India’s Infosys sets up U.S. consulting firm

Infosys Technologies Ltd. said Thursday that it is investing US$20 million into a business consulting subsidiary in the U.S., which will be managed by four former senior executives of global consulting firms.

The wholly-owned subsidiary, Infosys Consulting Inc. in Fremont, Calif., will enable Infosys Technologies to deliver a range of services to its clients, from consulting to technology services and business process outsourcing, according to Nandan Nilekani, chief executive officer (CEO) of Infosys Technologies in Bangalore, India.

Infosys Consulting is being led by CEO Stephen Pratt, who until recently was the global leader of the customer relationship management (CRM) practice at Deloitte Consulting, the business and IT consulting division of accounting giant Deloitte Touche Tohmatsu.

The new company plans to hire 75 consultants in the U.S. in the first year. “Because of the restructuring in the consulting industry in the U.S., a lot of staff are willing to move over,” said Pratt. “We plan to hire from the top 10 per cent performers from the leading consulting firms.”

Besides Pratt, Infosys Consulting has as its managing directors: Romil Bahl, formerly vice president of consulting services at Electronic Data Systems Corp.; Raj Joshi, previously CEO of Deloitte Consulting Offshore Technology Group; and Paul Cole, formerly head of the global operations of Cap Gemini Ernst & Young’s CRM practice.

Faced with competition at the low end from multinational services companies that have set up low-cost services delivery operations in India for their global clients, a number of Indian software services companies are going up the value curve into offering consulting services, though the preferred route has been through acquisitions. Wipro Ltd., a software services provider in Bangalore, for example, acquired last year NerveWire Inc, a Newton, Mass.-based business and IT consulting company serving financial services clients.

By setting up Infosys Consulting, Infosys Technologies, which is India’s second-largest software services company, is aiming to counter competition from consulting and technology services companies like Accenture Ltd. in Bermuda, Plano, Tex.-based EDS and IBM Global Services in New York, which have set up services delivery operations in India to take advantage of the country’s low-cost technical manpower. “For now we have a more efficient offshore delivery model as we have been delivering services from India for over 20 years,” Nilekani said at a press briefing.

“By investing in the markets we operate in and hiring locals, we want to show our commitment to these markets,” Nilekani said. Indian outsourcing companies are increasingly blamed by workers and politicians in the U.S., Australia and the U.K. for those countries’ tech job losses. Earlier this year Infosys acquired Expert Information Services Pty Ltd., one of Australia’s leading IT services provider, to enhance its Australian market presence.

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