IT Outsourcing India

Indias top three outsourcing majors, Tata Consultancy Services TCS, Infosys and Wipro, will gain enough muscle to take on todays IT giants like IBM, Accenture and EDS by 2011, IT research company Gartner said. These vendors are increasingly being considered for strategic service deals, and will augment or, in some cases, replace todays acknowledged mega vendors by revenue IBM Global Services, Accenture and EDS in this space by 2011, predicts Gartner. The IT research firm has based its projection on a comparison of growth rates of Indian firms and MNCs.

While the Indian companies have been registering growth of over 3040 percent in the last few years, their foreign rivals are growing at a much lower rate of around 5 to 10 percent. Even the market capitalisations of Indian tech majors were catching up their overseas competitors.

The emerging mega vendors TCS, Infosys and Wipro have made dramatic progress in the past few years and have more than doubled their revenue in a fouryear period, with the 2007 revenue being 2.6 times the 2004 revenue, said Partha Iyengar, vice president, analyst and regional research director, Gartner.

He said, This level of growth differential has continued even as these vendors have become multibillion dollar enterprises. To put this in context, there are just 100 service enterprises globally with more than  USD1 billion in revenue.

However, Iyenger said that Indian software exporters would have to overcome a few challenges before they become serious threats for the MNCs.

Looking at the revenue per employee data, it is clear that there is a divide between todays megavendors and the aspiring Indian megavendors, said the Gartner statement.

The research firm said the Indian service providers would be able to address the issue by moving away from resourceintensive revenue growth to a model that provides higher leverage and increases revenue without a linear relationship to head count.

They will have to achieve similar to the current megavendors levels of revenue per employee benchmarks to truly achieve megavendor status, said Gartner.

In 2007, revenue per employee of IBM, Accenture and EDS was  USD146,910,  USD130,200 and  USD154,340 respectively. That was much higher than the revenue per employee of TCS at  USD51,320, Infosys  USD45,800 and Wipros,  USD41,310 in the same year.

James Abraham director, The Boston Consulting Group, said, to him revenue per employee was not of much concern.

What the Indian IT players really need to work on is building more global delivery centres across the globe, and these centres should have as much scale as their MNC rivals, said Abraham.

Source : http://www.offshoringtimes.com/ 

Pressure mounts at giant Infosys campus

Saritha Rai visits Infosys’s giant Mysore training centre to gauge how outsourcers are using education to maintain their edge in challenging economic times.

Just before nine o’clock every morning, thousands of twenty-somethings stream across an expansive landscaped campus - past the Domino’s Pizza, the 24x7 library, the official merchandise store - and into large classrooms. A hundred or so file into one room, firing up their computers as their lecturer clips on his microphone and gets started on a two-hour session about Java technologies.

This could be a university classroom anywhere in the world but it isn’t. It is the sprawling training centre of India’s second-largest outsourcing company, Infosys Technologies, which boasts $4.6bn in revenues and 104,000 employees, at last count.

The 336-acre expanse, with its capacity to train 14,000 people, is likely to be the largest dedicated corporate training centre in the world. Even global outsourcing rivals would find it hard to replicate this scale in other offshore centres like Ireland, Russia or Vietnam.

But despite its grandeur, the campus has not been able to insulate itself from the effects of the global recession.

Given Infosys’s extensive hiring - peaking to 10,000 or more new hires during some quarters - it has no option but to take on fresh university graduates. And the chosen ones are not handed an appointment letter and herded to their work desks. Instead, they are bussed off to the training campus in Mysore, a three-hour drive from Infosys’ headquarters in Bangalore.

Infosys executives say intensive employee training gives the company an edge over its rivals. "It helps us meet and exceed customer expectations while maintaining our competitive edge," says Mohandas Pai, director of human resources at Infosys. "When a global customer is experiencing different suppliers, our employees come out differently," adds Girish Vaidya, senior vice president and head of the Infosys Leadership Institute.

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