Question
Can someone share their thoughts about writing below thanks.......... 1. Threats Competitors- Infosys decided to get into the IT consulting market. Unfortunately with todays technology,
Can someone share their thoughts about writing below thanks.......... 1. Threats Competitors- Infosys decided to get into the IT consulting market. Unfortunately with todays technology, there are over hundreds of thousands of firms. The big industry companies consisted of names such as IBM Global Services, Boston, Consulting, Accenture, and more. This group made up only 25% of industry revenues. For Infosys to try and get large client accounts they would first have to get on the level of these more established companies. This would help them have a more competitive advantage. Tax code changes- under the Software Technology Parks of India (STPI) IT companies were able to benefit from not paying corporate income tax for up to 10 years. Once this expired they would be losing a lot of money. In 2008 Infosys received STP-related tax discounts of $282 million. H-1B Visa- This allows companies to bring foreign workers to the U.S. to do work. In the past it was a lot easier to just hire foreign workers but now with constant changes, it was making it harder to do so. Due to concerns it has caused companies to lay off employees and even withdrawing offers made to MBA students graduating from U.S. business schools who were not U.S. citizens. Another problem was also foreign students coming to the U.S. to study and after receiving a degree they would return back to their original country. They are pretty much using our resources to then leave and be competitors. 2. The specific issues Adrian is dealing with at the end of the case is wondering how to handle the increased competition, and how would the company handle the recent Indian and U.S. tax code changes. She was also worrying about the H-1B visa reform, unsure of what direction it would go. This is the external part. As for the internal part she worried whether they should maybe have the IT consulting department under a different company or name and also wondered about maybe they should relocate to Ireland to take advantage of lower corporate tax rates. 3. The important of each is that they will directly or indirectly affect how the company moves forward with its IT consulting department. It will also help them determine which way is best when wanting to hire employees, whether to stick with U.S. or to continue getting foreign workers. All of these choices will greatly affect how much revenue they make or don't make as well. 4. They tie into my answers in the first point because it is explaining practically what a lot of companies are having to deal with especially Infosys. In order to fix all these problems the first part is to address it which Adrian has done. These threats are the same issues her company is facing and thats why they are working on a solution to solve it. These problems are causing loss of revenue and loss of workforce to Infosys and that is how they go hand and hand with each other.
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