At the recent NASSCOM conference, the presentations and conversations were mostly about the downturn and how the industry should cope with it. It was clear that the impact has been unprecedented and few firms have been spared this onslaught. What was particularly concerning was that many CEOs expected the slowdown to last beyond the next two years!
We need concerted efforts along two broad streams to buck the trend and make the most of the downturn – increasing agility and discovering new opportunities.
One of the unique trends over the past year or two has been the increased variability of the external environment in both directions. As an example, gas prices went from $60 per barrel to $140 and back to $40 all in a matter of two years. The dollar, which had weakened considerably against the rupee, suddenly gained 28% against the rupee in under 12 months. In our own case, we saw a growth of 34% last year and we are now looking at less than half that number.
The level of variability is likely to continue in the future. The challenge for companies like us, then, is to respond to a downturn with the same speed and poise as taking advantage of an upturn or a special market opportunity. To illustrate, suppose we expect to make $16 of profits on a planned revenue of $100, we should be equally able to maintain that $16 profit if the revenue drops to $85 or take advantage of some sudden market opportunity and raise revenues to $115. Such variability of demand requires a lot more variability on our delivery and support side than we have today. I’d like ideas from all of you on how we can become far more agile as an enterprise – since this could be a significant competitive advantage for us in the future.
Discovering new opportunities
We know that the opportunities for new solutions and new platforms will grow exponentially as the markets revive. However, we still need to grow in the interim. We have made substantial investments in bringing in new leadership, in UK and US.
Our hypothesis is that there will always be visionaries and early adopters who will embrace new platforms ahead of the curve, and we need the leadership bandwidth to identify and capitalize on these opportunities. We are also expanding into Canada and parts of Europe to discover new opportunities within our existing verticals. I must mention that John and the North American team had a great turn out of prospective customers and partners when we did our Canada launch early February.
We need more ideas from all of you on new approaches to discover these opportunities. For instance, when I addressed Mastekeers in Pune, one person came up with the idea that we could leverage the virtual bench by training them in highly specialized, niche technologies / applications so that we can go after these market opportunities. I’d like our sales teams to figure out whether we have such possibilities within the insurance, wealth management or healthcare vertical – where we can bring in special expertise in some rare technologies / applications. Many more such ideas are required for us to buck the trend and grow faster than the industry in the next year.
These are uncertain times for businesses as well as individuals. Just as enterprises need to go the extra mile to emerge stronger from crises, so do professionals. This is the time for all of us to -- individually and collectively -- reflect on what we can do to make ourselves more relevant in the current context. This is the time for us to go beyond our existing skill sets and acquire new capabilities and knowledge to grow as individuals and professionals.
I invite suggestions and ideas from all of you on one can do to stay relevant and make a difference to themselves, their company and its customers.