Indian Economy News

Cognizant revamps cloud business, sets up digital laboratories

Bengaluru: US-based Cognizant Technology Solutions has undertaken a reorganisation of its digital and cloud computing businesses, creating a new business unit called Digital Works, and tasked company veteran Malcolm Frank to head the newly-created unit, at a time when customers are redirecting an increasing proportion of their technology budgets towards newage digital projects.

The Teaneck, New Jersey-based company has rolled up its social, mobility, analytics & cloud (SMAC) business, its Centre for the Future of Work, and its digital consulting business and brought them all under one umbrella, creating this new business unit, according to two people directly aware of the plans. Both of them requested anonymity.

Under the new structure, the emerging business accelerator (EBA) group, which was personally incubated and is overseen by chief executive Francisco D'Souza, will also work closely with Digital Works. The EBA programme includes a portfolio of 18 cloud-based platforms and products and is currently being used by over 150 clients of Cognizant.

Cognizant, which has most of its 2,11,500 employees in India, has also poached several top executives from rival companies, such as Infosys and HCL Technologies, to strengthen Digital Works, including Kevin Nicholas who used to head digital transformation at Infosys, Timur Asar from Adobe and Eoin Russell & Ted Shelton from PricewaterhouseCoopers.

Cognizant did not provide any additional details on the reorganization, as the company is in a so-called silent period ahead of its firstquarter results announcement in May. In a February interview with ET, marketing and strategy chief Frank had said that Cognizant would look to grow its digital business through tie-ups and partnerships.

"Building partnerships is a core competency of ours. We always deal with an ecosystem — we work with Microsoft, SAP, Oracle. In digital, it means there are more potential partners," Frank had said.

The Digital Works team mostly comprises data scientists, design thinking experts, tech architects, smart programmers and coders and technology consultants -- this team works with all of Cognizant's verticals and builds customized tech solutions for each of the verticals. "It's true digital is new but the foundation it is built on has been around —programming, architecture, etc. So getting the next level of leaders and managers is not that hard," Frank said.


Separately, Cognizant is also creating 'Digital Labs' all across in locations such as San Francisco, with a new digital lab coming up in Manhattan, New York. In these labs, clients and company executives brainstorm on next-generation ideas, which are then incubated within those labs and customized solutions are created for clients.

Reorganisation of Cognizant's digital and cloud businesses comes at a time when software exporters such as TCS and Infosys are scrambling to earn more from high-value futuristic projects by solving new-age business problems faced by clients.

For years, Cognizant along with rival Indian software exporters grew rapidly by winning large outsourcing deals that required armies of software engineers to write thousands of lines of code to maintain and develop back-office software projects for large Fortune 500 companies such as Citigroup and General Electric.But with the technology landscape evolving rapidly, large customer organizations are now getting disrupted because of newer technologies, forcing them to seek solutions that can help them fend off new-age, tech-savvy companies like Amazon and Facebook.

Companies are, therefore, spending top dollars in identifying and grooming the creme-dela-creme of technology talent that can take up challenging, futuristic projects.

India's second largest software exporter Infosys, for instance, has created teams of 'super ninjas' or domain specialists and also started a programme called Expert Track that will raise expert coders who are capable of solving any technology-related problem. "Business transformation at scale in digital era requires approaches, skills and capabilities that are different from traditional IT services," CEO D'Souza had said in the company's last earnings call. Cognizant generated about $500 million of annual revenue from SMAC businesses in 2013.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.