V a l u e A d d i t i o n
Body ShoppingOnsiteOffshoreProjectsConsultingIP Focused DevelopmentFigure 1: Phases in the Indian IT Sector
large pool of scientists and engineers,
young populace entering the job market,
Government Policy Reforms
Despite many assertions to the contrary, the sector has receivedsubstantial help from the government both by easing-up on regulations as well as othermeasures (tax-exemptions) which have gone a long way.
The sector has also beneﬁted from the larger opening up of the In-dian economy, for example, de-regulation of the telecom industry, easing of FDI norms,reduction of duties on computers and electronic devices etc.
2.1 Sector Analysis
To better understand the industry at this juncture, we present a “Strengths, Weaknesses, Oppor-tunities and Threats (SWOT) Analysis” of the industry in Figure2. We note from this SWOTanalysis, that the newer opportunities that could come business’s ways are in areas where thecompanies could leapfrog the competition and try to sell their products and services to the “Bot-tom of the Pyramid” consumers in the emerging economies. As pointed out by one of the authorsin , it is imperative that the Indian Software Services move out of doing business convention-ally and start investing resources to build solutions for the next 1 billion consumers therebycreating real value. As shown in Figure1,though the industry has slowly but steadily been mov-
ing up the value chain, we feel that it is still concentrating too much on either process innovationsor incremental innovations, and refusing to take a greater leap of faith.3