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2011 – a year of positive growth
NASSCOM states that the IT export revenues grossed an estimated US$ 59 billion in FY2011 accounting for a 2 million workforce. The year was characterized by a consistent demand from the US, which increased its share to 61.5 per cent. Emerging markets of Asia Pacific and rest of the world also contributed significantly to overall growth.
While the sector’s vertical market mix is well balanced across several mature and emerging sectors, FY2011 was not only characterized by broad based demand across traditional segments such as Banking, Financial Services and Insurance (BFSI), but also new emerging verticals of Retail, Healthcare, Media and Utilities.
India has retained its position as the leading global shoring destination with a 55 per cent share of global ITO and BPO market in 2010.
Changing trends
With customers now pushing for more collaborative contracts, where there is business metric performance measurement and greater risk-reward sharing, NASSCOM states that the Indian industry is increasingly being driven by:-
Transformational Business impact.
Client business transformation is happening through:
• Verticalised solutioning (developing and delivering end to end services keeping in mind customer needs, creating products for emerging markets and substantial revenue impact for them)
• Technology enablement ( Developing cloud based products and solutions, integrating business intelligence, and application development tools)
• Process innovation/re-engineering (automation and six sigma skills, incremental set
of enhancements)
Service Delivery maturity
There is now an increased globalization in service delivery, cross border collaboration and partnerships to enhance service offerings, and reengineering of the talent pool for greater productivity and efficiency
Scalability
India’s scale and flexibility has been quite unique- a vast labour pool, network of Tier II/III cities offers further cost reduction and increased infrastructure spend are the cornerstones to this advantage offered by India over other locations.
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| Growth drivers |
| • Return of discretionary spending • New business models encouraging first time buyers • Re-invented value proposition for existing ones • The largest pool of employable talent • Service delivery infrastructure across multiple geographically dispersed locations within the country • A supportive policy regime. |
People-friendly work environment
It’s a people’s industry, so special care is taken for the welfare, recreation, safety and security of employees. IT offers basic facilities right from pick and drop to providing food, gyms, indoor/outdoor sports etc as a part of the work culture.
IT Tomorrow
While developed markets constitute the largest share of IT spend, increasingly emerging markets are spear-heading growth as a large consumer base becomes increasingly tech-savvy and enterprises adopt IT solutions to improve their global competitiveness.
Given this scenario, the Indian supply base has begun to explore market opportunities beyond US and UK. By 2020, 80 per cent of incremental growth will be driven by opportunities outside the current core markets, verticals and customer segments.
The exports component of the Indian industry is expected to expand three-fold and reach US$ 175 billion in revenues by 2020. Focused initiatives and innovationled growth can lead to additional revenues of up to US$ 135 billion by 2020. The domestic component is also expected to grow upto US$ 50 billion.
The uptake has been led by the aspiring Indian enterprises increasingly competing in the global markets and planning their IT strategies with enhanced focus. The government will be a key driver for increased adoption of IT-based products and solutions. It has embarked on various IT-enabled initiatives including in Public services (Government to citizen services, citizen identification, public distribution systems), Healthcare (telemedicine, remote consultation, mobile clinics), Education (eLearning, virtual classrooms, etc) and Financial service (mobile banking/payment gateways), etc.
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