Wachovia -Wells Fargo deal will it impact Genpact ?
SOURCE: SIFY
DATE: Oct 29th, 2008
Mohit Soapbox:
It will be interesting to see how this plays out with Genpact and other IT service providers for Wachovia. Wachovia is also working with a number of IT players for outsourcing including Infosys, Cognizant and Accenture.
There are also a handful of niche service providers which Wachovia uses including Zenta, Synechron. Genpact which has supposedly set up a virtual captive with Wachovia has always looked at Wachovia as their
key anchor client. A challenge for some of these vendors for sure
The Wells Fargo-Wachovia merger process is likely to result in a loss of at least a couple of hundreds of jobs in India, sources said.
Wachovia, a leading player in the financial services sector offering a broad range of retail banking, brokerage, asset and wealth management, and corporate and investment banking products and services, was recently acquired by Wells Fargo, another leading US-based financial services company.
Wachovia, like many other US companies, has been using Indian human resources for outsourcing its work on various platforms.
According to sources, it has been using the services of at least three outsourcing players for some of its key processing jobs. While Genpact provides the account processing for the company, Chennai-based Zenta Knowledge Processing Services provides customer management services including underwriting and mortgage services.
While the total number of Indian ITeS professionals deployed on Wachovia’s operations is said to be over 1,000, Genpact has been offering its services using about 250 professionals.
Wells Fargo itself has a strong team of professionals for captive use in Hyderabad.
“While companies like Zenta have been into KPO services, the jobs of people on regular account processing would be put on the chopping board only to divert the work to the already established Wells Fargo facility,” the source explained.
Though Genpact is said to be still negotiating for retaining the contract with Wachovia, Wells Fargo would be keen on making full use of the capacities it has in its facility.
Wells Fargo has about 650 people in its facility and the company insiders say that the capacities still remain under-utilised.
“It makes more business sense to make use of the available resources to achieve better return on investment than continue to outsource even when the captive facility has surplus capacities,” the source said.
Sources in Genpact, however, said that the jobs of about 250 professionals still hang in balance as far as continuing the deal with Wachovia is concerned.
While the officials of Genpact were not available for a comment, Wells Fargo officials felt that it would be premature to comment on any future changes. “It’s too early to tell. We have only recently announced the definitive merger agreement and there’s lots of work to be done,” a Wells Fargo spokesperson informed DNA Money in response to a questionnaire.
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“The integration process is going on within the organisation and there are many aspects of merger, which will unfold in due course of time,” she said.
Wells Fargo’s India operations are based out of Hyderabad and the teams in Hyderabad work as the extension of the teams in the US.
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