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GBM PROJECT

ON

WIPRO

SUBMITTED TO: SUBMITTED BY:


PROF.AMIT KUMAR SOUMYANI CHATTERJEE
PRASHANT KAPOOR
RIPINKU MATHUR
SHWETA BISHT
BACKGROUND OF THE COMPANY

Wipro Limited is a $5 billion Indian conglomerate. According to the 2010-11


revenue, Wipro is the third largest IT Company of India after TCS and Infosys .
Wipro Ltd has interests varying from information technology, consumer care,
lighting, engineering and healthcare business.

Type- Public
Founded- 1945
Founders- M.H.Premji
Headquarters- Bangalore, Karnataka India
Key people- Azim Premji, Chairmain, Girish Paranjpye was the joint CEO,
Suresh Vaswani was the joint CEO .Now the new CEO is T K Kurien.

1.Wipro(Western India Palm Refined Oils) started as a vegetable oil trading


company in 1947 in Maharashtra founded by Azim Premji‟s father.
2. Azim Premji succeeded his father and repositioned Wipro into a consumer goods
company that produced hydrogenated cooking oils/fat company, laundry soap, wax
and tin containers and later set up Wipro Fluid Power to manufacture hydraulic and
pneumatic cylinders in 1975.
3.In 1975 when IBM was asked to leave India, Wipro entered into the information
technology sector.
4.In 1979, Wipro began developing its own computers and in 1981, started selling
the finished product .
5. In 1980 Wipro moved into software development and started developing
customized software packages for their hardware customers .
6.Since 1992 Wipro began to expand off shore in US and by 2000 Wipro Ltd
ADRs were listed on the New York Stock Exchange .
7.First CMMi Level 5 certified software services company.
8.First company outside USA to receive the IEEE Software Process Award.
9.55+centers of Excellence creates customized solutions irrespective of domain
involved.
COMPARISON WITH THE COMPETITOR (INFOSYS)
Infosys
Founded by N.R. Narayanamurthy along with 6 other entrepreneurs in 1981.
Headquartered in Bangalore in Karnataka, it was started with a meager INR 10000.
Today it employs over 120000 people and has operations in many countries of the
world including China, Japan, Australia, UK, US, Canada and Indonesia. It is listed
in BSE and NASDAQ.
Its operating income in 2010 was USD 4.59bn and profits stood at USD 1.26bn. It
is rated as the best employer of the country. Infosys received more than 1.3 million
applications in 2010 of which it hired less than 3% of the candidates.
Differences between Infosys and Wipro Ltd.
• WIPRO employs more than 115000 people in its different operations. Its
operating income in 2010 stood at $1.144bn and the profits were $1.02bn. Though
it lags behind INFOSYS in terms of operating income, it is rubbing shoulders with
Infosys when it comes to profits generated.
• Among the two, Infosys is more active when it comes to hiring new people.
Currently Infosys is hiring nearly 6000 people every year. Wipro focuses on hiring
fresh graduates, while Infosys is more into luring professionals from other
companies.
• As far as acquiring new clients with their products and services is concerned, both
appear to be on the same platform but whereas Infosys is keep on expanding its
operations abroad, Wipro seems content with expanding within the country.
• While Infosys is listed in NASDAQ, Wipro is not.
• Infosys concentrates solely on IT, while Wipro has operations in other sectors
also.
• Infosys has business centers in many other countries
Statistics for Emerging and Current Megavendors (Service-Related Statistics Only)
Company Year Revenue (Millions of Growth Head Revenue per Employee Market Cap
End Dollars) Rate Count (Dollars) (Millions of
Dollars)

