IBM INDIA

LIMITED

Background
IBM India Limited, a subsidiary of International Business Machines Corporation Inc. (IBM), was set
up in September 1999. IBM entered the Indian market with a joint venture with the Tata Group
in 1992. IBM is the only company in the world that offers end-to-end solutions to customers
from hardware to software, services and consulting. Since its inception in India, IBM has expanded
its operations considerably and currently operates through a network of 14 offices, with regional
headquarters at Bangalore, New Delhi, Mumbai, Kolkata and Chennai.
The Company has interests in sales and marketing of servers, PCs and software products and
services. IBM’s businesses in India include the IBM Software Group, IBM Global Services, IBM
Consulting Services, IBM Global Financing, IBM Solution Partnership Centre (one among 10
worldwide), Linux Solution Centre (one among 7 worldwide), Software Development Centres,
Global E-Business Centre and a manufacturing facility at Pondicherry.
IBM recorded total revenue of US$ 606 million in FY 04 and is profitable in India. It has
a workforce of 23,300 including those at its BPO centre, and 34 per cent of the total
revenues come from exports. According to internal sources, IBM has invested approximately
US$ 10 million in India so far, mostly in year 2000 for labs, and this does not include the
Daksh investment.

Leader in notebook and
server segments
Market share
IBM India recorded 31.3 per cent market share in the
notebooks segment (revenues) to gain the leadership
position in FY 04. IBM is a market leader in the servers
segment with a 32 per cent market share. In the
lower-end server segment, IBM emerged the leader
with a market share of 38.2 per cent.
Achievements in India
IBM India was chosen as one of the Top 3 Employers
in Indian IT’s Best Employers Survey conducted by
Dataquest - IDC India. The same survey ranked IBM
subsidiary, Daksh eServices as the Best Employer in
the BPO Sector. IBM was also ranked second in a list
of Dream Companies, that respondents aspired to
work in. IBM also appeared in the top 3 preferred IT
employers in the country in 2003-04, in an IT employer
brand perception study by Brand-comm.
IBM Global Services India was awarded the prestigious
Gold certification by Cisco Systems, for the relentless
pursuit of customer satisfaction, training, support and
specialisation requirements set by Cisco.
IGSI was recognised as the “Top MNC Software
Services Exporter” in Karnataka for 2003-04 by
Software Technology Parks of India (STPI), Bangalore

