Targeting 'Asymmetrics of Motivation'

The markets are vibrant, the software exports industry is hungry and all companies with the possible exception of the hugely successful TCS and Cognizant are in quest of a new formula for growth. At this stage in the industrys evolution, where a third wave of growth could be enabled by one or more of many new trendscloud computing, platform, information security, etc, it may be worth going back to management theory and map potential strategies for growth, for all players in the outsourcing business.

One model that readily comes to mind is the outstanding work done by innovation guru Clayton Christiansen of the Harvard Business School. Christiansen had suggested 3 strategies for both new and established companies seeking to enter a new phase of growthsustaining strategy of offering better products to existing customers and markets, low-end disruption offering incumbent customers a good enough product at lower prices, and a disruptive strategy to address non-consumers with simple convenient products that deliver value.

For our industry, all 3 are viable and attractive optionsthe first is the conventional approach that most of the successful firms have followed and the third, while attractive, is fraught with risks and only a few like Google and iFlex have demonstrated that brand new models of success are possible. Who remembers the hundreds who have bravely chosen the road less traveled and collapsed on the wayside? Today if you look at any company beyond the top 5, the opportunity is to exploit what Christiansen calls the asymmetries of motivation. Asymmetries exist in all industries, where firms see an opportunity to make a mark in a segment, which the incumbents find either too complacent or too expensive to fight over. Software and infrastructure as a service, micro-verticals which have future scalability and emerging technology opportunities should give hope to small and medium players that if they choose the right battlefields, they can still see significant success.

Of course, there is many a slip between the strategy cup and the implementation lip since this is one industry where large incumbents are capable and willing to make a play for every sliver of opportunity in their chosen market segments. It will need careful evaluation and choice of the opportunity area, and a well-orchestrated confluence of all the elements to succeed in any disruptive strategy, whether of the low-end or new consumer variety. What works for one company may not do for another since segment, size, and scale are all determinants of future success. Each company needs to introspect, evaluate market opportunities, and define its own strategy for growth and success in this new phase of industry growth.