Wipro Laces its Wingtips

CM: You have been at Wipro for almost four years. Since you arrived, the company has doubled in size. How have things changed for you since you started? Matlack: You know, I feel sometimes like I've spent my entire life explaining to my mother what I do and who I work for, and there's always a new wrinkle that she doesn't fully understand. But even she gets it now. Things were different when I started here. For the most part, the Indian companies didn't have much visibility among people in this business as potential employers, and only in certain cases did they have visibility as competition. And I think that in the last four years, as these firms have continued to grow — and, frankly, as some of the Western-based firms have continued to struggle — there's a greater awareness that the business model from which the India-based companies have been evolving is a very powerful one, and it's here to stay. This is not just a flash in the pan. These are serious companies, and I think that it helped a lot that TCS did a flotation, so you now have sort of three top companies. They all have worked very hard at becoming good employers of non-Indians as well as Indians. These are very serious, determined organizations, and it's changing the image of Indian companies. You know, I was interviewing someone yesterday who works for one of the large Western-based companies, and he said, "I'm just tired of the fact that no one seems to be willing to be disciplined and follow through on what ought to be obvious, and on things that, frankly, I see the Indian companies doing a lot better." That degree of awareness wasn't out there four years ago.

 
CM: So, what is it that Indian companies have right?

Matlack: Well, one of the reasons that these companies have been successful is because of the commitment they all made to embedding quality processes in the company and running as very, very, centrally disciplined organizations. And I think that they did it both for cultural reasons and for defensive reasons. The defensive reasons were because there had been a perception in the West of "you couldn't necessarily trust those Indians." And it's sort of like what Japanese companies had to go through when I was growing up in the U.S., where if it was made in Japan, it meant it was usually cheap and made out of plastic. In order to dispel those images, the better companies invested very heavily in quality methodologies. They ensured a lot of centralization of business planning and business controls. And they imposed a certain amount of discipline and rigor, which today, I think, makes them very strong. In many cases, it contrasts with the more decentralized kinds of historically partner-based firms where, unfortunately, in the worst examples it was pretty much whatever the particular local partner wanted to do that got done. I can recall coming out of business school in the mid-'70s. Then, even firms like McKinsey, which in general are among the best-run consulting firms in the world, would tell my friends who were interviewing, "Well, you know, LA is this style of operation. It's a bunch of ex-military guys, and they run it in their own little fiefdoms. And then there's Chicago, which operates this way. And then nobody goes to Germany who's a woman, because the Germans don't like women." Firms just were that way. And that's a legacy that still kind of lurks in the background, which is not the case with Indian firms.

CM: As Wipro builds up its global consulting practice, what limitation does its historic identity of being an IT service provider present? Matlack: One of the limitations is that if you want open-ended, creative problem-solving around business issues where it's not clear how you're going to go, you didn't historically call an Indian company. And yet, increasingly, these are the kinds of areas that our customers want assistance in and are prepared to have India-based companies work on if they demonstrate that they have skills and the kind of creativity to provide good solutions in that area. And in a sense, this is the origin of most of these firms deciding we've got to get in the business, because we have opportunities to start working on answering and solving the questions and the problems from which the solutions get developed, and not just waiting for somebody else to do it, and then coming and saying, "We can implement the solutions better."

