Indian IT is seen as a leader in the global race to build skills around automation technologies and domain- specific expertise. Automation has existed for as long as the industry has and is a natural progression of search for efficiencies. It started off in the form of automation of specific areas like testing, remote infrastructure monitoring, or claims processing, and has now reached a stage where bots can takeover low -value tasks without need for human intervention. Automation has resulted in an improvement in average revenue-per-employee from $15,000 to $56,000 between 2008 and 2018 as it allows resources to take on higher value tasks that require subject matter expertise in technology or vertical specific processes. Digital is another journey in search of even better value propositions, said Hansa Iyengar, a senior analyst at London-based consulting firm Ovum, in an interview with Mini Tejaswi. Excerpts:
How do you view the status of Indian IT industry?
There’s no doubt that the Indian IT industry is currently facing headwinds, which threaten the growth prospects. Shifting spending patterns, tightening visa regulations, geo-political uncertainties and internal metamorphoses are all posing major hurdles for a sector that has seen its margins getting thin and growth peter out over the past few years. But it’s just another phase in the evolution of the industry and it will bounce back like it has done before. This phase is temporary – it’s a time for reflection, realignment and regrouping.
What are new customer expectations and demands from IT providers?
Services using new technologies like artificial intelligence and machine learning, IoT, analytics and UX (user experience) design form the core of enterprise demand around digital services. It requires vendor to work directly and closely with clients, provide consulting around business processes and technology roadmaps, which are different from what vendors are used to doing. The current business environment is forcing Indian IT to recalibrate strategies and go-to-market approaches. Resource-based efficiencies are being replaced by efficiencies of automation, demand for IT is being driven by need for value rather than need to lower costs and traditional lift-and-shift work is being replaced by higher value work that requires a different set of skills.
What kind of investments are bing made in digital?
Clients are making serious investments in digital. But they are reluctant to spend large amounts on untested technologies and want vendors to invest in pilots and trials to get an idea of capabilities before scaling up – and this requires vendors to put more skin in the game. These are areas that are relatively new to Indian vendors and require them to build new capabilities, partnerships and engagement models as well as reinvigorate their talent pool. This takes time.
Indian tech players are vying for a sizeable share in digital engagements. What’s the future outlook for digital?
We are witnessing an evolution of Indian IT. Portfolios have been realigned to address client’s digital agendas, acquisitions are being made to bolster capabilities, and the industry is investing in re-skilling nearly 50 per cent of its talent to reorient them towards digital services.