There was a news article in economic times yesterday. “IT-BPO combined model shows cracks yet HCL, Infosys and other IT majors believe that’s the way to go”. So gear up, this is the time to encash your skills.
Magic will happen. When Vineet Nayar of HCL Technologies iterates this about a strategic shift his $3.9 billion company charted, it may seem like the stubborn defence of a man who is too proud to admit he might have been off.
About three years ago, HCL and the top-tier IT players threw their weight behind a model they sensed was the future: an IT-BPO combine. Global majors like Accenture were already on to it. The thinking was that IT already shapes certain kinds of business process solutions, and that if they offered both, it would put them on a stronger wicket with a client.
So, say, HCL was already making payroll software for a bank. What if it also took over all processes related to paying salaries to the bank’s employees? Each would feed the other. The BPO (business process outsourcing) side would give HCL a better understanding of what the bank wants on payroll and enable it to craft software accordingly.
And if it crafted good software, it had a strong pitch for the BPO business. That was the thought. Three years on, it mostly remains a thought. According to Everest Research, of the 1,929 deals signed in 2011, only 3% of clients gave both their IT and BPO work to the same company. While this is minuscule, it is also a fall from the 2009 figure of 4%.
The crunch is mainly on the BPO side. For each of the major IT companies, barring Cognizant Technologies, a significant part of their current BPO business is about making calls, which has little or no linkages with the IT side.
Read on – its a 3 page article: