MBT: Your Partner in Successful Change Vision 2008 MBT Shadow Board

Agenda MBT  Shadow board objectives  Shadow board plan  Vision development  v ision 2008  8 point vision charter

Milton Keynes London Ipswich Bletchley Düsseldorf Operations began in 1988 Entirely focused on providing software services to the Telecom industry worldwide. A Joint Venture between Mahindra & Mahindra (57%) & British Telecom (43%). >4500 professionals in USA, Europe, Middle East, India, Asia- PAC, rising to >5000 during CMM Level 5, ISO9001:2000, ISO17799 Consolidated revenues of over $129 million in 2002/3: ~$160m in 2003/4. Company: MBT at a glance (Nasscom, 2003) #1 telecom software solution provider from India # 7 software exporter in India Employee Strength

Shadow Board Objectives  To provide a “Vision to Implementation Strategy” for MBT for the next three years  Undertake two internal initiatives which can contribute to MBT fiscal performance in 04-05

Shadow Board Plan InitiationVision & Issues Development Solution Development Implementation Strategy Formulation Organizational Sign off Milestone Sept Milestone 23 Nov 04 Milestone 15 Dec 04 Milestone 10 Jan05 Milestone 15 Jan 05 SB Scope and Objectives SB Plan SB Think like Board Training MBT Vision cornerstones supporting the Vision Top 5 objectives underlying each vision cornerstone MBT SWOT Competitor Analysis Customer Analysis Key Issues Game plan for Implementation of the identified objectives within MBT Senior Mgt buy in

Vision Development  Outline our view of where MBT should be in FY  Develop an easy to understand 8 point charter for MBT to institutionalize  Develop an integrated set of objectives to achieve the Vision  Use extensive analysis and discussions to complete the task

Vision: “To rapidly grow through business excellence by delivering quality services and solutions to the customers we serve ” 2,500 crores & 12,000 employees FY Target 900 crores & 5,000 employees FY Demand exists – Indian software exports will account for about 7% of the global market by 2009 Offshoring can reduce costs by 35% Tier I Companies, Infosys and Wipro CAGR of 44% Global competitiveness and industry attractiveness for new players will decline by 2012 Unless a company is of suitable size, acquires scale in the verticals it chooses to compete in and has the ability to differentiate itself, its sustaining ability will be diminished by 2009

8 Cornerstones to MBT’s Vision 2008  Drive business growth by being the right partner to our principal customers across their Industry value chain  Derive 30% of our revenue from premium services  Grow inorganically and diversify into new services and verticals  Global expansion with synchronized delivery  Maximize organizational efficiencies  Powered by oneness, driven by change, measured by results, rewarded for excellence  Drive innovation through intrapreneurship  Be a preferred Indian employer of IT Talent”

Drive business growth by being the Right Partner to our Principal customers across their value chain ”  Support our principal customer to acquire revenue  Support our customer to reduce costs  Support our customers to deliver cost effective solutions  Support our customers by working with their principal supplier to speed up the internal rollout of new solutions  Support customer in as many ways as possible – SI services, Consulting, Software Services, BPO  Be part of their business plans  Have at least five principal customers in each vertical we operate. Each principal customer should contribute over 25 million in revenue by 2008 Forge longer, deeper and closely aligned relationships with principal customers and have a joint go to market strategy

Derive >30% of Revenue by Delivering “Premium” Services  Most Indian companies are driving development of premium services such as SI, product development or consulting services for global markets.  e.g CRM System Integration, domain consulting  Top Tier companies are investing in these services as a way to grow margins and revenue  Commodity $, Value per hour offshore  Industry talent will be available, but at a higher value by For now, companies need to train talent or acquire companies with talent The “door opener” for commodity services Premium services will drive up revenue, profitability and be the entry point for commodity services like Process Outsourcing

Be able to grow inorganically and diversify into new services and verticals  Grow by the experience of others, rather than doing it ourselves. Particularly in the shift to other verticals or related ITES areas like BPO  Acquire customers and established business in value added areas  Similar business models it’s a me too world  Rapidly gain ground over established players  Overcome MBT’s weakness in customer acquisition and market expansion Enable us to grow quickly into higher value services and provide services across the principal customers value chain to be “true partners”

Global Expansion with Synchronized Delivery  Go global and establish our business presence in key geographies  Ensure that at least 50% of our revenue comes from US by 2008  Ensure that the management style is similar across geographies  Delivery and compensation should be as per the geography  Understand customers and give customers an understanding about ourselves Offshore Delivery is Key. Expand globally, but root the expansion in a management culture that supports the advantages of offshore, reinforces and builds on them

Maximize Organizational Efficiencies  Financial Returns Through Operational Efficiencies  Sales Efficiencies and Consultative capabilities  Improve the profitability of the business mix  Improve the profitability based on onsite and offsite ratios  Manage premium segment of the business differently from volume segments  Maximize utilization and continue to push the envelope  Drive cost efficiencies through all aspects of the organization  Create success metrics for non- billable activities and ensure strict follow-through In addition to maximizing revenue, maximizing profitable revenue is a key objective. This implies focus on high margin business areas and cutting costs out of existing and new business

Powered by Oneness, driven by change, measured by results, rewarded for excellence  Create a culture that allows some of the countries top talent to be challenged  Team over individuals, new business processes and matrix structures  Integrated set of business practices, to achieve organizational excellence and cost optimization.  Defined accountability  Unlimited rewards share the profits on a per engagement basis The culture drives the ability of talent to adapt to the fast paced changes in the IT Industry, bring business excellence, innovation and change in our business mix

Drive innovation through intrapreneurship  Create a culture that allows some of the countries top talent to be challenged  Team over individuals, new business processes and matrix structures  Integrated set of business practices, to achieve organizational excellence and cost optimization.  Fit the role to the person at senior level  Defined accountability  Unlimited rewards share the profits on a per engagement basis Enables and organization to quickly acquire and develop ideas closely aligned to the main business or spin off ideas which can be offered to other verticals

Be The Preferred Indian Employer of IT Talent  Talent supply gap is around 25%, going to by 2009  Attraction and Retention are key as more multi-nationals enter the market  A large part of the talent will become less mobile and remuneration may plateau for some jobs  As the business mix changes from Time & Material to fixed Price employee productivity will drive profitability  Wealth creation for employees through Employee Stock Option Program  Drive mandatory training for all employees to drive skill sets up the value chain organically Attracting and retaining talent is the main driver for scale, cost reduction and conservation of organizational and customer knowledge

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