Electronic Data Systems (EDS) is acquiring RelQ Software Pvt. Ltd., a privately owned software testing company in Bangalore, India, to strengthen its global testing capabilities by offering applications testing, validation and verification, and quality assurance services.
RelQ's more than 700 employees in India, the UK., the US., and France are expected to become a part of EDS' global testing organization.
The financial terms of the transaction were not disclosed, but EDS said the transaction is expected to close in May.
EDS' interest in acquiring RelQ has been speculated on for almost a year now. A report in February in an Indian daily, The Times of India, put the acquisition price at $US40 million.
Focused primarily on the banking, financial services, telecom and consumer electronics industries, RelQ offers real-time and embedded applications testing, including mission critical software testing, for clients looking to deploy applications across the enterprise.
EDS last year acquired a majority stake in Indian outsourcer MphasiS BFL Ltd. The company is also merging its own Indian services subsidiary with MphasiS BFL through a stock swap.
A number of multinational services companies, including IBM are expanding their service delivery capabilities from India by acquiring local companies or foreign companies with large Indian services operations.
French IT services company Capgemini S.A. completed in February its acquisition of Kanbay International, an IT services firm, to boost its services delivery from India, and its business in the financial services sector.
Applications testing, validation and verification, and quality assurance services, are increasingly in demand.
Mauricio Daher, a principal consultant with the storage services provider GlassHouse Technologies, believes successful organizations have good software testing procedures in place.
Training, documentation, and standardization are the essential ingredients of process success. Falling short on the CMM (Capability and Maturity Model) scale typically has more to do with a lack of discipline than a shortage of skills, according to Daher.
"At one end [of the CMM scale], you might have some superstars who do a really good job of managing [the datacenter], and they're indispensable, but unfortunately they haven't documented fully, and if one of those guys gets hit by the proverbial bus, you're in trouble," Daher says.
"And the other extreme is a fully documented environment where everything is automated, and if something's not automated, there is a manual procedure in place that runs like clockwork."
While many large organizations choose to outsource, for those that keep testing inhouse, Daher said the key is to ensure internal standards are rigorous, well documented, and drilled into everyone in the organization.
"And those standards should extend all the way down to simple tasks such as configuring a switch and even to the naming conventions used for your zone sets," he added.
- with Doug Dineley