In June 2019, Hexaware announced its acquisition of design and technology services firm Mobiquity for a cool $182 million. A couple of months on we wanted to see how this has played out. Is it just more consolidation in the IT services market? Or an exciting investment for Hexaware? One that adds greater design capability alongside depth in AWS cloud solutions?
As a leading firm in the customer experience space, Mobiquity brings depth in digital design
Hexaware has a clear strategy—automate everything, cloudify everything, transform customer experience. While the firm has been able to demonstrate capability in automation and cloud, the customer experience piece has been missing a key ingredient: talent. Of course, this isn’t a challenge reserved for Hexaware; across the mid-tier and upper-tier IT services firms, we have seen a real battle to bring in digital and design talent to support lofty ambitions outside of traditional IT. Some firms have found it easier than others. Wipro’s acquisition of DesignIT had a bumpy start, but it seems to be delivering results now, and it’s almost impossible for firms to keep up with Accenture’s voracious appetite for design boutiques.
But with Mobiquity, Hexaware has found a hidden gem. Mobiquity boasts a range of impactful case studies and examples of its work—from leveraging Amazon Alexa to transform experiences for International Hotel Group to supporting telcos in re-platforming their IT infrastructure to support new forms of payment and delivery. Unlike other design firm acquisitions we’ve seen in the space, Mobiquity also has a few other weapons in its arsenal that Hexaware and its clients will find uniquely helpful.
As an asset-light cloud broker, Mobiquity’s partnership with AWS is a valuable asset
Let’s dig into Mobiquity’s relationship with the cloud. Until this point, Hexaware had only announced a partnership with Microsoft Azure to help support the firm’s ambitions to cloudify client environments. With Mobiquity on board, the firm now has access to not only a strong partnership with AWS—the fastest growing of the hyperscale firms—but it can also tap into the essential talent that Mobiquity has developed over the years. In a world where partnerships come cheap, particularly in the cloud space, it’s the talent that comes with it that makes this acquisition highly valuable to a major tenet of Hexaware’s strategy.
When digging through case studies, it becomes clear that Mobiquity has developed a strong capability across Amazon’s technology stack, which increasingly focuses on digital enablement and has technologies that are becoming a core part of CX strategies—fueled by the clamor for services and products in the consumer space. In practice, this means Hexaware’s clients now have additional cloud capabilities available when partnering with the firm to transform their infrastructure.
Unlike product or asset focused acquisitions, buying design agencies is all about keeping talent – Hexaware and clients should keep an eye on attrition
Retaining talent post-acquisition is often the biggest challenge. The value with this acquisition, as with many in the services space, is the talented professionals that deliver services. But all too often, an acquisition announcement signals the start of a wave of departures. Increasingly, the largest IT services firms have matured their approach to talent-focused acquisitions, which differ from traditional targets where the value is placed on a product, by taking a back seat and leaving leadership structures intact.
Hexaware seems to be following this approach. When the acquisition was announced, leadership teams from both Hexaware and Mobiquity advised that team structures and ways of working would remain unchanged. An encouraging strategy for clients, who must keep an eye on attrition as much as provider leadership teams if they are to realize the most value from the acquisition.
The Bottom Line: Mobiquity brings considerable digital and design capabilities to Hexaware’s current and future clients. And if managed correctly could push the firm onto digital design shortlists
Nevertheless, in any acquisition, there needs to be a process of integration as both parties find synergies to exploit and areas of duplication to rationalize. The trick here will be managing that process carefully to ensure the value of Mobiquity’s talent and capabilities are maintained as much as possible. As the capabilities from both firms develop, enterprise leaders must keep tabs on progress to measure whether Hexaware now has the boosted delivery strength to move into engagements that it otherwise wouldn’t have made the shortlist for.
Ultimately, there are clear benefits for clients from the tie-up that can be leveraged in existing and future engagements, as Sandeep Dhar, President, Customer Experience Transformation (CXT) Business, Hexaware Technologies highlighted “Over the years, Mobiquity, Inc. has established a benchmark in defining omnichannel digital experiences and next-gen user interfaces such as smart speakers and digital assistants. Their methodology combines consulting, design, and deep engineering capabilities that leverage the cloud. At Hexaware, we have been building capabilities in digital engineering, marketing and content platforms, e-commerce, and CRM. Together we will now offer a comprehensive suite of digital solutions enabling superlative customer experiences.”