The Hindu Business Line : Service providers expanding base in China

Hyderabad, Dec. 28 After sustained focus on Western shores, China is now high on their charter for Indian IT services providers. Most companies are bolstering their presence directly and through local alliances in some cases.

While technology education services providers such as Aptech along with local partner Beida, and NIIT, have made big inroads, it is the turn of IT services providers both Tier I such as TCS and Satyam and Tier II companies to expand their footprint. This is done through interaction with some technology services providers.

Zensar serving MNCs

The Chief Executive Officer of Zensar Technologies, Mr Ganesh Natarajan, who is also a very active member of Nasscom, told Business Line “there has been no fundamental change in China over the years and the market continues to mature. But what is important is that most of the clients with whom we work, want us lately to also function out of China.”

“This has meant opening up centres of excellence to serve the expansion of multinational companies, leading

us to open up a centre in Shenzhen. At least three transnational financial services providers and two manufacturing companies are expanding and want us to support from China,” Mr Natarjan said.

“There is no dearth of local talent and they are willing to learn to meet our requirements,” he said.

TCS strategy

The General Manager of TCS and Head of Hyderabad operations, Mr V. Rajanna, said: “China is the second most preferred offshoring location after India based on availability of the talent base, cost and business environment. It has the potential not only as a sourcing base for offshore service providers but also offers a huge domestic market.”

Mr Rajanna said: “China produced 4,00,000 computer science graduates in 2006 compared to 1,00,000 in 2002. The TCS strategy for China has been three-pronged, China for Global (leverage China to serve global customers), China for Regional (Leverage China as a regional sourcing base for neighbouring markets in Asia Pacific due to language and cultural affinities), and China for China (leverage China to serve China domestic market). TCS now operates out of several locations, including Beijing and Shanghai.

Satyam campus

The Head of Satyam, Learning Centre, Mr Rajul Asthana, told Business Line that the company’s strategy has been to step up presence in non-English speaking geographies, and China forms a key element of this move along with Malaysia and Japan.

Satyam is setting up a large campus in China at Nanjing, wherein it expects to create a facility for about 2,500 people. This would be another big centre along with Malaysia.

This campus with other locations at Guangdong, Beijing, Shanghai helps the company serve multinational corporations. About 80 per cent of recruits are local people, who are competent and willing to learn to meet requirements, he said.

Sierra centre

In the case of Sierra Atlantic, the company entered China through the acquisition of Array. The Chief Executive Officer of Sierra, Mr Raju Reddy, said that the company’s centre in Shenzhen is aimed at being close to some of the clients offering them product development and support services.

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