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March 20, 2002 | Financial Express

Tata Tea focuses on outsourcing, hires Accenture for SCM revamp


Tata Tea has hired international consultancy firm Accenture to streamline its supply chain
processes. In a related move, the company has also embarked upon a outsourcing business
model to bring down the processing costs within the company.

Tata Tea’s deputy managing director Percy Signaporia told The Financial Express soon after
announcing its foray into the lowest priced segment of the domestic packaged tea market with the
launch of a new brand Agni Sholay.

Commissioned a month ago, the consultancy has been assigned to formulate a strategy to help
the company track sales through an analysis of stock movements and accordingly enable an
effective forecasting and inventory control.

"The aim is to create deliverable processes in our logistics and seamlessly integrate it with
strategic inventory management, credit control and sales generation," Mr Signaporia said.

According to Mr Signaporia the first phased report will come in the next six months and will be
implemented nationally for the company.

The company may also put in place an Enterprise Resource Planning Solutions and eventually
create a converging action plan to integrate marketing strategies.

In line with that initiative, Tata Tea has—for the first time—adopted an outsourcing business
model ala local players. As per the strategy, Tata Tea is sourcing tea across auction centres
despite having its own tea plantations, and packaging it under its own brand name. For its newly
launched brand Agni Sholay, for instance, the company has joined hands with a Calcutta based
company for procuring and packaging tea. "The idea is to procure locally, and distribute locally to
cut down the logistics costs," Tata Tea’s vice president Mr Girish K Tyagi said.

"Normally, for a brand with a potential of three digit turnover we would have required huge
investments to hire new facilities and manpower resources. But, we haven’t hired a single
person," Mr Signaporia added. According to him, the exercise should result in a saving of about
10-15 per cent of the company’s gross processing costs. Giving reasons, Mr Tyagi said that the
company has begun outsourcing despite having its own tea plantations, mainly because in recent
times tea prices at the auction centres have fallen to rock bottom levels. "Cost of production is not
recognised in an auction," he said.

As a result the lowest end of the economy segment is currently being flooded with all types of
branded teas and at all prices and encouraged by the profit margins of branded tea markets local
players have started selling their unblended teas in sloppy packets under obscure brand names.
Tata Tea to outsource herbal tea manufacturing in US
Monday, February 02, 2009 6:57:19 PM by IANS ( Leave a comment )

Kolkata, Feb 2 (IANS) Tata Tea Ltd will outsource manufacturing of Good Earth, its
herbal tea brand in the US, to an existing joint venture in that country to save “over $1
million” (about Rs.5 crore) annually, a top company official said here Monday.”We have
decided to opt for an outsourced model within the US as the yearly savings that would
accrue to us would be anything over $1 million,” Tata Tea managing director Percy
Siganporia told reporters at a press conference.

Siganporia, however, did not indicate from when such savings would get reflected in the
company’s financial results.

Tata Tea has acquired the Good Earth brand from Good Earth Corp, apart from several
other buyouts in the US.

Good Earth, which is manufactured at Tata Tea’s own facilities in the US, will now be
produced by Southern Tea, an existing 50:50 joint venture the Indian company has with
Harris Freeman, an American importer and distributor of spices, tea and coffee.

Southern Tea currently manufactures Britain’s tea brand Tetley for the US market.

Tata Tea employees at Good Earth’s manufacturing unit will be shifted to Southern Tea.

Good Earth’s current scale of manufacturing in the US is “miniscule” and does not
support the costs associated with it, Siganporia said, without mentioning the current scale
of Good Earth’s manufacturing facility.

Tata Tea is also planning to restructure its management set-up in the US that takes care of
operations of tea wholesaler FMali Herb Inc, Eight-O-Clock Coffee Co, and a plantation
at Plant City in Florida apart from the Tetley and Good Earth brands, he said.

FMali belongs to Tata Tea US subsidiary Tetley US Holdings, while Eight-O-Clock


Coffee belongs to another subsidiary, Tata Coffee.

“We plan to consolidate our management set-up in the US under a unified command as
this will eliminate large chunks of administrative costs,” Siganporia said.

More at : Tata Tea to outsource herbal tea manufacturing in US


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India October 10, 2008, 7:36AM EST text size: TT
India's Tata Wins Big Citi Outsourcing Deal
TCS acquires Citigroup Global Services—and bags a giant
contract to provide outsourcing services to Citi for the next
nine-and-a-half years

By Nandini Lakshman

It's festival time in India, and Tata Consultancy Services, the country's largest IT software
and services provider, is celebrating with gusto. After months of speculation, TCS
acquired Citigroup's (C) India-based outsourcing unit, Citigroup Global Services, for
$505 million in an all-cash deal announced on Oct. 8. That's the largest-ever purchase for
TCS. What's more, the company bagged a $2.5 billion contract to provide process
outsourcing services, application development, and infrastructure support to Citigroup
and its affiliates over nine-and-a-half years. "This transaction will complement our
domain expertise and bring new capabilities to TCS that will help drive growth," says S.
Ramadorai, chief executive officer of TCS.