INFOSYS 2007 4,176 35.15% 91,187 45,800 23,563


WIPRO 2007 3,393 37.94% 82,122 41,310 17,388

company Last price Market Cap. Sales Net Total Assets


(Rs. cr.) Turnover Profit

Infosys 3087 177,233.84 21,140.00 5,803.00 22,036.00

Wipro 444.50 109,058.08 23,177.60 4,898.00 23,222.40


VARIOUS ROUTES ADOPTED FOR GLOBALIZATION
1.Liberalization:New Economic Policy (NEP) introduced in the country helped
the company to excel in the global market,providing variety of benefits.
2.Support of Government policies towards free trade:Export incentives and duty
concessions, which showed the company a new opportunity abroad.
3.Increased foreign investment:The increased foreign investments in software
technology parks ensured growth in further coming years.
4.Change in policies:Many economic policies changes in the country helped
Wipro in their growth. At that time the new policies were going in favour of the
whole software industry.
4.Exchange rate:High exchange rate helped the Company to take an advantage
over other global players which actually allowed it provide products and services
at lower costs.
5.Improvement in the technology :It helped to access to the business partners
including various suppliers and customers very easily.
6.Import and export:Wipro's power cylinder business grew at a similar rate as its
hardware business, and kept the company well poised to benefit from any boom in
future infrastructure expenditures. In 1998 Wipro started exporting hydraulic
cylinders throughout Southeast Asia. Also, a lot of synergies existed between the
medical systems and IT businesses within Wipro. Wipro GE emerged as the largest
healthcare systems company in South Asia in 1998, and in that same year, became
the top exporter of such systems in India.
Given that 60 percent of India's IT-related services and software exports were tied
to the U.S., Wipro's unscathed emergence was remarkable. By the end of March
2001, the company's net income hit a record $138 million (up 106 percent from the
previous year), and operating margins grew from 18 to 24 percent that same year.
While revenues from U.S. clients declined to 64 percent from 70 percent, revenues
from Europe climbed from 24 percent to 29 percent, and revenues from Japan did
the same from 5 to 6 percent.
7.Performance of services
During 1990’sIndia quickly became the third-largest supplier of IT labor, and its
communications infrastructure rapidly improved. Part of this growth was driven by
a growing number of U.S. corporations that began to tap into the cheap IT labor
market in India, often for 40 percent to 60 percent less than the cost of U.S. labor.
As a result, Wipro typically contracted out teams of engineers to work at U.S.-
based companies.
8. Strategic alliances
In its sixth acquisition in seven months, Wipro on Thursday said it has acquired
the Finland-based Saraware Oy in an all cash deal worth $32 million.
WIPRO’S FDI HISTORY AND NEW TRENDS
1.The Foreign Investment Promotion Board (FIPB) had given its nod to Wipro
for designing, developing and manufacturing defence-related software and had
further referred the matter for the Finance Minister's approval.the major issue
related to the proposal was whether IT companies who want to get into defence-
related activities will be subjected to the cap of 26 per cent on foreign direct
investment, as is the norm in the sector.Wipro, which already has foreign
institutional investment of 9.8 per cent, had been advised by the MoD to take FIPB
permission before applying for a licence.Under the current FDI norms, software
companies with 100 per cent foreign equity can set up shop in India through the
automatic route and can offer software services in defence.However, a separate rule
says FDI in the defence sector is only permissible up to 26 per cent.However, the
Department of Economic Affairs and MoD have supported the proposal.
2.On 16th Feb, Wipro announced the inauguration of a new office in Mississauga,
Ontario, as part of an expansion plan for its Canadian operations.
3.Qatars's Doha Bank looks at collaboration with Wipro.A statement from the
bank, following a meeting of its senior officials with Wipro chairman Azim
Premji , said both sides will focus on a stronger alignment that leverages Wipro's
global and regional expertise. Presenting the strategic information technology
needs of the bank to Premji and his regional team, Doha Bank CEO R Seetharaman
said the bank "expects value addition from Wipro on its e-commerce gateway.
Doha Bank will also need specific solutions on SME segment from Wipro. We
would also consider potential collaboration on education segment with Wipro."
He said that Doha Bank would like to leverage Wipro's expertise in the UAE and
Kuwait and may also roping in Wipro for technology support with respect to call
centre enhancements, the bank's global framework on risk management and
insurance solutions.
UPCOMING EVENT
Wipro bets on BFSI, healthcare: Having fallen behind its peers in revenue
growth, Wipro Technologies now says it's “chasing hyper growth” through
select verticals . Spaces like banking, financial services and insurance (BFSI),
healthcare, retail, manufacturing and utilities have been identified as high-
growth verticals for the company. The company's new CEO, T K Kurien, who
is at Nasscom's Leadership Summit here, told TOI, `` We are looking at growth
from all quarters, but we expect hyper-growth in these select spaces. The
healthcare and BFSI verticals will be key focus areas. Compared to last year,
market volumes have increased this year and there is quite an uptick in the
market.'' Healthcare and BFSI are verticals where close rival Cognizant also has
a strong footprint. Talking about the recent organizational restructuring , he said
the objective was revenue and topline growth, not cost cutting
ECONOMIC,POLITICAL-LEGAL ISSUES FACED IN
INTERNATIONAL BUSINESS
1.Movement of Employees:
• Immigration & Visa Issues
• Universal Recognition of Qualifications, Experience and Training
• Employment laws enforcing local hiring
• Social Security Tax
2.Government Regulation on Business Entity & Vendor Selection:
• Structure of Entity (Branch, JV, Fully owned
Subsidiary etc.)
• Restrictions on Foreign Investments & Local
equity participations
• Remittance of foreign exchange
• Staffing & Management conditions
3.Other challenges

