NDTV Profit: Cognizant’s President Sees a Shift in Spending Toward Driving Top-Line Growth and Innovation

“We saw strong growth across the board—geographies, industries, and service lines,” says Gordon Coburn. “The Financial Services sector grew in line with the company overall by about 6.5%. Given its size, that’s tremendous growth. It was broad-based across large banks and mid-sized banks. Europe grew 11% sequentially that included an acquisition we did in Germany. The payer side of Healthcare did well. Retail did very well. We continue to see healthy growth in what we refer to as our Horizon 2 businesses: consulting, BPO and infrastructure management services. So when we look at all operational statistics, we’re very pleased. We are very pleased with the core operations also. Our strategy is to keep our operating margins a bit lower than competition and invest that in the front end. That should result in stronger revenue growth.”

He says, “Good delivery is table stakes. Looking at the deals that we’re winning, when I ask clients why you selected us, they say, “What’s unique about you is you understood our business, you understood our business challenges, and you proactively come to us with ideas on how we could do to both run better and run different. That’s the key thing. What we’ve seen particularly in this quarter is a shift in spending, where clients are not trying to just save money but trying to grow top line, trying to innovate, and we refer to this as ‘run different’. To help a client run different, you have to really understand the industry well and you have to have your own ideas about how you can improve the clients’ businesses. We’re well situated for that.”

Coburn adds, “Europe has good prospects and we are going to continue to invest heavily there. We have also significantly increased our investment in the rest of the world, particularly India, the Middle East, Singapore, Australia, Hong Kong and Japan.”