Analysis of Indian IT Companies in Respect to ERP Implementation in USA Market
The ultimate aim of the research is analysing Indian IT companies with respect to the implementation of the ERP in USA market. The IT industry is gaining much recognition and is being embraced by the global market. Indian companies have not been left out in this realisation.
Since the industry contains a lot of companies, it is not possible to conduct a research in all the companies. For that reason, the research has concentrated on Tata Consultancy Service to act as a representative sample of the entire industry. Data for the research was collected from this company.
The objectives of the research entail identification of the advantages and disadvantages of the ERP implementation. There is also the objective of identifying the main competitors of Tata Consultancy Service in ERP implementation. This will go along in examining the obstacles facing Indian IT companies in the United States market and developing strategies to help deal with them.
There is a literature review section which provides some knowledge to the research process. This includes work of other individuals that have participated in a similar research before. During the collection of data, both primary and secondary methods have been used. Primary methods that have been utilized include questionnaires, observation and interviews among others. More secondary data has come from the company website and other relevant internet sources. The sample size of the research includes 100 respondents composed of both the employees and managers.
Data collected has been analyzed and interpreted. This has provided the ability of enlisting the findings from the research. It is followed by a list of recommendations for both the Indian IT companies and individuals that would want to take part in future research on the same area.
Chapter 1: Introduction
The ultimate objective of this research is to have an idea of how Information Technology industry had the capacity to get up to speed effectively access, study, and improve to the mechanical benchmarks of worldwide pioneers while others in the improving scene fall behind. Under this scope, the main focus will be particularly on the software industry. Enterprise resource Planning (ERP) software will be the main focus in this research. However, other software will be examined in the research to provide room for comparison purposes. The focus of the study is analysing how the Indian IT companies have been able to position themselves with the ERP software in USA. This comes along with the notion of how difficult it might be to operate in the global market at a profit. The topic of study becomes even more interesting based on the fact that USA is among the leading countries when it comes to Information Technology systems and infrastructures. There are huge companies like IBM and Dell. Both have a substantial market share, and have immense influence in the industry. Despite this occurrence, IT companies from India such as Tata Consultancy and Infosys Ltd have not been deterred into venturing into this market.
The Indian software IT industry has been a surprising example of overcoming adversity. It had developed more than 40% every twelve-month for 22 years, with 2010 fares extrapolated at near $70 billion. India trades software administrations in more than 80 nations worldwide. Almost two-third of this goes to the United States market. This results to a massive market share for the Indian IT companies in the USA market. In 2010, it was estimated to be slightly above 47% of the market share (Saxenian, 2010).
Economic strategy has experienced considerable amendment determined on their part, and India started to open up. Remote trade stores are high; markets incredibly impact approach, and a string of coalition governments have not digressed from monetary liberalization. Profits are uneven, however, as the precise unfortunate have been slightly influenced. High unemployment proceeds and immense organizations still yield to undermining. While issues remain, India is a developing economy filled by techno-clever labour and a world class qualified Information Technology industry. This is among the reasons why USA has been using Indian man power in most of its developmental projects. If one was to visit the native IT companies in USA, they would be mesmerised by the number of Indian man power being utilised there. It has been a subject of immense brain drain whereby the competent manpower in the IT industry from India is migrating to USA in search of greener pastures. Upon arrival, they are accepted with open hands since their expertise is valuable and in high demand.
The Indian software industry has moved a notch higher compared to previous years of operation. Initially, the industry was only famous with making modifications on software that already existed. Nowadays, working from scratch is not a problem anymore. This window of opportunity has been availed by the government. The government has moved in to improve the education systems in the country. Current education curriculum is aimed at bringing progression to all students that are involved. The education prospects have been taken closer to those in the USA and other global markets in the developed countries. After this achievement, the government came to realize that the global market has some deficiencies in specialized labour. In this respect, Indian firms gathered individuals that were eager to operate in other markets in the industry. This would come with the prospect of earning higher wages in return. After fulfilling all the required qualifications one had to have good English-speaking skills since USA market was the ultimate target. This prospect has lived even into the current year of 2013, and has played a significant role in ensuring that Indian IT companies are doing well in the United States Market. However, some of this labour force from India has been absorbed in the American companies.
Indian experts in Silicon Valley utilized their reputation and impact inside US organisations to assist Indian organisations get a foot in the entryway of the growing chance of outsourced IT function. When the potential of software fares was exhibited, Indian Government assisted to construct a rapid information correspondence foundation, which permitted abroad Indians to go back home and set up seaward destinations for U.S. customers. The Indian “mark” picture for reasonable speed and quality developed. This aspect of working in partnership by various stakeholders has been vital in ensuring that Indian companies have prospered in the USA market.
Indian companies are providing a variety of software in the USA market. However, Enterprise Resource Planning (ERP) software has been the main focus for these companies. This is because with this software, they have the ability of attaining a substantial market share based on the number of people that are being targeted. It ranges from large business enterprises to medium and small sized enterprises. To some point, it can target individuals depending on which software application from the package is being questioned. Indian IT companies usually utilise 5 main client ERP software applications. Among them is Epicor, Infor, Microsoft dynamics, SAP and Oracle. Having more than one software application in one system, works similar to other software like Customer Relationship Management (CRM) software. CRM is concerned with the interactions that the company has with its consumers. This does not matter whether it is service or sales related. It is thought of being a strategy that enables organizations to understand consumers, attract new customers, increase profitability, reduce customer management costs and retain the customers among other things. It is one software package aimed at delivering a variety of benefits to businesses.
Going back to the ERP 5 client applications, we begin by analysing SAP software. It is a software solution that has the ability of incorporating key functions in an organization. The solutions that it handles include accounts payable and receivable, financial reporting, risk management, human resource payroll, placement and procurement to mention just a few. Various developments to the software have been taking pace. This means that the software is being modified from time to time to help keep up with the current technology. Microsoft dynamics software on its part has been developed to target midsize organizations. Its usage is extended to subsidiaries and sub-divisions found in larger organizations. It has the capability of connecting an entire supply chain in an organization, making current financial data easily accessible, automating routine functions and minimizing operation costs among others. Epicor software on its part is used by manufacturing firms. It is devised to support any discrete manufacturer generating more than $1 million in terms of annual revenues. Epicor also boasts of having extensive functionality for inventory control, accounting, manufacturing execution and production materials planning. The system can either be collected on hosted, cloud based or premise software offering.
Managers all over the world are recognising the need for their companies to develop necessary skills, knowledge and aptitude in order to compete efficiently in the international market. Continuous dominance of the open economy in the world market, globalisation of consumer preference and tastes and expansion of internet access has resulted to the interdependency of countries in one way or another. IT companies in India have taken this occurrence to their advantage in venturing the global market. The main country of focus has been United State’s Information Technology industry. The industry is very competitive based on the number of players involved. Most of these players have already built a name for themselves in the international market. However, this has not deterred Indian companies from venturing into the market. Implementation of the Enterprise Resource Planning (ERP) software has taken centre stage.
The ERP software has come to be a popular software among business stakeholders all over the world. This is because of the many functions that it can perform in an organization. It has made work efficient and brought profitability prospects to organizations that are utilising it. Indian Information Technology companies are becoming popular in United States in the implementation of the ERP software. However, this does not come along easily without facing obstacles along the way. Among the major obstacles presenting themselves is competition and government policies. Competition from local companies is stiff given that these companies have substantial knowledge regarding the industry hence have the ability of positioning themselves appropriately. Some government policies being enacted are not favouring foreign companies from India. The policies have been designed to protect local companies from extension emanating from competition. This form of protection also helps them in operating at the global market effectively. This is because if the performance at the local market is poor, acceptability in the global market would be difficult. In spite of this, Indian Information Technology companies are making notable strides in the United States IT industry.
The scenario of Indian IT industry for ERP software has received restricted consideration from scientists. There is absence of expositive expression in this field. Separated from that, a percentage of the crux deterrent in the execution of exploration action is dependence on qualified data sources that could be false as individuals from IT firms are speaking for the company’s notoriety and potential speculators. A portion of the IT organisations are not recorded and thus the dependence on money related information accessible out in the open dominion might be deceiving. More needs to be done while analyzing the growth of Information Technology companies all over the world. Systems being used at present tend to favour companies found in the more developed countries. This might be deceiving, and to a larger extent cast a shadow on Indian companies trying to implement ERP systems in the global market. This is because consumers might tend to overlook their work based on what they have read on various magazines and periodicals available to them.
The Indian modifying industry has a pyramidal structure, with several sweeping indigenous firms summoning. Around the 4,000 organisation exchanging modifying from India, the three most amazing firms each have more than $1 billion in yearly bargains. At the other astonishing, the humblest 2,900 firms have yearly bargains of less than $10 million, with ordinarily less than $2 million. The greatest five firms illustrate 32 percent of modifying charges, while the most unassuming firms own a 14 percent stake (Mansour & Khandelwal, 2010).
More unobtrusive firms expect a more critical part in the down home advertise where they supply modifying governments to unassuming and medium measured private firms in various divisions. For their toll contracts, the tinier firms have crucial entered into a grouping of linkages with individuals and minor acquaintanceships abroad for publicizing right to increase enchant. There is little level companionship between small and far reaching sources. A little early on endeavours by made firms to subcontract to additional unassuming ones failed since the more humble companion tried to arrive at abroad clients. Recently a few minor firms have progressed things for the down home showcase with a couple of triumph yet exports have been uncommonly compelled
Multinational companionships arrived in India for the most part late and clarify simply around the extent of a section of passages. Multinational firms use their Indian operations fundamentally as charge stages. More multinationals are setting up shop in India to steer advanced modifying progression practices and as a prisoner wellspring of R&D utilizing India’s pool of exceptionally ready fashioners.
