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Reflecting Demand for Nearshore Innovation, TCS Positions Ecuador as an IT Exporter

Tata Consultancy Services Latin America (TCS) has big plans for Ecuador.

The global IT consultancy’s operations in Ecuador is being positioned to turn the South American country into one of the very few exporters in its portfolio of territories in the region. “As TCS, we are looking not only at the domestic potential [of Ecuador]. We have started looking at external potential also,” said Rupesh Sinha, Ecuador Country Head at TCS, in an interview with NSAM.

“We would love to develop this location to sell to our international customers; not only regionally,” he added. “We could also look at some of our North American customers that would have operations over here. So, for them to do that work somewhere else, perhaps we could help them locally.”

The move is uncharacteristic of TCS. Though the firm has presence in 20 cities throughout Latin America, it usually provides services to local customers. It uses very few of its territories as exportation points. Mexico, Uruguay and (most recently) Guatemala remained as the only exceptions.

“We are looking not only at the domestic potential [of Ecuador]. We have started looking at external potential also”–Rupesh Sinha

Sinha assured, however, that the company is not in a hurry. Though its Ecuadorian team is already servicing North American and regional clients, the process of growing their foreign client base will be slow.

“We look forward to Ecuador getting into the global stage, slowly, in the IT industry. We have started serving some of our international customers from Ecuador on a smaller scale,” said Sinha. “We’re taking baby steps […] I see Ecuador having potential to get into that segment of service exports.”

Rupesh Sinha, Ecuador Country Head at TCS

For now, between 5% and 10% of the company’s 1,600 Ecuadorian workforce is being harnessed to serve international and regional customers. Though a small portion of TCS’s team, the whole gamut of services is being provided: from CX and back office operations to digital transformation and cloud migration.

TCS knows it still has a long way to go. The company will have to work in tandem with Ecuador’s universities and government bodies to grow the industry to the proper size of an IT services exporter. Nevertheless, Rupesh Sinah sees the country getting there in less than a decade.

“I look forward to, say, a bank which is probably based in North America, with presence in Latin America, having a small technology center in Ecuador which can serve its needs in the region,” he said. “I do foresee that in the next five years there could be technology centers, offshore/nearshore delivery centers for North American customers or some of the regional customers.”

In a Long-Term Relationship with Ecuador

This year marks TCS’s 15th anniversary with operations in Ecuador, and the firm expects to remain in the country for a while still, even with rising tensions in the streets.

“I know we are in the middle of a protest, but if you look at the impact on our operations? Negligible,” assured Sinha. “In the last 15 years, we have never been in a situation where we feel the threat of not being able to meet our customer obligations due to certain sorts of events.”

Ecuador endured over two weeks of protests in June. Indigenous groups took to the streets to demand government action against climbing gas and food prices in an economy ravished by the Covid-19 pandemic. Demonstrators blocked the roads leading to the capital (Quito) and other cities, puting the country’s main urban areas under threat of food and fuel shortages.

Though the protests have been called off after demonstrators struck an agreement with federal authorities, the events will most likely add to Ecuador’s fame as an unstable territory in a region that foreign investors already consider to be politically and economically unstable. The country witnessed wide protests against the government’s economic policies in 2019 and 2020 too.

Nevertheless, TCS seems committed long-term to its relationship with the country.

“What we look at, leaving aside some of the problems of the moment, is whether it can give me a long term view; can we operate in this country over the next 15 years, 20 years, maybe forever,” explained Rupseh Sinha. “That long-term view helps us have risk mitigation plans for some of the complications that might happen.”

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In spite of the protests, Ecuador remains an attractive territory for TCS’s strategy in Latin America, assured Sinha. The country has quality perks, like its use of the US dollar as national currency, a time zone that overlaps with that of main American cities, a wide enough pool of quality IT talent and a client base with enough potential to warrant the bet.

TCS landed in Ecuador back in 2007. From that point on, the firm has been both witness and an important player to the development of the country’s IT services industry. Now, according to Rupesh Sinah, the local industry is starting to show signs of confidence in its own capabilities and will hopefully begin to bet on the building of in-house tech solutions instead of their importation.

Cesar Cantu

Cesar is the Managing Editor of Nearshore Americas. He's a journalist based in Mexico City, with experience covering foreign trade policy, agribusiness and the food industry in Mexico and Latin America.

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