The document discusses the shifting IT landscape from traditional outsourcing models to "as-a-service" models. It notes that customers want cheaper, better, and faster services, while service providers want to maintain revenue streams. The document argues that mid-sized and smaller enterprises will drive adoption of as-a-service models to avoid infrastructure investments. It suggests Indian IT companies transition to an integrator role partnering with as-a-service providers to remain competitive as their business models are disrupted.

1. Where is the
Market
Heading
Abhijeet Kelkar

2. What do customers want ?
•Cheaper
•Better
•Faster
TAKE AWAY
Customers want to move away from complexity f IT services and move to a world where they can focus on business and business processes.

3. What do ServiceProviders want?
•The opposite of all
described earlier.
TAKE AWAY
Service providers are focussed on an increasing revenue share. A dream world which will soon hit the wall. All Indian cos talk of growth.
At whose expense, the customers or western based service providers.

4. Traditional IT outsourcing was established in a different Era when
there was cold war and phone lines were analog.
Data is in my Back Yard. I control it
But what when Connectivity is Ubiquotous ??
TAKE AWAY
Many paradigms have changed but the IT providers seek to increase revenues in the traditional ways.

5. Where are we?Challengers
•New Challengers
•Google
•Cordys
•IPSoft
•Ebuilder
•AWS
•Concur
•Ariba
•SalesForce.com
TraditionalITServiceProviders
•Traditional IT
Services
Providers
•TCS,Infy,
•Wipro,Cognizant
•IBM,Accenture
•Mindtree etc
ThirdPartyAdvisors
•Third Party
Advisors
•TPI, KPMG,PA
•PWC etc
LawFirms
•Law Firms
•You
•Your
Competitors
Mr Customer
Traditional IT outsourcing Model : Apps and Infra
New IT outsourcing Model As a Servicepay as you go Model
Rodin
Set in Stone
Outsourcing
processes
Law firms
Blind to
Changing
processes
Dinosaurs
In an slow ly
dissappearing
Apps
and
Infratructure world
Infra
Apps
ShiftData
Cloud
Cheetahs
In a fast moving
Dynamic
As A Service Market
TAKE AWAY
All players in the traditional model see their Business model under threat Law Firms, Third Party Advisors and Traditional Outsourcing
companies. Challenged by the As a service players who seek to simplify to cheaper, better and faster.

6. Large organisations have over the years invested in AS IS NOW or Apps and Infra, Individuals
like you and me go for Skype, Hotmail, however the midsized and small companies will turn
the market to AS A SERVICE as they do not want to invest in Dead Infrastructure
Small
Enterprises
Mid size
Enterprises
Large
Enterprises
Individuals
Individuals like
you and me
are in the
AS A SERVICE CAMP
Large Corporations
Heavily invested in
AS IS NOW
APPS and Infra Camp
Infra
Apps
AS IS NOW
CAMP
Data
Cloud
AS A SERVICE
CAMP
TAKE AWAY
Mid sized and smaller enterprises will define the push towards the As a service model. They will be the players who do not want to invest in
the as is model. And have the critical mass to build a trend

7. 7
So why are we not going FROM AS IS to AS A
SERVICE MODEL
AS IS
NOW
Stack of
APPS
&
INFRA
ROAD BLOCKS
• Already invested
Millions
• Security
• Privacy
AS A
SERVICE
TAKE AWAY
The big firms have heavily invested in Infrastructure and services and will not walk away from that model. Plus privacy security and lack of a
trend in the Market is hampering the move to the as a service Model

8. ALL Indian IT companies are in a Red Ocean.
Red Ocean Strategy :
Focus on Existing Markets
Blue Ocean Strategy :
Create New Markets
Compete in Existing Market Create Uncontested Markets to Serve
Beat the Competition Make Competition Irrelevant
Exploit Existing Demand Create and Capture New Demand
Make Value Cost Tradeoff Break Value Cost Tradeoff
Align the whole system of a firms
activities with its strategic choice of
differentiation OR Low Cost
Align the whole system of a firms
activities in pursuit of differentiation AND
Low cost
TAKE AWAY
The cost model for Indian players will hit a wall sooner or later. Profitability figures show decrease year on year. With a focus on
headcount based revenue, the challenge will be from small global companies who standardize and automate processes.

