January 7, 2007 Sustaining Profitable Growth

2A.T. Kearney Agenda Tech Mahindra Imperative A. T. Kearney Growth Excellence Survey 2006 – Key findings Key Challenges for Tech Mahindra

3A.T. Kearney As Tech Mahindra rapidly transforms to a big company, it needs to realign its internal organisation to be ready to drive long term sustainability Key growth drivers Long standing relationship with BT Exclusive focus on the telecommunication industry - deep domain knowledge and execution expertise Demand from TSPs/ TEMs growing rapidly Mature delivery model, processes and quality systems Recognised parentage and experienced team Increasing business from non-BT clients and geographies beyond Europe Recent contracts indicate that TM would be a $ 1 bn company in near future Source: Tech Mahindra Annual Report 2006 Historic and expected revenues ($ million) Mid-sized company Large company Expected Key imperative : Prepare for the future Operating as a larger company poses a very different set of challenges than as a mid-sized company TM has to transform its internal organisation and processes over the next couple of years to align to its larger size and scale Also prepare itself for sustainable growth on a much larger scale of operations and revenues Lower pressure on near term business generation provides an opportunity to align its internal organisation to drive sustainable growth in future

4A.T. Kearney Agenda Tech Mahindra Imperative A. T. Kearney Growth Excellence Survey 2006 – Key findings The organic growth imperative Tactical and strategic organic growth moves and making it happen Key Challenges for Tech Mahindra

5A.T. Kearney Growth Excellence Survey The A.T. Kearney/Handelsblatt Growth Excellence Survey reveals the blueprint for successful profitable growth Overall growth trajectory Organic growth External growth 1 3 Time of impact Business impact Stretch Structure & Portfolio Sales & Marketing Bottlenecks & Ideas Tactical platform Strategic platform  45% CR3 1) OpeningScaleFocus Balance/ Alliance 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% HHI 2) Divers. Food Brewers Railroad Banks Insurance Airlines Divers. Chemicals Automotive Supplier Restaurants & Fast Food Steel Producer integrated Automotive Mfrs. Rubber & Tire Mfrs. Confectionary Truck & Trailer Mfrs. Shipbuilding Cigarette Defense Electr. Soft drinks Food Retail Drugs Telekom Natural gas liquids Integrated oil & gas Years Ore Mining Alumnium Producers Utilities Distillers

6A.T. Kearney Tele- communi- cations/Services Auto- motive suppliers Pharma Organic growth Consumer electronics RetailSteel Excerpt InsuranceFood External growth Organic and external growth rates of value growers (CAGR) 1) 1) Sales CAGR 2001 to 2005 of largest companies per industry with above-average sales and EBIT growth Across industries, value growers show impressive growth rates fueled by both, organic and external growth Sales growth (% p.a.)

7A.T. Kearney Agenda Tech Mahindra Imperative A. T. Kearney Growth Excellence Survey 2006 – Key findings The organic growth imperative Tactical and strategic organic growth moves and making it happened Key Challenges for Tech Mahindra

8A.T. Kearney Michael Fischer, CEO "Growth is pretty easy: Remove bottlenecks and capture untapped potentials." GROWTH EXCELLENCE SURVEY 2006 – Portfolio of participants Tactical and strategic moves to fully capture organic growth potentials Top performers Value growth Revenue growth Tactical and strategic organic growth moves

9A.T. Kearney Jeffrey R. Immelt, CEO "I know if I could define a process and set the right metrics, this company could go 100 miles an hour in the right direction … Now we execute growth as a process." Making organic growth happen

10A.T. Kearney Across industries, organic growth is driven by bursting bottlenecks, boosting growth ideas and stretching the strategy Relevance (indexed) 1) Business impact Stretch the strategy Tactical platform Strategic platform Time of impact Sharpen port-folios and focus structures Gain sales and marketing excellence Burst bottlenecks and boost growth ideas Organic growth moves Short-term impact in >180 growth projects since 2001: 2-6% in 1 st and 4-15% in 2 nd year 2) 1) Source: Growth Excellence Survey ) For large international corporations with sales of more than US$ 500 mil. p.a. Mid-term optimizations Project impact Tactical and strategic organic growth moves

