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[Music]
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So uh Mr. Ara very uh very warm welcome
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to you uh to Wharton and knowledge at
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Warden. Thank you for taking the time uh
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to be with us here today.
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Thanks An. Um so would love to start off
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with uh getting a sense of about your
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company, your background uh and
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obviously given that you're in the BO
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industry just a high level overview of
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current trends in the industry, where
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you see it going, what challenges you
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faced recently given the economic
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downturn in some of your key markets.
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Yeah, I' I've been fortunate enough to
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be a part of the uh outsourcing industry
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rather than just keeping it restricted
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to the BPO industry in India since early
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99 pretty much since it was set up in
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India. Uh I worked with GE for for a
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significant period of time and then I
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really uh came on board onto Aegis where
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we started the whole journey of setting
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up a company which is to make it a
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little different. uh in the last six and
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a half years in AIS we've now achieved
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uh you know to hit about 52,000 people
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globally uh we are uh we we've done
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about 19 mergers and acquisitions
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now were you an entrepreneur before at
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any point in your lifetime
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you know actually I wasn't an
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entrepreneur but but most of my
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colleagues in Ages are entrepreneurs are
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they obviously are are very lucky to
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have the parentage of the SR group which
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is full of entrepreneurs so you know
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from a family point of view I come from
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a family of entrepreneurs. So maybe that
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became natural for me.
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But I think one unique uh you know
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composition that we have in the
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management team of a of ages is pretty
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much every single person is an
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entrepreneur.
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Okay.
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Okay. U so I think it's been a it's been
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a good story so far. If you look at the
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industry overall if you you know map it
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over the last 10 years uh we saw a large
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number of companies specific to India
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starting in the BPO space right? uh and
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over the last five to six years you see
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a lot of consolidation that's happened
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uh uh the the recession that hit
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I think overall the industry did see
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challenges in terms of the recession u
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you you know they did see with
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currencies getting stronger uh with
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companies specifically US companies
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starting to look at the whole uh
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offshoring uh you know with with a more
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closed uh eye I think I think some
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companies did face a challenge I think
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if Look at Aegis though our business
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model is extremely different. So we are
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not a pure play offshoring BO or
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company. Uh you know we've got for
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example over 5,000 people employed in
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the US which not too many people know
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about. U so we actually have operations
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in the US in South America in South
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Africa in Saudi in India Sri Lanka
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Philippines and Australia and leaving
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maybe a Philippines and a part of India
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which does both domestic work and as
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well as offshore work all the other
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countries actually support domestic
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work.
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Sure. So pretty much from a recession
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point of view that that that helped us
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uh not to let it impact us in a major
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way.
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Now a couple of very interesting things
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you mentioned. So first of all you know
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given that you have operations in so
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many different countries uh and
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increasingly a lot of Indian companies
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in different sectors are expanding
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abroad expanding their operations
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abroad. Can you share some lessons from
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what you have learned some management
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lessons that you have learned from
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having been running these operations
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abroad? What has worked well for you?
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What has not?
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I think I think the first key and
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narrower thing is that you know when we
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started there were uh there was a core
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team of about six of us that came on
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board within the first 12 months of
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starting ages. I think even today all
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six of us are intact and I think that as
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a fundamental is is the basic you got to
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have the foundation very strong. Other
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than that we obviously have a
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co-management team and we have a we you
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know you you you touch the word
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entrepreneurs. The way we run every
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country is we like to have a leader in
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that country who's like an entrepreneur
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and who runs it in their own uh uh
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model. We obviously have defined
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processes, defined systems to make sure
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that you know a customer they could be
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serviced from any part of ages. They get
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the same feel. But as far as the
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management teams go in each of these
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countries, they are local.
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Sure.
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You know it's it's it's pretty much like
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be a Roman in Rome. So if you go to
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Australia uh you will see the management
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team which is Australians and when you
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go to South Africa you will see a local
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team of South Africans but the
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foundation the processes the systems the
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IT and everything behind it is common in
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every single location of ages.
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Sure. Um and so what has not worked for
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you when you've or what are some of the
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you know hurdles you faced and what are
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some of the lessons you've learned as
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you try to expand abroad?
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You know I think we've done we've done
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19 mergers and acquisitions. Okay. U and
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and frankly speaking I think cross
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border cross border mostly u I think
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before getting into that there are
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basically majorly two reasons of why
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we've done so many acquisitions. Uh one
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to acquire or enter a vertical where we
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did not have expertise in
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uh so maybe for example could be the
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collection space could be uh you know
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you know tech help could be uh the IT
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space in terms of system integration
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second to have geographical presence.
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Sure. Once we do the two, we then you
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know let the organic engine kind of you
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know boost and and grow those
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businesses.
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Uh
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very early on when we started on our M&A
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journey uh you know we we we realized
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that the integration framework has to be
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really very strong.
