COVENTRY UNIVERSITY

Faculty of Engineering and Computing

M40EKM – CHANGE MANAGEMENT

Session: 2010

Module Leader:

Dr. Rajeev.K.Bali

Module Assignment

Prepared by:

ABHILASH MUKUNDHAKSHAN (2996950)

Submission Date:

21 may 2010

TABLE OF CONTENT

1

Preamble 3

Company Background 4

Financial Pose 6

Organisational Structure 8

Organisational Culture 11

The Nature of Organisational change 13

Business Strategy 13

Global Strategy 14

Co Innovation Network (COIN) 16

SWOT Analysis 17

Porter’s Analysis on TCS 19

PESTEL Analysis 23

Future Plans 26

Recommendation 26

Conclusion 27

References 28

PREAMBLE:

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Tata Consultancy Service (TCS) is the world’s leading global Information

Technology consulting firm and business outsourcing organization that envisaged

and forged the espousal of the flexible global business practices, which nowadays

facilitate organizations to manoeuvre more professionally and construct more value.

The IT industry was not has it is now when TCS started in the year 1968. TCS

was started as the “Tata Computer Centre” a dissection of the Tata group whose

chief business was to offer computer services to other concerns. TCS marked a

tremendous growth with marking its presence in 34 countries across 6 continents,

with a absolute range of services across diverse industrial fields. TCS ranked in top

ten in the fortunes rank list for the year 2009. The concern shaped consolidated

income of US $5.7 billion for economic year ended 31 March 2009 and is listed on

the Bombay Stock Exchange and National Stock Exchange in India.

TCS expanded into China, Hungary, Brazil, and Mexico in order to incarcerate

the opportunities in financial services and services like Remote Infrastructure

management and BPO in those countries, TCS always offered a unique manner to

its global customers by positioning its brand in the worldwide market. The zenith of

all these lead to the concern’s contributions of TM Global Network Delivery

Model(GNDM) across Europe, China, India, US and Latin America as well as

incorporated full overhaul offerings, all backed by the promise of certainty of

experience for customers. By 2007, the value enunciation of “Experience certainty”

was officially initiated, acknowledged and authenticated by global customers.

As the Indian financial system sustained to grow in the new century, the

necessity for technology to constrain comprehensive augmentation became part of

national schema. TCS, which had been spending additional, time in domestic IT from

the time when its commencement was well located to assist the National

Government at the central and state level, in its inventive proposals. TCS, by its own

initiative shaped a digitized delivery system. In a manifestation of the company’s

ground-breaking spirit and with an aspiration to extend the benefits of the IT upraise

across the country. TCS aptitude to convey high-quality overhauls and resolutions

are matchless. It is the world‘s first organization to accomplished an enterprise-wide

Maturity Level 5 on both P-CMM and CMMI, using the most meticulous assessment

methodology - SCAMPISM. TCS Integrated Quality Management System integrates

process, populace and technology maturity through various ascertained frameworks

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and traditions including ISO 9001:2000, IEEE and SW-CMM, CMMI, 6-Sigma and P-

CMM.

For maximum flexibility, speediness, and competence, a vigorous IT strategy

is essential. TCS contribution facilitates companies to construct the most of their IT

investments from providing system testing solutions, application development,

management services, and integration solutions.

COMPANY BACKGROUND:

TCS has the wide spread economical boundaries around 36 countries

with seven physical centres of operations around the world. TCS was founded by

Tata group which was established by jamstji Tata in 1868 an oldest and respected

group of companies in India. The First chairman was Jahangir Ratanji Dadabhoy

followed by Nani Palkhivala. The first general manager was F.C. Kohli.

TCS first assigned to offer punch card services to a sister corporation, Tata

Steel (TISCO). It later bagged the nation's first domestic software project, the Inter-

Branch Reconciliation System (IBRS) for the Central Bank of India. It has also

provided bureau services to Unit Trust of India; as a result TCS became one of the

first organizations to tender BPO services. In 1970s; Tata Consultancy Services in

full swing exporting its services. TCS's inaugural global order came from Burroughs,

one of the first business computer manufacturers. TCS was assigned to write code

for the Burroughs machines for numerous US-based clients. This knowledge helped

TCS to bag its first onsite project - the Institutional Group & Information Company

(IGIC), a data hub for ten banks, which served to two million clients in the US, TCS

was assigned to assert and upgrade its computer systems. TCS holds the credit to

set off the first software research and development centre, the Tata Research

Development and Design Centre (TRDDC) in 1981and in 1985 the first client

committed offshore development centre was established for Compaq.