11A.T. Kearney Select organic growth references Business impact Stretch the strategy Sharpen portfolio and focus structures Gain sales and marketing excellence Boost growth ideas and burst bottlenecks B2B B2C A.T. Kearney has helped several clients address each of these four aspects to realise profitable organic growth Appendix

12A.T. Kearney Inadequate organization, weak cost position and insufficient IT-support are most important barriers Growth barriers Growth Excellence Survey 2006 Inadequate pricing flexibility Inadequate growth orientation of incentive systems, e.g. EVA Innovation not part of the culture Inadequate products, solutions or services Ineffective sales and delivery processes Inadequate skills and competencies Mismatch of market potential and resource allocation Insufficient IT-support Weak cost position Inadequate organizational or decision structures Relevance: 0 = Not important10 = Highly important = Specific focus of top performers Tactical and strategic organic growth moves: Burst bottlenecks and boost growth ideas

13A.T. Kearney In sales & marketing, customer intelligence and relationship management are major actions Sales & marketing optimizations Growth Excellence Survey 2006 Strengthen skills and training Consistently apply communications strategy Optimize pricing Enhance sales force management Strengthen branding Apply consistent value propositions Intensify key account management Optimize market intelligence Optimize customer intelligence Enhance customer relationship management Relevance: 0 = Not important10 = Highly important = Specific focus of top performers Tactical and strategic organic growth moves: Gain sales & marketing excellence

14A.T. Kearney Customer portfolio optimizations are most important for growth in the next three to five years Portfolio optimizations Growth Excellence Survey 2006 Channels Regions/countries Services Solutions Products Customer groups Relevance: 0 = Not important10 = Highly important = Specific focus of top performers Tactical and strategic organic growth moves: Sharpen portfolios and focus structures

15A.T. Kearney New offerings, customers and co-operations are the most important stretch drivers Strategic stretches and innovations Growth Excellence Survey 2006 Knowledge stretch towards other products New distribution channels Convenience orientation Turning products into solutions Speed of delivery Services New technologies New co-operations and partnerships New customers New offerings Relevance: 0 = Not important10 = Highly important = Specific focus of top performers Tactical and strategic organic growth moves: Stretch the strategy

16A.T. Kearney Talent acquisition and development Examples Private – Public partnerships: Partnering with educational institutions to educate young students to computers and IT Infosys has a ‘Catch them Young’ program to expose young youth to the world of IT, targeting class IX students CTS plans to invest US$ 76 Mn to build more high-tech campuses in India Identifying special resource requirements up front and communicating resource gap Certified interviewing panels & significant senior management time in recruitment & training Delivery Process Maturity - Global Modular Global Sourcing – applies fundamental concepts of modularization to business processes and IT solutions Act on a global level using strategic global delivery to ensure predictability of cost, quality, risk, and meeting shared business objectives. CMM and ISO process certifications Customer relationship and account management process rigor Strong tools for large/complex project management – progress/budget tracking, staffing management and team communication Knowledge Management HR Management/Value proposition TCS has the lowest attrition levels in the Indian Industry due to its structured HR management Gauging employee satisfaction through survey – PULSE One-on-one with senior management for career progression and development areas – PEEP Personal Development Program – PDP Rigorous training at Global Competency Center (GCC) and Internal Competency Center (ICC) Ongoing talent transformation for skill enhancement First to introduce E-Sops in India – created millionaires in large numbers who went ahead to start new companies and businesses. Celebrated becoming a Billion $ company by giving $25 Mn in bonuses Wipro recognizes with innovative rewards – In staff gatherings, employees are christened as the guest of honors for his/her contribution to an initiative and rewarded with gifts from his colleagues Organization Culture Have open-culture welcoming ideas from every employee through Open Multi-model communication Transparent evaluation system Org and Decision Making Structure Move from centralized to de-centralized as company grows. Customer Centric structure divided as Vertical business units (VBU) Horizontal competency unit (HCU) and Regional business units (RBU); supported by Strategic Support Units P&L at lower levels to drive accountability (TCS) Sharing of wealth Systems and tools Automate metrics data collection and stream-line the metrics management process HR and training processes automated eCockpit™ - a powerful decision support and project management tool Qsmart - automates Software Quality Assurance eTracker (web based) for Application Value Management (AVM) projects Integrated Sales/CRM tools (Oracle) Burst bottlenecks and boost growth ideas – Best practices Tactical and strategic organic growth moves: Burst bottlenecks and boost growth ideas Integrated, global, knowledge management system (to help with BD as well as Delivery) Creating an environment and tools for collaborative knowledge sharing Developing knowledge workers through senior management leadership

17A.T. Kearney Customer segmentation Examples Usage patterns/needs and value based micro- segmentation of mobile workers in B2B segment Development of specific value propo-sition and alignment of marketing mix Key account management Shadow strategies with focus on top management strategic dialogue CxO relationship building Deep customer understanding and customization of offerings Joint ownerships of business case through extensive interaction with customers Funnel management Funnel management with defined gates. Qualification and categorization, lead clarification, project scoping, target environment definition Resource focus on attractive leads and RfP Sales management Top-down development of balance scorecard in alignment with strategic targets and key success factors Clear KPI and cascading of scorecard for countries, functions, divisions Three-level partner program for –Gold: System integrators, national –Silver: Mid-size/small system integrators and system houses, regional –Bronze: Small certified partners, local Structured channel management considering also distributors, authorized resellers, learning partners Sales planning Top-down and bottoming planning process incl. alignment of plans, tailoring forecasts to reflect regional variation, structured negotiations between headquarters and regions Customer approach Sales force structured by farmers and hunters Differentiated roles, targets, trainings Specific staff requirements/selection for current and prospective/new business Partner management 6-step consultative selling approach: diagnose, prescribe, calculate ROI, message with customers, collaborate, report value and ROI Focus on value and ROI Addressing the entire sales life cycle Consultative selling and value proposition creation Systems and tools Consolidation of lead management system, customer database, account planning and other sales force tools on one platform Global accessibility Sales & marketing best practices Tactical and strategic organic growth moves: Gain sales & marketing excellence

18A.T. Kearney Key best practices in next generation sales (consultative and CXO selling) Alignment — Right Customers, Resources Focus on select customer segments, solutions, partnerships Broad coverage model with multiple go-to-market relationships Clearly defined roles to avoid channel conflict Tiered indirect distribution model with a focus, with “high-touch” sales support model for top-level customers/accounts Effectiveness — Right Solutions, Capabilities, Skills Dedicated teams for managing relationships at key accounts. “Lower-touch” model (incl. indirect) for remainder Standardized, formal account management tools/process Consistent account management/prospecting skills (limited spread of $/sales person) CxO relationships at all major accounts. Shadow strategy approach to CxO issue identification Compelling, go-to-market offers, customized to address CxO issues for each customer segment Knowledge management process for leveraging solutions/offers across accounts Efficiency — Right Processes, Metrics Standard, streamlined processes; integrated with finance and supply chain (e.g. forecasting, opportunity management, OTC) Measurement framework focused on more than revenue and quota attainment. Focus on: loyalty, recurring revenue, mix, and margin Right Customers and Resources Right Processes and Metrics Right Solutions, Capabilities and Skills Key best practices Alignment/S tructure Effectiveness Efficiency Sales Skills Enhancement Sales Processes & Metrics Account Management Tools Coverage Model and Sales Structure Field-ready Value Propositions Alliances/ Partners Next Generation Sales Model Partnership and Co-operations Consultative Selling Tactical and strategic organic growth moves: Gain sales & marketing excellence

