Indian consulting firms invade France

By Edward Haigh

A year ago I asked an Indian systems integrator if they were planning to target the French market where organisations were in deep cost cutting mode.  “Too hard,” was the response: leaving aside the usual barriers to doing business in France (have you been to the right école?), French businesses were thought to be culturally inclined against IT outsourcing and strict labour laws precluded most of the potential savings.

How things change!  An article in Les Echos a week or so ago drew attention to the speed with which Indian firms are moving up the ranks of French suppliers, in revenue terms at least.  This is partly as a result of acquisition (TCS bought Alti this time last year), but an increasingly global outlook among France’s biggest companies and of course the price differential have been important factors, too.

Perhaps the Indian firms have two advantages.  The first is technology: our research into the perceptions of French clients suggests that technology consulting firms have something of an advantage at the moment.  Clients, eager to keep costs under control while finding new sources of growth, see technology as a key part of the solution, whether that’s enhancing their existing ERP system or leveraging new, digital technologies.  This creates a halo effect in which consulting firms closely associated with technology benefit.  But there could be a second, far more specific reason behind the Indian firms’ recent success.  Although many have had offices in France for some years, they’ve not been particularly visible or well-known: they’re still, to many potential French clients, the new kid on the block – and an unknown quantity.  Our client perceptions research suggests that people who haven’t hired and closely worked with these firms have relatively low expectations about the quality of work they do.  Once they’ve worked with them they’re pleasantly surprised, sometimes dramatically so (one firm saw a 20% jump in terms of perceived quality).

That doesn’t mean the Indian firms can afford to relax.  Some of that jump will be real – a recognition that they have been investing and are anxious to make a positive mark on clients – but some of it comes precisely because they’re new.  Familiarity , we’ve seen in other markets, certainly breeds contempt in consulting: the Indian firms will have to demonstrate they’re not just exploiting an appetite for change.