BENGALURU: Cognizant’s ambition is to regain its growth bellwether status and knock a few rivals off their perch, said CEO Brian Humphries, as he restructures the IT services provider to grow quickly going forward.
The Teaneck, New Jersey-headquartered company was a leader in growth terms, as it typically used to settle for lower margins than Indian software services rivals. However, about three years ago, Cognizant changed its strategy to increase margins after activist investor Elliott Management got on board, in the process slowing the topline.
Earlier this year, Cognizant slashed growth guidance to 5.1% at best, the lowest in its 25-year history. “Cognizant has been a bellwether of the industry for many many years, and in more recent years, we have not. And, our collective ambition is to understand how to make that happen again,” Humphries told ET in an interview. The company will now make strategic bets in sectors such as Cloud, digital engineering, data and the internet of things. It will also expand footprint in international markets where it already is present, such as the UK, the Nordics, the Benelux region and others.
Humphries is betting that growth on track will solve the other issues it faced over the past three years. “I want to be bigger everywhere. I have a lot of ambition and competitive instincts, and some of our competitors, I would like to knock them off their perch a little bit. Jokes aside, we have growth ambitions and that will be the story of Cognizant in the years ahead,” he said.
Under Humphries, the company has rejigged operations to include how it manages talent and pays the sales team. Humphries has gunned for more variable pay for sales staff to ensure those who outperform would get paid more, creating a performance culture. The investment in sales is to get more clients on board and help avoid surprises. Four of Cognizant’s biggest health care clients merged and cut spending, forcing the company to cut growth guidance.
“The single biggest thing I can do is decide whom to promote, to hire, or whom to demote. And that goes back to the core of some of my leadership beliefs, which are clarity of communication, clarity of role, who is responsible for what,” Humphries said. “It also enables a performance culture, because if I know the role clarity is there, then Iknow who is responsible for what. So, I know who took over a business and turned it around and I know who took over a healthy business and damaged it.”
Since Humphries took over, Cognizant has seen a slew of senior-level exits, including the heads of its banking and healthcare businesses, which had lagged in growth terms. The company has also created a retention program that will cost as much as $48 million, and is targeted at director-level employees and above. Humphries wants to ensure that the restructuring at Cognizant gets over quickly and does not drag on, he has said previously. Employees have faced the prospect of job cuts for three years now, ET has reported.
“There is noise in the system that is an unnecessary distraction. As I stand in front of clients every day and our associates, I say the single biggest thing we can do to help ourselves is get back to growth,” Humphries said, when asked about employee woes. He has also not heard concerns being expressed about its restructuring from customers, Humphries added.
The Teaneck, New Jersey-headquartered company was a leader in growth terms, as it typically used to settle for lower margins than Indian software services rivals. However, about three years ago, Cognizant changed its strategy to increase margins after activist investor Elliott Management got on board, in the process slowing the topline.
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Humphries is betting that growth on track will solve the other issues it faced over the past three years. “I want to be bigger everywhere. I have a lot of ambition and competitive instincts, and some of our competitors, I would like to knock them off their perch a little bit. Jokes aside, we have growth ambitions and that will be the story of Cognizant in the years ahead,” he said.
Under Humphries, the company has rejigged operations to include how it manages talent and pays the sales team. Humphries has gunned for more variable pay for sales staff to ensure those who outperform would get paid more, creating a performance culture. The investment in sales is to get more clients on board and help avoid surprises. Four of Cognizant’s biggest health care clients merged and cut spending, forcing the company to cut growth guidance.
“The single biggest thing I can do is decide whom to promote, to hire, or whom to demote. And that goes back to the core of some of my leadership beliefs, which are clarity of communication, clarity of role, who is responsible for what,” Humphries said. “It also enables a performance culture, because if I know the role clarity is there, then Iknow who is responsible for what. So, I know who took over a business and turned it around and I know who took over a healthy business and damaged it.”
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Since Humphries took over, Cognizant has seen a slew of senior-level exits, including the heads of its banking and healthcare businesses, which had lagged in growth terms. The company has also created a retention program that will cost as much as $48 million, and is targeted at director-level employees and above. Humphries wants to ensure that the restructuring at Cognizant gets over quickly and does not drag on, he has said previously. Employees have faced the prospect of job cuts for three years now, ET has reported.
“There is noise in the system that is an unnecessary distraction. As I stand in front of clients every day and our associates, I say the single biggest thing we can do to help ourselves is get back to growth,” Humphries said, when asked about employee woes. He has also not heard concerns being expressed about its restructuring from customers, Humphries added.
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