Volume 14, Number 2 Article by Subramanya Sharma, Jai Krishna Ramesh P, Ravikiran A June, 2002
Indian Software Industry: An Operations Perspective :
Exports became the core focus of Indian software companies sometime around the late 1980s and early 90s, with many large software companies setting up shop in India as subsidiaries. During this period, 90% of India?s software revenue came from the export of know-how in the form of programmers going abroad to provide onsite services to clients. But over the years, the industry has tried to reduce the relevance of body shopping, and has moved up the ladder into code maintenance, offshore development centres, turnkey projects, providing end-to-end solutions and R&D partnering with big multinational firms. However, the industry has by and large failed to implement critical areas for the client. It is largely involved in the top layers like application development, and has been able to get into the core only in a very few instances.
Indian industry has operated for years without serious time pressures or pressure to improve productivity or shorten life cycles. But with the industry aspiring to build global organisations, productivity has become a key issue, particularly in software markets. The prescription of the stalwarts in the industry is to move up the value chain, into high value added activities like products, solutions and consulting. But is the industry ready to make this leap? And if not, what needs to be done? In an award winning student essay, Subramanya Sharma, Jai Krishna Ramesh P and Ravikiran A seek answers to these questions through a survey of 65 software professionals. The issues covered include the sustainability of low-cost leadership, locking in customers, tackling rising costs, current state of delivery to the customer, adequacy of the requirements management strategy, industry capability in products and solutions, aligning organisational goals, leveraging of knowledge in organisations and improving productivity. The findings indicate that survival will depend on value combined with cost competitiveness, and that the industry will have to create new business opportunities for itself. The authors also present Moksha Path, a framework detailing the mission, objectives and levers that may be used by an organisation to achieve operational excellence.
Reprint No 02202