9. 9
The Difference is what you Manage
On Premise
Data
Processes
Applications
Runtime
Middleware
O/S
Virtualisation
Servers
Storage
Networking
Infrastructure
(as a Service)
Data
Processes
Applications
Runtime
Middleware
O/S
Virtualisation
Servers
Storage
Networking
Platform
(as a Service)
Data
Processes
Applications
Runtime
Middleware
O/S
Virtualisation
Servers
Storage
Networking
Software
(as a Service)
Data
Processes
Applications
Runtime
Middleware
O/S
Virtualisation
Servers
Storage
Networking
Process
(as a Service)
Data
Processes
Applications
Runtime
Middleware
O/S
Virtualisation
Servers
Storage
Networking
You Manage Others Manage
TAKE AWAY
The trend is particularly mid and small enterprise customers moving to the right as they seek to focus on their business and large
enterprises which seek to rationalise their investments. The trend for all is to move right to the proces as a service model if it fits them.

10. 10
Which are the companies and the decision makers
IaaS : VCE, Amazon, DELL, Microsoft, Google
PaaS : Azure, Google Apps Engine, Net Suite, Force.com
SaaS : Salesforce.com, Office 365,Google Apps, Ariba, Concur
BPRaaS : EBUILDER, CORDYS
Network
Architects
Application
Developers
Business
Users
Business Unit
Heads & CFO
Private Cloud Virtual Private Cloud Public Cloud
Increasing Businesss Value
TAKE AWAY
For Indian players the threat will come from the top layer BPRAAS as the bottom layers are commoditized by Amazon, Microsoft, Google
etc. It makes sense to align the Indian Outsourcing story to the BPRAAS model as BPO and Cloud come together. HCL will find itself on a
very low margin business with Infrastructure services as the big ones like IBM and CSC try to get out of these.

11. 11
What is the difference from AS IS NOW to AS A
SERVICE MODEL
The difference is
• What you Manage
• Price points
• Security (As viewed from DataBreach)
• Privacy (As viewed from use of data)
• Flexibility and reduced work load.
TAKE AWAY and NEW BUSINESS MODEL
As happened with Apple and Nokia, Motorola and Sony Ericsson from 2007 to 2012 . The Indian player which responds with a changed
business model will be like Apple in 2007. What does it mean in practise: Align to the new business Model
THE ROLE CHANGES from being a traditional outsourcer to being an integrator for all dominant as a service compenies which change the
cost model for customers.

12. How do you change?Challengers
•New Challengers
•Google
•Cordys
•IPSoft
•Ebuilder
•AWS
•Concur
•Ariba
•SalesForce.com
TraditionalITServiceProviders
•Traditional IT
Services
Providers
•TCS,Infy,
•Wipro,Cognizant
•IBM,Accenture
•Mindtree etc
ThirdPartyAdvisors
•Third Party
Advisors
•TPI, KPMG,PA
•PWC etc
LawFirms
•Law Firms
•You
•Your
Competitors
Mr Customer
Traditional IT outsourcing Model : Apps and Infra
New IT outsourcing Model As a Servicepay as you go Model
Rodin
Set in Stone
Outsourcing
processes
Law firms
Blind to
Changing
processes
Dinosaurs
In an slow ly
dissappearing
Apps
and
Infratructure world
Infra
Apps
ShiftData
Cloud
Cheetahs
In a fast moving
Dynamic
As A Service Market
TAKE AWAY : A NEW BUSINESS MODEL
Change to an Integrator role with the as a service companies. Two very interesting things start to happen.
Integrator
role

13. Two Interesting things
TAKE AWAY : A NEW BUSINESS MODEL
Change to an Integrator role with the as a service companies. Two very interesting things start to happen.
Information flow on deals starts coming from these companies.
Information positioning as an Integrator happens with the Market.
A white space exists to take the Integrator role and the company which takes this role will lead the pack and start moving to an as a service
model.
By Going from a Traditional role into the Integrator
role, we will reduce the Market size of the IT Services
Market from Existing vendors ( Indian Cos,
Multinational Companies) to 20% of existing IT
services Market and being the top player in this
Market from the Marginal position we have now in
the undifferentiated Market.
If we do not someone else will.

