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TCS, Infy, Wipro may replace IT megavendors
By
siliconindia news bureau
Bangalore: Tata Consultancy Services, Infosys Technologies, and Wipro Technologies will emerge as the next generation of IT service mega-vendors.
A Gartner study says that these vendors, which are collectively referred to as 'India-3' and are increasingly being considered for strategic service deals, will perhaps replace today's mega-vendors by revenue - IBM Global Services, Accenture and EDS - in this space by 2011.
Though much smaller in size when compared to the current mega-vendors, these emerging mega-vendors are increasingly competing for the same mega-deals that had been the exclusive domain of the incumbent mega-vendors.
The 'India-3' have leveraged their strong success with meeting client needs to achieve record growth levels during a long period of time (30 quarters continuously) and have outperformed the incumbent mega-vendors by almost a 3:1 margin in growth rates.
The market capitalization of the Indian providers is significantly higher than that of EDS, and almost on par with Accenture that are much larger companies in terms of revenue. "The emerging mega-vendors have made dramatic progress in the past few years and have more than doubled their revenue in a four-year period, with the 2007 revenue being 2.6 times the 2004 revenue," says Partha Iyengar, VP and Regional Research Director, Gartner.
The emerging mega-vendors have leveraged four critical competencies to achieve their status as emerging mega-vendors. The competencies are: process excellence; world-class HR practices; providing high quality services at a low cost; the achievement of significant and disproportionate 'mind share' compared to their actual size.
However, as per the study, it is clear that there is a divide between today's mega-vendors and the aspiring Indian mega-vendors. The Indian providers will have to address the issue of moving away from resource-intensive revenue growth to a model that provides higher leverage and increases revenue without a linear relationship to head count, which is the situation that exists today.
"There are strong indicators that 'India-3' (TCS, Infosys and Wipro) will be the next mega-vendors in IT services. However, to achieve this, the current standing of the India-3 will need to expand quickly to keep pace with the changing client environment for IT delivery in the future," said Iyengar.
A Gartner study says that these vendors, which are collectively referred to as 'India-3' and are increasingly being considered for strategic service deals, will perhaps replace today's mega-vendors by revenue - IBM Global Services, Accenture and EDS - in this space by 2011.
Though much smaller in size when compared to the current mega-vendors, these emerging mega-vendors are increasingly competing for the same mega-deals that had been the exclusive domain of the incumbent mega-vendors.
The 'India-3' have leveraged their strong success with meeting client needs to achieve record growth levels during a long period of time (30 quarters continuously) and have outperformed the incumbent mega-vendors by almost a 3:1 margin in growth rates.
The market capitalization of the Indian providers is significantly higher than that of EDS, and almost on par with Accenture that are much larger companies in terms of revenue. "The emerging mega-vendors have made dramatic progress in the past few years and have more than doubled their revenue in a four-year period, with the 2007 revenue being 2.6 times the 2004 revenue," says Partha Iyengar, VP and Regional Research Director, Gartner.
The emerging mega-vendors have leveraged four critical competencies to achieve their status as emerging mega-vendors. The competencies are: process excellence; world-class HR practices; providing high quality services at a low cost; the achievement of significant and disproportionate 'mind share' compared to their actual size.
However, as per the study, it is clear that there is a divide between today's mega-vendors and the aspiring Indian mega-vendors. The Indian providers will have to address the issue of moving away from resource-intensive revenue growth to a model that provides higher leverage and increases revenue without a linear relationship to head count, which is the situation that exists today.
"There are strong indicators that 'India-3' (TCS, Infosys and Wipro) will be the next mega-vendors in IT services. However, to achieve this, the current standing of the India-3 will need to expand quickly to keep pace with the changing client environment for IT delivery in the future," said Iyengar.
Reader's comments(12)
1
past experience is not propotional to future expectations in the present Global
scenario
scenario
Posted by:
Viswanadh
2
In this entire thread there was no mention of compnies like Cognizant. In fact
Cognizant plays a major role in delivering per client expectations and also have
good and strong relationship with clients. Its just not only the so called
India3, thats a myth and there are many instances where they have lost major
deals because they where not able to live up to the clients expectation.
Cognizant plays a major role in delivering per client expectations and also have
good and strong relationship with clients. Its just not only the so called
India3, thats a myth and there are many instances where they have lost major
deals because they where not able to live up to the clients expectation.
Posted by:
Arjun
3
Merging of TCS-wipro-infy may form india-3 but to make it as gartner its
stupidity.As the main factor of growth is the employee/HR policy and reliability
in which these three companies are lacking.If they have a god employee policy
there may not be the iteration /lay off .it may be very less.
to be the best you should have the best attitude and approcs and to be a leader
you should have the experience.tcs wipro and infy sound good in india not
worlwide.
most of the projects in tcs/wipro are rolling back due to lake of skilled
employee as they leving in middle and the project rolled back to other
company.
so a leader mnever miss a single chance to win but i never find the attitude in
tcs /wipro/infy.
so it india-3 may can be a world leader if they will change their Hr policy and
increase the reliability by providing the end-to-end solution parellely .
stupidity.As the main factor of growth is the employee/HR policy and reliability
in which these three companies are lacking.If they have a god employee policy
there may not be the iteration /lay off .it may be very less.
to be the best you should have the best attitude and approcs and to be a leader
you should have the experience.tcs wipro and infy sound good in india not
worlwide.
most of the projects in tcs/wipro are rolling back due to lake of skilled
employee as they leving in middle and the project rolled back to other
company.
so a leader mnever miss a single chance to win but i never find the attitude in
tcs /wipro/infy.
so it india-3 may can be a world leader if they will change their Hr policy and
increase the reliability by providing the end-to-end solution parellely .
