Globalisation of Indian IT Sector
23 February 2011
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Global technology and outsourcing -- market size & growth
Global technology spending grew by 4%,outpaced by global sourcing growth of 10%
*2010
Source: IDC, Everest Research, NASSCOMM
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Indian IT – BPO industry export revenues
• India’s share in global sourcing –
Indian IT-BPO Export Revenues *
(USD Billion)
55% in 2010, up from 51% in 2009
• Industry accounts for 26% of India’s
exports
• IT services exhibiting fastest growth
`
at 23%, BPO growing by 14%
• Transformation, new business
models, driving organization wide
efficiencies
• Emergence of verticalised solutions
*Excluding Hardware
Source: NASSCOMM
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3
Domestic Indian IT – BPO industry
Indian IT-BPO Domestic Revenues *
(INR Billion)
• Domestic industry over $16 billion
annually
• IT – BPO seen as a critical
enabler for inclusive growth and
transformation
` • Government drive to drive
performance and efficiency
accelerating growth (like private
sector to handle issue of
passports, railway reservation
automation, free internet kiosks
for villages)
*Excluding Hardware
Source: NASSCOMM
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Employment - Indian IT – BPO industry
Direct Employment (‘000)
• Industry directly employs 2.5 million
professionals
• Industry building future ready
organizations through
• Sustained investment in training
• Opportunities for career growth
`
• Managing people challenges
effectively
• Ensuring cost competitiveness
• ~2 per cent of revenues spent on
training - industry supplementing the
education system
Source: NASSCOMM
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Indian IT – BPO industry exports – sector wise trend
Broad-based growth – Emerging verticals growing faster than the traditional ones
Source: NASSCOMM
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India multipliers – for being future ready
New Business
` Models
• Shift towards managed services model,
• From FTE based to outcome based; pay
per use model, CAPEX to OPEX
Innovation and
` Transformation
Patents granted to top 5 Indian
IT companies
• IP Led innovation
• Innovation through process reengineering
Global Delivery
`
Service delivery
` around new tech
• Globally dispersed footprints
• Customer intimacy
• Everything as a service model,
platforms
• Develop applications around cloud and
platform based solutions
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Cross-border M&A Deals
Outlook and challenges
Future Growth
& Outlook
• FY2012 software and services growth forecast 16-18 per
cent
• Broad based growth – across service lines and verticals
• New geographies(APAC, Middle East, Japan) incl. domestic
`
market
• M&A - niche domains and global presence to escalate
• Onshore delivery – key priority
Challenges
• Talent – quality and employability; Wage Inflation and
attrition
`
• Currency fluctuations, Inflation
• Issues of Protectionism and Visas
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A quick snapshot of HCL
$5.5
29
77,000
B
I
L
L
I
O
N
COUNTRIES
P
HCL Enterprise
E
O
P
L
E
HCL InfoSystems
HCL Technologies
The systems
integration arm
The software
services arm
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Global Presence
CANADA
SWEDEN
Toronto
Utah
Chicago
Stamford
New Jersey
Dallas
Fairfax
CARY, NORTH CAROLINA
Columbia
Houston
Mexico City
PUERTO RICO
Sunnyvale
Irvine
Los Angeles
FINLAND
U.K.
Belfast
NETHERLANDS
KRAKOW,
London
CZECH
BelgiumREPUBLIC
GERMANY POLAND
FRANCE SWITZERLAND
ITALY
Israel
SAUDI
ARABIA
Beijing, China
Dubai
JAPAN
SHANGHAI, CHINA
INDIA
HONGKONG
MALAYSIA
SINGAPORE
Sao Paolo
SOUTH AFRICA
SAO LEOPOLDO, BRAZIL
Brisbane
Sydney
Perth
Melbourne
• 10 Global Delivery Centers (outside India)
• 6 Delivery centers in UK (out of which 2 are in Northern Ireland)
• One of the largest employers in NI today – employing over 2,000 people
• Over 4,500 employees working for HCL in Europe (including onsite presence)
10
Auckland
Wellington
Globally Admired
Included in Forbes’ prestigious
'Asia's Fab 50 List' for 2010
One of the 44 Most Democratic
Workplaces in the World
One of Britain’s
Top Employers for the
4th Consecutive Year
Best Employer in India –
Hewitt Study 2009
HCL Technologies is Disruptive and
Bears Watching…though it has not
received the hype of a salesforce.com
or Google, we believe HCL may very
well be one of the contenders to lead
the IT services world of the very
near future.”
HCL is taught at Harvard as a
premier case study on strategy
and organizational leadership
“IBM and the other multinationals
are becoming increasingly
nervous about HCL Technologies…”
Darden School of Business has done a case
study on the impact created by HCL through
its “Employees First Customers Second”
practice
Acknowledges HCL Technologies
as the world’s most
modern management
Employees First, Customers Second
is now a book Published by Harvard Press
Foreword by Late Prof C.K. Prahalad
Admired by many global thought leaders
Tom Peters, Tony Hsieh,11Gary Hamel, Judy McGrath
Ram Charan, Victor K. Fung
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Scale and Integrated services capability
Integrated services – Major Client Deals
Client
Deal
Service
Components
Deal
Value
Period
World’s Leading
Pharma Company
~$500 mn
5 Year
Leading global
investment bank
~$200
mn/year
9+ Year BPO, ITO,
IMS
International long term
savings groups
~$200 mn
5 Year
UK Based Leading
Telecom Major
~$100
mn/Yr
5 Year
Client Profile
About our Success…
BPO, ITO
BPO, ITO,
IMS
BPO, ITO,
IMS,
Consulting
"To all the remaining doubters out there: HCL has just whipped
away your comfort blanket! This deal is proof that Indian-based
outsourcers have what it takes to beat the established players,”
About our Leadership….
Rated as leader in Global Delivery Infrastructure
Management Wave
Ranked in the “Leaders” Category of the
Global Outsourcing 100 - IAOP
“HCL’s recent IT outsourcing and hosted application
management (AM) contract wins heralds a milestone in both the
offshore IT services competitive landscape and the U.S. IT
outsourcing and application outsourcing markets”
Ranked 1st among the Top 50 Best Managed Global
Outsourcing Vendors – Black Book of Outsourcing
IBM and the other multinationals are becoming increasingly
nervous about the fifth-biggest Indian outsourcer, HCL
Technologies
Gartner puts HCL as a Challenger in Application
Services
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HCL Strengths (As defined by our Customers*)
Entrepreneurial
Broad based
Culture
Services
• Engineering DNA
• Skin in the game
• Most balanced
portfolio
• Globally
competitive
Highly
Engaged People
Customer
• Leadership
commitment
• Employees First
• Aligned with
customer’s
strategy
• Transparency
Aligned
70 CIOs/ CTOs form the HCL Customer Advisory Council
good to do business
“ It’s
with HCL
”
* Source: HCL Brand Workshop conducted with HCL CAC members Oct/ Nov 2010
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Thank You
For further details and questions, please contact:
Udayan Guha
Vice-President, Europe
HCL Technologies - Business Services Division
Mail: uguha@HCL.com
Mobile: +44-75450-86986
Tel:
+44-20-7105-8600
HCL, 7th Floor, 68 King William Street, London, EC4N 7DZ
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