19A.T. Kearney Vision, leadership and implementation power are especially relevant for large scale growth programs Success factors for large scale growth programs Growth Excellence Survey 2006 Relevance: 0 = Not important10 = Highly important = Specific focus of top performers Early wins Strong financial incentives Clear allocation of budgets Change or culture management Intense communication Buy-in and commitment of involved people Clear roles and responsibilities Overall vision Concrete action plan Clear leadership Making organic growth happen

20A.T. Kearney Making organic growth an integral part of the culture matters most for assuring sustainable growth Anchoring organic growth in the organization Growth Excellence Survey 2006 Non-monetary incentives Strong role models Being object of an own process Monetary incentives MBOs/target setting Organic growth as integral part of the culture Relevance: 0 = Not important10 = Highly important = Specific focus of top performers Making organic growth happen

21A.T. Kearney With its program "Growth as a Process" General Electric realizes organic growth of 8-10% p.a. Organic growth moves Selected Actions Business impact Stretch the strategy Sharpen portfolio and focus structures Gain sales and marketing excellence Boost growth ideas and burst bottlenecks Growth traits: inspire and develop people who know how to help customers and GE grow; build-up domain knowledge At the customer, for the customer: bring GE‘s best practices, tools and pro-grams to customers facing their own managerial challenges Customer dreaming sessions: assemble influential and creative people in an industry to envision its future and derive potential solutions Pricing: equip sales staff with better tools and metrics and eliminate discretionary pricing Marketing leadership program: intensive course for promising talents Great technology: have the best products, content, services; divest areas in which product excellence can not be obtained Imagination break- throughs: take risk and develop new capabilities, e.g. hybrid Locomotive One GE: Enterprise selling for selected projects/ customers/countries only Cross selling of specifically developed offerings and visions, e.g. ecomagination (applying GE technology to drive energy efficiency and improve environmental performance) Customer optimization mind- set: don’t de-featurize standard products for regional target groups, develop offerings locally to meet requirements and prices from scratch (developing markets) Making organic growth happen

22A.T. Kearney Business impact Stretch the strategy Sharpen portfolio and focus structures Gain sales and marketing excellence Boost growth ideas and burst bottlenecks Organic growth moves Alignment of organization and responsibilities along value chain Variable incentivation linked to share price development, revenue growth and profitability Globally spread service centers for 24/7-service and short response times Offshoring of coding and service activities Key account management Implementation and development of regional sales organizations serving customers locally Database tracking of sales efforts and customer‘s installed systems Joint sales and develop- ment core meetings to align customer needs with internal developing resources Assignment of clear pro-duct and service portfolio responsibilities Tailoring products to industry specific needs Bundling software with maintenance, consulting and training Channel- and partner- management to serve the volume business Adoption of promising technologies through venture capital activities Extension of product base: from single-product (ERP) to multi-product company/ solution provider Approach small and medium sized business customers additionally to large enterprises Source: SAP annual report 2005; Article: "Wertorientierte Unternehmensführung bei der SAP", Brandt/Zencke, 2005 Selected Actions Making organic growth happen Combining organic growth moves SAP realizes average profitable sales growth of 20% p.a. since 1994

23A.T. Kearney Agenda Tech Mahindra Imperative A. T. Kearney Growth Excellence Survey 2006 – Key findings Key Challenges for Tech Mahindra

24A.T. Kearney Several dimensions will be impacted as Tech Mahindra transitions from a small to a large company DimensionPre-2006Post 2006 ClientsLimited set of clientsLarge number of clients ProjectsFew large projects focused on BT in UKMultiple large projects across clients and geographies ReachGeographic presence limited to India and UK with limited number of offices Large number of countries and offices TCS, Infosys, Wipro have presence in over countries VisibilityComparative anonymity as a mid-sized unlisted company Increase visibility as it grows as a listed company Go-to-marketSales force focused on getting new business with existing accounts Intense focus on meeting the annual growth targets Gain new business against established competitors Management ApproachMore hands-on management Fire-fighting could work De-centralised decision making Need for systems and processes PeopleSmaller number of largely Indian employeesLarge number of employees, with increasing share of other nationalities Culture“I know everyone” “We are gonna make it happen” “I am a cog in the wheel” “What's in it for me?” Sample list

