'Future of IT sector lies moving up the value chain'

The future of the Indian information technology (IT) sector lies not just in providing cost-effective solutions, but how the industry can emerge as a provider of complete solutions and move up the value chain, working in a wide range of verticals, said experts from the IT industry.

Speaking at a panel discussion on "Future Direction of the Indian IT Industry", organised on Thursday evening as part of Confluence 2004, industry leaders said that while the future is indeed exciting for the Indian IT industry, it must not focus on just providing cost-effective services.

Clayton Locke, managing director, Sapient India, said that as in other sectors, it is all about economics in the IT industry too, but while India has enjoyed a huge advantage so far in respect of cheap manpower, it is time that the manpower is able to provide something different, something more comprehensive and sustainable.

"Pricing alone will not sustain growth in the near future as far as the IT industry is concerned, but the future is still exciting for the industry in India," he said.

According to estimates, in the next two years alone, there will be a demand for 20,000 software professionals in the country. While the global IT industry is growing at between three and five per cent per annum, the Indian IT industry is growing at around four times this rate. Locke, however, added that a major discipline exercise will be needed for Indian companies to go higher up the value chain.

Sudhakar Ram, chief executive officer, Mastek India, said that having laid the foundation for growth, the next big challenge for the Indian IT industry is to take a larger responsibility. "Apart from the US, no other country has really been able to create brands in IT. We must be able to put through complete solutions even while we enjoy the pricing advantage," said Ram.

Inderpreet Thukral, director, marketing and strategy for IBM India, stated that the issue now facing the industry is not whether it can do jobs cheaply, but whether it can add value.

"Business and technology are now more intertwined than ever before and the need to innovate is very powerful at the moment," he stated.

Chairing the panel discussion, B H Jajoo, a professor of IIM-Ahmedabad, said that even as some Indian IT companies have entered the big league, many multi-national IT giants too have entered India.

"The past four years in the Indian IT industry have been of consolidation, even as it experienced a rapid growth in the five preceding years. The focus in the next five years should be to provide comprehensive solutions to the world rather than just getting jobs done here," he felt.