sloppysid/faiss_search huggingface dataset:
TATA CONSULTANCY SERVICES LTD. — 2023-01-11
Tata Consultancy Services Q3 FY23 Earnings Conference Call January 9, 2023, 19:00 hrs IST (08:30 hrs US ET) One of the largest asset managers in the USA with over US$7 trillion in global assets, migrated its personnel advisory services and digital advice offerings to the cloud-based TCS BaNCS to its management platform, enhancing their advisor experiences, improving accuracy and low latency responses for performance configuration analytics for millions of customer portfolio of record numbers. Our Quartz blockchain platform have two new wins and one go live in Q3. A Swiss multinational pharma major has increased their adoption of Quartz further, building on the successful initial pilots we executed using blockchain, smart contracts and digital payments. Quartz smart solution for contract performance monitoring and Quartz Gateway are going to be used to eliminate inefficiency in cross-functional manual processes entailing procurement, finance and treasury. In Life Sciences, TCS ADD™, our Advanced Drug Development platform, enabled by artificial intelligence was implemented for two leading pharma companies for automation of adverse events intake and processing. With this, TCS ADD has successfully completed automated processing of half a million adverse event cases. Our offerings in this platform address patient centricity, smart clinical analytics, interoperability, and AI-enabled automation, that are emerging trends in the life sciences industry. TCS Optumera™, our artificial intelligence powered retail merchandising suite went live for four clients. TCS OmniStore™, our AI-powered universal commerce suite had two go lives. TCS HOBS™, our suite of products for communication services has one new win and four go lives in Q3. TCS iON had seven wins in the quarter ending December. During this period, we served over 35 assessment customers and administered exams for 8.8 million candidates. We reached a new industry partnership milestone in Q3, engaging with 1,580 corporates that leverage the TCS National Qualifier Test as their entry level recruitment platform. Over 3,700 candidates have gotten placed till-date. Lastly, MasterCraft™ and Jile™ had won 10 new clients in Q3 and 21 renewals. : Page 5 of 23
TATA CONSULTANCY SERVICES LTD. — 2023-01-11
Tata Consultancy Services Q3 FY23 Earnings Conference Call January 9, 2023, 19:00 hrs IST (08:30 hrs US ET) Let me now go over our client metrics. These metrics are an important validation of our customer-centric business model. In Q3, we added one more client year-on-year in the $100 million plus band, bringing the total to 59; 12 more clients in the $50 million plus band, bringing the total to 130; 35 more clients in the $20 million plus band, bringing the total to 290; 30 more clients in the $10 million plus band bringing the total to 456; 39 more clients in the $5 million plus band, bringing the total to 658 and 42 more clients in the $1 million plus band bringing the total to 1,217. Let me now request Rajesh to speak on the demand drivers. Rajesh Gopinathan: Thank you, NGS. As mentioned by NGS, the seasonality led to some moderation in growth in verticals like BFSI, Retail and Technology and Services and across all our key markets. While the seasonal aspect should reverse in the next quarter, the macroeconomic uncertainties are likely to result in a more balanced year in 2023 after two years of strong growth. For now we see a client caution translating into greater focus on cost optimization. We're seeing an increase in the number of large operating model transformation engagement. In the first three quarters of FY'23, we won 20 such deals versus 16 in the prior year same period. Our innovative approach to redesigning the operations and embedding AI and intelligent automation into individual processes using TCS Cognix™ has been delivering superior outcomes for our clients and differentiated positioning for TCS. We are also seeing an uptick in vendor consolidation. Our scale, full services capability and track record of delivering outsized savings through operating model transformation is helping us win such deals. We have won quite a few such deals across BFSI healthcare, manufacturing and telecom and we see many more in the pipeline. Here is a good illustration: The BT Group, UK's leading provider of fixed and mobile telecommunication, announced a new partnership with TCS for its digital unit to boost its modernization plans. TCS will manage and ramp down over 70% of digital legacy technology estate, and boost capacity to accelerate the build of its new strategic technology architecture, supporting the group's growth. : Page 6 of 23
TATA CONSULTANCY SERVICES LTD. — 2023-01-11
