It is a much-overlooked benefit of its 2002 merger with Compaq, but Hewlett-Packard’s substantial Indian IT services presence owes much to a beachhead established in the late 1990s by Compaq’s earlier acquisition target of Digital Equipment.

By the time HP arrived on the IT services scene, Digital’s services wing had already built up a workforce in India (under the majority-owned GlobalSoft) of 4,600.

That has given HP Services some pedigree. “Two-thirds of our staff have been there for over three years,” says the Campbell Robertson, managed services director for HP in UK. That kind of longevity is rare in an industry where around one in five staff change jobs every year.

HP’s output from India is focused around two centres – in Bangalore and Chennai – providing foundation services (such as IT helpdesk), managed technology solutions and business continuity. Of its 20,000 employees in India, 14,000 are involved in application development and support.

Like most of its peers, HP does not support the attitude that India is merely a conduit to a budget workforce. Not only is the cost-advantage becoming diluted, but the company believes that only by tightly integrating Indian operations into the HP organisation as a whole can it compete successfully for the world’s largest companies’ business.

“Customers need to know that that the same services they receive in Brazil are available in France. Our approach to global delivery is standardised: there is a consistent method, wherever the service is being delivered from and delivered to,” says Robertson.

HP’s ability to support businesses all around the world is self-evident, he adds. Of the customers that HP’s Indian division services 35% are in America, 30% in EMEA and 32% in Asia Pacific.

Like other Western IT services companies, HP Services has now built enough scale in India to give it both credibility and the opportunity to raise its operating margins (margins already jumped from 7.4% to 9.6% last year, primarily due to lower costs of service delivery). Around 30% of its global workforce is now based in the sub-continent.

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