Executive Summary

Creating customer value: - TCS

The IT industry has its wings all over but to be the swan in the pack of ducks
a niche quality needs to be adopted. Considering the present market
sentiments where the customer is the ‘King’ what is more appropriate than
to have considerable efforts put in for Creating Customer Value.

Customer value is the difference between what a customer gets from a

product or service, and what he or she has to give in order to get it. The
most successful organizations understand that the purpose of any business
is to create value for customers, employees, and investors, and that the
interests of these three groups are inextricably linked.

Tata Consultancy Services is an IT services, business solutions and

outsourcing organization that delivers real results to global businesses,
ensuring a level of certainty no other firm can match. To align with its vision
to be ‘Global Top 10 By 2010’ it has to categories its efforts in satisfying 4
parameters namely: -

• Voice of Customer: - Market /Business insight

• Voice of Technology: - New Competencies

• Voice of Employees: - Institution Building Insight

• Voice of Shareholders: - Knowledge Generation

It being in a Business to Business service industry TCS has to concentrate

more on its Quality of Output, its Employee Welfare Programs and
Innovation.

We have found TCS successful in the implementation of the following

analysis models to test its Customer Value Factor –

• Waterfall model – systematic flow for the project and analysis at each
stage.

• COIN – it is an innovation process following a 360 network system.

• Six Sigma – Effective mechanism to focus on customer requirements

through improvement in process quality

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• TQM – Their Quality Management processes to ensure that the service
they deliver has minimal defects.

Lastly some of our recommendations have been included for TCS which will
help it to maintain its position of the ‘GLOBAL TOP 10’ in this era of constant
challenges in speed and innovation.

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 INTRODUCTION

Tata Consultancy Services (TCS) was established in the year 1968 and is
considered a pioneer in the Indian IT industry.

About TCS

Tata Consultancy Services is an IT services, business solutions and

outsourcing organization that delivers real results to global businesses,
ensuring a level of certainty no other firm can match.

TCS is one of the largest IT Company & Largest software exporter in India. It
is the first Company in the world to receive an integrated Enterprise wide
CMMI Level 5 and PCMM Level 5 assessment. It has the largest Research &
Development Centre, and also the largest Training center- which has the
ability to train 1000 people at a time.

VISION
Global Top 10 by 2010

MISSION
To help customers achieve their business objectives, by providing
innovative, best-in-class consulting, IT solutions and services.To make it a
joy for all stakeholders to work with us.

VALUES
Leading change, Integrity. Respect for the individual. Excellence. Learning
and sharing

Corporate Information

TCS has over 143,000 of the world's best trained IT consultants in 42

countries.

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Revenue of $6.0 billion (fiscal year ending 31 March, 2009).

Awards

TCS tops the DataQuest DQTop20 list of IT Services providers in India for
2008

TCS ranked among Top 25 in Business Week's 2007 Information Technology

100

TCS awarded top position in 2007 "Global Services" 100 ‘Top 10 Best
Performing IT Services providers’ category

SERVICE PORTFOLIO

TCS offers a consulting-led, integrated portfolio of IT and IT-enabled services

delivered through its unique Global Network Delivery Model™, recognized as
the benchmark of excellence in software development. Some of the
industries catered by them include :-

Engineering &
Asset Based
IT Services Industrial
Services Solutions

IT Global
Infrastructur BPO
e Services Consulting

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 Energy&
utilities RevenuefromIndustryVertical
3%
Transportation
3% Others
Retail 9% BFSI
7% 42%

Life Sciences
and Healthcare Telecom
4% 17%
Manufacturing
15%

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MARKET ANALYSIS OF TCS

TCS OTHER SOFTWARE SERVICES

PRODUCTS
TECHNOLOGY
SOLUTIONS
TCS Data Cleansing TCS Clin-E2e IT Services
Framework

TCS Business Rules TCS Hospital IT Infrastructure Services

Engine Management Solution

TCS Experience Based TCS Silicone Ambulatory Enterprise Solutions

KM ECG Solution
TCS Call Device and TCS Enterprise Consulting
Management Solution Integration and Control
Environment Solution/

Energy and Utilities

TCS PKI Suite (Public Key TCS Bio-Informatics Business Process
Solution Outsourcing
Infrastructure)
TCS Certificate Validation Business Intelligence
Server

TCS File Authentication Engineering &Industrial

Solution Services
TCS e-Learning Small & Medium
Effectiveness Enterprises

Measurement Solution
TCS Code Generator
Framework

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SWOT Analysis

Strengths

Weaknes
s

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 Opportuniti
Threats
es

Opportuniti
Opportunitie
es
s

Threats

Management felt the conscious need to bring in changes in their approach

to the aforementioned weak areas, in order to align more closely with the
customer, business and market requirements at an organizational level.

