30 NOV,
2012, 10.38AM IST, ET BUREAU
Strategies adopted by Zensar Technologies to become a billion dollar
enterprise in four years?
Priyanka Sangani
A few months ago, Zensar TechnologiesBSE 3.89 %won the Porter Prize for the best strategy process in the IT & Communications sector — the first time the prize, named after strategy uber-guru Michael Porterwas held outside Japan in India.
For the RPG Group firm, it was just further validation of its efforts to ensure that it was indeed relevant in a crowded sector.The Porter prize was awarded to the company for 'creating a competitive advantage by aligning its strategy to customer centricity and continuous innovation' and vice chairman & CEO Ganesh Natrajan says that the company's focus has been on innovation since inception."When we started in 2001, we were a brand new software company with no reason to exist. We had to have a different point of view if we were to be taken seriously and do something different from our more established peers. We wanted to be a company clients would come to if they wanted to challenge the way they did software development," he says. The focus seems to be paying off.
A few months ago, Zensar TechnologiesBSE 3.89 %won the Porter Prize for the best strategy process in the IT & Communications sector — the first time the prize, named after strategy uber-guru Michael Porterwas held outside Japan in India.
For the RPG Group firm, it was just further validation of its efforts to ensure that it was indeed relevant in a crowded sector.The Porter prize was awarded to the company for 'creating a competitive advantage by aligning its strategy to customer centricity and continuous innovation' and vice chairman & CEO Ganesh Natrajan says that the company's focus has been on innovation since inception."When we started in 2001, we were a brand new software company with no reason to exist. We had to have a different point of view if we were to be taken seriously and do something different from our more established peers. We wanted to be a company clients would come to if they wanted to challenge the way they did software development," he says. The focus seems to be paying off.
ZensarBSE 3.89 % closed last year with revenues of $372
million and has been growing at a steady pace despite a not too conducive
business environment. Now it has set its sights higher, on that magical billion
dollar mark. "We have the potential to continue to grow at 20% over the
next few years, but we still need that additional capability to grow 10% and
make those large deals happen," says Natarajan.
While bigticket acquisitions may or may not happen, Zensar has been working at fine tuning its internal processes over the last few years to try and hit $1billion in revenue by 2016-17. "Our existing team will continue to grow at about 20%, but this will bring in that incremental push. About another $100 million will be through acquisitions, but the rest will be organic growth with people exceeding their own capabilities," he says.
In the last six months alone, the company has sealed three deals of over $5 million and is planning to set up a separate team to focus on deals of this size. In 2010, Zensar acquired the US-headquartered Akibia which gave it a solid presence in the rapidly growing infrastructure management segment.
This is an important area for the company as the practice has been growing at about 60% and contributes about a third of the company's revenues. This will be an important part of its quest to hit the billion dollar figure, along with manufacturing and retail which currently comprise 50% of revenues.
One thing that works to its advantage is that the contribution of the financial sector is relatively lower. Healthcare is also fast emerging as an important segment. Dipen Shah, Sr-VP, private client group research,Kotak Securities says, "Their strategy is pretty well laid out.The company has indicated the areas in which it plans to grow. This is a strategy that can definitely take them much higher provided it is executed properly." The biggest change has been in organisation structure, moving from being services led to a vertical led one. http://economictimes.indiatimes.com/features/corporate-dossier/strategies-adopted-by-zensar-technologies-to-become-a-billion-dollar-enterprise-in-four-years/articleshow/17415783.cms
While bigticket acquisitions may or may not happen, Zensar has been working at fine tuning its internal processes over the last few years to try and hit $1billion in revenue by 2016-17. "Our existing team will continue to grow at about 20%, but this will bring in that incremental push. About another $100 million will be through acquisitions, but the rest will be organic growth with people exceeding their own capabilities," he says.
In the last six months alone, the company has sealed three deals of over $5 million and is planning to set up a separate team to focus on deals of this size. In 2010, Zensar acquired the US-headquartered Akibia which gave it a solid presence in the rapidly growing infrastructure management segment.
This is an important area for the company as the practice has been growing at about 60% and contributes about a third of the company's revenues. This will be an important part of its quest to hit the billion dollar figure, along with manufacturing and retail which currently comprise 50% of revenues.
One thing that works to its advantage is that the contribution of the financial sector is relatively lower. Healthcare is also fast emerging as an important segment. Dipen Shah, Sr-VP, private client group research,Kotak Securities says, "Their strategy is pretty well laid out.The company has indicated the areas in which it plans to grow. This is a strategy that can definitely take them much higher provided it is executed properly." The biggest change has been in organisation structure, moving from being services led to a vertical led one. http://economictimes.indiatimes.com/features/corporate-dossier/strategies-adopted-by-zensar-technologies-to-become-a-billion-dollar-enterprise-in-four-years/articleshow/17415783.cms
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