Zoho Beyond The Bustling City

The decade gone by has seen Mathalamparai, a quiet village in Tenkasi district of Tamil Nadu, evolve into a centre of rural excellence. The villagers do not have to migrate to the cities for work. They can stay close to their families and earn well, in turn supporting the overall growth of the village economy. The credit goes to an entrepreneur who believes that world-class products can be built anywhere.

Back in 2011, Sridhar Vembu, CEO of Indian multinational technology company Zoho, along with a six-member team, gave wings to his long-held dream by opening the company’s first rural centre in Tenkasi. Today, the office has 750 employees, with close to 600 coming from the district itself. According to Chennai-based consulting firm Economix Consulting Group, the centre has not only helped the local tech talent, it has had a trickle-down effect over the entire economy of the area. For example, it claims, women are able to spend more on themselves and spending on education and healthcare has improved. Vembu points out that auto-rickshaw drivers in the area have seen their income double as they have a lot more customers now.

“For every job that we bring, there is 10-fold multiplier effect in the area,” says Vembu with a sense of achievement. “It is something we want to replicate in our other rural centres as well. But we are cautious that we do not end up making Tenkasi into a giant metropolis. So, we have to grow it, but not so much that the entire idea behind these rural centres fails,” he adds.

Thinking Globally, Acting Locally

Over the past one year, Zoho has intensified its rural revival initiatives by opening about 20 satellite offices in rural and non-urban areas around the world and in India. The India offices, which started to cater to the employees who wanted to continue working from their hometowns during the pandemic, are located in Tamil Nadu, Kerala and Andhra Pradesh. These centres, though in the early stages, are expected to be fully developed in the next five to 10 years. The company plans to open 100 such new offices around the world.

Vembu knew that the organisation needed precise planning with goals-driven approach to make these centres a success while realising that neither such planning nor its execution was easy. “When we started building the Tenkasi centre, people were concerned whether such an idea would be sustainable in the long term. Today, we have all the arms of an organisation built into the centre as well, from design to technology to sales/marketing,” he says.

Vembu likes to cultivate talent. Though he focuses on building a business that is profitable, he wants his employees to have peace of mind. “You can only get so far by raking in revenue numbers, shelling out dollars on ads or projecting your brand on the tallest skyscraper in the world. For us, our goals and philosophy go beyond short-term and flashy gains,” he says.

Beyond “flashy gains” lies his social philosophy of integrated development of these non-urban centres. For example, the Tenkasi centre has a division of Zoho Schools of Learning, a programme through which students who complete Class XII or a diploma course are trained and hired as employees. Zoho has helped revamp infrastructure of local schools in Tenkasi, improve sanitation and hygiene through waste clearance and undertake pond desilting and other development initiatives. It also runs an agricultural farm in Tenkasi, which provides livelihood to field workers.

Harnessing Demography

Vembu wants to practise transnational localism. He wants to build several Tenkasis across the globe. The approach, however, in each of the country is likely to be different. “In India, for example, we open rural centres because they are demographically rich. But, say, in a country like Japan where the rural areas are thoroughly depopulated, we cannot hope to find talent in that region. We have to attract talent there with our facilities and the quaintness of the place. Kawane, where we have a rural centre, has a population of 6,000 people and just 20 children were born last year.”

Poor demography is also a challenge in the UK and the US. Mexico is better off in terms of demography. Zoho has set up two rural centres there. “There is a beautiful town called Kilitoro in Mexico, an hour-and-a-half drive away from the Mexico City, where we have a significant set-up of about 100 people. In Texas, where we already had an office in Austin, we recently opened an office in a small town called Maccalo at the Mexican border which definitely would not be on the radar of major tech companies. There, the approach is similar to India’s, but the Hispanic culture is different. We have to manage that,” Vembu says. These centres have been designed around the Tenkasi model.

Back home, Vembu wants to now look at the north and set up centres in Bihar and eastern Uttar Pradesh. The reason is the changing demography of the country. While India’s total fertility rate, which indicates the number of children born to a woman, is currently at the replacement level of two—the number needed to replace the parents—it is not uniform across states. A majority of the states have a lower fertility rate, with just a handful of them still above the replacement level. “That is another reason why I want to go to eastern Uttar Pradesh, because that is where [more] children are taking birth. We have to go to places where the talent will come from. Culturally, if we are ready for it, then we can have an unfair advantage in the global markets.”

Rural capacity building, according to Vembu, will promote transnational localism, which in turn will not only help companies tap into local talent pool but also allow people to realise dreams while staying closer home.