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INTRODUCTION
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HISTORY
1968 to 2000
Tata Consultancy Services Ltd was founded in 1968 by a division of Tata Sons
Limited. Its early contracts included providing punched card services to sister
company TISCO (now Tata Steel), fortune ranking 1 working on an Inter-Branch
Reconciliation System for the Central Bank of India, and providing bureau services
to Unit Trust of India.
In 1975, TCS conducted its first campus interviews, held at IISc, Bangalore. The
recruits comprised 12 Indian Institutes of Technology graduates and three IISc
graduates, who became the first TCS employees to enter a formal graduate trainee
programme.
In 1979, TCS delivered an electronic depository and trading system called SECOM
for the Swiss company SIS SegaInterSettle. TCS followed this up with System X
for the Canadian Depository System and automating theJohannesburg Stock
Exchange. TCS associated with a Swiss partner, TKS Teknosoft, which it later
acquired.
In 1981, TCS established India's first dedicated software research and development
centre, the Tata Research Development and Design Centre (TRDDC) in Pune.
In 1985, TCS established India's first client-dedicated offshore development centre,
set up for clients Tandem.
In early the Indian IT outsourcing industry grew rapidly due to the Y2K bug and
the launch of a unified European currency, Euro. TataConsultancyServices created
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the factory model for Y2K conversion and developed software tools which
automated the conversion process and enabled third-party developer and client
implementation.
2000 to present
On 25 August 2004, TCS became a publicly listed company.
In 2005, TCS became the first India-based IT services company to enter
the bioinformatics market.
In 2006, TCS designed an ERP system for the Indian Railway Catering and
Tourism Corporation.
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In 2008, TCS's e-business activities were generating over US$500 million in
annual revenues.
In 2008, TCS undertook an internal restructuring exercise which aimed to increase
the company's agility.
TCS entered the small and medium enterprises market for the first time in 2011,
with cloud-based offerings. On the last trading day of 2011, TCS overtook RIL to
achieve the highest market capitalisation of any India-based company.
In the 2011/12 fiscal year, TCS achieved annual revenues of over US$10 billion for
the first time.
In May 2013, TCS was awarded a six-year contract worth over 1100 crores to
provide services to the Indian Department of Posts.
In 2013, TCS moved from the 13th position to 10th position in the League of top
10 global IT services companies
In July 2014, TCS became the first Indian company to cross the Rs 5 lakh crore
mark in market capitalization.
In Jan 2015, TCS ends RIL's 23-year run as most profitable firm
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Tata Consultancy
Services onGrosvenor
Square, London
There are a number of reasons why the multinational companies are coming down
to India. India has got a huge market. It has also got one of the fastest growing
economies in the world. Besides, the policy of the government towards FDI has
also played a major role in attracting the multinational companies in India.
For quite a long time, India had a restrictive policy in terms of foreign direct
investment. As a result, there was lesser number of companies that showed interest
in investing in Indian market. However, the scenario changed during the financial
liberalization of the country, especially after 1991. Government, nowadays, makes
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continuous efforts to attract foreign investments by relaxing many of its policies.
As a result, a number of multinational companies have shown interest in Indian
market.
Company Background
Tata Consultancy Services (TCS) is an information technology consulting,
solutions and services organisation.The company is a part of one of Indias most
respected business conglomeratesthe Tata Group.TCS started its operations in
1968, and pioneered the IT services industry out of India. It has been the largest
Indian IT services company ever since its inception. The company offers business
process outsourcing (BPO), enterprise systems installation, offshore software
development and systems integration services.TCS also provides product and
industrial process engineering services as well as strategic consulting and project
management services.These services are provided to a spectrum of industries such
as banking, financial services, insurance, telecom, manufacturing, media and
entertainment, retail and consumer goods, transportation, health care and life
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sciences, energy and utilities, and s-Governance. Currently,TCS has over 62,000
employees, and it generated consolidated revenues of US$ 2.97 billion in the year
2005-06. The company has 169 offices in 35 countries and has 42 software
delivery centres in 11 countries. The North American arm of TCS has more than 50
offices, which approximately generates 60 per cent services.TCS also provides
product and industrial process engineering services as well as strategic consulting
and project management services.These services are provided to a spectrum of
industries such as banking, financial services, insurance, telecom, manufacturing,
media and entertainment, retail and consumer goods, transportation, health care
and life sciences, energy and utilities, and s-Governance. Currently,TCS has over
62,000 employees, and it generated consolidated revenues of US$ 2.97 billion in
the year 2005-06. The company has 169 offices in 35 countries and has 42
software delivery centres in 11 countries. The North American arm of TCS has
more than 50 offices, which approximately generates 60 per cent
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100 per cent subsidiary of TCS. In addition to the 950 Diligenta staff,TCS (UK)
currently has 200 permanent employees, consisting of both local and Indianexpatriates.There are approximately 2000 consultants providing onsite services to
clients in the UK in over 40 locations. Further, there are another 3000 consultants
across the world (mainly India) that provides offshore services to the UK clients.
