I am spending the day at the HCL Influencer Day in Boston today. I have long been impressed with HCL’s Product Engineering practice, which still has unlimited runway as it goes after the $ 1.4 trillion annual global R&D spend. I had cataloged the group and their work on the Boeing 787 Dreamliner project in my recent book.
The big news in the last few years is HCL has been making impressive strides in application, infrastructure, BPO and other services markets. My sources in the firm say they are being commercially disciplined (they use metrics like employee EVA to measure performance) even as they chase the “rebid” business (replacing incumbent outsourcing providers) they estimate at $ 190 bn over the next 3 years. Tough to argue with their 7X growth in market cap, even through the deep recession.
I did go into the day fresh from the GE Minds+Machines day where they presented a data/analytics set of services with a relatively low labor component. Splunk presented to the Enterprise Irregulars yesterday their offerings around mining machine data. Over the last few years, I have cataloged on my blogs what Salesforce and Workday have been delivering in massive efficiencies in application management and upgrades, and what Amazon and other cloud infrastructure providers have been doing to redefine the data center.
With that background, it is jarring to see in the morning slides HCL’s rapid labor growth, (impressively outside India in Brazil, Finland, Poland and elsewhere). Vineet Nayyar, the company CEO proudly told Davos earlier this year he would create 10,000 new jobs in the US and Europe. HCL’s philosophy is embodied in its “Employee First” culture.
Someone in the audience asked what HCL is doing for the CMO – all the sentiment analysis and marketing analytics that are exploding. HCL does not appear to have a good answer yet.
High labor, low machine services. Primarily focused on IT and CIO. That to me is the traditional outsourcer. HCL is clearly doing that cheaper, faster and will do well in what it calls the “rebid” business. Nothing wrong with that. I do hope I hear about other sides of HCL beyond just that during the day.