Creating Customer Value

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What is Creating Customer Value?

Value is created when: (value of solution provided minus its cost) >
(value of next best alternative minus its cost). Value arises from the
way one works or from the unique aspects of the solution provided

The most successful organizations understand that the purpose of any

business is to create value for customers, employees, and investors, and
that the interests of these three groups are inextricably linked

Organisation Chart

Traditional Organisation Chart Modern Customer-

Oriented

Companies who believe the customer is the only true “profit centre”
consider the traditional organisation chart as shown above – a pyramid with
the president at the top, management in the middle, and frontline people
and customers at the bottom. This approach has become obsolete.
Successful companies invert the chart. At the top are customers; next in
importance are frontline people who meet, serve and satisfy customers;
under them are the middle managers whose job is to support the frontline
people so they can serve customers well; and at the base is top
management whose job is to hire and support good middle managers.

Paradigm shift

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We have already seen in the above diagram that customer has become the
main priority for any business. The customers today have changed from:

Isolated –> Connected

Unaware –> Informed

Passive –> Active

Reasons for the paradigm shift: -

Marketers face unprecedented challenges as cut-throat competition and new

service models undercut pricing, prey on lucrative customers, and disrupt
established markets

Today, operational profitability is no longer enough. Now business success is

dependent on delivering successful customer outcomes that increase loyalty
and reduce turnover and the associated high costs of customer acquisition.

Companies are scrambling to retain customers, induce loyalty, improve

customer satisfaction, and deliver appealing revenue-producing products.
This is becoming ever more difficult because of:

• Increased globalization
• Trends towards decentralization
• Proliferation of interactive digital media channels, social networks,
mobile messaging devices, and online communities

Reference for Value Creation: A Contrast

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Traditional frame of reference for Value Creation:-

The New Frame of Reference for Value Creation: -

Customer Value Creation at TCS

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 TCS being a part of a IT services industry faces the industry norm of
billing the client per day for the services provided by its employees. This in
turn puts more weight on analysing four voices of an organization i.e. ‘voice
of shareholder, employee, customer and technology’.

The Organizational Development interventions at TCS focused on balancing

tensions arising from these four voices along dimensions of strategizing,
valuing, serving, energizing, investing and improving.

The idea is to challenge the conventional ways of thinking and to give shape
to the key drivers of change through realistic listening and dialoguing.

These looked at what TCS was and what they wished to be, their
competition, changes and challenges with regard to their business models,
technologies, products and support functions.

The scenarios addressed the nature of the struggle the organization would
go through and etched out realistic possibilities based on present factors.

The roles and context were based on the following:

• Wealth creation

• Factors which will enhance productivity and enhance the feeling of being
valued

• Resource allocation and team-work

• Membership criteria and norms of the group

• Learning opportunities for individuals and teams

Organizational Development, Goal alignment and balanced

scorecard

In organizations worldwide today, there is a greater realization of the

importance of Organizational Developmental (OD) interventions in
facilitating the rapid changes brought about in the current competitive
environment. Organizations today struggle to balance the tensions between
Voice of Customer, Voice of Technology, Voice of Strategy and Voice of
Employee.

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With this view to attain better alignment and balance, a need was felt to re-
look at a few organizational processes and systems, for instance, the
performance management and appraisal system at TCS.

A Teach-Train-Transfer workshop on Goal alignment was conducted,

with help from expert OD consultants to build the context, to think through
goal setting at TCS with a systems perspective to goal alignment & to
explore means of institutionalizing goal-oriented performance management
within the organization.

A concept of the Personal Score Card was introduced, which clearly

outlined what would define goals, outputs, performance management.

The Balanced Scorecard approach was proposed, introducing

corporate goals, which also touched upon the following:

• Voice of the Shareholder - Financial Goals e.g. Wealth creation

• Voice of Technology – Technology Goals e.g. Quality, Cost, Delivery
dimensions
• Voice of the Customer – Customer/ Market Goals e.g. Customer
Satisfaction
• Voice of the Employee – Learning & Development e.g. Employee

These have become increasingly important in the context of a globalized

and dynamic market, which makes competitive advantage and sustainability
the key mantras of corporate survival and success.