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transportation, media, utilities, retail and public sector The company has alliances
with major companies such as Microsoft, IBM, Oracle and SAP. TCS has
expanded its capabilities through research and academic relationships with
universities in the country, including Kings College, London;
The Imperial College and the University of York. It has over 130 clients in
the UK, in both commercial corporations and the public sector. Some major TCS
projects in the UK are provided in detail in the tables below. TCS is also a member
of and involved with organisations such as the Confederation of British Industry,
the Intellect, Management Consultancies Association, the European Technology
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and from this point of view, their business strategy extends over a number of
products and over a number of countries.
1. MNCs are playing a major role in the globalisation process.
2. More and more goods and services, investments and tech- nology are
moving between countries.
3. Most regions of the world are in closer contact with each other than a few
decades back.
As the new Leviathans of our time, multinational corporations are:
[P]ractically in every sphere of modern life, from policy making in regard to the
environment and international security; from problems of identity and community;
and from the future of work to the future of the nation state.
Gabel and Bruner (2003)
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The second contribution relates to filling the foreign exchange or trade gap. An
inflow of foreign capital can reduce or even remove the deficit in the balance of
payments if the MNCs can generate a net positive flow of export earnings.
3. Filling Revenue Gap:
The third important role of MNCs is filling the gap between tar- geted
governmental tax revenues and locally raised taxes. By taxing MNC profits, LDC
governments are able to mobilize pub- lic financial resources for development
projects.
4. Filling Management/Technological Gap:
Fourthly, Multinationals not only provide financial resources but they also supply a
package of needed resources including management experience, entrepreneurial
abilities, and techno- logical skills. These can be transferred to their local counterparts by means of training programs and the process of learn- ing by doing.
Moreover, MNCs bring with them the most sophisticated tech- nological
knowledge about production processes while trans- ferring modern machinery and
equipment to capital poor LDCs. Such transfers of knowledge, skills, and
technology are assumed to be both desirable and productive for the recipient
country.
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(d) MNCs expenditures on research and development(R&D),
although limited is bound to benefit the host country.
Apart from these there are indirect gains through the realiza- tion of external
economies.
1. Although MNCs provide capital, they may lower domes- tic savings and
investment rates by stifling competition through exclusive production
agreements with the host governments. MNCs often fail to reinvest much of
their prof- its and also they may inhibit the expansion of indigenous firms.
2. Although the initial impact of MNC investment is to im-prove the
foreign exchange position of the recipient nation, its long-run impact may
reduce foreign exchange earnings on both current and capital accounts. The
current account may deteriorate as a result of substantial importation of in-
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3.
4.
5.
6.
7.
8.
9.
termediate and capital goods while the capital account may worsen because
of the overseas repatriation of profits, in- terest, royalties, etc.
While MNCs do contribute to public revenue in the form of corporate taxes,
their contribution is considerably less than it should be as a result of liberal
tax concessions, excessive investment allowances, subsidies and tariff
protection pro- vided by the host government.
The management, entrepreneurial skills, technology, and overseas contacts
provided by the MNCs may have little impact on developing local skills and
resources. In fact, the development of these local skills may be inhibited by
the MNCs by stifling the growth of indigenous entrepreneur- ship as a result
of the MNCs dominance of local markets.
MNCs impact on development is very uneven. In many situations MNCs
activities reinforce dualistic economic structures and widens income
inequalities. They tend to promote the interests of some few modern-sector
workers only. They also divert resources away from the production of
consumer goods by producing luxurious goods demand- ed by the local
elites.
MNCs typically produce inappropriate products and stimu- late
inappropriate consumption patterns through adver- tising and their
monopolistic market power. Production is done with capital-intensive
technique which is not useful for labour surplus economies. This would
aggravate the un- employment problem in the host country.
The behaviour pattern of MNCs reveals that they do not en- gage in R & D
activities in underdeveloped countries. How- ever, these LDCs have to bear
the bulk of their costs.
MNCs often use their economic power to influence govern- ment policies in
directions unfavourable to development. The host government has to provide
them special economic and political concessions in the form of excessive
protec- tion, lower tax, subsidized inputs, cheap provision of facto- ry sites.
As a result, the private profits of MNCs may exceed social benefits.
