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Software/IT Services/Business Process Outsourcing
According to Yogesh Vaidya, one of HCL Technologies’ founders
and HCL America’s first CEO, the company’s first U.S. systems
integration and consulting client was Sybase, and most of their
engineers were HCL contract employees. Next came HP, and
other tech firms with Unix systems followed. At the time, Vaidya
was managing 200 engineers in the Bay Area.
In 1991, HCL formed a joint venture company, HCL HP, with international
computer giant Hewlett-Packard (HP) and made a technological
leap by developing manufacturing expertise in India for
HP’s RISC/UNIX based business servers and workstations. HCL
HP Ltd. gave HP an India sales channel for its products, outsourced
a share of HP’s R&D to HCL in Noida, and developed joint
business solutions.
When the joint venture with HP ended in 1996, HCL Technologies
was formed by merging an HCL Consulting unit with the R&D division
of HCL HP Ltd. Consolidation continued, reducing HCL’s 40
subsidiaries to 5 by 1998. Going into the Y2K period, the company
remained heavily weighted toward hardware and product engineering
R&D, while other Indian firms were moving increasingly
into enterprise software and IT solutions.
HCL tried to catch up in IT services through further streamlining—
including the sale of its share in a joint venture with Perot Systems
and the acquisitions of British Telecom and Deutsche Bank captive
centers. Five divisions became two: HCL Technologies (global IT
services) and HCL Infosystems (hardware and network solutions
for the India and Asia-Pacific markets).
The Next Level
But the most dramatic restructuring within HCL came in 2005 under
a new president, Vineet Nayar, and became the subject of case
studies by Harvard Business School (2006) and the University of
Virginia’s Darden School of Business (2008).
Nayar, an MBA graduate of Xavier Labour Relations Institute,
Jamshedpur, joined HCL in 1985 as a senior management trainee.
In 1992, he formed an IT infrastructure and networking business
unit, HCL Comnet, to bid on a government project to create an
electronic stock exchange; HCL won the bid and the exchange
was up and running by 1994. Nayer grew HCL Comnet to 1,000
employees, with contracts in 11 countries, and HCL Comnet was
eventually folded into HCL Technologies.
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