Wipro Consulting Services (WCS) as a global business leader in technology consulting - Coursework Example

? International business strategy Contents SECTION A 3 SECTION B 6 Reference 12 SECTION A Identify and critically assess the strategic challenges confronting Kirk Strawser in 2008, when he is attempting to turn Wipro Consulting Services (WCS) into a global business leader in technology consulting. Explain how you have used module concepts and frameworks in your analysis. The technology consulting business which was a strategic initiative for Wipro Technologies prior to 2001 due to slowdown in the IT sector and now it has matured into a thriving business. Wipro had set its consulting service as one of the dedicated organization and with its own structure. But in order to become the business leader in technology, it needs to go further. It required the independence and also the strategic focus which comes from operating as one of the separate unit within Wipro but at the same time take the advantage of the parent company in technology and to acquire the customer base. Wipro Technologies Ltd is based in Bangalore and employs about 95000 people across its office which is spread globally (Lampel, wt al, 2010). In the year 2001, most of the technology consulting firms such s Infosys, Wipro and Tata Consultancy Services had started to provide the basis IT infrastructure as well as development of application services to its customers. As the companies started to gain a better knowledge and understanding of its customers the companies started to assist them to use IT in their business to improve the efficiency and hence reduce the cost. Today these IT firms face a tremendous pressure in order to deliver high value of IT services to its customers. As a result different business models were adopted by the firms and also by Wipro. Wipro Technologies uses two distribution models namely “Global Delivery Model” and “Fixed Delivery Model”. Wipro have developed globally a competitive business which is based on the expertise and also the ability to identify, train, and manage and motivate the talent. Prior to 2001, it was difficult as well as costly for the company to access their talent in the developed countries. Thus in such a situation it become increasingly necessary for Wipro to develop business models so to compete with the upcoming demand in the developed markets. Under the leadership of Kirk Strawser, Wipro undertook two from of business model. When IT software and consulting firm emerged in India, most of the Indian companies did not use the sophisticated technology to support the system; this further resulted in challenge for Wipro to convince the companies to use the technology and help build them a competitive advantage over the other firms. In addition, most of companies had an in house IT department and was not willing to outsource to other firms. The developed market offered a much deeper pool of customers and also higher price for the services than those in the Indian market (Khanna and Palepu, 2010, p.155). With the emergence of IT services and software, many big companies started to implemented the use of IT and as a result Wipro technologies competed with the service providers of technology. Wipro had faced challenge in its technology sector from two categories one was the global players and the next was the Indian players. Global players included companies such as Accenture, IBM, HP, Cap Gemini and EDS (Burgelman, et al, 2008). These companies had made more than 90% of the global consulting market. Wipro was way behind these companies. The companies made use of the resources and also because of cost advantage of its offshore presence in countries such as Russia, India, Philippines, Europe and others. Indian layers included companies such as TCS, HCL, Cognizant, Infosys and others. Wipro and these firms basically used the same concept as they started their operation with low cost IT service providers and adopted the “global delivery models”, “technology rationalization” and “service integration” (Lampel, wt al, 2010). The terrain of IT services and outsourcing tend to appeared difficult due to the factors of dotcom and also the event of 9/11 which doomed the IT consulting. It was the time to change the business and not just sell the products. In addition, the slowdown in the IT business was also a result of external factors. Companies started to gain an impression that consulting firms such as Wipro and others were not adding the required value for its customers and their accountability for failure were not handled properly and got lost somewhere in between. Thus no economic value was added. Therefore the change in perception, forced the IT business to create a new value chain and transform the business into consultants. Wipro in the third quarter of 003 posted a profit of 2% and to keep its shareholders satisfy the company had to look beyond the low end IT services and thus create high consulting. A strategic challenge with Wipro lied was to change its domain from IT services to consulting firm. But due to lack of knowledge based professionals the process took a longer time and