Perot Systems to expand India operations

Wei Gu

PLANO, Texas: Perot Systems, the largest U.S. provider of outsourcing services for hospitals, plans to expand its operations in India to reduce costs and drive growth in an increasingly competitive environment, its chief executive said on Thursday.

Perot Systems, which currently has a quarter of its staff based in India, plans to increase the headcount there by 2,500, to 7,000 by the end of the year.

Turnover in its India outsourcing operations is about 24 percent, much lower than the industry average of 52 percent, the company said, despite two recent high-profile departures.

"People who work for us there are not back-office people," CEO Peter Altabef said in an interview. "They get out to meet clients and they are actively working as part of our delivery and management team."

Plano, Texas-based Perot, founded by former U.S. presidential candidate Ross Perot, started investing in India as early as 1996.

The company originally planned to build a profitable operation and sell it, but encouraged by its success, Perot purchased the other half of its Indian joint venture.

There have been some kinks in the process. Two top leaders for Perot in India left within the past six months, but the company recently hired Padma Ravichander, an executive who used to lead Oracle Corp.'s and Hewlett-Packard Co.'s India outsourcing businesses to be head of India and Asia-Pacific operations.

Perot said its staff in India has helped keep costs low. The company grew its revenue by 22 percent last year, but as a mid-sized firm, it is sandwiched between large vendors such as International Business Machines Corp. and smaller Indian ones.

Altabef said the company's acquisition strategy was focused on improving technology.

"We do not acquire just to be larger," Altabef said. "We have a rigorous acquisition program and it's a disciplined one."

The company believes stock buyback is one of the best ways to use cash. It has $262 million in cash and recently authorized a $75 million share repurchase program.

Perot, which is still 30 percent owned by the Perot family, also said it is not interested in putting itself up for sale.