CM: What has Wipro done to marry the IT service line with the consulting line of business? Matlack: Our goal in our consulting practice is to augment and complement the services that are delivered by other parts of the firm. There you've got a lot of choices in terms of how separate you want to make the consulting business. And I felt that while you could argue that in starting it you could be successful by saying, "We're not like Wipro. We're really different and establishing a lot of space," that over the long haul, this was not a good strategy, because we needed to be linked well with the business. Our customers would expect us to be linked into the business. And in my experience in watching other systems integration companies start to move into consulting, the vast majority of them, I felt, had not done a very effective job of figuring out how to leverage and support consultants, and many times had gone out and bought other firms or brought in hired guns and wasted a lot of money and nothing ever came of it. You have to worry about a lot of different things. And one is integration with your internal teams, your sales force, your other service lines, so that they're not feeling like you're going around them, but you work up integrated value propositions, ways that leverage the whole firm, but where consulting helps. And then the second is from the perspective of the customer. I think that the customer expects to have as few transaction costs as possible when dealing with a large firm, and one of the ways in which you do that is that you say that the account management team that you work with is your account management team, and we will work through the account management team to give you more services, but we aren't going to try to compete with creating a separate channel — that, you know, "we only talk to God" kind of thing. I was just with the CIO of a very, very serious company last week and meeting him for the first time, and he said, "Now, let me get things straight." He said, "Am I going to have to talk to multiple guys to use you guys?" And I said, "No." And he said, "Good. Because I've had these guys from other firms in here, and they said, 'Oh, well, we're a different channel, and it's really important.'" So those are the subtle ways in which, at least, we've tried to make it work for Wipro.

CM: How do you leverage your big offshore team in your consulting practice? Matlack: We have a Center of Excellence in India. It's a group of professionals who support us who do work in India to support our business development efforts. They support the development of different consulting solutions. They get engaged, sometimes on specific projects where there are tasks that can be efficiently performed offshore. And they will come and deploy for short periods onsite to augment the permanently based consultants in the U.S. Certain types of consulting projects lend themselves more to kinds of leveraging offshore folks than others. But one of the things that we're trying to do is get creative in the way we develop our consulting solutions so that we can make greater and greater use of our very good offshore talent. Certainly, our customers don't mind it when it translates into value pricing, shall we say . . .

CM: How do you see Wipro in relation to its Indian competitors — namely, Infosys and TCS? Matlack: It's easier for me to compare with Infosys, because they've, as they frequently do, spent more time trying to make a name for themselves. I know TCS more through the fact that a couple of my buddies were hired there, and I know what they're like. So in many respects I think we probably have a little more in common at Wipro with TCS and a little less in common with Infosys. Infosys has taken a very high-profile approach to its consulting. I think that they have focused largely on business process improvement areas and left most of the IT consulting to the rest of the organization. They've set themselves up as a very different and distinct part of the business, with separate Web sites. Steve Pratt gets a lot of personal press, and they have got a very visible commitment from the corporate leadership of Infosys to a multiyear investment where it didn't matter whether they were making money — what mattered was that they were helping to achieve a set of broader goals. Certainly, the Wipro consulting team has not attempted to create as much of a different profile from the rest of Wipro. While we've done our best and will continue to make sure that our customers are aware of the new and different services they can now get from Wipro Consulting, we also make it clear that we are an extension of it. And as I said, I think that we've found that our customers like the fact that it is still one-stop shopping. I think we feel, for the Wipro culture, that this is a better way for us to go in terms of internal acceptance by the other very good people who are part of the Wipro family, and that this ability to leverage the whole company is something that is an asset for us. The other thing is that we have felt from the beginning that we not only had to start offering new services, but at the same time had to make sure of what we were offering, and within the firm were continuing to be a profitable enterprise. And so we have to follow the same financial discipline, pretty much, as any other part of Wipro. It may have meant that we couldn't invest in hiring quite as many people ahead of revenues, but it also, I think, means that we have established our bona fides inside the company. And frankly, I can't run a business any other way, because in a sense there's a point at which you're no longer a consulting business, and you're simply a bunch of giveaways. And that's a perfectly fine corporate strategy, but you ought to have the strategy to do that and not just sort of back into it. We did that in part by making sure that we were offering services that our customers were comfortable buying right up front. So we have been evolving from a technology base towards increasingly a business process base, and we continue to offer services that are around technology consulting. In some respect, things that are grounded in technology issues are still the largest component of our business, because it is just lying there. We might as well sell it. But the second thing is that it provides a base of revenues and services in which we then can invest and use to grow the additional services that we're going to offer over time. Just like real companies do. You leverage your base, you add new products, you make them profitable, and you expand it, and then you start looking for the next thing.