Siescoms nasscom the indian software landscape june2014

NASSCOM & the Indian Software Landscape

The Software and Services Industry in India

NASSCOM & Role of NASSCOM

1. The evolution of India’s software industry.

2. Government Policies3. Outsourcing – 5 Pronged

value proposition4. India’s connected Users5. Summary

1. The Story of NASSCOM and the IT Industry 2. What is NASSCOM and its Use3. NASSCOM – Facts, Objective, Mission, Vision, Initiative4. Advantage of Being NASSCOM Members5. What is NASSCOM Core Purpose6. NASSSCOM - Main Activities7. NASSCOM – Initiatives8. NSR & NAC9. Affiliated Organisation10. Role of NASSCOM in Global trade Development11. Activities in Global trade12. Some Keys Facts 13. Does India Need NASSCOM?14. NASSCOM Five point Agenda for Modi Goevrment15. References

Agenda

The Software & Services Industry in

India

The Evolution of S&SI in India• One of the world’s most

successful information technology industries.

• Begun in 74, • Grew to around $0.05 bn in

1998. • In 2004, employed 345,000

persons, revenue of $12.2 bn, (3.3% of global)

• In 2012 it had grown to over $100 bn.

Software & Services Industry in India

The evolution of India’s software industry. ▫ The industry was begun by Mumbai-based conglomerates ▫ 7 of the top 8 exporters in 1980 were headquartered in Bombay with

a 90% market share (see table below).▫ As infrastructural costs increased - this caused the industry to

relocate to Bangalore.


Rank 1980, Indian HQ 1990, Indian HQ 2004, Indian HQ1st TCS – Mumbai TCS – Mumbai TCS – Mumbai

2nd Tata Infotech – Mumbai Tata Infotech – Mumbai Infosys – Bangalore

3rd Computronics – Mumbai Citibank – Mumbai Wipro - Bangalore

4th Shaw Wallace – Kolkata Datamatics – Mumbai Satyam – Hyderabad

5th Hinditron – Mumbai TI – Bangalore HCL – Delhi

6th Indicos Systems – Mumbai DEIL – Mumbai PCS – Mumbai

7th ORG – Mumbai PCS – Mumbai i-Flex – Mumbai

8th Systime – Mumbai Mahindra-BT – Mumbai Mahindra-BT – Mumbai

Share 90 % Market Share 65 % Market Share 38 % Market Share


• Government Policies:▫ Indian policy in the 1970s was “statist, protectionist and regulatory.”

FERA-1973 closed the door to product software development in India by TNCs.▫ As a producer of IT, the government failed. ▫ Rajiv Gandhi’s New Computer Policy, in 1984 (reduced import tariffs on

hardware and software ▫ In 1985, all export revenue (including software exports) was exempted from

income-tax.Some Key Factors:• The early '90s which saw the emergence of outsourcing. • Developments in telephony, fibre optics and satellite communications • Global software giants have established captive development centers in India


SSI in India - Outsourcing

SSI in India - OutsourcingIndia a Preferred Destination.

Five Pronged Value Proposition

India’s Connected Consumers

• India has become the largest player in offshore delivery with levels of work delivered that are amongst the highest across several verticals.

• The compounded annual growth rate (CAGR) of the industry has been over 25% in the last few years.

• Over these years, four main components have formed the industry, IT services, BPO, Engineering Services and Hardware.

• Banking and Financial Services, Telecom, Manufacturing are among the top 4 verticals for both export and domestic market.

• While hardware dominates the domestic market, IT services tops in the overall industry.

SSI in India - Summary

NASSCOM&

The role of NASSCOM

The Story of Nasscom and the IT Industry

A small event in 1987 – a meeting of entrepreneurs with big ideas in Delhi – went on to change the face of the Indian software industry. For, at the meeting, attended, among others, by N.R. Narayana Murthy and Nandan Nilekani, it was decided that an independent association was needed to represent the interests of the IT software and services industry, and thus Nasscom (National Association of Software and Services Companies) was born.

in 1991 when an old time friend and Information Technology industry veteran Harish Mehta offered Mr. Devang Mehta charge of NASSCOM, an association dedicated to the needs of the fledgling Indian Software Industry. Mehta accepted a part-time assignment with the organization that allowed him to pursue his other interests.

As India’s economic reforms began in 1991, the existence of Nasscom – and its ability to present the industry’s unified view – aided the take-off of the IT sector.

From evangelizing to brand building, from crisis management to foreign diplomacy, from being an adversarial proponent of a viewpoint to being a partner of the government, from a supporting to a stellar role – Nasscom has, over the years, played many parts. The result: it has been instrumental in the spectacular growth of India’s IT software exports from around USD 400 million in 1991 to over USD 118 billion today.