needs to be implemented brick by brick. In order to deal with this change Wipro leader, took a conscious decision in order to incubate and also nurture the development of the new business leveraging the capabilities of IT across the different lines of business. Wipro opened up many new doors for new technology for its new and existing services. Finally Wipro incubated its consulting services with help from its parent organization and sustain the business through various business units of Wipro. Thus with the combination of external events, internal churning and changes in the landscape laid the foundation of Wipro Consulting which was built in a time frame of six to seven years (Lampel,et al. 2006). SECTION B Critically evaluate the impact of national and industry environmental influences upon Indian, American and European competitors in the technology consulting industry, as shown in the Wipro case. Use your findings to reflect upon the advantages and disadvantages of India as a headquarters location for a global services firm. One of the prominent influencing factors for the global consulting firms today is innovation. With the constant demand for customers for high level and quality advisory services for complementing their IT products and BPO services, the consulting firms remain under pressure to furnish customers with cost reduction strategies, capital efficiencies and provide them with improved experience in transformation related programs. Customers are the main determinant of the progress and prospects of these firms. The major technology servicing firms like TCS, Infosys and Wipro have begun to provide information technology infrastructure and application development services towards the customers. Detailed and thorough understanding of the business of customers and assisting them in the domain of IT for better improvement of efficiencies and reduction of costs account for the main responsibilities of the service providers. These firms are also influenced by constant and consistent pressures for the delivery of high value towards their customers and display and demonstrated the ways in which contributions made any difference to the customer’s business outcomes. As a consequence, there has been the evolution of various service models like integrated services and global delivery models in the technology consulting domain (Lampel & Bhalla, 2010, p.5-6). The global technology services providers also remain under constant competitive pressure from other competing firms. For example, Wipro technologies have been competing with firms like Accenture, IBM, EDS, Cap Gemini and HP. These firms are estimated to account for 90% of the worldwide consulting market. They are also said to use the cost advantage and resources of their offshore presence in nations like Russia, Philippines, India and Eastern Europe. The Indian market is flooded with companies such as Infosys, TCS, HCL, Wipro, Cognizant and Satyam. These firms had initially begun their services as low cost information technology service providers and subsequently branched out their operations into consulting activities. Finally they positioned themselves as end to end technology service providers by the adoption of such practices as technology rationalization, global delivery models and service integration. With the existence of a large number of global businesses in information and technology domain, firms are increasingly faced with the pressure to develop and generate strong brands names for their services. For example, the case of Wipro Technologies reveals that the company had to work hard on its brand positioning in order to follow global suit. Some of the brand names that Wipro had to compete with are IBM, Sapient and Accenture as these were dominating in terms of market position. In order to follow global suit the company had to acquire ‘Infocross’ in order to emerge as a strong brand name in the region. The acquisition of American Management Services is also a depiction of expansion of the consulting capabilities of the firm. The company resorted to niche acquisitions in the region in order to emerge as the leading technology giant (Lampel & Bhalla, 2010, p.20). In the recent years, the global IT consulting firms are increasingly confronted with the pressure of distinguishing themselves differently from their competitors. They assign great regards for their value proposition in the competitive world. In this context, it is seen that firms have high concern for the customers these days. They primarily cater to the changing customer needs and requirements in order to retain sustainability and consistency in the global front. Researchers and practitioners have particularly recommended the importance and significance of such customer centric principles. A great amount of importance is assigned to honesty and humility in these companies and along with this they also seek to serve their customers with the maximum integrity. Firms also realize the importance of having a unique and purposeful business value chain and ensure not to copy an external culture into its own organizational culture. WCS takes pride in its ability to make