Mindtree Ltd has been reporting strong growth over the last few quarters. In its fiscal third quarter earnings last week, the Bengaluru-based IT services firm reported a sequential revenue growth of 5.2% in constant currency, making it the fourth consecutive quarter of more than 5% revenue growth in constant currency terms. Its order book was up 14.6% year-on-year at $358 million, taking the year-to-date total contract value (TCV) to more than $1.2 billion.
In an interview, Debashis Chatterjee, CEO and MD of Mindtree, talks about the demand environment, pricing environment, and hiring outlook. Edited excerpts:
What is the outlook for the next few quarters?
We have consistently reported strong growth over the past several quarters on the back of growing demand, aggressive customer mining, and end-to-end digital transformation capabilities. The demand environment for our digital transformation services and capabilities continues to be robust and broad-based. Our strategy of growing existing relationships, diversifying our customer mix, and strengthening industry partnerships is delivering visible results. We are executing our strategy with great operational rigour and discipline, while investing significantly in adding to our domain, digital and marketing capabilities.
Our ability to upsell and cross-sell in our existing engagements, while going after new logos is working well. Our endeavour is to continue to deliver industry-leading profitable growth and we are confident in our ability to sustain strong revenue momentum.
In which areas do you see your clients spending in calendar year 2022?
While it is too early to comment on customer budgets because most of them have just started planning for calendar year 2022, it is clear that the spend on digital transformation and hyper-personalisation will continue to expand and accelerate. These investments are being driven by long-term strategic imperatives, mostly independent of market cycles. Across sectors, the focus is on delivering modern enterprise architecture, resilient infrastructure, scalable digital-ready foundation, and innovative experiences for competitive differentiation and revenue maximisation. This trend is translating into opportunities for us across all our service lines from customer success, data and intelligence, to cloud and enterprise IT. Customers want to reach the end-state of their digital transformation initiatives faster than planned. They are looking for flexible, nimble and “transformation-first” partners who can help them scale and scale fast. This is where we enjoy a distinct edge.
How is the pricing environment, both in traditional and digital deals?
The pricing continues to be stable with an upward bias in deals reliant on premium digital skills.
Please share your hiring plans for FY23. Also, what skillsets are you looking for?
The broad range of career and development opportunities resulting from our growing and diverse client, technology and geographical footprint makes us an attractive employer. We onboarded more than 4,500 employees in the latest quarter, taking our global headcount to more than 31,900.
To meet the growing client demand for our services, we have re-energised our recruitment engine. We are not only on track to meet our aggressive hiring targets for FY22, but also expect to significantly dial up hiring in the coming quarters across digital capabilities. Our rejuvenated campus hiring program will see us visit more campuses than ever in our history. As a result, our hiring momentum from campuses is expected to increase by 40-50% through FY23.
Mindtree EDGE, our unique learn-and-earn program for BSc and BCA graduates, continues to progress as planned. By remodelling and strengthening our flagship training program for fresh graduate hires, we have accelerated freshers’ deployment to client projects. Our employee referral programs have been a huge success.
What measures are you taking to contain the high attrition rates?
Even in a competitive talent market, we have been able to differentiate ourselves with our ability to bring innovative ideas and future-ready talent to support rapidly evolving transformation needs. We are reorganizing ourselves to turn this differentiation into an even stronger competitive advantage.
As we enter the next phase of growth, we are strengthening our employee value proposition by driving a talent mindset across the organization and making talent an integral part of the organizational fabric. An important step in this direction is to bring the entire employee lifecycle — ranging from outreach and recruitment to career development — under an integrated talent function. This is aimed at enhancing employee experience and engagement.
We are continually building upon our people-centric culture in line with our work ethos centred on purpose, caring, learning, and delivering results. Our focus continues to be on complementing external hiring with internal talent development. A vital part of this has been the success of our all-round focus on learning. For example, external certifications went up by 50% in the last quarter alone. Measures such as a redefined career framework and role rotations continue to facilitate rapid, more effective career enablement.