Early 90’s was golden era for the Indian IT industry; they grew tremendously

due to the Y2K virus and the introduction of Euro. TCS lead the way for industrial

unit replica for Y2K conversion and built-up software tools which undertook the

automatic conversion process and facilitated third-party developers and customers to

use. In 1999, TCS fortified the opportunities in outsourcing the E-Commerce and the

connected solutions and set up its E-Business division with ten people. In 2004 it

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illustrated a vigorous development of contributing half a billion US dollars to TCS’s

total revenue.

In the year 2004, TCS was ranked under public sector, though much later

than its competitors such as Infosys, Satyam and Wipro. TCS entered into a brand

new area of IT services (Bioinformatics). The next two years that followed TCS aced

a huge growth in progress both nationally and internationally.

TCS assists some of the world’s major MNC’s to take up the accurate

technology-enabled solution that helps them:

Optimize business recital

Decrease product progress time

Get better product differentiation

Smooth the progress of arrangement of business with technology

Join their extensive supply chains

Offer real-time business handy

Lesser functioning costs.

Tata Consultancy Service Profile:

Type: Public BSE: 532540

Founded: 1968

Headquarters:

TCS House, Rave line Street, Fort, Mumbai

- 400 001 India

Key people:

Ratan Tata, (Chairman of the Board, Tata

Group)

S Ramadorai, (CEO and Managing

Director)

Jobhi Mahalingam, (Executive Director

and CFO)

N Chandra, (Executive Director, COO, CEO

& MD Designate)

Phiroz Vandrewala,(Executive Director

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and Head, Global Corporate Affairs)

Ajoy Mukherjee, (Vice President and

Head, Global Human Resources)

K Anantha Krishnan, (Vice President and

Chief Technology Officer)

Services:

Information Technology Consulting, IT

Services, Outsourcing, BPO, Software

Products

Products:

TCS Bancs, Digital Certification Products,

Health-care Management Systems.

Revenue: US$ 6.019 billion (in FY 2009-10)

Net income: US$ 1.128 billion (in FY 2009-10)

Employees: 150,000 (As on 1 April, 2010)

Website: http://www.tcs.com

FINANCIAL POSE:

TCS financially persists to demonstrate the steady stand in the top position of

Indian IT firms. As the IT outsourcing market records more rapid growth pace, TCS

expressed a steady growth rate in 2008-09, whose consolidated revenue grew by

23% to 27% which helped TCS to cross the $6 billion revenue milestone. TCS

operating margins improved to 23.73% by 109 basis points.

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Source: squibd.com

TCS have also increased its dividend share to Rs.14 in the last financial year.

The TCS directors have also recommended an issue of bonus shares in 1:1 ratio

and it was the second bonus issue since 2004. TCS completely focused in helping

their customer’s relationship with them simultaneously adding fresh customers and

penetrating in novel market segments and emerging verticals which made them to

add 163 new customers internationally in the past year. TCS’s foremost market

North America crossed new high point of revenue above $3 billion and grew 26% in

2008-09 in spite of recession, While Europe’s branches faced a express growth of

38.5% during the same year. It is very significant for an organization to certify the

differentiation of its revenue stand and to uphold its augment impetus.

TCS always delivers that the 143,000 TCS employees are the supreme

assets of all which includes 50,000 global associates from 67 countries and TCS

trained 93,000 software professionals of which, 22,000 college graduates in the past

academic year which was tremendous growth. TCS is incessantly investing to unlock

new markets and services which made them to invest in emerging markets like

Middle East, Asia-pacific, Africa and Latin America. The firm’s gigantic team of

human resources is serving the TCS’s panorama not only in business but also its

contact on the community. TCS made an effective evolution in corporate

sustainability.

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Source :( squibd.com)

TCS persists to be a pioneer of growth for the reason of its established ability

to reinvent the business and organisation. The concern is placed to exert in

collaborative mode, significant assessing all that TCS does. TCS holds a strong

position in the future IT global market.