25A.T. Kearney IT services organisations have certain specific success drivers IT Services Industry Analysis Framework Vision, Mission & Strategy Where To CompeteHow To Compete Size & reach Target segments Geographic focus Business Model Sales & Marketing People Management Value chain focus Delivery Model Partnership model Project Management Enablers IT & Systems Structure Processes Competencies Key challenges for Tech Mahindra have been identified based on learnings from both Indian IT services companies and other high growth companies

26A.T. Kearney Strategy for sustaining growth requires the company to dream big and continue to invest in the business One of the common aspects of large organizations is to think BIG Wipro set an ambitious target of becoming a $ 4 Billion company by The famous “4 in 4 plan” under the leadership of Vivek Paul. While they weren’t able to reach the set target, they have still grew exponentially from a $150 Mn (2000) to $ 2 Bn in 5 years TCS has been working towards the ambitious target of breaking into the Global top 10 by The Vision Statement of “$ 10 Bn revenues by 2010” is a drive towards this goal. During the growth phase, one of the key to sustenance is to maintain a steady return and re-invest the rest into the business to win new-customers and ramp-up existing clients CTS has a philosophy to plough back into the business anything in excess of 20% of margins. With clients expecting broader range of work to offshore, they are looking for a partner with deep industry expertise, analytical skills and geographic spread. Growth organisation keep reinventing themselves in terms of the business verticals, service offerings and customers Infosys and Wipro have placed big bets on BPO services to leverage their brand, sales reach and ability to manage service organisations Allows the company to have a portfolio of revenue streams - cash cows, growth drivers and future bets Set Audacious Goals and think Global Re-investing in the business Continuously reinvent around a core

27A.T. Kearney Global delivery model and moving up the value chain are consistent patterns that emerge Building block for the success of large IT services companies has been the “Global Delivery Model” Top 3 Indian software firms (TCS, Infosys & Wipro) have been able to reach the $1Bn league by working with this model In a Transnational Business Model a company’s work is performed at places where talent can be tapped most efficiently. Infosys has 7 delivery locations outside India; TCS has established delivery centers in China, Latin America, S.Africa to tap the talent from these growing economies Key to the success of this model is to set-up infrastructure that facilitates communication between far-flung offices around the globe. Once limited to software programming, top IT firms have gained expertise in practically every part of the value-chain – system integration, Consulting, Infrastructure management, developing products, etc. This has led to larger and longer contracts with clients and transforming ‘Customers into Partners’ TCS has bagged a 12 year contract with Britain’s Pearl Insurance for $850 Mn Wipro has been ranked on par with Accenture, EDS by GM after experiencing the quality of work and their commitment Large companies have multiple services offerings across customers and geographies The complexity escalates in operating multiple business lines such as systems integration, infrastructure management, BPO of considerable size and scale in different geographies This causes significant stress on financial and HR systems requiring greater degree of checks and balances Moving up the value-chain Global Delivery Model Ability to address complexity

28A.T. Kearney Sales and marketing Focus on CxO relationship building, deep customer understanding and customization of offerings resulting in joint ownerships of business case through extensive interaction with customers Vodafone has divided its corporate sales force into hunters and farmers to manage new versus existing customer sales Strong customer management system and market intelligence database Oracle has consolidated its lead management system, customer database, account planning and other sales force tools on one platform with global accessibility Strong and structured lead management systems Oracle has consolidated its lead management system, customer database, account planning and other sales force tools on one platform with global accessibility EDS has a funnel management with defined gates. Qualification and categorization, lead clarification, project scoping, target environment definition With more than 90% of business coming from repeat clients, the need to be customer-centric is unquestioned Ongoing surveys and feedback from customers to measure the satisfaction-levels and drive improvements Brands are critical as much of offshore business gets commoditised Brands of Infosys and Wipro have a strong recall in the minds of customers and employees allowing them significant leverage Brand building is through multiple sources including Nasdaq listing, millionaire employees, etc… Customer Proximity and Key Account Management Make Customer Care the Foundation Structured Sales Processes Build & Leverage the brand

