Why Tata Consultancy Services Created a Commercial Software Business
Over the past several weeks I have had some conversations with a new division of Tata Consultancy Services (TCS) that is offering digital software and solutions with a strong focus on data integration. While TCS itself provides solutions to customers through its consulting services, this new business unit is creating a self-sustaining organization based on analytics of customer and urban data.
Where does Digital Software and Solutions fit?
But first a little context. Tata Consultancy Services is a major business unit within the larger Tata Corporation. Like many multi-national companies, Tata offers a wide variety of products and services including everything from power generation and rail services, to insurance, chemical manufacturing, steel production and voice services. The company employees over 600,000 people and operates in more than 100 countries with revenue of $108.78 billion. This blog will focus not on the entire holding company but a single business unit within Tata Consultancy Services called Digital Software and Solutions Group. The business unit, headed by Seeta Hariharan, has been established as a group that is independent from the systems integration organization. The objective of the group is to sell licensed software including:
- TCS Customer Intelligence and Insights (CII) for Banking and Financial Services
- And TCS Intelligent Urban Exchange (IUX) that is intended to help clients accelerate the development of customer and citizen centricity initiatives.
The goal of the TCS Digital Software and Solutions organization is to focus on creating solutions targeting specific markets. Unlike a systems integrator, the Digital Software and Solutions group is creating a reusable software platform that is complemented by domain specific applications that are both vertical by industry and horizontal (data integration and analytics). Here is what I took away from these early discussions with TCS’s Digital Software and Solutions group.
- TCS’s Digital Software and Solutions group is building a set of data-driven solutions. The first solutions are focused on city infrastructure, retail banking, and government agencies including water and transportation.
- The vertical solutions are intended to concentrate on customer and citizen engagement
- Operations management is based on an implementation of the Customer Intelligence & Insights platform
- The focus will be on both unstructured data from sources like social media as well as structured data from transactional systems.
- TCS’s Digital Software and Solutions offers a data integration platform that can aggregate a variety of third party tools and technologies. This integration is performed through a software development kit and published APIs. The base platform is an analytics engine and includes data ingestion and other data management engines.
- The industry led solutions are designed in a modular fashion. TCS has the luxury of being able to create software in an era where modularity is the norm. Therefore, TCS Digital Software & Solutions is building solutions as a set of modular software applications. Some of these applications industry specific and others that are common analytic services used as the foundation for all services.
The bottom line
One of the most complex tasks for traditional services led companies is to be able to make the transition to becoming a software company. While there are some successes there have also been failures. One of the strategies to succeed is to establish an independent organization with its own sales team, budget, and revenue targets. These revenue targets should be in-line with those of an established software company that is branching out into new territory. If TCS has the patience to keep progressing on this journey it has an opportunity for success.