Business First! How HCL Tech beat the street

While its new-found mantra of ‘employees first, customers second,’ which it announced sometimes back, might have baffled many on the Dalal Street and also to those on the main street, but it seems to be now paying off. 

Look no further than the firm’s latest results for the second quarter of the financial year 2010-11 in which the Shiv Nadar-controlled technology giant has delivered an eye-popping growth of over 34% in its consolidated profit after tax (PAT) on a year-on-year basis to Rs. 400 crore; the company’s PAT grew by 20.7% sequentially or an a Q-o-Q basis. In contrast, a Reuters poll of market analysts had forecast the company’s net profit to grow 24 per cent y-o-y to Rs 368 crore.

HCL Technologies is India’s fourth largest software services exporter after TCS, Infosys, and Wipro. The company also posted an impressive rise of 28% in its revenues to Rs. 3,888 crore on a y-o-y basis (4.9% q-o-q basis).

The management attributed the better-than-expected performance to the ‘Volume-led robust growth across all Geographies, Verticals and Service Offerings.’ The New Delhi-headquartered technology firm also added 46 new customers in the calendar year 2010.

Employee First Policy, turning conventional management wisdom upside down

HCL Technologies, one of India’s fastest growing IT services companies, has embraced a new strategy – Employees First Customers Second – that places the needs of employees before the needs of customers. This seemingly counterintuitive strategy has provoked a sea-change at the company, and, believe it or not, greater customer loyalty, better engagements and higher revenues. Given the pace of industry growth and its dependency on headcount, attracting, retaining and motivating talent is the top challenge for the industry. The traditional approach viewed employees as commodities and placed emphasis deploying entry-level talent and a factory-like approach for project execution. There were no unique engagement strategies centered on the employee. While the industry growth rate is impressive, and most analysts do not project a down-turn, the question of whether this demand will sustain and business will continue as usual is beginning to become a concern. New automation-based technologies have emerged to challenge the need for mass labor and, as the outsourcing market has matured, both suppliers and customers are seeking ways to achieve innovative and transformational value that goes beyond simple cost savings. In many cases, outsourcing customers no longer view IT service providers as mere vendors, but as business partners whose work is intimately tied to the customer’s success. That shift in working relationship requires a new kind of IT service organization – one focused on value and innovation, not just warm bodies to fill seats. So, how does a company attract the talent necessary to meet that challenge? At HCL, the company embraced a program designed to turn the traditional “customer above all else” model on its head. Called Employee First, the strategy encompasses a variety of elements with the objective of providing a truly unique environment to employees. By treating employees as partners and participants in the company’s success, every individual within the company becomes responsible for transforming, thinking and providing value to customers. To make the Employee First concept work, HCL launched a variety of internal initiatives designed to both give employees more personally responsibility for the company’s service offerings and a voice with upper management. HCL’s enlightened approach to employee development focus on giving people whatever they need to succeed: be it a virtual assistant or talent transformation sabbaticals; expert guidance or fast track growth; inner peace or democratic empowerment. At HCL, what we have is Five Fold Path to Individual Enlightenment. This ensures they are given Support, Knowledge, Recognition, Empowerment, and Transformation. It’s about creating a new kind of corporation. It’s about empowering extra-ordinary individuals. It’s about you.

Source: HCL Technologies

Scroll down to read further….

Fresh Views- HCL Business First - Q2 2011 Analysis

About HCL Technologies

HCL Technologies is a leading global IT services company, working with clients in the areas that impact and redefine the core of their businesses. Since its inception into the global landscape after its IPO in 1999, HCL focuses on 'transformational outsourcing', underlined by innovation and value creation, and offers integrated portfolio of services including software-led IT solutions, remote infrastructure management, engineering and R&D services and BPO. HCL leverages its extensive global offshore infrastructure and network of offices in 29 countries to provide holistic, multi-service delivery in key industry verticals including Financial Services, Manufacturing, Consumer Services, Public Services and Healthcare. HCL takes pride in its philosophy of 'Employee First' which empowers our 72,267 transformers to create a real value for the customers. HCL Technologies, along with its subsidiaries, had consolidated revenues of US$ 3.1 billion (Rs. 14,101 crore), as on 31st December 2010 (on LTM basis).

About HCL Enterprise

HCL is a $5.5 billion leading global technology and IT enterprise comprising two companies listed in India - HCL Technologies and HCL Infosystems. Founded in 1976, HCL is one of India's original IT garage start-ups. A pioneer of modern computing, HCL is a global transformational enterprise today. Its range of offerings includes product engineering, custom & package applications, BPO, IT infrastructure services, IT hardware, systems integration, and distribution of information and communications technology (ICT) products across a wide range of focused industry verticals. The HCL team consists of over 77,000 professionals of diverse nationalities, who operate from 29 countries including over 500 points of presence in India. HCL has partnerships with several leading Global 1000 firms, including leading IT and technology firms. For more information, please visit www.hcl.com.