INDIA BUSINESS WORLD - JUNE 2006
THE MONTH THAT WAS...

IBM TO BRING $6000000000

  EXPECTATIONS had been running high. It was a given that IBM chairman Sam Palmisano would make a bigbang announcement in Bangalore at the largest assembly of IBMers outside the US — over 10,000 with a median age of 24. That the setting was the regal Palace grounds and the chief guest none other than President Abdul Kalam, only added to the gravitas of the event. And, the man running the biggest IT company in the world didn't disappoint.

Palmisano said Big Blue would make a fresh investment of nearly $6 billion over the next three years in India, sending a strong signal about the growth prospects in India and the expectations the company has from this market to maintain its leadership in the global arena. This, surely ranks as the largest investment announced by an MNC in India .

Palmisano said, “If you are not here in India , making the right investments and finding and developing the best employees and business partners, you won't be able to combine the skills and expertise here with skills and expertise from around the world in ways that can help our clients to be successful.” He added, “I'm here today to say that IBM is not going to miss this opportunity. In the next three years, we will triple our investments in India from $2 billion over the last three years to nearly $6 billion (Rs 27,000 crore)....we will continue to invest heavily in India”, to thunderous applause from the assembled crowd that included the chief minister of Karnataka, senior bureaucrats and industry leaders.

Though IBM did not provide a break-up of how this sum would be spent, or by how much its headcount would rise in India (it currently employs 43,000 people), the company broadly said the increased investments would go into several areas like automating IT service delivery centres in Bangalore, creating IBM systems and technology group (STG) innovation, development and executive briefing centre in Bangalore, telecommunication research and innovation centre at its India Research lab.

THIRTEEN percent of its global employees call India home. This figure is headed only one way: north. So it wasn't surprising that thunderous applause by 10,000, 20-something IBMers met Big Blue chairman and CEO Sam J Palmisano's pitch about the limitless career opportunities in the world's largest computer services company for its people. Realising that a war for talent that will break out in India soon, Palmisano made sure that the young guns figured that working for large corporations like IBM would not mean a ‘lost in the sea' experience but one that promises a rewarding career.

Palmisano, who seemed rather moved to have met so many of his young employees at the city's Palace Grounds, later even joked, “Some had got up really early, at 4 am, to be able to make it on time to the event. We gave them both breakfast and lunch. I think they really came for that and not for me!”

But there is nothing funny about IBM's gameplan for India and its young and vibrant workforce. IBM, which doesn't want to be called an MNC anymore and is strongly positioning itself as a ‘globally integrated enterprise', saw its chairman paint a vibrant picture about the diversity of the corporation and multiple business lines which give its employees numerous opportunities. “We invest $5 billion in R&D and had five Nobel prize winners,” he added. The testimony of the growth of IBM in India has also been very evident with it emerging as the highest MNC IT exporter as well as the largest MNC player in the domestic market.

The ‘Innovation and Leadership Forum' was webcast across IBM's 170 global locations. Palmisano said IBM has always been in the forefront of innovation and has been in tune with the changing needs of the business.

He said IBM was in the leadership position during the PC business era and has transitioned to the same status in the networked economy. “We are a globally integrated company with tremendous skills and India has incredible capability,” he added. IBM, which has constantly been expounding its idea of innovation also honoured some of the innovative leaders such as Bharti Airtel chairman Sunil Bharti Mittal, Dr Ashok Jhunjhunwala of TeNeT, Byrraju Foundation — an education initiative for rural children, Tsunami relief effort by employees of IBM India and Dr Raghuram Krishnapuram for research accomplishments.

Karnataka chief minister HD Kumaraswamy, presented his IT credentials at the event by touting Bangalore advantages.