Big clients to desert Satyam
By
siliconindia news bureau
New Delhi: Satyam Computer Services' wound is getting more septic by the day. In a latest development, the company's major clients such as General Electric (GE), Nestle and British Petroleum, have started deliberating on moving work to other outsourcing vendors, reports The Economic Times.
GE is learnt to be weighing the options of inducting the Satyam team working on its IT project or convincing other IT vendors to merge this team with their resources to ensure continuity of work. Satyam's bigger rival Tata Consultancy Services (TCS) already provides services to GE. Talks are on in this regard, says sources.
A Satyam's client since 2004, food major Nestle had extended its engagement with Satyam in 2007 for another three years, landing it a new multi-million dollar contract. The Switzerland-based company says the guarantee Satyam offered on normal continuation of services is not resting assured. "Alternative solutions are being considered and no disruption of Nestl's IT operations is expected," a Nestle spokesman said.
"Clients are evaluating options as their business continuity is at risk. Other suppliers are also working overtime to poach some of these marquee clients," said Nikhil Rajpal, principal, sourcing advisory firm Everest.
Satyam's clients such as British Petroleum have sought assurance from the Indian IT firm that their work will not be impacted. While Indian vendors such as TCS, Infosys and Wipro could bag more work from Satyam's customers, analysts say multinational outsourcing firms such as IBM and Accenture could use the financial scam at the Indian firm to their advantage.
GE is learnt to be weighing the options of inducting the Satyam team working on its IT project or convincing other IT vendors to merge this team with their resources to ensure continuity of work. Satyam's bigger rival Tata Consultancy Services (TCS) already provides services to GE. Talks are on in this regard, says sources.
A Satyam's client since 2004, food major Nestle had extended its engagement with Satyam in 2007 for another three years, landing it a new multi-million dollar contract. The Switzerland-based company says the guarantee Satyam offered on normal continuation of services is not resting assured. "Alternative solutions are being considered and no disruption of Nestl's IT operations is expected," a Nestle spokesman said.
"Clients are evaluating options as their business continuity is at risk. Other suppliers are also working overtime to poach some of these marquee clients," said Nikhil Rajpal, principal, sourcing advisory firm Everest.
Satyam's clients such as British Petroleum have sought assurance from the Indian IT firm that their work will not be impacted. While Indian vendors such as TCS, Infosys and Wipro could bag more work from Satyam's customers, analysts say multinational outsourcing firms such as IBM and Accenture could use the financial scam at the Indian firm to their advantage.
Reader's comments(12)
2: Where is the question of ETHICS? Business is
business! NASSCOM did not save the life of
thousands of skilled engineers when thet were
fired from TCS, Infy, Wipro recently. What is
the role of NASSCOM?
Posted by: Hari - 02:18 PM Jan 13, ' 09
3: Is corruption new to America? why are they
making hue and cry of all these petty
issues....Is America scared of compentecy of
Indian? I am sure there... its just a
strategy to hit the INDIAN MARKET so that
even Indian economy is not left out as
American Economy is in doldrums due to
recession?
Posted by: Abhishek from Lagos - 02:15 PM Jan 13, ' 09
4: Before throwing stones at Satyam, that had
the courage to admit it was faking results,
maybe it would be interesting to investigate
what was going on in 1999 when Satyam AND
Infosys were dealing with Sterling Commerce
in the US, in a very interesting joint
venture.
Posted by: Innocent Bystander - 11:47 AM Jan 13, ' 09
5: Its exactly true! Every rival company is
waiting to snacth their share in a complete
non ethical way. If infy is stong on terms
that it won't hire any satyam employee then
it should not eye its work or customers
either. It is really a tough time for the
employees of satyam.
Posted by: Sreejesh - 09:03 AM Jan 13, ' 09
6: Satyam has a workforce which cannot be
ignored for their technical skills, I think
there is no point people deserting from
Satyam . They need to be given a chance for
there is a new board that has be constituted.
And people do need to keep in mind about the
employees who have served the clients earlier
and were happy with the services rendered by
them.The move away from Satyam effects only
the employees rather than any one else....
Posted by: VBK - 08:19 AM Jan 13, ' 09
7: this is not just satyam`s loss, but india`s
loss. All comments seem to assume that
clinets like BP will go to other rival indian
firms, such as Wipro, TCS etc. yet they
ignore that BP are also considering
outsourcing firms in the Phillipines. So, it
might india`s loss, and the phillipines gain.
this sorry saga, has certainly hurt india`s
reputation in IT, where i am sitting ( in a
uk corporate)
Posted by: rahul - 04:58 AM Jan 13, ' 09
8: Its not just TCS or Infosys or Wipro or IBM
or Accenture that might bag the projects
which could move out of Satyam. Genpact is
trying hard to even grab the employee base at
a cheaper price. Pramod Bhasin (CEO -
Genpact) on his official note clearly
mentioned that "Genpact would closely work
with the current customers of Satyam and also
with NASSCOM to 'Save' the busniess and the
employees. So everyone is eagerly waiting to
grab their share.
Posted by: KVSR - 02:33 AM Jan 13, ' 09
9: No one is to blamed. its all a part of
business. someones loss is others gain.. that
is business.. and if one says that others
were waiting for a chance, yes.. everyone
wants to prove themselves.
Posted by: sppk - 01:49 AM Jan 13, ' 09
10: What a misfortune? the other IT Companies are
taking huge advantage of this. It's a shame
on their part, they are well known to outside
world as IT Majors. Now their behaviour shows
that they have no Business ethics.
Posted by: Srikanth - 11:11 PM Jan 12, ' 09
12: Where are they going to? infy? these
companies were just waiting for their chance.
Posted by: raghavesh - 08:09 PM Jan 12, ' 09
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