• Macro environment related


• Business model related
• financial
They have been less focused on Brand and more on sales.But offlate the need for
brand was Realized by them and started to campaign“APPLYING THOUGHTS”
According to Girish S Paranjpe:-1.Key issues that were addressed included
reduction of costs in the short term, maximizing in-quarter revenue and minimizing
complexity that influences the strategic imperative for open and collaborative
business models and as day-to-day risk and uncertainty dominate corporate
priorities.
2. Another key thing was that the gloom and doom in a few sectors was coloring
the world view of everyone. So though there are some sectors and economies
which are doing well, the overall climate was very somber and grey. Every sector
was echoing the sentiments of the financial sector even though the downturn has
not really affected them. A key point here, that I would like to make, is that we
have stopped challenging and questioning. We need to peel the layers and see the
opportunities the current environment gives us.
CROSS CULTURAL ISSUES FACED IN MANAGING
INTERNATIONAL OPERATIONS

An example that illustrates cross cultural issues faced by WIPRO employees.


Vivek Paul was hired to run the IT division of a global company that originally
sold cooking oil. A native of India, he was educated and had worked in the United
States for many years. Paul was brought on board to develop Wipro Technologies
into a leading provider of software services to the world's largest corporations. He
faced a number of challenges in achieving this goal. His most immediate challenge
was attracting, developing, and retaining key talent. Paul needed someone at the
helm who had established relationships and credibility with the employees at Wipro
Technologies' Indian operation centers. He wanted someone who knew the Indian
corporate culture and who had the cross-cultural sophistication that comes from
extended expatriate experience to be the director of Wipro Technologies Europe.
Sudip Nandy was the perfect fit for such an assignment. This story illustrates the
cultural challenges of transforming an Indian company in order to enhance its
global effectiveness. The A case (UVA-OB-0755) discusses some of the methods
Wipro used to leverage diversity in the workforce to create competitive advantages
for the firm. The B case further describes some of Nandy's ideas for business
growth. In the C case (UVA-OB-0778), which updates the business situation to late
2002, Nandy reviews more strategies. This case series illustrates the importance of
national culture and ethnicity issues to everything a large corporation does,
including its own culture of origin, the cultures of its potential customers, and the
cultures of its employees
DIFFERENT STRATEGIES ADOPTED
BUSINESS LEVEL STRATEGIES
 COMPETETIVE STRATEGIES
1.Technological excellence.2.Innovative solutions.3.Operational excellence.
4.Global footprints
 COST LEADERSHIP
 FOCUS
MARKETING STRATEGIES
1.Planning to aggressively develop the R&D services by focussing on high growth
markets Dedicated sales team for Europe and Asia .
2.Focused on New Client Acquisition in Europe & Asia .
3.Wipro’s own website is the fulcrum of the entire lead-generation program .
4.Consciously focused on increasing the revenue contribution from higher-end
service lines .
5.Special offers and more than 400 case studies to get visitors to demonstrate and
register their special interests .
6. Comprehensive Web monitoring .
7. Wipro uses permission marketing to strengthen relationships and move prospects
along the sales cycle .
8. Marketing team relies on the prospect database to create carefully targeted lists
based on incoming traffic, client profiles, and ongoing web activity .
PAST STRATEGIES:
Growth has four faces: Organic,acquisition,diversification and joint venture.
Strategy over the past years has shown a marked change from earlier
pattern.Between1966-2009,it grew through diversification,patnerships and
organically, through Innovations.
RECENT STRATEGIES:
IT services and product segment accounted for 69% of the company’s revenue
during the Fical year ended March 31,2009.WIPRO provided its clients with
customized IT solutions.In the area of IT services,technology infrastructure and R
& D Services.WIPRO Provides services to banking segment,manufacturing
segment,energy industry etc.
WIPRO’S STRATEGY REVOLVES MAINLY AROUND THREE POINTS:
 Service line Expansion – Building a full port-folio of technology services.
 Quality leadership – Quality standards such as six-sigma,effort to become
global six-sigma leader.
 Investing in human capital – WT is investing a lot in training,not only on the
technology side but also on teaching its engineer how to become
consultants.This helps them to take on large and complex projects and drive
them out of India.
WIPRO’s STRATEGY FOR FUTURE GROWTH
Wipro expects to significantly grow its global IT services business and the
percentage of its total revenues and profits contributed by this business over the
next few years. It hopes to achieve this objective by identifying and developing
service offerings in emerging growth areas as separate business opportunities, such
as infrastructure support services, business intelligence services and
telecommunication, internet and application service providers.

