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IT Companies Like IBM Moving to India: the Main Reasons
Introduction
It is interesting, but India only strengthens its position in the global market, namely in delivering the offshore services. The point is that the most famous computing companies are moving their centers to India, leaving in the US fewer employees. It was estimated that more than 130000 people in India comprise the total workforce of IBM – International Business Machine Corporation. In such a way, the country proves to be successful in the modern high-tech globalization and manages to provide the whole world with the computing needs.
Background of IBM Moving Decision
The first point to make is to state that in the past decade the US computing centers such as IBM were considered to be the most powerful in this business, but nowadays India seems to be more promising in the new inventions and professional staff. To be more precise, it succeeded in delivering the services and at the same time, it offers the new, cutting-edge investigations, mainly the artificial intelligence, the visual search and computer vision for self-driving cars. In general, the reason for moving the centers to India is the aim of reducing the company’s revenue and shifting the main business to providing the tech services for the corporations and even governments(Chary). IBM centered its primary goals in India for in such a way to take away the possibility of other low-cost companies like Wipro and Infosys to rule the global market of this business. It is interesting but such tendency of moving the jobs overseas is not the recent one, because the US companies, for instance Oracle, have always been offering the jobs to the overseas workers.
There is a great difference between other companies and IBM since the last employs more people from India, the foreign country, than gives the job to its national employees. The company views India as the ideal opportunity to spread the development of its services throughout the world but at the same time to keep down the company’s costs. In particular, the salaries of Indian workers are not similar to those workers in US center. It was said that they are from one-half to one-five of the salaries paid to Americans, what in fact makes India more profitable for the company’s intentions and future plans. Notably, the high level of proficiency and skills, the qualified workers as well as the lower expenses make it possible to improve the revenue (Goel).
Still, such practice of giving the jobs to Indians was not freely accepted by the President Donald Trump. He accused the company’s representatives of leaving Americans with no job opportunities. Still, IBM does not agree with such accusation and after the elections, the chief representatives even create 25000 jobs for Americans as well as the professional training for the potential employees without four-years of college. On the whole, India is the hub of the perspectives that offer both the spread of new technologies and the inventions that in the future will be the breakthrough. In other words, Indian workers execute the monitoring of the computer systems of different universal banks, governments and phone companies, manage the consulting services and write software (Khanna).
The Factors of Indian IT Companies
Another great example of such Indian success is the company Cargill that is the business center in Bengaluru. The company provides the services in the spheres of IT, sourcing, logistics and human resources. The company in India employs 1800 workers of all 4000 in other Cargill centers. More than half of the global finance is being processed in India what may turn it into the global leader. To be more specific, especially in this country the newest areas and technologies develop, namely the data analysis, artificial intelligence and digital one. At the same time, the worldwide known Cargill apps are also created in India. All in all, India still, works on the development of its national market what very soon will swallow the universal one. It can be explained by the Indian great desire to experiment, to try new approaches, to innovate and be ready to implement. What is more, here the cost of failure is lower than for instance in America.
In addition, Indian is viewed as the great perspective for capturing the global GIC since at the time China now dominates the fields of hardware and manufacturing of the whole world, GIC is the best in the digital transformation of the software (Chary). As well as the connection with the GIC, India is considered to be the huge house of the young and professional engineers and the companies even collaborate with the universities to sustain such great tendency of qualified graduates.
Furthermore, Indian computing companies are not scared of other countries’ success because, for instance, China is weaker in such aspects as the level of English proficiency, has less connection with the MNC (Multinational Company) and fails the cultural adaptability.
Still, what must be said is that there are other factors which in reality contribute to the GIC wave in India. Firstly, such MNCs as LinkedIn and Uber view India’s domestic market as the great option. Namely, in a variety of spheres, India is a leading country what makes it a desirable place for innovations and practice. Another thing is that the country is not open to technologies, it experiences the price sensitivity and possesses the young professional workers what allows others to turn it into the place for experiments, for testing of the new products and services.
Conclusion
Still, GIC may affect Indian computing business what will turn it into the most powerful throughout the world (Goel). Specifically, instead of focusing on the cost-arbitrage that rules the IT services, the country would center on the innovation-ruled industry. The change must be in the perception of startups which are necessary for the quicker development and the creation of global connections. The education will start from colleges where the companies will teach the students the newly appeared spheres like loT to make them acquainted and ready to work.
To sum up, India looks rather promising in the sphere of computing services because all the conditions and working opportunities allow it to swallow the global market. The main reason is of course the range of specialists and qualified workers who make the country a desirable partner. Another main factor for moving the companies to India is the lower costs in all the aspects. Namely, the salaries are lower than in American workers and the expenses for the implementation and the costs of failure are not so warning.
That is why, the companies choose India as the hub of skills with the low prices. Nowadays India remains one of the most powerful business centres but it still needs the improvement in the business account and sustained cost excellence, the approaches to work and data and analysis.
Works Cited
Chary, Manish. India: Nation On The Move. Bloomington, Iuniverse, 2009.
Goel, Vindu. “IBM Now Has More Employees In India Than In The U.S..” Nytimes.com, 2017, https://www.nytimes.com/2017/09/28/technology/ibm-india.html.
“Emerging Giants: Building World-Class Companies In Developing Countries.” Harvard Business Review, 2017, https://hbr.org/2006/10/emerging-giants-building-world-class-companies-in-developing-countries.
“IBM Shifts Center Of Gravity Half A World Away, To India.” The Seattle Times, 2017, https://www.seattletimes.com/business/ibm-shifts-center-of-gravity-half-a-world-away-to-india/.
“Forbes Welcome.” Forbes.com, 2017, https://www.forbes.com/sites/panosmourdoukoutas/2017/10/06/ibm-should-cut-down-on-outsourcing-to-india/#5a3160a74116.
