Software and IT Services in India

Software and IT Services in India

            
 
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Case Details:

Case Code : BREP009
Case Length : 15 Pages
Period : 1998-2004
Pub Date : 2004
Teaching Note :Not Available
Organization : -
Industry : Software and IT Services
Countries : India

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.



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"India has been in the forefront of the outsourcing revolution globally and has today become the most preferred destination for businesses worldwide to meet their outsourcing needs. Besides cost advantages, factors such as innovation, quality, productivity, total cost of ownership, suitability and customization are helping India maintain its lead in the global IT industry."1

- Kiran Karnik, President, NASSCOM.

Introduction

According to the National Association of Software and Services Companies (NASSCOM)2, from 1997 to 2002, the Indian Information Technology (IT) industry's revenues grew by 120% from $5 bn to $11 bn. During this period, several IT companies in India achieved global recognition as end-to-end IT solutions providers, ranging from basic software development to IT consultancy. Prominent names in the industry included Tata Consultancy Services (TCS), Infosys Technologies, Wipro, Satyam Computer Services and HCL Technologies. The industry also comprised relatively smaller IT companies such as i-flex Technologies and Ramco Systems (Ramco), which specialized in niche IT segments like banking and manufacturing software.

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The IT industry grew rapidly following the liberalization of the Indian economy in 1991. It made a small beginning with companies providing enterprise software3. Indian software companies started by undertaking off-shore assignments and were soon offering value-added services.

Slowly, the companies graduated into making their own products, both for domestic needs and markets abroad Several companies, primarily in the US, decided to outsource coding assignments to India in their bid to reduce manpower costs.

They were attracted by the English-speaking workforce in India, who could write programs at a much cheaper rate compared to those in their home country.

During the initial years, the work done by the Indian companies was confined to writing proprietary software for foreign companies. However, as their operations expanded, they enhanced their project management capabilities.

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1] "Indian IT industry to touch $15 bn next year," www.ciol.com, February 03, 2004.

2] NASSCOM is the apex organization for IT software and service organizations in India. Formed in 1988, NASSCOM's objective is to act as a catalyst for the growth of the IT industry in India. NASSCOM is a non-profit organization with over 800 member companies that collectively contribute to more than 95 per cent of the revenues of the Indian software industry.

3] An integrated software that facilitates the flow of information among all processes of an organization's supply chain.

 

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