TATA CONSULTANCY SERVICES

History

1968–2003

Tata Consultancy Services Limited, initially started as ” Computer Systems” was founded in 1968 by division of Tata Sons Limited.[20] Its early contracts included punched card services to sister company TISCO (now Tata Steel), working on an Inter-Branch Reconciliation System for the Central Bank of India,[21] and providing bureau services to Unit Trust of India.

In 1975, TCS delivered an electronic depository and trading system called SECOM for the Swiss company SIS SegaInterSettle [de]; it also developed System X for the Canadian Depository System and automated the Johannesburg Stock Exchange.[22] TCS associated with a Swiss partner, TKS Teknosoft, which it later acquired.[23]

In 1980, TCS established India’s first dedicated software research and development centre, the Tata Research Development and Design Centre (TRDDC) in Pune.[24] In 1981, it established India’s first client-dedicated offshore development centre, set up for clients Tandem. TCS later (1993) partnered with Canada-based software factory Integrity Software Corp, which TCS later acquired.

In anticipation of the Y2K bug and the launch of a unified European currency (Euro), Tata Consultancy Services created the factory model for Y2K conversion and developed software tools which automated the conversion process and enabled third-party developer and client implementation.[25] Towards the end of 1999, TCS decided to offer Decision Support System (DSS) in the domestic market under its Corporate Vice President and Transformation Head Subbu Iyer.[26]

2004 to present

On 25 August 2004, TCS became a Publicly Listed Company.[27][28]

In 2005, TCS became the first India-based IT services company to enter the bioinformatics market.[29] In 2006, it designed an ERP system for the Indian Railway Catering and Tourism Corporation.[30] By 2008, its e-business activities were generating over US$500 million in annual revenues.[31][32]

TCS entered the small and medium enterprises market for the first time in 2011, with cloud-based offerings.[33] On the last trading day of 2011, it overtook RIL to achieve the highest market capitalisation of any India-based company.[34] In the 2011/12 fiscal year, TCS achieved annual revenues of over US$10 billion for the first time.[35]

In May 2013, TCS was awarded a six-year contract worth over ₹1100 crore to provide services to the Indian Department of Posts.[36] In 2013, the firm moved from the 13th position to 10th position in the League of top 10 global IT services companies[37] and in July 2014, it became the first Indian company with over ₹5 lakh crore market capitalization.[38][39]

In Jan 2015, TCS ends RIL‘s 23-year run as most profitable firm[40]

In Jan 2017, the company announced a partnership with Aurus, Inc., a payments technology company, to deliver payment solutions for retailers using TCS OmniStore, a first of its kind unified store commerce platform.[41] In the same year, TCS China was associated as a joint venture with the Chinese government.[42]

TCS announced its FY19 Q3 results posting 24 percent year-on-year (YoY) rise in profit at ₹8,105 crore.[43] The stock plunged 2.5 percent intra-day as brokerages cut price target.[44]

TCS Honoured with Four Stevies® at the 2019 American Business Awards®[45]

Acquisitions

Name Acquisition date Activities Country of HQ Price Employees
(at acquisition)
Description Sources
CMC Limited 2001 October IT Services  IND $33.9 m 3,102 Gets Embedded Expertise & good Domestic customer reach. CMC Amalgamated with TCS on 28 April 2015.[1] [46][47][48]
Airline Financial Support Services India (AFSI) 2004 January BPO  IND $5.1 m 400 BPO expertise in Airline and Hospitality sector [49][50]
Aviation Software Development Consultancy India (ASDC) 2004 March IT Services  IND $3.1 m 180
Phoenix Global Solutions 2004 May Business Process Outsourcing  IND $130 m 400 Acquire expertise in insurance-domain consulting [51][52]
Swedish Indian IT Resources AB (SITAR) 2005 May IT Services  SWE $4.8 m n/a Acquire blue-chip European customers like Ericsson, IKEA, Vattenfall and Hutchison; SITAR was TCS’ exclusive partner in Sweden and a non-exclusive partner in Norway. [53][54]
Pearl Group 2005 October Insurance  UK $94.7 m 950 Acquired life and pension outsourcing business from Pearl Group; Domain knowledge of life and pension underwriting business. [55][56]
Financial Network Services (FNS) 2005 October Core Banking Product  AUS $26 m 190 TCS acquired core banking solution product (BANCS) and access to 116 customers in 35 countries; FNS was an existing partner for TCS. [57][58]
Comicrom 2005 November Banking BPO  CHL $23 m 1,257 Entry into Latin America; Access to payment processing platform. [59][60]
Tata Infotech 2006 February IT Services  IND $259.2 m 3,600 The merger of Tata Infotech added 15 new Fortune 500 clients. [61][62][63]
TCS Management 2006 November IT Services  AUS $13 m 35 Access to Australian clients [64][65]
TKS-Teknosoft 2006 November Banking Product   CH $80.4 m 115 Expand product portfolio by acquiring rights to Quartz and ownership of Alpha and e-portfolio, enhanced presence in Switzerland and France [66]
Citigroup Global Services Limited 2008 December Captive BPO of Citigroup Inc.  IND $512 m 12,472 TCS acquired key Banking and Financial Services (BFS) domain knowledge. [67][68]
Supervalu Services India 2010 September Captive IT/BPO unit of Supervalu Inc. in India  IND $100 m 600 TCS had a deal with Supervalu to have their Software Outsourcing to TCS and acquired Supervalu India. [69]
Computational Research Laboratories 2012 August High Performance Computing  IND $34 m 80 Acquire expertise in High Performance Computing (HPC) applications and Cloud services [70][71]
Alti SA 2013 April IT Services  FRA $97.5 Mn 1200 Access to blue-chip French and European clients in banking, luxury, manufacturing and utilities sectors [72]
BridgePoint Group 2018 November Management consulting  USA Acquire expertise in US Retirement services [73][74][75]

