Technology Management

Assignment

Innovation and
Technology
Performance
analysis of
TCS

June 15,2020
—
Pranjal Agarwal(K-12736)
—
Dr. Marina Ranga
1.0 Introduction
I chose this company because it is the best IT company in India and also because I have a job
offer from them. TCS is soaring in the competitive waters of the IT world and it is only
because of their brilliant strategy of learning and relearning. Unlike some old organizations,
such as itself, they prefer continuous innovation and have a whole department in almost all
their branches dedicated to the same.

Tata group has made innovation a part of their DNA. In FY 2019 10% of its revenue was
directly traceable to innovation activity.(Krishnan TCS in an interview with Business Week)

Throughout this report I am going to talk about their strategies, business models, Innovation
plans (with a personal example of a new application developed by me)and finally try to shed
a light on what is it that has made them undefeated in this cut throat competition.

2.0 About the Company:

TATA Consultancy Services Limited (TCS) is an Indian multinational information
technology (IT) service and consulting company with headquartered in Mumbai,
Maharashtra, India. TCS has its own R&D called Innovation Labs. Once you become an
employee you can approach Innovation Labs (If it's there at your base branch) and talk to
them about your passions, if they're interested, you'll have an interview.(tcs.com//about
TCS).TCS innovaton lb has already filed over 3500 patents and has a team over 110 PhD-
qualified experts from different computing domains working on cross-functional research on
complex (and emerging) technologies. (TCS Research and Innovation Journal, TCS
Advantage,2019,pg.2)

2.1 Economic Impact

TCS’ market cap is more than the GDP of about 120 countries(Times of India.2018).The m-
cap of TCS is almost one-fourth of the country’s foreign exchange reserves. According to the
Reserve Bank of India (RBI) weekly statistical supplement the overall forex reserves rose to
$426.08 billion from $424.86 billion reported for the week ended April 5.

2.2 Business Model

TCS has a unique business model which has proved to be successful in creating unique
advantages for the company. TCS focused on geographical penetration in depth and width;
today they have agile HR system which could place resource from any corner of the world to
service its global clients. Also, TCS has very strong local presence in all developed
economies hence unaffected by protectionist measures.

TCS adopted customer intimacy and cost efficiency as key strategies, both turn to be
successful in helping TCS deliver large projects at less cost. Also, TCS purchased/leased key
assets in India i.e. 15-20 kms away from all leading tier I and II cities. (Journal of
international Business Studies, Reinventing the business model TCS,2014,p.36).

Fig1: Business Model TCS

Source: Journal of international Business Studies, Reinventing the business model

TCS,2014,p.36

2.3 Marketing Mix

2.3.1 Product

TCS is mainly a service-based company and provides a wide range of information

technology-related products and services including application development, business
process outsourcing, capacity planning, consulting, enterprise software, hardware sizing,
payment processing, software management and technology education services.

Digitate was founded in 2015 by TCS, Digitate is headquartered in Santa Clara, California,
USA and Pune, India. It leverages artificial intelligence to intelligently manage and automate
your IT infrastructure. ignio™ is a cognitive automation solution that enables smarter and
faster decision making, allowing enterprises to predict problems. it has won four silver
Stevies®(16th international annual business awards,2019)

TCS product development strategy-Ansoff Matrix: During my training with TCS I learned
that while investing on and developing a new product they mainly focus on cost effective
components and the demand of the product in the market. They ensure that the technology
they are providing has low competition and preferably did not exist previously to ensure
ample growth opportunity.

Fig2: TCS Product development strategy: Ansoff Matrix

Source: TCS- Internal Use Training Material: provided to me on February,2019

2.3.2 Price & Pricing Strategy

Tata Consultancy Services has a diverse offering and hence a variable pricing policy.
Through its different pricing models and policies, TCS promises clients - process
improvement, cost reduction, revenue enhancement and timely deliverables. TCS follows
success-based pricing model in some of its total outsourcing contracts.(TCS marketing mix
,mbaskool,April 19,2020).

2.3.3 Place & Distribution Strategy

Not only India but TCS has conquered global market as well through its diversified employee
base, updated technology and business models. TCS operates and has offices in the following
regions – India, North America, LATAM, Middle East and Africa, Europe and UK, Australia
and New Zealand. It employs people from 120+ nationalities in 55 countries and provides the
right mix of talent retention and better growth opportunities.

TCS has continuously achieved various awards and recognitions in various countries for its
services and success - World’s most powerful brand in IT services by Brand Finance, Dun &
Bradstreet Corporate Award, ‘Company of the year’ award Top employer institute for TCS
UK and Ireland, Make in India awards for excellence in IT Services category, etc. to name
few. .(TCS marketing mix ,mbaskool,April 19,2020).