Various Indian organisations have been started by enterprisers who obtained a few wealth and experience working in greater constructed firms then after that set up new acquaintanceships. Colossal amounts of the corporate aides did their graduate study in the United States or worked in Silicon Valley, so they have a sharp understanding of the customizing change process. The high benefit and respectably level peril of the industry has pulled in innumerable. Similarly, segment expenditures are ordinarily level. To start modifying acquaintanceship does not require monstrous hypotheses in zone, plant, or fittings. An extensive divide of the belonging could be picked up for a long duration without any advance payment. The lead time for generating salaries is moreover much shorter than in various distinctive business wanders.
In June this year, the US Senate passed the immigration reforms bill. This bill is aimed at improving global competitiveness of United States local companies. However, it is going to affect Indian Information Technology companies negatively. The bill contains some killer provisions more so the one relating to H-1B visas. The provision allows employers from local US companies to employ foreign workers temporarily in speciality occupations.
1.2 Research Issue
The issue to be examined in this research is how Indian Information Technology companies are implementing the ERP systems in United States market. A lot of issues are involved in this process. Among them is the nature of competition being faced in this market. American companies are viewed to have an added advantage while competing with Indian based companies. Their advantage emanates from stint knowledge of the market due many years of operation into this Information Technology industry. Policies devised by the government also tend to favour the local companies. It is the duty of every government to protect local companies from extinction that is brought about by competition from foreign companies. Another relevant issue is the importance and significance of the Enterprise Resource Planning (ERP) software in the United States market. The ERP needs to be of importance for the users in this market if Indian IT companies are to operate effectively. Advantages that come along with the usage of the software should be able to surpass the costs involved in the installation process. Failure to meet this threshold would mean that \Indian companies have no business implementing the ERP in United States.
Another issue that will be examined in the given investigation work is the courses through which the operational management nature of Indian IT organization suppliers may be moved forward. Since, an establishment examination of Indian IT software industry revealed that the industry is improving at a fast pace and it puts supplemental constrain upon the existing organization suppliers of It noticing satisfactorily dealing with the requests of existing clients and issue IT administrations to the new customers. Since, the operational reasonability of these IT software ERP management suppliers has all the earmarks of being unfairly impacted, the shown investigation work will a bit of mercy down the courses in which this issue of operational deficiency may be moved forward.
The research could shed some light on the strategies that Indian IT companies could adopt while implementing ERP in United States. The strategies would be dependent on how the market is operating currently and hence would help eliminate unnecessary activities and processes that do not add value. In the long-run, this will help the companies in understanding what ought to be done in order to attain success.
1.3 Research Aim
The aim of this research is to conduct an analysis of Indian IT companies in respect to ERP implementation in USA. This will involve having a greater insight into a variety of issues involved under this scope. Relevant stakeholders involved in the process will be outlined so as to help get a greater insight into the issue. All obstacles that the Indian companies are subjected to will also analysed in attempt of providing an actual picture of how things are.
1.4 Research Objectives
- Understand the advantages and disadvantages that Enterprise Resource Planning (ERP) software brings to the USA.
- Examine the obstacles that Indian Information technology companies face as they try to implement their ERP systems in United States.
- Develop strategies that can be used by Indian companies to help them implement ERP in USA and other global markets in the best way possible while promoting the global presence of the country.
- To identify the ways through which improvement of the already efficient IT software companies in India can be enhanced.
- Identifying the main competitors of Tata Consultancy Service in ERP implementation in USA market
1.5 Research Questions
- How can Indian Information Technology companies compete with USA local companies while implementing the ERP systems?
- How will policies enacted by United States government affect Indian companies’ ability to implement ERP in the country?
- What are the challenges being faced by Indian companies in United States in their quest of implementing ERP systems?
- Are there many industries in need of the ERP implementation?
1.6 Rationale of Research:
The explanation in respect to conducting the given examine work is explained below:
The given research on analyzing the operational feasibility of Indian IT profit suppliers is legitimized on single level, as it helps in upgrading my specific capacities about doing investigation work and moreover my insight into the working of IT customizing suppliers in USA in passing on managements to their clients. My single update is particularly guaranteed from performing the given examination capacity.
From the perspective of organisations, the given exploration work is profoundly legitimized as the behaviour of the exploration might assist in recognizing the routes in which Indian IT software organisations can accomplish change over their operational level of exhibition and this might help them in recognizing techniques through which they can better fulfil the requirements and questions of their clients.
From the exhibition of exploration on operational viability of Indian IT software ERP administration suppliers, the operational methodologies of such administration suppliers could be recognized and this in turn might help them in the advancement of strategies that might better locate the concerns of their clients. Along these lines, the discoveries from the given examination will permit the Indian IT software segment to improve the best arrangements for realizing higher operational victory.
From the perspective of scholastic exhibition, the exhibition of an exploration work is quite compulsory and therefore, the given research on operational adequacy of Indian IT ERP area might assist in adequately fulfilling the criteria of the college and it will additionally accelerate upgrade of my scholastic information in the field of my own investment.
Consistent with Creswell (2009) `delimitation’ is a parameter characterizing the verges, special cases reservations in an examination, and its consideration and position in an exploration proposal or compose up changes from one scenario to a different one. The delimitation outlines the furthest point or extent of the exploration. Learning of how Indian companies implement ERP in USA can be used to assess the same scenario in other global markets. There are no major differences since all this market are at the international level and the cultural practices of the people in these countries is different from those in India. This means that a different strategy needs to be implemented as opposed to strategies implemented in the local Indian market.
This dissertation is defined by the following boundaries and considerations:
- The research covers all sectors of the United States market. This means that it will examine both the private and public sectors that are involved with the implementation of the ERP systems. Furthermore, the few studies open on ERP gathering in the composed lives up to expectations were advanced in wide sunlight division organisations (Sedera& Gable, 2008). In this way by looking at private firms, the study will add to the get together of qualified data in the district where it even now needs. Open division organisations furthermore were consolidated to allow organisation to be guided on ERP execution sharpens between private and open organisations. Furthermore, the operational scenarios of individuals by and large moreover private divisions vary awesomely (Mansour & Watson, Khandelwal, 2010) moreover discoveries from one may outfit bits of learning into the other.
- This study talks about ERP software at a non specific level by thinking about its fundamental usefulness instead of recognizing between high-end markets and mid market ERP items. Observational confirmation exists prescribing that, in a few regards the profits of ERP may be practically identical indeed, when frameworks sorts vary (Mabert et al., 2008; Laukkanen et al.,2009). ERP frameworks grouped as top marks have been noted to contrast to the degree that every may offer diverse capacities (Shang &Seddon, 2009); the same is correct for mid-showcase items (Fisher et al., 2009). The previous illustrates the decision of this exploration to incorporate a mixture of ERP frameworks instead of select just a particular sort of ERP. Besides, in some admiration, the consideration of boundless ERP frameworks in a specific study might allow the generalise capability of effects from such a study, for the software.
- This study incorporates both large, medium, and small size organisation in USA which are supportive by the Indian companies.
- All the Indian IT software phases are studied in this research. This is because of the way that research range and India ERP innovation is liable to dynamic change. Organisations in the wake of running live with ERP ordinarily set out on movements pointed at realizing the full proficiencies and profits of ERP empowered techniques. The organisational connection is additionally in a state of nonstop change in an offer to adjust to the constantly adapting ecological setting, for example passage of new contenders, new government regulations, and so forth. A `snapshot’ perspective of these occasions wouldn’t be able to catch the clearing progressions occurring and the impact they had on research endeavor organisations subsequently the choice to study all the execution life-cycle stages. Finally the study unit of analysis is at the national and organisational level.
Madu and Kuei assert that operating on the global market has not come as an easy venture for Indian Information Technology companies. This is because the global market presents a different environment compared to the one they are used to in their local country. Cultural differences and unfavourable policies in the global market have been a substantial obstacle for these companies. There are other companies out there, and are also involved in the implementation of ERP systems. This makes competition very intense hence creating the necessity of stint study before venturing into any market. Companies operating in their local markets usually have a competitive advantage when it comes to market knowledge and access to information. Some IT companies in India have shown great intent in operating in the global market. Tata Consultancy and Infosys Ltd have been the companies that have made a name for themselves in the global market. Both of these companies are believed to be operating efficiently in the USA market. For Tata Consultancy, it is believed to be obtaining 52% of its revenues from the United States market. Infosys Ltd is believed to be deriving 63% of its revenues from this market (Madu & Kuei, 2012). This means that such companies have to fight competition from other IT companies like IBM, Samsung, Apple, Dell and Fujitsu among others. There is also massive competition from companies that concentrate on Software and Programming. This includes Microsoft, Oracle, SAP and Adobe Systems among others. All these companies are involved with ERP implementation. To make things even tantalising is that most of them are from United States. For these reasons Indian companies like Tata Consultancy and Infosys Ltd need to adopt favourable strategies while venturing into the global market. Adopting poor strategies might ruin their chances of success in the market.
Indian companies also have the opportunity of prevailing in the USA market based on how other industries are adopting the usage of the ERP systems. Emergence of a global economy and expansion of the Information Technology usage creates a favourable opportunity for these companies. ERP systems are now being adopted in Banking, Insurance, Military and Air Line industries among others (Wallace, & Kremzar, 2010). For the Banking industry, there is an increased demand for ERP systems due to security and efficiency purposes. Initially, there had been failure in the financial market in USA which resulted to financial crisis amounting from lack of liquidity. This had affected both the personal and investment banking. There was need for them being put under the federal scanner as well as customer and general public watch. After the economy started to gain embryonic recovery, banks are now taking measures that will enable technology to play a vital role in enhancing efficiency and security. They are now turning to companies that offer Information Technology products and services. Major IT products that are being offered to this industry include Alnova, Flexcube, Finacle and Industry Solution software among others. All these software are found under the ERP system being offered by Indian companies. This means that if the companies devise suitable strategies, there is a high likelihood of obtaining a substantial market share from the Banking industry. For the Insurance industry, current economic climate is causing various challenges hence making companies to face decreasing margins, capital constraints, changing competitive landscape and lack of superior customer service (Wallace, & Kremzar, 2010). Companies in this industry have realized that ERP systems can help them overcome these issues. It is believed that the systems will the able to coordinate the agents and insurers by solving problems related to both parties. This will be achieved by improving direct marketing and cross-selling, integration of existing systems and implementation of automated workflows among others. For the Airline industry, nowadays a lot of people can afford travelling by air. Initially, the prospect was only limited to a few individuals due to affordability issues. As the market share increases, there is need for airline companies to adopt systems that have the ability of bringing convenience to all the stakeholders involved. As a result of the rapid growth, the management is bombarded with large data every minute. Lack of decision support systems during this time might lead to poor decision making processes. Checking metrics and data, gathering requirements and managing resources in the supply ends up consuming a lot of time. Implementation of ERP systems would make this an easy task to handle since the management has the control over both financial and industrial activities. The military industry has also come forward in the recent times to enhance its implementation of the ERP. This exercise has proved to be expensive and is aimed at automating all the defence departments. This will take place on all the divisions involving the armed forces. Efficiency is the ultimate driver in this quest of the implementation. Having smooth operations in this wing is paramount and mandatory. The prospect provides an enticing opportunity for the Indian IT companies to thrive in this industry.
