How software services firm, Coforge– went from laggard to industry-beating growth?
Read this fascinating piece by Shelley Singh in today’s Mint
Amidst all the hype around startups, d2Cbrands, valuations, etc- it was refreshing to read this story of a business transformation in true sense 😀
Here are the highlights from the article 👇
The company which started as the software services division of NIIT (an early mover in the computer learning space) later rebranded as Coforge has seen a phenomenal growth under Sudhir Singh, who joined the company as CEO in 2017.
In the four years before Singh took over, the company grew at a compound annual growth rate (CAGR) of 3.1%; since he began helming it, Coforge has grown at a CAGR of 16%, with a market cap now around $6 billion compared to $370 million six years 🔥
The stock price has zoomed around 400% in the last five years 🚀
How did that happen? According to Singh, it was due to a series of “contrarian bets” that paid off.
The 4 big bets that paid off as per the article:
1. Onboard leaders who have played in the big league
In 2017, when Sudhir Singh joined the company, the first thing he did as CEO was to change the entire top leadership— replacing all his 14 direct reports.
Interestingly none of the new leaders were hired from other midcaps. Talent generally rotates from one small firm to another but the new team was roped in from Infosys, TCS, Accenture and the like. These were leaders who had seen big deals and growth with their previous employers.
2. Stay closer to your clients
The second contrarian bet Coforge took was to change the centre of gravity of the leadership. Earlier, 11 out of the 14 were based in India; Singh moved the top tier closer to client markets. He himself is based in New Jersey, with the US accounting for half of the company’s business.
3. Find your niche and specialise in it
The third thing that Coforge focused on was not following the herd. All technology services providers end up offering similar services as the top tier and then struggle for growth as they can’t build the capability of larger companies. The company identified sub-segments within banking and insurance and focused on building capabilities in those.
4. Generously reward the performers 😄
The company also changed its rewards and recognition system. Singh quadrupled sales incentives, realizing that pushing people is not enough. So, the commission on bagging new deals went up 4x, motivating employees to do more.
All these turned the also-ran into a player to be reckoned with 💪
On current form, Coforge is on track to close this fiscal year at around $1.4 billion or ₹11,000 crore. The company is eyeing $2 billion in revenue by FY27
Now that’s what you call a real transformation 📈
