• By quade
• 3 July 2024

Infosys BPO Wants to Combine Its Services to Revive Growth

Infosys Ltd currently stands as India’s second-largest information technology (IT) company. However, growth has not been as strong for Infosys. To try and correct this trend, the company is looking for new ways to spur innovation and growth. One of their plans is to fold up one of their subsidies, Infosys BPO back into their services.

This subsidy has shown great promise but has struggled to grow, providing an opportunity to inject cash into the larger company. They believe that this can help innovate the IT wing as it allows them to offer more services to customers. 

What Does This Mean for Infosys BPO?

One anonymous executive says that the current Infosys BPO sales team numbers around 100 employees. With this combination, these workers will be expected to help their IT counterparts with projects. Meanwhile, the delivery services will continue as normal. This will lead to better coordination between the teams and allow them to provide more services. 

“So, the way it will work is that many of the service offerings of the BPO can work across all service lines,” 

-Anonymous Exectuvie in Infosys BPO

This may be done in an attempt to catch up with other competitors such as Tata Consultancy Services Ltd and Wipro Ltd which have already consolidated their services together. 

But better late than never and chief executive officer Vishal Sikka, says that Infosys BPO is already beginning to turn things around as the company posted an impressive 9.1% growth in dollar terms (13.3% in constant currency) in March.

However, while the company as a whole is doing well, certain subsidiaries underperformed and their revenue only grew by a paltry 0.93%. This merging of Infosys BPO and the IT sector can help further growth as at its height, the BPO services have been one of the company’s top performers but now struggles to keep up with rivals.

Can This Revive the Infosys BPO Service?

“Will this be enough? It depends on how it is structured. Will Infosys BPO sales executives own clients or will they work along with IT services arm? For now, it is not clear how Infosys will align its BPO sales team with IT services. Things will become clearer in coming weeks”.

-Anonymous Sales Executive.

The core issue with Infosys BPO is the company’s inability to continue scaling the business by getting more business with its current clients. Today, the company only gets 38% of its business from its largest clients, a drop from a decade ago.  At the same time, the company has already been dropping its prices to recruit new clients, further damaging its profitability.

Their operating profits have already decreased from 18.7% to 18.1% in the last decade, showing the company is on shaky grounds.