Every industry is at an inflection point, disrupted by a nexus of forces and in that line, the IT industry is at a unique position. One, it has to solve the core industry’s problem by providing strategic technologies and at the same time evolve within to stay relevant in the marketplace.
While we have been talking about driving growth the non-linear way, but by and large the Indian IT services industry derives its revenues from traditional ADM services with one big vertical chipping in the revenues. So it is expected that in 2017, the IT industry will try and innovate to succeed in the marketplace.
We believe the IT industry in India will embrace the following 4 key trends in 2017.
INFUSING MORE NON-LINEARITY
So clearly the need of the hour is a completely new thinking to the new normal realities. In an earlier interview to DATAQUEST, we asked Capgemini India CEO Srinivas Kandula on how could Indian IT industry add more value. He observed, “ The time has come to drive non-linear growth. Whether we choose to follow this path or not, it is bound to happen. Non-linear growth will come in the form of replacing the current solutions, technologies, platforms and essentially the skillsets that are currently prevalent. Certainly, non-linear growth will add more value as people will be able to utilize their cerebral skills in a much more pronounced manner than they did in the past.”
Agrees Rajiv Srivastava, MD at HP Inc India, he said during our DQ Top survey that opportunities in India today offer possibilities of discontinuous growth Sometimes this growth is not obvious and you need to be innovative and take radical or bold initiatives to capitalize. Upsides are immense if they work out.
VERTICAL AND GEO DIVERSIFICATION
The time has come to deepen the market in LATAM and EMEA. It’s no brainer that Indian IT services are by and large polarized on one geography- one or two vertical play. While there is this so-called vertical spread, but the sunrise vertical is still BFSI, followed by others like manufacturing, healthcare, retail et al. Similarly, the US as part of the North America market takes the lion’s share obviously followed by Europe. But, BREXIT might dampen the fresh IT mandates in that part of the world.
In an interview with DATAQUEST, Mohit Joshi, President and Global Head of Financial Services, Infosys when posed with the question on whether Indian IT players have over dependence on BFSI and is it time to diversify their vertical play in terms of revenues said, “ The fact to be considered is that BFSI is the largest IT spender in the world, as they invest a lot in transformation, regulatory compliance etc.. Going by that, I see – Indian IT players are aligned to them. At Infosys, we are well diversified with the healthy mix of revenues from across the sectors. Within BFSI, we have different client segments like large banks, regional banks, investment banks, asset managers etc. and have a well-balanced portfolio. However, there are smaller service providers that need to diversify to hedge over-dependence on a client or a sector.”
“That said, the market and demand for IT in the BFSI sector is significantly large, providing ample opportunities for different players to grow. However, to succeed, service providers need to be differentiated in their approach to meet growing digital needs,” adds Mohit.
AI & AUTOMATION
From testing savants to intelligent bots, IT services companies are upping the ante on automation. What automation will usher in is that it will take over mundane and repetitive tasks. While this might have far-reaching consequences, but at the same time will bring in the much talked about non-linearity in the IT services space.
Conventional IT development practices are passé. Most services companies are expected to re-imagine their development teams and eliminate silos and hasten collaborative development practices. In that order, DevOps will further escalate and get entrenched in 2017 as leading software development hygiene practice.
Furthermore, one will also hear words like agility and continuous delivery more in 2017 as most services companies will create a blended IT model to stay relevant in the marketplace.