2.3.4 Promotion and Advertising Strategy

TCS has got a well-defined set of programs for each geography. For example, in India TCS
runs ALP- adult literacy program, BPS employability program, Advanced computer training
center – to promote employability for visually impaired youth, InsighT – for school children,
etc. Internationally it has programs like STEM education and technology inclusion, Pro
Bono, ENABLE and goIT to name few. TCS also volunteers and organizes various
marathons worldwide every year. Also, through its Purpose4life program, TCS encourages its
employees to contribute towards social wellbeing.

2.4 Market Evolution and Adaptation

Tata Consultancy Services launched as a division of Tata Sons on April 1, 1968, as a

management and technology consultancy that would create demand for downstream
computer services. This was well before the time when personalized computters were
launched in India in 1975.During this time TCS worked for MNC’s based in NewYork and
develoved itself in wait for the Indian market to catch up.

In 1981 they set up their Tata Research and Design Development Center(TRDDC) in Pune,
India. Marking the start of their signature focus on computer-aided software engineering. In
1996 they set the record for the fastest implementation of a depository system anywhere in
the word by building the core platform for the National Securities Depository Limited, the
first electronic depository in India, in less than five months.

They have always been one step ahead of their competitors in the market and have had the
foresight or an uncanny knack for what is needed before its even needed. Due to this they
have always been able Market Leaders or Trend setters. In 2015 their Cloud Platforms (iON
assessments, financial inclusion, HR, financial accounting, TAP™, procurement, and
analytics) crossed the $100 Mn revenue mark.

Today they are ranked among the top three most valuable brands in the global IT services
sector, and named the fastest growing IT services brand in an assessment done by Brand
Finance.(TCS 50 Time Machine available at:< https://www.tcs.com/tcs-50>acceseed on
June 13,2020)

2.5 Competitor Analysis

According to the Bombay Stock Exchange Report (BSE, June 14) the top competitors of TCS
in Indian Market are Infosys, HCL Technologies, Wipro, Infotech and Tech Mahindra.
The biggest competitive advantage of TCS is that 95% of its business is from Repeat
customers which goes on to show that they are very customer-centric. TCS is also a part of
Tata group which is a symbol of trust and success business. They also have a global presence
and a Global delivery network model.

Innovation Labs also play a big role in setting it up from its competitors.

Fig 3: BSE standalone report

Source: Business Standard, TCS competitors comparison BSE standalone report,<

https://www.businessstandard.com/company/tcs5400/peercomparisons/competition/9/1/
bse/Standalone> June 14,2:30 pm IST.

3. Agile Work Model

A framework called agile is replacing the older waterfall method of software development.
the older process had a linear system where the development of software happened in stages.
Agile is a more collaborative approach. Work is incremental and the focus is on rapid
delivery.

TCS is at the forefront of this evolution and building an office complex named Olympus.
Where there will be no more cubicles but bright colourful spaces to encourage innovation.
(Mendonca and Sachitanand,2018.Why IT companies are shifting to agile work model, The
Economic Times, June 2.)

There are four ideas that help to employ agile principles in an organization:

1. Organize teams by features: Make sure your teams focus on customer journeys,
mapping, and improving a consumer’s experience at every step.
2. Develop team skills to analyze and improve customer value streams: Team
members need to understand what tasks add value. They must ask which processes are
central to the operations and where handoffs are happening. Cross-functional teams
 should include members from all parts of the business that have an impact on bank
processes.
3. Scale those agile skills: Chances of success will improve if you start small and prove
the value of agile before replicating elsewhere.
4. Build once, use many times: once a hit feature has been found the strategy should be
to find ways of reusing it in other parts of the business.

Fig 4: TCS Agile at Scale Model

Source: TCS investor Relations Presentation, Go Agile at Scale, Sept 2019,p.12

4.TCS Innovation Strategy

According to research done by (Mithas and Arora,2016), Tata Group set up the Tata Group
Innovation Forum (TGIF) to plan and roll out group-level initiatives to help Tata companies
innovate. Major TGIF activities in fostering innovation fall into four broad areas: create
capacity for innovation, measure innovation, facilitate innovation, and recognize and reward
innovation.