Miller asserts that Indian IT companies are failing to produce a global class brand. The companies tend to do very well in their local markets, but fail to replicate the same in the global market. This might be attributed to a variety of factors including cultural differences and unfavourable policies. However, this should not be the case since other native United States companies are doing very well in the very same market (Miller, 2006). There has been a call from a number of researchers to examine the failure of Indian IT firms in the international IT product market, over the past few decades there have been various voices and media publications made on the issue but there is a lack of literature for providing concrete and conclusive answers. As per ( National employability research Aspiring minds, 2012) more than 30 % Indian engineering graduates did not have quantitative skills that are required in IT product development, less than 30 % could perform application of mathematical concepts. Total enterprise IT spend in India is less than 1 % (NASSCOM,2013) and hence most of the target market for IT products remains to be in North America and European market (Business standard,2013). But there is no substantial reason that positively stands on the analogy of international IT product development market for example “SKYPE” which was bought over by Microsoft for USD 8 billion was developed by Estonian engineers a country of 1.2 million people population. The thing that is keeping Indian IT firms one arm distance from the global market is lack of research and development. Quality scientists in India are using most of their time doing “paper work”. There are lengthy procedures of getting sanctions that need to be executed. Some of the scientists even end up committing suicide since their seniors are not allowing publication or ascribing to their research thesis. The government pumps a lot of funds to enhance research and development, but the funds end up being siphoned in one way or another. If Indian IT companies would improve their research prospects in the global market, market failure would be a thing of the past.
Arora says that ERP implementation comes along with a variety of advantages. If Indian IT companies prevail in establishing themselves in the USA market implementing the ERP systems, some advantages would accrue to the stakeholders involved. Among this stakeholders would be companies and sole business owners. To this people, ERP can fix a lot of things in a business. Among them is integrating financial information. When the CEO is trying to ascertain the actual performance of the company, he or she is likely to find different versions of the truth. ERP helps in creating a single version that cannot be questioned since everyone in the organization is using a similar system. ERP also helps in standardizing manufacturing process and integrating information regarding consumer order. Having all the information on customer order under single software helps the company in keeping track of all the orders more easily. Manufacturing companies that are usually interested in acquisitions and mergers tend to make the same widget using different computer systems and methods. ERP standardizes these processes by developing automated steps of doing things (Arora, 2002). This helps in saving time and increasing productivity. Such features emanating from the ERP system would make it favourable and its demand to increase in the global markets such as USA. This would be a breakthrough for Indian companies venturing in the market.
The recent US Immigration bill that was passed this year, would work to diminish efforts by Indian IT companies to implement ERP systems in United States. The bill has some provisions like the H-1B visas. The Visas for high skilled foreigners will be inflated in price. The additional price is quite high and unprecedented. Morgan asserts that the bill aims at penalizing Indian IT companies while it benefits American companies at the same time (Morgan, 2013). He says that the main Indian IT companies being targeted include Tata Consulting Services, Infosys, Cognizant and Wipro. All the four companies have over 50% of their USA workforce on H-1Bs. As a result of the bill, they will not be able to apply for more visas. They will be required to pay a minimum of $15,000 visa fees for any additional applicant. This is very high compared to the $5,000 being charged to other companies (Morgan, 2013).
Some companies tend to ignore the input brought by their employees in everyday activity. This is due to the segregation that is usually brought by the status of these employees based on the work they are designated to do. IT companies have not been left out in this occurrence. Junior employees’ contribution to the company’s proceedings is only restricted to the areas which they have been designated. They are not considered as an integral part of the organization when it comes to making strategic decisions. This is usually a mistake by the management involved. These employees could be of great help in advancements. They are the ones involved with software implementation process directly. Using them to the maximum can help in bringing convenience in those areas that need to be modified so as to bring consumer satisfaction. Most of the top level managers are not quite aware of what goes around on the ground. Using these employees’ ideas would be a step towards actualization of the optimal potential of a company.
2.1 Indian IT Industry Present Status
The Indian IT industry is growing steadily despite there being an economic meltdown in 2009. While the world was experiencing negative economic growth, this industry was able to attain a 5.5% growth (NASSCOM, 2010). Information Technology industry in India has gained its brand identity as a knowledge economy because of the ITES and IT. According to NASSCOM, the IT industry in India contributed US$100 billion to the national revenue in 2012. The top five IT service providers in the country include Tata Consultancy Services, Cognizant, Wipro, HCL Technologies and Infosys (see Appendix 3). These providers are estimated to be making roughly $1 Billion addition to their revenues every year. All the five companies operate at the global market. Most of their market share in the global market comes from the USA market. It is not clear how future operations in the United States market will be for these companies after the new US Immigration Bill was passed.
On a general view, the Indian IT industry is a fledging one. It is characterised by a traditional trading business model. Under this model, there is the target of hiring as many employees as possible at the lowest cost possible. This is quite vivid if you examine the employment trends for Apple Inc compared to those of Infosys and Tata Consultancy Services (See Appendix 2). Apple Inc is their competitor in the US market. The Indian industry is more into selling manpower while making marginal profits in return. The innovation prospects seem to be low since much of what is done is derived from the ideas of developed countries. The industry has very many engineers, but very less intellectual capital.
Numerous Indian organisations have been initiated by visionaries who obtained their wealth and encounter working in bigger made firms and after that set up new organisations. Large portions of the corporate guides did their graduate study in the United States or alternately worked in Silicon Valley, so they have a sharp comprehension of the software advancement process. The high gainfulness and generally level danger of the industry has pulled in an impressive number of experts. Likewise, entrance expenses are generally flat. To begin software organisation does not require immense ventures in area, plant, or apparatus. A large portion of the holdings might be gained on giving then a property on long duration without any advance payment. The lead time for producing incomes is additionally much shorter than in numerous different commercial enterprises.
2.1.1 Growth achieved by the Indian IT Industry
The conception of the software business in India started in 1980 with the section of Tata Consulting Services (TCS) into the realm of outsourced provision relocation function. Tata Consultancy Service had come to attain its popularity in the industry, in the late 1960s. A couple of junior MIT-prepared Indian experts were enlisted, and a substantial machine framework was foreign. With IBM having been tossed out of India, the notion of outsourcing provision improvement work had turned into a need for Indian organisations. Using its abundance Pc limit, TCS started doing outsourced requisition work for conglomerations, for example Central Bank of India and Bombay Telephones. Inside a couple of years TCS started sending adolescent Indian designs to a joint wander friend in the United States, Burroughs, for preparing. The trainee builds outperformed at doing stage transformations, and TCS began winning change assignments for its builds in Germany and somewhere else.
Later another organisation named Tata-Burroughs was shaped. Tata was sharp to adventure the faculty arrangement or “figure shopping” chances though Burroughs was fascinated by offering fittings to the Indian business sector. A couple of efficacious years later the organisation was wrecked at the command of Unisys which had by then obtained Burroughs in the United States and the organisation was rechristened as Tata Information System Limited. A U.S.-prepared Indian electrical design assumed control administration of TCS in 1981. He utilized his impact within the Institute of Electrical and Electronics Engineers to further push TCS and established the Computer Society of India with individual researchers and experts from the Tata Institute of Fundamental Research. Large portions of these experts later moved to government and came to be extremely compelling policymakers. These early systems assumed an extremely helpful part in overcoming intense managerial and procedural demands in India’s generally shut economy throughout the 1970s and 1980s. Taking after the triumph of TCS, numerous different organisations were set up in India.
Starting in the 1970s, a developing deficiency of specialists for the extending machine industry in the United States and Europe, an oversupply of Indian builds with respect to provincial request, and a developing worldwide notoriety for the aptitudes of Indian designs, furnished a chance for form shopping in which Indian organisation, for example TCS sent Indian designs abroad to do software modifying on location, basically in American company for restricted, tasks.
Throughout the first stage (1968–84) of fares, four sorts of organisations interlinked. There were ready made organisations in India, for example TCS and Infosys Technologies which supplied programmers to imposing multinationals in IT and non-IT segments basically in the United States (Xiang, 2002). These multinationals likewise enrolled programmers through neighbourhood US organisations, for example Information Management Resource secured by Indians living in the United States. Such organisations in turn selected labour through neighbourhood inquiry operators (little organisations that are operated by the Indian’s in United States). These executors, from some states in the United States, might contact nearby operators in India from an incomprehensible number of modest organisations and specialists. The avocation of gathering continues, sending them to U.S. position executors, getting for legal documentation to finish with the programmers was finished by the executors in India. The programmers were paid flat compensation. Requisitions were charged by diverse parts of the inventory network. Here and there were mediators spread in diverse towns and urban areas in India? There was an intriguing system around rotating players. Developers who come back to India after a stint abroad might join the pool of software builds that could be contracted by the secured organisations in India. Regularly, programmers sent on location by great Indian organisations might move along the side to an additional duty in the United States through a nearby U.S. executor to drag out their U.S. experience. Later they might come back to India and be in the business for nearby Indian executors to procure them. The Indian Diaspora had assumed a nexus part in the form shopping fares. Arora and others (2001) additionally report numerous occasions where Indian outsiders in the United States assisted U.S. purchasers to spot Indian suppliers. Field talks with U.S. clients reported that the impulse for outsourcing to India hailed from representatives of Indian beginning.
