IT/ ITES

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IT industry - industry
7.2%
Contribution to GDP
USD 167 bn
Industry FY’18(E)
10.71%
Growth CAGR
USD 350 bn
Industry FY’25(E)
Source:IBEF,NASSCOM,DIPP,Aranca Research

IT industry - employment
5200
Start-Ups
3.97 mn
Employees

Evolution
Source:IBEF,NASSCOM,DIPP,Aranca Research http://www.indiastudychannel.com/resources/151102-History-Of-Information-
Technology-In-India-And-Why-The-Recent-Boom-In-It-Sector-In-India.aspx,
Outsourcing
work to India
Pre 1995
Increased
investment in
R&D
Product
development
destination
1995-2000
Indian firms
Grew in sizes
More & more
western
companies set up
their bases in
India
2000-2005
Companies
moved from
only
services to
solutioning
2005-16
What’s
next?*
2017
*will be discussed in next slides

Key segments (1|2)
1. IT Services
US$ 86bn (FY 18)
Market Size
51.7%
Revenue of total IT
sector
BFSI
Major vertical
81%
Revenue comes
from exports
2. Business
Process
Management
US$ 32bn(FY 18)
Market Size
19.2%
Revenue of total IT
sector
US$ 54 bn
Expected by FY25
87%
Revenue comes
from exports

Key segments (2|2)
3. S/w products &
engineering
services
US$ 33bn (FY 18)
Market Size
19.8%
Revenue of total IT
sector
83.9%
Revenue comes
from exports
4. Hardware
US$ 15.4bn(FY
18)
Market Size
9.3%
Revenue of total IT
sector
Domestic market is
significant

India’s IT market growth
Source:IBEF,NASSCOM,Gartner,Aranca Research
24
29 32 32 32 34 35 37
41
50
59
69
76
87
98.5
108
117
126
0
20
40
60
80
100
120
140
160
180
FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18
IT Industry in India (US$ bn)
Domestic Export
10.71% CAGR

BFSI is a key business vertical
Source: IBEF, MEITY report
13.70%
24.26%
27.50%
33.20%
39.30%
47.20%
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
30.00%
35.00%
40.00%
45.00%
50.00%
Tech Mahindra Mindtree Wipro Infosys TCS L&T Infotech
Revenue share of IT majors from BFSI(%)
Note: Includes only IT Services and BPM segments

The industry dynamics (% of total export revenue)
Source: IBEF, Nasscom
Large (10-12)
48%
Medium
(120-150)
33%
Emerging
(1000-1200)
10%
Small ( ~15000)
9%

The industry dynamics (% of total employees)
Large (10-12)
37%
Medium
(120-150)
29%
Emerging
(1000-1200)
17%
Small ( ~15000)
17%

Favorable macro factors for future: Global GDP growth and
increase in technology spending
Source: 1.Gartner (includes IT services and enterprise software revenues) , Nasscom, Everest Research
•  Global Digital spend to increase from USD 180 Bn in 2017 to USD 310 Bn in
2020; Growing over 20% YoY
•  USA lowest unemployment in 45 years, increased retail spending, increasing
wages BUT challenges wrt immigration reforms and impact of new tax
reforms

Trend#1 :: Global delivery model
Indian Product
industry
US$ 100 bn
expected to reach by
FY’25
Global delivery
centers
1000 in numbers | 80
countries by Indian cos.

Trend#2 :: Leading sourcing destination
Prominent sourcing
destination
55% market share
in global services sourcing
business FY18
BPM sourcing market
38% share in overall
sourcing market

Trend#3 :: New Technologies
New growth avenues
Cloud computing, social
media, analytics and other
emerging technologies
SMAC
Expected to grow to US$
225 by 2020

Trend#4 :: Rural development
Lot of schemes
e.g. National Optical Fiber
Network (NOFN)
Being Laid-out to connect
2.5 lacs gram-panchayat

Trend#5 :: Emergence of Tier II cities
Source: IBEF, Nasscom, https://www.99acres.com/articles/it-majors-heading-to-tier-ii-and-iii-cities-for-expansion.html
Tier II & III cities
IT companies aiming to
establish business
Cheap labor, RE, tax
breaks| SEZs
Emergence in new IT
destinations

