Capgemini to leverage India talent base to develop assets, says COO

Thierry Delaporte says that the move is to leverage the strength of its India unit to the maximum and take the same strategy to other markets

French IT services and consulting major Capgemini, which recently announced a new set of leaders for its India unit, including the appointment of a new chief executive officer (CEO), is betting big on the country as an innovation and talent hub. The company’s Group Chief Operating Officer THIERRY DELAPORTE tells Debasis Mohapatra that the move is to leverage the strength of its India unit to the maximum and take the same strategy to other markets. Edited excerpts: 

How is the demand environment for Capgemini amidst increasing protectionism from the US and Brexit fears?

The market is good for us. This a changing world, and in places like the US, the UK or in France, Germany, China or Russia, the need for technology remains vital. In most of the sectors, digital transformation is affecting every company of the world. We are at the forefront of helping the companies in preparing for their future in a disruptive market.

Capgemini has announced Ashwin Yardi its CEO for India in a top management reshuffle. What is the rationale behind this move? 

Over the past years, we have developed our business tremendously in India. We reached the 100,000-employee mark (in India) last year with more than 50 per cent of our employee base located in the country, and we continue to grow. Also, the impact of Capgemini India within the group has evolved over the years. So we have reached a point (in India) where we felt we need to reinforce our governance. In the context of preparing for the next chapter of life of Capgemini, we reinforced our governance so that we can maximise the impact of Capgemini India in the overall organisation. We have now one chairman, one CEO and two COOs in India.

By appointing two COOs for India, are you trying to replicate your global model?

The fact is that we have two COOs in India is not the way we organise at the group level. Coincidentally, we (Capgemini India and Capgemini Group) have some similarities. That doesn’t mean that we are replicating this set up everywhere in the world. When you are managing a large business in India, we felt that we need more than one COO. As India becomes increasingly a centre of technology and innovation with development of solution and assets, we want to leverage the talent base to develop assets that can be used elsewhere in the world.

Does it indicate the change in Capgemini’s go-to-market strategy with more importance being given to geographies and services than verticals?

No. What is clear is that we have organised our business around clients. Inside the geography, we are organised by sectors. So, the sector dimension is important. Earlier, every service lines, be it outsourcing, consulting or business process or infrastructure, used to have its own go-to-market. So, they used to go to the same clients, selling their own services. But we have now aligned all our services to serve the same clients but through the same channel. However, our attention to sectors is higher than ever. Rather, we have shifted our priorities.

As far as operating margin is concerned, Capgemini seems to have a long way to go to catch up with peers. What’s the plan?

If you see, the (client) accounts that have come to us with IGATE, we have grown them all. For example, the McDonald’s account came to us through acquisition of IGATE, and now it’s a multi-million dollar account. So, we have tremendously leveraged the acquisition of IGATE and it helped us to improve our margin. We have systematically improved our margins over the past 10 years. Now, we have given a mid-term guidance of 12.5 to 13 per cent and are sticking to it. There will be a point of time when we will revisit it, but for the time being, we continue to track towards this target.