Posted by:
Hariprasad
4
Its a far cry for India-3 companies to come even near IBM, Accenture,EDS - an
that too by 2011 as Gartner mentions. These MNCs have the capability to provide
end-to-end solution in terms of Software, Hardware, and Services. Whereas the
India-3 can claim strongly on software development & maintenence - which forms
only 50% of the end-to-end solutioning. Definitely it will not be by 2011 or
many years thereafter maybe.
that too by 2011 as Gartner mentions. These MNCs have the capability to provide
end-to-end solution in terms of Software, Hardware, and Services. Whereas the
India-3 can claim strongly on software development & maintenence - which forms
only 50% of the end-to-end solutioning. Definitely it will not be by 2011 or
many years thereafter maybe.
Posted by:
Ashish Roy
5
Whether the next generation of IT leaders happen to be "based" in India or the
US or elsewhere is largely irrelevant to this discussion. If companies like TCS
and Infosys are to become global leaders, they will have a global presence, a
global employee base, and world-class leadership that will be drawn from around
the world. When that happens, they will cease to be "Indian" companies and turn
into multinational companies. Similarly, IBM's success is in large part due to
its multinational workforce.
US or elsewhere is largely irrelevant to this discussion. If companies like TCS
and Infosys are to become global leaders, they will have a global presence, a
global employee base, and world-class leadership that will be drawn from around
the world. When that happens, they will cease to be "Indian" companies and turn
into multinational companies. Similarly, IBM's success is in large part due to
its multinational workforce.
Posted by:
Namita
6
I truely hope that vendors in India and other "third" world countries are able
to compete with "multinationals" - that's progress for humanity.
However it is not easy.
Quoting recent business magazines - IBM is fast aproaching leadership position
for the Indian market in revenue and perhaps in employee strength. Also, in this
economic scenario IBM's stock prices have maintained an up-tick while TCS was on
the decline. When the Indian companies become multi-nationals (there certainly
exists signs of it) some of them will certainly be like IBM.
We should certainly hope for the best.
to compete with "multinationals" - that's progress for humanity.
However it is not easy.
Quoting recent business magazines - IBM is fast aproaching leadership position
for the Indian market in revenue and perhaps in employee strength. Also, in this
economic scenario IBM's stock prices have maintained an up-tick while TCS was on
the decline. When the Indian companies become multi-nationals (there certainly
exists signs of it) some of them will certainly be like IBM.
We should certainly hope for the best.
Posted by:
Debashish
7
Watch out for IBM too...IBM is taking a completely different route that none of
the companies can ever get into - Consulting, Software, Hardware, Mainframes
(which are again coming back big time with SOA). In a short time, you might see
IBM throwing away Software and Hardware along with consulting. IBM is also
aggressively getting into Indian and Chinese market.
the companies can ever get into - Consulting, Software, Hardware, Mainframes
(which are again coming back big time with SOA). In a short time, you might see
IBM throwing away Software and Hardware along with consulting. IBM is also
aggressively getting into Indian and Chinese market.
Posted by:
Kumar
8
Well, India-3 can reach mega vendors status...but the question is how long they
would retain that position? I doubt on this aspect. the report is both
heartening and praising the work of the indian IT services companies. How long
does it take for the IBMs or Accenture to take the same indians and do the work
from offshore. They already started it.
Also very few companies like IBM, have metamorphised mutliple times and emerged
as the winner as the environment changed. None of the indian companies have this
experience. They all are like the new rich guys in the block.
would retain that position? I doubt on this aspect. the report is both
heartening and praising the work of the indian IT services companies. How long
does it take for the IBMs or Accenture to take the same indians and do the work
from offshore. They already started it.
Also very few companies like IBM, have metamorphised mutliple times and emerged
as the winner as the environment changed. None of the indian companies have this
experience. They all are like the new rich guys in the block.
Posted by:
STA
9
It would be Stupid ,rather a loose talk from Gartner to even Dream that Indian
based MNC's can give a run for their money to mega vendor's.....
Clients can feel that and the deep corner of an Employee's heart of these
MNC's can speak more volume.
based MNC's can give a run for their money to mega vendor's.....
Clients can feel that and the deep corner of an Employee's heart of these
MNC's can speak more volume.
Posted by:
Ameen
10
I dont think that companies like TCS can ever reach and compare to the global
leaders, since TCS lacks the basic characteristics of a leadership company. A
company with dissatisfied and disgruntled employees can never make it big. Its
top management are also hopping companies at the drop of an opportunity. Unless
the filthy HR and resource policy of the company is improved, there is no
'bright' future for this company.
leaders, since TCS lacks the basic characteristics of a leadership company. A
company with dissatisfied and disgruntled employees can never make it big. Its
top management are also hopping companies at the drop of an opportunity. Unless
the filthy HR and resource policy of the company is improved, there is no
'bright' future for this company.
Posted by:
TCSer
11
But nobody can make a prediction based on the past growth situation. The reach
and potential of global players cannot be taken for granted.
and potential of global players cannot be taken for granted.
Posted by:
Murukan
12
for a long time IBM, Accenture and EDS have taken up this role, lets wait to see
if Gartner's prediction becomes the real future.
if Gartner's prediction becomes the real future.
Posted by:
Julia
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