September 2016

Promises to reap

Tata Consultancy Services has grown steadily since setting up in Indonesia in 2006, and it is well placed to benefit from the potential of a country on the move

The Tata Consultancy Services (TCS) template for success in the information technology business, honed down the years through exceptional expertise and abundant experience, is dependent to a large extent on reach and on being rooted in any chosen geography. The TCS operation in Indonesia illustrates the organisational spread of the company, as also the firm foundation on which it expects to grow in a market with loads of potential.

Executives from Tata Consultancy Services and Garuda Indonesia at the launch of the IT implementation project at the airline

Indonesia is a high-priority target for TCS in a region that is growing faster than most. “We got started in the country back in April 2006 with banking and financial services and we have enhanced our portfolio over time,” says Bhavin Zaveri, the TCS country head in Indonesia. “This is not a fully mature market as yet from the IT perspective, but it is poised to take wing.”

TCS was the first Tata enterprise to be established in Indonesia and the archipelago’s growing importance to the group is exemplified by the company’s progress in the decade since it was set up. “We have grown reasonably well here but what’s more significant is the scope for further expansion,” adds Mr Zaveri, a 13-year veteran with TCS who joined the company as a graduate trainee on completing his engineering from the Manipal Institute of Technology.

Banking delivered the initial thrust for TCS in Indonesia and it remains a staple for the company. TCS provides software and services to four of the top six banks of the country. These banks have taken the best in the TCS portfolio, including TCS BaNCS, a proprietary core banking solution.

Readymade products, rather than customised solutions, tend to dominate the Indonesian IT market. This may seem to be inimical to TCS, which has IT services, consulting and business process outsourcing as its three pillars, but the situation is changing. “The future here, as elsewhere, is about digital and we have plenty of traction there,” explains Mr Zaveri, who took on the country head role in 2015.

Besides banking and financial services, TCS now has Indonesian customers from a variety of other industries, among them telecommunications, retail, airlines, insurance and energy. Most of these companies, even those sitting on the fence, are convinced that digital is the way forward, and that is music to TCS’s ears.

Any country with a large population is fertile ground for the skills that TCS possesses. Indonesia, with more than 250 million people, certainly fits the bill. The go-to strategy for the company, in the circumstances, is to concentrate on industry segments where the people numbers truly count.

As a country and as a market, there is an allure about Indonesia that outsiders find impossible to resist. Mr Zaveri does not even try to. “I believe Indonesia is a fantastic place to be in, a land full of opportunities. The best of this country is its people: very nice, very warm. They may appear to be laidback, but they have this urge to learn and to move forward. In the business sense, too, Indonesia has much to offer; it’s the giant of Southeast Asia.”

TCS has tweaked its operational model in Indonesia as it has gone along. The company has its famous offshore model for a lot of the IT work it does in countries such as the United States and Britain, with the bulk of the tasks being handled out of India. It also has what are known as ‘near shore’ centres in places like the Philippines, Hungary and Mexico. What TCS has in Indonesia is ‘blended ops’.

The talent pool that TCS can dip into is not, obviously, as big as in India. “That is a challenge and we tried to meet it by hiring from the best of institutions and moulding new entrants in the TCS way of working,” says Mr Zaveri. “Barring a couple of people, those taken on have stayed with us.”

Close to 40 percent of the TCS workforce that caters to Indonesian clients are locals, and that’s a number bound to rise. In terms of the business figures, 2015-16 was a bit sluggish for the company but Mr Zaveri expects growth of 25-30 percent this year. “Commensurate with our growth, we will add more local staff.”

In the TCS outlook, its Indonesia business cannot but grow in an economy that has momentum on its side. The country is currently midway in the TCS portfolio in revenues from the region, but it has many miles to cover to get to the top. “We see ourselves growing at least 200 percent in the next three-four years,” says Mr Zaveri.

There are difficulties to be overcome for TCS to make good on its projections. “The IT industry in Indonesia will take a while to reach the level it is at in the western world or even in Singapore,” adds Mr Zaveri. “That aside, competition is plentiful here, with multinationals and locals in the fray, and cost is always a crucial factor.”

Mr Zaveri, a connoisseur of foreign cultures, is effusive in his admiration of all things Indonesian, save for the forever gridlocked traffic in Jakarta, where TCS has its headquarters. “People coming from India have their concerns, but they love the country once they get accustomed to its rhythms. You have all the amenities and there is so much choice in food, even for a vegetarian like me.”

These are still fledgling days for TCS in Indonesia and there are hurdles to be crossed, but Mr Zaveri is not inclined to dwell on the constraints. “As a proud TCSer and Tata person, I believe we can a do a huge amount for ourselves and for the country, especially with our philosophy of giving back to society. Indonesia can, further on down the road, overtake the Singapores of the world and I expect TCS and the Tatas to help in making that possible.”

Two in the brew
Tata Consultancy Services (TCS) has cemented its credentials in Indonesia by doing what it does best: delivering services, solutions and products that enable its clients to maximise efficiencies and draw the most out of information technology. Here are two examples of how:

Garuda Indonesia: In March 2014, TCS provided a solution to Garuda Indonesia, the country’s national airline, to enable it to enhance aircraft maintenance, repair and overhaul (MRO) operations.

Garuda’s relationship with TCS began in 2012, when the airliner wanted to upgrade, consolidate and enhance its MRO technology infrastructure, which was spread across numerous applications from multiple vendors. The programme to implement the TCS SWIFT MRO platform moved from the blueprint phase to go-live in 13 months, much faster than a project of the kind takes.

Allianz Indonesia: TCS helped PT Asuransi Allianz Life Indonesia — part of the Allianz Group, among the largest insurance companies in the world — establish rigourous test processes and build the platform for a comprehensive in-house test centre.

Allianz Indonesia provides insurance solutions to more than 2 million policyholders. It needed to demonstrate agility and responsiveness in delivering defect-free products, and it needed to build a test management centre to develop in-house capabilities and design a sustainable governance process.

TCS worked closely with the Allianz Indonesia team since the beginning of the engagement in 2012 to drive the project’s primary goal of setting up the test centre.