Syntel, Inc. - Profile

Home About

Web www.companyseek.com

Syntel, Inc.

(248) 619-2800

525 E, Big Beaver Road, Suite 300

Troy, Michigan 48083

www.syntelinc.com

Sales

$180 million

Business Description

Syntel is a worldwide provider of information technology services to Global
2000 companies. The Company's service offerings aregrouped into three segments:

E-business, Applications Outsourcing, and TeamSourcing(R). E-business consists of

practice areas in Web Solutions, Customer Relationship Management (CRM),

Data Warehousing/Business Intelligence, and Enterprise Applications Integration

(EAI) services. Applications Outsourcing consists of outsourcing services for ongoing

management, development and maintenance of business applications. TeamSourcing

consists of professional information technology (IT) consulting services. Syntel believes

hat its service offerings are distinguished by its Global Delivery Service, a corporate
culture focused on customer service and responsiveness and its own internally
developed "intellectual capital" based on a proven set of methodologies,
practices and tools for managing the IT functions of its customers.

Through its E-business practices, Syntel helps its customers harness
advanced technologies to improve their businesses. Web Solutions involves
services in the areas of web architecture, web-enabling legacy applications, as
well as the creation of web portals. CRM involves customizing and implementing
CRM software packages to enhance a customer's interaction with its customers.
Data Warehousing/Business Intelligence involves gathering and analyzing key
business data to make better real-time decisions through "data mining."
Enterprise Applications Outsourcing involves consulting and Applications
Outsourcing services designed to better integrate front office and back office
applications. Additionally, the Company has entered into several partnerships to
provide it's implementation, customization, migration and maintenance services
with leading software and IT application software infrastructure providers
including BEA Systems, IBM, Informatica, Microsoft, Oracle, Sun and TIBCO. These
partnerships will provide the Company with increased opportunities for market
penetration.

Through Applications Outsourcing, Syntel provides higher-value applications
management services for ongoing management, development and maintenance of
customers' business applications. Syntel assumes responsibility for and manages
selected applications support functions of the customer. Utilizing its developed
methodologies, processes and tools, known as IntelliTransfer(R), the Company is
able to assimilate the business process knowledge of its customers to develop
and deliver services specifically tailored for that customer. In 2003, 2002 and
2001, E-business and Applications Outsourcing services combined accounted for
approximately 95%, 91% and 87% of total consolidated revenues, respectively.

Through TeamSourcing, Syntel provides professional IT consulting services
directly to customers. TeamSourcing services include systems specification,
design, development, implementation and maintenance of complex IT applications
involving diverse computer hardware, software, data and networking technologies
and practices. TeamSourcing services are provided by individual professionals
and teams of professionals dedicated to assisting customer IT departments with
systems projects and ongoing functions. TeamSourcing accounted for approximately
5%, 9% and 13% of revenues, for the years ended December 31, 2003, 2002 and
2001, respectively. The information set forth under Note 18 "Segment Reporting"
to the Consolidated Financial Statements attached as an exhibit to this Annual
Report on Form 10-K is incorporated here by reference.

The Company's Global Delivery Service provides Syntel with flexibility to
deliver to each customer a unique mix of services on-site at the customer's
location, off-site at Syntel's U.S. locations and offshore at Global Development
Centers in Mumbai, Chennai and Pune, India. The benefits to the customer from
this customized service approach include
responsive delivery based on an in-depth understanding of the specific processes
and needs of the customer, quick turnaround, access to the most knowledgeable
personnel and best practices, resource depth, 24-hour support seven days a week
and cost-effectiveness. By linking each of its service locations together
through a dedicated data and voice network, Syntel provides a seamless service
capability to its customers around the world largely unconstrained by geography,
time zones or cultures.

Syntel provides its services to a broad range of Global 2000 companies
principally in the financial services, manufacturing, retail, transportation and
information/communications industries, as well as to government entities. Its
five largest customers during 2003, based on revenues were American Express
Company, Target Corporation, Wells Fargo, American International Group, Inc. and
Daimler Chrysler. The Company has been chosen as a preferred vendor by several
of its customers and has been recognized for its quality and responsiveness. The
Company has a focused sales effort that includes a strategy of migrating
existing TeamSourcing customers to higher-value E-business and Applications
Outsourcing services. During recent years, the Company has focused on increasing
its resources in the development, marketing and sales of its E-business and
Applications Outsourcing services.

