Business Strategy

Strategy helps an organization to make choices and, more importantly, trade-offs. An effective strategy aligns stakeholders — clients, employees, partners, society and shareholders — to pursue shared goals of success and value creation. This shared focus ensures mutual interlocking and reinforcement of numerous decisions made daily across various aspects of the business. The key to the success of any strategy is to ensure the right choices are made consistently by all stakeholders by articulating the strategy clearly.

For over four decades, HCLTech has built a culture of empowerment and innovation. Our leaders play a crucial role in translating strategy into practical, flexible guidelines that can be easily followed and implemented by everyone. To unleash the creative potential of our people, our strategic framework has remained simple and clear, aligned to the art of the possible. This simple yet effective approach ignites passion and ownership among our employees. We set forth a small set of priorities vital for our success and empower our people to execute them with enthusiasm and boldness.

Aligned to this approach, we have our five medium-term strategic objectives:

• Leadership through differentiated services and products leveraging our engineering pedigree
• Employer of choice for professional services talent across chosen geographies
• Preferred digital and AI partner for Global 2000, equivalent and emerging enterprises in chosen markets
• Weave ESG (Environmental, Social and Governance) into business strategy
• Continue to deliver top quartile TSR (Total Shareholder Return) over the medium-term

These medium-term strategic objectives (SOs) address the critical components necessary for business success, ensuring that all aspects of the organization, including goals, resources and activities, are coordinated and aligned to achieve the desired outcomes. We regularly assess and update our strategic objectives to ensure they remain relevant, leading to revisions in FY25. We have expanded further on each of these strategic objectives in the Management Discussion and Analysis (MD&A) section.

The underlying principles that guide us in pursuing and attaining these strategic objectives are as follows:

• Our culture of empowerment and innovation - Our commitment to excellence is deeply embedded in our cultural DNA. Our culture combines optimism with realism, driving passion and innovation.
• Talent is at the center of every decision – Our employee value proposition, ‘Find your Spark,’ aims to inspire and empower employees by aligning our business model and talent strategy with their aspirations. We focus on creating enriching experiences and a next-gen work environment to help employees reach their full potential.
• Enablement to drive execution - HCLTech ensures strategic objectives are clear and achievable by breaking them into specific initiatives, more importantly supported by enablement frameworks and cross-functional collaboration. This approach aligns initiatives with broader objectives, driving organizational interlock, key to success and growth.
• Beyond benchmarking - HCLTech uses benchmarking to identify and adopt best practices and drive strategic objectives, focusing on parameters like stakeholder satisfaction and financial performance. This approach aims to advance strategic objectives rather than just aligning with competitors.
• Benefit from current and future opportunities - We use a structured approach to detect market disruptions early, converting risks into opportunities for both short-term and long-term growth. We continuously monitor market signals to identify and capitalize on opportunities across existing and new domains and act promptly to gain competitive advantage.
• Rethink competitive advantage through non-linear approach - HCLTech is focusing on achieving non-linear growth by leveraging AI/GenAI and other emerging technologies to enhance client experiences, drive innovation and improve efficiency. The company aims to decouple revenue from traditional models through AI-driven innovation and integration of advanced technologies, fostering a dynamic and customer-centric ecosystem.
• Enhance value through efficient capital allocation - HCLTech practices disciplined budgeting and strategic investment to ensure efficient capital use, driving value through sustainable growth and competitive advantage. This approach enables resilience and long-term stakeholder value.
• Align the larger ecosystem to strategic objectives - We communicate our strategic goals and progress to key external stakeholders through regular updates and transparent reporting. This approach attracts clients, investors and partners, fostering trust, driving growth and aligning them with our long-term journey.

Peter Drucker’s epithet that “strategy is a commodity, execution is an art” is often mentioned to reinforce the importance of culture in executing strategy. This assertion underscores the idea that while formulating a strategic plan is imperative, the true test lies in its implementation. The organizational culture sets the tone for how strategies are perceived, accepted and executed. At HCLTech, through the intelligent integration of both culture and strategy, we execute impeccably to supercharge progress.

Value Creation Model

HCLTech leverages Financial Capital as a foundational pillar in its holistic Value Creation Model, enabling sustainable growth, innovation and stakeholder returns. The company’s healthy growth and profit margins reflect efficient operations and effective cost management. Supported by strategic investments and prudent risk management, HCLTech maintains liquidity and stability, offering attractive returns to shareholders while aligning with long-term objectives.

