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SWOT Analysis of TCS

Tata Consultancy Services (TCS) is India's largest IT services company and part of the Tata Group. It has a large global presence across industries like banking, retail, and telecom. TCS generates over $16 billion in annual revenue. Its strengths include a diverse client base and geographic footprint. However, weaknesses include legal battles that hurt its reputation and underperformance of subsidiaries. Opportunities exist in digital transformation, cloud computing, machine-to-machine solutions, and enterprise mobility. Threats are rising costs from immigration restrictions, intense competition, and high employee attrition rates.

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252 views

SWOT Analysis of TCS

Tata Consultancy Services (TCS) is India's largest IT services company and part of the Tata Group. It has a large global presence across industries like banking, retail, and telecom. TCS generates over $16 billion in annual revenue. Its strengths include a diverse client base and geographic footprint. However, weaknesses include legal battles that hurt its reputation and underperformance of subsidiaries. Opportunities exist in digital transformation, cloud computing, machine-to-machine solutions, and enterprise mobility. Threats are rising costs from immigration restrictions, intense competition, and high employee attrition rates.

Uploaded by

simran
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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SWOT Analysis of

TCS
March 7, 2019 By Hitesh Bhasin Tagged
With: SWOT articles

Tata Consultancy Services (TCS) is the


subsidiary of the reputed Tata Group. TCS
is involved in providing IT services,
consultancy and business solutions. TCS
has operations in Asia-Pacific, Africa, Middle East, Europe and Americas. TCS generated
revenue of $ 16596 million in FY 2016, with a growth of 14.8% year-on-year.

Table of Contents

Strength in the SWOT Analysis of TCS :


Clients from diversified markets: TCS has clients from diversified industries such as Banking,
financial services, retail, telecom and media and entertainment etc. Exposure to diversified
business industries dilutes business risks of overdependence on a single market or industry.

Geographic Footprint: TCS has strategically expanded to geographically diversified markets


throughout the globe which includes North America, the UK, Middle East Europe, Africa and
Asia-Pacific. Presence in geographically diversified markets reduces business risks and creates a
strong global image for TCS.

Strategically established partnership network: TCS has established the strong partnership
with global companies around the world. It has partnered with some technology giants such as
Adobe, Amazon, Bosch, Dell and HP etc. These partnerships allow TCS to deliver
technologically sustainable and innovative business as well as strategic solutions.

Strong portfolio of services offered: TCS has a strong and balanced portfolio of offered
services which includes, Business process services (BPS) application development and
maintenance, IT infrastructure, business intelligence and much more. Such a strong and diverse
portfolio attracts various business clients.
Weaknesses in the SWOT Analysis of TCS :
Legal battles: In 2014, TCS was involved in a legal battle against Epic Systems for alleged
misuse of Epic System’s confidential information. In 2016, TCS was found guilty and was
ordered to pay damages worth $940 million. TCS has opposed the judgment and challenging it to
the higher jurisdiction. Such incidents affect the image of the company.

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Decline in performance by Diligent: Diligenta, a subsidiary of TCS has continuously


performed below par. The company is not expected to improve on performance soon and thus
affects TCS’s bottom-line.

Opportunities in the SWOT Analysis of TCS :                      


Digital transformational technologies: The world is going digital and hence business dynamics
are also changing to the digital economy. TCS has focused on digitally transforming itself and
provide digital solutions. TCS should look ahead to spend more on digital transformation
technologies.

Cloud-based solutions: With the advent of digital transforming technologies and fast internet
connectivity. The world is moving towards cloud based solutions and as a matter of fact, the
spending on cloud services is expected to grow at a CAGR of over 19% in the next 5 years. TCS
has a solid infrastructure to provide cloud-based solutions and hence it is well poised to be
benefitted with the demand created.

Machine-to-Machine (M2M) solutions: M2M solutions are those which allow wireless as well
as wired communications systems. There is a positive outlook for M2M solutions in the future
and is expected to generate high revenues. TCS has a comprehensive suite of M2M services
which will enable to take advantage of the demand for M2M solutions.
Enterprise Mobility market: With increasing, mobile worker population and increased usage of
sophisticated mobile devices, enterprise mobility solutions are expected to be driven by business
applications. There is a latent demand for mobility solutions which is expected to grow at a
CAGR of 24.7% till 2022. With TCS’ increasing focus on developing enterprise mobility
solutions, it is well positioned to benefit.

Threats in the SWOT Analysis of TCS :


Immigration restrictions: With stricter immigration laws, increased H-1B visa fees and
changing political circumstances in the US, Indian IT companies are expected to suffer from it as
it will increase its costs and impact profitability and hence this is a threat to the industry.

Intense competition: The IT industry is subjected to intense competition from companies such
as Wipro, Infosys, Accenture, Capgemini and Deloitte etc. This leads to pricing wars in the
industry and limits market share.

High attrition rate: The Indian IT industry is subjected to high attrition rate which increases
cost in providing skills and leadership development to new hires and also impacts the image of
the company.

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