On November 4 2021, Kyndryl completed its separation from IBM, listing on the NYSE under the ticker: KD. It started life as a new independent company as one of the world’s largest start-ups: $19 billion in revenue, an approximately 88,000+ strong team, working with 75 of the Fortune 100 including some of the largest brands in India. Express Computer in an interview with Lingraju Sawkar, President, Kyndryl India deep dived into the spin-off of its managed infrastructure services and talked about the first 100 days of managed services business as a separate entity in India. Read the full interview here..
Express Computer: IBM had announced the spin-off of its managed infrastructure services business in 2020. What are the key learnings and opportunities you see going forward? What has been the restructuring in terms of customers and employees since Kyndryl was formed?
Lingraju Sawkar:After listing independently on NYSE last November, we are on a mission to build the very best technology services company in the industry. Our independence gives us the freedom of action to pursue improved growth and margin expansion, with greater ability to partner, invest, and capture new opportunities.
We started our journey as a US $19 billion startup participating in a growing market projected to grow to $510B in 2024. Our strength is in our operating model and the go-to-market focus and alignment to our customers’ needs. We operate in 63 countries with a global team, state-of-the-art delivery operations, and the opportunity to forge alliances with leading technology players.
Kyndryl runs the ‘heart and lungs’ of thousands of customers – designing, building, and modernizing their technology systems so that they can stay competitive in an increasingly digital global economy. We play a pivotal role in enabling a digitized future where companies need a trusted IT services partner to bring the best talent and technologies to address their business challenges. Our strategy for long-term growth focuses on 3As: alliances, advanced delivery, and accounts.
When we talk about alliances, it is about the ecosystem partnerships that we have signed with key hyperscalers and industry leaders. This expands our capabilities to serve our customers using the best variety of technologies available from our partners — whether it’s Microsoft, Amazon, Google, or any others. Advanced Delivery focuses on leveraging the power of automation and looking at innovative ways to improve efficiencies and transform delivery. We already have over 900 practitioners from across the world freed up for redeployment and upskilling for higher-value services.
And finally, we are reviewing our client accounts to ensure we’re positioned for success from the contract terms and profitability point of view.
Express Computer: Kyndryl India has a sizable talent force in India. From a talent attraction and retention perspective, what is your plan?
Lingraju Sawkar: India is a massive talent base for Kyndryl. It is one of the core 10 countries in our global footprint of 63 countries. A vast majority of our talent is based in Customer Innovation Centres in India working with more than 700 customers worldwide.
Reskilling and upskilling of our employee talent are key aspects of our alliances with public cloud partners like Microsoft, Google, and AWS. This is also an attractive aspect for external talent as they can gain skills and cloud certifications across these hyperscaler cloud providers, as Kyndryl employees.
We are proud of our investments in our people. We recently announced our inaugural class of Distinguished Technical Leaders, who are among the best and brightest technologists, industry leaders, and innovators in the world. This peer group of PHDs, Distinguished Engineers, data scientists, researchers, and the diverse industry segments – telecom, banking, manufacturing, auto, retail, etc – that Kyndryl works with, are a great opportunity for learning and career building for our employees.
We were also recently recognized as an ‘Employer of Choice for Women’ for our efforts to build a better workplace for women in technology.
Our culture – the Kyndryl Way – underpins everything we do as a company. It is based on three values – being restless to continuously learn and innovate, being empathetic, and being devoted to shared success. We now organize and act as a company that is flatter, faster, and focused. We have significantly reduced layers of management and become faster by reducing process and decision-making time. This focused approach helps our teams to deliver high-standard solutions for our customers and solve their toughest technology challenges.
Express Computer: As a new entity, Kyndryl is broadening the ecosystem of strategic partners and a wider range of technologies. Your views.
Lingraju Sawkar: As an independent company, one of our priorities was to establish partnerships with the top hyperscalers — and we’ve done that. Within our first 100 days, we signed agreements with Microsoft, Google, and AWS, as well as with VMWare, Nokia, Dell and more.
Enterprises need a partner with the freedom and ability to design, implement, and manage the best technology strategy to match their own long-term goals. Kyndryl recognizes the strengths and capabilities of different players and collaborating with them helps us deliver cutting edge solutions in high-growth areas where customers are demanding innovation.
