New technology companies and open source platforms may emerge to provide competition to incumbent information technology (IT) companies, management consulting firm Bain & Co has said.
This may not augur well for the $167-billion Indian IT-business process management (BPM) industry, which accounts for 55% of the global outsourcing market and has been a predominant supplier of software implementation and maintenance to global businesses at a time when the local players are gearing up to embrace digital faster owing to changing client demand.
With the rise of technologies such as cloud computing, artificial intelligence and machine learning, demand is growing for new technology-based services. For example, banking and financial services companies are taking data analytics-driven decisions.
Chris Brahm, partner, Bain & Co said the banking, financial services and insurance or BFSI sector is seeing a disruption over the possibility of blockchain technology replacing the current infrastructure.
“Both software services companies and technology companies will play big roles and I think open source will have a key role and that has been shaping the internet,” Brahm told in an interview. “Some providers are very well positioned to do that. The technology industry is absolutely going to be the centre of digitisation and it is going to be new companies.”
He said many technology solutions for the future organisations are not yet available. While Accenture is aggressively driving digital transformation and bringing startups on board to have new-age solutions, its Indian peers are seeing a slow-paced shift to have the right digital technology-based services.
“Not all the solutions have been brought into the market. There are big questions in financial services. Will blockchain start to replace significant areas of the existing infrastructure architecture? Maybe that is a very possible scenario, but there are other scenarios as well,” said Brahm, who is based in San Francisco. “The clearest thing that has to change is that the legacy business models are too highpriced and too low service, and digital and analytics required to migrate to a new business offer much higher value at much lower cost.
This may not augur well for the $167-billion Indian IT-business process management (BPM) industry, which accounts for 55% of the global outsourcing market and has been a predominant supplier of software implementation and maintenance to global businesses at a time when the local players are gearing up to embrace digital faster owing to changing client demand.
The Indian technology service sector includes companies such as TCS, Infosys, Cognizant, Wipro, IBM, Accenture and HCL Technologies.
With the rise of technologies such as cloud computing, artificial intelligence and machine learning, demand is growing for new technology-based services. For example, banking and financial services companies are taking data analytics-driven decisions.
Chris Brahm, partner, Bain & Co said the banking, financial services and insurance or BFSI sector is seeing a disruption over the possibility of blockchain technology replacing the current infrastructure.
“Both software services companies and technology companies will play big roles and I think open source will have a key role and that has been shaping the internet,” Brahm told in an interview. “Some providers are very well positioned to do that. The technology industry is absolutely going to be the centre of digitisation and it is going to be new companies.”
Discover the stories of your interest
He said many technology solutions for the future organisations are not yet available. While Accenture is aggressively driving digital transformation and bringing startups on board to have new-age solutions, its Indian peers are seeing a slow-paced shift to have the right digital technology-based services.
“Not all the solutions have been brought into the market. There are big questions in financial services. Will blockchain start to replace significant areas of the existing infrastructure architecture? Maybe that is a very possible scenario, but there are other scenarios as well,” said Brahm, who is based in San Francisco. “The clearest thing that has to change is that the legacy business models are too highpriced and too low service, and digital and analytics required to migrate to a new business offer much higher value at much lower cost.
Get Unlimited Access to The Economic Times