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 Voice of Knowledg
Shareholder e

Cash
Generation

Institution Market/ Business

Voice of Voice of
Building Insight
Employee Customer
Insight

Employee Customer
Satisfaction Satisfaction
Index Index
Voice of Voice of
Shareholder Voice of New Shareholder
Technology Competencies

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Voice of Customer

WATERFALL MODEL – To value Customer Voice

CLASSIC WATERFALL MODEL

The waterfall model is a sequential software development process, in which

progress is seen as flowing steadily downwards (like a waterfall) through the
phases of

• Requirement Gathering (Conception)

• Design (Validation)
• Implementation (Construction)
• Testing (Verification)
• Maintenance

To follow the waterfall model, one proceeds from one phase to the next in a
purely sequential manner. For example, one first completes requirements
specification, which is set in stone. When the requirements are fully
completed, one proceeds to design. The software in question is designed
and a blueprint is drawn for implementers (coders) to follow — this design
should be a plan for implementing the requirements given. When the design
is fully completed, an implementation of that design is made by coders.
Towards the later stages of this implementation phase, separate software
components produced are combined to introduce new functionality and
reduced risk through the removal of errors.
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Thus the waterfall model maintains that one should move to a phase only
when its preceding phase is completed and perfected.

Disadvantages:

• Real project rarely follow the sequential flow that the model proposes.
• The waterfall model requires all requirements explicitly, but it is often
difficult for the customer to state all requirements explicitly. It is difficult
for customer to have unchanging requirements in realistic projects.
• A working version of the program will not be available until late in the
project time-span.
• Freezing the requirements usually requires choosing the hardware (since
it forms a part of the requirement specification). A large project might
take a few years to complete. If the hardware is selected early, then due
to the speed at which hardware technology is changing, it is quite likely
that the final software will employ a hardware technology that is on the
verge of becoming obsolete. This is clearly not desirable for such
expensive software.
• Project may miss functionality if not all requirements were captured in
the requirements stage.
• Bugs are expensive to fix and new requirements are expensive to
incorporate.
• Complete testing is not possible, as unit testing is not a taken into
consideration in this model.

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MODIFIED WATERFALL MODEL USED BY TCS

Advantages:

• Waterfall model provides a template into which methods for analysis,

design, coding, testing and support can be placed.
• Stages and activities are well defined
• Helps to plan and schedule the project
• Verification at each stage ensures early detection of errors /
misunderstanding

Total Quality Management (TQM):

TCS takes responsibility for the products and services it delivers. Their
Quality Management processes ensure that the service they deliver has
minimal defects. TCS also provides warranty periods in its contracts with its
customers for after-delivery service in the case of a defect.

TCS’s commitment to quality and schedules ensures that the client's needs
are met consistently. It adopts a systematic approach to problems and
encourages experimentation, innovation and creativity in finding feasible
solutions. Being a process-oriented organization, TCS believes that the

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definition of a good process and subsequent adherence to that process is a
critical part in ensuring a successful project.

Quality Management System: TCS’s Quality Management System (QMS)

is based on the ISO 9001:1994, IEEE standards, ISO 9001-3 and CMM
Guidelines. Well-defined architected processes are adopted for
development, implementation, maintenance and conversion projects. These
processes are defined in the Process Handbook documents which form a
part of the TCS QMS. TCS also conducts different reviews at different stages
of the project life cycle to ensure high quality.

Reviews: There are three levels of review that are performed- Internal
Quality reviews, performed by members of the project team, External
Quality reviews that are carried out by analysts external to the project
team and a Final Inspection to make sure all open defects and
suggestions have been closed.

The objectives of the review will be to ensure that-

• The project requirements are met.

• No errors have been introduced,
• Standards are adhered to,
• Testing has been adequate.

Testing: Different type of testing is done to make sure that the system
works at its most minute level, as well as a whole.

• Unit Testing: Testing each module/block as a single unit

• Integration Testing: Testing the different interfaces of the system to
make sure it works as a whole.
• System Testing: Testing the system for system level functionality,
security, external interface, usability and integration of the different
modules under it.
• Acceptance Testing: Based on pre-defined acceptance criteria, the
client conducts the acceptance test during this phase. The TCS team
provides support during this phase.

