Nov. 4, 2009 (The Hindu Business Line) --

T. E. Raja Simhan

Chennai, Nov. 4 Cognizant Technology Solutions (NASDAQ:CTSH) does not expect any significant change in its clients’ IT spends.

“I am not hearing anything about across-the-board dramatic reductions in budgets,” the company’s President and Chief Executive Officer, Mr Francisco D’Souza, told an analysts conference on Wednesday.

“I’m hearing ‘flat’ to ‘slightly up’ in some cases,” he said.

The indication right now is that it will not be like what it was during the 2009 cycle when budgets really did not get finalised until in many cases the second quarter.

Although Cognizant’s take is that the clients would rather wait until the current quarter goes to take a call on the budget for next year, the company is assuming that the budgets will be finalised by late Q1, Mr D’Souza said.

He said that the clients thinking about off-shoring has undergone a change. They are no longer looking at off-shoring from the standpoint of efficiency or cost savings.

But, unlike in the past, the clients are buying multiple services in the first couple of years of engagement with Cognizant. “We are seeing acceleration (of off-shoring) from that standpoint,” he said. Earlier, usually Cognizant would first sell a service, get it stabilised with the client and then cross-sell other services.