Date:12/03/2005 URL: http://www.thehindubusinessline.com/2005/03/12/stories/2005031200800500.htm

Back Resource flexibility, range of services key to mega deals: TPI

Rukmini Priyadarshini

Bangalore , March 11

MEGA outsourcing deals are being struck all the time, and they mostly go to vendors offering a wide or full range of services and flexibility.

Offshoring advisory TPI has found that Indian pure-play providers are increasingly on the radar and receive `request for proposals' for a number of large deals. They compete approximately on 15 per cent of TPI-led contracts with cumulative contract values of $2.4 billion (up from 5 per cent in 2001 and contract value of $200 million) but they need to pep up their range of services and flexibility to increase their win-rate, according to Siddharth Pai, Partner.

As more deals involve the offshore component (three quarters of all deals led by TPI last year) Indian third-party providers are having to compete with large MNC firms and need to increase their competitiveness by providing a flexible approach to resource management, Mr Pai feels.

"There is a heightened competitive trend with the non `Big-Six' having an increasing market share," but the mega deals still go to the larger MNC players, Mr Pai feels. Last year, TPI enabled 17 mega deals with a total contract value of over $31.8 billion.

The outsourcing advisory has found a client-driven push for offshoring but the resource and locational flexibility offered by MNC players was strategically more important than the dwindling cost advantage of the Indian players since many MNCs are now able to offer the India factor in their equation, Mr Pai said. There is a need for India players to increase the depth of their offerings as well as have larger scale operations in more locations, he said.

TPI, the world's largest outsourcing advisory, has negotiated over 650 transactions with a total contract value of over $360 billion.