Here is a case on how they go about handling a customer complaint.

Project: GEHC.

Business Unit: Data warehousing

Tool: Informatica

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Task: Mapping to make data flow from source database in Oracle to target
database in Teradata subject to conditions and filters implemented in the
mapping

Error Handling:

--Run to workflow for particular mapping and check the data in source as
well as target tables in respective databases.

--Checking of data to be done using SQL querries and giving filters as per
client requirements

--If the target and source data do not match the expected results, then there
is an error

--To find the error source, use "debug" function in Informatica Manager Tool
and run the mapping step-wise as a trial run.

--In every step you get to see the results and then can find out which
field/key is not appropriate compared to expected result at every step.

--After debugging, on finding the exact table which is cause of error, edit the
mapping accordingly and re-run.

--Repeat the process till you get expected/correct result in target database.

SIX SIGMA PROCESS

Six sigma provides an effective mechanism to focus on customer

requirements through improvement on process quality. In TCS 6 sigma
projects are being carried out with the objective of improving on time
delivery, product quality and in-process quality.

6sigma quality quantitatively means that the average review process

generates 3.4 defects per million units when a unit can be anything
ranging from a component to a line of code. This implies that nearly
flawless execution of key processes is critical to achieve customer
satisfaction and productivity growth.

In TCS since 1998 ten six sigma projects have been completed. Six
sigma projects have been identified in the areas of improvement after
analysis of process and product against the centre level specification
limits.

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Voice Of Technology

TCS Co-Innovation Network (COIN)

Globalization has lead to higher competitions, in which competitors quickly

imitate sources of competitive advantage. Hence, it becomes necessary for
companies to successfully innovate on a sustained basis.

Globally Distributed Network (GDN) combined with the need for tapping
capabilities from other companies and the challenges of innovation delivery
helped Tata Consultancy Services (TCS) move to the next level i.e. ‘IT
Services Partner’ to ‘Innovation Partner’.

Disruptive innovations are not a result of a single technology invented by a

few people but a combination of various innovations along the entire
spectrum (idea generation to consumption) thus making it necessary to
collaborate. The framework of ‘Innovation Network’ is perhaps the only
sustainable way to deliver innovation in today’s environment. Innovation
networks as a concept is not completely new.

Typically it has been the technology delivery entity, e.g. Microsoft, IBM
driven innovation networks, or the research entity, e.g. Gartner, Google
driven innovation networks that has been controlling the network and thus
being the principle beneficiary.

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Client companies end up being customers of the innovation initiatives
coming out. In the case of TCS, it is one of the few instances of a client
driven innovation network where the research and delivery elements are
participants.

With that 360-degree outlook in mind, TCS has convened a global,

interconnected innovation ecosystem — the Co-Innovation Network, or COIN
— that links businesses large and small, well-established and new, with a
broad network of partners, suppliers, leading-edge vendors, outside
consultants, academic institutions, and venture capitalists. The prime
purpose of COIN is to create for IT and the business it supports the largest
possible “funnel” of innovative and profitable ideas from numerous,
collaborative sources inside and outside an organization. The key to
generating, sustaining, and profiting from innovation is to participate in a
multi-organization innovation network that creates a funnel of ideas full and
rich enough for some of them to survive the journey from thought to
business-transforming action. A true COIN framework needs to be developed
to strengthen two key aspects — the ideation — perspective and the
execution capability. One of the principle benefits of COIN is spreading the
risk of new undertakings across multiple partners to reduce each partner’s
individual risk, while spreading the search for new ideas across multiple
partners to increase the flow of ideas into the funnel and the flow of
innovation back to the partners. Once the funnel is filled with ideas,
management can take ideas from concept to implementation.

TECHNOLOGY EXCELLENCE GROUP

The job here includes interfacing with the organization on a technologically

enhanced level and provide the necessary updates.

GROUPWARE

Groupware has been defined as ‘computer based systems that support

groups of people engaged in a common task (or goal) and that provide an
interface to a shared environment’. People can share information without
constraint of time and place, and the tools would attempt to provide ‘just in
time’ information to users. Groupware attempts to augment ( rather than
replace ) human capabilities and needs software designed for
interoperability and openness.