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In April 2004, IBM was awarded the Golden Rhino
Award in the Server and laptop category. The Golden
Rhino Award is the channel’s seal of approval for
the Most Reliable Product in the market.
IBM stands No.1 in the Portables (Notebook) category
in the Customer Satisfaction Audit 2004. The survey
was conducted by Dataquest and IDC India among
4000 Enterprise CIOs.
IBM ThinkPad has been chosen Laptop of the Year
4 times over the last 5 years.
PC Quest Users Choice Award was picked up by
IBM for its High End Servers.
IBM has also been adjudged Implementation Partner
of the Year.
Factors for success
Wide range of offerings
IBM has set the agenda for the industry with ‘on
demand business’ – a kind of transformation where
an organisation changes the way it operates and
reduces costs; serving customers better, reducing risks
SUCCESS STORIES
and improving speed and agility in the marketplace.
IBM is already working with customers to transform
them into ‘on demand’ businesses. IBM is the only
company in the world that offers end-to-end solutions
to the customers from hardware to software, services
and consulting. Linux support further enhances IBM’s
e-business infrastructure enabler capability.
IBM Global Services is the world’s largest
information technology services and consulting
provider, generating record revenues and signings
in 2003 of US$ 42.6 billion and US$ 55.5 billion,
respectively. Some 180,000 professionals in more than
160 countries, including India, help clients integrate
information technology with business value - from the
business transformation and industry expertise of IBM
Business Consulting Services to hosting, infrastructure,
technology design and training services. Leveraging
IBM’s unequalled scope and scale, IBM Global Services
delivers integrated, flexible and resilient processes -
across companies and through business partners - that
enable clients to benefit from the ‘on demand’ business
model by saving money and making their businesses
more competitive.
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IBM’s offerings of hardware and expertise in planning,
deploying and maintaining infrastructure of any scale,
enable the company to gain a lead in the domestic
outsourcing market. With a manufacturing facility at
Pondicherry for commercial desktops, low and mid-
range servers, IBM is in a position to offer customised
products to local customers.
Marketing strategy
Efficient implementation of channel strategy is one of
the key factors driving IBM’s success. IBM’s sales grew
considerably as a result of the channel infrastructure,
programmes and opportunities provided by the
Company to its partner organisations.
Reduced price for the Indian market
Realising that India was a highly untapped and fast-
growing market, IBM set up operations in all the
sectors of its business in the country. IBM reduced its
notebook prices, bringing them closer to the desktop
models to increase its market share since the laptop
to desktop ratio in India is 1:3 against 1:2 in developed
countries.
Strong parental support
IBM Corporation provides continuous support to IBM
India in terms of global human resources and
technology. IBM regularly exchanges its talent pool
across countries, and recently shuffled the top
management across countries.
Increasing the market potential
IBM has initiated plans to increase the market potential
by increasing the awareness on IT among the masses.
FORTUNE 500 COMPANIES IN INDIA
IBM has entered the academic sector by providing IT
education, thereby expanding the user market. The
company has pioneered partner relationships with
a number of educational institutions including the IITs
at Delhi, Kanpur and Chennai and a number of
renowned IT schools in the country.
Leveraging the India Advantage
India as a global sourcing base
for BPO operations
IBM expanded the scale of its BPO operations in India
with the acquisition of Daksh, the third largest BPO
outfit in India with over 6,000 employees. This enabled
IBM to have an international presence in BPO
operations with big-ticket customers and scale up its
telecom, insurance and Internet customers.
India as an R&D hub
India Research Laboratory, Delhi: (one among 8
facilities worldwide): IBM’s India Research Laboratory
(IRL) focuses on areas critical to expanding the
country’s technology infrastructure. It also has significant
initiatives in Services and Sciences, Information
Management, User Interaction Technologies, e-
Commerce, Life Sciences, Distributed Computing and
Software Engineering. Currently, IRL researchers are
working on several projects covering bioinformatics,
text mining, speech recognition for Indian languages,
natural language processing, grid computing, and
autonomic computing, among others.
India Software Labs at Bangalore and Pune: The
Software Labs in India develop, enhance and support
key IBM software products & technologies in
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collaboration with other IBM labs worldwide.
Center for Advanced Studies (CAS) at Bangalore
was established at the India Software Labs to allow
universities, access to IBM’s leading-edge product
development and the supporting infrastructure; while
giving IBM the opportunity to work with academic
leaders and researchers on research projects.
IBM Innovation Center for Business Partners: (one
among 10 facilities worldwide) Independent Software
Vendors are encouraged to port their solutions on
India as a software development hub
IBM also has Global delivery centres in Bangalore,
Pune, Gurgaon and Kolkata. They deliver “best-of-
breed’ technology solutions to IBM customers
worldwide covering middleware, e-business
technologies, enterprise and Web technologies, data
warehousing across functional areas like Supply Chain
Operation Services, Financial Management Services,
Human Resource Services, Customer Relationship
Management, e-Business Integration and Application
Management Services.

IBM platforms at this Center and develop Web based

applications for Indian customers.
Future plans
With good success in the country, IBM plans to make
Linux Solution Center, Bangalore: (one among 7
the Indian subsidiary a hub for global operations and
facilities worldwide) The Center supports Business
for its Linux initiatives in the South East Asian region.
Partners and Independent Service vendors across the
ASEAN/South Asia region.

IBM Linux Competency Center, Bangalore: (one

among only 4 facilities in Asia) This Center develops
standards and embedded software for open source,
undertaking high-end research in the area for IBM
Worldwide.

Global e-business Software Center, Gurgaon: This

state-of-the-art center combines IBM’s global
experience and technology expertise to deliver
e-business solutions for Indian organisations and the
government through the e-Governance Centre.

Engineering & Technology Services Center, Bangalore:

This Center provides technology design services for
advanced chips, cards and systems to companies in
India and across Asia.

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