• Investment World
• eWorld
• Brand Line
• Mentor
• Life
• Brand Quest
• The New Manager
• BL Club
• Smartbuy
• Books
• Gallery

Stocks

• Quotes
• SE Diary
• Scoreboard
• Open-End Mutual Fund

Cross Currency

• Rates
  
  

Shipping

• Ports
  
  

Archives

• Yesterday
• Datewise
• Resources
• In Focus
• In Depth
• Events 2007

Group Sites

• The Hindu
• The Hindu ePaper
• Business Line
• Business Line ePaper
• Sportstar
• Frontline
• The Hindu eBooks
• The Hindu Images

Infosys innovating in slowdown era.

Our Bureau

Bangalore, Sept. 6

Infosys Technologies said its new engagement models, wherein customers are charged on either pay-by-use basis, outcome generated or on the number of transactions, are finding greater acceptance with clients.

“The pace of acceptance has gone way beyond what we had thought, which is encouraging,” Mr Subash Dhar, Senior Vice-President and Executive Council Member, told Business Line recently.

The order bookings on the new pricing or engagement models at the end of June quarter had already exceeded the previous year’s billing, Mr Dhar said without disclosing details.

Currently, Infosys earns a very small portion of its revenues from the newer pricing models. A major chunk of Infosys’ earnings are billed on the traditional time and material (T&M) basis, where customers are billed on the number of hours put in by the employees on a particular project.

Over the next three years, Infosys expects up to a tenth of its revenues to come from such newer pricing models, Mr Dhar said.

Infosys, which has made significant investments in developing the new pricing models, is aggressively pushing them across the markets.

“Every business unit of Infosys is being incentivised, told, tracked and helped to make it big. We are taking it into the market. It is a top strategy of the company to push these models and it is there high on the agenda,” Mr Dhar said.

In the past nine months, Infosys has won 14 deals on the new pricing models. “Deals have been very small and modest in size. If we can get one of the big deals on the models, it would mean a huge change,” Mr Dhar said adding that clients have started asking for alternative pricing models in their RFPs (request for proposals).

Stating that both new and existing customers were equally interested in Infosys’ newer pricing models, Mr Dhar said newer customers, who are starting off with smaller engagements, are finding it easy to adopt them. The global economic crisis has forced customers to go slow or holdback their investments on deploying new technology applications. As a result, growth for Indian IT vendors has come under a check in the past few quarters.

Mr Dhar said the newer pricing models would help address the needs of clients, who have increasingly turned cost-sensitive. Customers are outsourcing short-term projects that generate quick returns.

While stating the company was confident of assessing the risks associated with the newer pricing models, Mr Dhar said the company has picked-up projects where predictability of work is higher such as maintaining large applications among others.

More Stories on : Software | Business Models | Infosys Technologies Ltd

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Copyright © 2009, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line