India's largest IT consulting and services company, Tata Consultancy Services (TCS.NS : 434.1 +14.3) (TCS), has drawn up an ambitious blueprint for its BPO (business process outsourcing) business. The target is to take BPO revenues to Rs 15,000 crore from the current Rs 822 crore in the next five years.
The management reckons that this would be achieved by having a broader BPO strategy, which inclueds not just being an 'all out' voice-based service provider. Instead, the company would be providing value added services drawn from its TCS IT service practices.
On one hand, it would look at bundling its IT service based advantage with domain specific operational offerings to provide customer value under the 'integrated domain focssued BPO' aegis. It would also be looking at building other expertise in the area of 'platform BPO propositions' that will focus on delivering specific outcomes rather than just pure operational support.
In addition, there would be the 'knowledge services' that would add further value to the normal offerings.
At the end of first quarter ending June 30, 2009, TCS's BPO business was worth Rs 822 crore with 26,000 associates. To meet these ambitious plans,
TCS would hire 1,500-2,000 people in India in the coming next 12 months and these would be fresh recruitments.
N Chandrasekaran, chief operating officer and executive director, TCS, said: "Currently, the BPO business contributes about 11% of the TCS overall revenues and we are targeting a global BPO market of $ 400 billion in 2013 which itself is very large."
The total offshore-able market (by 2013) is over $ 80 billion of which about $ 30 billion is expected to be in India and $ 50 billion in other low-cost countries.
The business will be largely driven by BFSI (banking financial services and insurance), which is the largest segment with over $ 100 billion market and will be more than 50% of the revenues for TCS BPO.
The rest contributing verticals would be healthcare, retail, utilities, travel and transportation and manufacturing.
Global head BPO services, TCS vice-president Abid Ali Neemuchwala, said, "We have figured out our next milestones in terms of people, process and technology and we will be leveraging our platform based and domain focused technologies to grow the BPO business."
TCS BPO has over 100 customers and the company would focus on leveraging and cross selling the domain focused BPO services to its 930 client in the existing services business. Chandrasekaran, also added, "We would focus on the non-linear business that constitutes of the horizontals like Finance and Accounting (FandA), human resources, supply chain management (SCM) and customer services as it would take longer and to leverage our growth from the linear business that is the verticals."
The company said that it had already made investments in developing platforms and would be leveraging it to develop business.
TCS BPO currently has seven platforms including advanced analytics, Aspire (reconciliation), payment and life and pension platforms. The company has cracked 14 deals in the space however only eight are active as of now and the rest are in transformational phase.
TCS said that the acquisition of Citi's captive BPO unit has helped the firm get the largest contract in the industry of about $ 2.5 billion and it signed four non-Citi deals in the first two quarters after acquisition.
The company has now forayed into new areas like capital markets and global delivery for Citi.
1 comment:
Companies like TCS and Wipro can easily touch this targets. BPO in India is still growing.
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