ORGANIZATIONAL STRUCTURE:

“A basic structure distributes responsibilities among the members of a

company. Its purpose is to contribute to the successful implementation of objectives

by allocating people and resources to necessary tasks and designing responsibility

and authority for their control and coordination” The three levels of organizations are

technical level, managerial level and the community level. (Mullins, 2008) The

organizations are differentiated based on the task, the employees work and the

nature of company and its HR policies and conditions.” A hierarchy is handled in

order to treat people equally in companies; Treating equal is just that they are

literally equal, In order to extract best from an employee, the person above him will

treat them as one and the same to extract the maximum and best work from them

Functional organization, matrix organization, and line organization are three common

types of organizational structure” (Mullins, 2008). The main intention of organizations

is to distribute the tasks; the main aspect is to preserve the relationship between

employees of different stages in order to drive them towards the single task and to

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monitor the progress of the assigned task. The TCS have a very well designed

organization.

The organizations can be classified into two main divisions they are

Centralization.

Decentralization.

Centralization

A simple and effective execution

of policies for an entire

organization.

Gives a reliable approach over the

organization.

Makes trouble-free organization

and administration control

Better employ of specialization

including better amenities and

paraphernalia.

Decentralization

Facilitated verdict is to be nearer

to the operational level of work.

Amplified receptiveness to local

conditions.

It persuades inspiration and

confidence of the staff.

Observance progress in

compliment and more supple

structures.

TCS offers services in eight areas of service: Business process Outsourcing,

Business Intelligence and performance Management, Enterprise Solutions (CRM,

ERP, and SCM) IT Consulting, Application Development and Maintenance,

Engineering and Industrial Services, IT Infrastructure services, Testing and quality

Assurance. TCS’s are divided in following divisions Financial Services, Energy and

Utility, Banking, Life sciences and Health care, Insurance, Securities trading system,

Retail and Consumer goods, Telecommunications, Government and Transportation.

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TCS follow a standard organizational growth which helps them to organize the

vast team under single board of directors; the type they follow is matrix organization.

“The matrix organization is a combination of functional departments which

provide a stable base for specialized activities and a permanent location for staff and

units that integrate various activities of different functional departments on a project

team, product, programme, geographical or systems basis” (mullins 2007).

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(www.tcs.com)

DIS ADVANTAGE ADVANTAGE

More involvement can cause

aggravation and uncertainty

among team members.

Adequate meeting makes this type

more time consuming.

A detailed understanding is

needed in order to be a part else

result in bad performance which

affects the total team work.

A very good ability is needed in

order to perform better and draw

attention.

Distribution of possessions is

supple among the organization.

Facilitates in intricate verdicts and

appropriate for recurrent

transformations occurs in

unbalanced atmosphere.

To meet demands from customers

and helps to make unity within the

team.

Provides an opportunity to extend

both practical and product skills.

ORGANIZATIONAL CULTURE:

Even though the organizational culture will look like a similar saying it’s really

solid to describe and elucidate as the word culture is derived from anthropology. In

simple it can be described as the reflection of fundamental works about the way by

which the work is performed.

“The collection of traditions, policies, value, attitudes and beliefs that

comprises an invasive framework for everything we do and believe in an

organization” (Mullins, 2008).

The corporate cultures can be categorised by two influential factors,

The degree of threat coupled with the organization’s manners

The pace at which organisations and their employees obtain comment on the

success of verdict or strategies.

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If the customs are adopted by the employees, it amplifies the supremacy and

rights of management in three ways.

Categorizes themselves with their organization and consent to its decree

when it’s the defined fascination to do.

To integrate the organization’s worth when they are right.

Enthused to accomplish the organization’s objectives.

The types of Organizational culture are Power culture, Task culture, Person

culture, Role culture.

A well-built organizational culture lies on eight strong pillars of “OCTAPACE”

referring to authenticity, confrontation, autonomy, openness trust, proactive,

collaboration and explicitness. Organization cultures can be categorized into strong

and weak cultures. The organizational culture of TCS is translucent in stipulations of

pay and its HR policies. There is a towering level of employee engagement as the

concern pay structure stimulates and supports employees to achieve better to

receive an excellent sum of their recital pay. There is an incessant improvement and

growth of workforce through different modus operandi like the T model. It is a

proficiently managed organization with client fulfilment as its top most precedence.

