An interview with. R Chandrasekaran, president and managing director, Cognizant
At a time when its rivals like Infosys and Wipro have said that their earnings will continue to decline in the immediate future, Cognizant is confident of achieving 'at least' 10% growth for FY10. R Chandrasekaran, president and managing director, Cognizant speaks on how it plans to achieve the feat. Excerpts from the interview:
Is IT spending by your clients looking up or is the worry continuing?
The majority of our client budgets have been finalised. This process has taken longer than it has in earlier years and many budgets are flat or down. However, spending has not altogether disappeared. While our clients are continuing to spend on offshore services, given the environment, they are doing so more carefully. We believe that there are opportunities for us and we are investing and adapting to ensure that we can seize these opportunities.
What has been the demand of price reduction by clients?
On a sequential basis, in Q1, pricing was down slightly, in low single digits. This came in right in line with what we were expecting. Pricing was down for three reasons: shift to application maintenance services (as opposed to complex application development and systems integration services) where the skill sets required are different, weakness in the European currency and the currency translation impact, and deal sizes getting bigger because of which scale efficiencies kick in.
Source: DNA
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