Tata Consultancy Services Q3 FY23 Earnings Conference Call January 9, 2023, 19:00 hrs IST (08:30 hrs US ET) Coming to cloud transformation, it continues to be a strong area of growth. As I had mentioned in the last quarter, clients are much more focused on execution of their cloud journeys and the increased intensity is translating into an expanded opportunity for us. Our strategic industry-specific solution fabrics built on market leading hyper scalar platforms accelerate enterprise digital transformation and drive exponential business value through industry innovation. We won several new cloud transformation deals in Q3. Here are a few examples. We were selected by Boston Scientific Corporation, a global medical devices company as a strategic partner for their purpose-led, enterprise-wide multi- cloud acceleration program. TCS' decade-long transformative partnership will help deliver cloud-native resilient and futuristic operations that will fuel Boston Scientific's global business growth and its mission of transforming lives through innovative medical solutions. TCS expanded its partnership with the UK headquartered international savings and investment firm to help them transform into a cloud-only organization by 2025, through a series of technology and business transformation initiatives. Leveraging its deep contextual knowledge of the client's IT and business landscape, TCS will help modernize and transform their application estate using cloud-native architecture, and seamlessly migrate them to a public cloud using TCS Cloud Counsel and TCS Migration Factory. This will also simplify the legacy infrastructure estate and facilitate their exit from on-premise data centers. We have been engaged by the largest online travel company to build a unified, modernized enterprise data platform, which entails creating a data lake abstracting data from transitional systems and other data sources and building intelligent self-learning engines leveraging AI/ML models and rendering seamless experiences to customers and associates. The marketing meta- analytics we deploy will enable greater personalization and tailored recommendations on their portal. Moving on to growth and transformation, we usually talk about G&T engagements focused on the front end, helping clients launch innovative new : Page 7 of 23
TATA CONSULTANCY SERVICES LTD. — 2023-01-11
Tata Consultancy Services Q3 FY23 Earnings Conference Call January 9, 2023, 19:00 hrs IST (08:30 hrs US ET) products and services or new technology-enabled business models or channel improvements and personalization that enhance customer experience. I'll come to those in a bit, but before that, I also wanted to share some examples of how technology-led innovation at the back-end can also result in revenue growth and improved customer satisfaction. Predictive analytics, machine learning and AI are fueling such innovation. Let me illustrate with three examples. PostNord, a European communications and logistics solution provider has partnered with TCS to achieve their `Win in Parcels’ key strategic priority and to be the market leader. Their key objective is to transport more parcels per truck in each trip made between the terminals and their regional hubs. TCS developed a touchless AI-based solution using machine vision and importantly, existing security CCTV cameras, to accurately measure the truck fill rate in real-time. It leverages a TCS proprietary algorithm to optimize the line haul planning and truck departures. This has helped improve the revenue yield per truck, reducing the number of trips and associated costs, and even the carbon footprint. TCS partnered a US headquartered multinational biopharmaceutical company in co-creating and implementing an industry-first AI-based solution to transform the handling of patient complaints about drug-device combination products, such as pre-filled injections and auto injectors. The solution triages complaints and automatically separates out product- related complaints from drug-related adverse events, resulting in faster processing of complaints, timely feedback to patients and to internal design and production teams for remediation. This has helped improve product quality, enhance patient experience and contributed to improved sales of such combination products. Toyota Material Handling in North America engaged TCS to transform its field service teams’ ability to diagnose and repair. TCS’ solution enables guided troubleshooting, self-service and cognitive search of technical product support content using AI/ML and NLP, which helps reduce downtime associated with unplanned maintenance by 10% to 15%. The transformation has improved first time right fix, reduced dealer overheads and resulted in service stickiness, : Page 8 of 23
TATA CONSULTANCY SERVICES LTD. — 2023-01-11
Tata Consultancy Services Q3 FY23 Earnings Conference Call January 9, 2023, 19:00 hrs IST (08:30 hrs US ET) leading to increased service part sales for dealers and to Toyota Material Handling. M&A continues to be a recurring theme in our customers T&T agenda. They have been entrusting us with these integration or divestiture mandates on account of our contextual knowledge of the business and IT landscapes, our highly collaborative inside-out approach to transformation, and proprietary accelerators such as TCS Crystallus™, a set of pre-configured industry and business solutions available on leading enterprise application platforms. Here are three examples: Philips Domestic Appliances, a carve-out from Royal Philips and a global leader in kitchen coffee, garment care and home care appliances, engaged TCS as a sole-sourced primary partner to support PDS’ transition to an independent entity, and its business transformation to become a digital-first and consumer-centric organization. TCS established a digital core for the new business, designed lean business processes and successfully rolled out the pilot in seven countries. We are now working towards a big bang go-live for the rest of the world. This is expected to be the foundation for a 10x growth in sales from expansion into new markets and channels, with 20 million highly engaged