Sudhakar Ram, Chairman and Managing Director, Mastek Ltd

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Sudhakar Ram, Chairman and Managing Director, Mastek Ltd

  1. 1. Indian IT: Shifting sights from America to Europe Is that the solution? Sudhakar Ram Chairman & Managing Director Mastek Ltd www.mastek.com 13 February 2008
  2. 2. Indian IT/ITES: Low penetration in large markets <ul><li>Attempts to ‘shift focus from America to Europe’ assumes that the industry’s current challenges are geography-led, not business model led </li></ul><ul><ul><li>Market penetration data paints a different picture </li></ul></ul><ul><li>The US accounts for ~67% of India’s IT/ITES export, but our share of addressable market is very low </li></ul><ul><li>Penetration is relatively better in the UK! </li></ul><ul><li>UK has traditionally been more open to higher-end services </li></ul><ul><ul><li>The Mastek experience (LCC, NHS) </li></ul></ul><ul><ul><li>Results in relatively higher penetration </li></ul></ul>*Nasscom Strategic Review 2006 & 2007; CY2006/FY2006 estimated figures
  3. 3. ‘Solutions’ is the solution <ul><li>Indian IT industry heavily focused on ‘services’ </li></ul><ul><ul><li>IP-led offerings, IT consulting, & SI account for <5% of Indian IT/ITES exports </li></ul></ul><ul><ul><li>Limited presence in higher-end segments = Lower market penetration </li></ul></ul><ul><li>Shifting focus to Europe not the answer </li></ul><ul><ul><li>‘ Services’-led model accentuates language and cultural barriers </li></ul></ul><ul><li>Move up the value chain, from ‘services’ to ‘solutions’ </li></ul><ul><ul><li>Engage in higher-end consulting and IP-led activities </li></ul></ul><ul><ul><li>Strategic applications of IT </li></ul></ul>
  4. 4. Ride the ‘third wave’ of Indian IT <ul><li>Wave 1 (1969-1999): Establishing capability of the Indian professional </li></ul><ul><li>Wave 2 (1995-2015?): Establishing India as a destination for offshore programming </li></ul><ul><li>Wave 3 (2005 – 2020?): Indian IT players achieving world dominance </li></ul><ul><ul><li>Scale Play </li></ul></ul><ul><ul><li>Niche Strategy </li></ul></ul>~$1bn ~$20bn ~$100bn
  5. 5. Top-end presence drives broader market share <ul><li>Progression up the value chain drives greater market penetration </li></ul><ul><li>Higher-end presence does not preclude lower-end market share </li></ul><ul><ul><li>A solutions provider naturally gets to maintain delivered applications </li></ul></ul><ul><li>Shift towards IP-led IT solutions can enable: </li></ul><ul><ul><li>deeper inroads in both American and European markets </li></ul></ul><ul><ul><li>better margins to offset wage inflation & rupee appreciation </li></ul></ul>IP System integration Custom application development and implementation Application management
  6. 6. <ul><li>Shift focus to ‘solutions’, drive growth in both US and European markets! </li></ul><ul><li>Thank you </li></ul>

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