An outsourcing firm rocks social media

May 13, 2011, 9:00 AM UTC

Cognizant Technology Solutions, a tech outsourcing and consulting firm that serves huge companies, has built a corporate version of Facebook that pulls together a bunch of Web 2.0 tools such as Twitter feeds, employee-written blogs, and chat. It’s the kind of collaboration tool many businesses say they’d love to have. But Cognizant isn’t peddling the product to clients; the company instead uses its homegrown social-networking platform, Cognizant 2.0, to share ideas and communicate internally — and it gives customers access to the site so that they can post queries or search blogs and read tweets (called “Cweets”) for answers to frequently asked questions.

Such high-tech customer service helps explain why Cognizant (CTSH), based in Teaneck, N.J., has been growing like crazy. The company, a regular on Fortune’s annual Fastest-Growing Companies list, this year makes its debut on the Fortune 500, arriving at No. 484 with $4.6 billion in 2010 revenue, up a staggering 40% from a year earlier.

With 70% of its 104,000 employees in India, Cognizant is often lumped in with Indian outsourcing companies such as TCS, Infosys (INFY), and Wipro (WIT). But thanks to its strength in key industries — financial services and health care — and a push into high-end services such as systems integration and sophisticated data analysis for customers, Cognizant increasingly is compared to the giants of information technology. “In the past the Indian service firms were primarily stealing share from in-house IT staffs,” says Bernstein analyst Rod Bourgeois. “Cognizant is now competing head-to-head with IBM (IBM) and Accenture (ACN).”

CEO Frank D’Souza says initiatives such as Cognizant 2.0, or C2, give the company an edge as it competes with the big guys. Not only has the platform helped employees and customers communicate, it has injected Cognizant with social-networking smarts that will ultimately help it advise clients on their social and mobile strategies. “It’s been a tremendously powerful asset for us,” he says.

Helen Cousins, chief information officer at Lincoln Trust, a retirement-plan manager, says C2 automatically sends her blog posts related to questions she’s posted. Others like C2 so much they’ve asked to use it for internal collaboration. Cognizant says it has no plans to sell it as a separate product but will sometimes let existing clients use C2 as part of their contract — they probably just need to send D’Souza a Cweet.