By prioritizing innovation and operational excellence, HCLTech, equipped to handle future challenges and seize new opportunities in the technology sector, is well positioned to help steer our clients favourably in an ever-evolving landscape. Our strong financial health and strategic foresight enhance our competitive edge and foster enduring stakeholder relationships for continued market success.

Managing Financial Capital

As a company with significant cash generation, we recognize the critical role that financial capital plays in supporting our strategic initiatives, ensuring operational efficiency and promoting sustainable growth. Our financial stability enables us to utilize financial capital effectively, thereby creating long-term value for our stakeholders and maintaining our competitiveness in the market.

Our robust cash flow supports investments in growth, aids in navigating economic downturns and ensures value is returned to shareholders. This year, we achieved Free Cash Flow (FCF) of ₹21,153 crores ($2.5 billion), representing 123% of our Net Income (NI). With this strong cash position, we can finance strategic initiatives without over-relying on external funding, thereby minimizing financial risk and increasing resilience. With robust forex management, we seamlessly handle multi-currency operations across diverse time zones and international markets, leveraging automated rate updates, hedging strategies and real-time reconciliation. To ensure predictability and stability in our income statement, we mitigate financial risks associated with foreign currency fluctuations and geopolitical instability.

We generate strong cash flow by optimizing global operations with automated billing and collection processes, supported by efficient working capital management. Our efforts have significantly reduced Days Sales Outstanding (DSO), placing us among the industry’s best.

HCLTech’s capital allocation strategy aims to enhance shareholder value through careful planning and investments. By maintaining strong return ratios and improving Free Cash Flow (FCF), the company ensures a solid financial foundation. This supports both organic and inorganic growth, dividends and a healthy balance sheet. By investing in advanced technologies such as GenAI and AI, HCLTech remains at the forefront of industry trends to meet client needs. Moreover, a return on invested capital (ROIC) of 37.9% underscores efficiency in capital allocation, maximizing shareholder value and ensuring prudent use of financial resources.

Value Creation for Shareholders

HCLTech is committed to creating long-term value for shareholders through a balanced approach focused on delivering strong financial returns and sustainable growth. The company consistently achieves top quartile Total Shareholder Return (TSR), demonstrating its ability to outperform industry peers and translating operational success into financial benefits for investors. HCLTech has delivered the best-inclass compound TSR (15.1%) in the last 10 years.

HCLTech’s success in maintaining this stellar TSR performance can be attributed to a strategic blend of factors. First, the company’s relentless commitment to sustained growth, backed by a meticulous focus on profitability, has been a cornerstone of its operational strategy.

This commitment extends beyond mere financial metrics, encapsulating the company’s dedication to delivering value to its clients and staying at the forefront of technological innovation.

A key element of HCLTech’s shareholder strategy is its commitment to returning capital. The company has pledged to distribute a minimum of 75% of net income cumulatively from FY22 to FY26 through dividends, reinforcing its focus on delivering tangible returns to shareholders. This strategy enhances investor confidence and is aligned with HCLTech’s broader goals of maintaining financial stability and growth.

By balancing capital returns with strategic investments, HCLTech continues to drive long-term value creation, solidifying its reputation as a reliable partner in delivering sustained shareholder benefits.

As AI adoption grows, talent acquisition and development are becoming strategic priorities. We believe business value can be unlocked only at the intersection of human intelligence and AI. We are committed to upskilling and reskilling our workforce to stay future-ready. As AI, automation and digital transformation reshape industries, organizations are focusing on continuous learning and leadership development. Hybrid work environments, the growing importance of emotional intelligence in tech roles and the shift towards flexible, purpose-driven work models are trends that will redefine the workplace dynamics of the future.

Employee Health and Wellness

HCLTech champions employee wellbeing through comprehensive health benefits comprising annual check-ups, specialist consultations and life coaching, creating a supportive environment that enhances productivity. We also offer stress management programs and access to employee assistance programs (EAPs), empowering employees to maintain their mental health.

We provide enriching sessions, including yoga, pilates, meditation and workshops on work-life balance, promoting both physical and mental vigor. Our flagship ‘BE WELL’ program fosters resilience through activities like musical concerts, fitness challenges, therapeutic crafts and guided meditation, all led by certified professionals.

Fitness center in the Lucknow campus

Upskilling and Training

HCLTech is deeply invested in upskilling and re-skilling its people to keep itself future-ready. In FY25, almost 80% of our employees were trained in core skills, over 115,500 were trained in digital skills and over 116,200 people were trained in GenAI. More than 131,000 employees benefited from behavioral and leadership development courses while over 4,800 women employees benefited from our Women Career Development Program.

