Indian software keeps Swiss securities safe

Switzerland makes up for a shortage of IT professionals by using experts based in India swissinfo.ch

Every time you take a train in Switzerland or use a phone or a credit card, the chances are high that software developed in India is involved somewhere along the line.

The software business is the most thriving sector of the Indian economy and Swiss companies have not been slow in outsourcing their work to Indian experts.

The partner of choice for many Swiss companies including UBS, Credit Suisse, Swisscom and the Federal Railways has been the Indian software company, Tata Consultancy Services (TCS), part of the gigantic Tata conglomerate.

The Swiss securities market – one of the most important in the world, handling a large volume of cross-border and internal trade – is another satisfied customer.

“Back in 1990, we had to build a new system from scratch,” said Ronny Vogt, head of marketing for securities clearer, SIS Segaintersettle.

“We asked for offers from a US company, two Swiss companies and an Indian company. We knew it was an extensive job, we knew it would take 300-400 man-years of development time and when we finally got the offer, we found that the Indian offer was by far the best.

“It was an excellent offer in terms of cost, time and quality. We met our partners in India several times before we accepted the offer. They had already built up a reputation here in Switzerland.”

Swiss Fort Knox

Globally, SIS Segaintersettle keeps over 60,000 securities in safe custody in more than 43 markets. Its operating facility at Olten, dubbed Switzerland’s Fort Knox, handled 14.5 million Swiss transactions last year and it is sitting on top of securities worth over SFr2 trillion.

TCS developed an electronic clearing and settlement system called SECOM which is regarded as one of the most modern, secure and cost-efficient systems in the world. The project, which took three years to complete, cost about SFr100 million.

“Three years to build such a system was an ambitious target,” said Vogt. “In the last ten years, we have invested more than 700 man years of time into developing the system and adding new parts to it.”

The cooperation continues today. About 40 Indian software engineers are collaborating with SIS specialists in Switzerland with another 130 working in India.

“We invest SFr30-40 million in new development each year and most of it is still handled in close cooperation with our Indian partners,” said Vogt.

About 18 months ago, the team won a contract from the Global Straight Through Processing Association (GSTPA) to create a system to speed up and simplify crossborder transactions.

A positive shock

“Before 1990 we were restricted to domestic services, we did not have too many people speaking English or have many contacts to other cultures so it was quite a shock for us – a very positive shock.

“In the meantime, our Indian colleagues are very well integrated into the whole company and our people from Switzerland enjoy the cooperation as well.”

TKS Teknosoft is a Swiss company, based in Zurich, which represents Tata Consultancy Services.

Chief Executive Officer, Jakob Schmid, says countries like Switzerland can make up for a shortfall of IT professionals without poaching thousands of experts from India. Instead, Indian experts can do the job from home.

“It’s a heavy brain drain when western companies recruit specialists educated in India. But if the engineers stay employees of TCS in India, not only is there no brain drain but any further know-how they acquire here, they can use elsewhere to help the Indian economy later on.”

by Vincent Landon