The improvement of form shopping connections between firms in the United States and India was because of the impressive Indian Diaspora in the United States, a hefty portion of whom functioned as experts in the American It industry. They advertised and expedited organisations between U.S. firms and firms or executors in India who could supply programmers for on location work in the United States. The fruitful development of form shopping was because of the abilities of Indian enterprisers and the consistent supply of minimal effort and trainable Indian designers. Figure shopping was and presses on to be an engaging procedure for new contestants into the industry, presupposing nothing more than learning and secured relations with a couple of potential customers.
The intense deficiencies in skilled specialized labour for the developing IT industry in the West and the liberal migration arrangements of the United States fuelled the development of form shopping. For instance, in the 1990s twelve-month development of IT consumptions on supplies in the United States was 24 percent and in Germany and Britain simply under 20 percent. At the finish of the 1990s the deficiency of programmers, frameworks experts, and Pc designers was assessed at around the range of 358,000 in the United States and 30,000 in Canada (Basant, 2003)
2.1.2 The Era of Outsourcing:
While introductory improvement of India’s software industry was built principally with respect to form shopping work on location at U.S. firms, lately the pattern has been in an ever widening margin for Indian organisation lead to software improvement for U.S. customers “seaward” in India. This movement was the after-effect of a developing of India’s software industry and its worldwide notoriety in the most recent 15 years, and the improvement of vital framework and correspondences advances in India that has made seaward work conceivable. As the Indian software industry developed, expanding customer certainty in Indian proficiencies and quality models empowered Indian organisation to move and do their work seaward. With development has come an objective to climb the worth chain. A variety of new organisations were set up in the 1980s by enterprisers with aspirations of making planet class software advancement jogs. Firms which had begun essential as subcontractors for specialized labour steadily moved to supervising finish parts or stages of activities, then afterward to conveying finish results from India. Throughout this stage, generally organisations endeavoured critical undertakings to absorb exceptional practices in task administration and quality and to procure globally distinguished quality models confirmation. NASSCOM assumed a domineering part in pushing the India mark abroad. In a few courses, throughout out the time, India was assembling a starting cushion for the projected take off, of its software administration industry.
In this period the Indian government assumed an expediting part in propelling the industry and empowering seaward job in India. Distinguishing the development potential of the software business, the legislature in the 1980s took nexus strategy activities to open up the area. Further strategy changes sanctioned since the late 1990s have expedited advancement of telecommunications and other framework needed for seaward function.An arrangement change in 1998 that successfully finished an imposing business model on Internet service provider (ISP) passages, permitted India’s private segment to offer required transmission capacity to the developing business. Two years beyond the World Trade Organization (WTO) responsibility, India changed universal long separate in 2002. In 1990 the legislature made software engineering stops (STPs) in 39 areas crosswise over India to give software organisations access to rapid information conveyances and single-window freedom for administrative consistence. While a small number of the bigger firms have made utilization of the STP’s, they have given chances for new firms to start, and more modest firms to develop, with small speculation.
Table 4 shows the movement in the most recent 15 years from customer locales abroad to “seaward” business in India. The income from administrations in India expanded from just 10 percent in 1988, to 33 percent in 1995, to more than 60 percent by 2003–04.
Movement in the Era of Outsourcing
(Express Computer, 2011)
The Indian IT industry is presently in its third stage; that of take off. Today, generally heading organisations are working in the high-finish software administrations business and are likewise endeavouring exertions to enter the items portion. Another type of organisations, advanced by second era software business people, is setting up item arranged organisations. The IT industry has battered ups and downs in the worldwide business, supporting a high rate of development. The IT industry moved focal point of the audience in the local media due to its deceivability in the United States of America, high market promotion and riches creation for its representatives. It is a wellspring of national pride, and as a result presses on to draw in lopsided government consideration. The administration set aggressive software fare targets and has furnished the strategies to empower the industry to attain those targets. Software organisations are progressively being distinguished for their authority in receiving best practices in administration by the media. Indian organisations have fine-tuned the “seaward model” and venture their marks as administration organisations. Organisations have moved further up the quality chain, enhancing gainfulness, focusing on new geologies, vertical realms and organizations
The examination of the written works prompts distinguishing proof that the chances accessible for further change in the event of Indian It industry is fundamentally higher in view of different issues connected with such industry. Consistent with Libf (2007), the gigantic development of ERP industry has additionally given ascent to different issues simultaneously. With respect example, the major issue is concerning the security identified issues connected with the IT space use. With the expanding clients of ERP, the danger in the ERP software counterfeits has likewise expanded fundamentally. The expanding issue with the ERP misrepresentation has been a major issue to manage and this might be determined through get-together of informative content and other knowledge exercises. To hold the ERP framework under check, it is remarkably vital that there ought to be ahead of schedule differentiation and cautioning of new systems for Indian IT ERP Industry cheats and so on. These drives are key not just to increase the trust of open, and yet in securing them from any sorts of issues identified with It industry in USA (Iibf, 2007).
The change of IT administrations in India is also conceivable by focusing on more level and canter earnings bunch individuals, as this specific earnings assembly of individuals speaks for the major piece in the Indian social order and focusing on them might not just permit the Indian administration suppliers to realize higher development, yet it might additionally expedite them with the fulfilment of expense productivity regarding economies of scale. This would at least assist in the expense adequacy in furnishing the ERP administrations and a definitive effect might be better general administrations to clients. Further, the expanding utilization of Cram and information mining might further assist in the achievement of better client administration conveyance and henceforth, an improved general fulfilment of clients could be guaranteed (Nargundkar, 2010).
Company’s Sales Volume
|Number of Companies|
|Annual sales Volume (US$ million)||2005-06||2006-07||2009-10|
|105 – 210||5||6||8|
|52.5 – 105||15||15||24|
|21 – 52.5||27||41||53|
|10.5 – 21||55||71||56|
(Express Computer, 2011)
2.1.4 Research Framework
A structure for the examination is immensely vital as it looks to clarify the classifications of yield that are being transformed from the behaviour of the exploration function. The set of exploration exercises are, no doubt, being characterized by the exploration schema and from the perspective of exploration points and goals, the examination system in the type of a model is essential. If there should arise an occurrence of the given research on operational administration quality in Indian IT software industry, an examination model is acknowledged and it is clarified underneath:
Since, the exploration is dependent on the operational administration nature of Indian IT software Industry’s administration suppliers. The prevailing goals have been there to assess the fulfilment level of the clients in such industry. The administration quality level if there should arise an occurrence of Indian IT ERP Industry could be accessed through the level of reliability held by Indian IT ERP Industry holders, their fulfilment with the substance characteristics connected with such industry, the unwavering quality part of Indian IT ERP Industry holders towards a particular Indian IT ERP Industry administration supplier and at long last, the sensitivity connected with the administration supplier. All these perspectives accelerate the recognizable proof of the level of administration nature of the Indian IT ERP Industry administration suppliers and this in turn accelerates the distinguishing proof of client fulfilment level. This examination system goes about as a replica in the exhibition of the given exploration and the attention of all the administration quality characteristics as incorporated in the aforementioned model might come about into the better recognizable proof of operational adequacy of Indian It ERP Industry in furnishing quality administrations to its clients. Through the provision of this exploration model, the viability of Indian IT ERP Industry might be conceivably picked up since the model measures all the vital elements that verifies thee quality level of Indian IT ERP Industries administration suppliers.
2.2 Indian IT industry Vs Global IT industry (present status)
Key highlight areas for the Indian IT industry are similar to those in the global industry. Among them is enhancing research and development at all levels. Without adequate research, it would be difficult to come up with certain software. ERP systems also tend to become obsolete with time. Changing systems in organizations and complexity in business operations requires continuous revision on the existing ERP systems. Failure to do this would render the systems inefficient in execution of the desired tasks. For this reason, governments in different countries are investing heavily on research and development in the Information Technology industry. India’s government has not been left out in this quest. However, the Indian industry has not focused more on the research and development prospects. Most of the individuals involved in this industry are more concerned with the “paper work”. They want to become heroes in their own way. Being recognised as the best has brainwashed their mentality hence interfering with their ultimate goals. In the long-run, the Indian industry tends to concentrate more on modification prospects. This is quite opposite compared to the global industry. The global industry concentrates more on research and development based on the current trends in the market. The Indian industry will have to up its game so as to keep up with this pace.
Another difference that exists between the two is government involvement. In the global like United States, the government in involved to a greater extent. It is involved in making diplomatic negotiations with governments of other countries where USA IT companies tend to operate. These negotiations are meant to help the American companies have favourable working environment in these countries. When it comes to the Indian government, the situation seems to be quite different. The government in not heavily involved in the global market. Most of the companies operating in the global market are left to find their own way of survival in this harsh environment. This aspect makes it difficult for the companies hence deterring them from actualizing their full potential.
Chapter 3: Information Technology Industry Profile
Information can also be referred to as information and communications technology (ICT). Companies that are involved in this industry offer services such as computer system design, software support computer programming, data processing, web portals, computer consultancy and processing management facilities. Among the major companies involved in this industry there is Unisys, IBM, Tata Consultancy Services, Infosys, Fujitsu, T-systems international and Apple Inc. All these firms are from different countries and all are recognised in the global market. This is an example of just a few there are other thousands of them out there whose performance records are quite recommendable. The economic importance of this industry continues to grow year in year out. The kind of growth experienced in this industry is attributed by the services and telecommunication equipments involved. Among the main services being offered includes outsourcing, installation and training among others. Equipments being offered at the moment include both software and hardware. There is quite of these two categories. In recent period, Enterprise Resource Planning (ERP) systems have been the most common and widely used in the software category. Different industries have adopted the usage of the software in very short period of time. Its progress has been much more quick than it was anticipated when it was been launched. Madu & Kuei assert that this has occurred due to the advantages that can be attached to the ERP. Benefits derived from the software involved in the package seem to outweigh the costs significantly (Madu & Kuei, 2012).
