Mahindra Satyam scaling up in Malaysia

• Mahindra Satyam confident of hitting 1,100 staff in two years from current headcount of 500
• Growth in its Global Solution Center led by both its Asean and Malaysia business

“MALAYSIA is looking very good for us,” said Ram Ramachandran (pic), vice president and head of Sales (Asean) for Mahindra Satyam during a recent interview with Digital News Asia (DNA).
 
Mahindra Satyam is a part of the US$15.4-billion Mahindra Group, a global industrial federation of companies and one of the top 10 business houses based in India. With revenue of around US$2.4 billion and operations in 54 countries, Mahindra Satyam -- along with its parent company Tech Mahindra -- is one India’s largest IT outsourcing companies.
 
Readers may recall that Satyam Computers was rocked by a major scandal four years ago when founder (and former chairman B. Ramalinga Raju) confessed to widespread fraud regarding the company's financials. The Mahindra Group came into the picture in 2009 by acquiring a controlling stake and set about integrating its IT arm Tech Mahindra with Satyam, hence the new name Mahindra Satyam.
 
Its Malaysian operations have the capacity to seat 1,100 people, which Ram expects to hit in two years’ time from the current 500. Local business has grown by two and a half times over the last two years, outpacing Asean region growth, which doubled over the same period, he claims. Utilization rate of the staff stands at a very healthy 98% which means only 2% of staff are not doing work that can be billed to customers.
 
Does such a high utilization rate mean that they cannot take on any new business opportunities? The global outsourcing industry does not work that way with clients working in advance with outsourced providers to prepare for when they will outsource the work.
 
This then allows for the service providers such as Mahindra Satyam to prepare their resources for the work they are expected to deliver to clients which typically range from five- to 10-year contracts.
 
Ram stressed that planning was very important to get the balance right and the kind of work they want to bring to Malaysia was also pretty well laid out. “We also need to balance the market requirements with what our goals are and where we want to be.”
 
The major verticals that it wants to establish global leadership in include banking and financials, manufacturing, telecommunications, retail and healthcare with defense and aerospace being among the company’s minor verticals.
 
The verticals it has built expertise in within Malaysia are banking and financial, manufacturing and travel, transportation and logistics, with the latter services offered mostly to local customers.
 
With Malaysia being a Global Solution Center, the team here services both regional and global customers. Ram makes note of the fact that almost 85% of the team are Malaysians and says this is both a differentiator and fulfillment of a promise made.
 
A 400-seat training facility is a recent addition to the Malaysian set-up with all fresh graduates undergoing a six-month training stint to bring them up to global delivery standards and get them exposed to the verticals they will be working in.
 
“This gives them both a domain centric view and prepares them for real life scenarios and this training is standard across the world for us,” said Ram.
 
Up Next: Creating a Silicon Valley culture and the rationale behind carving out 50 ‘mini-CEOs’