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Infosys Takes Over Panaya

Infosys has acquired Panaya, a Hackensack, NJ based automation software maker for $200m. In a statement, the Indian IT services company cited that this acquisition will help them cut down on the manpower dedicated to repetitive tasks, as the cloud-based software will let Infosys automate tests to changes to customers’ enterprise resource planning systems. Panaya is used for testing software from providers like SAP, Oracle and Salesforce. Once the software is integrated Infosys will start automated testing.

Linear business models make IT firms incur sizeable labour costs for every new business, and hence, more and more companies are moving to non-linear models in order to arrest the recurring costs. The Indian companies, like Infosys, which have grown massively on the back of low-cost labour, are now investing greatly on technologies in order to change to the non-linear business model. IT and Business automation software allow them just that. “This will help amplify the potential of our people, freeing us from the drudgery of many repetitive tasks, so we may focus more on the important, strategic challenges faced by our clients,” Vishal Sikka, the CEO of Infosys,  said.

Automation software is still underused and even UK and US are in early adopter phases. Automated business processes help save back-office operational costs as well as the over-reliance on offshore recruitment. The acquisition of Panaya certainly gives Infosys crucial leverage, and what needs to be seen is how they use it to their advantage over their competitors.

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