customers. Similarly, we are helping a leading North American bank with the seamless merger of a US bank. TCS' deep contextual knowledge and platform expertise was critical for success in this large and complex M&A program, involving online banking channels, treasury and payment services, auto and equipment financing, among others. TCS did an end-to-end mapping of the products and processes of the acquired bank and carried out a parity uplift to ensure consistent experience for incoming acquired bank customers. At the back end, we integrated new lending and leasing products into the acquirer bank's portfolio and migrated the acquired bank’s products, customers and users to the acquirer’s platforms. With the successful integration, the acquirer bank expanded into a large complementary contiguous market in the US, doubling its branch footprint and onboarded over 1.5 million new customers and inherited a strong commercial business with a high-quality loan portfolio. : Page 9 of 23
TATA CONSULTANCY SERVICES LTD. — 2023-01-11
Tata Consultancy Services Q3 FY23 Earnings Conference Call January 9, 2023, 19:00 hrs IST (08:30 hrs US ET) Finally, in Q3, we were chosen by European life and material sciences company to lead the global integration of one of the largest acquisitions. TCS is responsible for end-to-end integration of warehouses and factories. It will set up a transformation management office to enable faster realization of synergies, and serve as the foundation for future M&A. Let me now provide a few examples of TCS partnering with clients to use digital technologies to help launch innovative new products or services that drive new revenue streams. A leading US-headquartered media and technology multinational partnered with TCS for building a single digital ecosystem platform, spanning home entertainment and mobility. As the sole strategic partner, TCS was responsible for the full lifecycle of the new technology platform for this new line. TCS designed and implemented the solution through an API grid for the entire ecosystem leveraging AI/ML for agile operations, proactive care, proactive service management, and preventive fault management. The new business model helped deliver truly personalized and unique customer experiences to end-customers. It recently crossed 5 million customer connection and witnessed high NPS score and customer satisfaction ratings. TCS helped a leading US money transfer service provider transform its technology estate into modern cloud-powered platform, enabling it to launch new products faster, expand into new markets and strengthen its customer relationships. Leveraging the new integrated next-generation multi-currency digital wallet and digital banking platform, our clients have forayed into digital banking in Europe, offering customers access to a variety of differentiated multicurrency payment services in a single app. The new platform has also helped the client successfully integrate with cross-industry ecosystem partners to offer millions of customers greater ease, reliability and access to money movement, and payment service capabilities. Overall, the transformation has resulted in increased customer loyalty, reduced customer journey barriers and created new revenue streams. Similarly, in Q3, an APAC-based automotive electronics manufacturer chose TCS as their co-innovation partner in developing a next-gen instrument panel : Page 10 of 23
TATA CONSULTANCY SERVICES LTD. — 2023-01-11
Tata Consultancy Services Q3 FY23 Earnings Conference Call January 9, 2023, 19:00 hrs IST (08:30 hrs US ET) cluster. TCS services will span product development, HMI or Human Machine Interface, functional safety, cyber security and other cockpit related products. In prior calls, I have given examples of how TCS is participating in large industry transformation initiatives. In the Utilities sector, we have had several examples of TCS helping utilities or power producers navigate energy transition. Our domain expertise and track record in executing successful transformations is firmly establishing us as the preferred G&T partner in the sector. Here’s one more example of the same. Western Power, a leading Australian power generator and distributor, selected TCS for our credentials in this space to design, deliver and support a distribution system operator platform solution. Our solution enables the client to orchestrate Distributed Energy Resources or DERs, such as rooftop solar batteries and large appliances across homes and businesses into a virtual power plant, aggregating the excess electricity generated by their assets and then dispatching it into what will become new energy markets and services. TCS’ solution also addresses critical issues like low voltage network visibility and optimization. With over 650 participating customer energy assets till date, the platform has demonstrated the safety and reliability of aggregated DERs and helped the client model the complexity of bi-directional energy flows. This will open doors for Western Power to participate in the futuristic energy market and build new revenue streams while safely operating within the technical limits of the distribution grid. Likewise, we're participating in the longer-term transformation trends in the transportation sector. Last year, I had spoken about the work we're doing for Transport of London to transform the administration of taxis and private hire vehicles in London to prepare it for an electric and autonomous future. In Q3, we won a deal that will transform the railways sector in the UK. TCS was chosen by the Rail Delivery Group, UK's leading rail industry membership body for the creation of a rail data marketplace. TCS will leverage data syndication, monetization and marketplace features of its DeXAM platform and a leading hyper scalar cloud to combine fragmented sources of rail data into one digital service. : Page 11 of 23
