Selects Wipro, Collabera as vendors; total IT sourcing from India about $1 billion.
US-based retailer Walmart, also the largest company in the world, has increased its information technology (IT) sourcing strategy from India by setting up a dedicated group here (in Gurgaon). Called Remote Services Management, the group is headed by Micky Singh who was earlier the CIO of Walmart India and responsible for setting up complete IT solution to Bharti-Walmart, covering all facets of the retail joint venture.
According to highly-placed sources, Remote Services Management will be part of Walmart’s Information Systems Division (ISD), the in-house IT arm of the company. This is for the first time Walmart’s ISD has set up an arm outside the US.
With this, the company wants to identify a number of Indian IT partners based on their areas of strength, rather than giving a huge IT contract to any single company. As part of the strategy, Walmart has also awarded contracts to two more Indian IT services firms, Wipro and Collabera (a privately-held IT services company) to develop specific tools and application, and provide services around that. The contracts are estimated to be over $200 million for multi-year periods. Walmart has already awarded IT contracts to Infosys, Cognizant and UST Global for sourcing specific services and applications for Walmart globally.
With the selection of more vendors, Walmart’s total IT sourcing from India is estimated to be in the range of $800 million-1 billion. To a specific query from Business Standard, Walmart said the numbers were speculative and not based on fact.
The company, however, said it had relationships with a number of partners and it did not want to comment on the nature of those business relationships. “As a global company, Walmart will make investments in technology to benefit the operations here and elsewhere in the world. We will need worldwide resources, and our work with suppliers in India will help us continue to grow our business and create jobs around the world,” the company spokesperson said in an email reply.
A Wipro spokesperson said the company did not want to comment on market speculations. Collabera, too, echoed this.
It is understood that Wipro will be responsible for application development and infrastructure outsourcing for Walmart stores globally. Besides, the company has also established a large helpdesk as part of its BPO practice. On the other hand, Collabera will develop collaborative tools for specific retail applications.
According to industry sources, in his new role Micky Singh will be responsible for identifying Indian IT partners. For example, the Thiruvananthapuram-based UST Global is responsible for specific testing of its retail applications because of its inherent strengths in software testing.
Walmart typically prefers to develop its retail applications in-house. However, the company gradually started buying packaged retail applications from leading software vendors like Oracle, HP and SAP only towards the end of 2007.