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Wipro seeks bigger digital market share with "commando" unit

MUMBAI (Reuters) - India's third-largest IT services exporter Wipro WIPR.NS is setting up a "commando force" unit next month that will target clients seeking to speed up automation and do more business online, an executive told Reuters.

People walk in the Wipro campus in Bangalore June 23, 2009. REUTERS/Punit Paranjpe/Files

Rajan Kohli, who will head the newly formed Wipro Digital business, said the unit aimed to generate $1 billion in annual revenue within three years, which would make it one of the company’s top sources of revenue.

“We believe there is a lot of opportunity and a lot of money that our clients can save and that we can make,” Kohli, the former head of Wipro’s financial services unit, said in a telephone interview from the company’s Bengaluru headquarters.

After decades of low-margin work including server maintenance, India’s $150 billion IT services industry is looking towards artificial intelligence, cloud solutions and other more sophisticated digital services for growth.

Industry advisory Offshore Insights estimates automation and artificial intelligence work will grow to 25 to 30 percent of India’s IT outsourcing market by 2020 from less than 5 percent now. The entire sector is expected to double in value to $300 billion by then, the national industry association says.

Wipro's digital unit follows similar shift in focus towards digitisation by larger rivals Tata Consultancy Services TCS.NS and Infosys Ltd INFY.NS.

Kohli said the unit aimed to have the look and feel of a Silicon Valley start-up, from a relaxed dress code for employees to faster service for clients. The number of employees will also be lower than in more traditional units.

“This unit is like a commando force. You don’t need an army for this,” he said. Initially, most hires come from start-ups and select technology units of bigger firms, he added.

Indian IT services firms have typically hired large numbers of new graduates to show clients they have enough employees to finish projects quickly. By contrast, global tech firms such as Google Inc hire far fewer people, but usually pay better.

Kohli said the unit’s staff would be based in places including New York, London, San Francisco, as well as headquarters, because clients often prefer proximity.

“It is an environment where clients need outcome in 4-6 weeks. Traditionally you need 6 weeks to provide people,” he said. “In the digital world, people don’t work in silos.”

Editing by Miral Fahmy