Multinationals may damage the host countries by sup- pressing domestic
entrepreneurship through their supe- rior knowledge, worldwide contacts,
and advertising skills. They drive out local competitors and inhibit the
emergence of small-scale enterprises.
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There are now 40,000 TNCs whose tentacles straddle the inter- national economy
through some 2,50,000 overseas affiliates. They possess staggering resources as
would be clear from the fact that the sales of 200 top corporations in 1982 were
equiva- lent of 24.2 per cent of the worlds GDP and had risen to 28.3 per cent of
the worlds GDP in 1998.
This shows that 200 top MNCs control over a quarter of the worlds economic
activity. In fact, the combined sales of these 200 MNCs estimated at $ 7.1 trillion
in 1998 surpassed the combined economies of 182 countries. If we subtract the
GDP of the big nine economies ---the United States of America, Japan, Germany,
France, Italy, the United Kingdom, Brazil, Canada and China ---from the worlds
GDP, the GDP of the remaining 182 countries of the world stood at $ 6.9 trillion in
1998 which was less than the sales of the 200 top MNCs.
An idea of the giant size of these MNCs can also be had from the revelation made
in a study conducted by the Washington based Institute of Policy Studies (IPS) that
of the 100 largest econo- mies in the world, 51 are corporations; only 49 are
countries.
The above data show the massive control exercised by the MNCs on the world
economy. In fact, because of their huge capital re- sources, latest technology and
worldwide goodwill, MNCs are in position to sell whatever product they choose to
manufacture in different countries. The fact is that people in underdeveloped
countries are crazy for the products of these corporations and prefer their
products to the products produced indigenously.
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1) Expansion of market territory.
2) As the operations of a large size firm expand and as its in- ternational image
builds up, it seeks more and more exten- sion of its activities beyond the
physical boundaries of the country in which it is incorporated.
3) Marketing superiorities: A multinational firm enjoys a num- ber of marketing
superiorities over the national firms:
A)
B) It enjoys market reputation and faces less difficulty in sell- ing in production.
C) It adopts more effective advertising and sales promotion technique use and .
D) It has efficient warehousing facilities due to lower inven- tory requirements.
4) Financial superiorities: A multinational firm enjoys the fol- lowing financial
superiorities over the national firm :
A) It has huge financial resources with which it can easily turn
on circumstances in its favour.
B)It maintains a high level of funds utilization by generating funds in one country
and using them in another.
C)It has easier access to external capital markets.
D) because of its international reputation it is able to rise more international
resources even investors and banks of the host country are eager to invest in it.
Technological superiorities:
The main reason why MNCs have been encouraged by the un- derdeveloped
countries to participate in their industrial devel- opment is on account of the
technological superiorities which these firms possess as compared to national
companies. The under developed countries regard transfer of technology from
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MNCs useful on account of the following reason: 1) Industri- alization represents
the most important way out of under de- velopment and the resources of these
countries are insufficient to sustain the industrial progress on their own; 2) Local
man- power, materials, Local capital equipment etc have to be opti- mally
exploited and these countries are unable to accomplish these; 3) Depending totally
on local companies would required heavy imports of raw materials, capital
equipment, machinery and technical knowledge whereas MNCs bring these on
their own; and 4) The underdeveloped countries have to face stiff competition for
selling their products in international markets. Unless their goods meet
international standards and quality specifications, they cannot sell. MNCs help
them in producing such goods.
OPERATIONS
TCS have 230 offices across 46 countries and 147 delivery centers in 21
countries. At the same date TCS had a total of 58 subsidiary companies.
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Locations
TCS has operations in the following locations:
India: Ahmedabad, Bangalore, Baroda, Bhubaneswar, Chennai, Coimbatore, Patna,
Delhi, Gandhinagar, Goa, Gurgaon,Guwahati, Hyderabad, Bhopal , Indore, Jamshe
dpur, Kochi, Kolkata, Lucknow, Mumbai, Nagpur, Noida, Pune andTrivandrum
Africa: South Africa, Morocco(closed down)
Asia (excluding India): Bahrain, China, Israel, UAE, Hong
kong, Indonesia, Japan, Malaysia, Philippines, Saudi Arabia,Singapore, South
Korea, Taiwan, Thailand, Qatar
Australia: Australia
Europe: Belgium, Denmark, Finland, France, Germany, Hungary, Iceland,
Republic of Ireland, Italy, Luxembourg,Netherlands, Norway, Portugal,
Spain, Sweden, Switzerland and United Kingdom.
North America: Canada, Mexico and United States.
South America: Argentina, Brazil, Chile, Colombia, Ecuador, Peru and Uruguay.
