ing the tran­si­tion pe­riod. He asked for ad­vice. I have given my thoughts. So he will make up his mind. Ra­jesh, can we ask you that ques­tion? Ra­jesh You can ask af­ter April. Be­cause there is a bit of a com­pet­i­tive dy­namic to it as ev­ery­one is play­ing with their busi­ness models. Chan­dra In gen­eral, I have to be care­ful be­cause I don’t want to speak for any­one in the in­dus­try. Is H-1B a con­cern? Yes it is. Will it have an im­pact? That is likely. What de­gree of im­pact? I don’t know. It de­pends on what the so­lu­tion is. Are we wor­ried about the busi­ness model? We will change the busi­ness model. We have been ex­per­i­ment­ing and we will op­er­ate. And this is a part of do­ing busi­ness. Visa is one com­po­nent of a busi­ness model.

Do you an­tic­i­pate your new job to be tougher than your cur­rent one? Chan­dra I think this is a very unique job. It is a rare dis­tinc­tion, a great priv­i­lege that I would never have imag­ined. The job has a large can­vas, in such a role you will have chal­lenges, you will have op­por­tu­ni­ties. I am look­ing for­ward to it. I hope that I can con­trib­ute and make a dif­fer­ence. Ra­jesh, when you knew that you were tak­ing over this job, what was the one thing that ex­cited you? And what op­por­tu­ni­ties do you see in defin­ing the com­pany? Ra­jesh We are at an in­flec­tion point once again, so what we are see­ing is tech­nol­ogy mov­ing away de­ci­sively from the back of­fice and mov­ing into the front of­fice. It is no longer a cost cen­tre — it is be­com­ing a profit cen­tre in in­dus­try af­ter in­dus­try. The can­vas has com­pletely changed as far as the mar­ket goes. We have to fig­ure out how to po­si­tion our­selves. The ques­tion is, how do we make the most of our op­por­tu­ni­ties? That an­swer is not known yet but the pieces are in place. The good thing is, we fun­da­men­tally be­lieve that de­mand will in­crease. That’s the ex­cite­ment. Many jobs con­strain you. This is prac­ti­cally one job where the whole world is your play­ground. There is no ver­ti­cal in­dus­try or ge­og­ra­phy where we can’t play. So the thing is, how do you make the right choices? And I can’t think of many more in­dus­tries where there is such a wide can­vas. And to in­herit it, with all the strengths built in.

In terms of growth prospects who would you wish to over­take, in terms of size or scale you’d want to reach? Is Ac­cen­ture or IBM your tar­get, since you have al­ready beaten do­mes­tic com­pe­ti­tion? Ra­jesh We re­spect both the com­pa­nies... There are parts of IBM that we ad­mire quite a lot, the sheer scale... we would also like to be a com­pany of that size, and have longevity of that na­ture and to stay rel­e­vant through pass­ing phases. Sim­i­larly, we ad­mire Ac­cen­ture in many ways, but they are rel­a­tively young... So there are el­e­ments we ad­mire, or try to bench­mark. Chan­dra It’s not about who we beat, be­cause we’re a very frag­mented in­dus­try. We have suc­c­ces­fully tran­si­tioned dur­ing the ERP time, Y2K and the In­ter­net time. The point is, run­ning a com­pany is about at­ti­tude of the team. That’s the only thing that counts.

You will have a change of ad­dress, lit­er­ally, and a change of view. Are you go­ing to miss TCS in some ways? Chan­dra I am go­ing to be five min­utes away, lit­er­ally. I still am part of TCS, I am part of the Tata Group. I would like to feel part of every Tata com­pany. I am look­ing for­ward to that. I am not look­ing for­ward to leav­ing any­thing. I am look­ing for­ward to be­ing part of ev­ery­thing. And that’s the fun. So there’s no ques­tion of miss­ing, no ques­tion of be­long­ing more.

Ra­jesh Gopinathan (left) and N Chan­drasekaran

PHOTO: NISHIKANT GAMRE Chan­dra ( Ra­jesh Ra­jesh Chan­dra We

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