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IT hit by global financial turmoil – What is in store now? October 11, 2008

Posted by Arup Deb in Techbytes.
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Because of the current global financial crisis, the last few months or rather few weeks have been pretty bad for, the entire world in general, and the IT industry in particular. Contracts are getting on to the hold mode and in several instances, being scrapped altogether. The small and mid-sized companies are particularly a hassled lot. Large companies too, may have been impacted but they have the resilience to face the rough tides. From the Indian context, companies like TCS, Infosys, Wipro, Satyam and others of their stature had realised the importance of marketing, in the very initial stages of their business. Their technological prowess coupled with the market reach and high visibility, will see them through the bad times. However, they would certainly have to re-invent themselves, in order to face the new world that would emerge after the clean-up act currently underway, in the world of finance.  

The real challenge would certainly be for the small and mid-sized ones. Firms that have got niche products or services, are the ones that would see greater opportunities unfurling for their offerings. They would experience steady growth for themselves without much difficulty.

Companies like Zenith Infotech Limited, which is into the Managed Service Infrastructure and Business Continuity space or for that matter, companies like Allied Digital Services Limited, who are present in the IT Infrastructure Management & Information Security Services space, are the companies that would be able to weather the current global financial turmoil, with much ease. These are the companies that have a very bright future. Businesses like them, would also see very little competition creeping in, because of the very nature of their business, which needs great amount of persuasion to make the client repose trust. And, the high cost of building up a new business in this space, from scratch, would certainly act as the entry barrier. And, what about the brand equity that needs to be built. So, it is not only the cost that can act as a detriment, but also the time that new players in the space, would need to spend, on growing up the visibility about their organizations. These companies have already done it and what they need to do now, is to spread their wings into geographies they are not present in and also increase their advertising spends, to have a sustainable impact among the target markets.

The smaller IT players, specially those in the IT Services offshoring space, should sit up and look at innovative ways of sustaining themselves. These outfits should stop treating their competitors as enemies and rather put some co-ordinated efforts in running their businesses. One of the possible strategy could be, to have a common order pool, developed through a common marketing organization, jointly owned by these small firms. They can have a common umbrella brand, under which they can sell their services, thus gaining significantly on the cost front and also leverage the enhanced power, to penetrate client accounts.

So all is not over for the IT players of the world. What is needed is loads of innovative thinking & action and the world can be your’s.