Global Sourcing Firms will Capture More Captives
November 6th, 2009Cognizant acquired UBS’ Indian Subsidiary for $75 million – the former supports UBS around the globe with Knowledge Process Outsourcing (KPO), Business Process Outsourcing (BPO) and IT Outsourcing (ITO) and employs 2,000 people in India.
As part of the deal, UBS signed a 5 year $442 million service agreement with Cognizant.
This “Captive Spin-Off” Approach is tried and true approach in outsourcing and a large number of similar transactions are currently in progress around the world.
Analysis
Spinning of a client owned share service center (a “Captive SSC”) is a classic model for growing a BPO business. Most of today’s leading BPO providers used this technique at one time or another in their growth models. Some similar transaction in the past include:
1. Warburg Pincus creating WNS (NASDAQ: WNS) by spinning off British Airway’s SSC in India (“WNS actually stands for “World Network Services” which was the name of the BA …
The Latinization of TCS: Five Nearshore Growth Strategies for 2010
October 16th, 2009[Editors Note: Read the Full Post to See our Top 5 TCS Growth Strategies]
Newly appointed TCS Chief Executive N. Chandrasekaran knows his way around South America.
Moves by Tata Consultancy Services (TCS) to make Latin America a big part of its future reflects a carefully constructed strategy that is going to be felt in a variety of ways across the Americas in the next few years.
Frankly, LatAm affords TCS what it can’t find at home in India – a business consultant population equipped with an obligatory cultural saviness that plays well with US customers, accomodating time zones, growing prominence as a services player that in South America enables TCS to go toe-to-toe with Accenture and IBM, and a shrewd and well-connected executive leadership team that have skillfully helped TCS become a regional powerhouse.
“More and more customers prefer to have dual strategy and they are looking at India plus one more geographical presence” – Gabriel Rozman, EVP Emerging Markets at TCS
In the course of the last seven years, TCS Iberoamerica has gone from running a tiny 15-person office in Uruguay to now employing over 6,000 consultants and establishing global delivery centers in four countries. The driving force behind TCS’s success in LatAm is undoubtedly Gabriel Rozman, EVP Emerging Markets at TCS, a native of Uruguay who has literally opened the door to Latam, through which others like Wipro, Cognizant and Infosys have now traversed.
