Indian IT services scene: Some future trends

Date:   Tuesday , September 04, 2007

Indian IT services scene today means many things to many people. While the Indian IT services companies continue to enjoy their current growth phase, analysts and the media dutifully predict the future by using the power at their disposal. The predictons range from rosy pictures of continual growth to a slow-down and stagnation. Some believe Indian IT companies’ future belongs to products, while some argue that the industry is going to face a major shortage of talent. Here are a few thoughts on the subject.

Talent crunch
* Corporate India seems to be obsessed with the notion that our country is going to run out of qualified, talented manpower.

This has two aspects: Gradual disappearance of the ‘cradle to grave’ employment syndrome that was prevalent throughout the past wherein people generally joined an organization to leave it only through natural retirement. This scenario has now changed drastically. Thus, there is a continuous movement of talent from one organization to another. Though this does not mean that the total number of employable manpower at any given moment gets reduced, the organization that loses an employee to another has at least a ‘transient’ shortage. This attrition is a big problem that has contributed to the scare in no small proportion.

* The other aspect, however, is more formidable. It is related to the concern over the feared gap between the need for qualified and employable manpower vis-à-vis the actual supply of qualified manpower. The premise here is that with a 1.2 billion strong population, there will not be a shortage of employable manpower. The following are the likely reasons:

* Eagerness and hard-working quotient of the general Indian youth.
* The fact that coding needs only an analytical ability to work with logic and basic graduates can be trained to learn and deliver.
* The oft-quoted Indian arithmetical ability passed on from generation to generation.
* The urge ingrained in the minds of millions of lower middle class youth to upgrade themselves and their readiness to go that extra mile to achieve this

Unconventional BPOs
I foresee one major trend that is poised to manifest itself in the near future: The emergence of focused, unconventional, yet unexplored BPOs.

The term BPO is currently a prisoner to the popular perception of the ubiquitous Call Centers. Just as these Call Centers came into being due to a new kind of global demand that was supported to a great deal by the rapid advances in technology particularly in the telecom sector, the new wave of BPOs will also be IT-enabled and will be pushed by the customers worldwide. Their growth will be fuelled by customers wanting unconventional services at the corporate as well as retail level. Though services like medical and legal transcriptions have an unconventional hue around them, the new wave will be much different and larger in scale, sophistication, and service levels.

The new BPO mega-trend will throw up services in fields such as engineering, procurement, maintenance, and data analysis; in fact, a basket filled with all sorts of outsourceable work at an optimized price. Needless to say, like the earlier phase, this new trend will also have IT as its starting point, but it will incorporate newer and more innovative IT applications to meet more interactive and customized demands of the customers.

Indian companies are moving towards software services offerings based on technology, domain, and processes frameworks rather than products. This framework is an abstract form consisting of a set of related applications in a particular domain for describing a set of concepts, methods, and technologies.

Indian companies are developing such frameworks as they offer productivity gains, consistency, repeatability, predictability, and a reduced time to market to software services providers and clients alike.

With these frameworks, software services providers can demonstrate their knowledge of the domain and technology areas, differentiate themselves, break the linear relationship between resources required and the revenue from these resources and remain competitive.