The Hindu Business Line : `SMEs have to pool skills to survive'

"Large companies have begun to provide end-to-end solutions, leaving less room for small players. Even if SMEs have good products, they would not be able to take them to the market unless they have large resources".

Hyderabad , Feb. 15

THE changing technology landscape and relatively tougher business environment have thrown up new challenges for the small and medium enterprise services providers. These demand new strategies that include alliances in some cases and a consortium approach in some others, according to experts in the technology sector.

Speaking at an interactive session "A Confluence on Planning Survival and Growth of SMEs in IT and ITES Sector," the President of Hyderabad Software Exporters Association, Mr Shakti Sagar, said the entire approach to business generation would have to change given the new competitive environment in the global market place.

This called for new strategies, wherein SMEs could possibly leverage collective strengths and jointly bid for projects and execute them based on their expertise.

"This has been necessitated as large companies have begun to provide end-to-end solutions, leaving less room for small players. As large corporations work towards vendor consolidation, their choices have narrowed down to a few service providers, making their administrative interface easier," Mr Sagar said.

The Chairman and Managing Director of i-Labs, Mr Srini Raju, said the market had matured and most business areas were now being serviced by large companies. Only few business verticals and niche areas are open for small corporations.

However, they are faced with challenges of tough business environment, difficult times to generate resources required for marketing. This meant smaller corporations would have to merge with large corporations and explore business opportunities, he said.

"This is a period of consolidation and even if SMEs have good products, they would not be able to take them to the market unless they have large resources".

The Chief Executive Officer of National Institute of Smart Governance, Mr J. Satyanarayana, said that large companies could possibly partner with SMEs and outsource some of the jobs. This will turn into a win-win situation for all the players in the chain. "