It has been reported that all over the world, expenditures that emanate from IT services is about $3.8 trillion on an annual basis. This report is according to Garter which is a leading exporter of technology services and computer proponents in USA, India, China, Europe and Israel. These expenditures have been high due to increased demand in this industry. The demand for Information Technology services has been triggered by rapid technological advancement in the global market. However, spending is always dependent on the health of the economy. Profitability of companies involved is dependent on innovative services, technical expertise and efficient marketing. Large companies always have a competitive advantage when it comes to global reach and broad service offerings. This aspect provides these companies with an opportunity to outsource services to big corporate customers. Small companies will fare well in the industry if they partner with larger companies or specialize in market niches.
Computer Proficiency and technology skills are vital assets for employees in all industries. Even when the industry involved is not IT related, the job will involve use of computers and other technology related devises. This is more so for companies implementing the ERP systems in their day to day operations. It has been estimated that 92% of IT workers in the world are employed in non-IT companies. They are involved in running of systems and maintenance purposes. 80% of this percentage has been deployed in small companies (NASSCOM, 2011).
3.1 USA Information Technology Industry Overview
In United States, the IT industry is a very important component in the economy. There are a variety of industries that rely on this industry for its services and products. Among them is the banking, airline, military and healthcare industries among others. These industries tend to utilize Information Technology either indirectly or directly. As the industry grows, it also creates a growth prospect for other industries in the economy. In United States the IT industry accounts to around 5 million jobs. Other additional millions of workers are employed in semi-technical and technical occupations that are vertical correspondents of this industry. The SMB sector of this industry accounts to approximately 40% of industry jobs (Madu & Kuei, 2012).
The strength of this sector emanates from its ability to enhance innovation and remain competitive in the global market where the industry is worth $3.8 trillion. However, it keeps on evolving and meets new challenges and opportunities along the way. The economic downturn that had been experienced in the global economy did not seem to cripple this industry. This is because the policymakers came up with initiatives that stipulate growth. Medium-sized and small companies in this industry share similar policy priorities with other industries. However, there are some policy adjustments that help in realisation of sustainable growth. This includes reduction of compliance costs and tax for the medium and small size companies. There is also promotion for expansion of IT workforce. The industry was instrumental in recovery of the economy from the downturn.
The current trending innovation in the market is ERP systems. Implementation of these systems has been there for some time, but they never fail to hit the headlines. Not taking a great insight to the implementation of the ERP one might think it a new prospect in the industry. It effectiveness has been vital for many businesses hence making it this popular. Native American companies are competing in its implementation with Indian IT companies. Indian companies offering ERP implementation in USA have seemed to be very effective. More of this effectiveness is attached to the country’s ability of providing adept and able workforce in this industry. Among the Indian IT companies that have made their mark in the USA market include Tata Consulting Services, Infosys, Cognizant and Wipro. Companies like Tata Consulting Services and Infosys derive much of their total revenues from this market compared to other markets.
Outsourcing in this industry might face several obstacles in the future due to recently passed Immigration Bill. The bill restricts overseas labour outsourcing, which is cheaper for companies. How this holds on is yet to be seen even though it will hurt Indian companies more than the American companies.
3.2 Tata Consultancy Services Company Profile
India has a lot of companies involved in the Information Technology industry. It also has quite a number operating in United States market. All of them are involved in the implementation of ERP systems. For this research, it would be very broad to examine all these companies. For this reason, Tata Consultancy Services will be the focus point for the research. It will be used for collection of data, analysis and making of conclusions and recommendations.
Tata Consultancy Services (TCS) is a multinational information technology company based in India. Its headquarters are located in Mumbai. The company operates in 44 countries all over the world with around 199 branches across the world. Of these 44 countries in the global market, the largest revenue share comes from USA. In India it is one of the valuable countries in the region. It is listed in the National Stock Exchange of India and Bombay Stock Exchange. In terms of revenues, it is the largest Indian based Information technology company. Apart from the revenues, it is also the one with the most employees in this industry. In March 2013, the company had roughly 276,198 employees. This means that it has a substantial contribution to the country’s economy (Morgan, 2013).
TCS was founded in 1968 where its main contracts included provision of punched card services to other companies. In 1975, the company conducted its first campus interview where campus graduates that included 12 students from the Indian Institute of Technology. They ended up being the first employees in TCS to enter the graduate trainee program. In 1981, the company set up the first software research and development centre in India. By the time 2004 approached, e-business activities in the company were generating more than $500 million in terms of revenues annually. TCS went to be listed in the very same year. TCS developed ERP systems for the Indian Tourism Corporation and Railway Catering, in 2006. The company’s ERP implementation prospects have been skyrocketing since this time. During the 2012 fiscal year, the company was able to attain annual revenues that exceeded US$10 billion (Morgan, 2013). This was the highest it has ever achieved.
3.2.1 Heritage and Values
TCS has come to be the largest IT services provider in India on the basis of its collaborative partnerships, outstanding service record, corporate responsibility and innovation. The company’s mission reflects on commitment to providing excellence. Aims at helping consumers attain their objectives by providing innovative services and IT solutions. The core values of TCS include integrity, leading change, respect for individual, excellence, sharing and learning. These values have been critical for the organization in its realization and achievements in both the local and global market. They have played a crucial role in building consumer loyalty. Consumers always want to be involved with companies that tend to care for their needs. This is because they feel quite comfortable, and do not need extra care while dealing with them. When a company becomes subjected to consumer scrutiny, things tend to get out of hand. There is immense pressure which might result to winding up of the business. If that is not the case, then the profits would diminish substantially. However, TCS has worked hard to avoid these occurrences. Using consumer orientation as a business model has worked effectively for them.
Tata Consultancy Services has competitors in all the markets that it operates in the globe. Almost all this competitors are involved in the implementation of ERP systems. The competitors that are going to be analyzed are the ones in the Indian and USA industries. In India the main competitors include Infosys Technologies, Wipro Technologies and Satyam Technologies among others. Infosys is among the leading companies in the Indian It industry which mainly provides engineering and software development to corporations. It provides these services from its regional offices, subsidiaries, worldwide development centres. The company also provides systems integration, project management, data management and support services. It obtains a substantial revenue share from the USA industry. Wipro Technologies on its part provides integrated business, process and technology services. It has also come to be a world leader in offshore outsourcing services. It operates in 55 countries including USA.
Competitors in the USA industry include the ones mentioned above and local companies in the country. The local companies in USA include IBM Global Services and HP Enterprise Services. IBM has a modest goal of making a smarter planet. It operates in around 170 countries and provides a range of IT and consulting services to public sector and commercial clients. Future competitiveness of TCs in the United States market is not certain due to US Immigration Bill passed mid this year. It tends to favour American companies like IBM and creates obstacles for Indian IT companies.
Chapter 4: Research Design and Methodology
A research design is a plan or framework that guides in collection and analysis of data involved in a research process. This research was conducted for the purposes of analysing Indian IT companies implementation of ERP in USA markets. There are a variety of companies in India involved in the Information Technology industry. A good number of these companies has already featured in the USA market in provision of ERP systems. For this reason, it would not be practical to conduct research in all this companies. For data collection purposes, the research uses Tata Consultancy Services for process of collecting data. TCS is the largest Information Technology Company in Indian with total revenue of over $10 billion in the previous fiscal year. Its track record in the USA market is also good based on its market share in the industry. This makes it a favourable prospect to act as a representative of the Indian Information Technology Industry.
During the process of collecting data, the research used survey techniques to execute this process. More emphasis was placed on both secondary and primary data. For primary data, the method used to collect data was filed survey. This provided an opportunity of using questionnaires and interviews conducted on a face to face basis. The main respondents involved included managers and employees of the company. The questionnaires used had to be pre-tested before the final questions could be arrived at. This created the necessity for having a pilot study so as to identify the best questions to be asked. There was usage of both close-ended and open-ended questions in the questionnaires.
- Need for the study
The study is important since Information Technology is becoming an integral part of the global economy. This is both on direct and indirect perspectives. The IT industry is helping in employment creation and acting as a favourable source of national revenue. If Indian companies would identify ways of improving their productivity in the global market, it would be a good stepping stone towards improving the country’s economy. ERP implementation would provide them in this platform due to the popularity that it is gaining. Almost all industries are adopting its usage. As more industries adopt the usage, the consumers involved in the industry tend to increase. This increases the market share of the Indian companies based on the strategies that they are going to adopt. In the long-run, this comes with increased profits. However, adopting unfavourable strategies might ruin everything.
4.3 Research Objectives and Scope
There are several objectives attached to this study. Among them is:
- Trying to get a view of what the stakeholders involved with Tata Consultancy Service tend to think of being the advantages and disadvantages of ERP systems in USA.
- Finding out the challenges that TCS faces in the USA market in its implementation of ERP systems.
- Analysing the future prospects of Tata Consultancy Services in United States Market with regard to ERP implementation.
- Finding out what employees think ought to be done but the management is lagging behind in its implementation for efficiency purposes while operating in the USA market.
- Indentifying strategies that can be adopted by the company to help it in prevailing in the market for as long as possible.
The scope of the study is limited Tata Consultancy Services. The company will act as a representative of the Indian IT companies. It is best suited based on its position in the industry and the achievement it has made so far both in the Indian and USA industries.
The study will provide a framework on the basic concepts of ERP implementation in USA market. The study is very relevant since the global market has embraced Information technology with a bang. Growth of economies calls for ample IT systems to help run all the processes effectively. ERP systems can serve effectively in this realisation.