Products and services[edit]

TCS and its 67 subsidiaries[76] provides a wide range of information technology-related products and services including application development, business process outsourcing, capacity planning, consulting, enterprise software, hardware sizing, payment processing, software management and technology education services.[77] The firm’s established software products are TCS BaNCS and TCS MasterCraft.[78]

Service lines[edit]

TCS’ services are currently organised into the following service lines (percentage of total TCS revenues in the 2012-13 financial year generated by each respective service line is shown in parentheses):

Operations

Tata Consultancy Services has 285 offices across 46 countries and 147 delivery centres in 21 countries.[5] At the same date TCS had a total of 58 subsidiary companies.[77]

Locations

TCS has operations in the following locations:

IndiaAhmedabadBengaluruBarodaChennaiCoimbatoreDelhiGandhinagarGoaGurugramGuwahatiHyderabadBhopalIndoreJamshedpurKochiKolkataLucknowMumbaiNagpurNoidaNashikPatna,[82][83] PuneTrivandrum, and Varanasi

Asia (excluding India)BahrainChinaIsraelUAEHong KongIndonesiaJapanMalaysiaPhilippinesSaudi ArabiaSingaporeSouth KoreaTaiwanThailand, and Qatar [84][85][86]

OceaniaAustralia

AfricaSouth AfricaMorocco (closed)[87][88]

EuropeBelgiumDenmarkFinlandFranceGermanyHungaryIcelandRepublic of IrelandItalyLuxembourgNetherlandsNorwayPortugalSpainSwedenSwitzerland, and United Kingdom.

North AmericaCanadaMexico, and United States.

South AmericaArgentinaBrazilChileColombiaEcuadorPeru, and Uruguay.[89]

TCS BPS

TCS BPS (Business Process Services) is the third-largest India-based IT outsourcing company (after Capgemini).[90] The BPS division had revenues of US$1.44 billion in the FY 2012-13 which was 12.5% of the total revenue of TCS.[91] TCS BPS has more than 45,000 employees which serve over 225 million customers across 11 countries.[92] The rate of attrition in BPS division during the financial year 2012-13 was 19.5%.[93]

In 2006, TCS won a $35 million contract from Eli Lilly and Company for providing data managementbiostatistics and medical writing services.[94][95] In 2007, it won a major multi-year deal from Swiss pharmaceutical major Hoffmann-La Roche to provide data management, biostatistics, clinical programming and drug safety support to Hoffmann-La Roche‘s global pharmaceutical development efforts.[96][97][98]

The firm has also opened a business process outsourcing facility in the Philippines.[99]

Research Development and Design Centre

TCS established the first software research centre in India, the Tata Research Development and Design Centre, in PuneIndia in 1981. TRDDC undertakes research in Software engineeringProcess engineering and systems research. Researchers at TRDDC also developed MasterCraft (now a suite of digitization and optimization tools),[100] a Model Driven Development software that can automatically create code based on a model of a software, and rewrite the code based on the user’s needs.[101] Research at TRDDC has also resulted in the development of Sujal, a low-cost water purifier that can be manufactured using locally available resources. TCS deployed thousands of these filters in the Indian Ocean tsunami disaster of 2004 as part of its relief activities.[102] This product has been marketed in India as Tata swach, a low cost water purifier.[103]

Innovation Labs[edit]

In 2007, TCS launched its co-innovation network, a network of innovation labs, start up alliances, university research departments, and venture capitalists.[104][105] In addition, TCS has 19 innovation labs based in three countries.[106] TCS’ partners include CollabnetCassatt, academic institutions such as IITsStanfordMITCarnegie Mellon and venture capitalists like Sequoia and Kleiner Perkins.[107]

Employees[edit]

TCS is one of the largest private sector employers in India,[108] and the fourth-largest employer among listed Indian companies (after Indian RailwaysIndian Army and India Post).[109] TCS had a total of 4,46,675 employees as of 31 December 2019, of which 36.2% were women.[77][110][111][112] The number of non-Indian nationals was 21,282 as on 31 March 2013 (7.7%).[77][113] The employee costs for the FY 2012-13 were US$4.38 billion, which was approx. 38% of the total revenue of the company for that period.[114] In the fiscal year 2012–13, TCS recruited a total of 69,728 new staff, of whom 59,276 were based in India and 10,452 were based in the rest of the world.[77] In the same period, the rate of attrition was 10.6%.[77] The average age of a TCS employee is 28 years.[77] The employee utilisation rate, excluding trainees, for the FY 2012-13 was 82%.[77] TCS was the fifth-largest United States visa recipient in 2008 (after InfosysCTSWipro and Mahindra Satyam).[115][116][117] In 2012, the Tata Group companies, including TCS, were the second largest recipient of H-1B visas.[118][119] As of Jan 2020, TCS has over 4,00,000+ employees. It is world’s third largest IT employer behind IBM and HP.

