NDTV: Cognizant’s President Says Traditional Companies Need to Reinvent and Focus on Innovation and Digital Technologies Now in Order to Differentiate for the Future

In an exclusive interview to NDTV at this year’s World Economic Forum in Davos, Gordon Coburn says traditional companies need to re-invent now to survive and expects automation to transform the face of all industries in the next five years. Excerpts:

“If you think about the IT industry, we are thrilled by what we are hearing here at Davos. The whole position here this year is the fourth industrial revolution, which is about how you apply technology and become digital, and how that is changing everything we do in business.

Today, across industries, we are seeing our clients have a dual mandate, which is having to do two things at once. In becoming more efficient and more effective, they have to reduce the costs of running their businesses day to day. But more importantly, and increasingly so in the last 12 months, clients are focusing on how to innovate, run differently, apply technology and digital not just to operate the existing processes, but to fundamentally change the supply chain.

You can only cut your costs so far. In the end, you have to start to grow your top line. You have disruptive technologies coming into play, whether it is Airbnb, Uber or Amazon. Traditional companies are looking at this and saying, if they don’t innovate and change, they could become irrelevant. So, they are really looking at efforts in digital technologies and asking how do they make sure they are competitive, how do they make sure they differentiate for the next decade?

We look at automation, artificial intelligence and robotics as a key activity over the coming years. We are already a leader in how we apply these technologies, particularly in business process services, infrastructure services, and areas of IT such as testing. I don’t think it is going to change the industry overnight, but over the coming five years, it will materially break the linearity between revenue and headcount in certain areas. Not only that, it will also improve service levels and efficiency.

What we are seeing is a continuing, significant shift in where clients are spending their money. Clients want to invest heavily in digital transformation, not just of their technologies, but also of their processes and of how they run their businesses.

We are investing heavily in these areas and starting to see the benefits. For instance, we now have more and more of our own platforms. That is becoming very important because clients are increasingly saying that because they want to be agile and reduce capital investments, and don’t want to have the burden of regulatory compliance, they want to use Cognizant’s platforms, people and IT and want Cognizant to deliver the outcomes to them. Healthcare is the best example, where we have clients who want to pay us per member, per month to provide administrative services.

We think this is a trend that is going to continue and is going to be an important part of our business going forward.”