14. Manufa
cturing
Logistic
s
Financia
l
Insuran
ce
Telecom
Retail
Public
Product Vendors
and Non
competing
companies
Third Party
Advisors/analysts/Tec
hnology Partners /I
profile
Law Firms,
Business networks
associations BSCC,
IVA Supply chain
Glocal Companies
• Cognizant
• Accenture
• IBM
Global Companies
• TCS
• Infosys
• Wipro
• Mindtree
Local Companies
• Tieto
• Logica
• Evry
Information from market on Projects
Information to market from Company
Have done it
Have done it
Looking at new
Business Models
Adhoc – Some
Going Bankrupt
Warming up
TAKE AWAY :
The White space of Integrator is free. You manage to increase your foot print across the Market as Stacks start building up.

15. 15
Have you heard the story of the Elephant and six
blind men

16. 16
History repeats: The Cloud, Big Data, SMAC Stack
Each one takes his own view from where he has been in the past
Linkedin
Facebook
Its identity and
sharingGoogle
Enterprise
Its Enterprise
email
Telecoms
companies
Its connectivity
and Access
Ebuilder/Salesfo
rce/Concur
Its business
processes
Outsourcing
companies
We build the
skills to make the
cloud workable
SAS Institute
Its Analytics
IBM,
Accenture,
TCS,
Infosys
Cognizant
And 20 others
TAKE AWAY :
Each sector views the cloud from his legacy and capability. Telcos are trying to get in the game because they own networks.

17. 17
What is cloudified depends on Business Processes
Goods return process
Criticality of application
Expense Report Reporting System
Ticket Booking System
TAKE AWAY :
BPRAAS will grow as vendors seek to stack in different verticals. These challengers are quite small now but will gain in strength as they
start to stack up and the network effect takes place. Traditionally BPRAAS will happen in low value low criticallity areas. But as they stack
and standardize the volumes will grow. Salesforce is an example.

18. 18
The Example of stack of processes is well proven
 The Airline example of Ticketing system enables the
validation of PRAAS.
 Reduces cost .
 Improves flexibility.
 Decision making at Business not IT.
 Do we have a standard process which can be ”STACKED”.
TAKE AWAY :
BPRAAS are common across sectors and do not offer any differentiation the case above was the 4 MUSD SAS contract which Amadeus
took away from CSC. Though it is a core business process of the ticket booking system it was expensive for SAS to maintain a standalone
business process.
Business processes across sectors say Insurance , Banking, Travel, manufacturing Logistics are very similar and offer no differentiation. If
they can be stacked they can be commoditised.

19. 19
What opportunities does this create.
 White Space for TPAs.
 Align Market makers with Advisors.
 A Customer typically wants a process to be catered to.
 White space for someone to evaluate the criterion for
change in service wrt different parameters. Cost,
Flexibility, Service Levels. And start stacking.
 Laws and regulations need to be catered to like privacy
laws and data regulations in EU.
 Some TPAs have started Cloud certifying practices.
TAKE AWAY :
Each Sector will respond to the challenge in a different way. But the IT revenue pie must shrink if the Industry is to move forward.

20. 20
And What can be stacked across customers
Same as bottom Customer
Same as bottom Customer
Same as bottom Customer
TAKE AWAY :
Slowly but steadily stacks will start building up and IT business migrates to the Integration role.

21. Questions
abhijeet.kelkar@geoown.com