'More than 10% of our new hires to come in from the tier-2 cities': CP Gurnani

Pune-based IT services major Tech Mahindra Ltd is betting big on the opportunities provided by 5G and digital transformation. It has recently also forayed into the metaverse space with the launch of TechMVerse, to offer interactive and immersive experiences to customers. As it builds a digital-ready talent pool, it is expanding into tier-2 cities to find and attract the best of talent. In an interview with Mint, C.P. Gurnani, MD and CEO, Tech Mahindra talks about what’s driving the demand, its foray into the metaverse, and hiring strategy. Edited excerpts:     

How do you see the overall demand environment and in which areas are the clients spending on?

It is very clear that 5G and digital transformation are driving the demand. And clearly the legacy stacks are moving towards the cloud. When it comes to engineering, there is a demand towards electric vehicles. The third demand driver is cyber security and the fourth driver is sustainability. So, in general, I would say that 5G, experience design, and ‘phygital’ (a combination of physical and digital) are driving consumption. 

What are your hiring plans for next fiscal including your strategy to hire from tier-2 cities?

We don’t share hiring forecast numbers but we have opened up a lot of new centres in tier-2 and tier-3 cities. For example, we have opened up international centres in places like Latvia, Romania, and Costa Rica. We expect more than 10% of our new hires to come in from the tier-2 cities. It is helping us attract talent. We believe that the level of skills is extremely good and the attrition rates are much lower. We are decisive about expanding our global reach through tier-2 cities. In India for example, very good talent is available in places like Bhubaneshwar, Chandigarh, Kolkata, Indore, Vijayawada, and Coimbatore.  

Tech Mahindra recently launched its metaverse offering. How do you intend to take it to your clients?

One of our key focus areas is helping our customers’ digital journey and technology is helping us build the differentiators. Metaverse is clearly a key differentiator. Like any other new technology, our metaverse offering will be initially incubated in a smaller group and then shared with our clients because for most of them, it is also a new way of running their business. By definition, you are now saying that you have redefined the universe to become a meta universe. We believe initially our metaverse offerings including DealerVerse, metaverse-based car dealership; Middlemist, our NFT marketplace; or Meta Bank, a virtual bank, will be run as a separate unit. But eventually it will work together with various verticals.  

Which industries are the early adopters of the metaverse?

The first one really is the gaming industry which comes under our media and entertainment vertical. The second one is healthcare and the third one is retail. I don't think we have seen much adoption in the manufacturing sector immediately. But we have clearly seen it in banking. We are also seeing it in dealer management and on NFT marketplace.  

You have made about eight acquisitions in FY22. What’s driving those and what’s your acquisitions strategy going forward?

From a strategy point of view, our mergers & acquisitions (M&As) have been driven by capability building, portfolio de-risking, and geographic expansion. I am not trying to say that I want to be effective in all markets but I want to take advantage of my clients requiring a presence there. Some of the recent acquisitions include Com tec Co IT (CTC), Infostar LLC, We Make Websites (WMW), DigitalOnUS, and Activus Connect.  

What could be the impact of the Russia-Ukraine war on Tech Mahindra and the Indian IT sector?

If you look at it from a purely mathematical point of view, there is no direct impact because the Indian IT sector is not really dependent on either of the two countries. I am sure there will be an overall impact on the global economy. There could also be an advantage because some of the companies that were dependent on the talent in Russia and Ukraine may want to de-risk and come to India. But we consider this to be a very unfortunate event. We do not have employees or offices in Ukraine and Russia, but we feel bad. We are not a company that wants to look at opportunity because of war unless a client comes to us and asks for help.