Nitin Shah, Chairman & Managing Director, Allied Digital Group, Mumbai

15th Sep 2008
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Making every byte count

The best things in life don't come planned - rather they 'happen' to you. Nitin Shah was all too happy with a top position, fat pay package and perks with one of the top companies of his time and yet eventually he ventured out with a true entrepreneurial spirit. Hailed by media as 'The man who has done IT all', he went out on his own to create Allied Digital Group, an end-to-end IT solution company. In conversation with Your Story, he shares his journey from Mainframe era of 80's to today's MMS.

My story

I graduated from VJTI in 1977 with a BE in Electrical Engineering and then went on to complete my post graduation in

Management from the Jamnalal Bajaj Institute. Technology was game of only the biggies at that time. The current technological sophistication and its omnipresence was unimaginable back then. Coming from a strong Gujarati business background, I decided to chance away from the family trading business and set forth into the newer domain of technology.

I worked on huge industrial mainframe computers back then - and absolutely no one I knew had a clue of what I did. I joined CMC after graduation and then later Hinditron where I was the senior most technical consultant on board. There had been a vacuum in the market after IBM left India due to the political situation of the time. IBM had dominated the market space and had been the main provider of mainframe computers and services to all top companies of the time from the Mafatlals to... you name it.As other companies tried to fill this vacuum, large enterprise clients were losing crores of rupees each day in critical operations. There were a very small handful of engineers like us back then who could work on such systems.

Finally, I was posted with the huge Mafatlal Consultancy Services. It was at this point that I met with R. H. Bengali, a senior executive in Mafatlal, who watched me and was impressed by my technical knowledge and the perseverance I demonstrated for every problem that was brought to me at any hour of the day or night. He encouraged me to start-up my own business.

At first, I resisted as I was happy working with CMC and leaving the security of this high profile white collar job didn't seem very sensible those days.However, I took the plunge in 1984 and started a company called Digital Data Services with a one table office in Fort - paying Rs250 per month for it. My clients consisted of companies such as Forbes Group, Pfizer, Bombay Dyeing, Indian Navy, LIC, and Deutsche bank for whom I acted as a technical consultant. I was now earning more than ten times what I earned in my job. Yet other experienced and skilled help was hard to come by and I had to train many people myself. Another difficulty faced was the huge vendor dependency. There was a very low availability of spares. One absolutely had to resolve the problem instead of simply getting replacements - right up to the component level.

This was the case until the first PC came into the Indian Market in 1986. As a consultant to all the top companies, I got the opportunity to work on the PC firsthand and then IBM sold the technology patent. I quickly realized that there would be an emerging need for networking at this time and thus, instead of investing in production of PCs I went ahead in the services chain. Digital Data offered peer to peer networking solutions at a time when computers had just entered the market. In no time, computers were flooding the market and I was among the few that provided such services and solutions. When Intel entered the market, they identified me to chair on their core team and participate in the development of a technical syllabus.

With the opening of the Indian economy in 1991, we established ourselves as a company offering many technological solutions under one roof. Soon DELL approached us to partner them in their India operations. Allied Digital since then has gone on to partner with the top names like DuPont, World Bank, Deutsche Bank, Nestle, Oracle, Boeing, etc. Allied Digital always had a direct approach in all its dealings which was appreciated by all. To ensure that the best and most direct services are organized for its customers, Allied Digital started investing in its long term plans for developing an extensive network of direct offices across the length and breadth of the company.

While I consider myself lucky in this entrepreneurial journey, I have had testing times, such as the one in August 2004, when the company was growing very rapidly and yet the company was not able to meet the employees' payday. I had over 350 employees and families that were dependent on me. On taking a deeper look at the balances and accounts, we realized that the company was making profits but there was a serious problem in liquidity because of a large list of top clients with pending payments running as late as over a year. In business delays in payment from a customer are accepted but any delays in dispatching employees' salaries is absolutely unacceptable. This was a serious failure of collection yet when I realized again that concentrating on product selling was not going to work. I decided to re-look into our model and work out a more innovative blend of services to balance it out.

 

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