Quatrro Creating Value Through Innovation : Raman Roy

Interview Questions

Full Interview with Raman Roy

Raman Roy:

Being an entrepreneur is not about starting a business and making money from it. It’s about an attitude. Being an entrepreneur begins with belief in yourself. It’s about having an inner drive, about wanting to prove a point. Take for example how many years ago, I had a disagreement with my bosses and I grit my teeth and said “I’ll prove to you that this can be done out of India” (That effort culminated in American Express’ captive BPO in India, among the first, of its kind).

Being an entrepreneur stems from a desire to create something unique and different — the events that help identify that can be very different. But once you have that and the belief, finding a path to the unknown and the solutions — that’s what is incredibly exciting. It isn’t just one challenge. I wish it were then I could have said that I knew how to tackle it. As you attempt different things, trying to actualize your belief, you realize that the challenges are linked to what you are trying to prove and what you are trying to actualize.

That’s why ‘creating value through innovation’ is at the core of Quatrro’s philosophy. If it is something worthwhile, if we believe it has intrinsic value — we want to participate in creating that value. We don’t do business for social service or money, we do it because we want to prove a point to ourselves and to the world. It’s our belief that if the point we want to prove is relevant then it will have value and it will generate money in the process. This is our fourth venture if you look at the past three; you’ll find that even in the depressed market scenarios, their market value is well in excess of $5 billion (about Rs 27,500 crore). In this journey, one of my big learnings is it isn’t the end that matters. The journey to the goal is equally exciting. You must not only enjoy the fruits, but the journey too.

Raman Roy:

During my days at American Express (1984-96), there were doubting Thomases who did not believe that India could be a location for outsourcing, who thought we could not do something international out of India because the country did not have the robust technological infrastructure or the intellectual capital needed to deliver work of international standard.

Then at GE, people had only heard of India as an IT hub — not as a location to establish global call centers. We had to prove that India could be a location by proving that it could handle scalability. Till then, the thinking was that you can get 500 to 700 people but not 3,000. In the next five years, we grew it to about 9,000 people.

But, at the end of the day, American Express and GE were captives. I had an entrepreneurial aspiration to run a true profit center. So, in March 2000, I started Spectramind. The third-party challenge is what we took on at Spectramind. Until then everybody believed that India was only a location for captives. Despite what Amex and GE had proved, doubts prevailed. But we were right about the potential because in less than five years, we became the largest BPO provider in the country, with 16,500 people. We went go on to prove how fertile the ground was for the right kind of services.

Raman Roy:

Every time I have taken on a new entrepreneurial venture, the challenges have been numerous and diverse. Each of the companies I set up evolved at a different stage of the evolutionary cycle of the BPO industry. In my fourth venture, Quatrro, I wanted to show that different types of models and capabilities were possible. The challenge this time is to show that sophistication is possible. The challenge at Quatrro is doing things that haven’t been done before — work that is based on knowledge and competency. We do mortgage foreclosures, which is an unknown, nascent and very high-end activity. Quatrro is a next-generation sourcing provider. We’re among the few that offer risk management services. We provide legal solutions and we’re also into interactive gaming.

Raman Roy:

It is our belief that outsourcing and offshoring will become an integral part of the solution. We are convinced that countries like India will be a part of the solution. Therefore, for the entire industry, this is going to be a big boon. But that boon will only show after the bottom has been hit, which unfortunately is still sometime away.

The BFSI segment will grow four to five times in the next three years. It is a great opportunity for the industry. Right now, there is turmoil and decision-making has frozen. What will happen in the near-term and what will happen in the medium-term are vastly different. In the near-term, there will be more challenges: a lack of decision-making and total inertia, which in the medium-term will lead to newer needs from customers. In my opinion, the downstream in the medium-term will convert into very significant revenue opportunities.

Raman Roy:

We constantly seek new ways of outpacing competition by playing with new rules. We act on the basis of a combination of lateral and vertical thinking. We have always challenged assumptions, generated alternatives, spurred change and found new entry points from which to move forward. And in doing all of this we have led to a change in perception.

