IBM taps into India for ‘Global Delivery’

BANGALORE — The world’s largest information technology company, IBM, is building today a microcosm of all its global capabilities in India, from software and research laboratories, global business solutions centers, outsourcing services, application services and consulting to global service delivery centers.

Everything that IBM does today is represented in India as one big IBM Global Delivery effort. It is here where IBM now effectively shows the world how it can develop locally and deploy globally.

Working with other IBM global delivery centers that span over three dozen countries, IBM’s Global Delivery in India proves how the company has become a globally integrated enterprise as architected by its president and CEO, Samuel Palmisano.

The immense importance IBM gives to India today can only be rivaled by China. These two countries are IBM’s two most important markets today, primarily due to the size of their domestic IT markets and huge talent pools.

To see the depth of IBM’s infrastructure in India one must first pass a series of dusty, narrow and noisy streets in Bangalore until they open to quiet places of work – the technology parks where IBM’s buildings are nestled. Inside these buildings are the company’s software and research labs, data and call centers, and other types of global delivery centers.

From India to the world

IBM has established over 25 centers in India, including an IBM Innovation Center for Business Partners, Linux Solutions Center, IBM Linux Competency Center, Software Innovation Center, India Software Lab, Center for Advanced Studies, Lotus L2 Support Center, IBM India Research Lab, Global Business Solution Center (GBSC), a Global Services Delivery Center (GSDC), IBM Daksh and Business Transformation Outsourcing Centers, and a SOA Solutions Center, among others.

One of IBM’s Global Delivery initiatives in India touches on consulting and applications services. Amitabh Ray, the vice president for this effort, says majority of the over 500 consulting and applications projects they have today are from outside India. Seven of these customers are the world’s largest telecom companies and at least five are the biggest automotive companies abroad.

Developing locally and delivering globally give customers greater choice, flexibility and operational efficiencies, says Ray. IBM delivers application services seamlessly through its various centers, leveraging its infrastructure, processes and skilled resources.

"All these delivery centers are connected to high-speed network backbone using the same methods and tools so our clients get geo-transparent delivery experience. It helps us and our clients avoid many types of risks," Ray adds.

One of the newest global delivery centers is the GBSC (Global Business Solutions Center). It focuses on the delivery of at least 45 IBM business solutions from India to customers all over the world.

"When the people that developed the different business solutions are sitting in different parts of the world it becomes hard to leverage their knowledge and expertise. Hence, the GBSC is like IBM-in-a-box in the way it brings together in one center all our solutions for the 17 industries we compete in. It becomes an asset-based deployment strategy," says Jeby Cherian, director of IBM GBSC.

IBM also established in Bangalore a service-oriented architecture (SOA) solution center in preparation for the expected growth in SOA implementation across the globe.

"SOA will become a way of delivery under the GBSC. We will have one repository to contain all our SOA assets to be delivered to clients worldwide. We will provide standardized framework and foundation to run our customers’ applications. If they want to change their processes it will be easy because they will have access to the building blocks," explains Sudhir Sastry, leader of the SOA solution center for IBM India.

Meanwhile, all the Global Delivery centers in India benefit greatly from the fact that IBM India Research Lab and IBM India Software Labs can be found in their own backyards. At present, IBM has research labs in New Delhi and Bangalore that prioritize finding solutions in the areas of systems management, information management and interaction, and software engineering/distributed computing.

"IBM India Research’s mission is vital to IBM’s future success. Whatever we do, we are with our customers for the long haul. The innovations here are pushed to the different global delivery centers. We work closely with different IBM business units to know what technologies we need to develop that will be used in the marketplace or by IBM business groups," says Dr. Sugata Ghoshal, a senior researcher at IBM India Research Laboratory.

For example, it is the research lab that developed the speech analytics tool used by IBM Daksh to train and test the English pronunciation skills of its Indian call center agents and applicants.

"Fundamentally, it’s a very global environment we work in. Since we are a small group, we collaborate with several IBM research labs in New York, Hafia and Tokyo. We also coordinate with our business partners worldwide. We also take our assignments from IBM delivery centers as if they are our clients, then we pilot what we have developed to the external clients," adds Guruduth Bhanavar, of the India Research Lab.

Worldwide, IBM has 3,200 researchers, eight labs, and pours some $5 billion in R&D every year.

Red-hot India

Aside from the 25 global centers in India that are distributed in 14 cities, IBM’s operations in this country also involve some 2,500 channel partners in 40 cities. The company employs approximately 43,000 people and is the biggest software exporter in the whole country.

"We have seen double-digit revenue growth over the last six years, with 55 percent revenue growth, year-over-year, in 2005," says Shanker Annaswamy, country general manager of IBM India. "It takes a couple of visits to start appreciating India. For one, our international airport offers an ‘interesting’ experience. But this country is definitely poised for phenomenal growth."

Annaswamy says the Indian people are the real source of innovations that answer to the need of multinational companies like IBM that are looking not just for rich domestic opportunities but also hubs of global innovation and global service delivery.

The statistics speak for themselves: India currently has 1.6 million IT professionals, 1,540 engineering schools with 400,000 graduates every year, three million college graduates a year from other disciplines, produces a million Mathematics graduates every year and, in 2010, will have 21 million college graduates and will be the second largest country of scientists and professionals in the world.

Meanwhile, the Indian economy is growing at eight percent on an annual basis while the IT industry is growing at 30 to 32 percent.

Against this backdrop, IBM finds India a red-hot market for talent that the company critically requires to carry out its Global Delivery strategy.