{"id":5453,"date":"2023-06-04T16:23:28","date_gmt":"2023-06-04T16:23:28","guid":{"rendered":"https:\/\/www.horsesforsources.com\/?p=5453"},"modified":"2024-09-11T10:41:55","modified_gmt":"2024-09-11T10:41:55","slug":"cognizant-mojo-resurrection_060423","status":"publish","type":"post","link":"https:\/\/www.horsesforsources.com\/cognizant-mojo-resurrection_060423\/","title":{"rendered":"Cognizant gets savvy with Ravi to resurrect its mojo at the intersection of industry and technology"},"content":{"rendered":"

\"\"<\/p>\n

Many people have viewed Cognizant as losing its mojo over the past few years, with staff attrition among the worst in the services industry last year, a demoralized Indian organization, and a general lack of raison d\u2019\u00eatre<\/em>.\u00a0 What had been the poster child for modern offshore-centric outsourcing for a decade and a half has struggled since activist investor Elliot Management squeezed the life out of the firm in 2017.<\/p>\n

\u201cWhy Cognizant\u201d. Can the poster child for spectacular offshore-centric services growth find a new raison d\u2019\u00eatre?<\/strong><\/p>\n

Fast-forward to 2023 and the firm has a charismatic new CEO at the helm, Ravi Kumar S, who is looking to reinvigorate the firm\u2019s culture while also setting out a new course for growth in the era of The Generative EnterpriseTM<\/sup>.\u00a0 A noticeable uptick in bookings this year is already indicating that the Cognizant mojo is starting to reemerge.<\/p>\n

Back in the good old days, the firm could do little wrong by challenging Accenture\u2019s strategy \u2013 driving a hard-digital bargain and offering a simplified approach that many clients wanted:\u00a0 easy to partner with and able to deliver what they wanted at much more competitive rates.\u00a0 In short, many clients wanted to work with Cognizant because they loved the energy and simplicity of the firm, which was in stark contrast to the consulting-led arrogance of the transitional IT services model.\u00a0 Simply put, client-centricity was always the table stakes for the firm during its rampant growth days.<\/p>\n

Cognizant had achieved what most of the industry still fails at today: Everyone understood the \u201cWhy Cognizant\u201d, versus just the \u201cwhat\u201d and the \u201chow\u201d. <\/strong><\/p>\n

In fact, Cognizant can genuinely lay claim to \u201cinventing\u201d digital with its\u00a02012 \u201cSMAC\u201d stack philosophy<\/a>, which was swiftly followed by\u00a0Accenture\u2019s 2013 re-branding the SMAC stack as \u201cdigital\u201d<\/a>.\u00a0 \u201cThey think like we do\u201d was one of Accenture\u2019s leaders’ declarations at an analyst briefing in 2016.<\/p>\n

Sure, Cognizant, at $20bn, still has an array of outstanding capabilities, but without a clear message to the market, it has become difficult for enterprises to understand what makes the firm a desirable transformational partner that can deliver both cost and innovation impact. \u00a0Winning by embracing heritage means reinforcing the three strong strengths in its roots \u2013 a confluence of industry and technology, flexibility and client centricity and entrepreneurial spirit<\/p>\n

The firm needs a new identity, renewed direction, and a reenergized culture to reclaim its former glory.\u00a0 However, the precise ingredients that provided the magic formula in the past may not be the right ones in the medium-long term as the services industry faces the vast dichotomy of transforming clients at speed and pre-inflationary prices.<\/p>\n

Enter new CEO Ravi Kumar S, former Infosys rainmaker, ready to right the ship. The HFS team descended on Cognizant\u2019s 2023 US Analyst and Advisor Summit \u2013 the first significant analyst event since Ravi took the helm \u2013 ready to hear the master plan.<\/p>\n

Victimized by its past success, Cognizant became encumbered with low-value work while lacking a spark to attract new business.<\/strong><\/p>\n

Cognizant is the firm that made digital real for various industries over the past two decades. Its digital focus purveyed a powerful value proposition for clients and investors, yielding substantial dividends, revenues, and profits. But as digital became Horizon One table stakes, Cognizant became encumbered with supporting technologies, processes, and agreements associated with yesterday\u2019s<\/em> tech \u2013 not the tech business was adopting to innovate and adapt for future growth.<\/p>\n

A spark is needed, and Ravi\u2019s team doesn\u2019t disappoint. <\/strong><\/p>\n

HFS heard a well-articulated vision where Cognizant is pushing forward with a unified leadership, a focus on building talent for new solutions, and their role in becoming a leader in unleashing the next wave of engineering via artificial intelligence, automation, and domain knowledge. With this in mind, Ravi\u2019s Cognizant is planting itself squarely at the confluence of industry and technology, with software as the new alchemy.<\/p>\n

Steaming ahead into the next era of growth is predicated on Cognizant\u2019s success in aligning platforms to industry outcomes for its clients<\/strong><\/p>\n