4.4 Situation Analysis
It is quite clear that organizations usually find it difficult as they try to operate at the international level. The global market is marred with a lot of obstacles for all the companies that attempt to venture in it. This is caused by differences that exist between the global markets and the local markets that these companies operate in. Among the major differences are cultural and political factors. A culture might impact an organizations operation very adversely. This is because what works in one market might be very different in another market. As a result, a company must deploy different strategies in two different markets even if the products and services being offered are similar. Failure to embrace this ideology would lead to total market failure. Policies devised by governments of respective countries might also tend to be detrimental to the operation in the global market. They might be in contrast with what these companies are used to. Most of these policies are meant to protect local companies from foreign domination. It becomes difficult to work under such a market.
Indian IT companies trying to operate in the USA market are being faced by a similar scenario. There are other American companies offering ERP implementation. They tend to have a competitive advantage due to the favourable policies being devised. Their understanding of the people’s culture is also better compared to that of the Indian companies. For this reason, Indian companies must be good at what they do for them to attain a substantial market share.
4.5.1Type of research
- Descriptive Research
This type of research is more involved in conducting research into the market in an attempt of obtaining an overview of the entire market. Some factors that affect the marketing environment tend to gain more attention when conducting such a research. This type of research tries to show that various variables in a market are interrelated. It shows more how a change in one variable is likely to cause changes to other related variables. Research methods that can be adopted in this case include surveys, history, archival information and experiments. It tends to have some limitations since the only thing that it can show is that certain variables have a certain relationship.
- Exploratory Research
This type of research comes in handy where a researcher wants to dig deep into the topic of the study. Research methods used have no clear definitions since they are subject to different interpretations. They also tend to be unstructured and qualitative in nature. Researchers do not have any pre-conceptions once they start working on the research. This helps them not to make any assumptions, and try to find all their answers from the research process. Having a good research design, data collection methods and representative sample of the entire population is critical to this type of research (Kothari, 2008). This is because there is prior knowledge regarding the research hence everything ought to be done in the best way possible. Focus groups, pilot studies, interviews and case studies can be conducted towards the relevant stakeholders in the study.
4.5.2 Methods of Data Collection
To understand the implementation of ERP by Tata Consultancy Services in USA, there was usage of both primary and secondary data collection methods. Using both sources helped in obtaining more information regarding the topic.
- Primary Data Collection Sources
- Filling out of questionnaires
- Interviewing the research subjects
- Observing respondents’ behaviours as they answered the questions
- There were discussions involved with the stakeholders of the company i.e employees and managers
- Observing the employees motivation aspects as they undertook their duties
- Secondary Data Collection Sources
- Company profile
- Work records and charts
- Information on the brochures belonging to Tata Consultancy Services
- Company website
- Information from other internet sources
- Annual reports for the company
4.5.3 Qualitative and Quantitative Research
This research can also be examined under two approaches, which is qualitative examination and quantitative examination. Assuming that there may as well roll out an event of qualitative research, the informative content under examination is especially subjective by nature and it is not possible to perform any sorts of numerical examination. The informative data are subjective and they have to be assessed in a subjective manner. Divided from this, the quantitative qualified data is numerical by nature and this kind of examination incorporates the display of numerical examination through the procurement of distinctive true instruments and techniques. Both these examination systems are astoundingly utilised if there may as well go out an event of investigation work and they facilitate honest to goodness examination of the accumulated informative to accomplish a particular finding. In the occasion of the given research on exploring operational organization quality in Indian It modifying industry, both these examination techniques are utilised. The order of qualitative method is sufficient in subjectively testing the operational sufficiency of Indian IT customizing industry and quantitative dismemberment may mull over numerically softening down the qualified information got together the investigation.
4.5.4 Justification of Methods Used
Methods that have been used for data collection in this research tend to fit the research scope quite well. Among them is using Tata Consultancy Services as a representative of Indian companies in the research. This is because it operates in both the Indian and USA market. It has a good reputation in both markets too. These are among the aspects that make it favourable as a research subject. For primary data collection, using the questionnaire was a good move since it gives respondents an opportunity of explaining themselves since this questionnaires cannot be traced to them. They are not required to write their names hence it would not be possible to tell who was dealing with a certain questionnaire. Interviews are also favourable since the feedback is instant. There is a personal appeal developed in the process where the researcher has the ability of observing non-verbal cues (Kothari, 2008). For secondary data collection, using the company’s website would help in collecting the most accurate information. However, using other internet sources that are not directly related to Tata Consultancy Services may help in obtaining more relevant information. This is because the company’s website might be bias on some information.
The strategies that are utilized as a part of instance of the given exploration work is both the qualitative and quantitative exploration strategies in light of the fact that the provision of both these exploration routines is remarkably supported regarding getting profoundly true discoveries. The subjective dissection and in addition numerical examination assists in distinguishing the correct operational productivity in the event of the Indian It software industry. An improved examination is conceivable through acknowledging both these information techniques and in that capacity, they are connected in the event of the given examination. Further, the way of the examination additionally underpins the provision of both these exploration systems.
4.5.5 Actual Data Collection Process
The actual data collection process was conducted in Tata Consultancy Services. The sample size used for the process involved 100 respondents. Among this, there were 95 employees operating in different departments. Only 5 respondents emanated from the management team. The number was minimal since it hard securing appointments with the top level management due to time limitation on their side. They have a lot to do hence a few were able to avail themselves. Questionnaires involved included 10 questions where open-ended questions were used (see Appendix 1). Opting for open ended questions was preferred due to uniformity which would enable efficient analysis of data. These questionnaires were distributed randomly among the employees in different departments. They were all distributed then collected after 4 hours. This was enough time for all the parties involved to have completed the process of filling them up.
For the interviews, they took place in the respondents designated areas of operation. It was done this way so that there was no disruption of what was being done. This would also have presented a great opportunity for examining their motivation factors as they conducted their research. For the managers, the interaction involved more of discussions. This was the best way to get as much information as possible.
After collecting data from the primary sources, more was done in collecting data from the secondary sources. Comparisons were made between data derived from the two sources, which would help in the analysis process.
4.5.6 Analysis of Data
Data collected through the questionnaires was compiled and interpreted. It was compared to data collected from other sources. During the interviews, note taking was the key prospect. Notes collected from the interviews would be used in the analysis process. Results were subjected to statistical analysis and were later presented in graphical form.
Statistical tools and techniques used for the research included tables, sheet and graph among others.
4.6 Ethical Considerations
Some of the ethical considerations included how the information collected from the respondents would be used. For this study, the information would only be used to analyse the Indian IT companies with the implementation of ERP in the USA Market. Any information from the respondents will also be kept confidential. As a researcher, I am quite aware of the dangers that come along with disclosing information emanating from a certain respondent.
Another ethical issue is whether there will be any bias when publishing the information after making the analysis. The answer to this question is that there will not be any biasness since all the information will be published as it is.
Is there any foreseeable risk; be it mental, physical or social that might accrue to the respondents on the research due to their participation? The answer is clearly no. Instruments used for the process will not have any risk towards them, and neither will the process itself.
Would it be necessary to deceive respondents regarding the aim of the research so as to make them participate in the process? This cannot happen since it might even end up producing wrong results based on the data that will collected.
Would it be necessary to get consent from the respondents and the company involved before conducting the research? The answer to this ethical question is actually yes. This is because some companies have some policies that might be hindering other individuals from conducting research from their premises. Failure of following the prescribed procedures would lead to a poor execution of the research process.
Is privacy regarding the individuals that are going to participate in the research going to be observed? This is mandatory for any research process. To begin with, the questionnaires involved should not have an option that requires the respondents to fill in their names. This way it would be possible to trace who said what during the research. The researcher should also not reveal the individuals involved in the oral interviews. It might put them at risk of losing their jobs based on the information that they provide.
- Limitations of the Study
Despite conducting a successful, there were limitations encountered along the way. Among them is that:
- The information was only collected from Tata Consultancy Services, which acted as a representative sample of the entire India IT industry.
- Some of the respondents were reluctant in giving out information.
- Some employees also did not have adequate knowledge of the ERP implementation conducted by Tata Consultancy Services.
- When analysing the data there was also an assumption that the data derived from the respondents was accurate.
- From the sample size involved, maybe the results would have been different if the entire organization was involved in the process. Sometimes it is difficult to tell whether respondents involved are a representative sample.
- Level of Education of the Employees
Question: What is the highest level of academic degree that you hold?
- Undergraduate Degree Masters Degree
- Doctorate Professional Degree
Degrees held by Employees
|Highest degree Held||% of Respondents|
|Professional Degree (Md, JD)||9%|
More of the employees in Tata Consultancy Service tend to have an undergraduate degree. This result is derived from the 100 respondents that filled their questionnaires completely. 46% of the employees had undergraduate degrees, 31% had masters degree, 14% doctorate and 9% professional. This tendency is created by the fact that, employees in the top level management need to have high education levels before they can attain their status. The level of education requirement diminishes as you come down the food chain.
- Employees Awareness of TCS Systems
Question: Are you fully aware of how systems in Tata Consultancy Service Operate?
- Yes Not Sure B. No
|System’s Knowledge||% of Respondents|
Most employees working in the organization seem to understand how the systems found within tend to operate. 81% of the respondents said that they were quite aware of how systems in the organization operated. 7% said no while 12% said that they were nor sure. Most of the respondents that said no or not sure, had not been long in the organization and were taking their time to learn and get equipped with all the necessary knowledge of how the systems operated.
- Advantages and Disadvantages of ERP Systems
Question: Does the advantages of ERP implementation surpass its disadvantages based on what you have seen so far in the organization over the periods you have been working in the organization? (or maybe from customer’s comments)
- Yes Not sure
Superiority of ERP Advantages
|Advantages of ERP Superiority||% of Respondent|
From the information derived from the respondents, seems that most of them were quite sure of whether ERP implementation had more advantages or disadvantages. 84% were of the view that it had more advantages. 5% thought that the disadvantages were more while 11% were not sure which side held more weight. All the responses were based on their experiences in the organization. Others based their responses from the responses they had received earlier from the clients who had outsourced ERP implementation from the organization.
- Main Competitor of TCS in the USA Market
Question: Who do you consider Tata Consultancy Services main competitor in the USA market from the list provided below?
