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| TCS aims to make BPO a $3 billion business |
| BS Reporter / Mumbai Jul 19, 2009, 00:51 IST |
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To add 1,500-2,000 people in the next 12 months.
 Tata Consultancy Services (TCS) aims to make its business process outsourcing (BPO) business worth $3 billion in the next five years.
TCS’ revenue from the BPO segment for the first quarter of financial year 2009-2010 was Rs 822 crore, that is, 11 per cent to the total.
The BPO segment, with 26,000 employees at present, will add 1,500-2,000 people in the next 12 months. The company said none of its 24,885 campus recruits would be asked to join the BPO unit.
N Chandrasekaran, chief operating officer and executive director, TCS, said the BPO offering was key to the company’s full services play and providing end-to-end services.
To ensure full-service capability, TCS BPO, other than vertical and horizontal services, would also offer KPO and platform-based services, he said.
Chandrasekaran also introduced the management team heading the BPO operations. Abid Ali Neemuchwala will head the overall BPO practice, with Rahul Singh looking after the BFSI segment. V K Raman will be responsible for focus on all other verticals and Raj Agarwal will head the platform BPO solutions unit.
For TCS, the BPO play would be slightly different, said Chandrasekaran. The three core elements, he said, would be: Large-scale domain-led transaction services that would ensure huge cost efficiencies for clients; integrated IT and operations; and platform-based business model, which will shifts the business model to pay-per-transaction.
At present, TCS BPO has 50 services domain and seven platform-based offerings. The company already has 14 deals for its platform-based BPO services. Of these, eight customers are live while others will go live soon. The company said that going ahead, it might look for acquisitions to expand its platform offering.
The BPO will also utilise partner eco-system to scale up operations. For instance, CMC, a subsidiary of TCS, has solutions for digitisation and biometrics that can be leveraged by the BPO. Similarly, Tata Communications’ large networking capabilities and data centres could be used for hosting applications. Neemuchwala said, “BPO is a huge opportunity, both globally as well as in the domestic market. The global market is expected to be over $400 billion in 2013, of which the total offshorable market is a $80 billion opportunity. Of this, BFSI is the largest segment with over $100 billion.”
Analysts tracking the sector said that it was natural for the IT giant to increase its BPO focus. “IT players have realised that there are some aspects of BPO that are recession-proof as they cater to non-discretionary spend. So, focusing on these capabilities makes sense,” said an analysts tracking the sector.
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