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Rank 5: IBM India: Services as Savior

author-image
DQI Bureau
New Update

Abraham Thomas
Managing Director

Uday Shukla



Director, IGS

Dr Manoj Kumar



Director, IRL

Country Managers



M Ganesh




Enterprise Server Group


Ashish Kumar


IBM Global Services


Alok Ohrie


Personal Computing Division


Frank Luksic


Country Executive,


Software Group and Developer Relations






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When the fight gets tough, the tough sometimes walk away. And these

are tough times. IBM India’s systems’ revenues declined 10% last year, after

36% growth. The 7% overall growth had one reason: services. With margins that

helped it ‘walk away from deals when vendors discounted to an extent that no

longer made sense’. Competitors say IBM was hardly visible. IBM says it’s

about positioning. "Customers remember prices…if we quote X minus ten

now, will they easily agree to X when things look up?"

Performance

Highlights
Services grew, systems declined
Strong gains in banking
Class B/C cities thrust
Expended to new offices in Bangalore, Mumbai, Calcutta, Chennai
Strengths
Extensive, though complex, channel network
Powerful enterprise systems brand equity
Weaknesses
Not seen as aggressive/responsive enough in enterprise segment
Not present in fast-growing telecom space
IBM India Ltd. l

Startup: 1992
l

Products & services: Sales and marketing of IBM servers, PCs and software products and services

(SI Consulting, ITES, Software Developments
l

Branches:14
l

Address: No. 12 Subramanya Arcade, Bannerghatta Road, Bangalore 560 029

l

Tel: 2063000
l

Fax: 2063871
l

Website: ibm.com/in

IBM India and IBM Global Services (IGS) work closely

together, one backing the other’s systems sales with services. IGS also takes

up SI and other areas like outsourcing–for Tisco, Ballarpur, et al. It

absorbed 46 IT staff from ABB this year: in a five-year outsourcing contract, 50

IBMers now make up ABB’s IT arm in India.

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But over 40% of IBM’s pie is exports. IGS tops the ‘DQ 20

MNC Software Exporters’ list. (Local software sales, mostly Websphere and DB2,

added up to a byte over Rs 50 crore.)

All this gave IBM funds to spend on marcom, and on spanking

new offices in Bangalore, Mumbai, Chennai and Kolkata. A big push saw channel

sales up over 20%, through its many distributors. Its top ‘vertical’:

banking, again, partnering with iFlex, and now Infosys. Big deals included a

core banking solution for 200 branches of Syndicate Bank. Its only big losses:

PNB, and South Indian Bank, both to Sun.

Next came manufacturing, including the auto sector. Then, the government and

public sector, often through SIs: CMC, TCS, CMS, and now Wipro, which has good

inroads in oil and other PSUs. The gap was telecom, where apps mostly run on Sun

hardware, though a year-old Telco group in IBM is now pushing Intel-based

solutions. The drive ahead is uphill, but clear. Recover lost ground in systems,

taking on the new HP, and Sun (with HCL). And grow domestic services, now 26% of

the Rs 1,045 cr domestic pie, versus the worldwide 40% of ($86 billion). And

hold on to its Top 5 position.

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