Mahindra Satyam is on a three-year transformation journey, and its CEO CP Gurnani is betting on the challenges falling by the way side over the next two quarters. In an interaction with FE?s BV Mahalakshmi, Gurnani said he will now approach old customers.
How do you view the transformation process? Are you heading for better quarters now?
The recovery is stable, but in terms of profitability, there is a lot to be desired. We have gained some new projects. In the last two quarters, we have added nine new accounts, though not large ones. But still there is a definite affirmation of faiths. With the new found synergy with the parent company, we are able to offer solution-based selling and the going now has become much more easier.
Which are the segments that are seeing the most traction?
Since the company has become current now, we are seeing huge traction in the manufacturing segment and there are new clients in the financial and government space as well. As you are aware we have even won a deal with Irda. We would now aggressively go back to old customers.
Can you explain some of the challenges which continue to plague the company?
Some of the new accounts start slowly and grow gradually. In absolute terms, the growth may not be rapid as there are class action suits besides fresh competition. Since the stigma will take some more time to go away, there will not be a miracle overnight. The key word is patience. The next thing is the attrition rate which is about 25% as against the industry average of 13%. In order to retain talent, we pushed for a 15% pay hike. However, the utilisation rate is only 71% and we hope to improve it.
What are the new pillars of growth?
The five pillars include customers, technology and innovation, people, growth and profitability. The 28,000-odd people are committed to the last two pillars. We will try to improve the Ebitda margins from the present 5.2%. In terms of geographies, the US still contributes 60%, 25% revenue come from the Europe, 16% from RoW. The APAC market is growing steadily and same is the case with West Asia and Africa.