Outsourcing Its Way To Success

Differentiation is key to our ethos, and we will ensure that we enhance the service and product experience of our customers through innovation.

Pankaj Mishra Sep 15th 2008 A-A+

Bharti Airtel, India's largest telecom firm by subscriber, has never been good at following the rules - which is probably why - in it's space - it is also one of the most profitable companies in the world. Manoj Kohli, CEO, Bharti Airtel, wants IT to help his company cope with the complexity of serving almost 125 million customers by 2010, and make Airtel the country's most admired brand. He also makes a point that Airtel's CIO led the ground-breaking move to outsource IT. It's an example of a business-centric outlook, which more CIOs ought to have.

 

CIO: Although it’s been a few years now, the scope of your outsourcing contract still makes it a landmark deal. What drove it and how has that relationship evolved?

Our outsourcing strategy had three objectives: giving our operations more scalability, gathering best practices from the world, and gaining telecom domain knowledge from across the world. We started with a few million customers, and the relationship addresses scalability up to 125 million customers by 2010. The objective was not cost savings, but building the future of our company by listening more closely to our customers. The relationship with IBM has been very helpful. What started as a deal to outsource our network has today expanded to IT, BPO and several other areas with six partners. While the growth of our business is handled by experts, our leadership team is focused on customers. Our experiences with outsourcing in the telecom business are now serving as a blueprint for structuring similar relationships in the new businesses Bharti Group is venturing into.

What role has IT played in Airtel’s evolution?

IT has to play a revolutionary role at Airtel. Our CIO, Jai Menon, is not merely an IT leader - he is playing an instrumental role in transforming our company. From almost 64 different platforms, we now have one integrated platform across our businesses. Our new products in the areas of DTH have also been successfully integrated with the front end. We now have an almost paperless office as well.

Jai has spearheaded IT's strategic role at our company, right from the time he was involved with structuring the transformation deal with IBM.

In a highly competitive environment, how do you ensure constant differentiation?

In our industry, tariffs are now vanilla - you cannot differentiate on that factor. In the coming years, you will see us innovate around new products and customer services. These are the two areas where Airtel, as a brand, is innovating continuously. Differentiation is key to our ethos, and we will ensure that we enhance the service and product experience of our customers through innovation.

 

You’ve gained leadership in the urban and semiurban markets, but what’s your plan to address the rural markets?

There are almost 700 million potential customers in rural India - it's the single largest market anywhere in the world. We have covered around 3.6 lakh villages so far, and should be able to cross the five lakh villages mark very soon. IT will play an instrumental role in addressing this market through innovative solutions and products. We are working with handset makers and other partners to ensure that we serve this segment well. We would like to be the most admired brand in rural India as well.

As CEO, what is your involvement in making IT decisions and driving IT initiatives at Airtel?

It is very important for me as the CEO to get involved with IT, especially in big investment decisions. I also need to back new IT initiatives, because a top-down approach helps make the best use of any new deployment. This is also because other functions might not be able to appreciate IT as much as is required, and therefore, I need to make them understand the valueof technology. I have to act as a catalyst between IT and other businesses to ensure that both are tightly integrated.

What are some of the business challenges you face, and how can IT help in addressing them?

Balancing long-term and short-term business goals is one of the key challenges CEOs face, apart from several operational issues, as we continue to add over 2.7 million customers every month. We need to take tomorrow's decisions today, and this is where IT helps by providing almost on-demand information and data.

Managing the supply chain also poses several challenges, however there are several innovative solutions we've placed in our supply chain to help us foresee and address potential problems.

In your opinion, what are the attributes of bold leadership, and how can CIOs become strategic leaders?

Leadership involves putting together basic characteristics and core values of an organization or a team. Building this character across a team or a company is one of the important attributes. Boldness also requires developing a vision for the business - both long-term and short term, and then making decisions in line with that vision. Some of these decisions might not be popular, but could take the company a long way in evolving as a successful enterprise. Another area, where even CIOs can develop their skills as strategic leaders, is sensitivity towards employees, customers and partners. Leaders should be able to smell market needs and opportunities before anybody else does.

What’s your advice to CIOs?In your opinion, what are the attributes of bold leadership, and how can CIOs become strategic leaders?

As reflected in our case, CIOs must have a long-term architecture in mind even as they address short-term business priorities. My message for CIOs is to empathize with their businesses apart from keeping in mind the needs of the final customers. In fact, CIOs need to be a lot more customercentric and even help business address the unarticulated needs of its customers. This is how IT can help business innovate and launch new products. CIOs need to think of technology in the context of business. They need to keep figuring out areas where business has challenges and address them with appropriate technology solution.