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Rivals woo Satyam clients, staff: Forrester

Source: PTI
January 09, 2009 15:11 IST
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Over half a dozen rivals of the tainted IT firm Satyam Computer have started exploring ways to take over the business from its various clients, a global technology consultancy firm said on Friday.

Satyam is likely to see its clients as well as employees deserting it soon due to the competitive wooing by rivals and top IT firms like Infosys would continue to shore up their market share, analysts at Forrester Research said in a report.

"Large and small clients alike will look to other suppliers they already work with as an immediate fallback position as the confusion continues. More than half a dozen providers have already called Forrester to discuss competitive strategies for taking over business in joint accounts," it added.

"Both clients and employees will desert Satyam as a result of competitive wooing. In our interactions with several of Satyam's employees across the organisation they showed utter frustration," Forrester Research's VP and principal  analyst John McCarthy and its Senior Analyst in India Sudin Apte said in the report.

"Many employees told Forrester that it's too early to comment, but they will weigh their options almost on a daily basis," they added.

Forrester noted that Satyam's employees and clients face a period of prolonged uncertainty and rumours amid no clear visibility into availability of working capital and cash-on-hand with the fraud running into hundreds of millions of dollars.

The analysts also pointed out that the Satyam fiasco would lead to Indian offshore providers, which are either family-owned or part of large industry conglomerates, facing more financial scrutiny.

"With these smaller firms facing the brunt of this extra checking, top Indian providers like Infosys will continue to take market share," they stated.

Further, the unprecedented event would leave most Indian vendors having to explain their governance and accounting integrity, it added.

Forrester further said that sourcing and IT executives need to actively review their exposure to Satyam and their options as a cloud of uncertainty hangs over the company.

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