Indian IT should reflect & work on future strategy, says TechM's Gurnani

India’s USD 154 billion IT industry is going to through possibly its toughest moments, as automation, cloud and digital technologies disrupt the traditional outsourcing model. With growth becoming hard to find, Tech Mahindra’s CEO CP Gurnani believes that it is best to pause and reflect on strategies instead of chasing quarterly numbers. In an exclusive interview with Moneycontrol, Gurnani said: “I would like all of us to pause. Let us reflect and decide what our strategies are going to be. That is our strategy and luckily our Board is with us on that."

The company has identified digital transformation as its go-to-market strategy while it looks to re-imagine life beyond the traditional outsourcing model.

India’s outsourcing industry has been struggling to meet its modest dollar revenue guidance for the last 18 months as customers look to drive down costs and deploy newer technologies. This possibly explains why industry body Nasscom refused to give its annual growth guidance for the current year. Clearly, business models are changing as is business consumption. However, Gurnani believes that technology consumption is increasing and the company’s 13 verticals are seeing an increase in consumption. He cautions that these are not always in traditional IT and the industry needs to reorient itself.

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The world is going towards IoT (internet of things) and digital security. These two areas mean convergence of enterprise and telecom. Tech Mahindra is at an interesting point and it intends to continue to marry the communication and IT businesses.

What is driving this growth is obviously digital as organisations focus on such platforms. Says Gurnani, "It doesn’t matter if you are a medical company or a retail or manufacturing company. The question everyone is asking is: What is the enterprise of the future and what is the factory of the future? If you participate in that, there are opportunities."

But gone are the days of large deal sizes. In general, long-term outsourcing deals in the range of USD 100 million and even USD 50 million are few. The deal pipelines are strong but decision-making slows down each time there is a geopolitical event. At this point, decision-making is slow acknowledges Gurnani.

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