Conversations with Indian IT changes from offshore to expertise

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We get used to reading articles about deals being won by big systems integrators. These companies either provide all the services in a deal or sub contract to a smaller firm, which hardly gets a mention.

It is these smaller companies which are interesting because they are highly specialised in niche areas. These agile companies can respond to market demand quickly and change their approaches in response.

I interviewed tier two Indian supplier MindTree a couple of years ago when it was first targeting UK customers. It came to market with the offer of high end consultancy skills combined with low cost delivery. Back then it had 80 UK-based staff. The company has been focussed on the mid-market.

I met the company's UK head Tridip Saha last week and was interested to see how the company is doing.

Last year it grew its revenues in Europe by 50%. It now has 130 UK based staff as well as 1500 dedicated UK support staff in India.

Tridip told me that there has been a big change in the conversations MindTree is having with UK customers has changed from being about offshoring to being about expertise.

When it comes to expertise MindTree says its "cross court backhand" is business intelligence and analysis. The main sectors where it is doing business are retail, financial services and travel and transportation.

Tridip says every big business has a wealth of data which can provide valuable insights about business opportunities.

MindTree's business intelligence (BI) engagements might include the company building a data warehouse or expanding an existing one followed and creating dashboards for the business users so they can use information effectively.

He says 70% of the company's UK customers originally approached it for BI services.
 
MindTree is also involved in the Indian ID project.

2 Comments

Indian outsourcing providers have already taken all the low-hanging fruit with regard to cost, and people are less inclined to fall for that now they realise all the hidden costs and inefficiencies of many offshore solutions. So the Indian providers need a new selling point.

Meanwhile, as you've already pointed out in your blog previously, one consequence of the outsourcing+offshoring paradigm is that the UK-based skills infrastructure has been severely damaged, with few openings for new entrants to the industry and massive insecurity for many experienced and skilled UK-based staff, which also impacts on skills as people find themselves out of work or being denied training or opportunities for career progression. This creates an increasing sense that the mythical "skills crisis" is starting to become a reality in some areas, a fear that Indian providers can exploit, whether or not it's true.

However, it's also interesting that MindTree is specifically looking at BI and data warehousing etc, which are obviously markets ripe for their attention. As a database developer, I have often been appalled at the ignorance of database systems and data management principles displayed by every Indian developer I have worked with in the last 10 years. The big outsourcing providers recruit busloads of cheap inexperienced graduates, work them hard and sell their services cheaply, but these kids know (and usually care) nothing about data systems and get little opportunity to develop those skills because large outsourcers work on a "one size fits all" approach to systems development that tries to avoid serious engagement with data technologies.

So I can well understand why MindTree would like to sell higher-value BI and data-related consultancy services into a UK market that is already saturated with all the cheap bog-standard offshore developers it can take. But it will be interesting to see where they think they are going to find those specialist data skills, when as far as I can tell the offshoring model has so far failed utterly to provide any meaningful level of expertise in those areas.

There is indeed an increase in the demand for freelance workers and employees. That is what online job sites are capitalizing on. We have seen an increase in their number and slowly the industry has become more and more important.

I happen to know the CEO and founder of Staff.com, an online staffing company which seeks to bridge top employers from the UK, US and Australia to the top freelance employees all over the world. He was able to confirm that there is an increase in the demand of the experts on their database. More and more clients as well as signups are recorded for the past few months.

This proves that outsourcing has now extended to specific skills and niches. Before, when we think about outsourcing it was more of utilizing the services of one company. Now, we can outsource to individuals. Cost-saving and expansion techniques as well as technology has greatly made this possible. I'm sure we'll be seeing more of it in the future.

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This page contains a single entry by Karl Flinders published on May 15, 2012 1:08 PM.

Outsourcers seen as money grabbers, but KPMG says reasons for outsourcing are changing was the previous entry in this blog.

Never mind the IT, the Jubilee line is my Olympic worry is the next entry in this blog.

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