The MentorMe and Aspire platforms are designed to democratize learning and provide access to expert guidance. In FY25, over 4,600 additional people signed up as mentors and more than 9,000 mentoring meetings were organized, clocking over 61,000 mentoring hours. Our Future Bytes program offers learning opportunities to our workforce on new-age technologies, including AI, Big Data, Internet of Things and Cloud Computing, to help them remain future-ready.

HCLTech’s Certified People Manager Program equips people managers with an effective mindset, skillset and toolset to foster inclusive leadership and have meaningful, development-focused performance conversations with team members. In FY25, over 6,000 managers completed the foundation level, over 4,500 finished the intermediate level while over 4,400 managers accomplished the advanced level.

Ensuring diverse and inclusive workplaces

Our investment in advanced technologies enables us to develop solutions that address evolving business needs and unlock new opportunities. We partner with leading technology companies to form a robust ecosystem to help enterprises navigate business challenges more efficiently. We harness the power of cloud, GenAI, IoT, blockchain, DevOps, data science, edge computing and quantum computing, among others, to drive innovation and sustainable growth for our clients.

Responsible and Full-Stack AI Offering

We have built a unique, full-stack AI offering that spans the entire ecosystem — from chip design and data engineering to large language models and AI-powered applications. Our focus is on two key pivots: a) Driving time to acceleration and productivity through service transformation b) Driving business outcomes through value stream innovation. The key components of these two pivots are our four major AI offerings — AI Force for service transformation and AI Foundry, AI Labs and AI Engineering for value stream innovation.

These offerings have also enabled us to build industry-focused and horizontal-focused solutions and drive agentic AI capabilities. We also believe that AI and GenAI have to be built on the principle of trust and reflect our core values. HCLTech has established the Office of Responsible AI and Governance (ORAIG) to ensure that AI systems are developed and deployed ethically and responsibly.
For more details, visit the AI and GenAI section.

Innovations Across Businesses

Our Engineering and R&D Services (ERS) division remains at the forefront of innovation. ERS contributed over 1,000 patents over the last decade, working closely with G2000 companies. At the core of the AI strategy of ERS is a dual focus on leveraging AI to drive both value stream innovation and extensive service transformation across products, processes and assets. It achieves this by building powerful multimodal AI solutions that seamlessly leverage cutting-edge Vision AI, GenAI and Data Analytics to understand context across different types of sensory inputs to deliver tangible business outcomes.

Our Digital Business Services business helps build composable apps that adapt at market speed, unlock value from data for our clients and transform their operations for sustainable value creation. By embedding GenAI across every aspect of the value chain, we enable organizations to transition seamlessly into an Autonomous Enterprise, driving real-time innovation, efficiency and adaptability. With a focus on AI, industry-specific platforms and strategic partnerships, we deliver scalable, innovative solutions that create lasting, tangible value.

HCLTech’s Digital Foundation Services (DFS) is advancing platform-based Managed Services through focused R&D in AI, GenAI, automation, hybrid cloud, service management, cybersecurity and user experience. Our investments span Agentic AI, Cognitive Infrastructure, AI-powered Threat management, Digital Workplace and Network transformation solutions. These investments aim to transition customers from traditional IT operations to intelligent, autonomous and user-centric environments.

By co-innovating with ecosystem partners, DFS enables enterprises to modernize their IT infrastructure, transforming it into a resilient, reconfigurable and autonomous foundation for their digital transformation initiatives. This modernization results in a high user experience and engagement index. We empower customers to reconfigure their IT at the speed of business, improve resilience and enhance employee engagement. This drives agility, cost efficiency and long-term competitiveness in a rapidly changing digital landscape.

Our Digital Process Operations (DPO) division delivers Business AI that focuses on creating intelligent autonomous operations. It has full-stack AI accelerators, AI agents and end-to-end domain-intensive solutions powered by our digitalCOLLEAGUE (dC) platform.

Our AI accelerators include iKnow, an intelligent platform for continuous learning and assessment; iGenie, a humanoid multilingual text and voice agent; Exacto+, a patented deep data extraction and generation engine; Toscana+, a proprietary intelligent business process management and automation solution; OCC+, Operations Command Center for advanced analytics and insights and Agent Anywhere Customer Anywhere (AACA), a multilingual platform to enable customer service from any-shore.

