EDS' Dave Colburn: We know GM well.
Tata and other Indian companies are grabbing consulting services and information technology work that traditionally has been the turf of EDS and other U.S. companies, such as Accenture and IBM Corp.
General Motors' 10-year contract with EDS expires June 6, 2006, and the automaker is inviting vendors to compete with EDS for that business.
EDS isn't going to lose its foothold without a fight.
Colburn spoke with Staff Reporter Ralph Kisiel about how EDS plans to compete with India's young rivals.
Is EDS concerned about losing some GM business to Indian companies?
I don't think that would be the element here. What company doesn't have GM in its crosshairs as GM goes out for re-compete? And, quite frankly, in a way, to their credit, GM is turning over every stone.
What are the Indian companies doing here?
They can be cost-competitive, and, quite frankly, that's how they've driven the wedge into the market, purely on price, purely on a body-shop-type approach: throw more bodies at it at a cheap rate to get in.
But when it comes to the value-add component that really is of prime importance to a lot of the players in our end of the business, it isn't always there.
What in particular are Indian companies good at?
They are project-oriented shops that are good on the short term but really have a limited breadth or limited footprint.
They are good at software applications, very specific but very narrow in their approach.
Are they taking on EDS in the area of consulting?
They've invested a fair amount of additional dollars to bring consulting activity to the Detroit marketplace. But pure penetration into this business, I would say, is limited at best. Most of the players here in Detroit have a global point of view, have an enterprise point of view, and a lot of the firms like Wipro, Infosys and Tata have a very limited bandwidth.
They don't have the global footprints that many of the corporations have, corporations like EDS, IBM or HP.
Is there risk in moving information technology work offshore?
That would have to be part of their evaluation process. I think there is risk in that, the complexity of a global player - take GM as a case. We know them well. There is risk in providing pure offshore.
We provide them offshore in multiple areas, but we're providing them the best opportunity in a particular geography. If you only have one location, there are lots of liabilities, so they have to weigh what those liabilities are. EDS is really the only one that offers 32 best-shore locations, from which we deliver a variety of key components.
What do you mean by "best-shore"?
Best-shore can really be framed in the context of it's on every shore, on every corner of the globe. It gives our client base 24/7-type information technology services.
You may e-mail Ralph Kisiel at [email protected]