Person Interviewed
Name: Rashmi Gupta
Designation: Senior Project Manager
Company: CSC, Noida
Experience: 11 years
What strategy should be followed by the new start ups in IT sector?
The new start ups in IT sector should first of all do the market study. As the current market is saturating and declining. Thus to survive in this sector requires lots of cost cutting at the employees end as well as the location. The company has to adopt low cost strategy. The employer should search for the location where the cost of the land and setting up the infrastructure does not cost too much. They should locate the industry in small cities to avail the location benefit. The employees should be the people who don’t expect hefty pay packages. Nowadays IT companies are also picking up the BCom and BSc degree holders also to cut the money spent on salaries. The new start ups should also employ people from the BSc Physics and BCA graduates at the entry level and should train them in the language required for the project. The project manager should be some experienced person who has worked in some big IT industry so that he can handle the intricacies of the project. The projects bagged should be international as well as domestic. The emphasis should be on capturing the domestic market as well because of the declining dollar value.
What is the best strategy that a company should follow in IT in today’s competitive world?
The IT sector is really down nowadays so the company should focus on building strong bond with the customers. They should emphasize on long term relationship with the customers. They should leverage the existing relationships for new projects. The relationship should be built on trust and quality. They should make their customers believe that the amount they are paying for the project is really value for money. They will get the quality deliveries on time.
What do you think the companies nowadays really follow the concept of core competencies?
The new start ups in IT sector should first of all do the market study. As the current market is saturating and declining. Thus to survive in this sector requires lots of cost cutting at the employees end as well as the location. The company has to adopt low cost strategy. The employer should search for the location where the cost of the land and setting up the infrastructure does not cost too much. They should locate the industry in small cities to avail the location benefit. The employees should be the people who don’t expect hefty pay packages. Nowadays IT companies are also picking up the BCom and BSc degree holders also to cut the money spent on salaries. The new start ups should also employ people from the BSc Physics and BCA graduates at the entry level and should train them in the language required for the project. The project manager should be some experienced person who has worked in some big IT industry so that he can handle the intricacies of the project. The projects bagged should be international as well as domestic. The emphasis should be on capturing the domestic market as well because of the declining dollar value.
What is the best strategy that a company should follow in IT in today’s competitive world?
The IT sector is really down nowadays so the company should focus on building strong bond with the customers. They should emphasize on long term relationship with the customers. They should leverage the existing relationships for new projects. The relationship should be built on trust and quality. They should make their customers believe that the amount they are paying for the project is really value for money. They will get the quality deliveries on time.
What do you think the companies nowadays really follow the concept of core competencies?
They really venture only in the field of their core competencies?
In the IT industry the companies generally venture into their own field of expertise that is in their core competency. For example CSC core competency is support. CSC major projects are of support which makes it among the top consulting companies in IT. The BPO companies generally venture into in this field if they have core competency in customer relationship. Moreover it is really appropriate for a company to enter the market with their core competency to succeed in this competitive world.
Do you feel that long term strategies can be made in the IT Company in today’s dynamic world?
Today’s world is really dynamic. The IT sector was on such a boom. The Indian GDP was increasing because of boom in outsourcing Information technology and IT-enabled services. The death of this industry is far from anyone's horizon. But the market is dying slowly because of rising wages. So long term strategy is very difficult to make. The strategy has to keep changing according to the market.
In the IT industry the companies generally venture into their own field of expertise that is in their core competency. For example CSC core competency is support. CSC major projects are of support which makes it among the top consulting companies in IT. The BPO companies generally venture into in this field if they have core competency in customer relationship. Moreover it is really appropriate for a company to enter the market with their core competency to succeed in this competitive world.
Do you feel that long term strategies can be made in the IT Company in today’s dynamic world?
Today’s world is really dynamic. The IT sector was on such a boom. The Indian GDP was increasing because of boom in outsourcing Information technology and IT-enabled services. The death of this industry is far from anyone's horizon. But the market is dying slowly because of rising wages. So long term strategy is very difficult to make. The strategy has to keep changing according to the market.
5 comments:
It's nice to see another great startup of a blog. Prove me wrong by continuing it and updating it on a regular basis.
@vivek : thank you for the encouragement. 2 new articles have been updated. Hopefully our readers will like them and give their feedbacks.
Nice contribution. Some of my thoughts.
I think the need of hour is to create value for the products delivered. If customer is convinced that they are getting value for the price, they do not mind paying higher prices. Indian IT should come out from Cost advantage to Value advantage as we are maturing - the sooner it is sooner the dependency of cost would go away. Startups should venture into Niche areas e.g. development of Commodity Market Software, Creating KPOs than BPOs to get better price, margins for the value they are offering.
Ashish Singla, EMP 07 Oct
@Ash: Agreed whole-heartedly. Low cost strategy can never be a permanent stratgey. A maturing industry, new competitors and disruptive technologies can change the environment drastically. This is being see in the Indian IT space. Countries in Eastern Europe and South East Asia are able to match India in costs. Also the salaries of Indian IT professionals are on the rise. Also we were never really very high on quality or innovation, so that position is not known to us. English continues to be our strength, but the pace at which Chinese are adpoting the language does not bode well for us.
We had a gentleman from Israel who visited our college. He said "If you do not start your own company in Israel, people ask if anything is wrong with you". The case in our country is the opposite.
I rest my case.
Well everybody has his/her own views. As per my view I do not agree with Rashmi at all. A low cost strategy for a new start up would not take it anywhere rather it should follow a strategy of building up products or services which are completely new/innovative. This would help it overcome the cut throat competition in the industry. Low cost advantage that Indian IT boasts of right now will be a thing of the past in the days to come when small countries like Israel, Austria etc. wh budding IT talent available at cheap rates and countries like China and Phillipines having a large population of english speaking people will give the toughest competition. It's a time when the IT industry has to think long term with many challenges facing it right ahead, factors such as weakening dollar, intense competition, anti outsourcing cries etc. Innovation may be the best bet that IT industry can think of right now so money has to pur in on R&D, talent acquisiton and devloping this talent.
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