Interview with BVR Mohan Reddy, Cyient
The name Bodanapu Venkat Rama Mohan Reddy may not ring a bell immediately but say BVR Mohan Reddy and you immediately associate him being the founder and Executive Chairman of Cyient Limited.
A visionary leader, entrepreneur, innovator and a person with an impeccable public record, Mohan Reddy is a recognized thought leader and founding father of the IT Enabled Engineering Services industry globally (ITES) having given over more than four decades of his life to the field. With achievements galore, he also served as Chairman, NASSCOM (The National Association of Software and Services Companies) during 2015-16 and has been engaged into various industry and government initiatives including Make in India, Digital India and Swatch Bharat to name a few. His organization, Cyient, ranks among the top 15 Indian IT services companies [Source: NASSCOM 2013-14] with revenues of around INR 3,500+ crores (close to US$550 million). Cyient has generated cumulative export revenue of US$2 billion and employs nearly 14,000 people across 38 locations globally. Little wonder then he has been deservedly awarded India’s fourth highest civilian honour the Padma Shri Award in 2017. For someone who strongly believes in creating a positive impact to the society through use of technology, Mohan has set up 54 CDCs (computer center, digital library, and NDLM centers) across Serilingampally Mandal, Telangana. These CDCs are the digital gateway for more than 20,000 underprivileged children and will foster IT literacy in over 50,000 members of local BPL community. He tells us more about his numerous initiatives and his life story to date in this exclusive conversation.
Tell us something about your early days, was being in the engineering services always something you wanted to do?
I still vividly recall my childhood days that I was very fascinated with steam driven “Road Rollers” which were used for laying tar roads. I was so intrigued with that monstrous equipment that I used to tell my friends “someday I will become a driver and drive that huge machine”. As I grew older I started realizing the role of technology in making just steam drive a 10 Tonne machine to compact and lay a tar road. It was then that my love and interest for engineering and technology started developing. All through my formative years, I had a special passion for engineering, it was always close to my heart and I always wanted to do something in Engineering. My first major break came in 1982 when I became the CEO of a computer aided design / computer aided engineering (CAD/CAM) systems company. It was a great opportunity for me to learn more about Engineering in different areas and more importantly suggest solutions to customers on how computers could solve their design and engineering problems. When I started Cyient (then known as Infotech Enterprises), the core idea was to build a company which could provide engineering as a service to global markets. In those years most of the Indian companies were operating in the broader and generic area of IT services outsourcing, there was no company which had looked into a niche offering of engineering design services as the global companies were not ready to outsource engineering then. But the path to success for the company was not an easy one, while I wished to establish a company that was unique, the opportunities in engineering where my interests lay; hardly existed. We had to remain flexible and it took us almost 10 years before customers started recognizing our engineering DNA. Fast forward to today when we are amongst the top 10 engineering services companies in the world, it was a fulfilling journey.
How were the initial days of your career and how did you get into engineering services?
As much as engineering was close to my heart, entrepreneurship was always a dream for me. I always had a passion for building a creative business that would sustain itself forever. While most people in those days would settle in the US after having studied there, I wanted to come back to explore opportunities in India, start something that could generate employment for people back home. I belong to a generation where to be a first generation entrepreneur (as opposed to family run businesses), experience was very critical. The first ten years of my career were therefore, spent in gaining solid experience in all facets of business – Operations, Management Information Systems and Sales and Marketing. This hands on experience in the early years of my career gave me required grounding to be a successful entrepreneur. My next stint helped me implement everything that I learnt, into practice where I ran the first CAD/CAM system integration company in India. My passion for engineering and my drive to become an entrepreneur lead me to always scout for opportunities which could fulfil both my aspirations and hone my skills. Though it was slightly late in my life that I started my own venture – Infotech Enterprises, when I look back, I feel satisfied that I took the road less travelled and succeeded in creating a global organization.
Tell us about how and why you started Cyient and what does the word Cyient means/signify?
In 1991, I saw that the Indian economy was opening up and it would mean tremendous opportunities for Indian companies. I saw an opportunity in providing engineering as a service for it was not done at scale by anyone in the past. I established Infotech Enterprises (known earlier) with 4 engineers at 40 with my own and borrowed capital of Rs 25 lakhs. The original name of current company, Cyient was Infotech Enterprises and I was one of those people who always said ‘what is in a name’. As the company grew, we realized there was a need to look for a unique name which establishes a distinct identity for the brand. As I had given the name Infotech, it was an emotional decision to go for a change. But when you build a brand, you also live and breathe the brand, it becomes your identity. Infotech no longer connected to the identity of the kind of work we were doing as we had become more technologically advanced and futuristic. Thus we decided to go for the rebranding of the company in 2013 and the process was completed in 2014 and the company was rechristened as Cyient (Client + Science + IENT).
What is your view when you look back at the growth of the India digital story?
We live in a generation where technology is at its best form. There are several disruptions taking place in current technologies and we see new innovations every day. One of the key drivers for the frequent breakthroughs in technology is digital connectivity. We now live in a highly digitally connected world.The implications of India getting digitally connected and digitally enabled are enormous and I am happy that the government is recognizing this fact. Digital India is a great initiative by the Government of India and has three broad components to it – Digital Connectivity, Digital Content and Applications, and Digital Literacy. If this programme can be implemented well, India will leapfrog to compete with many countries in the west.
