Converting an IT horizontal into an industry vertical

Leveraging IT is not just for outsourcing vendors in India. Other Industries are fast catching up. I would say it's a fantastic opportunity for sectors that are not particularly doing well, Real Estate and Construction for example.

HCC is a Bombay based infrastructure and construction major in India. The industry is going thro some real rough weather but that doesn't seem to have influenced their business propensities. Though operational departments have been sagging, the IT department of the company has warmed up to the situation and is now pitching in with its own might of experience gained so far. It is trying to develop as an end-to-end IT solutions service provider for the infrastructure industry. According to Satish Pendse, CIO, initially, the services sought to be provided by the upstart could be SAP implementation, GPS-based tracking devices, multiple-packaged application implementations, and end-to-end services going forward.

Innovation does not just mean feature addition or product enhancement. It can also me converting a horizontal into a vertical.

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IT has local grounds to cover

Ever noticed the long gaps (yeah, more than a day is long enough) between posts in this blog? I started this blog to write about latest tech trends and potential business ideas. But the pace of innovation in technology itself has become too slow to write anything about. All one could find is incremental innovation – nothing generic or earth shaking. So I chose not to fill cyberspace with mundane muck. Not for me all that Microsoft-Yahoo soap opera that stuffs every tech blog.

I’ve been writing about the need for Indian IT vendors to focus on local customers. The Rupee appreciation has made it all the more necessary and some vendors at least threw open some divisions as well. But there has been no customer survey or market size assessment done officially. Now I found one here. There is no new business idea. But certainly it’s a kicker for IT CMOs that are not so sanguine about local markets.

It says “The use of information technology (IT) by businesses increases profits by 30 per cent and profitability by 3 per cent, says a study by the India Development Fund (IDF), Microsoft and LexisNexis Butterworths India…..Despite India's IT export prowess, there is an alarmingly low internal consumption of technology. A case in point is that about 80 per cent of software produced in the country is towards export. We have discovered that despite documented evidence proving the benefits of technology, investment in manufacturing and domestic businesses still have low adoption rates.”

Now with dollar demand going up because of fatter oil bills, the Rupee has slipped to new lows (Rs.40.98 to the $$). Time for India’s IT vendors to boost their revenues from domestic market. Hope their priorities are in right alignment - their pricing, in particular. You can't expect to sell well-worn packaged software, depreciated over decades for $300 to an Indian SME. [Good that Microsoft is one of the sponsors of that study]. Here they won't pay more than $15 for such stuff because they have a better choice - turn to an assembler and get it all preloaded :)

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