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Wipro manufactures the products it designs for customers

Customers like Cisco want Wipro to do both product development and manufacturing

Indian outsourcers have been typically known to develop enterprise software or offer IT services. But India's third largest outsourcer, Wipro, is taking advantage of having once designed and manufactured its own PCs and servers, to design and manufacture hardware products for customers.

The program meets customers' requirements for a total package that includes product architecture and design, embedded software, mechanicals, application software, testing, and taking the prototype into production, said Vasudevan Aghoramoorthy, vice president for semiconductor and systems in the Wipro Technologies division of Wipro. The design and intellectual property of the product belong to the customer, he added.

The company calls this offering the Collaborative Design, Manufacturing & Sustenance (CDMS) program. While it is 2 years old, Wipro only now has publicly disclosed details of the program during Aghoramoorthy's interview with IDG News Service.

Wipro does not do the manufacture but has arrangements with manufacturing companies in India and abroad, Aghoramoorthy said. It also supports the products in the field, he added.

The strategy makes good business sense, and could translate into cost savings for customers who want to design and manufacture a product for emerging markets, or are planning to introduce niche products with small production runs, said Karthik Ananth, director of market expansion at Zinnov Management Consulting.

Customers typically approach Wipro with a concept or a definition of a market need, a set of features that they would like in the product, and specify the price point at which they would like it delivered to the market, Aghoramoorthy said. The products typically have small production volumes. "We do not expect someone to approach us to design and manufacture a mobile phone, for example," he added.

Some of the customers are startups but others are large companies that want products built to address niche markets. The market may to be too small and niche for a large company to address on its own and invest in managing a supply chain, Ananth said.

Among the products Wipro has developed are high-performance computing platforms, networking products and a wireless unit with analog and digital inputs for tracking field parameters and relaying the information to servers.

Having the product design company coordinate the manufacturing helps, because the designer can keep in mind the capabilities of the manufacturer and what is available in the supplier ecosystem while designing the product, Ananth said. The time to market comes down significantly as a result, he added.

Among Indian outsourcers, Wipro is the only company that promotes this service as a differentiator, Ananth said. Others outsourcers sometimes contract to handle the design and manufacture of products, but on a case-by-case basis, rather than as a business focus, he added.

Cisco Systems for example outsourced the development of a networking product to Wipro and decided to have Wipro work on the manufacturing as well, because they were involved in the hardware design, said Mahesh Raghava, director of product management, service provider business, at Cisco's Indian operation.

Wipro is involved in new product development as well as enhancements of existing products for Cisco, Raghava said.

Wipro also developed a data acquisition and communications system called i-Sense for Invendis Technologies India, a telematics and telemetry company in Bangalore. The product has already been deployed in a number of countries including France, South Africa and Turkey, said Satish Kulkarni, the company's co-founder and CEO.

"We were developing products in-house before we decided to move all our hardware product development to Wipro," Kulkarni said. The company however continues to develop its software products in-house.

Invendis decided to get Wipro to handle the manufacturing as well, because it didn't want to manage two entities. When a design house takes up the responsibility of manufacturing and warranty of the product it has designed, one can be sure about the consistency of the quality at all stages of the life cycle of the product, Kulkarni said.

John Ribeiro covers outsourcing and general technology breaking news from India for The IDG News Service. Follow John on Twitter at @Johnribeiro. John's e-mail address is john_ribeiro@idg.com


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