HCL, TCS, Wipro up in engineering services ranking

BENGALURU: HCL, TCS and Wipro have all risen one rank up in HFS Research’s latest list of the world’s top engineering service providers. European players continue to dominate this space. The ranking has 27 European firms and 9 Indian firms in the top 50. French companies Altran and Alten led the ranking, the two registering revenues of $2.6 billion and $2.2 billion respectively.Nine players have over $1 billion in revenue from engineering services — including Altran, Alten, AVL, HCL, Akka, TCS, Wipro, Accenture, and Bertrandt. HCL Tech is now in the 4th spot with a revenue of $1.68 billion from engineering services. TCS with $1.25 billion is in the 6th spot, while Wipro with $1.2 billion in the 7th spot.Engineering services has been a bright spot in the overall outsourcing business in recent years. IT industry body Nasscom said that in 2017, Indian engineering services exports grew by 13%, much higher than the growth in IT services exports, at 6%, and BPM exports, at 8%. Cognizant, Infosys, and Tech Mahindra have over $700 million in revenues coming from this space.Aricent (acquired by Altran last year), L&T Tech, Cyient, Quest Global Persistent Systems, Tata Elxsi, Mindtree, Happiest Minds, and Sasken are other prominent Indiabased players in engineering services.Product engineering refers to the process of designing and developing a device, assembly, or system. A lot of such engineering is now outsourced to specialised players. HFS Research SVP and managing director Pareekh Jain said there is a reason to the European dominance in outsourced product-engineering services. “Product-engineering is a core business activity for enterprises which many were unwilling to outsource in the early days of outsourcing, unlike transactional IT Services and BPO services which are not core activities and can be better managed by experts. Product manufacturers’ ‘secret sauce’ that has kept them competitive has traditionally been their internal design and make capability,” he said.Jain said the outsourcing trend started with Airbus, which wanted to accelerate its product development to compete with Boeing and started leveraging local outsourcing partners to access their expertise. This led to the scaling up of the French engineering outsourcing industry. Similarly, the German automotive firms started outsourcing to local outsourcing partners to accelerate product development to compete with US and Japanese automotive companies.

from The Economic Times https://ift.tt/2BCRSkZ