Genpact SWOT and PESTLE Analysis

Strength

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Weakness

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Opportunity

1. Rising prominence of Enterprise Mobility Management solutions: Companies across the world are increasingly adopting Enterprise Mobility Management (EMM) solutions due to the rising trend of Bring Your Own Device (BYOD). The growth of mobile devices for business usage is also driving the demand for EMM solutions. The EMM market is expected to grow at a CAGR of 12.84% during 2019-2024. The largest market so far is North America but Asia-Pacific is the fastest growing market. In North America, USA accounts for 80% of the market and the high demand is driven by high rate of mobility adoption in various sectors like banking, healthcare, retail etc. Genpact acquired Endeavor Technologies in 2015 to enhance its existing mobility solution capabilities that are built upon the Lean Digital and SEP frameworks.

2. Strategic acquisitions for augmenting capabilities: Genpact continues to enhance solution capabilities through strategic acquisitions and investments in chosen service lines and industries where the company has domain knowledge. This has helped the company in acceleration of digital transformation engagements. For instance, the company acquired Rightpoint in 2019 for enhancing its capabilities of providing digital transformation solutions in the experience economy. This builds on Genpact’s acquisition of TandemSeven in 2017. To enhance supply chain solution capabilities, Genpact acquired Barkawi Management Consultants in 2018. In 2015, the acquisition of Endeavor Technologies helped the company enhance capabilities in mobility solutions.

3. Digital transformation initiatives across industries: Digital transformation helps organizations in improving their brand’s reputation, customer experience, and customer retention ratios through the implementation of the software. The overall digital transformation market globally is forecasted to be in excess of $650 billion by 2023. Companies are building a robust infrastructure due to increased demand, and there is increased adoption of new technologies and solutions, further supporting the market growth. Due to growing competition within the industries, investments in technology are further increased to gain a competitive edge in the market. Genpact with a strong digitals transformation portfolio and expertise, is well positioned to leverage the market potential.

Threat

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Political

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Economic

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Social

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Technological

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Legal

1. Intellectual property development during the course of business: Solutions provided by Genpact to clients have many proprietary software and methodologies. Genpact also develops intellectual property during the course of business. The company’s agreements with clients govern the IP ownership rights. Genpact protects its intellectual property through various means like applications for service marks, patents, copyrights, trademarks and domain names. Some of the IP rights are trade secrets related to enhancing business processes. Genpact also uses platforms of the clients and third parties during service delivery. The company’s agreements with clients include licenses to use client proprietary platforms for service delivery. Clients also authorize third party software used by them for Genpact’s use in providing services. The company enters into agreements with independent contractors and employees for ensuring all new IP developed by contractors or employees during the period of employment is assigned to Genpact, and also for ensuring cooperation of contractors and employees in IP protection even after they leave the company.

2. Impact of laws and legislations of Bermuda: Genpact is a Bermuda company which makes it subject to regulation in Bermuda. Payment of dividends is regulated by the Companies Act 1981 of Bermuda. The company is classified as a non-resident of Bermuda for exchange control matters by the Bermuda Monetary Authority and the company can transact in currencies other than Bermuda dollars. There is no restriction on transfer of funds in and out of Bermuda or payment of dividends to US shareholders. Genpact also comes under ‘exempted’ companies, which are companies formed to conduct business outside Bermuda. The exempted status bars Genpact from certain business transactions like those involving Bermuda landholding rights, without a license from the Minister of Finance.

3. Evolving data privacy laws across the world: The rising concern about data privacy has resulted in governments around the world coming up with stricter laws governing data privacy. In the EU, the GDPR came into effect from May 2018. Fines for GDPR non-compliance can be as high as 4% of the annual revenue. Even other countries are coming up with stricter laws. Countries in Latin America and Asia are considering implementation of laws similar to GDPR. In November 2018, Canada has put into effect a new law for mandatory breach reporting and record keeping. India is also coming up with strict laws governing use of personal information. Compliance with all these laws is difficult and incurs lot of expenditure. Failure to comply also will be detrimental to Genpact’s operations and financials. To ensure compliance, Genpact provides training to employees and contractors about privacy obligations. Genpact has also appointed a Data Protection Officer as per the GDPR mandate.

Environmental

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