Business Strategy of Tata Consultancy Services (TCS)

telephone circuit St grazegy of Tata Consultancy function (TCS)TATA meeting of companiesTata Group of companies is the wallopingst private somatic pigeonholing in India and has been recognized as one of the closely respected companies in the world which was founded by Jamsedji R Tata in 1991. The play along has operations in more than 85 countries across six continents and its companies export harvest-times and ply to 80 nations and the Tata Group comprises (114) companies and subsidiaries in seven clientele sectors (Tata Sons Ltd., 2010).SBUs of TATA group For details disport impact to appendix none1)SBUs which form a major part of the Tata group includeTata steelTata motors Ltd.Tata consultancy functionTata TechnologiesTata teaTata powerTata CommunicationsTata Tele workTata hotels1.1 follow profile Tata consultancy serve (TCS)SBU of Tata grouphttp//t2.gstatic.com/images?q=tbnftrqMPzMyAWhIMt=1usg=__pSSLT1wgbnRMMkApfc8zl-8DYsg=Source http//biet.beadvg.org/images/lo gos/tcs_logo_cmyk.jpgTata Consultancy function (TCS) is one of the SBU of Tata group of companies. It is a Softw ar operate consulting family which is a subsidiary Tata group .It is the largest provider of information engine room (IT) and concern wait on outsourcing services in Asia. It has offices in 42 countries with more than 142 branches across the globe. The fellowship is listed on the National Stock Exchange (NSE) and Bombay Stock Exchange(BSE) of India.TCS generally offers a consulting-led, integrated portfolio of IT and IT-enabled services delivered through its unique strategicalal Global network Deli very(prenominal) Model which is recognized as the benchmark of excellence in the IT industry (LinkedIn Corporation, 2010) .TCS is currently investing in sweet technologies, sassyborn processes slew in drift to achieve an competitive edge (Amdocs Ltd., 2010).(For details revel touch on to appendix no.2)TCS serves some of the worlds largest companies to adopt the right technology-enabled solution that helps them in following manner (Tata Sons Ltd., 2010).Optimize credit line performanceFacilitate colligation of vocation with technologyConnect their extended supply chains ever soywherecome product development timeImprove product variousiation result real-time rail line insight low-downer operational embodyTCS business structureFollowing diagram illustrates in operation(p) structure of TCS figure 1.TCS operating structureSource http//www.allbusiness.com/glossaries/organizational-structure/4943569-1.html2 pipeline Level StrategiesTCS has developed its business take dodge by assuming as world pecuniary institutions are in a tremendous shock of crisis and think of marking up revenue from other industries. (Tata Consultancy Services Limited, 2010). TCS names its business divisions as Industry Service Practice which testament help them to collect uttermost revenue from Banking Financial Services and Insurance Sectors. (Please carry on to appendix no. 3)Generic Business Strategies of TCSTCS provides low cost Global deliverance with the help spheric dodge.TCS mainly focal point on customer relationship worry customer retention in order increase the business revenue.TCS provides swell timed(p) delivery of IT services with the help of proven delivery quality fabric called as (iQMS)TCS uses differentiation scheme by providing low end services in damage of cost, resources.TCS besides diffenciate its high end services much(prenominal) as consulting in term of niche offerings.TCS has hale knowledge guidance system resourceStrength by which they has successful in arriver the overall cost leadership in the (IT) industry.TCS has develop a undaunted dodge where they are providing (IT) services according to the requirements of customer and the nature of business. targeting new markets alike(p) pump East, Europe, and Asia-pacific.Currently TCS Focus on Centres of Excellence (CoE) to commit ability so as to construct technologies such as service-oriented architecture, testing, and virtualization which will help TCS to attempt outsized projects so as to alter customers (IT) applications.Business level scheme modelFollowing diagram illustrates various business level strategies of TCS which are closely related to the company.Fig 2. Business level system model-TCSSource AuthorBusiness level Strategies are listed down the stairsGlobal Strategies strategical Alliance dodgeAcquisition strategyTCS Co innovation network (coin) strategy(1) Global strategyTCS global strategy structure tend towards its global operations to implement a node centric and integrated approach which will help them to control extraneous factors arising from the Economic Meltdown in western countries. TCSs global operation units is change integrity into five main divisions includes the established markets like North America K Western Europe as well as the new markets includes mainly Latin America, Middle e ast, India and Eastern Europe. TCS was the first one to set the global delivery centre in China which distinguished TCS from other merged companies (Mitra, 2005).This global strategy of TCS will Increase Companys market growth rate at the rate of 40% every year. TCS is establishing global delivery centres external India which demonstrate TCS as a Global company. In recent historic period TCS was frequently changing its approach towards global market. (For details enthrall refer to appendix no .3)Global strategy functionFollowing map illustrated the countries where TCS collaborate its global strategyMainly includes US, Mexico, China, India, Hungary, UK, West-Europe etc.http//htmlimg3.scribdassets.com/entwg1s84irfuww/images/15-8f526c1a8f/000.jpgFig.3 Global strategy mapSource http//www.cogmap.com/chart/tata- consultancy-services2 Strategic Alliances strategyTata consultancy services curb been holding a strategic relationship with various external technology (IT) vendors