By Kenan Machado & Arvind Sukumar, CNBC-TV18

Indian IT companies have been gunning for acquisitions of consulting companies in a bid to move up the value chain. However, such buys are fraught with huge risks.

Infosys, Wipro, Satyam or TCS all want a piece of the consulting pie. That is because Indian companies want to use their inhouse consultancy capabilities to acquire more outsourcing business.

This is how it works: a Technology Consultant typically convinces the client to offshore a process like systems maintenance or billing. Once the Consultant completes the project, the company can also pitch for multi-million dollar outsourcing business.

So, in the last six years, Indian IT majors have acquired close to five consulting companies for about USD 100 million. Even though the consultancy business may garner higher profits, the challenges of acquisitions still persist

Paul Hermelin, CEO, Capgemini Group, said, “You must be ready to pay a senior guy USD 5,00,000 to USD 1 million. Now, how can you have in the same company juniors that you just hired from a campus in Pune. In terms of culture, people must respect each other."

That respect, consultants themselves say, is difficult to come by. Especially when employees shift from a small consultancy shop to a large-work force driven IT company.

Milan sheth, Partner-Business Advisory Services, E&Y said “From a consultant's perspective, who always had freedom and who liked making a direct impact to the client, as part of a larger organisation, that visibility may not be for them personally. Hence, many people do leave those organisations because then they are just one in a large organization.”

The desire to get into consulting is also driven by the desire of Indian IT companies to get into the big leagues of IBM, Accenture and Capgemini.

But consulting globally still contribute less that 5% of the revenues of the large Indian IT companies.

Industry watchers say, this fact means Indian IT still has a long way to go before it makes it to the big league.