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Competitive Edge: Technology helps Indian IT industry stay ahead in the global market

May 24, 2016
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The IT industry comprises IT-enabled services (ITes), business process management (BPM), software products and engineering services. It has led the economic transformation of India and has been instrumental in altering the global perception of the country.

A key reason for the exceptionally good performance of the Indian IT industry is cost competitiveness of IT services in the country. The cost of these services in India is three to four times lower than the US. While this has been the unique selling proposition of the Indian IT industry for the past few decades, it is also beginning to gain prominence in terms of intellectual capital, with several global IT firms setting up their innovation centres in the country. The cost competitiveness of services in the Indian IT industry has sustained because of internal efficiencies that ITes enterprises have achieved by deploying a high-functioning IT and telecom infrastructure set-up.

IT and telecom are at the core of ITes or BPM enterprises, without which they cannot function. Since IT is their backbone, it is imperative for such enterprises to stay updated about the latest technologies in the market and deploy them to stay competitive.

A look at the key technology trends in the ITes and BPM industry…

Employee collaboration

Employees are the biggest strength of a BPM or an ITes enterprise, and effective utilisation of human resources is one of its key focus areas. Most of these enterprises have set up large collaboration platforms that enable real-time communication among employees. Moreover, the sector has seen a rapid uptake of the bring-your-own-device (BYOD) strategy. As a result, maintaining a remote and mobile workforce has become easier. This has also strengthened the need for smooth and efficient employee collaboration platforms so that employees based out of different cities can seamlessly collaborate on projects and assignments. With BYOD gaining traction, smartphones have become the first screen of access for communication among employees or between employees and customers. Therefore, enterprises are putting in place a robust and reliable enterprise mobility strategy so that communication is not disrupted.

Knowledge management

ITes and BPM enterprises generate huge amounts of knowledge in their day-to-day functioning. This content is relevant not only in the current time period but also serves as a point of reference for future projects that an enterprise might take up. Cataloguing and storing such information is a priority for an enterprise in this industry. This entails the deployment of knowledge management platforms within an enterprise.

Knowledge management helps in the faster resolution of issues, increasing employee productivity, and reducing dependence on onsite resources. Moreover, it enables quality improvement and reduces rework thus bringing down the turnaround time. Together, these enhance the ability of an enterprise to serve the customers more effectively and at a lower cost. This leads to productivity leaps within the enterprise.

Virtualisation and cloud

According to the International Data Corporation, the overall economic impact of server virtualisation in India is expected to reach $3.89 billion by 2020. Meanwhile, Gartner reports that virtualisation in India has already surpassed 50 per cent of all server workloads, and it will reach 86 per cent in 2016. The Indian IT industry is driving the move towards virtualisation, with ITes and BPM enterprises having virtualisation levels of over 70 per cent. IT enterprises have already successfully deployed desktop virtualisation and are now seeking to gain benefits such as full data backup, extended hardware life cycles, security, compliance and anytime-anywhere access.

Meanwhile, the introduction of cloud computing has provided a huge opportunity to IT companies, both in terms of platform-as-a-service and infrastructure-as-a-service. The pay per use or subscription-based cloud computing model is a lucrative option for enterprises that are looking to bring down the total cost of infrastructure, lower risk and promote innovation. Cloud not only helps manage the infrastructure cost, but also enables firms to collaborate freely across geographies. Firms are able to access the information that they need as and when required. Moreover, real-time changes and updates are immediately made available on cloud-based networks. In addition, cloud provides a reliable, secure and flexible option to enterprises that have stayed away from implementing traditional enterprise mobility management solutions so far and helps them manage their mobile workforce.

However, concerns around the security of cloud solutions hamper their uptake. Industry experts are of the view that as more and more enterprises in the industry turn towards cloud, these concerns will end and cloud adoption will rise rapidly.

Mobile applications and social networking

Another key area in which ITes and BPM enterprises are increasingly spending from their IT budget is enterprise applications. Enterprises create their own applications to maintain control on their brand, meet compliance needs, improve employee communication, manage customer relationships, provide helpdesk services, track expenses, monitor company sales, etc. Most enterprises have developed such applications to meet their daily business needs. However, with the rise of a mobile workforce, the need for better collaboration and availability of content on the go is increasing and enterprises are beginning to migrate their applications on to the mobile platform. Since smartphones and tablets are the primary modes of communication, it only makes sense to enable the critical applications for daily business processes on the mobile platform so that the workforce can easily access them. The enterprises have also enabled new ways of working for transforming current business processes.

In fact, this trend is being witnessed across industry verticals. Gartner projects that by 2017, 25 per cent of enterprises will have an enterprise application store for managing corporate-sanctioned applications on desktops and mobile devices.

Apart from enterprise applications, firms are spending on promoting the use of social media for effective communication. The success of social media in the consumer world has prompted some enterprises to develop enterprise-specific social media platforms that let employees communicate more freely. Other prominent technologies being leveraged by the BPM and ITes industry include business analytics software and process automation software. These technologies are helping companies improve their internal efficiencies and lower the costs that are passed on to clients.

Challenges and the road ahead

ITes and BPM companies are reinventing themselves to be able to continually deliver value to their customers. However, as customers respond to changing market dynamics, ITes companies will come under increasing pressure to function more as partners in their clients’ businesses than as vendors. For this, it is essential that enterprises leverage the technology at hand to simplify their internal processes and reduce the costs that are passed on to the clients. Moreover, being abreast with the latest technological developments can help them maintain a competitive edge and capture a larger market share.

However, integrating and aligning technology components with business needs and processes is becoming an increasingly complex task. Therefore, it is essential that enterprises carefully choose their IT strategy and invest in technologies only after a careful study of its applicability in their business processes. In addition, they must be aware of the fact that a technology will provide benefits only when it is adopted by an enterprise. As such, the implementation of technology should go hand in hand with creating awareness among the workforce and among clients.

Going forward, the Indian IT industry is likely to see continued growth. As per the National Association of Software and Services Companies, the Indian IT sector is expected to reach $350 billion in terms of revenue terms 2024-25. This is indicative of the huge potential and opportunities that exist in this domain. To tap these opportunities, enterprises will have to gain a competitive edge through new technology.

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