Embracing new markets, trends

For years, the Indian information technology-business process management (IT-BPM) sector has continued to take the world by surprise, consistently contributing towards the nation's economy and putting India on the global map. From $100 million two decades ago to $108 billion today, the sector has witnessed a momentous jump within a short span. The unique India value proposition of competitive costs, skilled talent pool, customer-centric service providers and excellent business infrastructure has ensured continued growth of the sector.

Looking ahead, we think these are exciting times for the sector; the opportunities are immense. What will keep the momentum will be large untapped demand, enhanced adoption and widening scope of the global delivery models (in regions and vertical markets).

What is heartening is to see is the change in other countries' perception of Indian companies. The IT sector in India today is looked at more and more as a strategic partner to drive productivity gains and business outcomes. From service providers to consultants, we have indeed evolved.

The sector has been able to position itself as a partner to customers, by changing the way service is delivered and creating a broader impact on clients. What started with backoffice activities; basic data entry tasks, voice-based customer contact/support services, etc, has evolved to include increasingly complex processes involving rule-based decision making and research analytics.

Services incorporating social, mobility, analytics and cloud (SMAC) are today reshaping the way the IT-BPM sector has been providing services. SMAC is becoming a business reality. The convergence on these technologies means undoing the traditional business design. These together present a huge global opportunity of over $1 trillion by 2020.

The past few years have also seen a rapid shift in economic activity towards newer countries (Brazil, China and Russia) and the untapped markets of the developed world continue to present new opportunities for the industry, which could drive the next phase of growth. The domestic market for IT-BPM services has also been vibrant, despite the lack of cost arbitrage. Enterprises, government and consumers, all three customer segments, are set to drive the growth of the country's IT-BPM sector.

With economic uncertainty settling in, cost predictability has taken a hit. Consequently, the sector is relooking at its pricing models, facilitating flexibility in operating models and enabling cost predictability for customers. The standard pricing model followed by the industry was full time equivalent-based; several new pricing models have emerged over the years that encourage innovation, flexibility and efficiency. These pricing models also deliver renewed value beyond cost savings to customers.

To accelerate growth, the Indian IT-BPM sector is trying to move away from cost advantage to delivering value to customers, which in turn will enable non-linear growth.

The extraordinary growth of the Indian IT-BPM sector is a matter of pride for us. The next few years will be different from the last ones, owing to a radically restructured global economy; evolving customer needs, services and business models.

The sector has geared up to embrace these changes and work towards higher growth. The key to this will be the evolution - in terms of expanding our verticals and markets, attracting new customer segments, transforming from technology partners to strategic business partners, imbibing a shared vision and offering considerably wider spectrum of services over the next few years.

The author is president, National Association of Software and Services Companies