Tata #3: Creating an Industry from Scratch

Flashback to the 70’s. IBM didn’t dominate the mainframe market yet. A company called Burroughs was also a contender. Burroughs had a joint venture with the Tatas to sell and maintain Burroughs in India. It gave the fledgling TCS a toehold to the world of computers and international projects, writes Shashank Shah in The Tata Group. Until the partnership ended in 1978.

 

Suddenly TCS, a company of engineers only, had to find customers and clients. Faqir Kohli was pulled in from Tata Power. Though reluctant to move to what seemed like a career dead end company, he was persuaded by JRD Tata.

 

Kohli persuaded Burroughs to sign the first outsourcing contract in Indian IT history. At a time when TCS didn’t even have a single Burroughs machine! Importing one was impossible in those days. So TCS acquired an ICL computer from LIC (whose trade unions wouldn’t allow LIC to use it since they feared computers would wipe out jobs):

“TCS built an ingenious filter to transfer the system from ICL to a Burroughs system.”

Porting software across systems – it was a vital skill TCS had acquired.

 

As Burroughs started to fade in the 80’s, international demand to port files from Burroughs systems to IBM mainframes grew. TCS was perfectly placed for such an opportunity.

 

In the mid-80’s, C++ was a new programming language, a new way of programming. TCS took a risk and sent its personnel overseas to learn the yet to be proven language. As C++ grew in popularity, TCS was ready to meet the demand for C++ programmers. The ability to anticipate trends was useful yet again when the Y2K problem surfaced – TCS was ready for that too.

“Often described as the Henry Ford of IT services, Kohli-led TCS moved software development from artisan-like activity to an industrial assembly line of a software factory.”

By the time Kohli retired in 1999, over two lakh programmers drove the IT revolution in India.

 

Initially, TCS served as a body-shopping firm – they’d hire people in India who would then be sent to the US to work as contractors. Over time, the company switched to the on-site project management model. Here, TCS would be accountable to deliver the entire project, working closely (on-site) with the client. The third model was the offshore one. In this, most people working on the project stayed in India, while a few went on-site to coordinate with the client. This last model is now called the on-site-offshore model of software delivery.

 

Today, TCS has over 4,00,000 employees, annual revenue of over $20 billion, and a market value of over $100 billion. It has come a very long way.

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