TCS COO, NG Subramaniam sees healthy demand in a tough FY18
BENGALURU: Tata Consultancy Services has not yet seen a customer talk about cutting its IT budget for the next financial year, the company's chief operating officer told ET, showing a positive signal for demand in what is widely expected to be a tough year for the sector.
NG Subramaniam took over as COO in February, a role that hasn't existed in the company since 2009. TCS has in the past used the role of COO as a stepping stone to the top job.
“We have been meeting customers over the last two-three months, and no one has said they will be cutting their budgets.That is the best thing I can say about the demand environment.But now we need to see if all the spending comes through and when it comes through,“ Subramaniam told ET in his first interview since taking over as COO.
Subramaniam said that the planning horizon for its customers had come to one quarter, requiring the IT company to be more agile in its own execution.
“Immediately after Lehman, nobody was making plans more than 24 hours ahead. Then it started increasing to a week, a month. Currently, it is a quarter.So we have adjusted our ways of working as well,“ Subramaniam said. One of the adjustments has been the company's hiring practices. “Earlier, we'd have a hiring target and then it didn't really matter when the people came on board. But now we break the hiring up by quarters, so we can calibrate the people we take on board with the demand scenario at the time,“ Subramaniam said.
Increasingly, Indian IT firms have had to change how they operate in response to the more uncertain environment. Mindtree's CEO Rostow Ravanan had told ET that the uncertainty was unprecedented in this history of Indian IT and that the company was moving towards a rolling quarterly plan for FY18 instead of a fixed yearly plan.
In February, the National Association of Software and Services Companies (Nasscom) delayed issuing its growth target for FY18 citing uncertainty. The IT sector has been hit by Britain's vote to exit the European Union and the growing tide of protection in its major market, the US.
Subramaniam said TCS understood that there would be constraints going forward and would adapt to the changes. “It is part of business that there will be constraints in every market. The idea is to work around them. We have to anticipate a constrained environment. We have been hiring in the US and we are one of the largest job creators in the US in the technology industry.“
In FY17, TCS operated under a self-imposed visa constraint and applied for just 15% of the visas for which it normally applies.
In his new role, Subramaniam expects to spend about 80% of his time meeting customers and the rest handling the operations part of the business. “After the announcement was made, I told everybody that they should keep doing what they are doing. But I said that they could send me any problems they didn't want to handle themselves.“
NG Subramaniam took over as COO in February, a role that hasn't existed in the company since 2009. TCS has in the past used the role of COO as a stepping stone to the top job.
“We have been meeting customers over the last two-three months, and no one has said they will be cutting their budgets.That is the best thing I can say about the demand environment.But now we need to see if all the spending comes through and when it comes through,“ Subramaniam told ET in his first interview since taking over as COO. Subramaniam said that the planning horizon for its customers had come to one quarter, requiring the IT company to be more agile in its own execution.
“Immediately after Lehman, nobody was making plans more than 24 hours ahead. Then it started increasing to a week, a month. Currently, it is a quarter.So we have adjusted our ways of working as well,“ Subramaniam said. One of the adjustments has been the company's hiring practices. “Earlier, we'd have a hiring target and then it didn't really matter when the people came on board. But now we break the hiring up by quarters, so we can calibrate the people we take on board with the demand scenario at the time,“ Subramaniam said.
Increasingly, Indian IT firms have had to change how they operate in response to the more uncertain environment. Mindtree's CEO Rostow Ravanan had told ET that the uncertainty was unprecedented in this history of Indian IT and that the company was moving towards a rolling quarterly plan for FY18 instead of a fixed yearly plan.
In February, the National Association of Software and Services Companies (Nasscom) delayed issuing its growth target for FY18 citing uncertainty. The IT sector has been hit by Britain's vote to exit the European Union and the growing tide of protection in its major market, the US.
Subramaniam said TCS understood that there would be constraints going forward and would adapt to the changes. “It is part of business that there will be constraints in every market. The idea is to work around them. We have to anticipate a constrained environment. We have been hiring in the US and we are one of the largest job creators in the US in the technology industry.“
In FY17, TCS operated under a self-imposed visa constraint and applied for just 15% of the visas for which it normally applies.
In his new role, Subramaniam expects to spend about 80% of his time meeting customers and the rest handling the operations part of the business. “After the announcement was made, I told everybody that they should keep doing what they are doing. But I said that they could send me any problems they didn't want to handle themselves.“