Workforces are given lofty sum of respect and everybody is addressed as an

“ASSOCIATE” to make them believe that their input really matters. But there are

some minorities who believe that TCS follows a cold culture, by cold they signify that

persons are not concerned about others. Few think that TCS has an energetic

culture and there are lots of communal performance which the concern takes on to

help the underprivileged and poor. One such initiative is the TCS Maitree, it is a non-

profit auxiliary of TCS which utilize the employees to approach further on and

educate the under privileged children or seize a camp in a country’s rural area to

educate them regarding the knowledge on computers. PS – T Model is new software

intended by TCS, all the workers information pertaining to his possession,

competencies, skill set, etc are fed and then the software gives the three best

domains where the employee would best be suited. This model when launched will

help in smooth inter- departmental relocates. TCS values are ethical, in which TCS

have its own set of rules, policies, values which is called “TATA Code of Conduct”

which was explained by HR with immense efforts during induction process, in easy

words it can be described as that “TCS is not doing business from people but doing

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business with the people”. The TCS’s culture is dynamic and favourable for vigorous

growth and antagonism.

THE NATURE OF ORGANIZATIONAL CHANGE:

“Change is persistent manipulate. It is an unavoidable part of both social and

organizational life and we are all subject to continual change of one form or other”

(Laurie j Mullins 2008)

There are factors which are substantial to the organization change are

Global inflation and economic meltdown.

Non-availability of resources.

The limitations on products lifecycle due to frequent revises in

technologies.

Very high competition in escalating and capturing new market places.

BUSINESS STRATEGIES:

TCS names its business divisions as Industry Service Practice. TCS has it

maximum revenue from Banking Financial Services and Insurance Sector.

GENERIC BUSINESS STRATEGY:

Low outlay of Global delivery 24X7 model.

Delivery with the help of established release and excellence

framework-IQMS in time.

A whole focus on customer retention and client relationship in order to

uphold the business revenue which is 95.6%

Distinguished in low end services in both capital and price

A solid protection from the money fluctuations with currency

prevarication.

Owing to its tough knowledge management system and resource

strength, TCS has been triumphant in attaining the cost leadership in

the Industry.

In recent years TCS has been following a further resolute strategy

where they are moving towards the requirements of customer and the

nature of business as like Middle East, Europe, and Asia-pacific. TCS

focus much on customers and the area rather than being broad.

A full Focus on the centres of Excellence(CoE) to strengthen potential

in order to build the state-of-art elucidation in particular technologies

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such as testing, virtualization and architecture. The high end skills and

scale will help TCS to embark upon huge projects aimed at converting

clients, IT applications and Infrastructures.

GLOBAL STRATEGIES:

When the global strategy of TCS is being closely observed, it will illustrate an

influencing labour cost in South America, China and some parts of Europe.

Employing overseas experts into the post of Directors in order to obtain the frequent

changes in the business is also can be referred as one of the key strategies of TCS

Clayton M Christensen(HSB Professor, joined TCS in 2006)

Dr. Ron Sommer (former chairman of the board of management of Deuteshce

telecom AG, joined TCS in 2006)

Laura M cha (Member of Executive Council of the Hong Kong special

Administrative Region(SAR) and Non-Executive Chairman of HSBC

investment, Asia ltd)

TCS have a keen view in looking US and UK for the Business Revenue

markets and India for the skilled employees. TCS is very keen in establishing

global delivery centres outside India which can demonstrate TCS as a Global

company. TCS was the first one to set the global delivery centre in China

which distinguished TCS from other corporate companies. In recent years

TCS was frequently changing its approach towards global market; recently

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TCS reconstructed its structure towards its global operations to implement a

Customer centric and integrated approach which is anticipated to assist in

avoiding the risk factors arising from the Economic Meltdown in western

countries. TCS’s operation units are mainly divided into five main divisions.