Some of our AI-powered solutions developed for diverse sectors include Autonomous Accounts Payable, Zero Touch Order to Cash, Contract Lifecycle Management (CLM), Automated KYC-AML, Banking Chargeback Copilot and Healthcare Payor Claims Management. We also have over 50 preconfigured AI Agents that can be orchestrated in a multi-agent scenario along with human agents in a seamless operating model. They can learn, improve and perform a variety of tasks across enterprise functions, including automatic review of tender portals for qualified RFPs and creating proposals, mismatched product description resolution, cross/upsell opportunities based on customer buying pattern, automated order allocation, service chat and technical support, anomaly detection in documents, duplicate transactions identification and auto tax calculation, among others.

At HCLSoftware, a dedicated IP Management Council oversees its IP Management (IPM) program while innovation initiatives like HCL SPARC and HCL SYNC accelerate its technology leadership. HCL SPARC focuses on intellectual exploration, fostering collaboration among experts, engineers and scientists, to solve complex technological challenges and create cutting-edge software solutions with an aim to build a portfolio of new-gen products. A few areas in which the program helped create innovative solution include GenAI, SLMs, Copilot solutions and machine learning for operational intelligence.

HCL SYNC, launched in April 2024, functions as an open-innovation hub and a startup accelerator. Its primary role is to amplify the efforts of our internal R&D teams by immersing them in an environment ripe with fresh ideas and cutting-edge technologies from startups. FY25 initiatives included connects with deep-tech startups and our Unica and Commerce teams, resulting in multiple PoCs, such as multilingual audio-to-text conversion and sustainability tracking.

HCLSoftware delivered more than 130 product releases, including HCL UNO (Agentic AI), Unica+, AppScan 360 v1.4, BigFix Workspace+, BigFix Enterprise+ and HCL Zen 16. The HCLSoftware Marketplace and My HCLSoftware (MHS) platform support over 20 products, from trials to post-sales. Knowledge-sharing is promoted through Connect-to-Collaborate, the Product Manager Guild and HCLSoftware U — offering role-based, self-paced learning and certification to boost internal collaboration and capability.

Startup Accelerator

Our distinctive ecosystem unites startups, venture capitalists and trade missions globally. Through our startup accelerator and innovation initiative, Startup Ecosystem Innovation Platform and Program (eSTiP™), we facilitate the co-creation of technology solutions via an open innovation model. Governed by HCLTech’s Enterprise Technology Office, eSTiP™ operationalizes innovation and fosters extensive collaboration among diverse stakeholders. Employing a systematic and scalable approach to idea funnel management, prototyping, deployment and commercialization of these technology solutions, eSTiP™ helps accelerate the creation of innovative solutions that offer tangible benefits to clients. We have partnerships with Sydney Quantum Academy, the National University of Singapore and the University of Calcutta to help accelerate the development of the quantum technology ecosystem.

Intellectual Property

Effective intellectual capital management is critical to the continued success and growth of HCLTech. Whether we are working closely with our clients to translate their requirements into tangible solutions or creating our breakthrough products through targeted R&D investment and strategic partnership models, we transform knowledge into marketable and strategic assets. A total of 89 patents were filed and 65 granted during FY25.

HCLTech’s Value Creation Portal is a unique grassroots innovation platform that enables employees to contribute ideas and create value for its clients. In FY25, over 28,660 employees leveraged the platform, generating, reviewing and approving over 17,300 ideas and implementing more than 8,100 ideas that delivered customer signed-off value worth $1.6 billion.

Sustainable Solutions

HCLTech’s commitment to Green IT is evident in its efforts to minimize the environmental impact of its IT operations. The company prioritizes using energy-efficient hardware, implements virtualization and cloud computing to reduce physical infrastructure and adopts sustainable practices in data centers. HCLTech has developed innovative solutions like NIO, which leverages best-in-class advanced technologies and analytical engines to optimize energy consumption by any organization. Solutions such as the Track and Trace IoT for optimizing delivery routes and AR Remote Assist for facilitating remote site visits further reduce fuel consumption, greenhouse gas emissions and operational costs. Partnerships with AWS, Azure, SAP and niche sustainability players like Waterplan, GoCodeGreen and others enable us to design bespoke ESG solutions. With our CloudSMART approach, we help clients reimagine their cloud journey with a sustainability-first mindset. Through these initiatives, HCLTech reduces its own carbon footprint and helps clients achieve their sustainability goals, reinforcing its position as a leader in environmental responsibility and innovation.

