Collabera, a privately held $500 million IT firm, is one of the largest IT staffing firms in the US. The company has started to focus on IT services business and has hired Raj Mamodia from Cognizant Technologies as its CEO. Mamodia talks to Anand J about his plans on how the company will take on the big players and the transformation happening in US IT staffing space. Excerpts:

Since you became the CEO, the company has decided to focus more on IT services business? How is it turning out?

The company has its roots in IT staffing services and for about a decade we are focusing on the IT services business. The company has made three acquisitions to deepen its capability in IT service. Both are very healthy businesses and we think of them as distinct but fast growing businesses for us.

Over last several years, they have been trying to integrate both of them so we can become a billion dollar IT services firm. But since I have come on board, we have put together a strategy that actually attempts to do something opposite of that. I believe that from an economic value perspective, it makes more sense to run these two businesses in a more disconnected way.

We believe that given the tremendous amount of technological change that is taking place, the impact on the source of competitiveness that technology has and the state of IT services industry opens opportunities for firms to take a different position now, instead of continuing to build on that input-based model we believe that we can create an entire different kind of niche for ourselves. We are investing heavily in IT services and we are looking at some

acquisitions as well.

What are your growth plans for the IT services and how are you doing it differently?

Actually, it?s easier now than ever before. The technology shift in social, mobility, cloud, analytics is a real one. Big data has tremendous amount of businesses, and these technologies are growing at unprecedented pace; big data is growing at 32% CAGR, almost 7 times faster than IT services. As you look at these growth rates, there is a demand-supply gap.

Gartner says by 2018 around half of the total requirement actually will be unfulfilled; about 150,000 people is what they will need more in the US, in the area of big data. The big services companies have legacy that they can?t undo, they also have a business model that keeps the bread and butter coming, and I think that to me is an opportunity for a firm like us in terms of how responsive, flexible and innovative we can be.

We are hiring in areas that is a interface between the technology and the business. We are trying to be closer to the consumer.

But will it not be costly for you?

What happens is that there?s an incubation phase, and then there is an ongoing operational phase. Once the technology is on the high curve, kind of being incubated, I don?t believe that you can drive the right amount of innovation with the customer by taking it away and putting in more operational model. We will do the onsite-offshore model at a later stage

because we already have that capability.

Being a company registered in US, do you derive some mileage like preferential treatment especially from government side contracts?

We are not focused on government at all. We are focused on industries that are highly regulated. Do we get benefit because we are a US corporation? I think to some degree, because it drives certain level of comfort, but beyond a level to me what matters most is the capability and your ability to serve the customers. The highly consumer-oriented and services-oriented industries. We are largely focused in the US.

How do you see the larger IT growth this year? Will the shutdown have any impact on the IT business?

We see tremendous growth this year, except for the telecom sector. Somewhere it is more regulatory focused, at another place it is a transformation process, but there has been a pent up demand and is driving the growth. Is it going to stay? Given that what is going on in the US, there is a certain amount of uncertainty. Overall, the industries particularly where we are focused on, there is tremendous amount of transformation going on.

What is the kind of transformation happening in the IT staffing space?

IT staffing is a $25 billion market in the US, and on that front we are leaders. Multiple things are happening there. One is that in some of these industries, the demand for contingent staff has been on the rise for last few years and the IT budgets have also been increasing.

Collabera?s focus has been on the large enterprise, Fortune 500 type of firms. The company has an extremely good and efficient operating model and it can be deployed to leverage growth outside our target segment today. But then when you also look at what is going on in the technology that we talked about on the solutions front, it has an impact on IT staffing as well.