GREEN IT

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Green has become a social and business imperative. Switching off monitors,
servers and unused equipments are equally necessary but as an engineer
we can do more to reduce IT’s energy footprint. TCS got started with Green
IT by becoming a member of Green Grid. Learn ways to leverage
technologies like virtualization cloud to save energy and develop efficient
solutions. Efficiency is not just about hardware but technologies like data de-
duplication, Flash storage, Tiering based on Service levels etc will also save
energy & resource cost.

NEXT GENERATION DATA CENTRES

The next generation data centers are going to be in a significant scale.

These data centers are definitely going to be 100% virtualized. Even
enterprise desktops are moving to the data center and virtual desktops will
be the de-facto standard of the future. The data center fabric will be
converged and 10Gb or 40 Gb fabric will bring in lots of consolidation in the
network. There will be a sophisticated management orchestration. Security
will be built in all the layers of the data center. Energy really matters in a
NGDC and they will be super efficient. NGDC will federate with a service
provider cloud to ramp up and down additional resources required.

Voice of Employee

KNOWLEDGE MANAGEMENT

 Includes learning from past projects, which also provide incentives to

create knowledge assets for new projects that can benefit clients in
future.
 Provides various online/offshore/onsite trainings and certification
courses.
 Trainings are pertaining to technology, client specific domain and
people skills related.

Current Initiatives

Account Excellence Plan:-

Scoring is done under each of the 7 categories and the score shared across
the relationship, to identify gap and action on these.

Nakshaktra Award:-

This is a Reward and Recognition initiative within the relationship. Nakshatra

is awarded to encourage star performers for each month within each

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Business Unit of the relationship. The unique feature of this initiative is that
even team members can nominate their peers.

In Touch:-

Is an interaction / mentorship initiative with the lead of the relationship,

wherein a certain timeframe is decided upon, during which any employee
can walk in to meet the lead and discuss out any problems/ suggestions for
improvement in the relationship.

Fun@ Relationship level:-

This was initiated to bring in a spirit of team camaraderie and to act as a

stress buster. There are champions within each unit who drive these fun
activities in the relationship.

Toast Master Club/Lets Talk:-

The main objective is to enhance personality/communication ability of

associates in the relationship and to help them gain confidence through
sessions by certified facilitators.

Open House/ Town halls:-

The objective was to encourage strategic communication, and to discuss the

larger vision and achievements at relationship level with all employees
across the Business Units. This also serves as a platform for recognizing
good performers and celebrating milestone achievements.

Associate Satisfaction Survey (Darpan):-

To gain an insight into the strengths and weaknesses in the relationship and
identify areas for improvement.

Walk the talk:-

A senior associate within the relationship takes any new joinee to the
relationship, on a tour of the facility. The aim of this initiative is to make the
new entrant feel valued. This is followed by a simple quiz to check the
effectiveness of this initiative.

Resource Management Group;-

In an IT industry where company assets are its Software engineers and

consultants and when the business revolves around the needs of the

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customer, The Objectives of Resource Management Group is to help
Operating Units by managing the workforce through effective Utilization
Planning and Resource Management Strategy that align with the business
situation and goals.

The responsibilities of RMG are multifold, key among which is to determine

the staffing needs of the organization and the mode of fulfill the same -
whether to use independent contractors or hire people to fill these needs
internally or externally, making sure that the technologies they imbibe are
relevant to the business, ensure they are high performers, people mobility
and execute the workforce strategy that align with the customer
expectation.

Voice of Shareholders

At TCS the voice of the Employees along with the voice of the
Customer and Technology helps achieve the Voice of the Shareholders in
form of the respect the brand name commands along with the financial
performance of the organization.

Recommendations:-

• Six sigma processes should be implementation on an organization

level.
• Strengthen client relationship by bringing out best from all client
interactions, by maintaining multi-level relationship with them and by
strengthening client facing systems and processes.
• Implement and monitor effective Program/Project Management
• Innovation: Customer service is necessary but not longer sufficient for
loyalty and retention. Faster Innovation is required to stay ahead of
competition. Innovation is not the “eureka moment” but the effective
execution of visioning and winning strategies.
• Prevail Through Speed: Time to market and realization of benefits
make the difference between leaders and followers. Leverage GDM,
tools, and accelerators to outpace competition.
• Succeed Through Predictability: Will help organization execute and
deliver projects on time within budget and with an error free track
record.

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