The Company believes its human resources are its most valuable asset and
invests significantly in programs to recruit, train and retain IT professionals.
The Company recruits globally through its worldwide recruiting network and
maintains a broad package of employee support programs. Syntel believes that its
management structure and human resources organization is designed to maximize
the Company's ability to efficiently expand its IT professional staff in
response to customer needs. As of December 31, 2003, Syntel's worldwide billable
headcount consisted of 2,664 IT consultants providing professional services to
Syntel's customers.

SYNTEL SOLUTION

Syntel provides E-business solutions in the areas of Web Solutions,
Customer Relationship Management (CRM), Data Warehousing/Business Intelligence,
and Enterprise Applications Integration (EAI). The Company's approach involves
taking an enterprise wide view of the customer's technology and business
environment to ensure comprehensive solution integration. This view is termed
the Digital Ecosystem. Syntel's methodology for implementing its E-business
services involves Digital Blueprinting/Build/Optimize(R). In the Digital
Blueprinting phase, Syntel's teams analyze the customers current technology
environment, their business objectives, and begins architecting the E-business
solution to meet these objectives. In the Build phase, Syntel actually
constructs the technology applications and integrates the necessary package
applications for the customer. In the Optimize phase, Syntel provides ongoing,
cost effective maintenance and enhancement services for the newly created
applications. Additionally, the Company has entered into several partnerships to
provide it's implementation, customization, migration and maintenance services
with leading software and IT application software infrastructure providers
including BEA Systems, IBM, Informatica, Microsoft, Oracle, Sun and TIBCO.

These partnerships will provide the Companywith increased opportunities for market

penetration.

Syntel provides comprehensive Applications Outsourcing services consisting
of applications management services for ongoing management, development and
maintenance of business applications, as well as TeamSourcing services
consisting of professional IT consulting services. The Company believes that its
Applications Outsourcing approach to IT services outsourcing, which involves
assuming responsibility for management of selected applications rather than
taking over an entire IT department or providing facilities management, provides
significant differentiation from its competitors in the IT services market.
Syntel believes that its E-business and Applications Outsourcing service
offerings are distinguished by its Global Delivery Service, a corporate culture
focused on customer service and responsiveness and its internally developed
"intellectual capital," comprised of a proven set of methodologies, practices
and tools for managing the IT functions of its customers.

GLOBAL DELIVERY SERVICE. Syntel performs its services on-site at the customer's
location, off-site at Syntel's U.S. locations and offshore at its Indian
locations. By linking each of its service locations together through a dedicated
data and voice network, Syntel provides a seamless service capability to its
customers around the world, largely unconstrained by geographies, time zones and
cultures. This Global Delivery Service gives the Company the flexibility to
deliver to each customer a unique mix of on-site, off-site and offshore services
to meet varying customer needs for direct interaction with Syntel personnel,
access to technical expertise, resource availability and cost-effective
delivery. The benefits to the customer from this customized service include
responsive delivery based on an in-depth understanding of the specific processes
and needs of the customer, quick turnaround, access to the most knowledgeable
personnel and best practices, resource depth, 24-hour support seven days a week,
and cost-effectiveness. To support its Global Delivery Service, the Company
currently has three Global Development Centers located in Mumbai, India; Pune,
India and Chennai, India. The company also has a Support Center located at Cary,
North Carolina.

In January 2001, the Company acquired 41 acres of land at the cost of
approximately $1.0 million for construction of a state-of-the-art development
and training campus in Pune, India. When fully completed, the facility will
cover over 1 million square feet and will accommodate 9,000 employees. It will
be both a customer and employee focused facility, including such amenities as
training facilities, cafeteria and fitness center. The Company has appointed a
leading project management company, finalized architectural drawings for Phase I
and has appointed contractors for all key elements of the project. The site
office is expected to be in place during Q1 2004 and actual construction is
expected to commence by Q2 of 2004, such that Phase I of 2500 seats is expected
to be ready by Q2 of 2005.

