India is in lockdown. But from home the Indian IT industry still keeps the back offices of large and small internationals running. And that is an interesting development for Genexis, the European market leader in fiberglass modems. The Brabant Company is in poll position in the EU. Additionally, its sister company GX Group also leads the fiberglass market in India. “Now that India has been locked up, you can see the country’s rapid adaptability. One thing is certain: corona lockdown will make broadband in India a priority”, says Genexis CEO, Gerlas van den Hoven.
The employees of Genexis India have been working from home since the lock-down was declared. According to Gerlas, this turnaround is more flawless than expected. “Most of them have a broadband connection at home with no more than a few Mbps. Yet our software engineers manage to do a good job. Research shows that Indian companies have significantly scaled up homeworking opportunities in a short period of time. The number of companies offering remote work opportunities since the lockdown has increased from 20% to 96%. “That gives our industry, especially in India, a boost.”
Genexis India, now GX Group, has been working for 7 years in the Southeast Asian country. “Unlike most companies, we didn’t go to India with the intention of outsourcing or setting up an R&D team,” says Gerlas. “It all started with one of our salespeople, Paritosh Prajapati, who worked for our facility in Sweden. He saw a lot going on in India in the field of fiberglass and approached us to see if he could do some market research there. “Why not?” we thought and sent him with a business developer that way.”
From that moment on it went fast. “He immediately saw that there were opportunities for us in the Indian market. But, Paritosh didn’t know how to start a business there, any more than we did.” According to Gerlas, it is essential to have someone on the ground who you trust and who understands the culture and the language. “Paritosh had a good sales team together in no time because of his good contacts. Further, he could also find the right people to arrange things he didn’t know about himself. Things such as a PAN number, taxes and permits”. The jump was attempted, Genexis set up a private limited company, rented an office and got going.
For a well-functioning R&D team in India, you need a local manager who understands Europe and India.
For the first four years, Genexis could only just keep its head above water in India. Small projects were dragged in, but it didn’t yield enough. “Instead of cleaning up the mess and taking our losses, we adjusted our expectations and chose to continue. India is not a country where you sit for the short term. Hence, we decided to invest heavily in two things”.
First of all, an R&D team was set up to develop software for the European market. Genexis had been struggling for some time with a shortage of good engineers and did not fill vacancies in Europe. “In India, the supply of software people was much larger and the price tag was much lower”. With Paritosh at the head of the Indian branch, they had a very good ‘translation bridge’ between Europe and India. “Because Paritosh is a Swede, he understands exactly what quality we want in Europe. Further, because of his Indian background, he can perfectly translate that into the Indian way of working. Such a person is essential if you want to succeed as a European company in a country like India.
“Win a public contract”? Then you have to show your face’
Investments were also made in sales in India. To identify why Genexis products were not in demand, Gerlas and team took a close look at the Indian market. “We went to several places to see how fiberglass is installed in India and that was an eye-opener. For example, it is quite normal to tie the fiber-optic cables to poles or pull them over trees. I also went inside someone’s house and saw the fibre optic cable going into the living room through the window. It lies like a bunch in the corner with the modem on top. It was immediately clear that our chic European modems were a total mismatch with the needs of Indian consumers. And, we had to offer a total solution”.
A simple modem for the consumer and associated central equipment for Internet providers, turned out to be the major gap. Genexis is now involved in local projects on a large scale. “In the rich neighborhoods, fiber optic cable is being rolled out en masse. We then visit the local cable club, which is often very interested in our total solutions. This is because they fit in well with the wishes of the Indian user. Our product may be a bit more expensive than average, but it is the simplest in maintenance and installation. Now, that makes us an interesting party”. Gerlas advice for entrepreneurs who want to compete for public contracts is patience. “In India, you have to be there, you have to show your face. We have been here for seven years. Besides, we have worked on so many projects that we are now an established name. That creates trust.”
It’s not all hosanna for Genexis in India. “We’ve seen more than once now that an Indian customer places a large order. However, doesn’t pay the bills after we’ve delivered. Then you also notice how convenient it is to have someone on your team who knows both cultures. For example, you don’t have to put your fist on the table three days after the payment deadline has passed. But you also can’t allow a customer like that to say: ‘come and pick up that stuff again. You have to dare to stand firm and eventually take the step to court if necessary.”
According to the CEO of Genexis, you don’t take that legal step to get your money, but to show that you dare to start a business. “The risk for a Dutch company is small. An Indian lawyer is comparatively cheap. And, you lose a maximum of about 10,000 to 15,000 if the law is not decided in your favor”. But the most important thing, according to Gerlas, is that once you have made your way to court, it is often no longer necessary to take such a drastic step in a subsequent dispute. “We have proven to be a serious European company and that has status. The Indian companies we work with often also have a reputation in their sector. In fact, they prefer not to risk it, so they choose eggs for their money”.
“Building a bond with your staff is a hundred times more important in India than anywhere else.
Genexis India has been split off from the Dutch part for a year now. It continues with Paritosh as CEO under the name GX Group. The ambitions for the future are high. “We are now on poll position in this market. Further, we expect that India will rapidly roll out broadband and mobile network over the next five years. That prediction now seems to be accelerating due to the coronavirus. However, GX Group also had to endure some minor setbacks due to the outbreak. For example, a large event that GX Group was to organise for their sector for the first time this year, could not take place in February.
“Very unfortunate of course, because we wanted to use this event to launch the new name GX Group. Further, with this event we wanted to put ourselves back on the market. But more importantly for us, we were able to celebrate our annual staff party on time. India is a real family country. Hence, building a bond with your staff is a hundred times more important than anywhere else. The fact that we were all able to get back on the dance floor before the country locked down is a great reminder at this crazy time”.