Indian IT firms don’t match up to global expectations. They need to either shape-up or ship-out

Companies like Cargill, TargCorp have an advice for the Indian IT firms. World’s largest buyer of technology believes, it’s high time Indian IT firms adapt to newer technology.

At an exclusive session with ET, the technology heads of several global companies said Indian IT firms need to overhaul their businesses and strengthen in areas such as digital, analytics and cloud, particularly as many of the clients are building their own capabilities in advanced computing.

"If you see, areas such as digitisation are largely not being outsourced right now," Aindam Sen, senior vice president at Schneider Electric India told the ET.

"Over a period of time, over 8-10 years, GICs (global in-house centres of companies) have built leadership maturity, credibility within the organization and high level of business value... it is this that has changed the game," Nitin Seth, country head at Fidelity Worldwide Investment told the ET during the session.

American retailer Target, for example, outsourced projects to large Indian software firms such as TCS and Infosys for nearly a decade. Now, the 113-year-old firm is building more technology capability at its captive centre in India than ever before.

Last year, the Minneapolis-based company launched a corporate accelerator program to tap into India's emerging startup ecosystem for talent and technology solutions that it hopes will help it survive the battle against new-age competitors such as Walmart and Amazon.

"For Indian tech vendors, rather than coming to us and saying this is what we can do, they should come to us and say these are your business problems and we have these solutions for you. Also, Indian IT firms should not view captives as threats, but should view them more as partners," said Narayan Ram, managing director of Lowe's India, the domestic arm of the American home improvement chain.

American retailer Target, for example, outsourced projects to large Indian software firms such as TCS and Infosys for nearly a decade. Now, the 113-year-old firm is building more technology capability at its captive centre in India than ever before.

Last year, the Minneapolis-based company launched a corporate accelerator program to tap into India's emerging startup ecosystem for talent and technology solutions that it hopes will help it survive the battle against new-age competitors such as Walmart and Amazon.

"For Indian tech vendors, rather than coming to us and saying this is what we can do, they should come to us and say these are your business problems and we have these solutions for you. Also, Indian IT firms should not view captives as threats, but should view them more as partners," said Narayan Ram, managing director of Lowe's India, the domestic arm of the American home improvement chain.

As per the news report, traditional Indian software services firms are struggling to make the transition towards newer business models that are very different from the classic 'pyramid model', where revenue growth was directly linked to manpower addition. Whereas over the years, companies' in-house technology centres have evolved to more than just vendor-management centres.

(Image: Reuters)