FOCUS ON CUSTOMER SERVICE. The Syntel corporate culture reflects a "customer for
life" philosophy, which emphasizes flexibility, responsiveness,
cost-consciousness and a tradition of excellence. The Company recognizes that
its best source for new business opportunities comes from existing customers and
believes its customer service is a significant factor in Syntel's high rate of
repeat business. At engagement initiation, Syntel's services are typically based
on expertise in the software life cycle and underlying technologies. Over time,
however, as Syntel develops an in-depth knowledge of a customer's business
processes,

IT applications and industry, Syntel gains a competitive advantage to perform
additional higher-value IT services for that customer.

PROVEN INTELLECTUAL CAPITAL. Over its 23-year history, Syntel has developed a
proven set of methodologies, practices, tools and technical expertise for the
development and management of its customers' information systems. This
"intellectual capital" of Syntel includes methodologies for the selection of
appropriate customer IT functions for management by Syntel, tools for the
transfer to Syntel of the systems knowledge of the customer, and techniques for
providing systems support improvements to the customer. Syntel also offers to
its customers well-trained personnel backed by a proven, extensive employee
training and continuing development program. The Company believes its
intellectual capital enhances its ability to understand customer needs, design
customized solutions and provide quality services on a timely and cost-effective
basis.

SERVICES

Syntel provides a broad range of IT services through its Applications
Outsourcing, E-business and TeamSourcing service offerings. Through Applications
Outsourcing offering, the Company provides complete software applications
development, maintenance and platform migration services. Through its E-business
practices, the Company provides advanced technology services in the areas of Web
Solutions, Customer Relationship Management (CRM), Data Warehousing/Business
Intelligence, and Enterprise

Applications Integration (EAI) and Enterprise Resource Planning (ERP) software
package implementation. Through TeamSourcing, the Company provides professional
IT consulting services. During the past year, the Company has increased the
personnel and resources dedicated to the development, marketing and sales of its
Applications Outsourcing and E-business services. TeamSourcing, E-business, and
Applications Outsourcing services are based on Syntel's methodologies and
technical expertise, which the Company continues to develop on an ongoing basis
in order to further enhance the value of its services to customers. For the
years ended December 31, 2003, 2002 and 2001, E-business and Applications
Outsourcing combined accounted for approximately 95%, 91% and 87%, respectively,
of the Company's revenues and TeamSourcing represented approximately 5%, 9% and
13%, respectively, of the Company's revenues.

Syntel's focus on customer service is evidenced by the high level of repeat
business from existing customers and the quality awards its customers have
bestowed on Syntel. In the fourth quarter of 2003, more than 86% of Syntel's
revenue came from clients the Company has worked with for at least one year.
Syntel has earned a host of quality awards, including the "CIO Award" from
General Motors, as well as "Preferred Supplier" status with Daimler-Chrysler
Corporation receiving the highest rating in each customer service category. The
Company has also been recognized by the Target Corporation with a "Best Business
Partner Award". Syntel's centers in India earned the highest possible quality
rating of the Software Engineering Institute (SEI) Capability Maturity Model
(CMM) Level 5. During 2003, Syntel also earned a host of media awards, including
Business 2.0 "100 fastest growing Tech companies," Healthcare informatics 100,
June 2003 (#61). VARBusiness 500 (#162), Crain's Detroit Business List: Top 50
Michigan Companies in Detroit, and the Dataquest Top 20 Multi-national Software
Exporters (#7) 2003.

E-BUSINESS SERVICES

Syntel provides strategic advanced technology services for the design,
development, implementation and maintenance of solutions to enable customers to
be more competitive. Many of today's advanced technology solutions are built
around utilization of the Internet, which has transformed many businesses. The
Company provides customized technology services in the areas of web solutions,
including web architecture, web-enablement of legacy applications, and portal
development. The Company also provides Customer Relationship Management
services, which involve software solutions to put customers in closer touch with
their own customers. Syntel helps customers select appropriate package software
options, then customize and implement the solutions. In the area of Data
Warehousing/Business Intelligence, Syntel helps customers make more strategic
use of information within their businesses through the development and
implementation of data warehouses and data mining tools. In the area of
Enterprise Applications Outsourcing, Syntel takes an enterprise wide view of its
customers' environment to implement package software solutions to create better
integration, and therefore better information utilization, between front office
and back office applications. Additionally, the Company has effectively engaged
several partnerships to provide it's implementation, customization, migration
and maintenance services with leading software and IT application software
infrastructure providers including BEA Systems, IBM, Informatica, Microsoft,
Oracle, Sun and TIBCO. These partnerships will provide the Company with
increased opportunities for market penetration.