Subramaniam Ramadorai, former CEO of TCS, has written an autobiographical book about his experiences in the company called The TCS Story…and Beyond.[120]

Sponsorships

TCS is the title sponsor for Amsterdam MarathonMumbai Marathon and New York City Marathon[121] and one of the sponsors of City2Surf, Australian Running Festival, Berlin MarathonChicago Marathon, and Boston Marathon.[122] In India, it is the title sponsor of World 10K held in Bangalore every year.[123] TCS is a sponsor of Indian Premier League team Rajasthan Royals since 2009.[124] In addition, TCS provides Rajasthan Royals with technology to help in analysis of player performance, simulation and use of RFID tags for tracking the players’ fitness levels and for security purposes in the stadiums.[125][126] TCS sponsors an annual IT quiz for high school students called TCS IT Wiz.[127] The TCS IT Wiz is the largest quiz in India, attracting students who are studying between class 8 and class 12. This quiz is hosted by Giri Balasubramanium.

Controversies

Class action lawsuit

On 14 February 2006, U.S. law firm Lieff Cabraser Heimann & Bernstein, LLP filed a nationwide class-action lawsuit against Tata.[128] In July 2013, judge Claudia Wilken of the U.S. District Court, Northern District of California in Oakland, California, granted final approval to the settlement of the lawsuit on behalf of all non-U.S. citizens employed by TCS within the state of California from 14 February 2002 to 30 June 2005. The workers claimed that they were forced to sign over their federal and state tax refunds to their employer, as well as stating their Indian salaries were wrongfully deducted from their U.S. pay.[129] On 22 February 2013, the company entered into an agreement to settle for a sum of ₹16,163 lakhs ($29.75 million), this class-action suit filed in a United States Court relating to payment to employees on deputation.[77]

A US grand jury has slapped two companies of India‘s Tata Group – Tata Consultancy Services and Tata America International Corp – with a US$940 million fine in a trade secret lawsuit filed against them. Epic Systems had accused TCS and Tata America International Corp, in a lawsuit filed in October 2014 in US District Court in Madison which was amended in January and December 2015, of “brazenly stealing the trade secrets, confidential information, documents and data” belonging to Epic.[130] This Epic Systems lawsuit against TCS was closed and settled with an undisclosed out of court agreement that was completed in January 2018.

A federal class-action lawsuit accusing Tata Consultancy Services Ltd. of bias against U.S.-born workers could be heard by the Court during a Jury Trial starting in November 2018. The US Federal Court Case in Northern District of California (Buchanan v. Tata Consultancy Servs., Ltd., 4:15-cv-01696) is one of seven across the USA asserting that several large off-shore and national IT staffing companies with operations in the US, prefer foreign workers from South Asia over qualified Americans. All of the companies being sued are heavy users of H-1B guestworker visas, which go to skilled professionals in “specialty occupations.” The US Federal District Court Case 15-cv-01696-YGR seeks to consolidate these lawsuits against TCS and several other IT staffing companies into a class action trial and is allowed by the Federal District Court to proceed (but not yet certified) with a possible November 2018 Jury Trial.

Accusations of discrimination

In May 2013, the Canadian Broadcasting Corporation (CBC), in its extensive coverage of the hiring of temporary foreign workers in Canada and the unemployment issues faced by Canadians, reported that TCS rarely hires skilled experienced Canadians at the Toronto offices while advertising open positions in Canada. TCS responded that the company hired more than 125 Canadian workers in 2013 who make less than 1.2% of the 10,452 workers the company has outside of India.[77][131]

In April 2015, a class-action lawsuit against TCS was filed in a San Francisco federal court by a U.S. information technology worker and ex-employee, who accused the company of discriminating against American workers by favoring South Asians in hiring and promotion. The lawsuit claimed that South Asians comprise 95% of the company’s 14,000-person U.S. workforce and that TCS engaged in discriminatory practices by sourcing most of its workforce through the H-1B visa program, by focusing its U.S.-based hiring disproportionately on South Asians and by favoring South Asian employees in its human resources practices. In response, TCS refuted the plaintiff’s claims, assuring that it is an equal opportunity employer and bases its employment practices on non-discriminatory reasons. A spokesperson said that in 2014 alone the company had recruited over 2,600 U.S. hires.[132]

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