IT & ITES Growth through

Business Excellence

K R Lakshminarayana
Wipro Limited
Jan 2007
A Presentation at the 48th National Convention of
As an IT Destination, India has Come a Long
Way…

30.5

Indian IT Services + BPO Exports

1999 through 2007E
23.6

CAGR of 36%
17.2

12.8

9.6
7.7
6.2

4.0
2.6

FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07E

Source: Nasscom

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 Reflecting the Disruption Caused by Top Indian
Players

Company 2001 2005 CAGR

$ Mn Rev EBIT Empl Rev EBIT Empl Rev EBIT Empl

IBM Global 37,603 5,161 139,41 47,406 4,542 191,00 6% -3% 8%

Services 2 0

Accenture 13,061 2,511 75,174 17,094 2,111 109,70 7% -4% 10%

0
HP-Compaq 12,846 1,586 N.A. 15,536 1,351 N.A. 5% -4% N.A.

EDS 21,033 2,054 108,22 19,821 141 129,60 -1% -49% 5%

0 0
Rs. Mn ($Mn)  2001-02  2005-06   CAGR

Wipro 22,909 7,851 11,796 80,514 19,40 53,742 37% 25% 46%
510 170 1810 9
430
TCS 43,706 12,531 18,269 132,454 33,90 62,832 32% 28% 36%
970 280 2,940 1
750
Infosys 26,035 8,770 10,738 95.216 26,54 52,715 38% 32% 49%
580 190 2,100 8
590
Satyam 18,031 5,349 8,634 47,926 10,32 26,511 28% 18% 32%
410 120 1,100 1
230
Cognizant 180 35 3,926 880 170 24,300 49% 50% 58%

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& Wealth Created for Investors

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 Yet, India just a small Fraction of Opportuntity
Space
Service Line Spend (U$Bn) Offshoring Addressable Current Head- Space
Potential% Market (U$ Bn) Exports
* AM Level 1 3 30- 40%
* AM Level 2 5 70- 80%
* AM Level 3 9 80- 90%
ADM ($103 * AD Analysis 6 0%
30- 36 6.6 5X
Bn) * AD Design 7 25- 30%
* AD Development 39 75- 80%
* AD Integration & testing 17 50- 60%
* AD Support 17 50- 60%

* Analysis 24 0%
* Design 24 20- 30%
69 30- 36 1.1 30X
SI ($197 Bn) * Development 50- 60%
* Integration & Testing 41 40- 50%
* Support 39 10%

* Desktops and server 44 30- 40%

Traditional * Network 65 75- 80% 70- 85 1.0 70X
IT ($436 Bn) * IS 196 20- 30%
* H/ W Deploy. & Support 131 30- 40%

Consulting * IT Consulting
70 10% 3- 4 0.2 15X
($70 Bn) * Network Consulting

* New Product Dev. 9 75- 80%

* Maintenance 8 75- 80%
R&D
* System Testing 3 60- 70%
Services (35 14- 17 3.1 5X
Bn) * Porting/ Variants 7 75- 80%
* Localization 5 100%
* Documentation 3 90- 100%

Source: Nasscom Mckinsey Report 2005

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India Continues to Score Over Other
Places…

India Continues to be Ranked

Amongst the Most Attractive

Driving Force being

the Cost+Capability+Productivity
Of Labor Force

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 Quite Logically Therefore, Future Looks
Set!
India’s offshore IT and BPO exports, US $ Bn.
CAGR
36%

~80
Projected CAGR
2005-2010
CAGR 20
28%
~60 35 BPO > 46%

20
25

23
CAGR
45 Offshore IT
29% 1 > 30%
35
5.2
7.2
6.
0.9
2 12
5

2001 2005 2010 Additional "Extending

"Sustaining Potential Leadership"
Leadership"

Source: Nasscom Mckinsey Report 2005

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Value Creation Equation

P(Momentum)= M(mass) x V(velocity)

In Physics

P(Performance)= M(mass/scale) x
As applied to IT Services

V(growth)

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Components of the equation

P = M x V

Addressabl Talent Knowledge Value

e market Chain Services Propositio
n
•Geography •Scale, Scope •Differentiati •Pricing
•Service & Economics on paradigms
Lines •Specializati •Customer
•Commodoti on oriented ROI
zation •Blind Spots •Life Cycle
Costing
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Components of the equation

P = M x V

Productivit Non- Technolog Business

y linearity y Enablers
Leverage
•Productivity •Business •Share
parameters models •Technology Services
•Usage of as growth •Templatized
analytics accelerator Solutions
•Emerging &
subsiding
trends 10
 Now for the view of the experts…..
P(Performance)= M(mass/scale) x
V(growth)

Information contained and transmitted by this presentation is proprietary to Wipro Limited and is intended for use only by the
individual or entity to which it is addressed, and contains information that is privileged, confidential or exempt from disclosure under
applicable law.

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