How Sify Technologies transformed itself into a new age ICT services provider

The year 2012 will be remembered as a watershed year in the transformation journey of Sify Technologies. This was the time when the IT services industry was taking a turn from the erstwhile on-premise Systems Integration model of delivery to embracing cloud-based models in multiple formats. Until then, Sify Technologies, which started as the first Private Internet Services Provider in India, had undergone one round of transformation to an enterprise network and data center services provider.

Sify Technologies recognized the emergence of the cloud model and the impending digital transformation. The company set up its most significant transformation journey from an enterprise network and data centre services provider to an integrated ICT solutions and services provider.

And, the person mandated with driving that change was veteran digital transformation evangelist Kamal Nath from HCL Technologies. During his 17 years stay at HCL Technologies, Nath has

front-ended various transformational engagements with large enterprises, incubated new business services, created innovative business models, and spearheaded new and high-growth vertical customer segments.

In the last five years, Sify has consistently grown in revenue and profitability under Nath’s leadership while transforming Sify into the most relevant ICT solutions and services partner for enterprises, public sector units and Government organizations.

Ushering in the cloud era

Sify has been bullish about the growth of cloud and managed hosted model in India. “From 2012 onwards, we re-oriented our business strategies, incubated new business lines, invested in cloud data center infrastructure and services, created SMAC Net(work) platform for the cloud era, incubated business outcome based ICT services model, augmented our applications portfolio and adopted a vertical go-to-market strategy. This has not only resulted in consistent and predictable quarterly growth in revenue and profitability but also has built a strong foundation of our future growth,” elaborates Nath.

Nath believes that the new age cloud providers are in a better position to be the partner of choice in the cloud and digital age as against the traditional IT services players whose model is predominantly based on “more hardware, more people and more licenses.”

Breaking new grounds

Over the years, Sify’s products and services have been endorsed on multiple fronts. The company’s capability to deliver multiple large format projects has validated its unique proposition in the market. Talking about the new opportunities, Nath says, “The new era of Hybrid IT model is helping us to deliver new and differentiated services. By embracing the flexibilities of Hybrid IT model, customers can choose the right mix of public or private cloud and managed hosted solutions, while deploying workloads on platforms they are best suited to be run on.”

Today, Sify has cemented its positioning in the market as a new age ICT partner for its clients. The company feels the emergence of the Third Platform based on SMAC (social media, mobility, analytics, and cloud) has triggered a much wider acceptance of productized (or commoditized) services business vis-a-vis a systems integration model. The core focus of the company centers around the data center, cloud and network designed for the cloud. The company’s emerging applications and platform business also centers around the cloud model. “We help customers to move their applications workload from an on-premise model to multiple formats of cloud platforms based on relative merit. The cloud model enables customers with a flexible and agile platform supporting their digital transformation journey.”

Sify is very optimistic about the potential of the Indian market and has invested significantly in data centers, cloud, and network infrastructure. These investments were in line with the company’s thinking of build-before-they-come. Going forward, these investments will continue with made-to-order data centers and networks.

Winning customer trust

Sify currently generates over 95 per cent revenues from customers in India. As the company transformed into an Integrated ICT solutions and services provider, the initial opportunities were to expand its portfolio with the existing 8500+ enterprise customers who were mostly subscribed to network and hosting services. Hence, the major task for Sify was to engage with these customers for cloud services, managed services, security services, and application services. In parallel, Sify has also signed up significant number of digitally born companies in their customer list. “Our aim is to be the partner-of-choice for our customer’s data centre and network transformation journey while they adopt digital models,” opines Nath.

Going beyond co-location services

Sify claims to be the only service provider that offers both cloud and on-premise services directly to the customers. For Sify, the data center business is promising, although it’s a difficult business to be in, as the initial Capex is high. Both the global companies and Indian enterprises demand global standard data centers for running their IT.

Talking about the trends in data centers, Nath explains, “In this business, if you only sell co-location as a service, there is no leverage with the customer. What is crucial for any data center player is to go beyond co-location and maximize the services revenue from the customers who have hosted at the data centers. And, that is why the thrust is on building a versatile eco-system of managed services around our data centers.”

Minimum Capex, Opex and maximum RoI

Sify’s business model is based on the theme of “less hardware, less licenses, and less people”. The company encourages customers to go for a subscription or business-outcome based model vis-a-vis a “Build” model. The right mix of public cloud, private cloud, and on-premises solutions, allow customers to run their business more effectively. The new business-outcome based approach has helped Sify to attract more customers in verticals like BFSI, Energy and Utilities, Manufacturing, Education and Healthcare. “We are winning deals against the Indian and MNC IT giants as the customers have recognized our integrated approach being more relevant than the traditional IT Services companies,” says Nath.

Vertical go-to-market strategy

In the beginning of FY 17-18, Sify announced a vertical go-to-market strategy across all its business segments. This mix of vertical strategy and its unique positioning as an ICT services provider and integration partner for its clients, has resulted in sustained growth in order book, revenue, and profitability. Nath believes that its business-outcome oriented usage models for key verticals, complimented with its services capabilities, will be a significant differentiator in its growth journey going forward. For Sify, BFSI, Manufacturing, Healthcare, Education, IT/ITeS, Media & Entertainment, Government, and PSUs are the major focus verticals. Nearly 20% of its business comes from the government.

Moving forward

The company feels that there is a lot of untapped potential in the Indian market for their digital business model. The undeniable signs are the pace of cloud adoption by enterprises and automation thrust by the Government of India which have moved into high gear. Time and the recurring results have proved that Sify’s transformational journey is on the right path. As the new business touches the maturity cycle, the company is all set to scale up the business with new services and making more investments around applications, security, and IoT.