Software and IT Services in India

Software and IT Services in India

            
 
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Case Details:

Case Code : BREP009
Case Length : 15 Pages
Period : 1998-2004
Pub Date : 2004
Teaching Note :Not Available
Organization : -
Industry : Software and IT Services
Countries : India

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Introduction Contd...

In the mid and late 1990s, the telecommunication infrastructure in India was strengthened, coupled with the decreasing telecom costs. Off-shoring became very economical for foreign companies. With this, more and more foreign companies started depending on India for services including installation of software packages (eg. SAP), offering IT consulting and carrying out R&D to develop new products.

Several major Indian software companies like Infosys, Wipro and TCS started offering IT consulting to cash in on the experience gained over the years in the industry. Along with this, the companies also started offering specialized services such as architectural design.

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A few Indian players were also concentrating on setting up state-of-the art, front- end consultancy firms in the West. Commenting on the emergence of Indian IT companies on a global platform, Jayant Sinha, a partner in the Delhi office of the strategic-consulting firm, McKinsey & Company, said, "It happened in a stealthy fashion.

For a long time, the likes of IBM, Accenture and EDS ignored the Indian IT-services companies as simply capturing the labour arbitrage between India and the West.

They took their eye off the ball, and when they looked up, the Indian companies were suddenly right behind them.

These [Indian] companies are really starting to inflict some hurt on the global multinationals."4

Notwithstanding the optimism, a few analysts felt that the Indian companies still had a long way to go to meet the strength of IBM in IT services, including consultancy (Refer Exhibit I).

The significant growth in revenues earned by Business Process Outsourcing (BPO) services in the past couple of years resulted in the emergence of several small and medium companies in India. Moreover, several large companies like TCS and Satyam started offering BPO services to cash in on the boom...

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4] Justin Wood, "The View from the East," www.cfo.com, June 01, 2004.

 

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