- IBM Wipro
- Infosys Accenture
Competitors in USA
|Main Competitor||% of Respondent|
Competitors in USA
From the data gathered, there is clear evidence that respondents have different views of who is the main competitor of TCS in the USA market. 55% believe its IBM, 27% Infosys, 8% Accenture, and 10% Wipro. Difference in view is triggered by what the respondents analyze before making their conclusion. It is true to say that, if different aspects are analysed, the results and responses from the respondents will keep on changing.
- Major Stumbling Block to the Company in USA Market
Question: Between culture, information overload, competition and government policies, what seems to create the major stumbling block for Tata Consultancy Service efforts in implementing ERP in United States?
- Culture Information Overload
- Government Policies Competition
Stumbling Blocks to the Company
|Major Stumbling Block||% of Respondents|
Stumbling Blocks to the Company
According to the respondents involved in the research, government policies seem to be the main stumbling block facing TCS. From the interviews it was clear that some of the policies did not favour the company since it was a foreign one. They feared that this would worsen with the current bills being passed by the senate e.g. immigration bill. Only 11% thought culture was the main stumbling block, 10% information overload and 15% competition. Government policies carried the day with 66%.
6.Effect of US immigration Bill
Question: Is the new US Immigration Bill that was passed by the US Senate going to affect Tata Consultancy Service ERP implementation negatively?
- Yes Not Sure
Effects of US Immigration Bill
|Negative Effect of the Bill||% of Respondents|
| Not Sure
Effects of US Immigration Bill
Many of the respondents tend to believe that the new US immigration bill might have a negative effect on TCS operation in USA market. 69% think there will be a negative effect, 20% think No while 11% is not sure regarding the issue. Most of the people that are not sure have not given an insight into the problem. This was outright when conducting the interviews.
- Industries’ ERP implementation Outsourcing Level
Question: Among the industries listed below, which one has been outsourcing ERP implementation services from the company more?
- Banking Military
- Airline Insurance
ERP Outsourcing by Industries
|ERP Outsourcing by Industries||% of Respondent|
ERP Outsourcing by Industries
From the respondents it was clear that other industries have taken into outsourcing the implementation of ERP systems. However, there seems to be varied views based on which industry is doing more of the outsourcing process with the company. The respondents had different views based on how they assessed their statistics and future prospects. 49% were of the banking industry, 23% airline industry, 9% military industry and 19% Insurance industry.
- Implementation of Strategies
Question: In your own view, has the company applied the best strategies in its implementation of ERP in the USA market?
- Yes Not Sure
Implementation of Strategies
|Strategy Implementation||% of Respondents|
Implementation of Strategies
60% of the residents think that the company has adopted the best strategies in trying to conquer the USA market. 26 % are of the opinion that the strategies adopted are not the best. During the interviews some even had some proposals on what ought to be done. 14% of these respondents were not sure. Examining them from a different perspective, they did not care what the company was up to. They gave an impression that they are just those employees that are just there to fulfil their daily requirements and that is the end.
Chapter 6: Findings
6.1 US Immigration Bill
When the Immigration Bill was passed by the Senate, experts had a lot of views regarding the issue. This was a similar case from the respondents when the research was being conducted. 69% of the respondents thought that the bill would affect Tata consultancy negatively. 20% thought it would not have any negative effect while 11% were not sure. Majority of the 11% that were not sure had not taken much consideration of the issue. This is expected since not all employees are interested with what goes around outside the business premises.
From the secondary sources, a news article by Morgan outlines that the government’s main objective of bringing forward this bill was to ensure that the local companies in the Information Technology Industry are protected. A provision in the bill outlines that the H-1B visas will hike in price. This will certainly affect high skilled foreigners that tend to migrate to USA. Morgan thinks that this is a strategy brought by the government to diminish the success of India IT companies in the USA market. Indian companies like Tata Consultancy Service are fond of importing most of their man-power from their home country India. This is because the employees possess all the attributes that desire for the implementation of the ERP systems. Once the Bill becomes effective, they will be forced to pay $10,000 more for visa fees compared to the local companies like IBM (Morgan, 2013). Paying such extra huge amounts on one visa would increase the cost of operation substantially. This will affect the company’s profit negatively. Another option that could be available for the company, is increasing American employees, and reducing the need for India employees at the same time. This could also affect the company negatively based on the performance level. There is a reason as to why the company likes using more of Indian manpower.
However, this might also affect the USA economy negatively. This is because the Indian IT companies in this market tend to create employment opportunities to the American citizens. If their efforts are crumpled, providing these opportunities will also become difficult. The companies might opt to reduce the number of American employees in order to reduce the costs. Savings derived from laying-off the workers might be used to cater for the additional fees imposed on the H-1B visas. For this reason, the USA government should always assess all the possible occurrences before implementing such policies. They might try to protect local companies, and deteriorate the economy in the long-run at the same time.
6.2 Tata Consultancy Service Competitors
In USA market TCS has many competitors. These competitors include both local and foreign companies. For the local companies, IBM is among the greatest competitor. Other companies from India are also posing potent competition towards the company. They include Infosys and Wipro. There is also competition from other foreign companies not based in the Indian industry like Accenture. According to the respondents that participated in the research, they felt that IBM was the major competitor for TCs in the implementation of ERP in USA market. 55% of the respondents were of this view. Infosys had followed closely with 27% rating among the respondents. According to the company’s management during the interviews, they felt that IBM was stronger competitor compared to the others due to its existence as a local company in the country. There was a notion that policies being devised might tend to favour the company since the government has a duty of protecting the local companies from exploitation brought about by the foreign companies. It tends to neutralise the ground making sure that foreign companies do not have any advantage over the local companies. After achieving this then it tends to create a competitive advantage for the local companies.
There is belief that the years that IBM has operated in this market also plays a part in making them the greatest competitor. The history of IBM in USA market dates back to 1880s periods when electronic computers had not been introduced. Ever since this time, the company has been transitioning and becoming even better. This is a long time to have been in the market for any company in any industry. This means that the company has had the ability of gathering all the necessary information regarding the Market. Their decisions are informed due to availability of a large pool of information. Information is very vital for success to be attained in a market. Most of their information is first hand since they have been able to experience everything. Companies like Tata Consultancy Service and other foreigners tend to rely on secondary data which might not be true. IBM has also been able to establish consumer loyalty which might take a lot for the foreign companies to break. This is because they are up to date with all the new things that are taking place in the industry and adjusting accordingly.
For the respondents that think Infosys is the main competitor for TCS in the USA Market base their argument on how well these two companies know each other. In the Indian IT Industry, these are the two leading companies. For them to be there, it means that they have done a lot to achieve the status. They understand each other’s strategies and moves when certain market situations present themselves. These aspects made 27% of the respondents think that Infosys is still the main competitor of Tata Consultancy Service in USA market as they are in the Indian Market.
6.3 Advantages of ERP Implementation
An overwhelming majority of the respondents tend to think that the advantages of ERP implementation exceed the limitations (84%). Only 5% think that the disadvantages outweighed the advantages. 11% were not sure of which side was more compelling. Most of them had not been long in the organization hence did not have a good understanding of the entire system. They had to stay for sometime before they could make any conclusion on the issue. The responses from those who pointed on YES or NO came from their experience with the systems. Some of the responses were based on consumers that had outsourced the ERP implementation feedback.
Among the advantages that the respondents outlined during the interviews was efficiency and time saving. Efficiency comes in where companies are given the ability of integrating information regarding consumer order. As an organization grows and increases the size of its consumers, monitoring these consumers tends to be a problem. If it is not properly checked it would result to some consumers not being satisfied with the way their orders are being handled. However, ERP has removed this restraint through its array of software packages that help in executing duties. Time saving is being enjoyed more by companies that are involved in manufacturing processes and are operated on the basis of mergers and acquisitions. This is because the processes being used are standardized hence avoiding duplication of efforts. ERP helps in saving time by developing automated steps to be fooled in all the plants involved in the process. According to the respondents ERP systems also have the ability of reducing costs significantly in an organization. Among the costs reduced are the ones involved with the inventory. Other cost savings come through better control of material, acquisition, increased productivity, reduced lead time and improved quality.
Among the disadvantage that the respondents outlined it time taken to implement the ERP systems and start using them. It was clear that the time given in their manual is approximately six months. However, the respondents argued that in many occasions it takes longer than this. The cost of installing the systems is also high for businesses. It comes along with a great investment something which tends to lock out many small and medium enterprises from implementing the systems.
Based on the above findings, it is clear that Tata Consultancy Service has an opportunity of flourishing in the United States Market with the implementation of ERP systems. This is because the advantages that come along with the systems will tend to bring more and more people to start using them. As more people come in, the markets share in the industry will tend to rise. If the company develops appropriate strategies, then it will be able to benefit in the future.
6.4 Stumbling Blocks in USA Market
Just like it is the case with operating in the Global Market, Tata Consultancy Service faces a variety of stumbling blocks in its implementation of ERP systems in USA. Operating in any international market is not an easy stance to pull. Among the common stumbling blocks experienced in the global market is cultural difference, information overload, and competition and government policies. Respondents to the research think that government policies take the leading patch in this scenario. A massive 66% are of this view. 15% think its competition, 11% culture and 10% information overload. On a normal scenario would think competition would take a leading toll. However, employees had a different view on the issue. From the interviews, they explained that the company was making substantial strides in keeping up with the competition. It does not have many problems in marching what the competitors are doing. However, the policies that are being devised by the government are the ones giving local companies a more advantage.
This information is also available from other secondary sources like an article in New York Times outlined that the government is enforcing steeper regulations for foreign companies operating in the IT Industry. They are being forced to employ more of the local employees and paying additional revenues to the government. This source outlined that this might end up hurting US economy in various ways. It is very clear that the Information Technology industry is a backbone to the country’s economy. This is in terms of employment creation and revenue generation. Such steep policies might force Indian companies like Tata Consultancy Service to shift their focus on other markets in the globe.