Trend#6 :: Changing business dynamics
Smaller deal sizes
Changing from few large
size deals to big size deals

Trend#7:: R&D and skilling
Promotion of R&D by
companies
Investment by companies
Skilling| Re-skilling
Employee productivity
and future skills

Future growth drivers are demand, demographic and policy
driven
Global demand
Only global BPM spending
to rise to US$ 233 bn by
2020
Domestic growth
Increasing adoption of
technology and telecom
by consumers
Talent pool
Favorable demographics,
focus on skilling |
reskilling
Policy support &
Infra
Improving IT infra, Tax
Holidays, STPIs, Govt.
support in leveraging AIs

New Digital Technologies Exports have become new growth
engine
11
16
25
0
5
10
15
20
25
30
FY16 FY17 FY18E
Export revenue from Digital (US$ bn)
Export revenue from Digital (US$ bn)

Entry level Indian talent pool for IT industry
Source: IBEF, Nasscom, Everest Group
651
707
753 771 779 787 794 802
0
100
200
300
400
500
600
700
800
900
2013 2014 2015 2016 2017 2018(E) 2019(E) 2020(E)
Number of graduates (in '000)

SEZs* + STPIs* + Tier II cities emergence
Source: EY,Nasscom, IBEF
Parameters STPI SEZ
Term •  10 Years 15 years
Fiscal benefits •  100 per cent tax
holiday on export
profits
•  Exemption from
excise duties and
customs
•  100 per cent tax holiday on
exports for first 5 years
•  Exemption from excise
duties and customs
Location & size •  No location
constraints
•  23 per cent STPI
units in tier II and
III cities
•  Restricted to prescribed
zones with a minimum
area of 25 acres
*SEZ: Special Economic Zone, STPI : Software Technology Parks of India

Growth of Global In house Centers (GICs a.k.a. captive
centers)
Source: Zinnov,Nasscom, IBEF
180
460
710 760 790 825
1025 1050 1100 1140
0
200
400
600
800
1000
1200
2000 2005 2010 2012 2013 2014 2015 2016 2017 2018
Number of GICs in India
•  GICs in India today represent a US$ 23.1 bn industry
•  Also important because it helps in building India as R&D hub and an
innovative ecosystems
•  Engineering Research and Development/Software Product Development (ER
D/SPD) is the largest sub-segment
•  North America and Europe represent 90% of the captives in the country

Investment in the sector by PE/VCs (1|3)
Source: PwC
0.8
1.9
3.2
2.2
5
9
5
7
7.6
0
1
2
3
4
5
6
7
8
9
10
FY08 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18
PE investment in IT & BPM (US$ bn)

Source: PwC
116
180 193 209
332
437
322
245
0
50
100
150
200
250
300
350
400
450
500
FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18(upto
Dec'17)
Number of deals

Source: PwC
25.10%
31.50%
37.30%
40.30%
52.90%
55.50%
48.60%
56.30%
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18(upto
Dec'17)
% of total deals of PE/VC

Available roles
Consultant|Subject
Matter Expert :
Industry and Function
Project & Program
Management
Pre Sales & Sales
Note: Please note there are some roles which have been offered in emerging technologies, it
will be covered in Analytics/ Emerging Technologies reports

Pre Sales
Role
• Proposals
• Bid Preparation
• Solutioning
Required
competencies
• RFP by Nagpur
Metro Rail project
for a large scale ERP
implementation
• Creating Proof of
Concept for
showcasing how
inventory will be
managed in a Pharma
Company
• Presentation Skills
• Coordination with a lot
of experts
• Networking
• Broad understanding
of Process/ Industry/
Tool

Sales
Role
• Hunting
Finding new customers
• Farming (Account
management)
Growing business from
existing customers
Required
competencies
Target driven
A good chunk of your
compensation may be
linked to target
• Sales skills
• Ability to identify
different stakeholders
(Influencer, Gate
keeper, Decision
maker)
• Competitive
intelligence
• Understanding of your
differentiation
• Go with the Experts
• Problem Solving skills
• On the feet thinking
• Negotiation

