Suresh Vaswani, Joint Chief Executive Officer of Wipro, India’s third largest information technology services company, talks to Shivani Shinde on its aim to be a global firm, focus on new segments like the government sector and US anti-outsourcing sentiment. Edited excerpts:
For Wipro, US public services or government is a new focus area. How would the recent Ohio governor’s action (banning state agencies from outsourcing) impact your plans?
I do not think this will impact us. We have worked with the US government in the past. The new thrust and the formation of a new vertical is being done with a clear view that we can do business, but we might have to do business differently. Simply because it’s a market you cannot ignore.
It’s not that the government has anything against Wipro but it is concerned from where the service is being delivered. There is a model that can be created to tap this sector. However, anything that seems to be protectionist is clearly not the way global markets work.
In terms of model, will it be more focused towards onsite?
Yes, we might have to be more onsite, but not necessarily. At the end of the day, the government also wants cost-effective solutions. The idea is to leverage the onsite delivery centre. In some of the projects that we have with some of the US state governments, we have used an onsite-offshore strategy. But there is an expectation that what is onsite should be served by locals.
Will the increase in the visa cost be charged to customers?
From an operational point of view, if it is going to be an impact, the customer will have to pay. But more than the effect on margins, I think it is a sentiment that gets impacted. India is a huge market. These kind of actions can start a chain reaction. So, you need to believe in free trade. Besides, American companies need the Indian market. India and China are the fastest growing markets, with over a billion population.
Wipro is increasing its onsite presence. What’s the strategy?
As a global firm, we need presence across regions. At present, 35-36 per cent of our employees outside India are locals. We need to have 50 per cent of our overseas employees to be locals to be a truly global firm. We are working towards this. Today, a majority of our senior executives are locals heading those units. For instance, Hiroshi Alley, who heads Japan operations, is a Japanese; the Middle East unit is headed by a local prince.
Some of our business has a rich mix. For instance, consulting. Most of those in this unit are from the US and UK. That shift has taken place at Wipro in the past two years.
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When we talk of expansion, we are looking at gearing near-shore centres. Our Atlanta centre is one of these. We want to scale some of the centres.
How has the anti-outsourcing sentiment impacted the business?
One is the sentiment and then there’s the harsh business reality. Ultimately, the business has to succeed. From a customer perspective, they do what is right for the business. If I give better quality of services, why would they be concerned about the region or any other criterion? I would service an Indian customer from my US centre if the US centre is not being utilised. I would service from Egypt if I have capacity there. That’s the way any business works. Look at MNCs like Microsoft, Cisco and others. They have leveraged the strength of the world.
Offshoring has to increase. Where is the talent? India has the talent and to be a successful global firm, you need to leverage talent.