SPI: Specifically focused Date:   Wednesday , July 02, 2008 The customs officials in Mysore were at their wits’ end and so were officials in Software Paradigms India (SPI). “What is it that you’re exporting?” the customs department would ask, demanding that the product being exported be shown to them. “We had a tough time explaining, since we couldn’t possibly show the IT services that we were exporting,” recalls Sid Mookerji. Mookerji is the CEO of SPI, which has come a long way since its humble beginnings in 1997 as Mysore’s first IT Services 100 percent Export Oriented Unit. Today, it is the largest Mysore-based IT services company with domain expertise spanning healthcare, financial services and retail. Vertical focus The IT landscape currently is fragmented, with the largest player, IBM Global Services, accounting for less than 7 percent of the market. Statistics say that among companies with 500 or more employees, only 11 percent are outsourcing today. Further, work worth only $50 billion is done in India today as against a potential $3 trillion. There lies an immense scope for IT services companies to make a mark, since more and more firms are expected to outsource their IT services in the near future. It is here that SPI, a mid-tier IT services company, fits in. SPI, with a headcount of over 1000 employees cannot compete with Tier 1 competitors like Infosys and Wipro on the basis of scale. It is for this reason that a deep knowledge of specific verticals is essential to its being. “For us, focus on verticals is not an option, it’s a necessity,” says Mookerji. In fact, he lists deep focus in healthcare, financial services and retail as one of the key differentiators for SPI. Over the last decade or so, the company has acquired a rich body of experience and knowledge base in these verticals. It showcases this experience to prospective customers through demonstrating product experience. Also, the fact that the SPI team is packed with domain experts helps customers make up their mind when it comes to competition against companies with a broad domain. The other differentiator for SPI is the use of tools. “It is a part of our organization’s DNA,” says Mookerji. From beginning to end of the product lifecycle, SPI has tools to make processes more effective. One that Mookerji mentions most enthusiastically is spiProject®. The tool is used for giving complete visibility to the way a project proceeds to the customer. Each customer of SPI is provided with unique login credentials which he or she can use to sign in and see what specific task the engineers assigned to the project worked on during the previous night and how the tasks are being executed according to priority. “Instead of sending them all this information over e-mail, which is generally deleted after a certain point in time, we make vital project related data available to the client through spiProject®,” notes Mookerji. Over time, this helps build a knowledge base for clients. When SPI approaches prospective customers, it leverages the industry insight gleaned from this knowledge base built over a period of time to win tough deals. Outsourcing Suitability Matrix (OSM) is another among the unique tools used by SPI. It helps decide, on behalf of clients, which projects are best suited for outsourcing. The matrix helps gauge which business areas of the client company have greater maturity in management and interfacing, hence making them more suitable for outsourcing. This brings a certain maturity in the relationship with the client and their technology and helps take the conversion rate higher. On the surface, it seems that tools such as spiProject and OSM would help mid-tier companies make crucial decisions. But SPI’s experience tells that mid-tier companies are used to individual brilliance and are generally disinterested in tools. “The larger guys understand the value of processes and tools along with the associated benefits of better documentation and greater maintainability,” quips Mookerji. High Barriers to Exit Since domain expertise is one of the key differentiators for SPI, care is taken to project the same in front of clients as well. There is always an onsite PMI certified Project Manager available at the customers’ site. This is crucial since clients often encounter a feeling of ‘lack of control’ over the projects and areas they have chosen to outsource. The onsite manager helps maintain a level of comfort and counsels the customer on various issues. Also, SPI has forged partnerships with companies in the U.S. having exclusive insight on retail. This helps the company advise its clients at a strategic level. These constitute what Mookerji calls ‘barriers to exit’ for the customer. “Customer acquisition is a difficult task, and once we have them in our fold, we need to ensure in every way that the customer stays with us,” says Mookerji. His team makes it a point to share productivity improvements with customers, thereby demonstrating how difficult and expensive it would be for someone else to produce the same results. As customers repose their faith in SPI, it results in innovations. For example, in retail, visibility in all stages of the supply chain, in terms of tracking an order from beginning to end, was something that its customers were looking for. That each customer had separate merchandising systems made things difficult. In response, SPI developed a Glass Pipeline solution that integrate data systems and allows the customer find out where a consignment is at a given point of time, when it is expected to land, reach the store et al. Early Mover Beginning operations in 1997, SPI was one of the early movers in the IT services arena in Mysore. It was a lack of customized products and cost optimization as well as the need for a work culture sans hierarchy that prompted Mookerji to start SPI. Interestingly, he chose Mysore over the more preferred Bangalore as the base. At one level, it was his desire to give back something to the community he grew up in that prompted the decision. Also, he gathered that there were many good educational institutes in Mysore and people wouldn’t necessarily have to move out in order to work in SPI. It was a question of availability of talent, and stands true till today. Says Mookerji, “Today, when bigger players have set up shop here, we hardly lose people to other companies in Mysore.” It helps that SPI is mentioned in the same breath as Wipro and Infosys, since not many companies are based in Mysore. It gives a fillip to the brand name and helps attract talent. Also, Mookerji, who is based in the U.S. visits the centre every three months and spends time with key people on a one-on-one as well in group settings. Care is taken to disallow hierarchical tendencies to creep into the system. Among the 1000 odd employees of SPI, 900 are based in Mysore, with the rest in the U.S. Over 30 percent of its workforce constitutes PMI certified personnel. Last year, SPI acquired a BPO firm. Going ahead, Mookerji states that more acquisitions are on the anvil. Also, other development centers in India and in the U.S. are also on the anvil. Growth like that would make it a remarkable journey since the humble beginnings of SPI over a decade ago.