New Delhi: An innocuous statement in a press release by Wipro Ltd sheds some light on how the Bengaluru-based company managed to win its largest information technology (IT) outsourcing contract, valued at $1.6 billion over 10 years, from Alight Solutions LLC, the former benefits administration and human-resources outsourcing business of Aon Plc. “FCM Consulting facilitated the transaction between the two organizations,” reads the last line of the press release dated 20 July, shared after Wipro and Alight announced a long-term “strategic partnership”.
FCM Consulting is a privately held firm, which Mitchell Habib founded in 2014, after spending 25 years at General Electric Co., Citigroup Inc. and Nielsen Holdings Plc. FCM, like other advisory or sourcing firms like ISG or HfS Research, helps Fortune 500 companies select the right IT vendor to offer solutions to help companies run their business better.
Significantly, it underscores how relationships, like in any facet of life, work in IT outsourcing industry as Wipro’s chief executive officer (CEO) Abidali Neemuchwala found a friend in an executive, with whom his friendship has only strengthened over the last decade.
During the last decade, while Habib was in charge of selecting the IT vendor, each of the three companies awarded mega (more than $1 billion in value) outsourcing IT work to Mumbai-based Tata Consultancy Services Ltd (TCS).
Understandably, Habib, who rarely engages with the media, said in an interview last year that he has done more business with Natarajan Chandrasekaran when he was CEO of TCS.
“Chandra and I have done more than $4 billion in business in over a decade we have known (each other),” Habib said January last year, a few days after Chandrasekaran was named chairman of Tata Sons Ltd.
Neemuchwala and Habib’s friendship started when TCS in 2008 won a $2.5 billion over nine-and-a-half years from Citigroup. Then, Habib was chief information officer of Citigroup’s North American Consumer business while Neemuchwala was the head of back office services (BPS) business of TCS.
An email sent to Habib and Wipro seeking comment went unanswered.
“Both Abid and Mitch share an excellent rapport,” said an executive from Wipro, on condition of anonymity. “Advisory firms like FCM, based on solution offering of a company, help bring clarity when a client is evaluating more than one vendor.”
How Wipro CEO’s friend helped win the Alight Solutions contract
Neemuchwala steered the team at TCS’s BPS division for seven years before he quit the Mumbai-based firm to take up the role of chief operating officer at Wipro in 2015.
At Wipro, the entire work, right from assembling the team before a formal request for proposal was submitted and then following up with executives at Alight was led by Neemuchwala, according to two company executives.
To be sure, Wipro’s own solution offerings and its acquisition of cloud services firm Appirio Inc. helped the company as much. Industry executives claim that Appirio has one of the strongest Salesforce practice, which only helped Wipro edge past rivals as the work at Alight required a better software to manage customer data (CRM or customer-relationship management software).
“A company wants to be sure that there will not be any issues in work when it is awarding a mega deal of this size. So, when someone has worked with a leader, who is now the CEO of a company for long, there is confidence in the company and it helps,” said the second executive of Wipro.
“It’s a great time to be an analyst or consultant,” said Phil Fersht, CEO of US-based HfS Research, an outsourcing-research company. “Deals are becoming more complex. There is a lot more trust, business strategy and change management being included in these relationships now than ever before,” said Fersht.
“We are seeing true digital transformation deals turning out to be larger than traditional outsourcing deals,” said Akshay Khanna, a Delhi-based partner with US-based advisory firm Avasant. “These deals require stitching together multiple emerging technologies, innovative operating models, and partnership-oriented service providers.”