TCS diversifying client base, pursuing new biz model

Last Updated: Monday, November 16, 2009 - 23:41

London: India`s largest software services exporter Tata Consultancy Services is aiming to move beyond its traditional Western market to serve new transnational companies in the emerging markets to become a truly global company.

"We want to become global not just in terms of sales but
from a people perspective," TCS head Natarajan Chandrasekaran
told the Financial Times in an interview.

Multinationals in emerging markets now account for about
one-fifth of the company`s sales. TCS has operations in about
42 countries and about nine per cent of its workforce is
foreign. At present it contributes nearly 10 per cent of
the revenue of the Tata conglomerate.

Besides diversifying its client base, TCS is pursuing an
"integrated full service" business model to garner higher
revenue.

Under this model, TCS would design, develop and manage a
given client`s software as well as maintain its hardware
systems and handle its business processes.

After years of double-digit - sometimes even triple-digit
- growth, India` outsourcing companies got battered pursuant
to the global economic slowdown as their largest clients, the
global financial services groups, faltered under the pressure.

Accordingly, TCS` Chandrasekaran told FT that the company
has to restore growth first as the past six quarters were
challenging as revenue grew just seven per cent for the year
ended March, down more than 30 per cent previously.

However, Chandrasekaran was optimistic about a recovery
and said that whether the global recovery is "V-shaped,
W-shaped or `square root`-shaped", clients will look to the
offshore outsourcing industry to cut costs.

The Indian Information Technology industry including --
TCS and its peers such as Infosys Technologies and Wipro --
played a major part in "the country`s transformation from
ox-cart economy to fast-growing, sophisticated Asian giant."

The IT industry generated USD 47 billion in exports in
the fiscal year ending in March and claims it has created
nearly half of India`s urban jobs directly and indirectly.

Bureau Report



First Published: Monday, November 16, 2009 - 23:41
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