You have been the Chairman of the National Association of Software and Services Companies (NASSCOM), please share some key highlights of your role in this capacity and some of the major initiatives that you took up during your tenure?
As Chairman of NASSCOM, I set three major objectives for my one-year term, empowering sectorial councils, engaging membership and making it inclusive for the SME sector. On empowerment, during my tenure, NASSCOM constituted seven sectorial councils, and democratized two councils through elections. Each of these sectors within NASSCOM (IT services, BPM, ER&D, Product, GIC, Internet and e-Commerce and Domestic) have grown substantially and needed closer attention. By empowering them through a council structure, we made it possible to give due attention to every sector. Also, by instituting a membership survey, creating a web portal and by meeting members often, the engagement with members increased. Similarly, since the NASSCOM Executive Council did not have representations from Small and Medium Enterprises, we invited two of our SME members as permanent invitees to EC. With this initiative, we brought in inclusiveness in NASSCOM.
What impact does India and Indian IT industry face in the light of restriction by the US and British economies?
The US and the British economies have so far not imposed any major restrictions so I don’t see any huge impact on the Indian IT industry. There are only some disincentives that they have created. For instance, the US government has increased the H1B visa fee and the UK government has increased minimum wages for temporary visa holders. The Indian IT industry is working towards bringing the attention of the foreign governments towards the fact that Indian IT companies are actually net employment generators as they create direct new jobs in these countries and they are also helping customers (companies from these countries) to become globally competitive.
The IT industry seems to be losing some of its sheen due to global protective measures, automation leading to reduced job opportunities. What is your take on this and what are the new roles/opportunities that are opening up in the IT domain?
IT industry in India continues to do decently well. It is estimated that for the FY 2016-2017, it will grow by around 9% and will create around 150,000 net new jobs. The volume of revenue in absolute terms is growing year after year. Jobs may not be growing linearly but they are not stagnant. Keeping the changes around the world, Industry certainly needs start investing in re-skilling or updating the skills of their workforce. However, today many industries consume technology and they are creating more new jobs. For example, Uber is not an IT company, but is built on a technology platform with a few hundred software engineers. But those are not the only jobs in Uber it has created several hundred jobs for drivers, who have additional qualification/skillset to be able to use computer apps for navigation, billing, etc. So IT industry may not be creating huge amount of jobs directly like in the past, but industry in general is enabling more job creations by using technology.
What will be the focus areas for the IT industry in the days ahead keeping all global factors in consideration?
The IT industry has to focus on re-imagining and re-skilling. They need to look at new service offerings in this digitally connected world. They need to re-skill their workforce and equip them for a changing world and new digital technologies. Indian industry needs to promote innovation and entrepreneurship to ensure that they have a strong play in the new world.
You have been actively involved in growing the start-up ecosystem in the country, please share your views on how startups are changing the game in India?
Technology disruption is the new normal. The velocity of disruption is increasing while its predictability is decreasing. We see new technologies coming up very often. In a rapidly changing world, innovation and entrepreneurship are the key to a successful future. Startups have to be nimble footed and agile which makes them more adaptive towards change. Innovation can be faster in start-ups than in large traditional companies. Start-ups are also huge employment generators today which are a need of the hour for our country. We therefore, need to create more incubators, accelerators, etc. to give them the required boost for further growth. In this direction, along with the mentoring that I have been doing for multiple start-ups and was also instrumental in conceptualizing and creating T-Hub – the largest incubation centre in the country. At T-Hub, we have 150+ companies being incubated. In addition to co-working space, they are supported with mentors, support services in accounting, legal and in fund raising. This gives them the required eco-system and guidance that is necessary for their growth
You have been appointed as the Honorary Consul of Germany for Telangana and Andhra Pradesh. What will this role entail you to do?
As the Honorary Consul of Germany for Telangana and Andhra Pradesh, I have multiple roles to play. I will work towards further strengthening the collaboration between the two nations; promoting culture, industry & commerce, facilitating investments, educational exchange and enhancing goodwill. I am also involved in cooperation in areas such as Skill Development. I also have some consular duties that include providing limited consular assistance in the state of Andhra Pradesh and Telangana and support the German citizens within the two states.
What are the industry verticals that you see the most growth in?
Technology has become pervasive in all areas of life and is impacting every industry vertical. Technologies of future such as automation, artificial intelligence, augmented reality/virtual reality, internet of things, Robotics/Bots, etc. have application in multiple verticals including BFSI, healthcare, education, agriculture, retail, and many more. I, therefore, believe that all of these and many other industry verticals will grow in coming years primarily based on the usage of technology.
If you had to do a SWOT analysis of the IT industry – what would you say are India’s strengths, weaknesses, opportunities and threats?
