After taking over Alight Solutions' India unit, information technology services major Wipro is in the process of creating a new business line, under its business process outsourcing (BPO) services division, to offer end-to-end human resource (HR) solutions and services.
Sources said the Bengaluru-based firm is integrating the operations of Alight HR Services India into its HR practices to position itself as one of the largest players in the space.
"Alight HR Services India has around 8,500 employees. Now, a team of around 500 people who already work in the HR domain at Wipro BPO will be part of this new business line," said senior sources. "This will make the company one of the largest HR players in this space, giving it a larger footprint."
The company will also join Wipro with its proprietary platforms covering all the processes in the HR domain. It currently operates out of four centres -- Gurugram, Noida, Mumbai and Chennai. With the joining of Alight's staffers, Wipro's BPO arm will have around 54,000 employees.
The fine print for this new business line is being worked out. Jasjit Singh Kang, who was heading the India business of Alight, is likely to lead this new line, the sources add.
In its largest ever contract, Wipro in July this year had won a 10-year deal worth $1.6 billion from US-based HR and financial solutions company Alight Solutions LLC. As part of this, Wipro had said, it would acquire Alight's captive India unit for $117 million. Wipro was also mandated to digitally transform the Illinois-headquartered company's business, as part of this arrangement.
Analysts say the new unit will help the company to compete with bigger entities in HR process outsourcing. Globally, HR practice is one of the largest segments in BPO services. Dominated by larger entities such as Hewitt, Conduent and Mercer, apart from IT service companies such as Accenture. Traditionally, Indian companies have had a low share in global HR services.
"All global top players in BPO space are heavy on HR, while most Indian firms have a very small presence. Though this arrangement, Wipro will be able to compete with these global HR players," said Pareekh Jain, managing director, India, at HfS Research. "Definitely a positive step if Wipro intends to enter into HR in a big way."
Also, say analysts, it would help Wipro in designing HR solutions in the Workday (a cloud-based HR software) consulting space. The domain knowledge should help Wipro in developing software as service (SaaS) platforms and solutions in HR.
According to sources, the revenue upside for Wipro from this strategic move would not flow this year but trickle in from next year. "The company is now in investment mode. So, revenue accretion is likely to happen from next year onwards," another source said.