29A.T. Kearney People Management Most companies follow the principle of “Sharing of wealth increases the pie” Infosys – the first to introduce E-Sops in India – created millionaires in large numbers who went ahead to start new companies and businesses. CTS, whose compensation levels are in the top quartile in the industry has ESOPs for high performers and for all employees who have remained for more then 4 years. Wipro recognizes with innovative rewards – In staff gatherings, employees are christened as the guest of honors for his/her contribution to an initiative and rewarded with gifts from his colleagues According to a recent study, there is an expected shortage of around 350,000 engineers in the IT sector by The leading IT companies are partnering with educational institutions to educate young students to computers and IT Infosys has a ‘Catch them Young’ program to expose young youth to the world of IT, targeting class IX students CTS plans to invest US$ 76 Mn to build more high-tech campuses in India As firms grow in size, decision making has to be de-centralised to reduce lead-time and enhance operational efficiency. A right mix of control and de-centralized decision making is key to a growing organization Also critical to provide adequate career development opportunities to the enhanced workforce This also entails managing through MBOs/targets which can function only through strong processes for performance management, career development and strategic planning & target setting Sharing of Wealth with employees Creating talent for the future Decentralised decision making

30A.T. Kearney People Management (Cont’d) Given the labour scarcity and high attrition rates, it is an ongoing challenge is to increase employee loyalty and, in parallel hiring and training junior employees The recruitment – training – deployment process has to operate like an assembly line while keeping in view the human element Critical to set in place robust performance management/career development processes for the massive workforce of widely dispersed people - ensure fairness in evaluation /rewards and differentiate stars Innovative staffing processes that allows ongoing skill recording & tracking; project staffing requirements assessed in the pre/post sales phase; advance planning to meet these Break down the staffing pool in manageable buckets – geographic, skill based, team based, etc. Ability to plan for the future with a buffer - during the growth phase, having capacity to quickly ramp-up to clients’ demands is better than lower bench Price and technical skill are hygiene factors, clients highly value the quality of interaction with their suppliers A positive cultural fit reassures the buyer and provides them a feeling of trust In the top 5 Indian companies, we can see a steady rise in the percentage of foreign nationals especially for the customer-facing roles With such a large and diverse groups of people, maintaining the DNA of the company’s culture is a challenge. Successful companies develop smaller ecosystems through structural interventions to maintain the small company feel and sense of belonging for the employees Attracting and retaining the right talent Scaled up & flexible staffing processes Embracing a global workforce Managing the company culture

31A.T. Kearney Project Management While managing growth, one of the biggest challenge is adherence to system and maintain quality of output Though companies have initially sourced from Indian IT industry for cost competitiveness, quality and enhanced competitiveness have induced them to continue and expand 80 out of the world’s 117 SEI CMM level 5 companies are present in India ISO 9001 and six sigma practices are increasingly becoming a common quality initiatives amongst large Indian IT suppliers Strong tools for large & complex project management – progress/budget tracking, staffing management and team communication Strong MIS systems to display key project metrics across geographies to the leadership team EDS has a e-dashboard that displays the status of project around the world with flags in case of any issues Large IT services companies aggressively modularise project components for re-use Allows greater flexibility and ease in staffing and training Lower costs that can be shared between the company and the customers Faster speed to market Leverage technology to reduce costs and time BPO companies are pursuing technologies like net based self help solutions, IVR etc. to improve process efficiency and reduce costs A systematic way of identifying, capturing, and distributing knowledge for reuse, learning and awareness across organization Need to develop a pervasive culture of beneficent knowledge exchange across geographies Modularise and re-use Adherence to system and quality Project Management Knowledge Management

32A.T. Kearney Thank You