Cognizant is a global IT services company built around enterprise technology work that most large companies cannot easily turn off: applications, infrastructure, data, cloud, business processes, and industry platforms.
Cognizant operates a classic global IT services and consulting model. The company generates revenue by taking over the significant, complex IT operations of Fortune 500 companies (particularly in healthcare and banking). Profitability relies entirely on labor arbitrage: charging the American client high hourly rates in dollars, while executing the actual software development and maintenance using a, efficient workforce based primarily in Chennai, India. Cognizant operates a scalable global IT services and consulting model, generating revenue by providing complex systems integration, application maintenance, and digital transformation services to Fortune 500 corporations. The company's profitability is driven by the 'global delivery model'—an aggressive labor arbitrage strategy where Cognizant secures lucrative, high-billing contracts from clients in North America and Europe, but executes the actual software development and IT maintenance using a skilled, lower-cost engineering workforce located primarily in India. Because legacy IT services are becoming heavily commoditized Cognizant is transitioning its revenue base toward high-margin 'digital' services, including cloud migration, artificial intelligence implementation, and data analytics. The company utilizes an aggressive 'land and expand' strategy, embedding itself within a client's critical IT infrastructure with initial consulting projects, and then capturing multi-year recurring revenue contracts to manage the very systems they just modernized.