APPLICATIONS OUTSOURCING

Syntel provides higher-value applications management services for
ongoing management, development and maintenance of business applications.
Through Applications Outsourcing, the Company assumes responsibility for, and
manages selected applications support functions of the customers. The Global
Delivery Service is central to Syntel's delivery of Applications Outsourcing
services. It enables the Company to respond to customers' needs for ongoing
service and flexibility and has provided the capability to become productive
quickly on a cost-effective basis to meet timing and resource demands for
mission critical applications.

Syntel has developed methodologies, processes and tools to effectively
integrate and execute Applications Outsourcing engagements. Referred to as
"IntelliTransfer(R)," this methodology is implemented in three stages of
planning, transition and launch. Syntel first focuses on the customer's
personnel, processes, technology and culture to develop a plan to effectively
assimilate the business process knowledge of the customer. Syntel then begins to
learn the business processes of the customer, and, finally, seeks to assume
responsibility for performance of a particular customer applications system or
systems. As the Company develops an in-depth knowledge of the customer's
personnel, processes, technology and culture, Syntel acquires a competitive
advantage to pursue more value-added services. The Company believes its approach
to providing these services results in a long-term customer relationship
involving a key Syntel role in the business processes and applications of the
customer.

Because providing both E-business and Applications Outsourcing services
typically involves close participation in the IT strategy of a customer's
organization, Syntel adjusts the manner in which it delivers these services to
meet the specific needs of each customer. For example, if the customer's
business requires fast delivery of a mission-critical applications update,
Syntel will combine its on-site professionals, who have knowledge of the
customer's business processes and applications, together with its global
infrastructure to deliver around-the-clock resources. If the customer's need is
for cost reduction, Syntel may increase the portion of work performed at its
offshore Global Development Center, which has significantly lower costs. The
Company believes that its ability to provide flexible service delivery and
access to resources permits responsiveness to customer needs and are important
factors that distinguish its E-business and Applications Outsourcing services
from other IT service firms.

TEAMSOURCING(R)

Syntel offers professional IT consulting services directly to its customers
and, to a lesser degree, in partnership with other service providers. The
professional IT consulting services include individual professionals and teams
of professionals dedicated to assisting customer systems projects and ongoing IT
functions. This service responds to the demand from internal IT departments for
additional expertise, technical skills and personnel. The Company's wide range
of TeamSourcing services include IT applications systems specification, design,
development, implementation and maintenance, which involve diverse computer
hardware, software, data and networking technologies and practices.

TECHNICAL SERVICES GROUP

The Company seeks to gain a competitive advantage through its
methodologies, tools and technical expertise. The Company employs a team of
professionals in its Technical Services Group whose mission is to develop and
formalize Syntel's "intellectual capital" for use by the entire Syntel
organization. The Technical Services Group focuses on
monitoring industry trends, creating competencies in emerging technical fields,
developing new methodologies, techniques and tools such as IntelliTransfer(R)
and IntelliCapture(sm), creating reusable software components through its
Innovate methodology to enhance quality and value on customer assignments, and
educating Syntel's personnel to improve marketing, sales and delivery
effectiveness. The Technical Services Group consists of senior technical
personnel located in both the U.S. and India.

SYNTEL STRATEGY

The Company's objective is to become a strategic partner with its customers
in the development of E-business solutions as well as the ongoing management,
development and maintenance of their IT systems by utilizing its Global Delivery
Service, intellectual capital and customer service orientation. The Company
plans to continue to pursue the following strategies to achieve this objective:

LEVERAGE GLOBAL DELIVERY SERVICE. The ability to deliver a seamless service
capability virtually anywhere in the world from its domestic and offshore
facilities gives the Company an effective ability to meet customer needs for
technical expertise, best practice IT solutions, resource availability,
responsive turnaround and cost-effective delivery. The Company strives to
leverage this capability to provide reliable and cost-effective services to its
existing customers, expand services to existing customers and to attract new
customers. Moreover, the flexibility and capacity of the Global Delivery Service
and the Company's worldwide recruitment and training programs enhance the
ability of the Company to expand its business as the number of customers grows
and their IT demands increase. The Company intends to expand the capacity of its
Global Development Centers worldwide.