ORGANIZATION STRUCTURE OF WIPRO IN GLOBAL


BUSINESS

IT Business has two organizations


 Wipro InfoTech
 Wipro Technologies
 Wipro InfoTech serves India, West Asia, and Asia Pacific
 Wipro Technologies handles global business
In functional term the Company has a matrix structure with three verticals and
two horizontals.
VERTICALS:
1) $1.06 billion technology business
2) $1.4 billion enterprise business
3) $799 million financial service business
HORIZONTAL:
1) $1.1 billion global practices business
2) $290mmillion BPO operation
BENEFITS / MOTIVES BEHIND INTERNATIONAL
BUSINESS

They are:-

1. Vertical market expertise: Wipro complements a series of horizontal BPM


solutions with specialized offerings for a number of key verticals, including
financial services, energy, retail, telecom, manufacturing and healthcare. TBR
believes Wipro brings a winning combination of vertical market solutions and
consultants with specific vertical market expertise.
2. Cost Savings: Particularly in a down economy, cost savings is often a key driver
of BPM engagements. These engagements allow customers to automate and
streamline processes, and Wipro customers have demonstrated success in driving
out costs throughout the value chain, including reduced operational, maintenance
and people-related costs. In speaking with Wipro customers, Wipro focuses its
BPM recommendations on areas that will deliver the highest return on investment
while helping ensure that the BPM program aligns with the company’s overall
business strategy. The net result is a successful long-term cost savings program
coupled with continuous improvements in quality.
3. Improved revenue performance and customer retention: Often customers are
challenged not only with reducing costs, but with fixing a business problem –
whether it be low customer satisfaction due to significant downtime and/or poor
response times. Wipro’s BPM customers note that the company’s BPM solutions
go beyond the cost equation, providing support for more strategic initiatives that
help drive improved top-line performance.
4. Expertise in process methodologies: Wipro’s customers consistently note that the
success of their engagements has been driven by the combination of Wipro’s
strength in understanding BPM tools and platforms coupled with its focus on
methodologies such as Lean and Six Sigma. Wipro leverages these tools and
frameworks to ensure that it has a good understanding of the customer environment
and the potential benefits of a BPM engagement. Customers describe Wipro’s
approach as pragmatic with a focus on understanding customer needs and creating
a solution that addresses those needs in the most logical way, avoiding undue
complexity.
SUGGESTIONS AND CONCLUSION
SUGGESTIONS are:-

1.Product Diversification: It can move to related-diversified towards


telecommunication and Mobile handsets in India, which is a 3rd largest user for
Mobile phones. and other emerging countries.

2. Establish presence in emerging markets such as Brazil, china, korea, where there
is a huge potential for further growth. Since being the first player in the market
results in market leadership in subsequent years when the market is more open
and attractive for other investors.

3.Wipro should try to improve in net profit margins to improve its valuations in the
coming years.

4. Wipro can take the strategic advantage of growing market demand of retails
which is booming in Indian Market by having strategic alliance with different
Retail Companies.

5.Should adopt the Dynamic High Technology Strategies:-


• Increase Global Presence
• More collaborations with other players; reduce dependence on only few
players
• Leveraging the huge investments in R&D to gain competitive advantage
with respect to other players
• Diversify into various Sectors
• Go for quality certification

6. Increase their number of clients.

Till today Wipro has been known for being very process oriented with a focus on
quality and cost savings. Wipro long term strategy should be to create a brand
image and be known for innovation. Wipro should invest in R&D and Market
research, so that It is able to innovate new solutions for clients to cut costs or
reduce time to market or improve reliability.

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