How will the next decade look for the Indian IT industry, which is now at the epicentre of tectonic shifts, from a business and hiring point of view?
This was among the questions discussed by the heads of India’s top three IT companies, in a panel discussion at the 28th Nasscom Technology & Leadership Forum here. While some of the answers were clear, some questions remained unanswered.
Take the example of India’s three-decade engagement with the IT sector, riding through the Y2K crisis, to the current onslaught of artificial intelligence and cloud computing. “The back-office story now is behind us. Now it is about transformation,” said Rajesh Gopinathan, CEO & MD, Tata Consultancy Services. The transformation that Gopinathan alludes to spans from how Fortune 500 companies are re-imagining their businesses, to domestic firms changing their approach towards using technology to meet their client needs.
India, with its 4 million IT workforce, seemed to have answers (due to significantly lower employee costs) to many questions posed by companies in developed markets. However, that has changed. “From a cost arbitrage we are now into transformational projects. It is about re-imagining the business along with our clients, for which certain bets are being made,” said Salil Parekh, CEO & MD, Infosys.
All this has resulted in clients from Fortune 500 companies shifting a considerable part of their IT spending to customer-facing areas. “The launchpad is strong and, if you look at the sector, with a 7.7 per cent growth rate at a $191-billion base, we are optimistic despite macroeconomic uncertainties,” said Rishad Premji, Chairman, Wipro. The philosophy of clients has changed in the last few years, he added. Parekh also pointed out that clients are now open to using automation in their businesses even as tech disruptions hit enterprises across the world.
So, which sectors are re-imagining their business? Parekh pointed to technology platforms for mortgages and insurance (with scale), where he said Infosys is seeing success.
While the new scenario plays out, what is happening to legacy businesses on which the Indian IT industry was built? “The nature of work is changing and we are using automation in some of the legacy areas,” said Gopinathan. Premji added that some businesses of the past are being let go (when they turn financially non-viable); in some cases they cannibalise their existing businesses. “If we don’t, the competition will, as it’s just a matter of time,” he said.
Even as Indian companies have expanded operations, job additions have been gradually coming down. “Additions will happen in new areas such as data analytics, cloud computing and even in design areas,” said Gopinathan. Some companies have been acquiring boutique agencies in the West while some have gone for re-skilling.
The focus, according to Premji, will also be on employability. “Questions on how to work with institutions of the future, the kind of curriculum, etc, is work in progress,” he said. The sector added 2 lakh jobs and, most importantly, employees are starting to embrace re-skilling, he added.
Gopinathan observed that employees are amenable to learning and respect what that learning gives them — something which augurs well for the sector. However, questions remain on macroeconomic concerns, in addition to protectionism and increased focus on data privacy, and how this will impact outsourcing service providers.