Posted on 06/08/2007 10:00:03 AM PDT by CarrotAndStick
India’s largest outsourcer Tata Consultancy Services (TCS) has set up a global delivery center in Guadalajara, Mexico, with plans to hire up to 5,000 staff there over the next five years.
Having a center in Mexico helps TCS, of Mumbai, as it will be closer to U.S. customers and on a similar time zone, said Pradipta Bagchi, a spokesman for TCS said on Thursday.
The South American market also provides a significant opportunity for TCS because of a large number of regional companies investing in information technology and related services, Bagchi said. TCS currently has about 5,000 employees in South America, which service more than 150 clients there. It operates global delivery centers in Brazil, Mexico, and Uruguay, besides a business process outsourcing services center in Chile.
Indian outsourcing companies are grappling with the appreciation of the Indian rupee against the U.S. dollar, as well as rising labor costs. India’s National Association of Software and Service Companies (NASSCOM) has said that the 8 to 9 percent appreciation of the rupee over the last three months is worrisome. The United States is the largest market for Indian outsourcers.
TCS’ expansion in Mexico led to speculation that the company may be looking for alternative locations to India. Staff in India is still cheaper than in Mexico, and the company has no plans to scale down its operations in India, Bagchi said.
A number of Indian companies have set up operations in South America and Eastern Europe to offer a near-shore option to their customers in the United States and Europe.
Indian companies are also expanding in other countries to look for new talent pools, as it gets tougher to hire staff in large numbers in India. Satyam Computer Services, an outsourcer in Hyderabad, said last year it was expanding in China, Malaysia, and other locations to tap regional markets and supplement its Indian operations.
TCS and India’s second largest outsourcer, Infosys Technologies, have also set up operations in China.
China has, however, fallen short of expectations as an offshore location, according to Forrester Research. Two years ago, China was viewed as a key challenger to India because of its large number of engineering graduates and the support of the Chinese government to establish it as a key offshore location, Forrester said. But after an initial burst of momentum, there has been relatively little evidence of the country’s success, the research firm added.
TCS’ new center at Mexico will primarily offer software development, Bagchi said. The center will serve clients in Mexico and the United States, he added.
06/08/2007 08:23 AM ID: 62926
India's software giant moves jobs to Mexico
Tata Consultancy Services (TCS), India's largest software company, plans to hire 5000 employees in Mexico, even though India is presently the world's leading outsourcing center.
Rising labor cost (about 15% a year), a rapidly appreciating rupee (9.2% this year), a talent supply crunch and growing competition from other outsourcing centers are forcing some of India's largest companies to move operations overseas.
Wipro, Infosys and Satyam, Tata's rivals, have set up operations in China, where an excess supply of good software engineers has kept salary inflation low. Erosion of India's appeal is expected to continue as competitors elsewhere become mature.
Pinging...
Just doing jobs Indians won't do.
TTFN!
actually indians speak english. if they’re going to serve teh US market they increasingly need spanish speakers.
Sounds “bodacious”
Actually, I’d bet that a vast majority of these jobs are Indian programmers.
We use TCS and about eight months ago, we suggested they relocate some of our outsourced programmers to Mexico. The reasoning was that they’d be in the same time zone and would have better acces to our network resources.
Putting the programmers in Mexico instead of the US would reduce their costs and improve services.
Sounds like the Dilbert cartoon from a couple of years back. Dilbert’s company outsources to India, India outsources to China, China outsources to Mexico all in turn to cut costs and now Mexico is outsourcing to cut costs — back to Dilbert’s company in the U.S.
Is it art imitating life?
Prove me wrong.
Oddly enough, you'd have a very tough time doing that. Mexico patrols their borders VERY tightly, because they have this funny little problem of poor people coming to their country from their neighbors to the south (Nicaragua, Honduras, Guatemala and El Salvador). Jobs are more plentiful and higher-paying there, so the influx of immigrants is significant. Many do not follow their immigration laws in their zeal for a better life. Mexico's laws allow the police a LOT of leeway in turning back this flood of unwanted and undocumented workers. Reports of brutality are not uncommon.
Mexico's per-capita GDP is $10,600.
The global average is $10,000.
Guatemala's is $4,900
El Salvador's is $4,900
Honduras' is $3,000
Nicaragua's is $3,000.
(Source: CIA World Fact Book)
I have not had access to a computer until about an hour ago, so I didn't respond immediately.
Cheers!
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