At a time when stock prices of India's outsourcing powers are crumbling (BusinessWeek,
10/2/08) amid fears of a deep global recession, the TCS deal shows executives are
nonetheless confident Indian software service providers will remain competitive in tough
times. The Citi contract is the biggest win ever for an Indian company. TCS edged out
contenders such as IBM (IBM) and French IT company Capgemini, and the promise of
steady business from the deal encourages some analysts. "The revenue visibility in the
TCS contract is a big plus in this tumultuous market," says Abhiram Elaswarupu, IT
analyst at BNP Paribas in Mumbai.

The Citi deal helps TCS go up against its big foreign competitors directly. Unlike IBM,
Accenture and EDS, all big players in India, homegrown companies typically have
operated with smaller-scale deals, lasting two to three years and worth $50 million to
$200 million. Just last October, TCS had crossed the $1 billion threshold
(BusinessWeek.com, 10/18/07) when it signed a 10-year, $1.2 billion contract with Dutch
group Nielsen, which owns ratings major ACNielsen.

Expanding Exposure

Acquiring Citi's unit brings 12,000 new employees into the TCS fold and is expected to
generate revenues of $280 million this year. Currently, TCS, which has over 10,000
employees in its outsourcing units across the world, makes more than $150 million
providing services to Citi alone.

TCS has been providing IT services to Citi since 1992, catering to the bank's operations
in North America, Europe, India, Singapore, and the rest of Asia Pacific. As with most
big Indian software providers, banking and financial services form a big chunk of TCS's
business, accounting for 43% of revenues. The new outsourcing contract will nudge it a
percentage point ahead, says a TCS manager.

With the world's financial industry in turmoil, this isn't the best time for an Indian
outsourcer to be expanding its exposure to the sector. However, analysts say they are
more concerned about TCS overpaying to acquire Citiglobal. TCS should have negotiated
a better deal, given the fall in company valuations that has accompanied market
meltdowns around the globe, they say.

Tata Consultancy wins outsourcing deal from Telenor


BS Reporter / Mumbai June 16, 2010, 13:41 IST

Tata Consultancy Services Ltd, India's top software services exporter, said on Wednesday it had signed a
multi-year outsourcing contract with Norway's Telenor. Financial terms of the contract were not disclosed.

The contract comprises application maintenance and development services and will involve a modernisation
of Telenor’s Norway’s application portfolio across its OSS, fixed, mobile, datawarehouse and accounting
system domains.

BSE Price

The telecom business unit is the second largest vertical for TCS, comprising over 12,000 employees
working for over 160 telecom clients worldwide.

“This contract marks an important milestone for the IT industry in Norway and signifies the acceptance of
global service delivery in Norway. We expect this deal to serve as a catalyst for other Norwegian
organisations who are currently evaluating the use of Global Service Delivery,” said Tom Olsen, Head of TPI
Norway.

With this contract Telenor Norway will improve its operational efficiency, refresh its IT stack and will become
more agile to respond to its customers changing needs. "By implementing this measure we are making the
necessary adaptations to provide our customers with improved and more innovative services in relation to
capacity, speed and stability, as well as better quality in both voice and data, and to facilitate current
demands for accessibility," said Ragnar Kårhus, CEO of Telenor Norway.

“Our selection by Telenor to drive this modernisation demonstrates the headway we have been making in
the Nordic market and highlights our strong telecom domain expertise,” said A S Lakshminarayanan, Vice
President and Head of TCS, Europe. Telenor said earlier on Wednesday the telecom firm was reducing the
number of technology providers considerably.

December 09, 2003 | Financial Express

Tata Steel payroll outsourcing process to cut costs by 20%

As part of its outsourcing plans, Tata Iron and Steel Company Ltd (Tata Steel) plans to outsource its payroll
processing project in February-March, 2004.

To oversee this pilot project, the company is likely to rope in Prolease India, which is a human resources
(HR) solutions provider. The project will help Tata Steel reduce about 20 per cent of its present cost on
payroll processing, which the company currently executes on its own.

According to company sources, this is in line with the company's plans to focus more on steel making, and
to restructure and outsource non-core areas. "The project will be able to handle all payroll processing work
and the current 300-odd employees of Tata Steel, who do this work, will be given the opportunity to either
work in the new project or will be relocated in accordance with their capabilities," the source added.

Jamshedpur Utility & Services Ltd (Jusco), a wholly-owned subsidiary of Tata Steel, which is looking at
taking over the company's non-core activities in a phased manner, is examining the possibility of looking at
town management activities like basic maintenance, electricity supply to Jamshedpur and also other
townships in the near future.

According to Tata Steel officials, the company is said to have put aside roughly around Rs400 crore for its
ongoing sustenance programme, which will help in the further reduction of operational costs, and also
provide world class non-steel functions. The company is looking at further reduction in its manpower by
about 2,500-3,500 every year. Tisco has a workforce of roughly 40,000-42,000 people.

A Tata Steel official said that other pilot projects for the outsourcing programme are fleet management,
guest houses, education services, healthcare, etc.

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