A key strength is that this is an industry which is more than 100 billion dollars in market size and captures over 56% of global outsourcing market makes it one of the strongest player in the world in this domain. Weakness would be poor acceptance of technology in the domestic markets is a definitely an area that weakens the opportunities for Indian companies locally. Opportunity lies in the fact that IT spend globally continues to rise with technology interventions and as anticipated it could double in the next five years so there is plenty of opportunities for those wanting to capture them. The threat lies in that at least a million out of the four million workforce require re-skilling and need to become updated as per the demand of the current times and industry needs to consider this as a priority as it can threaten their future prospects if not addressed timely.
You have so many awards and recognitions to your credit and now the latest being India’s 4 highest civilian honour – the Padma Shri. What do these awards mean to you?
Awards and recognitions certainly bring more amount of responsibility to your shoulders. Awards and recognitions are not just an acknowledgement of the work you have done or your contribution to an industry, country or society but they are force multipliers and motivators for the younger generations to aspire for similar achievements.
What does success mean to you?
At any point of time, success to me means satisfaction. I set a goal, I make a plan and I put in relentless effort to reach that goal. When I reach my goal, I feel very satisfied and happy with myself. The outside world calls it success. For instance, my goal was to create a global organization which is sustainable, is generating employment opportunities, getting the country its due recognition on the global map and with Cyient I feel I did achieve that goal. I feel extremely content with the journey of last 25 years so I would like to believe I was successful in what I set out to achieve.
Cyient entered a new phase of growth couple of years back when company not only underwent a brand change but also saw a smooth succession with your son Krishna Bodanapu taking over the reins. How do you think your succession plan has worked out for the company? What is your advice to your children?
I think the succession plan has worked very well for the company. The fact that the company is growing successfully and also that the fact that I spend lesser and lesser amount of my time on the company today makes me believe that the new leadership has found its stride and are progressing successfully. One of the key mantras of the succession that I would like to share is that, if one truly believes in handing over the reins to their successor, he/she should develop other interests and allow the successor to have his/her way in leading the company to the next phase of growth. My advice to not only for my children but also for future generations is that values should come first personally and professionally. If you lose your wealth, you can always get it back. If you lose your health, it is difficult to get it back, but still possible. If you lose your values, you will never get them back. Values driven leadership has always helped organizations to be successful even in the most difficult times.
What is your future vision for Cyient?
Currently, the size of the engineering services business is around $10.8 Billion. Companies have recognized the potential and the opportunities available in this domain. There are approximately 1000 engineering services companies in India wherein close to 600 are third party and Cyient is leading this pack. What makes Cyient different and relevant even in today’s competitive scenario is the first mover advantage, emphasis on innovation, consistent quality and more importantly the long standing relationships that Cyient has with all its clients. Cyient is in its next growth phase which I call as Cyient 3.0. In this phase the emphasis is on Design Led Manufacturing DLM- wherein Cyient not only designs engineering solutions but also has the capabilities for high value precision manufacturing of prototypes. The company has adopted a strategy internally known as ‘Design – Build – Maintain’; which allows Cyient to be a part of the entire product life-cycle management.
What is your advice to young people who want to be entrepreneurs?
My advice to young entrepreneurs is never be satisfied with status-quo, push the bolder step-by-step up the hill to attain success, live a happy blessed life and do what you are passionate about and be distinctively different. Entrepreneurs start with a vision but the path to achieving it, is rarely a straight line so stay agile and nimble footed. Innovation needs to be in the DNA of every entrepreneurial venture.
What are some life’s lessons that you would like to share?
In close to five decades of my career, there are several life lessons that I have learnt. I believe optimism is a force multiplier and attainment of goals looks simple thereafter. Also never give-up as life always has its ups and downs and it is easy to give-up during the low tides but difficult to retrace. Remember slow and steady wins the race and cutting corners and attaining fame hurriedly will not leave you there for good. Most importantly values and ethics come before everything else.
What do you like doing outside work?
From the day I started my career, I had a gruelling life, spending 16-18 hours a day at work for several decades and it was a choice that I made not a compulsion. Now that I have highly competent leadership at the helm of affairs at Cyient and I don’t have to be involved in day to day operations, I am spending a lot of my time to pursue some of the passions that I always had – Education, Entrepreneurship and Social Welfare. Currently these three areas have my active involvement in terms of my time and my money. Through Cyient Foundation, our intent is to improve the quality of education therefore we have adopted 16 government schools in and around our facilities in Hyderabad and presently we support close to 11,000 children from primary education to high schooling. In recent times, Cyient has started exploring areas where it can use our skills set – specifically on public healthcare systems and digital literacy. It leverages its engineering capabilities to develop low cost technology products for diagnosing eye diseases. Cyient Foundation is also running Cyient Digital Centers (CDC) as part of the National Digital Literacy Mission to empower neighbourhood communities with digital literacy. Through the Skill Development initiative Cyient Foundation takes the lead in making more Engineers Employable, the intent of which is to groom engineering students and help them acquire industry-relevant skills. Beyond this, I love to spend quality time with my family, my wife who has been a pillar of support all through my journey, my mother who is my inspiration, my children and my grandchildren.
This cover story appeared in Millionaire Asia Mar-Apr 2017 here: Cover Story