Capability, not capacity, drives our strategy: Cognizant CFO

CHENNAI | BANGALORE: Cognizant Technology Solutions, the $2.89-billion US-headquartered IT services major, was in the news recently for its reported interest in bidding for Satyam Computers. The company���s chief financial and operating officer Gordon Coburn is categorical that it would not look for ���scale��� ��� but look to deepen domain and consulting skills ��� in its acquisitions even as it scans for future buyouts. Excerpts:

What is Cognizant���s strategy for acquisitions?

Cognizant���s acquisition philosophy is three-fold: deepen our domain and consulting capability, expand our geographic footprint, and enrich our services mix. All acquisitions that Cognizant has done till date have fit one or more of these criteria.

Will Cognizant look for scale in its acquisitions?

Cognizant is already ���at scale���. Our acquisition philosophy is to acquire for capability and not for capacity. Cognizant is now a tier I provider and can deliver for any client-need at scale.

How important is the process of acquisition?

We are extremely disciplined buyers. We have some strict criteria and do not compromise.

How does Cognizant fund acquisitions?

All acquisitions done till date have been through internal cash accruals. At the end of December 2008, Cognizant had $924 million in cash, short-term and long-term investments. And, we expect to continue to generate significant annual cash flow from operations.