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Kripa Raman

E-governance is an uphill climb when it comes to tasting revenue. But ABM Knowledgeware says it can scale the heights. Just how?

ABM Knowledgeware Ltd operates almost entirely in the e-governance vertical. Surprising, since here, the return on investment and the possibility of attracting talent are lower than in other, more high-profile verticals.

The chief promoter of the company, Prakash Rane, himself admits that e-governance is still not a business model that gets return on investment (ROI).

But he is also strangely determined that his company will almost exclusively operate in this space. ABM's multi-purpose office information systems have been standardised for implementation by the Maharashtra Government for all its administration departments.

Its Citizen Facilitation Centre (CFC), of which a few are operational in Municipal corporations, has been recommended for replication across the State, so too the company's e-governance solution for the Thane collectorate called SETU.

The company's revenues for the last financial year were only Rs 5.9 crore, a miniscule figure by the standards of the larger software giants, which too have full-fledged e-governance divisions. But according to Rane, no company in India has really been able to make a meaningful break into the field. Quite naturally, he adds.

"When something gives 10 times as much return, why should one concentrate on e-governance? From the corporate persepective, the RoI is not attractive."

The key to e-governance is to earn revenues with decreasing costs and increasing repetition, he says. "Secondly, from the customer perspective, the transaction costs for both citizens and governments should decrease; thirdly, processes must be demystified and transparency augmented."

What his company is close to cracking, he claims, is the replicability and scaleability of the software solutions that are offered. The objective is to replicate with ease the same e-governance solution across the country without the need to do heavy recoding and reprogramming. "We are into relatively more generic work."

The company's urban local solution for the Kalyan Dombivli Municipal corporation (KDMC) in Mumbai has reengineered 400 processes and converted them into 100 citizen services that are available at one source point. This is going to be replicated across five municipal bodies in India.

"When you consider that there are 6,000 municipal bodies in India, you can imagine the potential," says Rane. Already the company's earnings from licensing out some of its solutions account for almost 20 per cent of total revenues, and this is set to increase. The company holds an IPR for a water billing solution too. Additionally, it is present in the Gulf market, one of its projects being for property management for the Crown Prince of Abu Dhabi. This can be replicated across the emirates, he says.

"Project management challenges in e-governance, as well as domain knowledge collection, are long and arduous processes. And replication is the biggest challenge" he says.

And large companies that are answerable to their shareholders cannot display quick growth. This is why his company continues to bet on this vertical, he says.

Currently, ABM's growth is entirely from internal accruals. It is open to a strategic investor, "provided the investor is useful." The company would be open to such a thing only if the partner brings in expertise in business development as well as additional technological inputs. ABM has 200 employees. The attrition rate is 10 per cent, higher than the average, admits Rane, on account of there being so many overseas opportunities in other verticals.

Rane is bullish on e-governance although the giant government projects are likely to go to the larger, well-established software giants. But the proof of the pudding is in the eating. Rane says his company's rate of success is 80 per cent, compared to the average rate of success of 20 per cent of e-governance projects.

Almost 8,000 citizen transactions a day are already happening through its implemented projects, he says. Also, some e-governance contracts are not that large that his company cannot bid for them. There is also money to be earned from ABM getting a portion of the transaction fee that happens throught citizen facilitation, water billing and other projects.

Not only that, the potential is enormous. The e-governance outlay of the Indian Government is likely to be close to Rs 12,000 crore, he says. ABM has also collaborated with Spanco Telesystems to develop a Disaster Help Line for the Municipal Corporation in Mumbai. Access code `108' is aimed at optimising resource mobilisation during disasters such as earthquakes, bomb blasts, landslides, building collapses, and major accidents in Mumbai.

kripram@thehindu.co.in

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