Since its inception about 18 years ago, ZRG International has focused mainly on providing software solutions to big firms. The Information Technology solutions provider specialises in providing systems for customer services functions. The Company's Chief Executive Ayub Butt told BR Research in a recent interview, that a large chunk of the firm's revenues has historically been generated from the banking and financial sector.
"It is not that we are solely focused on providing solutions for this sector," he clarified, adding that the skew towards banks is a result of consistent investments by the banks in upgrading and improving their customer services functions. Butt explained that his company has so far successfully completed projects for all five telecommunications services providers as well as major national companies including Pakistan State Oil, EFU Life Insurance and TCS Courier Services, in addition to 16 of the banks operating in the country.
"The other sectors have just not kept pace, when it comes to investing in their customer services functions and overall use of information technology to improve efficiencies across core and support business functions," he contended. However, the rapid growth witnessed by the banks and telcos in the early 2000s is also a memory of the past now. "Business activity over the past four years has been relatively slow everywhere, but more so in Pakistan," said the CEO. "Besides, the banks are not growing at a commensurate pace, as far as branchless banking and consumer banking are concerned. On the other hand, the telcos are also unlikely to bloom the way they did a few years back because cellphone subscriptions appear to have levelled off now and only marginal increases are expected in their client base from here on out".
But ZRG International is not throwing in the towel. Instead the Company has redirected its focus to diversify into other sectors and geographical regions. In the past, over 90 percent of the firm's revenues were generated from domestic revenue streams. Of this, about three-fourth of all business activity was generated from the banking sector. But all that is now changing, and fast.
"The future growth drivers of Pakistan's economy will be small and medium enterprises. Those progressive firms that are into consumer businesses will be our key focus area within the country going forward," contended Ayub Butt. The shift will not require any major shuffling within the Company, as Butt explained, "we already have the relevant software solutions needed by small and medium-sized companies; and with a little bit of trimming and customisation we can meet their needs". This translates into quick delivery times for SMEs while also ensuring that the overall cost of implementation is low enough for smaller businesses to afford.
Diversification lies within the natural growth trajectory of ZRG International, according to its chief executive; "we have made a good name for ourselves by completing numerous projects with many of the most renowned and largest companies within the Country. The brand equity we have nurtured over 18 years has made us a prominent name within the B2B realm, and smaller companies now aspire to implement the same sophisticated and latest systems as industry stalwarts. So we do not want to leave that market segment open for others".
Besides tapping small and medium-sized businesses in Pakistan, the Company is also increasing its regional presence. "In the early day of our business, we had experimented with the idea of hiring marketing firms in other regions like Africa and the Middle East, but we soon realised that was not the way to go," he said. The chief executive explained that the Company is engaged in a specialised IT business which mandates direct contact with prospective clients to better understand their particular requirements and also to be able to explain to them, the product offerings available with ZRG International.
However, the Company has formed partnerships with a network of dealers that help facilitate implementation of projects in other countries. "Within Pakistan, we use our internal resources for all business activities," said Ayub Butt.
About 60 employees comprise the workforce at ZRG International, majority of whom are IT professionals. But the Company was not always this well-manned. Ayub Butt recalled "when we started back in 1994, we were just three people, but the business we received in our early days from ANZ Grindlays Bank and other corporate clients allowed us to expand over time."
Growth in the firm's human resources has been deliberately slow. "Many of the local IT firms have very high employee turnover because they bring on people when they have projects to work on, but then they fire the extra help once the pile of work is cut down," he contended adding that, "we have always been conservative in our approach because we prefer to take on only those people who can add value to the enterprise and whom we can inculcate long-term relations with."
Butt attributed the early success that the Company has enjoyed to a core team of dedicated professionals. "Business volumes are not as high as they were at the peak of the banking and telecom sectors' booms but all we need are a couple of big projects to grow beyond previous levels," he said. "The main target is to continue to innovate and bring those solutions to market that are on the cutting edge of information technology to ensure that companies here can avail cost-effective and efficient software solutions. We keep our eyes on the prize, which simply put is total customer satisfaction," he summed up.