Kyndryl aims to grow consulting business to 15% of top line by 2025

Kyndryl Consult was established as a separate unit in November last year which combines Kyndryl's consulting expertise with its technology integration solutions

Kyndryl, the independent entity formed after the spin-off of IBM’s infrastructure services, aims to grow its consulting business to over 15 per cent of its revenues by 2025 from 13 per cent now, said Ashish Kothari, vice-president and partner, Kyndryl Consult. 

Given that consulting is a high-margin business, even a 1 per cent rise in consulting revenues can significantly boost margins, said experts. 

For the financial year ended March 31, 2023, Kyndryl reported revenues of $17 billion, a decline of 7 per cent compared to last year. To put in perspective, Accenture, considered the largest consulting firm globally, reported a 25 per cent increase in consulting revenues to $34.1 billion for FY22. This is more than 50 per cent of its total revenues of $61.6 billion.

 

Globally, Kyndryl has more than 10,000 practitioners, who are focused on the consulting practice.

“Our model is a globally-integrated one and we leverage most of it also for what we do for the India business. We continue to invest in all the parts of our consulting business, including our partners,” Kothari told Business Standard.

Kyndryl Consult was established as a separate unit in November last year that combines Kyndryl’s consulting expertise with its technology-integration solutions. It aims to help new and existing customers navigate the complex technology environments and accelerate business outcomes. 

Kyndryl Consult is helping customers in their digital transformation across three key areas. “First is to modernise for efficiency and growth. Second is to innovate for differentiated customer experience. And third, is to build a resilient and secure business,” said Kothari.

The consulting market grew 14 per cent to $266.3 billion in 2022, according to research firm Gartner. Kyndryl does not report its consulting revenue separately but it is estimated to be around $2 billion. In November 2021, Kyndryl signed an agreement to acquire Finland-based Samlink in a bid to bolster its consulting business. This is especially in financial services in the strategic markets of Finland and the Nordics. In this region, the company is helping major financial institutions drive their digital transformations. 

Kyndryl Consult works with enterprise customers across multiple sectors such as fintech, automotive, retail, and manufacturing. Some of its customers in India include Godrej, National Stock Exchange, Dr. Lal Path Labs, Somany Ceramics, and Holcim.

Kyndryl was formed as an independent entity in November 2021. It claims to be the world’s largest IT infrastructure services firm as it started life with $2 billion in cash on its books, more than 4,000 enterprise customers in over 60 countries, and annual revenues of nearly $19 billion, when it officially separated from IBM on November 4, 2021.