Infy expects small deals to corner 5% of revenues

Infosys Technologies is keen on cornering smaller deals (dubbed modules) and expects them to account for 5 per cent of its revenues in the next financial year.

"Our new 'go to market' strategy uses a brick-by-brick approach as opposed 'all at once' approach promoted by incumbents in the west. The approach has already found wide acceptance in the US but was yet to catch on in Europe.

Though a small portion of our business now, we see this contributing 5 per cent of our total revenue in fiscal 2006," said Basab Pradhan, head of worldwide sales.

Pradhan said the model was particularly effective in the US as far fewer large deals are being struck in corporate America in the recent past.

"The company will develop a service - usually a small one like designing an application or innovating a process which can be completed in 15-30 days.

It can put employees with 1-2 years experience on this. This way, these not-so-experienced people are utilised well and once company proves its expertise in one module more and more companies will approach them for the same. This is called productisation of services," an industry source explained the benefits of such a model.

A typical 'modular outsourcing' deal less than $1 million. Launched in May 2004, the 'modular outsourcing' model allows enterprises to adopt a best-of-breed strategy "" source their needs from various services providers "" by dividing business processes and IT systems in modules.

It is done by breaking up business processes, applications and infrastructure needs into different functions such as innovation, design, development and maintenance which are then outsourced to different companies.

The technique is expected to enable innovation in business and help companies derive the best of global sourcing.

Infosys has 10 clients with deal sizes over $30 million and three with deal sizes over $ 50 million. Infosys registered a 49 per cent growth in its net profit in the second quarter ended September 30, 2004 to touch Rs 447,37 crore. Its revenue was up 52 per cent at Rs 1,749.33 crore.