We will manage the transition with dignity: Cognizant CEO

BENGALURU: In an interaction with TOI shortly after the company's September quarter results, Competent CEO Brian Humphries said he is returning to the basics: collapse the layers of the company and focus on growth. The company is carrying out one of the biggest layoffs in recent times, and Humphries, who took office in April, said he feels great compassion for the people affected in the cost reduction program, and the company will manage the transition and people with dignity. Excerpts

Why did you want to exit the content moderation business?

At the beginning of this year, we carried out a review of our strategy and through that review we decided our strategic intention in the future and our strategy has two parts. First, protect and optimize our core portfolio, which includes tools and efficiency automation, delivery optimization, renewal protection, strengthening our industry alignment and expanding our international presence. And second, win in four key digital battlefields: data, digital engineering, cloud and IoT. It is a review that we made during the last seven months upon my arrival as a new CEO and we decided that certain elements of content moderation are not in line with our strategic vision for the company, so we intend to abandon them.

What is the impact on revenue by reducing the content moderation portfolio?

The impact is in the range of $ 240- $ 270 million on an annualized basis. The transition will take place in the next year or so. We have some contractual obligations that remain and it depends on how quickly the business closes.

In addition to liquidating the content moderation business, it plans to eliminate another 10,000-12,000 roles. What is driving that?

Of the 10,000-12,000 jobs that are being eliminated at the medium to higher level, we plan to fill in approximately 5,000 in terms of new skills needed to fulfill our digital growth operations. Then there will be a net impact of approximately 5,000-7,000 employees. The impact of the workforce is both at sea and on land. In the broader scheme of things, we are 3 lakh people, and in no way I want to belittle job losses because we take it very seriously, but I do want to contextualize that this represents 1.5% to 2% of our staff . As CEO, I had a lot of deliberation and thought about this. We also have the responsibility of the 3 remaining people.

How do you identify these roles? Do they focus on certain businesses?

It is not aligned with a business or vertical unit, it is broad based. What we are trying to do is look at the pyramid, and there has been a growth in the director plus the population in Competent in recent years and there has been a growth in non-billable resources in recent years. What I am trying to do is adjust the size of the pyramid so that we eliminate some middle managers and managers without affecting customer commitment or satisfaction or customer centrality.

You said earlier that your ability to accelerate the growth of the company's top line depends on revitalizing its performance in North America. The challenges in US health care. UU. And BFSI add to the growing pains?

Healthcare and BFSI represent two thirds of our business. In recent years, we have not been participating as much as I would like in those markets and we have not been growing. In the last quarter, both businesses showed accelerated growth compared to the second quarter growth rate. We know we have more work to do. We changed the leaders of both companies in the last six months and now there is a lot of energy in those units with strong leaders and a strong centralization in the client, proactive comments from C-suite of the main clients who talk about the new team of leadership. From the team's point of view, I feel much better with North America, providing more energy than I had 4 or 5 months ago.

There’s pressure from clients for rate reductions and volume discounts. How is that playing out for Competent ?

There’s pricing pressure on renewals at a steady state. Companies like Competent have to be quite efficient in automation, AI, optimise our pyramids, location and strategy so that we remain competitive in our renewals. Our strategic focus is winning in the four digital battlegrounds. In the digital arena, IT spends is viewed as a business enabler and a critical success factor of businesses and there I see more of a supply constraint rather than a demand constraint in the industry.