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Updated: November 15, 2013 00:32 IST

Ramco Systems recasts strategy to boost growth

Staff Reporter
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Virender Aggarwal
Virender Aggarwal

Ramco Systems has put in place a new strategy to get the company out of the low growth tag. The new game plan will see the company give a renewed push into international markets and increase marketing spend significantly. It has also taken a conscious decision to put several sub-product areas on the back-burner.

The software product company, which has reported losses for the last few quarters, has enrolled over hundred partners over the last six months, and ramped up its teams to address international markets such as Middle East and Africa.

Despite ramping up the company’s user-interface team, the overall headcount has decreased by 200 over the last year. Most of the decrease has been natural, according to officials.

“Indian software product firms generally have failed because they build a product, but don’t market it well. We’re consciously pushing into global markets now… a decision that will see our investment in marketing eventually jump from the current 8% of sales to 25% of sales,” said CEO Virender Aggarwal, who was hired last year to set the ship right. He was addressing reporters here on Thursday.

According to Mr. Aggarwal, the company has also consciously decided to not position its products at a lower price, as “building a brand requires positioning it properly”.

Mr. Aggarwal, who was previously with HCL Technologies, pointed out that the company had built many products which would not have seen the “light of the day”.

Consequently, Ramco has put several sub-product features and areas on the back-burner. It has instead decided to focus on growth areas that have larger addressable markets.

Three focus areas

For instance, Ramco’s three focus areas now are: ERP, HCM (Human Capital Management) and aviation. The company is now awaiting market regulator SEBI’s nod for its proposed Rs. 120 crore rights issue to meet its capital requirements.

“Losses are narrowing as we run the business more prudently. While we have no time-line [on returning to profit], our order bookings are encouraging. We have more [bookings] in the first six weeks of this quarter than what we sold totally in the last quarter,” he said.

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