The National Association of Software and Services Companies (Nasscom) Vice-Chairman, R. Chandrasekaran, spoke to The Hindu on a range of issues concerning the Indian IT sector as well as the new areas and technologies he saw growth coming from. Edited excerpts from the interview:
What are the new areas that you see growth coming from for the domestic IT sector?
Nasscom, as a part of its Perspective 2020 report, has envisioned that by the year 2020, 80 per cent of the incremental growth will be driven by opportunities outside the current core markets, verticals and customer segments.
Five major technology changes that are expected to open up new opportunities for the industry include smart computing (expected to drive industry-specific solutions), the Software-as-a-Service model (SaaS) is expected to play a dominant role, social technologies (aimed at empowering all elements of an industry’s value chain spanning suppliers, employees, customers, and business partners), mobility (access to anytime, anywhere information), and analytics (real-time intelligence).
Another significant trend that we are witnessing is around buyers of technology. With the expanding role of IT, key stakeholders who influence corporate technology adoption are no longer just the CIOs but CMOs, business units as well as employees. Consumerisation of technology is thus driving a newer segment of buyers.
Products, platforms and IP-based service delivery are also changing the industry business model, driving growth in new opportunity areas and also delivering enhanced value for customers.
What impact will the steep decline in rupee’s value against the dollar will have on the results of Indian IT companies?
A more stable rupee is in the interest of the overall economy. The depreciating rupee might benefit some companies in the short-term, but such volatility is not good for businesses. Also, most large companies following stringent financial management norms with currency hedging will have limited benefit from rupee depreciation.
Do you see clients pushing in for lowering the pricing since Indian companies stand to gain if the rupee stays at current levels?
We do not see any such impact as clients understand that the rupee has been moving in both directions. It is important to have a stable currency for effective long-term planning by companies.
Nasscom had given estimates of hiring of about 1,50,000 people this year. Do you think this is achievable?
If you look at current trends in hiring, there are multiple factors at play. The industry business models are changing with a strong impetus on non-linear growth driven by IP-led solutions and outcome-based pricing. Hiring models are changing from large campus hiring to blended models of campus hiring, just in time hiring, lateral and global hiring.
As regards estimates for hiring for this year are concerned, they are achievable though companies will look for niche skills, domain and soft skills in their future employees.
There have been issues related to on-boarding of freshers. What are your views on this?
The industry follows a staggered model for on-boarding of freshers and is normally spread across 3-4 quarters. We have urged engineering colleges and companies to schedule placements in the middle of seventh or eighth semester of the BE/B.Tech course so that companies have a better estimation of potential demand and students can join companies as early as possible.
Please elaborate on the 10,000 start-ups program and how it is shaping the landscape.
The 10,000 start-ups initiative was launched in April 2013. Since then, we have held various connect programs with start-ups across the country. We recently received 4,000 applications for angel funding and acceleration under the program. The application round threw up some interesting insights into India’s emerging tech entrepreneurship landscape.
Of the total applications received, close to 23 per cent of the applicants were from Bangalore, closely followed by 20 per cent from Delhi NCR. Another interesting trend that came to light was that one in every five applications was filed from smaller towns. Over 70 per cent applications came from applicants under the age of 30 and about 15 per cent of the applicants were women.
We have also recently launched our first Start-up Warehouse at Bangalore which will provide co-working space for start-ups at affordable cost and nurture innovation and collaboration.