The outsourcing giant is reshaping its approach.
As one of India's outsourcing giants, Wipro Technologies has been grappling with the fallout from the global financial crisis on its customers around the world. Founder and chairman Azim Premji transformed Wipro from a cooking-oil seller to a $5 billion IT company with operations in more than 50 countries. Premji, worth $14.9 billion, ranked 4th on Forbes' list of the richest Indians last year. (See the complete rankings of India's richest.) Wipro doesn't just run call centers. It offers services far up the value chain for clients, including research and development. It has grown exponentially: from 72,000 employees two years ago to 95,000 today.
Forbes' Megha Bahree talked with Girish Paranjpe, Wipro ( WIT - news - people )'s co-CEO, about how the company is experimenting with offering clients radical outsourcing, how volatility in the global economy is changing his business; about a new flight between China and Bangalore and the recent attacks on Google ( GOOG - news - people ).
The recession is officially over. Are you seeing your business pick up again?
Girish Paranjpe: People thought that we'd put our world on hold for two years and then we'd get back to business as usual, get back to growth. But [during this same time period] there's been a supply shortage on commodities, food prices have gone up in emerging markets, we're waiting to see when will the next spike on oil will come, and precious metals have had a record run. There's a lot more uncertainty now and hence more volatility, and with the past recession, clients are a lot more cautious and careful in how they spend money.
How is that changing your business?
It's forcing us to think what will our clients absolutely preserve and what can we do about the activities that are not core to their business. So, for instance, in India a new wireless provider is our client and it doesn’t have any internal IT at all. Everything from phone activation, billing, paying commissions to dealers, Wipro is maintaining all this. We get a base fee and with an increase in subscribers we get a certain percentage of their revenue. We are experimenting with this for two clients right now.
What else are you doing differently?
We launched about a year ago a shared services center. [In the past] clients wanted us to recreate our environment like theirs so they felt comfortable that this was an extension of their office. This was good in the beginning but not ideal over time. We decided to run things like shared services – one space where we could work for multiple clients, use the same tools, processes, people. Plus, we told them to pay per use and not on a dedicated basis.
What are you doing in China?
We went in three years ago on the back of global clients who had operations there. We first set up a center in Shanghai but just trying to support the Chinese operations of clients was not enough to justify being there. About 9 months ago we set up an office in Chengdu in western China. We're building a development center there and it'll be just like our center in India. We have 150 software programmers there right now and plan to hire up to a thousand. The city government has been very helpful and has even pushed for a direct flight between Bangalore [our headquarters] and Chengdu. This launches next week.
Google recently complained that its servers were hacked allegedly from China. Are you worried something similar could happen to your business since you have operations there?
Hacking has always been a concern, no matter whether it comes from eastern Europe or China. We've reviewed our security practice, post-Google, and are looking at upgrading it. That said, as Indian IT has prospered we get a stream of visitors from Costa Rica to China to learn from us. We're not worried about this competition. Others can't replicate quickly the client trust or the institutional knowledge.
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