by Beth Bacheldor

IBM Finds Outsourcing Work in India

Mar 18, 2011
Enterprise Applications

IBM has hooked a mega, 10-year deal with an Indian manufacturer of automotive systems.

This week, IBM announced  it signed a 10-year outsourcing deal with Caparo India to provide enterprise resource planning (ERP) and data center infrastructure services. Financial terms of the deal weren’t disclosed, but seeing that it’s a 10-year deal, well, one can expect it’s worth a lot.

Caparo India, by the way, is the Indian business arm of Caparo Group. According to its web site, it began operations in 1994 as a joint venture with India’s largest car manufacturer— Maruti Udyog. Today, through its two strategic business entities, Caparo Engineering India Pvt. Ltd. and Caparo Maruti Ltd, it offers end-to-end solutions in designing, developing and manufacturing automotive systems, assemblies, advanced composites, modules and components to Indian automotive OEMs and engineering Industry. It employs 5000 direct and indirect employees.

I simply thought it was interesting that Caparo India went with IBM, and not an Indian IT outsourcer. What’s equally interesting is that press reports indicate Caparo chose IBM over competitor HP because the IBM solution – which includes hosting the Caparo India’s data center on IBM’s systems, in a cloud model – will save up to Rs 1 crore (or about $222,000) in upfront investments. So the other chief competitor for the gig (at least the one mentioned) was also not an Indian IT outsourcer.

I haven’t got any insider information or juicy details. But the reports I read quote an IBM executive – Vivek Malhotra, VP, General Business, North and East region, IBM India/South Asia – as saying, “This is a first of its kind implementation in North India. Our financing policy helps clients acquire the IT solutions that their business needs in the most cost-effective and strategic way possible. Customers can choose from a variety of financing options to address their unique solution requirements and help manage the cash flow and assets.”

IBM is working hard to be a relevant force in the Indian economy. Earlier this month, IBM announced that it is partnering with the the Karnataka Vocational Training and Skill Development Corporation (KVTSDC), an organization within the Department of Labour in India’s fastest growing state.

The partnership is aimed at helping millions of citizens find work using their mobile devices. Once created, this technology could be applied in emerging economies around the world, according to a joint press release issued by IBM and KVTSDC. India has a long way to go before seeing the kind of Web access we in North America enjoy (a reported 77 percent). The press release says that only 7 percent of India’s population has access to the Web. But mobile phones and services are gaining ground, and with that… a mobile Web.

So IBM and KVTSDC say they are teaming up to leverage cloud computing, the mobile Web and the Spoken Web to help millions of people across the Indian state of Karnataka find work. The effort will include a new cloud computing platform that lets job seekers and job providers connect, expand searches and cross reference candidates, get training and certifications, understand emerging job trends and share information all through their mobile devices and in their local languages.

It truly is a global world. Thoughts?