The Hindu Business Line : EDS to invest $35 m here

The blueprint
India is one of our largest best shore presence.
To bring outsourcing, applications biz, BPO into single footprint.
To kick-start rejig with Pune, Chennai centres

New Delhi , March 5

IT major EDS has said it plans to invest close to $35 million in India over the next few years, even as the company embarks on a massive realignment exercise to concentrate and transform its highly specialised `best shore' operations, into consolidated multi-skilled delivery points.

"We currently have about 23-25 principle best shore locations. We think 23 are too many. It is not concentrated enough. The overhead and service delivery model is too complicated. Beginning this year, we have begun a concentration drive. The exciting part for the EDS employees in India is that we are concentrating some of the new volume to India," the EDS Vice-President Business Workforce and Capacity Management, Mr Stephen R. Heidt, told Business Line here.

The company defines its best shore locations as highest quality, lowest cost execution points. He said that EDS's capital expenditure for India was pegged at $35 million over the next couple of years.

"India is one of our largest best shore presence. Gurgaon, Chennai, Pune and Mumbai are our key concentration points in India and we also have fairly large scale of operations in Brazil, Argentina, Canada, and Malaysia amongst many other locations," said Mr Heidt, who is also responsible for all EDS best shore activities.

More work in India

He said that EDS had booked business work headed towards India, allowing it to double the India operations from the existing 3,000 professionals to about 6,000 by the end of this year.

EDS focuses on three lines of business that include IT outsourcing, applications business - it has over 40,000 applications developers across the world and BPO business.

Accordingly, it has centres that specialise in all the three areas. "Our concentration strategy in best shore is to bring those three together into single footprints," he said.

Good for staff too

"Not only will it give us effectiveness for a global price point, but would offer a clear career growth path for our employees. The co-location of multiple skills will allow employees to move right up the development path inside our business framework," he said adding, "We are thinking of this in terms of a campus where you can have freshers coming in and growing through the different businesses."

The company would kickstart its global restructuring exercise with Pune and Chennai centres, which currently largely operates as application centres with some sub-products related to BPO. "The Mumbai centre is much more BPO- oriented with a little applications and shared services feel. As we grow, we will start to place the new capabilities into campus environments," he said, but declined to comment on the future strategy for Gurgaon and Mumbai centres.

"For the moment our strategy is to get going. There may still be room for process specialisation in certain centres. The other thing to consider is that we need a degree of reliability and redundancy. So there will be some need for a diversified presence," he said.

Asked if the initiative at a global level would lead to reduction in the overall number of best shore centres, he said, "Yes, it will. But we do not know the number."