Geopolitical developments won’t affect technology spend: Mindtree President

At a time when rising protectionism is threatening the business model of many IT companies, some business areas of tech spending will not be affected.

Talking to BusinessLine on the sidelines of the Nasscom India Leadership Forum, NS Parthasarathy, President and COO of Mindtree, said that geopolitical dynamics will not influence the “digital” part of outsourcing.

“It is a very different animal and we believe that having local people working on digital technologies is something we envisioned several quarters back and will be th way of the future,” he said. As a part of this, Mindtree plans to open a digital experience centre (called Digital Pumpkin) in New Jersey, where clients can come and do a pilot for their future projects.

Parthasarathy’s views come at a time when US, which is the largest market for the $160 billion IT industry is resorting to protectionism in the form of stricter curbs on outsourcing coupled with hike in H1-B visa fees.

Mindtree gets around 39 per cent of its revenues from Digital but is seeing deceleration, opine industry watchers, due to intense competition.

Parthasarathy points out that this is not something to worry about as companies are starting to embark on their digital journey. “The Indian IT industry will see more change in the next 5 years than the last 25 and way of services delivery will change,” he said.

This change mandates more people to be located in on-site locations, an area where the Indian exporters have been using local Indians to do the job. Companies like Mindtree are taking a two-pronged approach.

The first is to focus on local hiring and the second is on training Indian engineers in Digital.

The latter is a concern area, especially amongst engineers who have some experience who seem to be bogged down with old mindset. “The changes in mindset required in Digital will be easy for freshers but for others it will be difficult,” Parthasarathy said.

He added that around 1,600 Mindtree employees are trained in Design Thinking and other technologies, which are required for companies to adopt Digital.

Going ahead the company plans to grow higher in Digital than its average business, which has been growing the early to mid teens in the last few years.

Industry body Nasscom said that the sector will grow at 8.7 per cent in the 2017 fiscal but has shied away from making a guidance for the 2018 financial year, citing uncertainty over the global political scenario.

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