Mahindra Satyam keen on BPO acquisitions
The board of directors of Mahindra Satyam, formerly known as Satyam Computer Services Ltd, is said to have given the official green signal to its back-office unit to create BPO facilities through buy-outs. The latest move, aimed at making amends for the backslide, is being viewed as a notable improvement in the history of the erstwhile Satyam Computer Services that was on the verge of collapse in 2009 before it was acquired by Tech Mahindra. According to sources, if the plans go right, Mahindra Satyam BPO may settle on acquiring as many as three firms in the range of $50 to $100 million.
Quoting the CEO of Mahindra Satyam BPO, Vijay Rangineni, a news website reports that the company was being selective regarding the manner in which it desired to set up the proposed platform-based system. According to him, his firm was ready for organic as well as inorganic ways to set up a platform BPO system that could be utilized for delivering services to clients using cloud computing. He said that in the event of the company getting the precise target; it might not kill time by waiting to avail the restarted accounts of the company.
It may be noted that usually BPO firms make use of the prevailing technology platforms of their clients to provide process outsourcing facilities, but in the instance of a platform-based BPO, the vendor offers technology platform as well as service. Precisely speaking, platform BPO denotes a cluster of services, including information technology, business process outsourcing and consulting, requiring the clients to make a minimum direct investment. In addition, the system also enables the client to enter into ‘pay-per-use’ deals with the BPOs.
The principal analyst at Forrester, Sudin Apte was the first to speak on this subject in a latest report published by the research firm. According to Apte, besides the fact that Mahindra Satyam was too concerned with issues related to the firm’s survival, restricted cash availability thwarted the company from spending on next-gen IT services like establishing onshore and near-shore facilities, building IP-based solutions, introducing the latest offerings based on cloud-computing and SaaS as well as developing managed services based on platform BPO.
In fact, while Mahindra Satyam was struggling to maintain its existence during the last one year, its major rivals, particularly Tata Consultancy Services, Infosys, Wipro, HCL and Cognizant were endowing to develop new facilities. At that time, the BPO arm of Mahindra Satyam was considered to be among the major unprofitable centers and it was losing approximately INR 4 to 5 crore each month.