Big brains, little profits

May 03, 2005

Two weeks after IBM announced an earnings shortfall due largely to weak sales in its consulting services division, Indian outourcing giant Wipro has launched a consulting unit. Wipro's advantage? A big pool of smart young graduates who are happy to work for much lower wages than their Western counterparts. "Services companies are not very glamorous in the U.S.," Wipro executive Ramesh Emani drily tells CNET. "We are not apologetic about being a services company." With Dell also pushing into services with an explicit commoditization strategy, it doesn't take a genius to see where this market's headed.

Posted by nick at May 3, 2005 10:34 PM

Advertisement: Are you ready for "The Big Switch"? Nicholas Carr's new book "is the best read so far about the significance of the shift to cloud computing," says the Financial Times. Fast Company calls it "compulsively readable." Order now from Amazon.com.

Comments

Dear Mr. Carr,

It just gets me thinking: does the implied offshoring of consulting (assuming Wipro would drive it's consulting farm from India) to low-cost locations like India itself is an additional sign of the commoditization of services, just like the offshoring of low-skill/non-strategic software development to such cost competitive locations can be interpreted as the commoditization of IT?

thanks and regards,
- Bhushan Y. Nigale.

Posted by: Bhushan Y Nigale at May 19, 2005 06:01 AM

Subscribe to Rough Type