The State of Business!



Its back to business for this magazine after the four-part DQ Top 20 series and back to business too for the IT Industry, which seems to have new heart murmurs by the day–the US threats against both the H1 and the L1 visas, the agitation against movement of jobs offshore and countries in Europe making job displacements in IT and BPO more and more difficult–there is never a dull moment.

“When it comes to maintaining the offshore wave, both American and Indian companies are pulling in the same direction”

Ganesh
Natarajan

What is interesting to note is that when it comes to maintaining the offshore wave, both American and Indian companies are pulling in the same direction. The American corporate sector clearly recognizes that moving more and more “context” jobs to India is the best way to move cost out of the profit and loss accounts, and while there may be some reluctance to openly support the reduction of visas, there is no shortage of vocal support for the right to move work to any part of the world.

On a recent trip to the US, I was greatly encouraged by the clarity that many of our clients and prospects had in their own thinking that a sustained move towards an Indian back office was the only way to go. In fact, the emergence of some fine program management companies like NEO-IT will surely hasten this move when smaller American companies have the comfort of an objective third-party evaluation and management group to serve as the front end to a well proven “faster, better, cheaper” Indian value proposition. The only thing that can go wrong with this model will be if some spurious or “has-been” groups start posturing as India experts and get a few gullible firms to look at them as serious program managers.

What also emerged on my recent trip was the importance of regional and global competition in future deals, particularly in the BPO space. It is not just the Philippines who are seen as front runners in the accounting back office area or Mexico and Costa Rica for proximity call centers, but also Pakistan in the healthcare outsourcing area and, of course, China for all kinds of tech help desks–all these countries are creeping into the consideration set of global corporations.

Closer home, the launch of the Gujarat chapter of the Nasscom SME Forum provided some interesting insights into the travails of that particular state. One of the few states that has actually shown a decline in IT fortunes, it will take more than posturing and possibly a lot of marketing aggression and incentives on the ground to induce industry majors and global companies to put Ahmedabad, Vadodara or Gandhinagar on their IT footprint.

The competition between the leading states and quite a few wannabes for both Indian and global IT investments is not letting up–an excellent sign for the renaissance of the IT sector that is now well in evidence. If the indomitable team of Vivek Kulkarni and Naidu in Karnataka continue to lead in terms of sheer marketing aggression, even relatively slow starters like Maharashtra and Chandigarh are pulling out all the stops in attracting investments to their part of the country. An icon of excellence in this area has always been the Maharashtra Industrial Development Corporation, whose well conceived and executed software parks in Mhape and SEEPZ in Mumbai, Kharadi and Hinjewadii in Pune and various other parts of the state have all found new takers to fuel the growth of IT in the state.

There is an air of euphoria all around the country–a good monsoon, a newly confident manufacturing sector and a resurgent software industry–no wonder then that even the dastardly events in Mumbai did not deter industry or the stock markets for more than a day. With all sectors growing and excellent partnerships between the industry, governments and academia beginning to flourish, there is pride in being Indian–at last!

Ganesh Natarajan
The author is deputy chairman & managing director of Zensar Technologies and chairman of Nasscom’s SME Forum for Western India

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