Today , when we talk about the IT for Indian IT service provider, the obvious answer
comes is “Growth”. IT & ITES having lots of potential to grow in every fields, be it Telecom, Retail, Banking & Insurance, Manufacturing , Govt. every industry is buzzing with the growth, the enormous growth, companies can look for building to their TOP line but the real game changer would be the the BOTTOM line, which would make the difference in long run. In my views, organization would require to build the right block today, in order to reap the benefit after 20 year down the line.
Below would be the key challenge and focus area for an Indian IT companies –
1. Customer- “Customer is the First.”Organization need to inculcate the culture of Customer first in every facets of their function.
2. Innovation – If you look into the TOP five IT companies, major chunk of their earning comes through the operations and maintenance, managing client Infrastructure, which reckon the need to innovate. There is fundamental difference between Invention and Innovation. Organization to build product or services which should give revenue and profit. Organization need to look into the ways through which the Opex of their client can be reduced. Cloud computing surely help in that, still a lot need to be explored in order to make it the need of hours.
3. Execution- Companies, which would innovate and have faster execution, would lead the race. The recent data published on the R&D spends by TOP IT companies is really surprising. If you look into the Balance sheet of companies, companies hardly spend on R&D .Companies need to spare significant part of their spending into R&D, which is the investment, for the future. Microsoft spend 15% of their revenue into R&D, and our IT companies are no where, even not the 1%.
4. Operating Margin- This would surely be the key focus for all IT companies, with the time the margin would reduce, companies need to innovate and have best execution plan would win the race.
5. Continuous Improvement- This is analogous to innovation, companies need to build the culture of continuous improvement, in the every facets of its functions, processes ,be it project management, customer interfacing or customer advocacy.IT companies should lean from the mature manufacturing industries, who have pioneered the concept of lean, sig sigma and Kaizen.
This is very much understood, margin would be tight and under pressure in years to come, only those companies would survive who build the sound framework for Innovation and execution, in past we have seen even the giant companies have faced such situation, be it Lehman Brother, General Motors, Nomura and many more. The current lookout of TOP IT companies would surely change in years to come.