Growth Strategies of Successful Indian IT Companies
Dr.G.P.Sudhakar |

Many IT companies are growing in terms of sales, man power, and skills. Indian companies are becoming part of the world reputed IT projects. What are the growth strategies of successful Indian IT companies?

Indian IT companies’ revenues are increasing every year after the US economic slowdown in 2000. Every year Indian IT industry is reaching the software export targets projected by the NASSCOM. Many IT companies are growing in terms of sales, man power, and skills. Indian companies are becoming part of the world reputed IT projects. What are the growth strategies of successful Indian IT companies? How are they getting more business every year in spite of the tough competition from China? How are they becoming profitable? How are they able to retain their employees for long term? How they are able to deliver good quality turn key solutions?

I think people are first assets to any company. It is the human capital which is giving maximum returns to any company. The skilled man power and the education system India is having are the greatest assets. The young engineers in India are very flexible in learning new technologies and they are hunger for technology and technical developments. Indian software engineers welcome new technologies and they accept change, which is an advantage to IT companies. Indian IT companies are heavily investing in training young engineers. As we know technologies change fast. To catch the new technical projects, these companies should be ready with the latest skilled technical man power. Quick learning capabilities of these engineers is also an advantage to these software services firms. Once you have the man power available in the latest technologies, it is easy to bid the projects in those technologies.

One of the growth strategies of Indian IT services firms is acquisitions. In the recent past many Indian IT companies acquired companies in US and Europe which are having the good customer base so that they can get more business from US and Europe. For example, US based NerveWire was acquired by Wipro Technologies. If you look at the global player Cisco, It is best example for Mergers & Acquisitions. It has acquired hundred of companies having related products.

Another growth strategy they are following is diversification strategy. Some IT companies are having plans to enter into biotechnology area. Companies like Satyam, TCS and Wipro are already into Bioinformatics. And many IT companies are following the chain.

One more growth strategy these IT companies are following is geographical diversification. Satyam started their development centre in China and Dubai. Majority of Indian software houses are becoming MNCs by starting their development centers abroad. They are recruiting diversified workforce. Infosys is going to global business schools to recruit their management graduate.

Companies like Infosys and i-Flex are entering into IT products segments with their banking products to the global markets. These IT companies are diversifying their customer base. They are not dependent on single customer.

Also these IT companies are diversifying their services offering to the customer. Earlier they were into maintenance and manpower supply to the western IT customers. These days Indian IT companies are providing offshore facilities, project management, program management, design, and architecture services also. In fact, Infosys is providing complete business solutions to the customer by providing management consulting services through their business consulting venture and IT services through their traditional software business.

According to NASSCOM President, Kiran Karnik’s article titled Dreaming of a new India published in The Times of India, now every global company is having “India Strategy”. The boards of these global players are having the India specific strategies.

Now let us see other side of the spectrum. According to the article published in recent BusinessWeek, 16 Jan 2006 Issue, SUBCONTINENTAL DRIFT written by Nandini Lakshman, there are around 30,000 foreign workers in Indian IT and ITES companies working in India. This number is triple the number of foreigners in India which is two years ago. People from European countries are coming and working in Indian IT enabled services companies in Metro areas. Majority of them are language experts in Spanish, Finish, French, and German. Many foreign program and business managers of global IT companies like IBM are working in India. Indian IT industry is attracting many foreigners to come and work here.

Mumbai based Mastek, is part of the biggest IT program of UK, which is NHS computerization in UK. Mastek is taking care of providing offshore facilities for NHS. It is working along with British Telecom for NHS in UK.

Roger L. Martin, Dean of Rotman School of Management at the University of Toronto expressed his views in his BusineesWeek articleWhat Innovation Advantage?, India and China are going to get competitive advantage over North America in design and Innovation in the coming years. He has visited TCS, Satyam and ICICI and said “Chinese and Indian companies are not leaving design to the North Americans”.

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About the Author:

The author has 10 years experience in IT industry. He works as freelance consultant in IT industry. He has Bachelor of Science, Master of Computer Applications, Master of Technology and Executive MBA from India. He worked in USA, UK, Ireland, Finland and India as Software Consultant. He worked as employee or Consultant to companies such as IBM, SIEMENS, Interwoven, Wipro Technologies, Citicorp, Nokia, Salomon Smith Barney, SIAC, DSET Corporation, IONA Technologies, Birla-Horizons International, and PCL Mindware. He has few publications in Management. His articles were published in The Hindu, Indian Management, Businessgyan, Business & Management, The Global Educator, Computers Today and CSI Communications. He has interests in both technology and management.