Impact of Retail FDI to IT Company..

Ushering the FDI door in India, is welcome move for tapping the growth in laggard retail Industry. This is the one Industry where, investors, academicians and economist were keeping the tab since a long time. Relaxing the FDI norms in retail, will open new avenue of growth and investment, and that to with the higher customer satisfaction. This will bring new technology and new ways of reaching retail customer, Wal-Mart is known for excellent supply chain worldwide and is the largest Retailer in the world. With the opening of FDI norms, now like Wal-Mart and other large retailer in world will be able to take-up the front end role in Indian retail store. There will be increase traction in supply chain and Information technology will play major part in doing it. This will call Indian and World IT service provider to nourish the approx $780b Indian Retail Industry. This will open new way, new job opportunity and surely a way for IT company to increase their revenue. Today, the size of entire retail both organized and un-organized, is not known, but IT company can tap the unexplored world of retail. Compared to World Retail Industry, Indian Retail market is still the nascent and there are lots of benchmarks available in this space of Indian retailer to achieve for. But surely the first step has been taken by government by easing the norms, Indian retail will witness the growth, which IT and other Industry has witnessed after opening the world market in 1990 in last 20 years. The journey has just begin, there is long way to go, India need to pick up the race, where Chain and other developed world has already made the mark. However this will surely cheers the many.

Untapped Growth ..

I was recently going through the Book “The World is Flat” by the great Thomas L Friedman that was first published in 2005 and republished in 2006 with few updates. Though it is now 5 years old, but the thoughts are still relevant and holds good today. One of my friend, who is in the retails, was looking for the cost effective distribution management system and Point of sale solution for one of his retail garment store. His objective was a cost effective solution, minimal investment is IT and Infrastructure and any time sales(Mobile Sales). I thought let me help him to suggest some of the COTS products, which are backed up by large organization. But his objective was very clear, no or minimal investment on IT. Then I started searching for open source, and I was amazed with the list when in googled the “Open source POS solution”. There are more than 20 different product in market which offer best in feature with all his intended needs. The next wave of flatness has already reckoned the mobile applications, today India is the largest developer of Mobile application for all mobile handset, be it ipad, Andorid or windows platform. With the globalized economy and flat world one can build an applications in India and sell it to customer based out of US. This has been made possible only through the increased collaboration. We[Indian] should reap the benefit of this and get ahead, there is still lot need to be done, India being the second largest populous country in the flat world, but we just have 10% internet penetration, the scope is huge, there is an explored world is waiting for the 90% people of India. However this can not happen until the basic needs to people is fulfilled. I was amazed with the recently published report that 30 % of people live in less than $ 2 per day. The growth pace in China is faster than in India, thanks to the better infrastructure, committed Governance and zeal to rule the world. We[India] are venerable not only due to China, but the Middle east and African countries ,which are moving fast to pickup the economic growth. This part of unexplored world is due for huge growth. They are continuously improving the Governance, Policy and strive for growth. The unrest happened in recent past in lot of African countries is opening the doors of better governance, improve policy and globalized economy. In this globalized economy, no country can rule the entire world, one need to continuously improve and innovate to serve the customer better what has been offered to him/her. The journey is still on….

TOP FIVE Watch for IT&ITES in year 2011.

1. BFSI- Imagine how many Indian are Unbank today!! how may people are insured today!! 2. Cloud Computing- Some hope for SMBs, to look for pay per use IT Services &infrastructure and focus on their core competencies rather than putting investment in IT/IT Infra. 3. Government- Think how many government agency have converted into IT savvy, with the launch of ambitious e-governance initiative by govt... 4. Telecom-Mobile banking is sure shot value differentiator for Telecom operator in this tight tariff regime to look to increasing the revenue. The stone has already led, with the announcement of some of the leading bank tying with the telecom operator for providing the services...

5. Retail – This sector is still nascent in comparison to other field for IT, This sector has lot of potential to grow in future, and a lot depends on the govt. policy, if govt. approves the 100% FDI in Retail, this sector will in full swing of growth.

What IT can do for Manufacturing?

Information Technology and Manufacturing industries are going hand in hand since the inception of computing. It has been reported that, the next wave of growth for IT or ITES would come from manufacturing – To tap this growth, there is a need of identifying the true potential this segment. It is undoubted that BRIC (Brazil, Russia, India & China) has already gone ahead in terms of penetration of IT into manufacturing. Today the Indian IT industry estimated at $60b of value. With the current growth it has been estimated that Indian GDP would touch to $4.2 trillion in next ten year. To achieve this growth, IT would surely be the torch bearer. There are couple of promising areas in manufacturing, which would see higher spurt in coming year. With the current estimate, Indian Auto car market would be close to China in next twenty years and would overtake US in terms of sales as well. This would require huge FDI in this sector. With the expected huge spurt in Infrastructure development, construction equipment manufactures would be higher sales volume. In order to achieve these high growth volume, manufacturing industry would require significant investment in R&D in terms of new product development, automation of production assembly line to meet higher volume target, greater safety measures , much efficient supply chain management, enhanced supplier /vendor management , reduce lead time /cycle time to meet the customer demand.

Indian Telecom Industry: What Next?

With over 700m subscribers already, Indian Telecom Operators are gearing for new paradigm for generating more revenues and improve the BOTTOM line. In my view, year 2011 or next 2-3 years will witness lot of activities in this space. Organisation would look for opportunity to grow and establish its base; I guess couple to potential areas to be looked into in near future would be- 1. Mobile banking-We have recently saw Mobile operator tieing up with the Indian banks to catch the race in this area, MB( Mobile banking) has huge potential , and can prove the differentiator in achieving the customer delight. 2. M&A- Consolidation would be the key brain teaser for Board of some of the Mobile operators when they will make future strategies for one’s organization. With tariff rate are already touching the bottom, there is little room on this to scale up the revenue. Still the 2G fiasco in on, the court slamming the penalty on the dubious licenses, delivered to some of the operator by DOT. Organization is fighting hard for break even and generating the revenue. These could lead to the road of mergers and consolidation in Indian Operator. Though still 30% of Indian population is un-mobile, yet it would be hard nut to crack for new Telco to serves them, while fighting against the BIG guns already in the fray. 3. Value Added Services(VAS)- This offering along with the MB would see lots of pressure and growth in the future. This space is still very niche and few organization commands .The huge chuck of companies expenditure would go on this.