HCL TECHNOLOGIES:

EMPLOYEE FIRST, CUSTOMER SECOND

Submitted by Group 10
Akkudalai Priyanka - PGP11140
D Lakshmi Jaya Harika - PGP11148
Devika A S - PGP11150
Komal - PGP11155
Rastra Kunwar Maurya - PGP11173
Swati Sucharita - PGP11191
 Introduction
● In 2005, Vineet Nayar was appointed as new CEO to HCL Technologies
● He had a challenge of bringing the company to a leadership position in IT sector
● At that time, HCL faced with high attrition rate and demoralized workforce
● In 2006, he introduced new strategy “ Employee First, Customer Second,” (EFCS)
● EHCS strategic goals were: create a unique employee organization, drive an inverted
organizational structure, create transparency and accountability, and encourage a value-
driven culture
● After three years of implementation of EHCS it was observed an increase in employee
engagement, customer satisfaction, financial performance and innovation
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Indian IT Services Industry
● Indian IT Services sector is a demand driven industry
● The rate at which the companies could scale up their output determined their market share
● Scaling was directly related to the employee headcount, making hiring and managing attrition rates
very important in this sector
● Constant increase in demand and complexity required to hire more employees
● Productivity of new hires was a challenge, training new employees became a necessity and
companies had to incur more costs on training new employees
● Indian IT companies face the challenge of developing and retaining employees who can cater to
client needs effectively

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 Transformation at HCL Technologies
The transformation was to occur in three phases -

1. It was to create more engaged employees through EFCS (Employee First, Customer
Second)
2. Vineet wanted to form strategic partnerships with other companies to offer more value and
end-to-end services to the customer
3. It was to implement a radical shift in HCL’s core business model, with 50% of revenues in
2010 coming from services that did not exist in 2005
360- Degree
Smart Service Desk Opinion polls Directions
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U&I Initiative CEO’s Blog Natasha

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Major Innovations
● New ideas to support new strategic focus on value
1. Concept to Manufacture or C2M
● Offered benefit of intellectual property ownership to customer
● Minimize development and program management effort
● First to offer in global delivery model, with services offered from remote locations
1. Global risk-reward partnerships
● Assumed research and development, product engineering, and customer-support activities
● Customer firm owned the brand and the sales and marketing responsibilities in a revenue
sharing arrangement
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 Contd..

● Allowed each organization to focus on its best competencies, fostering resource focus and
goal alignment with shared objectives

3. Integrated services in the enterprise IT space

● Synergies from having common help desks, common tools, and common operations
centers could be realized
● Managing multiple customer touch points in a coordinated fashion
● Enabled to streamline the customer’s processes and remove redundancies, resulting in
lower cost, higher reliability, and enhanced service

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Issues in Implementation

● Internalization was one of the issues where employees were unlikely to adopt that lacked
transparency
● Resonating Corporate values with employees’ own system of values which otherwise
would be difficult with large group of employees
● HR policies of HCL were not unique even within IT Sector
● Complex customer landscape consisting of wide range of technologies
● Strong service brand to give an edge to the competition which aids customer value focus

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Gathering Evidence
● The case study team planned to investigate a long list of questions so as to understand how
HCL changed from 2005 to 2008
● Used a two step approach they started with face to face interview with different
stakeholders to conducting a survey on 1000 randomly chosen employees
● To gain employee perspective the team interviewed 100 employees with diverse
background
● Second phase was to gather all the viewpoints using a questionnaire
● For understanding customer perspective the team members utilized customer satisfaction
scores
● In case of shareholder perspective team members questioned 2 investors and 3 analysts 8
Future Steps
● Bottom up method for the change in the culture should be followed
● Changing the mindset of employees by introducing mandatory programmes to disrupt
hierarchical command control
● Comprehensive training of employees in the integrated approach
● Build strong service brand by relationship of employees with the customers
● Rapid hiring should be promoted as scale up was the direct multiple of employee
headcount
● Search for new business opportunities and solutions to increase contribution of IT vendors

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