AGGRESSIVELY BUILD E-BUSINESS COMPETENCIES. Through its comprehensive suite of
E-business services, the Company provides a key strategic role in helping
customers rapidly and cost-effectively build advanced technology solutions.
Through large-scale retraining programs, strategic acquisitions and
partnerships, the Company has quickly built a strong competency in the area of
E-business services.

CONTINUE TO GROW APPLICATIONS OUTSOURCING SERVICES. Through Applications
Outsourcing, the Company markets its higher value applications management
services for ongoing applications management, development and maintenance. In
recent years, the Company has significantly increased its investment in
Applications Outsourcing services and realigned its resources to focus on the
development, marketing and sales of its Applications Outsourcing and E-business
services, including the hiring of additional salespeople and senior managers,
redirecting personnel experienced in the sale of higher value contracts,
developing proprietary methodologies, increasing marketing efforts, and
redirecting organizational support in the areas of finance and administration,
human resources and legal.

EXPAND CUSTOMER BASE AND ROLE WITH CURRENT CUSTOMERS. The Company's sales
efforts include migrating existing TeamSourcing customers to higher value
E-business and Applications Outsourcing services. The Company's emphasis
on customer service and long-term relationships has enabled the Company to
generate recurring revenues from existing customers. The Company also seeks to
expand its customer base by leveraging its expertise in providing services to
the financial services, manufacturing, retail, transportation, and
information/communications industries, as well as to government entities. With
the expansion of the Company's Indian operations, the Company is increasing its
marketing efforts in other parts of the world, particularly in Europe.

ENHANCE PROPRIETARY KNOWLEDGE BASE AND EXPERTISE. The Company believes that its
"intellectual capital" of methodologies, practices, tools and technical
expertise is an important part of its competitive advantage. The Company strives
to continually enhance this knowledge base by creating competencies in emerging
technical fields such as Internet/intranet applications, client/server
applications, object-oriented software, E-commerce, and data warehousing
technology. The Company continually develops new methodologies and toolsets,
building skills in E-business, and acquiring a broad knowledge and expertise in
the IT functions of specific industries. Through these efforts, the Company
becomes more valuable to the customer, is often able to expand the scope of its
work to existing customers, and is able to offer industry-specific expertise.

ATTRACT AND RETAIN HIGHLY SKILLED IT PROFESSIONALS. The Company believes that
its human resources are its most valuable asset. Accordingly, its success
depends in large part upon its ability to attract, develop, motivate, retain and
effectively utilize highly skilled IT professionals. Over the years, the Company
has developed a worldwide recruiting network, logistical expertise to relocate
its personnel, and programs for human resource retention and development. The
Company (i) employs professional recruiters who recruit qualified professionals
throughout the U.S. and India, (ii) trains employees and new recruits through
both computer based training and its four training centers, one of which is
located in the U.S. and three of which are located in India, and (iii) maintains
a broad range of employee support programs, including relocation assistance, a
comprehensive benefits package, career planning, a qualified stock purchase
program, and incentive plans. The Company believes that its management structure
and human resources organization is designed to maximize the Company's ability
to efficiently expand its professional IT staff in response to customer needs.

PURSUE SELECTIVE PARTNERSHIP OPPORTUNITIES. The Company has entered into
partnership alliances with several software firms and IT application
infrastructure firms, including BEA Systems, IBM, Informatica, Microsoft,
Oracle, Sun and TIBCO. The alliances provide a strong software implementation
strategy for the customer, combining the partner's software with Syntel's
extensive implementation and delivery capabilities. Before entering into a
partnership alliance, the Company considers a number of criteria, including: (i)
technology employed; (ii) projected product lifecycles; (iii) size of the
potential market; (iv) software integration requirements of the product; and (v)
the reputation of the potential partner.