The well established markets are North America, U.K and Western

Europe and the new markets are Latin America, Middle East, India and

Eastern Europe. The new restructured plan was considered as the very good

change by the TCS as it is attaining impetus in Europe and other markets,

which is obvious in the company’s marked growth rate of 40% every year. The

operations In Middle East and Latin America had also seen a substantial

growth. TCS had built new delivery and offshore centres in Latin America like

Uruguay, Mexico and Brazil.

STRATEGIC ALLIANCES:

TCS is always keen in upholding the strategic relationships with

various International technology vendors. These relations are distinguished in

various magnitudes such as service provider, customer, supplier, and alliance

partner. The relationships with the international technology vendors have

made TCS to maintain a holistic. TCS made a joint venture with these

vendors on joint research influencing each other strengths to research and to

develop the best breed offerings.

Joint advancing engagements.

Significantly new or improved solutions.

Joint go-to-market strategies for the solutions.

ACQUISITION STRATEGY:

TCS is concentrating the growth in two ways the organic means and inorganic

means. The Inorganic way is in the course of acquisitions of companies which craft

business sense to TCS. The concerns should adjoin great value to TCS. The

Business with CMC is assisting TCS taking a very sharp gaze to the domestic

Industry. Both companies have synergies in the government sector. They made

various agreements with various companies some of them are the agreement with

the citi group to transfer 12,000 employees in banking sectors for cash and external

support in IT. Tata InfoTech Limited (TIL) was merged in early 2006. It was also a

software service company like TCS which have branches around the world like

America, Europe and Australia. Comparable to the financial venture made greater

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than, TCS yet again prolonged its banking commodities and shared its European

operations after attaining a 75% equity wager in its Switzerland-based partner, TKS-

Teknosoft. TKS was the marketing representative for TCS in Europe.

TCS: CO INNOVATION NETWORK (COIN):

TCS is following a coin strategy in order to face the competition as the

globalisation has created a elevated competition among the IT companies. It is

necessary for the IT companies in order to follow an innovative technology thus

resulted in the Advanced Information and Communication Technology which made

practicable for companies to collaborate and perform “Globally Distributed Network

(GDN)”. Disorderly improvements are not the consequence of a solitary technology

pretended by the minority of people but the combination of similar technologies may

result in getting a combined innovative technology which will be much more effective

and useful for the companies to perform globally. This concept of innovation network

is not novel; classically it was the technology releasing body e.g. IBM’s driven

Innovation Networks and Google’s Gartner Innovation networks are already been in

existence, for TCS it is the customer driven innovation network where the

participants are delivery rudiments and explorations.

SWOT ANALYSIS:

SWOT analysis is a prearranged loom to calculating the strategic position of a

business by identifying its strengths, weakness, opportunities and threats. SWOT

offers an uncomplicated way of analysing the results of marketing review. Internal

strengths and weakness are abridged as they communicated to external

opportunities and threats. (Jobbers; 2007)

It analysis the complete strategy of the company based on policies and the

business method which they follow. This pictures the company’s advantages and

disadvantages in company’s perspective.

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The SWOT for TCS is as follows,

STRENGTH

widespread universal reach

Strong economic presentation

Human management skills

Innovative lab system

The Fame of the founder

WEAKNESS

Momentous publicity to financial

service markets.

Deficient in level of consulting

operations.

OPPURTUNITIES

Expansion in worldwide IT

services

Focus on SMB segment

Expanding maneuvers in countries

like china

Focus on high end business and

consulting

THREATS

The Hike in Employee costs

Powerful competition from

overseas firms like Accenture,

IBM etc.

Merge in the end markets

Currency gratitude

Increase in competition from low

wage.

STRENGTHS:

The popularity and the reach all over the global markets made TCS a reputed

and known firm in the Global IT Market. The TCS had launched the branches all over

the world which can be considered as the primary strength for the TCS. TCS made

clear and strong economic presentations around the globe which makes its clients a

financial confidence about the company. The International base of TCS, India is

known for its skilled employees in IT field which naturally made TCS very strong in

Human resource. TCS is also skilled in the management skills as its board of

directors are from overseas countries in order to adopt the strategies from all the

parts of the world. TCS have a very good infrastructures and innovative labs with all

the latest technologies which help TCS employees to update the latest technologies

and to make research in various fields. The fame of the founder is also an added

strength for the TCS.