In any venture, there is only one person that matters: the customer. Everything else is a consequence. If you can identify an unmet customer need, and are able to propose a way to fulfill that need in a manner that’s more productive — it could be better quality, better price, better timing, or better time-to-market — you have cracked the secret of engaging your customer. This is what I call readiness to serve.
We kept changing our model to be able to serve our customers better. Success lies in identifying what is more productive for the customer. If the customer wants value for his money and you can create that value for him in way that it creates profitability for yourself — that’s a recipe for profitability. This is competition at its purest because you are striving to meet a customer’s aspirations. This is central to a winning strategy.

Raman Roy:

The value we deliver provides us competitive distinctness in an increasingly
cluttered market space. We bring specialized service in whatever we do. We aspire to create value that can act as a catalytic activity to start a reaction. We are looking to create something that adds value and makes path-breaking progress. We want to create something that we can look back at and feel proud and fulfilled about. We want to prove a point to the world.

Raman Roy:

Pioneering is perhaps a better term than pioneered because this is a long process. The initiative was propelled by our realization that there is a huge amount of latent talent sitting at home. Whether it’s the educated housewife or the educated in non-metros, we saw a vast, untapped talent pool that was not part of the mainstream.
When we pioneered the concept six years ago, our path was strewn with multiple challenges. We worked with the government to overcome regulatory hurdles. Today, Quatrro is the only company licensed to test home agents. There are technological hurdles like the availability of broadband connectivity and robust infrastructure. We are working with HR to surmount training hurdles and resolve supervisory and talent management issues.

Monitoring the quality of work and training home agents is an enormous challenge. We are also working with finance companies to get PCs for all our home agents. There are a lot of aspects that we are trying to architect but the concept has been immensely beneficial. The initiative has the potential to unleash the latent intellectual capital in non-metros.

It has also helped us prune operational costs while enhancing the availability of trained manpower. It has not only optimized costs, but also bridged the metro-non-metro divide. We can leverage this to overcome a spiraling attrition rate that is characteristic of this industry. I think it’s a game changer for the outsourcing sector.

Raman Roy:

We will see consolidation and on the flip side, we will also see niche players emerge, which don’t necessarily have scale but bring competency and capability at a high end. It is not an ‘either-or’ scenario — both will happen. You will see niche players, specialization, scale, dramatic growth, and you will see different business models. In some segments, you will see increasing customer participation and in others less.

Raman Roy:

Inorganic growth is a chief component of our strategy. We have made seven acquisitions in three years. In order to realize the benefits of this strategy, post-acquisition challenges need to be addressed effectively. Often, integration challenges are a result of a lack of clear, concise, transparent, honest, and timely communication. Poor internal communication can undermine all post-acquisition integration efforts. Communication is the glue that holds everything together. It encourages trust.

Articulating a strategic vision and growth targets is a prerequisite if you want to foster clarity. When we articulate a situation well, many apprehensions are dissipated. This facilitates effective post-merger integration and helps a company execute its aims. It is essential to be a patient listener. Acknowledging, assimilating, and attending to what the acquired entity says, is very important because this inspires trust in them. This has been one of our learnings.

Raman Roy:

IT is the lifeblood of our company. Since our offerings are technology-dependent, it is important for us to develop robust technology infrastructure. Speeding up IT competence is the key to enhancing our competitiveness. Hence, we make sure that our internal IT team sits on the panels that devise new products and service offerings. The executive council does not develop new product and service offerings in isolation and then put it on the lap of IT to find solutions. IT is an equal collaborator in product design and development; it is an equal partner in selling to the customer as a part of the sales process. IT is a significantly higher partner in delivery. They play a predominant role in our success.

Raman Roy:

Sunil Gujral, who heads the technology initiative at Quatrro, is a part of management, from product innovation, to new product identification and customer acquisition. It’s a large, holistic thing — giving a CIO membership to the executive council does not resolve everything. Like every other member of the team, it is important that Sunil Gujral understands what our end game is, what our goals and our priorities are and is able to bring his capabilities to bear.