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Tata Consultancy
Services,Hyderabad
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Lucknow
DISADVANTAGES OF MNCS
Roses does not come without thrones. Disadvantages of having an MNCs in a
developing country like India are as under
Competition to SMSI
Pollution and Environmental hazards
Some MNCs come only for tax benefits only
Exploitation of natural resources
Lack of employment opportunities
Diffusion of profits and Forex Imbalance
Working environment and conditions
Slows down decision making
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Economical distress
MNCS IN INDIA
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It is too specify that the companies come and settle in India to earn profit.
A company enlarges its jurisdiction of work beyond its native place when they get
a wide scope to earn a profit and such is the case of the MNCs that have flourished
here. More over India has wide market for different and new goods and services
due to the ever increasing population and the varying consumer taste. The
government FDI policies have some how benefited them and drawn their attention
too. The restrictive policies that stopped the company's inflow are however
withdrawn and the country has shown much interest to bring in foreign investment
here.
Besides the foreign directive policies the labour competitive market, market
competition and the macro-economic stability are some of the key factors that
magnetize the foreign MNCs here.
Following are the reasons why multinational companies consider India as a
preferred destination for business:
Huge market potential of the country
FDI attractiveness
Labor competitiveness
Macro-economic stability
WORKING AT TCS
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WHAT OUR EMPLOYEES SAY
Working for TCS is more than a job. Call it an adventure, a thrilling roller coaster
ride that combines work and personal life. Since joining 19 months ago, Ive been
able to experience diverse fields and environments, and had the opportunity to take
the lead on a number of initiatives. Most importantly, I know that even more
challenges await me in my futures roles within the company.
Alina Buzgar, HR Generalist, Bangalore, India
TCS has provided me the opportunity to see the global business environment we
operate in with much greater clarity and understanding. Its an honor to work for a
company that balances its passionate drive to compete and win with values and
principles committed to the greater good.
Robert Kane, Director and General Manager of the Northeast Region, New York
City, USA
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New horizons, ongoing education: A wealth of diversity in culture, training,
knowledge, and experience gives employees incredible opportunities to learn and
expand their horizons.
Leading-edge innovation, 24/7: Innovation isnt just a buzz word at TCS; its one
of the pillars on which our entire business operates.
A diverse, global peer community: We are committed to bringing our best people
to bear on client projects regardless of where they may be located. This means
that you get to work with people across continents and organizational functions.
COMPETITORS:
Infosys
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Mahindra Satyam
Wipro
HCL
Patni Computer
Financial Tech
Oracle
IBM
Cap gemini
Accenture
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Resource Pool TCS has developed a strong resource pool providing skilled
manpower to clients in the UK. To serve its clients,TCS uses a combination of
locally recruited employees and employees from other regions. Locally recruited
employees provide an understanding of the local business environment, whereas
employees from various regions facilitate in deploying global best practices.
Support from the UK government Another reason for the success of TCS in the UK
has been the support received from the UK government.The UK government has
been a good enabler and facilitator in promoting off-shoring of services, which in
turn make UK companies more competitive in their own markets.This has
facilitated the company to establish and increase its business in the UK.
AWARDS
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TCS was awarded the Business Standard's Company of the Year award for
2012.
In 2012, the company won Gold Shield award for excellence in financial
reporting from the Institute of Chartered Accountants of India (ICAI).
The company won 'Recruiting and Staffing Industry Leader of the Year' and
Best Employer Brand awards at the World HRD Congress' annual meet in
2012.
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ACHIEVEMENTS/ RECOGNITION:
TCS is the only IT services organization to be a part of ISO 15926 real time
interoperability network grid (iRING) Version 1.0.0
TCS tops the DataQuest DQTop20 list of IT Services providers in India for
2008
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TCS awarded top position in 2007 'Global Services' 100 Top 10 Best
Performing IT Services providers category
TCS was awarded the Business Process Outsourcing Service Provider 2011
at the Frost & Sullivan Asia Pacific ICT Awards ceremony hosted in Singapore.
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CONCLUSION
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We believe that the current program also provides a competitive base rate of
pay, which allows the Company to retain the critical talent and leadership of the
Named Executive Officers when a market downturn takes place and no bonuses are
paid, such as we experienced in 2005 and 2006. With the addition of the longerterm components of our Long-Term Incentive Plan, we believe we have created a
positive bond to the corporation, giving our Named Executive Officers equity
interests and goals that are closely aligned to those of our public stockholders.
We believe that the pay program design, award/pay levels and performance
targets are structured to support the optimum delivery of business results.
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BIBLIOGRAPHY:-
WEBSITES: http://www.google.com
http;//www.wikepedia.com
http;//www.tcs.com
http://www.greenworldinvestor.com/advantages-and-disadvantages-ofmncs
http://business.mapsofindia.com.