Having bagged large deals in the last few quarters, L&T Infotech CEO & MD Sanjay Jalona says the nature of the deal pipeline is changing as customers are increasingly looking at digital interventions in a pandemic-hit marketplace that requires them to embrace ‘restructuring’. Edited excerpts:
What is the current market reality?
In the last 100 years, the world has witnessed three major economic turning points. The first one was the Great Depression of 1929, then came the Great Recession of 2007, and we believe what we are going through right now is the ‘Great Restructuring.’
We call it the ‘Great Restructuring’ because every aspect of our life and work is going through a change. The way we interact, collaborate, learn, deliver and expect value is changed forever. It is going to have a profound impact on the future of work, workplace, and workforce. The ‘Great Restructuring’ is comprehensive, because no industry, no company, and no country is isolated. Everyone must adapt or cede their position.
How are you positioned to explore this opportunity?
Looking at the convergence of market trends and capabilities, we feel cloud and data products are two key areas that present huge opportunities for industry players.
Accordingly, we have created two separate units to cater to these opportunities and these units will be the critical growth engines for us in the next 3 to 5 years. Additionally, we see four themes emerging as top priorities of customers: enhanced empathy (by improving loyalty models), improved productivity (through a more distributed mechanism), building resilience (by saving money to fund new operating models) and increased agility (by speeding up time-to-market). Our consulting-led initiative (The Grit Alliance) is helping us harness the opportunities that these dominant themes present.
What is your strategy for big-ticket deal wins?
L&T Infotech (LTI) closed FY21 with a record net new TCV (total contract value) for large deals. In Q4, we won two large deals. One, a vendor consolidation engagement in the insurance space that came with a net TCV of $21 million over five years. The other deal involves one of the world’s largest Islamic banks where we would be transforming its core banking functions with Temenos, a BFSI software firm based in Switzerland. This is a two-year deal worth $45 million. We have a mature ‘advisor relations’ function and partner with leading third-party advisers across the globe.
Are global customers comfortable with the rising portion of offshore?
We are certainly witnessing a perimeter expansion in what can be delivered remotely, with current models being challenged and expanded. Also, automation of work is resulting in smaller units and shorter cycles. Innovative tools and platforms developed during last year are making this shift possible and making customers more comfortable. For instance, LTI launched Canvas, our vision of the future of software engineering. It curates a comprehensive tech stack enabling multi-disciplinary teams of all levels, wherever they are, to work together on projects in a remote or hybrid environment.
What is LTI’s market outlook for FY22?
Tech spending across sectors is looking quite strong. Our industry-leading growth during the last few years, high exit velocity in Q4, large deals announced in the last few quarters, current pipeline, and incredible conversations with customers because of the ‘restructuring’ opportunity, positions us well for the next phase. With our focus on transformational offerings across all verticals and the opportunity to create value with Data, ERP and Cloud solutions, we expect to continue to be the growth leader next year and beyond.
Do you expect any systemic change around outsourcing under the Biden administration?
Early indications are positive, and we believe the administration will take the necessary steps to ensure that American enterprises remain competitive. We will continue to work with governments in the U.S. and India and support measures that ensure healthy relations between the two nations.
