Birlasoft, a CK Birla group software company, has witnessed many transitions since inception in 1992. The company was originally named Birla Information Technologies and rechristened Birla Horizon after joining hands with US-based Computer Horizon in 1995. The marriage ended in mid-1998 resulting in its new identity, Birlasoft Inc. The company is based in the US and has its subsidiaries in India and UK. The company has recently entered into a partnership with GE and has been appointed implementation partner by US-based iPlanet for its e-commerce solutions. Mr Sumit Ganguli, who is executive vice-president of Birlasoft Limited and heads US operations, talked to Ashu Kumar about future strategies and plans of Birlasoft. Excerpts:What is the nature of the relationship Birlasoft has with GE?GE is a strategic and equity partner in the company. GE currently holds 20 per cent equity in Birlasoft. We are setting up a Global Software Development Centre with GE in Noida in a 20,000 square feet area. The centre, which will be operational by February next year, will have a maximum capacity of 400 seats. Besides, the company is also executing software projects in the US with GE.
You have recently tied up with Sun-Netscape venture, iPlanet, for the implementation of e-commerce solutions. However, iPlanet is also appointing other big consultants like PriceWaterhouse and Arthur Anderson as implementation partners.
How do you plan to survive against big and established consultants in the global market?
Our strength is in product knowledge. We were associated with iPlanet even before the products are launched and were actively involved in acquiring knowledge during the development process. We have developed the implementation process manual for iPlanet. This knowledge and experience will give us a lead compared to the others in the market. Moreover, our focus will be more on product implementation and customization and iPlanet will help us by referring the projects to us.
What will be the revenue targets and growth plans of the company in the coming years?
We plan to achieve a revenue target of $200 million by the end of the financial year 2003-4. Out of which, around 30 per cent revenue would be from software projects alone. The company expects net profit to touch at least 20 per cent of its revenue by then.
The company is expected to touch around $70 million revenue this year ending March 2001 and expects around 50 per cent growth next year. Currently, about 90 per cent of the revenue comes from US operations, out of which 85 per cent is contributed by professional services and 15 per cent from projects.
How do you plan to achieve these targets? What business strategies will be followed by Birlasoft to meet the projected growth?
We have decided to focus on building two business blocks. The first will be in line with what we are doing with GE in developing Global Development Centers. We plan to explore similar opportunities in association with banking and telecommunication sector companies. These are the two sectors where a lot of growth opportunities are there and good budgets are available with companies.
It will be very easy for us to replicate our experience in setting up development centers with other companies. Moreover, it is a predictable and sustainable business model and provides stability to the organization.The second area would be exploring opportunities in new segments like we did by getting into iPlanet implementation business. However, the challenge ahead of us is to make inroads despite being a small company. We will have to change the ground rules of the game.
Copyright © 2000 Indian Express Newspapers (Bombay) Ltd.
