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Saturday, March 01, 2008
Sramana Mitra, whom I regard highly, comes out with a provocative article – may be the title is more provocative . While I agree with her on the part of the offshore headquartered industry needing to look more at products and solutions, I disagree with most part of the article and her conclusions. Getting into products business is a moot point – its like saying Singapore airlines should get into aircraft/aircraft parts manufacturing,to be counted as future safe in business! I find most part of her article somewhat biased. In particular –
“India's $30 billion IT/ITES services industry, meanwhile, is slowly and surely losing its competitive advantage. They are complacent. They will not take risks. They have "outsourced" thinking to their customers”. None of this is true- my submission.
Ask the CIO’s working with the offshore majors to get a true picture. The fact to note is that Indian IT’s rise as a disruptive force in global IT services delivery is now well accepted. Three – four years from now, the Indian IT services and business process outsourcing (BPO) is very likely to touch US$100bn mark in revenues. In the last ten years, every possible forecast has been bet by the industry and the naysayers have had to bite the dust. The coming years are proving to be as promising and transformational as in the past. Just look at the track record -In the last ten years, the Indian headquartered IT will have grown by nearly twelve times, at a 28% Cagr, compared to a 5.3% Cagr for global IT services spending. Within global IT expenditure, the outsourced component will have grown by around 8%, and in-house spending at only 2-3% - both substantially lagging Indian IT’s phenomenal rise.
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