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WEAKNESS:

The excess exposure on the financial service markets which usually need to

be kept confidential is considered as the main weakness of TCS. TCS is also lack in

effective consulting team which show a strong reflection of decline in the growth

cycle of the TCS, Being a company which works on Outsourcing projects usually

needs a very good effective consulting team which acts as the bridge between the

clients and company. TCS really lacks in that.

OPPURTUNITIES:

TCS being a fast growing IT firm is very keen in establishing and expanding

its business to almost all the parts of world right from India, China, Latin American

countries, Asia-pacific and etc which opened up a great business opportunity for

TCS. The Focus in the SMB segments is also lays a very good business opportunity

for TCS. Expanding the global branches to void countries like china, Asia-pacific will

extend the business opportunities of TCS in future. TCS have a very good

opportunity in high end business and consulting in the future if they rectify their

weakness in consulting service.

THREATS:

The rapid growth and development in India and other global areas, A common

demand for employees arise which result in the increase of cost for employees. TCS

has to face a very high competition from overseas and well established companies

like IBM, Accenture and etc. The complete merge in the End markets is also a

biggest threat for TCS. The advantage on rupees always stands as the biggest

threat to all IT companies in general. Increase of competition from low wages is

another threat. The similar Indian firms like Wipro, Infosys are also at their full phase

of capturing global markets. TCS has to face a cold war against the threats which the

company faces. As all the competitors of TCS are equally strong and effective in

which TCS can’t ignore the supple one.

PORTER’S ANALYSIS ON TCS:

Porter’s tool will help to analyse the main five competitive factors which affects the

company’s growth

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(“www.emeraldinsight.com)

Being TCS itself is an supplier, it do not have problem with the suppliers, the

other four forces which are problematic to TCS are the threat of new entrants, the

bargaining power of customers, the threat of substitutes and the spirited rivalry

between the existence.

In the untimely days the software exports, the software wholesale market was

overlooked by very few massive like Accenture, EDS and IBM, where the Indian

concern were outlined as small level companies in result the TCS and other Indian

software companies competed themselves in the lower end of the business, which

resulted TCS and other organizations to choose small projects and tasks which are

simple to do.

TCS also faced a customer market that was conquered by the insurance

companies and huge banks. While TCS keenly hunted for alliances with larger

sellers as a competitive strategy, TCS most successful approach was to honestly

loom clients and admit the minor charges that its competitive pose dictated.

The entry of new companies have reduced rapidly as the huge companies like

TCS, Infosys and Wipro have developed and grown huge in their market share, size

and reliability with their customers. Though, the companies struggle to decrease their

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straight rivalry through demarcation of manufactured goods, in every market there

has been enormous competitors.

TCS has to work seriously upon reducing the bargaining power of customers.

TCS can prevent price strategy in mixing up with purchase decision. It means that

TCS should bring more than undifferentiated indoctrination by moving up the cost

sequence. Such approach might be difficult in the software outsourcing business as

the clients have an in-depth domain enterprises and rights of inclination to hold on to

the work allocated under considered consulting. The clients very well know that the

complete bargaining power lies in the strategic consulting; outsourcing that may

reduce their bargaining power. TCS have to build up enough knowledge so as to

construct outsourcing these errands a convincing worth plan. Of course, it is exactly

in this empire that the multinational outsourcing firms such as Accenture, IBM, and

EDS are the most vicious customers.

Falsifying groupings are often viewed as a superior approach to offset client’s

bargaining command. Though, constructing alliances with companies functioning in

client’s sites have to be low-priced as this would advance focus on TCS in

application progress. On other side, the attainment of a medium-sized US firm with

sturdy customer relations and domain expertises could offer a striking opportunity.

Even if expenses per employee would increase, the go up would be minute since

workers needs are lesser for higher value-added jobs.

The main anxiety for TCS is opposition from existing companies like Wipro,

Infosys and CTS as it has produced rivalry for active dealings and twisted

noteworthy pricing stress. Internationally, Companies like EDS have sited

themselves as competent of handling huge, “turnkey” ventures which can distinguish

themselves from contestants such as Accenture and IBM that spotlights on superior

value-added jobs such as consulting. This proposes an organically-driven expansion

strategy for TCS: as TCS should persist to do the similar sort of job that it presently

do, but should attempt to arrest a better section of the value-addition by accepting

huge projects. Although it has exhibited a potential in distant project management,

TCS would be requisite to increase the same capability.

