Recently I read an article in McKinsey quaterly site discussing the future of Indian IT Industry. According to the study done by McKinsey, India can continue to enjoy the upper hand in IT sector only if the Indian companies are ready to be innovative. Most of the Indian IT service providers are involved in maintenance and development projects and very few of them focus on Innovation. Even in the current portfolio they are facing increasing competition from big MNC's like IBM, Accenture, HP - companies which are increasing thier foothold in India. Financial year ending March 2010 would give fresh opportunities because contracts of many big ticket clients are going to expire and MNC's are ready to poach such clients at lower rate than being offered by Indian IT companies. In such a scenario Indian IT companies would have to be innovative similar to what say Apple has done. The decade ending 2010 also ended the supremacy of Microsoft, the two big software giants Apple & Google emerged as leaders banking on their innovative products and marketing strategies.
India is also facing growing challenge presented by small countries like countries in South African continent, Phillipines etc. These countries are now promoting the IT sector in big way. Many BPOs are now flourishing in these small countries because of tax holidays, competitive pricing and sound infrastructure. The Indian Government will have to look at matching the benefits provided by such small countries. The infrastruture needs to ramped up to match the levels provided by these countries. China which was known for hardware exports is strengthning its position in software markets thanks to their improved education system. Till now China was a laggard in this field because of the langugage issues. But Chinese government was quick to realize this and they took relevant steps to overcome this problem. English was introduced as mandatory subject in their education system leading to growth in number of engineers who know English.
It's high time that Indian government takes precise steps for future of its IT industry. The thinking of people will have to changed. The education system will have to be changed to focus on developing creative solutions to complex problems rather than learning the existing solutions. We will have to also focus on quality rather than quantity. Once the creative thinking enters the blood of Indian people, definitely things will change and we would strengthen our dwindling position once again.
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