IBM Tops India's Outsourcing Market - InformationWeek

InformationWeek is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

IT Leadership // IT Strategy

IBM Tops India's Outsourcing Market

Big Blue is outpacing domestic competition on the subcontinent.

IBM's efforts to expand its footprint in developing markets appear to be paying off, as new figures show the company holds the largest share of India's burgeoning domestic IT services market.

Contract wins from large Indian enterprises such as Hindustan Petroleum, North Delhi Power, and IDEA Cellular helped IBM capture 10.8% of India's local outsourcing market in 2008, IBM said Tuesday, citing data from Springboard Research.

IBM services customers on the subcontinent also include Bharti Retail, Religare Enterprises, and Kotak Mahindra bank. "Springboard's assessment of our leadership in India underscores the success of IBM's strategic focus on growth markets," said IBM India managing director Shanker Annaswamy, in a statement.

IBM has been hiring workers in India by the tens of thousands in recent years, and its total head count in the country now exceeds 60,000. While most of those workers are focused on IT projects outsourced from the United States, an increasing number are being tasked with servicing IBM's growing roster of Indian customers.

"Every client -- big or small -- wants to optimize their IT investments, innovate, become more operationally efficient, and mitigate risk," said Annaswamy.

In capturing the lion's share of India's tech services market, IBM has outpaced indigenous competition from firms such as Wipro, Infosys, TCS, and Satyam. Going forward, the company may benefit from an accounting scandal at Satyam that, in the eyes of some observers, has tainted the homegrown industry.

On Jan. 7, Satyam chairman Ramalinga Raju admitted falsifying the company's cash position by as much as $1 billion while overstating quarterly earnings and revenue by up to 28%. Satyam may also have falsified employee numbers and other data. Raju tendered his resignation and has since been arrested and jailed.

IBM's aggressive expansion in India has drawn criticism from U.S. workers faced with job losses. IBM has laid off more than 5,000 U.S.-based workers since the beginning of the year, according to labor group [email protected] IBM hasn't confirmed the numbers.

Still, IBM shows no signs of slowing its investments in India. The company works with more than 2,200 customers in the country, across numerous industries. IBM said Indian businesses have signaled strong demand for a range of services, including green IT consulting, risk mitigation, and business transformation.

As U.S. sales slow, IBM is investing heavily in developing markets beyond India, including South America and Eastern Europe.

We welcome your comments on this topic on our social media channels, or [contact us directly] with questions about the site.
Comment  | 
Print  | 
More Insights
2021 Outlook: Tackling Cloud Transformation Choices
Joao-Pierre S. Ruth, Senior Writer,  1/4/2021
Enterprise IT Leaders Face Two Paths to AI
Jessica Davis, Senior Editor, Enterprise Apps,  12/23/2020
10 IT Trends to Watch for in 2021
Cynthia Harvey, Freelance Journalist, InformationWeek,  12/22/2020
White Papers
Register for InformationWeek Newsletters
Current Issue
2021 Top Enterprise IT Trends
We've identified the key trends that are poised to impact the IT landscape in 2021. Find out why they're important and how they will affect you.
Flash Poll