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Satyam's European partners seek clarification on projects
By siliconindia
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Tuesday, 13 January 2009, 19:14 IST |
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Mumbai: The Satyam saga of unethical dealings seems to be affecting the company's partners overseas as many IT companies in the Europe, who contracted with Satyam for various projects, are now expressing concerns over the future of the projects. IT companies in Europe like NNIT of Denmark Arvato Systems of Germany and Capgemini of France have sub-contracted some of their clients' work to Satyam, reported BusinessLine.
Industry sources believe that if Satyam is not able to finish its assigned work on time with quality, the delivery of final projects to be made by European firms to their clients may also get delayed. The European partners are now observing the development closely. "We have asked Satyam for an account on how they plan to guarantee their deliveries to NNIT in this situation, and are awaiting their answer," said Karsten Fogh Ho-Lanng, Corporate Vice-President and Chief Technology Officer, NNIT. The company is partnered with Satyam to jointly develop SAP solutions and provide support to pharmaceutical clients in Denmark.
Realizing the cost-effective services in India compared with Europe, several IT vendors in Europe have sub-contracted work to Indian companies. Indian firms have also advantages as they use it as a strategy to break into key customer accounts.
In Decmber, Dr Carsten Bittner, Director, Managed Services International of Arvato Systems had said, "By off-shoring 20 percent of any IT project to a company like Satyam, European firms can price their services cheaper compared to those companies who don't have any offshore presence."
Germany-based Arvato System is partnered with Satyam to jointly provide offshore services to the medium-sized enterprise market in Germany, Austria and Switzerland. Concerned over the future of the projects, Arvato is also taking step to check the ability of Satyam to overcome the crisis. The company is closely monitoring the developments at Satyam. A company spokesperson said, "Currently our relationship with Satyam continues unhindered. However, we cannot give any insight into the future."