Japan’s largest IT services company, the $ 9-billion NTT Data Corporation, wants to be among the top five IT services vendors in the world. It is currently at number 13. The company has drawn out aggressive plans to grow into this elite group that would mean going beyond its core Japanese markets and increasing revenues in US and Europe markets. Organic growth in the company and acquisitions in Asia, US and Europe is the road ahead for it.
Top on the global list is IBM and NTT recognises that one of the reasons for IBM?s high operating margins is the global delivery of IT services and presence of massive teams in lower cost countries like in India. With shortage of skilled engineers in Japan, NTT is hoping to expand its team in India by growing its JV and through acquisitions.
NTT entered India by picking 68.7% stake in Vertex Software, Pune that is now a NTT Data group company. Vertex has now been integrated into NTT. Vertex was a company promoted by four College of Engineering Pune engineers and first generation entrepreneurs – Nitin Datar, Ashok Kalluraya, Ajay Patil and Ajit Patil. A new facility of Vertex Software opened in Pune as part of the plans to grow the team in India. Shinichi Yamada, CTO of NTT Data, said the company that was till now offshoring and outsourcing to China, would now grow the Indian operations from 250 to 1,000. “Vertex will play an important role in our expansion as they cannot only do outsourcing work from Japan but also work with US and European companies,” Yamada said.
Yamada said the company was planning acquisitions and had set aside substantial amount for M&A activities. Instead of just being a systems integrator, NTT wants to be into software and IT services also, Yamada said. The company is promoting offshore development with a target of 100 billion Yen in overseas sales in two years time, which is a five-fold increase, Yamada said.