Risk management is an essential function at Wipro. This article highlights the important risks that the company faces and the measures that it is taking to mitigate these risks.
Wipro,
one of the most admired IT companies in India was
founded in the year 1945 by Mohamed Hussain Hasham
Premji. Under the leadership of Azim Premji leadership,
the fledgling Rs. 70 mn company in hydrogenated cooking
fats has grown to $736 mn (FY 2002) diversified,
integrated corporation in services, technology products
and consumer products. Ranked 7th among the software
services companies in the world by BusinessWeek (Infotech
100, November 2002), it serves over 300 global leaders
including Boeing, Nationwide, Ericsson, Toshiba, Cisco,
Seagate, Putnam Investments, United Technologies, Best
Buy, Digital, Friends Provident, IBM, Microsoft, NCR,
Thames Water, Transco and Sony. Wipro currently has 17
software development centers in India, one each in the
US & UK and 9 manufacturing facilities for IT and
non-IT products. It has 15 marketing offices in six
countries for Global IT business.
The
market for IT Services is highly competitive. Wipro's
competitors include software companies, large
international accounting firms and their consulting
affiliates, systems consulting and integration firms,
other technology companies and in-house information
services departments of clients. Many of Wipro's
competitors are much bigger and have significantly
greater financial, technical and marketing resources
compared to Wipro. Wipro's ability to compete depends on
the price at which competitors offer comparable
services, and the extent of the competitors'
responsiveness to their clients' needs.
Approximately
59% of Wipro's total operating expenses in the Global IT
Services and Products business, particularly personnel
and facilities, are fixed in advance, for any given
quarter. As a result, unanticipated variations in the
number and timing of projects or employee utilization
rates may cause significant variations in operating
results in any particular quarter. |
