The top HCL companies are all in the applications end. Apart from its training business, NIIT does a lot of work in educational software. HCL Technologies does technical and implementation software. HCL Infosystems does other types. There are overlaps, but other than that the companies remain independent and different. "Within the group, we compete with each other regularly. Even within HCL Insys, some divisions compete. We believe that when you compete like this, the market is covered better," says Chowdhry. "When we look at the trillion-dollar business that is international, we are hardly trying to grab a very big slice of the pie. Things sure have changed."

Altogether 17% of revenues come from domestic services, and the target is to grow this to 35-40%. While hardware is not growing, it still remains a critical part of the business strategy. "We are quite upset that we are lower than Compaq this year by a small fraction, albeit a very, very small fraction. We are concentrating on increasing our market reach dramatically. It is terribly competitive out there and the only way to do this is by grabbing someone else’s lunch," says Chowdhry. Evidently, and much as business should, HCL is out to do so, and it is very hungry.

But there are no software-only names in the group. Asked if this scenario will change, Chowdhry admits that it is time that it did. "We see domestic software as a very nice strategy to learn. We created a SAP wing to create a SAP chapter in India. We wanted to grow this. The first project that we did here was for General Motors. We also carried out an information systems plan for them, and told them how to start IT operations in India. That is how we internationalized our SAP. We did the same for Samsung. We have continued to do SAP projects in India. We have some very process-oriented customers here," says Chowdhry.

Ask about IT-enabled services and pat comes the reply—"That was the reason we set up HCL Infinet as a separate company. We have 100,000 Internet subscribers, and 100-odd corporates complete the picture. A small software technology park has been set up for IT-enabled services. Our first 25-30 tech help desks (for Microsoft) have been set up for IT-enabled services in Delhi, call centers and the like. The overall strategy is to integrate all these operations—help desk, call center etc—since the technology required is nearly identical. Dial-up is only used as a good way to reach our customers, otherwise it doesn’t really bring in any returns… the cost of sales is really low, and dial-up has helped here. The corporate market is where the money will really come in from. We understand IT and applications. You can’t just sell connectivity. You need to provide hybrid solutions to your customers."

So where’s the growth coming from—40% of it is expected in the services segment over the next three years. And the revenue mix—40% from domestic and exports services, 30% from products and system integration, and 30% from exports, mostly software. A lot of the services are around the hardware segment, and the company is doing a lot of SME implementation as well. —RN