‘Chandni Chowk to China’ in a Korean tale

By : |March 3, 2009 0

Sanjay Gupta It’s a Fortune club company well diversified into energy, utility, telecom and communications and grossed $76 billion in business last year. Quintessentially a Korean company that has delivery centers in China and Korea, it’s now anchoring its roots well in India with a clearly spelled-out strategy. What at the face might look like another captive foray, could very well be the epicenter of the Korean firm’s global spread-out.

Sanjay Gupta, country manager and COO, SK C&C India Pvt Ltd, who is handling the reins of this big and long race from India, talks to Pratima Harigunani of CyberMedia News more about the venture.

Where does India fit in on your global strategy map?

The group belongs to Korea and we have our delivery centers in Korea and China. The target now is to move beyond the oriental territory and reach to global markets. It’s relatively hard for a Korean company based there to seek customers in other geographies. English communication is a point of concern and that’s where India comes in. With a service delivery platform in India we can easily reach out to global customers.

So you are trying a service strategy for going global?

Strictly products don’t sell and we can learn from the IBMs and HPs of the world here. A service-oriented approach works for global expansion. Here it’s about services with our traditional core competencies. One has to demonstrate a service model around a product.

What kind of services would these be and how strong are chances of a pure-play service transition?

Application development, management, RIM 1 and 2 support etc would be the main ones and our initial focus would be on telecom and financial services. We would want to add to our revenues with services but would not have any major shift from our core forte on products.

The idea is simple – if bigger companies are now going for telecom business, then why shouldn’t we, as we already have products to go along with it? We won’t just offer resources, but solutions to add. We know what we are talking. In a pure-play service scenario, however, we stand to face more competition.

Is the timing right?

Bigger problems mean bigger opportunities. Today’s scenario is the most opportune time for a service company and if one sustains the next four to six quarters, when a turnaround is expected, one stands to gain. We would want to start operations now and ride the tide. Some people stand and watch things happening, some wonder what’s happening, and some make things happen. We want to be in the last bracket.

The recent past hasn’t been particularly good for captives in India with scale and sustainability forcing major shut-downs or sell-outs. Does that bother you?

This is an India GDC (Global Delivery Centre) and hence primarily a platform for global delivery. The approach is to build our sales capability through it and it’s a profit centre approach. Captives typically suffer due to cost centre issues. We are clear from the onset that our Indian set-up is to pursue our global business. As to the issues of scale, once we have built critical mass we would keep scaling.

So what is your scale-up plan?

To start with we would hire 200 to 250 resources in 2009 in Bangalore for our GDC and up it to 600 by 2010. The target is to hit over 1200 people by 2011. Some engineers from India are going to Korea for about a year, so that they perfect themselves on the entire technical, product and culture spectrum.

So why not a brown-field operation and instead setting everything from scratch?

Talking of the inorganic route we have two views about it. First, inorganic growth typically takes 12 to 1 months. Plus the kind of opportunities present and investments required are the point of thoughts. We want to initiate our capability building in the next six months while also generating revenues for internal business.

Captives, per se, are cost arbitrage. Instead of waiting for the right candidates why not start building upon the competencies we have. Maybe later on we would be in a position to explore M&A and align and integrate.

How’s the China-Korea-India equation shaping up in these plans?

The perception is that people there have the same language etc, is not actually the case. Koreans don’t understand Chinese and language barriers exist. A delivery centre in China is successful in context of local markets. But for Korea, India makes better sense due to cultural factors. Koreans read a lot and you can find a lot of Post-Graduates there as well as hard-core software programmers. They are good at reading and writing English but vocal skills are missing.

And India would be a captive format?

We will go after other markets and other service elements too and would look beyond SSK Portfolio. I look at captive market as a critical mass to build our capabilities. We would be building enough process and capability maturity along with our core work. We would stack up our competencies as a multiple service provider.

Our approach is to make a COE (Centre of Excellence) for our competencies around telecom and mobile finance. We will put up our entire portfolio around it and take it to our customers.

No Comments so fars

Jump into a conversation

No Comments Yet!

You can be the one to start a conversation.