Essential No. 2: Redefine Your Market

How are you redefining your market opportunity to identify growth during challenging times?

By David G. Thomson

In early 2008, as I was preparing for a global keynote speech and workshop tour across Asia, sponsored by Lloyd Adams, vice-president of marketing for SAP (SAP) Asia Pacific and Japan, I was challenged by him to tailor The 7 Essentials for audiences from different countries and cultures. Identifying a global success pattern would serve as an additional and even more powerful indicator that the management and financial fundamentals needed to achieve exceptional growth are universal; independent of economic cycle, industry, and country and culture.

So I asked myself, "Where could I find a billion-dollar company example in Asia that meets all the criteria?" Fortuitously, during a presentation and discussion that I made at SAP Labs in Silicon Valley a few months later, I met Anubhav Saxena, HCL Technologies' global vice-president of marketing, who excitedly told me that HCL's CEO, Vineet Nayar, had launched a growth initiative called "The Blueprint" in July 2005. (He had named and launched his initiative without any knowledge of my work, but I took the similarity as a good sign.) I checked it out, and HCL Technologies was following The 7 Essentials. I had the example I needed!

India-based HCL Technologies entered the global IT outsourcing market in 1999 following its initial public offering and has since become a global leader in IT services, achieving $1.7 billion (U.S.) in revenue early 2009, up from revenues of $118 million in 2000. It has become one of the leading IT outsourcing companies in the world and has been ranked by BusinessWeek as one of the world's top 20 most influential companies along with the likes of Google (GOOG), Wal-Mart (WMT), and Toyota (TM).

Journey is Rarely Smooth

I had the opportunity to interview Nayar first by phone and later in person when he and I were part of a panel on growth in New York in June 2009. And as he relayed HCL's story to me, it was testament to the idea that the journey to achieving exponential growth—across, up, and down economic cycles—is rarely a smooth one. While HCL Technologies had experienced growth during the 1990s in software and IT outsourcing, by the early 2000s, its growth had fallen behind that of IBM (IBM), HP (HPQ), and some of its Indian competitors. HCL's founder correctly attributed the company's success to momentum of the past.

With HCL Technologies' revenues still lagging at about $750 million, Nayar had his work cut out for him. Following his transformational blueprint, Nayar knew he had to do three things: 1) Identify large market opportunities; 2) leverage alliance partnerships; and 3) create exceptional value for customers.

The critical question facing him at the first strategy meeting in July 2005, was "How do we get a big piece of the core IT outsourcing market?" His answer was provocative. "Since the market is stagnating, we will have to inject a catalyst inside it and redefine it to create an exceptional growth market," he told his staff. The idea was to do something that would redefine an exponential growth market segment opportunity within an outsourcing market that was basically stagnant.

Frustrated Corporate IT Customers

First, HCL had to refocus from its many revenue-producing smaller and mid-market customers to target global contracts with the world's largest enterprises against large, global competitors. Interviewing this strategic customer set, the exceptional growth opportunity turned out to be delivering outstanding quality and flexibility.

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