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The Analyst Magazine:
Big Blue : Indiacentric Strategy
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Big Blue remains bullish on the Indian economy with big plans to triple its investment in India over the next three years. IBM, the worlds biggest information technology firm, held the s meeting on June 6, 2006, at Bangalorethe silicon valley of India. The uniqueness of the event lies in the fact that this is the first time ever the meeting was held outside the US. This apparently would have sent positive waves about Indias growing potential to the rest of the world.

 
 
 

India has been IBM's fastest growing market with 61% increase in revenues in the first quarter of 2006. The fact that the head count of IBM in India has increased substantially from 9,000 to 43,000 in just twoandahalf years time reflects the growing significance of India in IBM's success. Though lowcost destination is one of the factors for its rapid expansion in India, it is definitely not at the cost of lowskilled people. Indeed, IBM's global network strategy is to capture the best people at the best cost in the right place. Having explored all these options in India and realizing the growing potential in India, Palmisano has planned to triple IBM's investment in India to $6 bn over the next three years.

During 1990s, with the intensifying competition, many of the technologydriven companies have struggled for mere existence. To gain a competitive edge and differentiate themselves, few of them have shifted their focus by offering product or servicecentric packages. In this backdrop, Louis Gerstner, the then chief executive of IBM, revived the struggling computer giant by successfully transforming IBM from being a hardwarecentric enterprise to a servicecentric enterprise. In a 1999 report, Fortune had in fact commented: "IBM services now matter more than its hardware. That's the key to Louis Gerstner's remarkable turnaround in IBM's future. In 1992, income from services represented 12% of IBM's revenues; by 2003, it is estimated that services will represent 46% of revenues. The challenge facing IBM in moving to a productservicecentric organization is in managing the transition effectively."

 
 
 

The Analyst Magazine, Indiacentric Strategy, Information Technology Firm, Global Network Strategy, BRIC Countries, Multinational Companies, MNCs, IBM Global Services, Systems & Technology Group, STG, Telecommunications Research, Bharti TeleVentures Limited, Market Telecommunications, IT Services, Indian Economies, India Software Lab.