But, there are also few risks which prevail in this strategy. TCS’s huge

dimension implies that it might have already exploited wealth to amount in

applications improvement. Adding to that, the strategy may tender the latent for huge

growth since it essentially engages elevated value-added actions. Before, this was

hard, partially owed to the technical complexity in rejecting the value-chain away

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from the modularization of appliances programming. In recent years, though,

systems design, manufacturing services, and systems integration job have

increasingly been outsourced suggestive of that, if the abilities are at hand, those

works could be completed in India.

The threat of substitutes are mainly from the China, Philippines and eastern

Europe which emerge as a biggest threats to the Indian IT companies, which is

mainly due to the low cost. The companies from these countries quote very low price

for the same quality of products as the Indian Companies do, which creates a great

impact on medium to long term projects. It is difficult for TCS being operated from

India to attain the organic growth.

As the globalization is at its peak growth TCS view on competitors should be

broad and effective. The domestic competitors itself is capable of offering a strong

competition for TCS.

The uncontrollable fact that IT companies face globally in the competition is

the bargaining power of customers as the increase in the competition and

globalization resulted in the production of quality products with low price which finally

makes the customer to gain the maximum profits. As the IT global market is broad

with very high competitors it is unavoidable to prevent the new entrants into the

market. The TCS may not have competition in the domestic market but globally TCS

is still viewed as the company which works low- level projects.

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PESTEL ANALYSIS:

Pestle analysis will analyse the organizations political, economic, socio-

culture, technological, Environmental and legal analysis of organizations. The TCS

being a Multi National company, these changes will affect the company’s strategies.

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Political:

The three major revenue zones of TCS are US, Europe and India. The

political structure in India is constant as the ruling party started to rule again after a

majority win in the 2009 General Election which is a positive view for the company as

the political influence will remain constant in this zone. In US the government had

announced a new rule on outsourcing as the companies which outsource the work

outside US; they will not get the Tax benefits which even creates a negative phase.

TCS is very well established in US as it can work from US itself, But even then the

ratio of outsourcing the new projects will be much reduced in future. The government

organizations and PSU had decided to give more domestic projects to TCS which is

positive strategy.

Economic:

The Steady fluctuation in the International market and the fluctuation in the

country’s currency rate are considered to be the major negative influences. The

Global meltdown which paused the IT’s vigorous growth had reduced the IT

business internationally. But even then the TCS and other firms where managed to

maintain their breakeven profits. The Domestic Markets had grown by 20% and

approximately reached USD 25 billion in 2009-10 which was estimated by

NASSCOM which is an advantage for the Indian companies in order to maintain the

equilibrium. The crash in the Real estate market is also considered as one of the

advantages for the companies as they can buy sites for new branches for lesser

rates and the reduction in the Rental costs. The rapid increase in the complexities in

IT Industry, the new innovative services and products from competitors. The new

competitors entering the IT market is not a very big threat but also to be taken in

account.

Social:

English is taken as the official language of TCS which made the organization

to make the business dealings with the English speaking nations like US and

Western Europe. The manpower available in India is an added advantage for the

Indian IT firms. The availability of Technicians in India is bit more than the resources

available to the other countries. India is going to lead the next twenty years of spam

for holding the highest working population globally, which is a major advantage for all

the IT companies. The recent job cuts in US and other European countries where

TCS widen their business boundaries which lead to give new job offers to the native

peoples, which created a soft bond towards the company. The availability of high

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quality manpower globally, the frequent and rapid transform in consumer lifestyles,

the improvement in the relationships between the clients.

Technological:

India is considered to be a well developed country in the telecommunication

field which provides the lowest call rate(1-2 US cents)which makes Indian firms like

TCS to thrive high in the field of BPO, as the core of these business is to

communicate among customers and company representatives. India holds the

largest population with mobiles and an average population expected to have the

subscriber base of 503 million the end of 2010. TCS holds its global head quarters in

India which has the highest telephone network after china.TCS is much more

concentrating in the next generation on wireless which the global technology is

attracted towards that.

