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CIO Priorities: MindTree

Posted on Saturday, Nov 7th 2009

By Guest Author Narayanan Raman

In my two previous articles, I spoke with executives at two leading tech-consulting houses, Accenture and Deloitte Consulting. In this article, I speak with Sudhir Kumar Reddy, CIO of MindTree Consulting, a global IT solutions company headquartered in India, specializing in IT services, product engineering, infrastructure management and technical support (IMTS), and independent testing and knowledge services. The recession, which has hit the United States particularly hard, had huge ramifications on the IT services industry in India because about 60% of the industry’s revenues still come from the United States.

For Sudhir, at the top of the priority list are reducing costs and improving operational efficiency, with an eye toward staying lean and in shape to be able to compete effectively. While deciding on projects, the payback period is a major factor – Sudhir says that “ROIs of 3 and 4 years is a thing of the past. If we can see ROI in about a year’s time, it’s probably something that will get approved in a year like this. If we are able to find such projects, we are accelerating [their] implementation . . .”

IT as a whole can be broadly categorized into IT infrastructure, IT applications, and IT strategy and management. Sudhir has specific priorities for each layer.

In the infrastructure space, Sudhir emphasizes collaboration as the biggest thrust area, with an objective to enable richer, more effective collaboration among dispersed project teams, without having to travel as much. Collaboration solutions being considered range from Live Meeting and WebEx on the lower end of the spectrum to richer tools such as Telepresence on the higher end. For example, MindTree recently conducted its annual plan meeting in a “zero travel” mode completely on Live Meeting. The meeting ran for six days, eight hours a day with 140 participants from 14 countries. The meeting was one of the company’s most productive ever, and by using Live Meeting, MindTree saved $190,000. Unified communication and virtualization are other areas in infrastructure that Sudhir is focusing on.

In the applications space, Sudhir says that the primary focus is going to be business intelligence – on the ability to deliver insightful information to business unit heads through intelligent reports run over the data generated on the company’s ERP platform. Asset and license management is another important area on Sudhir’s application space agenda.

In terms of IT Strategy, Sudhir made two salient points. First, everything that is utilitarian is being outsourced. This is interesting, as MindTree, which is an outsourcing vendor itself, still outsources the part of its work that it considers “utilitarian” (e.g. Level 1 Support) to players who are adept at managing those activities. Second, most project requests from business do not have a shelf life, that is, they need immediate attention, and tangible solutions need to be delivered as soon as possible.  Hence, Sudhir says that in his team, every project is viewed in terms of a “three-month cycle”; larger projects (longer than three months) are also broken down to fit into corresponding “three month cycles.”

Being the CIO of a leading IT services company, Sudhir is a great source of information on the sentiments of his clients, and by extension that of the overall industry. When asked about client sentiment, Sudhir says that although most clients’ businesses are no longer shrinking, they are not really growing, either; there are blips of growth and sentiment is positive, although not exuberant.

I finished by asking Sudhir about the role of cloud computing and how if affects outsourcing providers, especially those in India. Sudhir views cloud computing as a “leveler,” providing smaller players a level playing field by equipping them with basic setup (infrastructure, office productivity/CRM/ERP/content management software) to start and run businesses at a much lower cost. Given that, cloud computing initially is likely to be adopted primarily by mid-size companies, or by very time-dependent applications of large organizations with specific needs for a set period. Sudhir also says that since SaaS-cloud setups typically run in a multitenant environment, only limited customization is possible; companies would therefore need outsourcing providers to help them differentiate their IT processes. This phenomenon, among others, will force outsourcers to reinvent themselves, move up the value chain, provide specialized business domain solutions, and think beyond mere cost arbitrage, which will start to disappear.

The conversation with Sudhir shed light on specific priorities that typically run through each of the three broad layers of IT. Sudhir’s take on cloud computing and SaaS was particularly interesting. A common theme across all the organizations (see CIO Priorities: Accenture, and CIO Priorities: Deloitte Consulting) is the focus on collaborative technologies, both on the efficiency frontier, that is through cost reduction, and on the effectiveness frontier, by bringing dispersed teams and diverse talent pools closer.

This segment is a part in the series : CIO Priorities

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