CENTRAL PROBLEM:

1. To maintain low-cost advantage they have opened offices in Czech Republic,

Mauritius, Poland, Philippines, Thailand and Mexico.
2. Invested in developing training centers -
3. Improved quality capabilities - CMM level 5i company.
4. Infosys Consultancy established to provide high end services in value chain.
5. Has hedged currency for more predictability of revenues (risk management).
6. The economic environment, pricing pressure and rising wages 3 I3/, ,3/
overse,s.

7. Intense competition 3 the m,rket for tech3ology servces coul/ ,ffect cost
,/v,3t,ges.

8. Curre3cy fluctu,to3s
9. Glob,l Slow/ow3 of eco3omy
10. L,te e3try 3to 3/,.
11. Not use/ to very hgh ,ttrto3 r,tes.
12. New to Low cost servces mo/el.
13. New work3g e3vro3me3t.
14. Less 3umber of hghly t,le3te/ workforce (As comp,re/ to glob,l employees).

THREATS:

1. The economic environment, pricing pressure and rising wages in India and
overseas

2. Intense competition in the market for technology services could affect cost
advantages.

3. High dependency on a small number of clients, and the loss of any one of
the major clients could significantly impact business.

4. Failure to complete fixed-price, fixed-time frame contracts within budget
and on time

5. Currency fluctuations

6. Termination of Client contracts can typically be terminated without cause
and with little or no notice or penalty.
. India is not the only country that is undergoing rapid industrial expansion. Competitors may
come Irom countries such as China or Korea where there are large pools oI low-cost labor, and
developing educational inIrastructures such as universities and technology colleges.

8. Customers may switch to other oIIshore service companies in other countries such as China or
Korea.

9.Other global players have realised that India has the beneIit oI low-cost, highly-skilled labor
that oIten speaks English and is culturally sensitive to Western practices. As with all global IT
players, InIosys has to compete Ior skilled labor and this may have the eIIect oI driving up wage
levels, and making it more diIIicult to recruit and retain staII.

WEAKNESSES:

1. Excessve /epe3/e3ce o3 US for reve3ues - 67 % of reve3ues from USA
2. Excessve /epe3/e3ce o3 BFSI sector for reve3ues - 36 % of reve3ues from BFSI
3. We,k pl,yer 3 /omestc m,rket. O3ly 1 % of reve3ues from I3/, - low ,s
comp,re/ to peers
4. Low R & D spe3/3g ,s comp,re/ to glob,l IT comp,3es - o3ly 1.3 % of tot,l
reve3ues
5. Rs3g w,ge bll - 42.9 % to 44.8 % of reve3ues
6. Low expertse 3 hgh e3/ servces lke Co3sult,3cy ,3/ KPO.


RECOMMENDATIONS:
1. MARKET PENETRATION STRATEGY:
As most large clients in US and Europe are cutting costs, InIosys needs to be more aggressive on
cost and quality Iront.
Result of strategy. Unlikely to yield good results
2. MARKET DEVELOPMENT STRATEGY:
Since these are Iast developing IT market, InIosys needs a paradigm shiIt in Iocus Irom US and
EU markets to these markets.
Result of strategy. Likely to yield good result.
3. PRODUCT DEVELOPMENT STRATEGY:
Concentrate on building expertise in these domains by strategic acquisitions.
Result of Strategy. Likely to have good result. (better the company acquired, the better the
result).
4. DIVERSIFICATION:
Changing Brand image Irom low value service provider to high value service provider.
Result of Strategy. DiIIicult to achieve overnight (possible in long term)
5. Companies must provide diverse services to reIrain Irom being over-dependent and
increasing exposure to the vulnerabilities oI Iew sectors/companies/geographies.
6. Provide more high-end services in value chain (3rd WAVE in IT)
There is a move required Irom ADM (Application Development and maintenance), BPO
to Consulting and Package Implementation, etc.
7. ShiIt in Iocus Irom Low cost advantage to high quality services
8. Consolidation and strategic acquisitions are essential Ior Iuture growth oI revenues.
9. Quickly adapt to high growth markets is necessary: In FY2008, Indian domestic market
grew by 20, but InIosys revenue Irom India declined to 1, unlike other IT companies.