6.5 Implementation of ERP by Other Industries
From the research, it is clear that other industries have been involved in the usage of ERP systems in their companies. They are outsourcing the services from the Information Technology industry. The level of usage in these industries seems to be varying. According to the respondents, the banking industry has the highest implementation level from the Indian IT companies. It stands at 49% while the Airline industry comes in second with 23%. Insurance and military industries follow in suit. The banking industries being the highest industry in outsourcing these services is not a surprise. This is because the ERP has a lot of features that make work efficient for the industry. It is an industry with many consumers and undertakes many transactions in a single day. The efficiency that comes along with the usage of ERP makes quite attractive in this industry. It is also evident that even other industries that might not be very common with many people as to how they work like the military industry are being involved with ERP installation. This is an indication that even other industries that seem irrelevant under this array will at one time come to embrace these systems. This will mean that the number of consumers in the market will tend to increase over the years. Indian IT companies operating in the market will have a chance of increasing their market share, as a result.
6.6 Strategies Adopted by the Company
From the research analysis it can be seen that 60% of the respondents are confident with the strategies being adopted by the company in trying to implement the ERP systems. However, 26% of the respondents are not convinced by the strategies put forward in competing in the market. According to them, there are some things that the company ought to do, but are yet to implement. They think that there are some areas that are lacking in resources, skills, management, and others feel that system is not very convincing. This might be their opinions, but to some extent might be true. Or it is that notion whereby not everyone in an organization gets satisfied with all the activities taking place.
Chapter 7: Conclusion and Recommendations
This part of the research tends to highlight the main lessons learnt from the research process. A lesson that can be learned by individuals that want to gain knowledge from the research is that, it is clear from the research that Indian IT companies have been involved in the global market. This has been attributed by the growth being experienced in this industry. Expansion in the local market has necessitated the need for indulging in the global market. The Information Technology industry plays a vital role in the development of Indian economy. This is through provision of employment and revenues to the government and other relevant stakeholders. For this reason, the government has taken the initiative of supporting the industry in terms of finances and policies being put forward. A lot has been invested in enhancing research and development in the industry. However, there comes another problem whereby, the Indian government does not have control of the global market. Here the companies involved have to tackle issues involved on their own. Among the issues there is competition, cultural diversity, access to market information and unfavourable government policies. It has also surfaced that Indian IT companies tend to compete amongst themselves in the Global market. 27% of the respondents from Tata Consultancy Service tend to view Infosys as the main competitor of Tata Consultancy. There is no corroboration of these companies when they are out there in the global market.
However, involvement of Indian companies in the implementation of ERP in USA seems to have a bright future. This is based on the facts that exist from the demand of the ERP systems. Many industries such as the Military, Banking, Healthcare and Airline industry among others, have taken the consideration of ERP systems with great content. This is due to the efficiency that comes along with these systems. However, the good prospects do not mean that these companies have an easy task while exploring the USA market. They have to devise strategies that will help in combating competition emanating from companies based in this market. They have to create their own source of competitive advantage. Indian IT companies also suffer from unfavourable policies set up by the US government. This makes it difficult for them to compete fairly with other companies in the industry.
Individuals aiming at conducting future research into the Indian IT industry should not focus solely on the ERP implementation in the global market. There are numerous activities that this industry gets involved with in the global market. There are also other software that the companies are offering, and they are doing favourably good in the USA market. Broadening the scope of study would help in gaining a clear picture of the industry. It would help in assessing a lot of things that cannot be analysed when focusing on ERP implementation only. However, this research would not be an easy one since a pool of data is required. Trying to integrate data from two industries with different set of systems would not be easy. Obviously the research cannot be conducted on all the companies that exist in the industry. Even if it was to be done, it would make analysis of the data very difficult. Settling on the companies to use for the research is also not an easy task since there is no uniformity in everything that is being done. Population involved in a research should be a representative sample of the entire industry. Out rightly the researchers involved will have a difficult time in making this a reality.
Another thing is that researchers aiming to conduct a similar research in future should avoid over reliance on the company’s website while collecting secondary data. The company’s website is good for information relating to the financials and other internal affairs. However, it came to my attention when conducting the research that it is not all the information emanating from the company’s sources is true. Some information was contradicting with information derived from other sources. There was also a conflict between what the respondents to the interviews were saying and what was reflected on these sources. It was clear that sometimes the company tries to “sugar-coat” some information in light of the stakeholders and the general public at large.
Future research under this topic should also consider the limitations that come along the way. Among them is non-compliance from the respondents. Some respondents are not willing to give out the entire information regarding the issue. They tend to fear the consequences that might befall them after giving out this information. This is because they are not sure why the research is being conducted in the first place. It is upon the researcher to analyse the situation gain their trust in the issue. He should try and convince them that all the information gathered from this process will be kept confidential. This helps in freeing their spirits based on the fear of the unknown.
Another limitation that might come along with such a research is relying on the respondents’ information to be true. This information is used in data analysis, outlining findings and giving recommendations. When the information provided is wrong, all the other processes that follow in the research might be misleading. The findings will not be true hence affect research since the report will be used in the literature review of future researches. It is good using some logic when conducting the research. An analytical mind can help in identifying misleading information from the respondents.
Choosing the population to be used as the sample is also a limitation in this kind of research. Every sample used should be a representative of the entire population involved. Dealing with an entire IT industry is not feasible. Therefore a sample must be derived. Lack of uniformity in all the activities conducted in these companies makes it difficult to get a representative sample. Individuals striving to conduct such a research in the future should be aware of this so as to plan adequately in order to avoid the consequences that come with it.
The recommendations from this section are directed to the Indian Information Technology industry and other relevant stakeholders involved with the industry either directly or indirectly. These recommendations are based on findings obtained from the research.
One of the recommendations is that Indian IT companies should increase their involvement in the USA market. The market has the potential of growing even further based on the current prospects. There is a hype that is going around regarding the ERP systems. The advantages that come along with the implementation of these systems tend to be more compared to the limitations experienced. This has prompted companies from different industries to be enticed in to demanding the implementation of the ERPs. If this situation continues to prevail, the consumer base for the ERP systems will increase. This means that Indian IT companies need to be involved in the market more than it is doing currently. Increasing the efforts and improving the current systems means that the companies will be able to increase their market share substantially. As the market share increases the profitability aspects will increase. This whole thing will not only increase the profits but also sustenance in the USA market for as long as possible. It would become difficult for the companies to be pushed out of this market due to the coherence that will be there.
Another recommendation is that the Indian government should be concerned with the activities of this industry in the USA market. The IT industry has played a huge role in enhancing growth of the country’s economy. The government therefore should protect it more in intervening in some diplomatic issues. From the research it has been clear that government policies in USA create more obstacles for these companies to thrive. The government brings out policies that seem to favour local companies in the expense of the foreign companies. The Indian government should intervene since these issues can be solved diplomatically. It has to make some negotiations with the USA government on some policies that they trend make and fail to favour Indian IT companies. Negotiations usually involve give and take processes where the Indian government must offer the USA government that will make them heed to their requests. These are issues that only the government can be able to handle. Failure to do this will polarize operations of Indian IT companies in the USA market. As the policies become even tougher with time, some companies might be forced out of the market completely.
Competition also seems to be stiff in this market. Main competitors for Indian IT companies seem to be the local companies in the country like IBM. There is also competition among the Indian companies involved in the market. Indian companies need to weary of the local companies. This is because these companies have been in the industry for a long time now. They have gathered vast experience and knowledge regarding the market. The only way to beat them is by trying to emulate their strategies. Indian companies should not be rigid, and persist on implementing similar strategies as the once in the Indian industry. This would lead to total failure since there are cultural differences among the consumers of the two markets. Before making any conclusion on the strategy to adopt, a stint research into the market should be conducted. Failure of being thorough with the research might lead in making poor conclusions. This is detrimental for both the short-term and long-term operations of the companies. Strategies being devised to curb competition should also have an insight into the future. They should be long-term in order to allow these companies to be relevant in the USA market for as long as possible.
It has also been evident that ERP has more advantages compared to the disadvantages. This is according to the respondents to this research. However, this does not mean that the systems do not have disadvantages. Indian IT companies should try and limit the limitations that come along with systems. Among them is the time period taken by the systems before they become fully functional. It has been outlined that the estimated time is usually between 1-3 years. This time is too long for the organizations to wait. Indian companies involved in this industry should try and modify the software involved in this process. Modification should be enhanced to make sure that the time taken for the implementation reduced. Some prospective companies are de-motivated by this time. Cost also acts as another barrier for many companies that are willing to implement the ERP. It should be taken into consideration that cost is a significant factor in any company’s decision making process. Finding ways in which the cost can be reduced will play a significant role in enticing companies to implement the ERP systems. If these companies were able to make these modifications, they will create a competitive advantage in the market. It will be easy to compete with American companies in their own local market.
The research shows that the banking industry has adopted the usage of the ERP systems quite well. There are other prospective industries that seem to be entering the market slowly. Indian IT companies should approach companies in those industries where the ERP has not been adopted in a larger proportion. They should have the ability of convincing these companies as to why they need to adopt the strategies. It should be the companies’ target to make it easy for these companies to join in. Being able to lure them in will create an additional market share which they can benefit from. It also brings diversity which presents a security for future operations.
These companies should also consider some views from the respondents. For instance, 26% of them did not think that the strategies being adopted in the company are the best in the USA market. There has to be some reasons why they posses such attitudes. It is the duty of the companies to assess any important information that the employees have, and might be helpful in the day to day running of activities. It is not prudent to ignore employees’ contribution based on their status and position in an organization. They might have great ideas that can propel the organization to greater heights. Making good use of every employee is vital in this industry.
As a recommendation, Indian investors should also consider putting some substantial investment in the Information technology industry. This is industry is growing each and every day. People have started to see the need for technology and all that it can do for them. This means that in some years to come, the industry will be immersing a lot of revenues. Most of the developing countries have not yet embraced IT appropriately. As time passes by, they will all have the opportunity of doing so. This means that the volume of the global market will tend to increase in the future. More profits will be derived as a result. However, the people that stand to benefit are the ones that are going to make their investments today.
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