INTERVIEW
Tata’s earthquake to reach SMEs
by John Garratt
john.garratt@iteuropa.com
It might just work. Indian IT giant Tata Consultancy Services (TCS)
has its eye on the vast sums being spent on IT by the world’s small
businesses. The company that brought you the world’s cheapest
car at €1000 is now looking at providing a complete hardware,
networking and managed service, plus a package of software
designed for small business. It’s already in use in India, and is being
tested in Portugal before engaging with the big SME markets in
Europe. But a lot of research has gone into the idea, says TCS Global
Head, Small Medium Business - Venguswamy Ramaswamy (right).
Should the SME vendors and channel start to worry? They might......
I
t couldn’t have been done a few years ago, but common business applications such as HR, CRM,
such has been the improvement in bandwidth payroll and common office applications, it aims to
globally that a viable model to give IT to SMEs hit the spot with most. Coupled with six individual large data centres to keep the SMEs’ information
on a large scale is now possible. Bundling hardware, vertical applications in areas such as education, within the EU for compliance reasons. But other
network and core software in a low-cost scaleable manufacturing, retail, healthcare, it will aim for sorts of partner might be getting involved
package, TCS reckons its can transform the model. critical mass, and develop others as required. – Google for example, which is preparing a
The revenue model that Tata is proposing is And by offering back-up of data, and a secure software desktop for users; Salesforce.com, which
similarly breaking with tradition – the fee will be system it will put forward to SMEs the view that has proved the way with hosted applications for
applied over a period – usually monthly, so it their data is actually safer than if left to their local business. “But we will ensure that the intellectual
comes out of revenue, and is not a capital expense. systems and management. property stays with us; we don’t want anything in
It can be based on the number of transactions, or Hardware and networking will come from a the clutches of the any other partner.”
number of users, or payroll, or a percentage of the catalogue – no details of the actual supplier have It will identify a price that the SME can pay, and
income of the client. been given yet, but the SME’s existing systems may wants control over that. Bit the model may prove
The attraction for Tata is obvious – looking at meet the required spec, so it is not all a rip and interesting to businesses that are a bit more than
the vast spend of the smaller companies which is replace. And bandwidth levels world-wide are now SMEs – although Tata says it is addressing markets
larger even than the top 2000 global companies. good enough to make the remote management where the customers are below $500,000 in size;
The SME sector is also growing its IT spend at a reality in most places. Interestingly it is being that is pretty big in most European countries.
around 24%, or three times the rate of the global tested in Portugal, as being close to the Indian And it will also service the micro-business with
giants. Tata has also been researching the nature market in nature. “And we also needed to get it a few million dollars in sales, and where remote
of the SME customer – it finds most are dealing right in a smaller market before trying it on the UK management might not be needed.
with an average of seven-twelve vendors, while not or Germany. Germany has the biggest SMB market
OUR ANALYSIS
being in a position to manage the IT properly, nor in the world,” he says. It has already stated in India,
being attractive enough to retain IT talent. This is but that may be a special case as the Indian SMEs So in six months, when Portugal is established,
a global problem for SMEs, “and integration of the recognise the power of Tata as a brand and are and its experiences absorbed, the drive could
solutions is a nightmare”. keen to sign up for its services. start into the rest of Europe. But Tata has a five-
So this is being presented as IT-as-a And eventually, IT-as-a-service could be sold year plan, which sees it in South America, Africa,
service - “build IT as you grow”. It will not be through channels, though not before it is firmly and operating globally. From Tata’s perspective, it
over-engineered – most enterprises have far bedded down – at least a year. “We’re looking at all has never really addressed the SME market with
more functions than they actually use. But by the options.” its brand; it will make it look very attractive, and
concentrating on certain key functions and And it will also require localisation, as well as has the resources to make it work.
16 02 MaY 2008
It0808 - 16_Tata.indd 16 2008-04-30 12:01
Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32