TATA CONSULTANCY SERVICES LTD. — 2023-01-11
Tata Consultancy Services Q3 FY23 Earnings Conference Call January 9, 2023, 19:00 hrs IST (08:30 hrs US ET) This will optimize the sharing of data and real-time information to passengers and operational bodies, improving transparency and enable a UK-wide railway innovation ecosystem. Let me now come to the Q3 order book. Our deal closures in Q3 amounted to a TCV of $7.8 billion. By vertical, BFSI had a TCV of $2.5 billion while retail order book stood at $1.2 billion. The TCV of deal signed in North America stood at $4.2 billion. With that, we will open the line for questions. Moderator: Ladies and gentlemen, we will now begin the question-and-answer session. The first question comes from the line of Kumar Rakesh from BNP Paribas. Please go ahead. Kumar Rakesh: My first question was to better understand the headcount moderation during the quarter. During the press conference, Rajesh, you talked about the focus on headcount efficiency to continue in the fourth quarter as well. Assuming the headcount stay steady in 4Q, you will be exiting the year with a headcount growth of about 4% YoY. My question was, is that an indication of growth visibility that you have today and hence the rationalization or you are confident of driving similar or higher productivity gains, and hence revenue growth could be significantly higher than that? Rajesh Gopinathan: I think the best way to think about it is that on a year-on-year basis, our net headcount is higher. So, we have significantly invested in building up capacity from 2021, tried as much as possible to bypass the industry's hire-from-each- other attrition cycle, and focus on hiring at entry level, and invested in training and cross training our resources. That investment has hit our productive capacity and stood us in good stead. The incremental hiring for this year should be seen in context of what we've done in the last year also. Overall, we are very comfortable with where we are with our net headcount. We hired significantly ahead of revenue growth in '21 and balanced it with a more prudent hiring in calendar '22. Going forward, we should be back to a more normal kind of hiring trend. While specific numbers will keep evolving, we should expect hiring in the range of 125,000 to 150,000 for the year, offset by more normalized attrition levels closer to our long-term averages, which will give us sufficient capacity to take : Page 12 of 23
TATA CONSULTANCY SERVICES LTD. — 2023-01-11
Tata Consultancy Services Q3 FY23 Earnings Conference Call January 9, 2023, 19:00 hrs IST (08:30 hrs US ET) care of growth. And then we can keep bringing in shorter term hiring to take care of demand as it unfolds. So, that would be the best way to think about and model it. Kumar Rakesh: My second question was on the deal side. So, you talked about that cost optimization deals have already started picking up meaningfully. In the past, during recessions, we have noticed that first, there's a sharp cut to IT budget, before cost optimization deals starts picking up. I understand that visibility on client budgets is still a couple of months away. But do you think this time the transition from discretionary IT spending to cost optimization deals could be far smoother than what we have seen in earlier recession period? Rajesh Gopinathan: It's also a factor of how it is playing out in different markets. So, as I said, if we take a market like UK, that is well and truly into much more strategic long term, cost-based restructuring kind of deals. We're seeing multiple such ones play out and we're participating very strongly in that. Markets like US, we need to wait and watch how that will play in the next couple of quarters, but we are fairly constructive. Our conversations with customers are much more balanced ones where they are equally positive, as well as cautious and we should see a mix of both cost and transformation deals. In Europe, decision making is slow. So, it's very difficult to call it one way or the other. So, this is not some major single event that has happened globally. All three markets are moving to three different beats and each of them is indexed to their own specific outlooks. Moderator: Our next question is from the line of Vibhor Singhal from Nuvama Equities. Please go ahead. Vibhor Singhal: Rajesh, I just wanted to basically pick your brain on the performance of the retail segment in this quarter. This segment has outperformed the company average growth rate and also doing really very well. Globally, we are hearing about a lot of these retail chains, calling out weakness, especially in Europe in parts as well. So, any color on that would be helpful as to what drove this strong performance in this quarter, do you expect this to sustain in the coming quarters also? And also, is there some color to it in terms of let's say, US retail maybe doing slightly better than Europe retail, as you just called out that in Europe, the decision making is slow on an overall basis? : Page 13 of 23