Growing information technology companies in India should look for listing on the Nasdaq rather than opting for a domestic listing, Lakshmi Narayanan, chief operating officer of Cognizant Technology Solutions, said on Friday.
"Also, keep operating margins between 18 and 20 per cent and re-invest 20 per cent back in the business," Narayanan said while delivering a lecture at the Indian Institute of Management, Ahmedabad, as part of Confluence-2003, the annual business school meet.
Over 300 students from various business schools attended the lecture. He said there are four stages of development in a typical IT company's growth chart.
The first is on-site development and staff augmentation, followed by offshore production, then a phase where both on-site and offshore productions continue simultaneously and the last stage is of consolidation, where partnerships play a very important role, he said.
Narayanan said multi-cultural recruiting is essential for becoming a global market leader.
No company in India has enough expertise to develop solutions for any one vertical portal, but the industry still makes products of global standards, he said.
Instead, budding entrepreneurs, who want to start an IT company, must go in for the horizontal model, providing IT solutions to a range of portals, while concentrating on quality work, he said.
Narayanan said customer centricity is the key to sustained competitive advantage.
On the strategies that his company has adopted over the past decade, Narayanan said beginning with a joint venture, Cognizant has adopted the partnership model as in the case of Variant Transition for e-business.
Then, with companies such as iNautix, Cognizant adopted the BOT model while it opted for the acquisition strategy in the case of United Heath, Amex and Aces, he said.
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