internal changes at the client organizations. It aligned itself with the value system of the customer and seeks to facilitate change from within. It encouraged customers to evolve their own best practices and rely on their own people and culture as much as possible. Researchers have particularly considered the transformation of businesses in assigning importance to the cultural issues rather than the business and technical aspects as commendable and a favourable move for the global IT consulting industry (Lampel & Bhalla, 2010, p.21). The existence of the global IT firms in India has been benefited in a number of ways. For example, as mentioned innovation is a prime requisite for these firms to retain competitiveness ad sustainability in the market. In this context, India is regarded as a major producer of bright and innovative minds. The young and bright innovative minds passing out of the top class B-Schools act as major workforce of these companies. These graduates are trained as analysts in these companies for the first few years by assigning them to the consulting teams and are then rotated globally on live engagements projects. Locations like India are particularly favourable for the IT consulting firms as it has a large service sector which is predominantly run by the assistance of information and technology. Some of the industry domains which are ruled by information and technology are banking services, telecom services, web based applications, enterprise applications, networking, embedded systems etc. Thus these firms can be valuable service providers for these sectors and cater to their IT needs and requirements. These sectors demand services ranging from business intelligence, enterprise applications like ERP, CRM and SCM, service oriented architectures and quality consulting. Industries ranging from the finance, medical to even automotive can be benefited through these services. The most favourable advantage of these firms having headquarters in India is that the region is a major producer of technical talent which is required in the IT consulting firms. Also they can be employed at much cheaper rates as compared to the western countries. However, the rapid technological advancement of the place has made much faster strides that the development and creation of technical talents. Thus it is likely to face with a shortage of workforce or inadequacy of technical talent in the domain. Also the culture and customs of the place are distinctly different from the western countries. Thus organizations are constantly faced with the problem of adapting to the cultural differences between the home country and the host country. How far and in what ways is WCS a ‘born global’ firm? Explore the implications of your argument for the future development of WCS’s networking and innovation strategy. Born global companies tend to gather much more attention than they receive as growth strategies which provides lessons to many different organizations. Companies are born global and this can be well said for Wipro Consulting services. It was born to serve the growing needs of the customers not only in India but also outside India by arbitraging the matter of cost differentials between Indian software companies and American professionals (Cohen, 2007, p. 192). Companies like Wipro, Infosys were born global and this is because they understood that in the notion of time since there was a huge advantage of human capital, the fulfillment requirements or the needs had to be on the global basis. These companies were the instrument in the process of sparkling the imagination of the entrepreneurs to seek the option of “born global” business model (Kumar, et al. 2009, p.46). Wipro evolved as a totally new development model. The model aimed to leverage the advantage of human capital that the country provides in order to fulfill the needs of global clientele (Kachru, 2011, p.146). Wipro can be rightly being referred to as a born global firm because it has gone way beyond competing in its home market but also internationally. It was ranked next only to IBM in overall ranking. Wipro with its broad as well as growing global capabilities which also included a partnership strategy has emerged to be the growing global company. Wipro has compelled its ideas on how to deliver value through innovation and also through continuous improvement of its strategy, technology to fit the changing needs of the environment. From the time of its execution Wipro has been providing services not only in the Indian market but also internationally where the services were valued much more than in its home ground. Wipro has a well distributed workforce towards the globe but majority of them still deliver RIM in India. In America about 13% of the workforce is situated amounting to about 1798 employees, in EMEA about 11% comprising of 1553 employees and in AP 76% resulting in 10650 employees. It client base is also distributed globally. It has entered into a strategic alliance with respect to technology with companies such as Microsoft, Cisco, and EMC. The company emphasizes the outcome of its business and aligns are based on an agreed