such as Intel, Hewlett-Packard (HP), IBM this distinguished as service provider, customer, supplier, and hamper partner. (Mitra, 2005). The relationships with the international technology vendors catch make TCS to maintain a holistic approach to create a joint venture opportunities with these international vendors on joint research by which each others strengths will provide a strategic advantage by following ways(For details please refer to appendix no.4)It creates joint engagements with (IT) vendors.It provide new or improved solutions on problemsIt helps to adopt a Joint go-to-market strategy for the specific (IT) solutions.3. Acquisition strategyTCS divides its acquisition strategy into two components. Organic subject matter and inorganic means (Mitra, 2005). The Inorganic way of acquisitions of companies this has business sense to TCS as part of its strategy to look at expansion options has set up an internal police squad which will focus only on acquisition strategies.(For detail s please refer to appendix no.5)4. Co- innovation network (coin) strategiesTCS have implemented a Co-innovation strategy in order to face the argument in todays globalisation world. Where competition among the IT companies is increasing day by day. TCS has developed implement an progressive technology which will result in collaborating a Globally Distributed mesh (GDN) (Mitra, 2005). (Please refer to appendix no.6)Bowmans strategic clockBusiness level strategy of TCS screw also be explained with the help of Bowmans Strategic clock (work of Cliff Bowman) (For details please refer to appendix no.7)Fig 4. Bowmans strategic clockSource Adopted from (Faulkner Bowman, 1995)Based on the competition faced by TCS they are using two parallel strategies so as to sustain in the (IT) sector.Differentiation-TCS use differentiation strategy by offering its low high end services such as consulting in term of niche offerings terms of cost resources. expertness that is different from those of the competitors in (IT) industry which are pryd by the customers.Low price-TCS has achieved cost (price) leadership in the (IT) industry with the help of its strong knowledge management system as compare to competitors.According to Bowmans strategic clock differentiation Low price strategy comes under hybridizing strategy. So, it is evident that TCS use these strategies in order to keep up with the emergent (IT) trends and working out towards its goal of beingness the most chosen place in the (IT) industry.TCS Business level Strategies can also be set and explained with the help of Ansoff hyaloplasm which divides the strategy of a company into four different categories namely,(i) marketplace Penetration Strategy(ii) Market maturation Strategy(iii) convergence Development Strategy(iv) Diversification StrategyTCSs growth and development strategies ground on Ansoffs matrixAnsoffix growth matrix For details please refer to appendix no.8)TCSS Business level Strategies can also be place and explained with the help of Assnsoff matrix as follows animated Products overbold Products(Market Penetration)Existing Markets regular army and EuropeExisting Products ADM, BPO, KPO, consultancy services software products.(Product Development)Existing Market regular army and Europe recent Product Consultancy and package implementation services in relatively growing sectors life sciences healthcare, breeze sector, and KPO services(Market Development)New markets India, Middle-east and AustraliaExisting Products ADM, BPO, KPO, consultancy services Software products (financial products).(Diversification)New productsvertical- Specific services packages, TCS Financial Solutions, and Platform- launchd BPONew markets Latin America, Eastern Europe, Middle East Africa and India),Existing MarketNew MarketFig 4. Ansoffix growth matrix of TCSSource Author(i) Market penetration strategyAs per the growth matrix TCS is currently penetrates its cranial orbit of services i nto USA and Europe where they provide ADM, BPO, KPO, consultancy services (in BFSI, manufacturing and retail firms) as well as they provide software products (financial products) to the firms as most large clients in US and Europe are concentrating on cutting costs of (IT) related services (Tata Consultancy Services Limited, 2010). TCS require to be more offensive on cost cutting strategy with good quality.(ii) Market development strategyAs per the growth matrix TCS is concentrating on new markets like India, Middle-east and Australia where they provide products like ADM, BPO, KPO consultancy services (in BFSI, manufacturing and retail) and software products (financial products) (Tata Consultancy Services Limited, 2010).Since these are the most fast developing IT market where TCS needs to keep a epitome as a shift in focus from US EU markets to these new markets.(iii) Product Development StrategyAs per the growth matrix TCS is selling its new products such as Consultancy and pack age implementation services in relatively growing sectors especially in life sciences healthcare, aviation sector, and KPO services into existing markets like USA and Europe (Tata Consultancy Services Limited, 2010). This strategy will definitely help on building expertise in these domains by strategic acquisitions.