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So the framework that we built uh uh
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after the first two or three
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acquisitions is a very detailed one. And
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we in fact won a award from NASCOM last
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year on it's called the five you know uh
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59 uh DNA really framework that we have.
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Can you share a bit more detail about
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that?
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So basically you know really if you look
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at if you look at any acquisition uh and
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and if you study the last 100
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acquisitions that have happened
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irrespective whichever geography there
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it is in um uh I would say more than 80%
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fail only because they did not do a good
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job in terms of integration. Mhm.
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Uh integration is not in our minds about
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acquiring a company on a piece of paper.
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It's not about you know combining the
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balance sheets or the P&L but it's
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really dealing with uh you know the
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emotions uh the emotional part which is
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a softer part of the aspect uh and you
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you got to really empower you know make
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people feel comfortable. U I'll take
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I'll take one or two examples. We've got
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colleagues of of ours who was who were
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probably running a small let's say a $20
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million company once they become a power
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of ages they now handle much larger
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roles and larger responsibilities
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uh uh you know you know you know pretty
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much at sometimes panning continents
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right
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um so I think I think you know that
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whole emotional part which which is
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there I think the connect which is we've
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been able to do that pretty well the 59
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framework which I'm specifically talking
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about is actually a very simple
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framework but um which is again it's
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pretty much focused a lot around people.
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It really says that in the first 9 hours
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when you acquire a company you need to
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roll out uh you know you make the
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announcement roll out the o charts make
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sure that there is there is no room for
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questions in terms of people that goes
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and the last nine would really be uh 99
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days which would really mean the entire
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integration and acquisition needs to be
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completed by them uh both in terms of uh
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legal financial as well as the people
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aspect. So for us irrespective whether
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it's a $10 million acquisition or it's a
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$150 million acquisition the framework
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would be the same and consistently
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across the board.
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So that's very interesting. So you know
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you mentioned that this was also
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recognized by NAS um so if I can just
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ask you to take your own individual
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experience you know with your company
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and how you've managed integrations and
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other management lessons you've learned.
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Can you start to generalize or at the
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more macro level if someone who is
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viewing Indian management practices or
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Indian management philosophy
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could you share some insights into what
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you think is unique about Indian
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management philosophy? Now I know I'm
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asking to generalize but if you could
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just offer some insights on how Indian
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management philosophy would let's say
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differ compare contrast against the
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management philosophies or practices of
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other western
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countries. Yeah. So I you know and I've
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had the the the fortune of working for a
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very large MNC in the past
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and and today I work for an extremely
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large Indian-based uh MNC uh and and I
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honestly feel that uh I would never
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trade again for for the two and and I
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say this uh uh for obvious reasons. one
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I guess the biggest management
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comfort that as as a part of a
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management team that you have working
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for a Indian Indian company is is is is
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one uh that you're not really just a SAP
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ID or or a or a kill ID you're not just
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ID number you know they really empower
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you and they enabled you to run your own
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business like an entrepreneur uh when we
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acquire companies we we understand that
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it's it's not just about letting people
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go uh it's about you know really doing
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the right stuff with the management
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teams, sitting with them, discussing
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with them and a lot of time is spent
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actually on soft aspects which which I
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feel is a big thing in terms of Indian
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best practice that I would take.
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Sure.
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U in any acquisition uh even before
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doing the M&A we would meet a management
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team for example uh and we would we we
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would take that commitment that they
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would stick with us for at least 18 to
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24 months. In some cases we walked out
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of a deal because those core people said
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they won't stick with it. Um so I I I
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think that's uniquely very different you
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know when when there are trouble times
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be the other good Indian management
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practice is they believe long-term they
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can look at returns more in terms of 5
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years and 10 years and not kind of panic
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and say what's going to happen next
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quarter
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right
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uh and that's another big uh comfort
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factor that you get uh you know you know
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working for an Indian company
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and now if I can flip that question
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around and ask you what's the one thing
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you would change about Indian management
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Indian practices
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you know I think uh for the for the firm
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that I work with the SR group I'll
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honestly say I think and and that would
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probably be a best practice for other
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Indian companies I think they've managed
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to strike a perfect balance between who
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runs the organizations and and what the
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role of a promoter versus the role of a
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management team that runs the company I
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think that whole structure is very well
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defined uh they they spent a large time
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over the last uh six to seven years in
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terms of defining that and I think as
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long as that is defined where you know
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what is the promoter's role okay and
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what is the management team's role and
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and and the management team has that uh
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you you know that comfort factor and the
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freedom to go and run the organization
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by itself I think companies will do well
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uh and that's something which MNC's in
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the western part of the world do really
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well
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sure well Mr. It's been a pleasure
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having you uh at for knowledge at
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warden. Uh thank you again for sharing
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uh your insights and also giving us your
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time. It's a pleasure.
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Thanks. Thank you.
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Thank you.
