The Great It Leap Forward
Indian IT industry needs to transform from being just cost competitive to becoming the destination for cutting-edge research
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What will the information technology (IT) industry in India look like 30 years from now, when the country completes 100 years of independence? In the world of technology, 2047 seems like light years away, especially considering that technology innovation and disruption are occurring with unprecedented speed and frequency, and at a greater scale than ever before, thanks to digital technologies.
While mainframes and personal computers took 50-plus years to mature and reach their peaks, the maturity and adoption cycles for new technologies like big data with machine learning, and artificial intelligence (AI) are much shorter. While the Web took 40 years, the Internet of Things (IoT) and smart machines, even as they are evolving, reached the same level of maturity in just 10-15 years. So instead of predicting what exactly the IT industry in India will be like in 30 years, let us focus on the fundamental building blocks that should power the industry over these next 30 years.
The IT industry has been India’s sunshine sector for about three decades now and helped put India firmly on the global map as an emerging economic power. Today it is a $140 billion industry powered by a predominantly young workforce. But there is a critical need to recognise that what got the Indian IT industry to its leadership today cannot take it forward much further. The factors which enabled the rise and growth of this industry since the 1980s — an army of software engineers, cost competitiveness and offshore technology delivery services at scale — do not figure in the key elements that will define the industry in the future. The future of IT services will not be marked by industrialised service delivery at low-cost, but by innovation, R&D and expertise in the new IT landscape.
So, the great leap that the Indian IT industry needs to make in the immediate few decades is to transform from being the leader in offering industrialised, cost-competitive technology delivery to being the global IT destination for cutting-edge research, development and innovation with expert talent in technologies like big data, AI, machine learning, IoT, blockchain, cyber security, quantum computing, and so on. There are three critical dimensions to focus on in this transformation journey: industry value, talent rotation, and domestic market inspiration.
Almost all industries have been disrupted by the digital revolution and are reinventing their business models. Enterprises will increasingly seek technology partners who understand their business inside and out, and can provide technology solutions that evolve with the ever-changing and complex macroeconomic environment, mirroring the speed of change itself. Hence, the first key area of focus is the new value that the Indian IT services industry must offer, i.e., the strategic integration of business and technology expertise. Technology companies need to reinvent themselves as partners and collaborators for clients and develop capability among the workforce to offer technology and industry expertise at the highest level. This will be increasingly important as other industries in turn develop technology as a core competency and reinvent themselves as software businesses.
India’s edge in technology talent today will be challenged by the fast-changing technology landscape. Retaining this edge in talent will require strategic and focused investment in reskilling the IT workforce on a massive scale to keep up with the blistering pace of innovation. Research by Accenture shows that AI could help countries double their annual economic growth rates by 2035 by changing the nature of work we do and how we do it. So in the future, technologies like IoT, AI, machine learning, big data, deep data, biometrics, quantum computing, augmented and virtual reality, and so on will mature and become mainstream, defining how the world lives, works and conducts business. The opportunity to lead in such an era will depend on how economies and organisations invest in mastering skills in these areas.
Rotation of talent is also a critical area for the IT industry as automation, AI and robotics are expected to increasingly take on many repetitive and task-oriented jobs that humans perform today, and technology will eventually create a myriad new jobs and roles that we haven’t yet imagined. Another hugely exciting area for India in the next few decades is how its domestic market consumes technology.
Despite the economic advances of the last 70 years, India finds itself in a unique position where the last mile reach of basic citizen privileges like electricity and sanitation are still being met, and services like affordable healthcare and education for all face daunting implementation challenges. Add to that the very diverse profile of India where we have plurality right from weather to culture, and we are talking about a complex environment and a population that is expected to increasingly adopt technology and become digital in the next few decades. This is where innovation — in making technology user-friendly, affordable and impactful — will play a crucial role in enabling the large-scale adoption of digital technologies and aid in the country’s economic development.
While India may not be a large buyer of technology today compared to mature markets like the US or Europe, the economic development curve that the country will go through in the next few decades will augur well for the design and consumption of technology, and we can expect to see unique innovations coming from India which may well set the trend for other markets. In effect, over the next few decades, India itself could be a key part of the answer that the Indian IT industry is looking for in terms of new frontiers of growth. India must embrace new technologies and aspire to lead in the integration of technology and business.
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