Outsourcing: Ankur Prakash, Vice President And COO, TCS Latin America (Part 4)

By Sramana Mitra and guest author Aditya Modi

Sramana Mitra: In terms of dynamics of geography, in India, for example, we see that the big cities where the outsourcing industry really got started and matured such, as Bangalore, Hyderabad, Chennai, Mumbai, New Delhi, Gurgaon, and Noida, have become very expensive, and companies like yours are actually moving out to second- and third-tier cities. What is the parallel scenario in Latin America? Are we still in the major capitals like the Buenos Aires, Sao Paulo, Rio, and Santiago, or is it a more distributed model?

Ankur Prakash: I don’t want to comment on what TCS is doing in India because that is out of my area. But to compare the major cities of India with those of Latin America might not be a good comparison. If you take the capitals of Latin American countries, for example; Sao Paulo has a population of approximately 20 million, which is 10% of the total population of Brazil, which is 200 million. You take Santiago, where approximately 40% of Chile’s population lives. If you take Mexico City, almost 20% of the population of Mexico lives there. So, if you just look at the tier 1 cities, as you would like to call them, of these major countries, you will find that the majority of the population lives in these cities. This is not essentially the case in India because of the larger population. So, it is not because they are tier 1 cities and expensive; rather, our objective is that we have to be where the talent is. If the talent is available currently in those tier 1 cities, we will go to those cities, and tomorrow if we see more talent in tier 2 cities, we will be more than happy to move there.

Sramana: I think not only the talent but also, Latin America has a more concentrated distribution of people than India does. It seems that for the foreseeable future, all of your work and the work of your industry is going to be concentrated in may be 10 or 15 cities in Latin America?

Ankur: Absolutely correct!

Sramana: OK, that is an interesting insight. What about technology? We cover Latin America on this blog, so we have some perspective into the rates of broadband adoption, mobile adoption, and so on. What are the dynamics of the infrastructure in general that you are affected by or that you have to keep an eye on?

Ankur: I think technology is just a tool, I don’t think that technology is the final objective for anybody. Technology is just a tool to achieve your business objectives, so whether it is a country or a city, they use technology to reach and to achieve their goals. We treat technology in the same breath because today it is one technology, yesterday it was something else, and tomorrow it could be something completely different. The most important thing for us is how we can understand a business situation for customers, and that is where we want to put our emphasis, and that is where we want to train our employees and that is where we want to ensure that we excel.

Sramana: I understand that. I think the question is coming more from the point of view of the early days of the Indian outsourcing industry, when bandwidth was still expensive. Internet penetration was lower, bandwidth availability was expensive, and you needed dedicated lines, broadband lines, and so forth coming into your offices. My question is more about that part of the outsourcing industry’s ability to perform on a global scale, predicated upon a certain level of infrastructure, especially communications infrastructure.

Ankur: In that respect, all these Latin American countries are much more advanced than India of the 1980s. They are much more advanced in they way they work. It is much more intrinsic, and broadband is just a phone call away. The overall infrastructure support that the governments give is also tremendous; not only in terms of the physical infrastructure but also in terms of the digital infrastructure.

Sramana: Would you talk more about the role governments play in the development of these nations, and what is your relationship with the various Latin American governments?

Ankur: In all these countries in which we are present, we have a good working relationship with the government and we really believe that until and unless there is blessing from the local government, it becomes a tremendous task to achieve our objectives. You will not find tax-free zones the way we have in some other parts of the world, but definitely the government will help you to find the right partner, to find the right place, help you in terms of infrastructure, capital expenditure, training, getting connected with the universities, getting the right talent and resource pools. All these things are absolutely important for business like ours, and we get lot of support from the governments in the region.

This segment is part 4 in the series : Outsourcing: Ankur Prakash, Vice President And COO, TCS Latin America
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