working practice, strategic fit and also practice by the government. Wipro tends to work as sub, prime, ecosystem partner and demonstrates to well perfectly in the context (Roehrig, 2009). Wipro, a born global company because of the fact that the home supply conditions for the company was satisfactorily and it is one of the important factors that contribute towards international success. In addition to home conditions, factors which hence leaded to the decisions of early internationalization were such as conditions of the new market, the presence and availability of global alliances and networks, homogenization of the needs of the buyer, the global environment and the customers; secondly because of advancement made in technologies, such as e business, and finally a opportunity to learn from overseas. Wipro Consulting Services, founded that the need of its IT firms and other business were well adopted in the international market and thus along with technological advancement and an opportunity to adapt to new environment and satisfy the requirements and needs of its customers I the international market. Wipro has been able to regard itself as a born global firm but it should continue to gain an upper scale in order to be competitive for various global deals and situations. A major advantage with Wipro lies on the fact that it has a strong and good profitability ratio and growth in its business. Hence Wipro has proved that its execution capacity and strategy has worked well and is likely to perform in the same manner in the years to come. Wipro is also known for its innovation and it is also one of the reasons for the company being regarded as “born global”. The company has always invested into latest technologies and research. As the global environment keeps on changing, change is the only constant thing and Wipro has adopted the policy of change to adapt to the changing environment. Today the businesses are facing huge challenge as well as opportunities which are totally different from the past or even a year. So the globe, the world is looking up to innovations and it is through innovation that a company can survive and achieve a competitive advantage not only in the home grounds but also in the international market. Thus Wipro believes that it has the capacity to leverage the culture of innovation so to push the boundaries to deliver solutions that provides an enhanced value and directly imp[act the customers (Wipro, 2011). The company has been investing into virtual corporation such as cloud computing, collaboration, green technologies, mobility, social computing information management and others. In order to stay ahead of its competitors such as Infosys, TCS, and IBM, Wipro needs to gain an upper hand in technology and this can happen through innovations. In addition, Wipro has also joined hands with Cisco, through strategic alliance in order to develop as well as deliver information technology services to help the companies meet the need of its customers in the fast growing global market. Wipro is the global leader in IT industry and delivers services to enterprises and also implements innovations which help the businesses to achieve a new level of productivity (Cisco, 2012). Thus for the future development of WCS, the firms should recruit consultants with prior experience; it needs to keep up with the new knowledge not only of industry but also of new technologies such as CRM. Wipro should also re examine its global delivery model as an important source towards differentiation strategy. Finally Wipro technologies and WCS should nurture the relationship in order to build a long term perspective and enhance brand recognition of the company and its parent company. Reference Burgelman, R. A. Christensen, C. M. and Wheelwright, S. C., Strategic Management of Technology and Innovation. McGraw-Hill Irwin. Cisco, 2012. Press release. [Online]. Available at: < http://newsroom.cisco.com/dlls/2007/prod_103007e.html> [Accessed 26 May 2012]. Cohen, E., 2007. Leadership without Borders. India: John Wiley & Sons. Kachru, U., 2011. India, Land of a Billion Entrepreneurs. South Asia: Pearson Education India. Khanna, T. and Palepu, K. G., 2010. Winning in Emerging Markets: A Road Map for Strategy and Execution. USA: Harvard Business Press. Kumar, N. Mohapatra, P. K. and Chandrasekhar, S., 2009. India's Global Powerhouses: How They Are Taking on the World. USA: Harvard Business Press. Lampel, J. Bhalla, A. and Vishnu. K., 2006. WIPRO CONSULTING SERVICES IN 2006. [Pdf]. Available at: < http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1494275> [Accessed 26 May 2012]. Lampel, J., Bhalla, A., and Vishnu, K., 2010. Wipro consulting Services:Building an Effective Global Configuration in Business and IT Consulting Industry. Asian Case Research Journal, Vol. 14, Issue 1, 1–30. Roehrig, P., 2009. Wipro Is A Leader In Global IT Infrastructure Outsourcing. [Pdf]. Available at: < http://www.decisionone.com/images/pages/WIPR_%20WAVE_Excerpt.pdf> [Accessed 26 May 2012]. Wipro, 2011. About Wipro. [Online]. Available at: < http://www.wipro.com/about-wipro/Innovation-at-Wipro/> [Accessed 26 May 2012]. Read More