(iv) Diversification strategyAs per the growth matrix TCS has diversified their new products like vertical- Specific services packages, TCS Financial Solutions, and Platform-based BPO into new markets like Europe and other emerging markets where the market growth of the company has increased by 40 % (Tata Consultancy Services Limited, 2010).TCS diversified its function to new markets like Latin America and Middle East for considerable expansion. In order to penetrate a new market TCS has established delivery and offshore centres in countries like Brazil, Uruguay and Mexico.3 Strengths weaknesses based on business Level StrategiesFollowing table illustrates (TCS) streng ths and weaknessesStrengthsWeaknessesExtensive universal joint eye socket severe economical performanceStrong brand name and ken remarkable service OfferingsEmployee Management Skills (HR Skills) foot lab systemFame of discontinue important publicity to financial marketsLack of focus on the domestic markets. lacking(p) in level of consultingOperationsSource Author3.1 Strengths(1) Extensive Universal reach TCS has widespread a global reach by its product and services throughout its branches all over the world includes in UK, U.S, Middle east, Australia, Europe etc. (Tata Consultancy Services Limited, 2010). This provides a diverse revenue base for the company to have an active control on its business operations universally.(2) Strong economic performance TCS has made apparent and strong economic presentations around the globe which makes its clients to be financially confident about the company and hence it will increase companys reputation.(3) Strong brand name and awareness As the popularity of the brand TCS (Tata consultancy services) has been reach all over the world which made TCS a reputed brand image in the Global information technology (IT) and software industries.(4) Unique service Offerings TCS provides a unique range of services including business consulting information technology, business process outsourcing (BPO), infrastructure, and engineering which distinguished them from competitors survive to IT industry (Tata Consultancy Services Limited, 2010).(5) Employee Management Skills (HR Management Skills) The domestic base of TCS i.e. India is well -known for its skilled employees in IT field which naturally made TCS a very strong in HR management .TCS is also recruited its board of Directors are from overseas countries in order to adopt the strategies from all the parts of the world.(6) Innovation in lab system TCS have most effective infrastructures and innovative labs all over the world with most modern technologies which help its employee s to have an access to update the most up-to-date information to make research in various IT related fields (Tata Consultancy Services Limited, 2010). This provides TCS an competitive edge.(7) Fame of founder Tata is recognised as the most renowned brand in Asia as well as the fame of the founder Mr.Ratan J Tata also added value to TCS (Tata Consultancy Services Limited, 2010).3.2 Weaknesses(1) Momentous publicity to financial marketsThe Excess exposure on the financial service markets at a global level (Datamonitor, 1998). Which generally regard to be keep confidential as they it displays companys private policies and legal terms which is considered as the primary key weakness of Tata consultancy services (TCS)(2) Lack of focus on the domestic marketsAs per the strength of TCS it has an Extensive Universal reach by its product and services throughout it are all over the world branch which provides a diverse revenue base for the company. (Datamonitor, 1998). scarcely at the same time domestic markets are also affected due to lack of focus by the company. This is the key weakness of Tata consultancy services (TCS).(3) Deficient in level of consulting operationsLack in sound consulting team which show a strong reflection of decline in the growth Cycle of the TCS, Being a company which mainly full treatment on Outsourcing on scale large projects and assignment which generally needs a very good effective consulting team which acts as the marry between the Clients and company (Tata Consultancy Services Limited, 2010).TCS company is lacking behind in its level of consulting operations.Report to the Board of DirectorsTo,The Board of Directors,Tata consultancy services Ltd.Subject Recommendations for the (TCS) business unit.Respected Board members,In the report which is attached along with a critical research and analysis has been done on the corporate strategy followed by your company. The research and analysis has been conducted by using various corporate stra tegy tools and methods and the companys past and current strategies have been highlighted.On the basis of the strengths and the weaknesses of these strategies we have stated so following are the recommendations which I was able to retrovert after studying the strategies adopted by the TCSTCS should create specific value propositions aimed directly at the relevant stakeholders which include business executives, IT personnel in order to improve your market positioning in domestic markets.The wastefulness exposure on the financial service markets which usually need to be kept confidential is considered as the main weakness of TCS so they can should focus more on increasing their IP (Intellectual Property) assets in order to lower the momentous publicity to financial markets (Tata Consultancy Services Limited, 2010).TCS can also go for isolation strategies with premium services like IT solutions and focus on a niche market.In market Meltdowns (recession) marketing can work as a differ entiator. TCS can alter its focus from Low cost advantage to high quality services considering quality being lead up in the (IT) industry.TCS can offer diverse services to refrain from being over-dependent and increasing exposure to the vulnerabilities of few sectors like USA.TCS can adopt ADM (Application Development and maintenance) system to increase value added services, BPO to Consulting and Package Implementation (Tata Consultancy Services Limited, 2010). desegregation and strategic acquisitions are essential for future growth of revenues. The HP-EDS merger (one of the biggest ever merger in this industry) is evidence to this. TCS should prepare for such opportunities which are strategic fit for the company.TCS has rightly placed SMB (Small and Medium Businesses) as a recognize strategic unit, which should be focused aggressively. They should also focus consulting practice on the same business unit (Tata Consultancy Services Limited, 2010).