Intelligent Sourcing (and Professional Outsourcing Magazine before it) has been saying for a while that the Indian IT industry could – just could, mind you – be heading for trouble. Our idea was that if you take an industry that is dependent on offering cheaper person-power but allow for the fact that automated systems are even cheaper there is only one logical conclusion.
This writer from the Huffington Post, Srama Mitra, expressed much the same thing but she did so in 2008 so perhaps you could argue she’s been rather further-sighted than us. She reports in the linked article that she had hate mail at the time as well.
However, she’s not so much changed her mind as started to see other possibilities following reactions from the Indian tech industry.
The main plank of her original argument wasn’t actually the commoditisation of IT as ours was. Mitra took this into account but couldn’t see any sign of the country developing an alternative, which was where she had a serious problem. Carrying out someone else’s tasks cheaply is one thing but there was no Plan B.
The change she has detected is that Indian companies are now developing their own intellectual property (IP). This may have started off as developing other people’s ideas further but it’s moved further since then.
She forecasts a number of things, including entrepreneurs moving into the country with further ideas about creating new stuff (as distinct from transacting existing items) and building on those skills. This would, if done at scale, address the issue around pricing completely as by definition nobody is doing “your” systems more cheaply than you do.
Traditional outsourcing to India is on the decline, we’ve suggested a number of times, and she concurs. The Indian tech industry is showing every sign of having taken this in, brushed itself down and thinking “OK, so what do we do next?” It’s neither down nor out just yet.