1. Creating Capacity for Innovation

TGIF uses three learning mechanisms to build capability for innovations: innovation
workshops, learning missions, and dissemination of innovation-related literature and
case studies.
2. Measuring Innovation
Tata Group uses a questionnaire called InnoMeter to measure the “as-is” state of
innovation. Broadly, it covers three areas: the innovation process, innovation culture,
and the strategic focus on innovation.
 The outcome of the InnoMeter generates creative tension and lets the company
identify areas it must address to make its innovation funnel and processes more
robust. 
3. Facilitating Innovation
Tata InnoVerse is an in-house social networking platform with Facebook-like features
as well as features similar to prediction markets to augment the innovation life cycle
that starts from idea generation.
InnoVerse had more than 54,000 enrolled users who generated more than 46,000
ideas and 470,000 impressions either organically or through more than 640
challenges; the platform helped to select more than 2,340 ideas. More than 40 percent
of these ideas came from employees of other Tata compa-nies. The group is working
toward enhancing this platform to track and develop selected ideas for subsequent
commercialization.(S. Mithas and R. Arora, "Lessons from Tata's Corporate
Innovation Strategy," in IT Professional)
4. Recognizing and Rewarding Innovation
In 2006, Tata Group initiated the process of celebrating innovations in Tata Group
through a program called Tata InnoVista. Tata Inno-Vista currently has four award
categories: Promising Innovations, Dare to Try, The Leading-Edge Proven
Technologies and Design Honor to highlight the importance of design in all products
and services. 

Research is the foundation on which robust innovation is built. TCS relies on research-based
innovation to solve customer challenges and provide impactful solutions. They have a
network of Innovation Labs that are focused on domains and technologies, and which enable
agile proofs of concept that can later be scaled to commercial offerings.

5.Obstacles to Innovation

With the Internet of Things, Big Data analytics, and artificial intelligence many new, tech-
savvy market entrants providing online-only products, utilizing digital services, and offering
individualized customer experience disrupting the traditional insurance business model. The
established insurers are struggling to provide the same level of customer experience as start-
ups. This provides an opportunity to transform from the traditional business model and at the
same time have the advantage of an established brand and customer base.

This opportunity will only increase in the future, as more people look for personalized
policies that reflect their lifestyles, habits and digital technology footprint, supported by real-
time pricing and dynamic risk models. The applicability of a one-size-fits-all approach will
not be compelling any longer in an era where levels of customer engagement are increasingly
important for customer retention and growth.

6.Enhance Innovation Performance

According to my observation Big Data, social media, mobility and cloud computing are the
four critical areas of technology that drive changes in today’s business enterprises, creating a
perfect opportunity for innovation. To employ these the company must identify the minor
shifts that happen so that the executives and business strategists can exert control to drive a
holistic digital strategy.

Its necessary to understand that there are no concrete solutions or standard methodologies to
run programs successfully, since each program is different and will have various scenarios
and challenges. While transformation is the need of the hour, its approach needs to be
decided depending on the case.It is crucial to know what we are aiming for, and whether the
transformation team is well acquainted with the end goals. The strategic vision for the
transformation and business outcomes will have to be clearly articulated to all stakeholders
for the transformation program to be successful. a single approach will not work in all types
of situation.

Conclusion

References:-
 About TCS available at:<https://www.tcs.com/about-us> [Accessed: June 4,2020].
 TCS Research and Innovation Journal, TCS Advantage,2019,pg.2
 A. Katiyar and S. Sankaran ,2014, Reinventing the business model TATA
Consultancy Services, Journal of international Business Studies,p.36.
 Times of India,2018.TCS market-cap more than GDP of these countries, The Times
of India, April 24,p.4a.
 16th annual international business awards,< https://stevieawards.com/iba> August 19
2019
 TCS internal use training material<TCS ION platform trainee access> February,2019
 MBA school team,2020,TCS marketing mix<
https://www.mbaskool.com/marketing-mix/services/16978-tata-consultancy-
services.>,April 19,2020.
 Mendonca and Sachitanand,2018.Why IT companies are shifting to agile work model,
The Economic Times, June 2.
 TCS 50 Time Machine available at:< https://www.tcs.com/tcs-50>[Acceseed:June
13,2020]
 TCS investor Relations Presentation, Go Agile at Scale, Sept 2019,p.12
 Business Standard, TCS competitors comparison BSE standalone report,<
https://www.businessstandard.com/company/tcs5400/peercomparisons/competitio
n/9/1/bse/Standalone> June 14,2:30 pm IST.
 S. Mithas and R. Arora, "Lessons from Tata's Corporate Innovation Strategy," in IT
Professional, vol. 17, no. 2, pp. 2-6, Mar.-Apr. 2015, doi: 10.1109/MITP.2015.26.