Cognizant\u2019s alchemy is based on three big bets, these are:<\/p>\n

    \n
  1. Building unparalleled industry-centric<\/strong> delivery based on a platformed approach to create modern organizational models for its customers.<\/li>\n
  2. Helping customers operationalize AI-based offerings<\/strong> to automate, accelerate, and anticipate market opportunities.<\/li>\n
  3. Becoming an employer of choice<\/strong> for new and diverse talent, skills, and experiences.<\/li>\n<\/ol>\n

    Executing these is essential to winning the big deals and re-establishing its leadership status. To do so, Cognizant will \u201cmeet clients where they are\u201d by bringing flexibility and a willingness to embrace new engagement models. In addition, its experience in outsourcing and insourcing creates a foundation for them to take advantage of a major upswing in demand for new skills around enabling technologies bringing its customers capabilities to address their skills gaps. And a renewed executive focus on identity, empowerment, and direction to attract and retain skilled teams in next-generation technologies.<\/p>\n

    Engineering and platform skills are critical enablers at the intersection of industry and technology. <\/strong><\/p>\n

    While Cognizant promoted new solutions like Neuro ITOps, Neuro AI, and Skygrade, what HFS found more interesting was Cognizant\u2019s promise to execute from an industry platform angle to bring tools, engineering, and platforms to market. Examples include Trizetto Healthcare, Utegration Utilities, Asset Performance Excellence (APEX), and Car-to-Cloud Automotive.<\/p>\n

    These are being co-created with customers, improving acquired assets like Trizetto, discovering ecosystem opportunities across IoT, semiconductor, and automotive with C2C, and harnessing data and insights for boosting performance and process industrialization. HFS believes the key for Cognizant is to replicate its proven healthcare ecosystem playbook into other industries which are immersing deeply into tech-led products and services.<\/p>\n

    Cloning this success will depend upon linking its platform and engineering solutions across its technology verticals to deliver cost-effective \u2018run-time\u2019 models for current and future customers. Further, building modern solutions includes embedding cloud, hyper-automation, and generative AI models into these platforms to help clients create \u2018the generative enterprise.\u2019<\/p>\n

    The Bottom Line: Cognizant is not out of the storm yet, but Ravi Kumar has taken an active role at the helm. He has elevated talent in his team to press forward with haste to deliver new value to existing clients and promote a vision of value creation to prospective clients.<\/span> <\/strong><\/h3>\n

    Cognizant\u2019s industry intersection with technology provides focus. However, the proof will be their ability to lean into industries and deliver solutions and services in a consistent, business outcomes-based manner. Cognizant may find its greatest challenge in execution as none of the senior leadership team is from industries. The firm needs real investments internally in talent to create a new energy and culture that has been lacking in recent years.\u00a0 The signs are encouraging in some specific industries that renewed energy is coming with new hires imminent, but this is a marathon change imperative that will take years, not months.<\/p>\n

    The competition and the availability of winning large deals won\u2019t be easy. The challenges of attracting and retaining talent, aligning the solutions across their business silos, and harnessing the next generation of digital engineering with AI are all very complex. Conquering them all will take a deft hand, skilled sales, and a clear view of delivering customer success based on business outcomes over technology. While Ravi has made some changes, he has yet to put his stamp on the organizational structure and leadership team. We suggest this could use a significant industry pivot.<\/p>\n

    Regardless of these challenges, HFS finds itself bullish based on our conversations with layers of management who now share a shared vision and belief that Ravi\u2019s commitment to winning will reshape Cognizant and bring it closer than ever before to its customers in its time of need.<\/p>\n

    However, when the problems cut this deep, you can\u2019t just apply lipstick to the pig, you need to reconstruct the whole farm, or you can quickly find yourself in the zombie services category alongside the likes of Conduent and DXC, where finding any sort of direction and impetus would be a significant accomplishment.\u00a0 Ravi has performed a rapid three-point-turn of the aircraft carrier; now, he needs to hire some new fighter pilots as he sets the firm on this new course.\u00a0 Smart acquisitions will also need to be evaluated astutely \u2013 as these can make or break Cognizant.\u00a0 However, when you consider its stock price under half the valuation of Infosys\u2019, there is a huge amount of room to increase the value of the firm and its standing in the industry.<\/p>\n","protected":false},"excerpt":{"rendered":"

    Many people have viewed Cognizant as losing its mojo over the past few years, with staff attrition among the worst…<\/p>\n","protected":false},"author":3,"featured_media":5455,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[867,959,879,48,876,81,1058,833,858,1050,100],"tags":[619,999],"organization":[232],"ppma_author":[19,27,31,34],"class_list":["post-5453","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-artificial-intelligence","category-automation","category-bfsi","category-business-process-outsourcing-bpo","category-healthcare","category-it-outsourcing-it-services","category-manufacturing","category-oneoffice","category-global-workforce-and-talent","category-the-generative-enterprise","category-utilities-resources","tag-phil-fersht","tag-ravi-kumar","organization-cognizant"],"yoast_head":"\nCognizant gets savvy with Ravi to resurrect its mojo at the 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