The Microsoft partnership involves a new co-innovation lab to build and deploy cloud solutions and with AWS we are developing an accelerator for VMWare Cloud on AWS.
We are upskilling our talent base through the Kyndryl University for Microsoft, AWS Cloud Center of Excellence, and SAP certifications programs building capabilities in global cloud and infrastructure operations. Our global network and edge computing alliance with Nokia provides industrial-grade reliable and secure LTE and 5G private wireless networking for enterprise customers. With Dell Technologies, we provide Cyber Incident Recovery to accelerate cyber resilience, innovation, and business reinvention for customers. The partnership with Red Hat will offer integrated services and solutions based on Red Hat Ansible Automation Platform to advance IT automation for multicloud infrastructure for customers.
Express Computer: Kyndryl India is partnering with other hyper scalers, be it Microsoft or Google. How are you leveraging the new partnerships and existing partnership with IBM?
Lingraju Sawkar:We are now two independent and distinct entities, and we will engage with IBM as we do with our other partners. Kyndryl will continue to include IBM hardware and software among its offerings, based on the client engagement and requirements. We share many customers in common, and we’re committed to their success.
The separation however gives Kyndryl more opportunities and freedom of action to do what we do best: deliver independent advisory, implementation, and managed services at scale across multiple technology infrastructures. We believe this presents an opportunity to unlock a total addressable market of $510 billion by 2024.
Express Computer: What are your views on India’s growing IT infrastructure/Managed services business in India? How Kyndryl is disrupting this space for its customers?
Lingraju Sawkar:According to McKinsey, India’s IT industry is expected to grow by about 70% within the next five years, climbing to a total annual revenue that’s somewhere between $300-$350 billion. Kyndryl India is the market leader in IT infrastructure services with an 18% market share.
Our balance sheet is strong, and we continue to invest in our business. We are differentiated by our offerings and partnerships and are already well established in the Indian market. In fact, every second phone call, every second banking transaction, and every second bank account in India is powered by Kyndryl.
We have a global scale with state-of-the-art delivery operations; we are now the number one Hybrid Cloud Managed Services company with market leading size and scale – at twice the size of our nearest competitor. We provide 2 million terabytes of storage, manage 750,000 virtual servers and 270,000 network devices. We also manage over 25,000 SAP and Oracle systems.
Our work in India ties in directly with our national imperatives. The current ‘Digital First’ approach of Indian enterprises works in tandem with the ‘Digital India’ policy, extending access to the economy to every person in the country. Kyndryl enables our customers to tap into the best talent available and engage their customers and potential employees in the ways they want to be engaged.
An example is our engagement with Bangalore International Airport, with whom we created a new “Airport in a Box” platform to transform the end-to-end travel experience for passengers. The platform enables BIAL to improve employee productivity, better utilization of IT assets, reduce costs through streamlined inventory control and improve incident management. Suryoday Bank, a small finance bank in India, announced that they will leverage our expertise to drive its technology transformation program, improve operational efficiency, and increase digital banking adoption among its customers as part of a five-year transformation partnership.
Express Computer: What are some of the key challenges that lie ahead and what are your key priorities to stabilize the organization from a customer perspective and deliver results?
Lingraju Sawkar:A key priority is to get back on the growth track and we are well on our way with the strategic approach of ecosystem partnerships, talent re-skilling and upskilling and leveraging our global scale to deliver best-in-class solutions for our customers.
The infrastructure services space is not generally considered an investable area as compared to cloud, data, security etc. Hence, customers needed to be convinced that we have the potential to participate and guide them on their relevant journeys. We took this as an opportunity to build an engagement model that meets customers wherever they are on their digital transformation journey.
Our single integrated customer engagement model focuses on the six global practices of Cloud; Core Enterprise & zCloud; Digital Workplace; Applications, Data & AI; Security & Resiliency; and Network & Edge. These global practices will design and deploy offerings, set standards, and ensure they integrate with the other services we offer. They will develop solutions and advanced delivery capabilities to deliver them through a highly upskilled community of Kyndryl practitioners. The services offered are also aligned across advisory and implementation services to ensure consistency in our go-to-market approach to customers.
Our customers see us as the trusted partner for running their mission-critical systems and the fact that over 4000 customers have retained us post the spin-off is a testimony to this. And we attract new customers because we have the freedom of action to work with any partner they need to solve the most critical technology challenges they face.