'I think the IT market is very global' ‎(The Hindu - Java Training Courses)

 Cognizant has maintained its growth edge in the industry by posting a 33 per cent year-on-year growth in a volatile and sluggish global economy. R. Chandrasekaran, Group Chief Executive (Technology and Operations), Cognizant, speaks to Shanthi Kannan on the Indian IT industry and the challenges facing it in the evolving global context.

Nasscom says to achieve $100 billion exports, the entire IT industry has to grow and not just the top five. What is your take on this?

The industry will achieve $100 billion in the current year. There has been contribution from the SMEs (small and medium enterprises) also. The challenge, however, is to reach the 2020 vision of $225 billion, where everyone will have to pitch in. Nearly 80 per cent of the incremental revenue will come from newer geographies, business models and customer segments. What was good in the past will not hold good in the future. Customer services along with the cost will take newer dimensions. This will lead to greater deal of innovations in IT industry. Newer areas such as mobility, enterprises analytical and cloud will open up newer opportunities for small and medium enterprises. Consciously, Nasscom and the government have been trying to encourage SMEs to be successful in their businesses.

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How do you see the IT industry growing in India?

Nasscom has projected that the industry will achieve the 2020 vision of $225 billion. Though there might be minor variations, the industry is well on track to achieve this.

As far as large, medium and small companies are concerned, today, customers are expecting lot more value from the service providers. To sustain in the market, one will have to provide unique set of values and capabilities.

As far as verticals are concerned, certain sectors will outgrow the others. Healthcare and BFSI (banking financial services and insurance) verticals will open up newer opportunities as these sectors are under various pressures such as cost, leveraging technology and newer regulatory issues. One should also see how other untapped verticals such as media, information and entertainment take to offshore outsourcing.

When it comes to services, whether IT or BPO (business process outsourcing), increasingly people are not looking at silos (storage towers). They want synergies across silos. So, it is not enough to have one single capability. One should provide a combination of both IT and BPO. It is a fact that the BPO business of any technology company has grown faster than the pure-play BPOs.

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Given the political and economic situations, some say that the U.S. is not the market of tomorrow. There are others who still feel it is the market for IT. What is your view?

I think the IT market is very global. However, the U.S. will continue to play an important role in terms of business opportunities. But with the given economic activities happening on the other side of the world — China, India and other Asia Pacific regions — there are plenty of opportunities for the industry to tap. Certainly, the industry is far more global today than in the past. Though there is political pressure in the U.S., the value propositions provided by the Indian IT companies are competitive. It is difficult for anybody to just ignore.

Will the IT industry in India be a manpower-oriented sector or will automation take over it eventually?

IT industry is a service industry and will have to depend on human talent. But the industry will have to be lot smarter in the way it delivers the services. Companies such as Cognizant are focusing on building “non-linear revenue base model” (direct correlation between revenue and headcounts). It wants to create an IP and use the same to deliver services against the outcome-based business model. So, Cognizant will get paid, based on the business outcome that it delivers to its clients.

The industry will continue to hire in large numbers but the type of work the people do will change. They will be working on lot more innovations and developing newer platforms.

What is the role of mobile phones in the IT industry?

Mobile phones are becoming smarter and there might come a day when mobility services will replace desktops. It is going to be an important part of the business in future. With the growth of mobility services, the gap between customer technology and enterprise technology will be narrowed.

Today, mobility services play an important role in all verticals. In healthcare, for example, there are a number of exciting areas where mobile phone services can be applied. Electronic medical record and health-related information can be carried in a mobile phone. Similarly, telemedicine is catching up in a big way. It is evident that technology will lead the business of tomorrow.

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Why is the healthcare segment showing an increasing growth?

Healthcare sector historically did not leverage technology. But now in order to improve healthcare's operational and service levels to its customers, the need for leveraging the technology has increased. At the same time, this sector has been undergoing lot of changes, both regulatory and cost-wise, which also need to be addressed through technology.

Though healthcare is the most regulated industry, the reforms keep coming from time to time. Organisations need to change the system to stay in compliance with the regulatory changes. Today, the IT industry is working on ICD-10 (International Statistical Classification of Diseases and Related Health Problems, commonly known as ICD). The ICD-10 implementation represents a huge overhaul of the medical coding scheme. Most healthcare stakeholders, including health insurers, hospitals, pharmacies, medical device manufacturers, and researchers, will face significant technical and operational challenges as they revisit systems and reconsider underlying business logic and processes that rely on ICD-9 codes. All of this will have to be done in time to meet the compliance date of October 1, 2013.

The Obama Government has been advocating electronic health records. Digitalisation of medical records will throw open more opportunities. There is also a fundamental shift happening in the U.S., wherein a common man is moving from group insurance to individual insurance. Insurance is going in the retail way from B2B to B2C.

So, the regulatory requirements will throw open lots of opportunities. The global healthcare spend is estimated at $4-5 trillion. The global pharmaceuticals market is estimated at $967 billion as per Frost and Sullivan.  Java Training Courses