Strategic Partners

Microsoft - Global System Integrator Partner

IBM - Global System Integrator Partner

Oracle - Global System Integrator and Global Certified Advantage Partner

SAP - Global Consulting Partner

Growth Engine Partners

Siebel - Consulting Partner

SUN - System Integrator Partner, GSS Partner

BEA - TCS is BEA’ Strategic Partner

Web Methods - Global System Integrator, Preferred Offshore Partner

Legal:

IT firms in India is frequently facing the legal issues from the employees and

other mutual competitors, Each Indian IT Company is extended their boundaries

globally and have their own global HR policies, all the IT companies including TCS

have undergone the issue of legal bonding made to make the employee to stick into

their companies for long term which is an negative aspect on TCS. Except in US

TCS is getting tax benefits globally.

Environmental:

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The Environmental concern of TCS shoots from the Tata Group which is also

added in the “Code of Conduct”. TCS considers the change in the climate is

considered as the main aspect which affects the economic stabilities. TCS is much

more concentrated on the environmental issues like global warming, energy

utilization, water consumption and etc.

FUTURE PLANS:

TCS UK division and its subsidy is focusing on the Insurance market in the

BPO, the Diligenta’s deal with the pearl conformed their future plans of entering into

the Insurance Industry. TCS is planning to expand further in the globally in order to

capture new markets like China, Philippines, Asia-pacific, South America, Mexico

and Eastern Europe. TCS has invested around INR 500 crore in India in order to

develop its domestic infrastructure within India. TCS has invested around approx 150

billion in order perform research on next generation technology and wireless

"We are strengthening our product line-up to position the company for the

future, (Mr.Ramadorai, CEO)”. As the CEO of TCS said TCS has invested an

respectable amount of money in order to strengthen their product line-up

RECOMENDATIONS:

The first and prior recommendation is to change its vision statement as it

views and felt like a short viewed, as TCS should need a vision which reflects

vigorous thinking and enduring thinking. Anticipate observing the site persist to

merge. Customers will hunt for reducing expenses and focus on less supplier

relationships as the market deteriorates. TCS should take this occasion to get better

its market positioning. Certify promotion communicative it’s worth intention to all

stakeholders fretful led. In market Meltdowns, marketing can work as a differentiator.

TCS should alter focus from Low cost advantage to high quality services imposing a

quality being the initiator in the industry. Offer more high-end works in price chain.

Rapidly adjust and expand client assurance in high growth markets. In Financial

Year 2009, Indian home market grown by more than 20%, as well as TCS income

from India augmented only by 6.46%. TCS should influence its success (IRCTC

success done by its subsidiary – CMC, Passport project etc.) to constrain the

augmentation in this market.

TCS should not be influenced exclusively by short-term shareholder pressure.

The depression is at the top of each company’s schema, but those suppliers that

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receive a long-term outlook will employ this occasion to organize for the primary

modifications in business dynamics that will appear. Those suppliers geared up for

the recent ecosystem will be the ones to prosper once the dark part of economic

chaos have lifted.

CONCLUSION:

TCS founded as the small computer centres now emerged as a very big multi-

national IT company in the span of 40 years. TCS which is considered as the one of

the oldest and biggest MNC from India is still growing in the spot-light with a new

dimension. The roots of TCS are also can be taken in account for this massive

growth. The growth of TCS in global market creates a positive impact on India and

Indian economy.

REFERRENCES:

David Jobber (2007) 5thEdition edn. Principles and Practice of Marketing. : Mc

Graw-Hill Education.

Laurie J.Mullins (2008) second edition edn. Essentials of Organizational Behaviour.

England: Pearson Education Limited

Open university (1993) ed. by Christopher Mabey and bill mayon-white Managing

change. England: Paul chapman publishing ltd

Robert A.Paton and James McCalman (2008) Change Management-A guide to

effective Implementation. London: SAGE publications limited

Esther Cameron and Mike Green (2004) 2009 edn. Making Sense Of Change

Management. London: Kogan page limited

George Blair and Sandy Meadows (1996) A real life Guide to Organizational

Change. Hampshire,England: Gower publishing Limited

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