Customer Experience Centers

New Jersey, US

Noida, India

HCLTech follows an inclusive approach to business and ensures it engages all key stakeholders, fosters trust and builds long-term relationships. Our approach of always being relevant to our clients and partners and positively impacting local communities wherever we operate reinforces HCLTech’s responsible business ethos.

Helping Clients Unlock Value

HCLTech drives digital transformation for its clients through its full-stack portfolio, with AI at the core. Our solutions unlock tangible business value, boosting efficiency, improving customer experiences and accelerating time-to-market. This helps global enterprises stay ahead of the curve in a digital-first world.

Engagement with Clients to Foster Growth and Innovation

HCLTech considers client engagement a strategic collaboration to meet client expectations and foster mutual growth. We have a dedicated Customer Advocacy Group (CAG) for building and enhancing customer relationships over their lifecycle.

Customer Advocacy Framework

It implements a comprehensive client feedback framework that captures and facilitates actionable client insights. The CAG also leads our Value Creation program, encouraging employees to propose operational and transformational ideas to exceed customer expectations.

CAG’s customer advocacy framework consists of projectlevel customer satisfaction surveys (PCSAT), accountlevel customer satisfaction surveys (ACSAT), Customer Relationship Improvement Solutioning Partnership (CRISP) to act on client feedback and improve the relationship and CREST, an initiative to enable a structured client cadence mechanism across all HCLTech engagements. Besides, we have a dedicated mobile app called Engage for engagement with clients.

Zack Kass (R), AI Futurist and Ex-Head of GTM at OpenAI, in conversation with C Vijayakumar, at WEF 2025

Our Leadership team at Investor Day 2024, Mumbai

To maximize our contribution towards the United Nations Sustainable Development Goals (SDGs), we have woven sustainability into our business strategy with three objectives in mind: to meet our own sustainability goals, help our clients achieve their sustainability goals and create a positive impact for all stakeholders. These objectives are underpinned by our three guiding principles:

Greenhouse Gases (GHG) Emissions

Through strategic initiatives and proactive measures, we are ahead of our planned emission reduction goals. We selected FY20 as our baseline for various metrics, ensuring data integrity and alignment with our Net Zero target for 2040. This approach, rooted in industry best practices and stakeholder engagement, drives continuous improvement in energy management and sustainability performance. Our GHG emissions calculations include a comprehensive range of all sources aligned to international standards, allowing us to accurately assess our environmental impact and develop targeted reduction strategies.

Scope 1, 2 and 3 emissions (MTCO2e)

Water Management

Through HCLFoundation, our initiatives have helped recharge more ground water in India. We have managed to recharge 31 times more water than we consume through our efforts. This gives us a better understanding of the scale of our initiatives.

Water consumption (in Kiloliters)

26.1B

Liters water harvested

115

Structures created for rainwater harvesting

115

Water bodies revitalized

We are the first company headquartered in India to join the Water Resilience Coalition and we endorse the CEO Water Mandate, a collaboration between the UN Global Compact (UNGC) and the Pacific Institute, aimed at promoting corporate water stewardship globally.

Energy Management

Our strategy on energy management is two-pronged, first to reduce our energy consumption through energy efficiency initiatives and then to source the energy from renewable sources. Our energy consumption has decreased by 29% in comparison to our baseline year of FY20, with a notable 23% reduction in non-renewable energy usage, signaling a strategic shift towards more sustainable energy sources. Our utilization of renewable energy during the same period has seen a 83% increase in renewable energy consumption (against baseline FY20).

Total energy consumption intensity GJ/Million INR

Waste Management

At HCLTech, we prioritize the 3Rs — Reduce, Recycle, Reuse — in our waste management program, meticulously measuring, categorizing and processing all waste generated. We also engaged an independent third party to conduct a detailed gap assessment study to improve our existing waste management process.

In FY25, we received TRUE Zero Waste to Landfill certification for all our campus facilities.

We also achieved 100% “Platinum” ratings for all our campus facilities from GBCI.

Expanding our environmental stewardship beyond our walls, we established a strategic partnership with the Greater Noida Industrial Development Authority. Through a Memorandum of Understanding (MoU), we are actively involved in the My Clean City program, dedicated to fostering a circular economy. This initiative aims to empower informal waste collectors, improve waste segregation and enhance recycling processes.

Plantation drive by HCLTechies