Date:01/06/2005 URL: http://www.thehindubusinessline.com/2005/06/01/stories/2005060102190500.htm

Back Strategy review exercise under way in Polaris

Our Bureau

Mr Arun Jain, CMD, Polaris Software Lab

Chennai , May 31

POLARIS Software Lab Ltd has appointed a global management consulting firm to do a strategy validation, and to inform whether Polaris is on the right path.

The consultant started the exercise from May 1, and is expected to give its recommendations in three months, according to Mr Arun Jain, Chairman and Managing Director, Polaris Software.

Mr Jain told journalists that the firm would recommend Polaris the go-to-market strategy, which includes the business model, and also talk to Polaris customers. In the last few months, Polaris has set a footprint in to the top 15 global banks, and the consultant will recommend whether the company should go with the existing offerings or change the business model. Polaris is also moving towards offering end-to-end solutions for customers through a combination of products and solutions from the cost arbitrage model. In the past, projects used to be annual maintenance support model wherein the existing infrastructure had to be serviced, maintained and supported through outsourcing.

According to Mr Jain, Polaris was not part of some of the major deals signed during 2002 when the first phase of outsourcing happened. Then clients looked at vendor size, and deals went to tier-I firms. However, in the second wave of outsourcing, clients are looking at expertise-based outsourcing, and Polaris has a scope for growth.

Polaris will go to the market with product, service and experience in various sectors, including banking and financial, he said.

Out of $175 million revenues for 2004-05, contribution to the services business was $27 million. Investment in the product business during last fiscal was $10 million and in Optimus $3 million. "The investment of $13 million is pulling down the total number, which is looking dismal from the overall performance perspective. But, when we look internally at it, our service business is healthy," Mr Jain recently told analysts on the company's latest financial results.