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In a report published on 18 September, 2007, Forrester investigates seven India-based firms that provide IT Infrastructure Management Services. The findings have been published in a document titled "Smaller India-Based Infrastructure Providers Can Be the Right Size for the Right Clients" – by Paul Roehrig. This report was a follow up of Forrester’s earlier report The Forrester Wave TM: Global IT Infrastructure Outsourcing, Q2 2007.
SOME OF THE HIGHLIGHTS FROM THE REPORT ARE:
- Hundreds of global infrastructure management clients are already benefiting from lower cost remote service delivery in selective outsourcing deals delivered by smaller Indian firms.
- The seven smaller India-based provider firms already account for at least $200 million in annual infrastructure management business. Overall, these firms have decent profitability (with the exception of Sify), but only Microland and Sify generate more than the overall average of 29% of total revenue from infrastructure work.
MICROLAND – AS PROFILED BY FORRESTER
With 2,000 infrastructure employees, Microland is the largest firm considered in this report. A pure-play infrastructure provider with 18 years in the business, it provides a comprehensive set of services to some Fortune 100 clients, and can offer clients many of the same options larger competitors do like ISO compliance and Six Sigma quality improvement. With 88% of infrastructure employees in India, Microland is clearly betting on the remote service delivery model; it has deep roots in networking and is the only firm considered here with a significant presence, greater even than Capgemini and Unisys in managed network services (LAN and WAN routers and switches). Like some larger competitors, Microland eschews specific vertical alignment, has an eco-system of delivery partners to service clients, and offers alternative pricing mechanisms that include outcome-based pricing options with continued cost reductions.
MICROLAND SAYS: CLIENTS CAN GET MULTIPLE BENEFITS
Clients that choose to work with smaller India-based firms can get great deals. In general, these smaller firms offer the cost savings associated with wage arbitrage as well as generally high levels of commercial and delivery flexibility, and some of the infrastructure providers examined here also have deep, specialized, industry vertical expertise. But clients need to be aware of potential limitations like provider instability, a generally narrower breadth of services, and the need for more robust management structures and processes.
What it means to you as an Outsourcing Professional in an organization looking for the right partner to deliver such services? Second-tier firms can unlock great business value for the right clients.
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