YourStory Exclusive:Som Mittal, President, NASSCOM on Trends,Future and estimate for FY2011
Mr. Som Mittal spoke at a Press Meet in Mumbai today on the upcoming NASSCOM Leadership Forum 2011. He spoke on the decade that was, estimate for the FY2011, drivers that will steer the coming decade and what to expect from the fiscal year.
YourStory brings to you an excerpt of the talk.
On the decade that was…
Today this industry has become a forerunner, we have attracted investments which account for 10% of India`s total FDI. There have been 700+ deals that have happened with $8bn invested in one way or the other. Our companies are emerging as Global Multinationals, since the definitions are changing of what is a Global Multinational, i would say when you start operating in 70+ countries then you are a Multinational yourself. We can call it as an Indian Multinational. We now operate in 52 countries, 200 cities, 400 delivery centers, every day the centers are increasing. There are over 10 companies listed on overseas stock exchanges; now we have 400 of the Fortune 500 companies. We have added tremendous value to our local ecosystem development. We have over 3% of foreign nationals employed with us today which to me are signs of becoming truly global. In the year, FY09 we have managed $25-30bn savings in global economies. This is just about cost efficiency. Let’s not forget we have become a global hub for Engineering and Research Development( a very important aspect in the growth of any industry).; We have world’s sixth largest software corporations employing 20% of workforce in India. COST will always be a good driver but we have gone beyond it today.
On the performance of various sectors...
If you want to grow globally, it has to be both organically and inorganically. Last year there were talks of doom, moods were sober and we saw the lowest growth ever of 5.5%, but before we knew there were talks of Green Shoots, then it became Yellow and before we knew it had become Saffron. Today we can see an 18.7% Annualized Growth.
I believe there were two key things that the industry did to change the growth story:
- This industry restructured itself – Efficiency, Internal Review and Getting new services
- Tried to transform to the likes of the customers
On what is going to drive this industry –
It’s all about what the world will have to do with less. Demographic Shifts will fuel the growth of new sectors, Social, environmental, and technology trends will create unseen opportunities. Carbon Credit, in a country like India will have to become imperative beyond country negotiations and climate. The addressable market itself will grow up by 3 times because of the changes that are happening. Interestingly 80% of incremental growth will be driven by opportunities outside the core markets. Many of the new opportunities come from new verticals and new markets. It is for us to tap the new opportunities effectively. Other interesting factors to note include:
- The exports component of the Indian industry is expected to expand three-fold and reach USD 175 billion in revenues by 2020
- The domestic component will grow four fold to USD 50 billion
- IT to play a significant role in transformational agenda of India
The advantage for us as Indians is - we are adopters of new technology since it has not penetrated yet in India. It is easier to adopt than change what is pre-existing. The success in the future will be driven by the new drivers which have to be identified. Companies, customers and countries will have to reinvent business solutions to create a bigger success story. We at NASSOM feel that it’s not our job to follow the market but to create a market. We have done that in the past and in the next decade too we will help carve a new market.
On the impact we hope to create …
The impact of these new drivers of growth will result in greater efficiencies, increased automation, healthcare, citizen services. Automation– it would mean we will take some of the work that we are doing today and then we will automate it. If we take Asia without Japan, the size of the market will grow more than that of Europe. We would want to become the HUB for technology and services which we will provide first to the Indian market then overseas. Once connectivity will penetrate to villages and then it will be innovation that will drive the market. We will need new formats. Healthcare can no longer be serviced they were in the past. In India, we have to service those who are subserviced as well. India based companies are introducing Cloud services globally. If we add more customers to our base the Cloud will only increase our services so rather than protecting it we should adopt it. Cloud in the next thing we will see. Global Collaboration is something that is happening across verticals, services and geographies. E-Solutions are slowly bridging the gap between smaller companies integrated with larger companies. Nano was the biggest example of co-creation and collaboration. Soon a new ecosystem between business, society and government will emerge. Society will be a key driver.
Reported by Samridhi Sharma. Write to us at firstname.lastname@example.org