Project/ Program Management
Role
Managing projects,
teams, clients and other
stakeholders
Required
competencies
Managing a
Digital
Transformation
Project
at one of the
leading Automobile
Company
• Project Management
•  Timelines
•  Resourcing
•  Deliverable
•  Quality
•  Reporting
•  Billing/ Costing
• People Management
• Stakeholder
Management
• Client Management
• Decision making/ Take
calls
• Change Management

Consultant : Subject Matter Expert - Industry
Role
You will be positioned
as Consultant/ Industry
Expert/ Product Expert
SME also helps in
building credibility
and connects with the
client.
Required
competencies
Pitching for a huge
French Power
Producer for an ERP
solution for its Indian
Plants
Post winning you will be
providing the
solutioning
Understanding of
• Industry
• Industry Specific
processes
• Regulations
• Best Practices

Consultant : Subject Matter Expert - Function
Role
You will be positioned
as function expert
SME also helps in
building credibility
and connects with the
client.
Required
competencies
Pitching as a functional
experts for say Sales /
Supply Chain/
Maintenance
functions
Understanding of
• Function
• Best Practices

Interview format (1|2)
• In depth account of
what you have done
• About the projects
which has some IT
relation
• What is the value add
from MBA
Resume Based
• How will you choose a
team
• How will you resolve
conflict in a team
• How will you manage a
team of youngsters
from IITs
• How will you come to a
conclusion when there
is no majority of
opinion in team
• How do you manage
working capital of a
consulting firm
• You have to set up a
McDonald franchise in
a smart city, what
factors will you
consider
• Guesstimates
• Given the case, create
presentation
Situational/ Behav. Case Based

Interview format (2|2)
Used cases/ examples of
technology in your and
related industry
Used cases

Thank You

Examples of companies having R&Ds fucntions in India
T.I.
Yahoo
Microsoft
Adobe
Cisco
Intel
EMC
Goldman Sachs
Wells Fargo
JP Morgan
VMWare
JCPenny
Phillips
Juniper
SAP
GE
R&D
Source: https://timesofindia.indiatimes.com/business/india-business/bengaluru-is-changing-from-it-services-cenrte-to-mnc-rd-hub/articleshow/63735346.cms

Examples of companies having Product Development
Centers in India
MicroSoft
Yahoo
Adobe
PDCs
Source: https://www.livemint.com/Industry/DizxFoXjFZLFIigewdmKGI/Software-firms-RD-centres-in-India-facing-doubledigit-att.html

Examples of Indian Software Products
StartUps
•  Flipkart
•  Swiggy
•  Byju’s
•  Many more
Products
Source: https://www.livemint.com/Industry/DizxFoXjFZLFIigewdmKGI/Software-firms-RD-centres-in-India-facing-doubledigit-att.html, Wipr/ Infosys
website, https://investors.cognizant.com/2014-09-15-Cognizant-to-Acquire-TriZetto-Creating-a-Fully-Integrated-Healthcare-Technology-and-Operations-
Leader
Infosys
•  Finacle
•  Nia (AI platform)
•  Infosys Information
Platforms (IIPs : an
Analytics platform)
•  Panaya (Cloud based
Enterprise Agile
Deliver Platform )
Wipro
•  Holmes
CTS
•  Acquired a health
product company
(Trizetto)

Examples of Global Deliver Centers
Mexico – LATAM
Poland – Eastern
Europe
Mauritius – French
Dubai – Middle east
GDCs
Source: https://www.livemint.com/Industry/DizxFoXjFZLFIigewdmKGI/Software-firms-RD-centres-in-India-facing-doubledigit-att.html, Wipr/ Infosys
website, https://investors.cognizant.com/2014-09-15-Cognizant-to-Acquire-TriZetto-Creating-a-Fully-Integrated-Healthcare-Technology-and-Operations-
Leader

It companies in Tier II/III cities
Oracle – Jaipur/
planning in Gujarat in
GIFT (Gujarat
International Finance
Tec-City)
TCS/ Wipro/
Cognizant: InfoPark
Kochi
Companies if T2/T3 cities
Source: https://www.99acres.com/articles/it-majors-heading-to-tier-ii-and-iii-cities-for-expansion.html
Cities getting
attraction
Jaipur
Visakhapatnam
Chandigarh
Vijayawada
Mysore
Kochi
Coimbatore
Bhubaneswar
Ahmedabad

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