Breaking Barriers

The growth of 22 % was not exactly spectacular, but not a bad show either.
While factors like rupee appreciation and the US slowdown in the last quarter
did become tactical challenges, the sluggish growth in India revenue, in a year
most domestic services companies have registered very strong growth, points to a
missed opportunity.

TCS focused too much on very large deals, that too primarily in the
government sector. Competitors Wipro and IBM, on the other hand, targeted
enterprise and SMB as well and were rewarded with strong growth.

But the star domestic play was its strong entry into domestic BPO. It made as
much as Rs 500 crore from it, again a lot of it contributed by large deals such
as the end-to-end passport processing. In fact, in a market where there is very
little organized outsourcing beyond call centers, this was a market-making move.

The global story, discounting the usual industry challenges, was good. A 26%
growth (excluding BPO) in an uncertain year was robust. Moreover, what was
noteworthy is that TCS finally proved that an Indian company could bag a billion
dollar deal with its $1.2 bn contract from Nielsen, the largest in Indian
offshoring history.

Rank-1

l Start-up Year: 1968
l Products & Services: Software
services, IT consulting, and BPO

l Branches: 245
l Employees: 110,061
l Address: TCS House, Raveline Street, 21 DS Marg, Fort,
Mumbai-400001 l Tel: +91-022-6778
9999 l Fax: +91-022-67789000
l Website:
www.tcs.com

size=1>Highlights

n
 Bagged a $1.2 bn
deal from Nielsen, the biggest ever outsourcing deal by
any Indian company

n Became
the largest employer in India in the private sector

n Opened
a subsidiary in South Africa to tap the African market,
with focus on governments

size=1>Strengths

p
Is the only big
non-American company that is seen as a truly global
company


p Manages
employees very well, despite scalea strategic advantage
inIndia

size=1>Weaknesses

size=1>q Not much
reach in India beyond government sector

size=1>q Consulting
yet to mature

S
Ramadorai, CEO & MD

N
Chandrasekaran, COO & executive director

S Mahalingam, CFO & executive director

Ajoyendra Mukherjee, VP & head, Global HR

Phiroz Vandrevala, executive director & head, Global
Corporate Affairs

TCS has the most robust global business. In terms of delivery, it
is the most global. In terms of market penetration, no other
offshore firm comes close to it. Beyond North America and Europe,
TCS grew in Latin America, drawing 4.4% revenue from there, up from
3.8% a year earlier (even more if you include BPO). In the emerging
and new markets, such as Africa, TCS wants to target the governance
sector, based on its learning from India. That made it form a
subsidiary in South Africa, with equity participation from the Black
Economic Empowerment Group, a developmental group.

On the organizational side, it crossed the 1 lakh employee mark and emerged
as Indias largest private sector employer.

If TCS has to compete with IBM effectively, it could do with a few more MCA/BSNL
like deals, but what it really needs is a few more Nielsen like dealsin India.