Until now, the Indian IT services business gained ground on the back of a simple premise. You make a tonne of money by replacing a $125,000 resource with a $40,000 - $50,000 Indian resource. I would never have changed the model at Infosys, it was too successful there. Here, the premium the company commands on the market comes from the predictability of its revenues. And that predictability comes from adding, say 25,000 people to the business every year.
(This story appears in the 14 August, 2009 issue of Forbes India. To visit our Archives, click here.)
There is nothing new in the Software as a Service model or Cloud computing as it is called these days. Amazon offers certain warehouse and billing services to retailer and so do Google. But a large enterprise is never going to trust an outsider to run their systems. Payroll processing is ok but who is going to let you run their Account Receivables when they know you are running it for their competitor too or may do that in future.
on Aug 6, 2009The outcome based model has been mulled over by many companies over the past specially the consulting companies. But no one is willing to take the plunge as it involves risk. This recession is a great time to offer such model to the client and bring in disruption. But Indian IT companies are still doing contractual job and hence paid by that model.
on Aug 5, 2009