MphasiS gears up for outsourcing 2.0
THANUJA BM, Bangalore, June 19, 2008

MPHASIS, the Indian arm of tech major EDS, is preparing itself to be an outsourcing 2.0 player, a term used to describe firms offering digitised solutions for customers.

This focus would also include creation of IP and developing digitised solutions.

Jeya Kumar, the new CEO of MphasiS told Financial Chronicle the company will also start a new service line called autonomic computing, which will be a part of the 2.0 plan. One such digitised solution developed by the company — an e-BPO solution for accounts payable function — will be rolled out at a CIO conference in July. The offering has been internally piloted.

MphasiS is now investing heavily in autonomic computing, which will reduce revenue dependence on new hiring. This service line will basically reuse customer knowledge to electronically resolve problems, said Kumar. According to the CEO, autonomic computing service, which is highly scaleable, would be knowledge intensive but save costs considerably for both the company and clients. “I see lot of potential for this area. Up to 65 per cent of problems resolved physically can be done through this method,’’ he added.

The company is already working on a remote desktop manage ment solution under this vertical and hopes to roll it out over the next three quarters. The autonomic computing vertical would be a common platform, coming under MphasiS’ Infrastructure Technology Outsourcing (ITO) and Applications Services Outsourcing segments.

The vertical will have a new head coming on board in July, who has been told to create his own team. MphasiS is also looking to streamline the organi sation. With a few of the top-level people leaving, chief executive Kumar has decided to remove one layer of hierarchy to reduce the management to entry-level ratio. He has also increased direct reportees to the CEO to 10 people from five.

These 10 positions include head of technology development, head of operations, chief quality officer, chief sales officer, CIO, CFO and HR head. On the growth front, MphasiS is eyeing revenue growth on similar lines as that in fiscal 2008. Last year, the company grew 31 per cent overall. Infrastructure management was the fastest growing segment at 57 per cent while applications revenue (its biggest segment) grew 29 per cent and BPO rose 23 per cent. The tech major plans to add between 7,000-9,000 people to its current rolls of 27,000 people in FY 2009. About 3,000 people will be for the BPO operation.