What is NASSCOM?India’s leading non-profit trade organization for IT services

What is the use of Nasscom?1. NASSCOM® is the premier trade body and the chamber of commerce of

the IT-BPO industries in India. 2. It is a global trade body with more than 1500 plus members, which include

both Indian and multinational companies that have a presence in India. 3. NASSCOM's member and associate member companies are broadly in the

business of software development, software services, software products, consulting services, BPO services, e-commerce & web services, engineering services off-shoring and animation and gaming.

4. NASSCOM's membership base constitutes over 95% of the industry revenues in India and employs over 2.24 million professionals.

NASSCOM

• The Beginning• Established in 1988• The entrepreneurs • Dewang Mehta• Presidents• Late Mr. Dewang Mehta

(1991-2001)• Mr. Kiran Karnik (2001-2007)• Mr. Som Mittal (2008-2013)• Mr. R. Chandrashekhar

(2013 – Present)

NASSCOM: NASSCOM Snapshot

Type Trade association

Founded 1988

Headquarters

New Delhi, India

Key people K. Natarajan, ChairmanR. Chandrasekhar, President

Mission Sustainable industry growth, Harness technology to benefit society

Method(s) Policy advocacy, Events and conferences, International affiliations, Skills development

Members 1500+

Motto Transform Business, Transform India

Website www.nasscom.in

•Extend industry academia collaboration•Redefine government interaction•Create more delivery locations in the country•Help industry upgrade branding and international

communication•Help small and medium sized companies to incorporate

core functions•NASSCOM should function as an Apex body that can

partner with other relevant group to meet aspiration of all stakeholders

Objectives

NASSCOM Organisation Structure - NASSCOM as an industry association is governed by the Executive Council which is an elected body from the membership.

In addition, Past Chairmen Council, Regional Councils and Industry Forum Advisory groups help to shape the agenda and priorities for NASSCOM.

• Vision▫To help the IT and IT enabled products and services industry in India to

be a trustworthy, respected, innovative and society friendly industry in the world

NASSCOM:

•Establish India as a hub for innovation and professional services

•Deepen the IT-BPM industry’s footprint•Facilitate growth and maintain India’s leadership position •Be a conduit of change •Work with government•Provide platforms for members to interact•Expand the country’s pool of talent •Harness the benefits of ICT

NASSCOM: Mission

•Partnership with the government•Research on IT and ITES•Support for quality products and services•Protection of Intellectual Property Rights•Reinforce the brand equity of Indian IT and ITES industries• Increase talent pool in India•Partnerships with member companies

NASSCOM: How it achieves this Mission

•The Domestic Market Initiative•The Innovation Initiative•The Education Initiative•The Women in Leadership-IT Initiative•The Security Initiative• Insights on industry trends•Opportunities to enhance visibility•Opportunity to network, build and share best practices•Global trade development

NASSCOM: Initiatives

Advantages of being a Member1. Members can participate in opportunities for global networking

and build business at NASSCOM's global events, and through delegations and road shows

2. Network with companies in other countries through their delegations to India

3. Receive information regularly about policy updates in different countries

4. Understand issues related to visas, immigration through NASSCOM’s mobility best practices sessions

5. Learn about trends and opportunities in different markets through country reports

NASSCOM provides crucial support and guidance to Indian IT companies wishing to enter foreign markets, as well as global multinationals wishing to enter India.

Assistance with regulatory procedures and framing of policies that are compliant with the existing laws and regulations are some of the things that NASSCOM does.

In addition, tin recent years the group has been helping start-ups incubate and promoting entrepreneurship. Furthermore, NASSCOM assists the central Indian government with policy formulation and good governance

initiatives. NASSCOM has set up committees to help global multinationals with their initial incubation in India and to

provide a roadmap to navigate the Indian bureaucracy and labor laws. Toward this end, NASSCOM has collaborated with several Fortune 100 companies for their entry strategies into

India and to answer any queries that they might have about the Indian business landscape. The directory of listings provides a quick overview of the Indian IT sector and is an invaluable guide for those

wishing to do business with the Indian IT sector. In recent years, the IT-enabled services (ITES) and BPO sectors have benefited tremendously with NASSCOM’s

help in bridging the gap between the business models in the West and in India. It can be said that NASSCOM has become a one-stop go-to place for companies wishing to do business in IT in

India. In conclusion, the Indian IT sector is shown up as a stellar example of how entrepreneurship can trump bottlenecks and red tape and thrive in Third world conditions to create excellent companies

What is NASSCOM’s Core Purpose?

Partnership with the government: NASSCOM acts as an advisor to the Indian government at the centre as well as state levels. With adequate representation in various ministries of the government, the organization ensures that the government frames industry friendly policies. It also forms partnerships at the global level for promoting the Indian IT and ITES industries1.

Research on IT and ITES: NASSCOM conducts in depth research on the IT and ITES industries to keep its members well aware of the global trends, best practices, threats and opportunities.

Support for quality products and services: NASSCOM encourages its members to maintain high quality of products and services with the aim of developing global public confidence for its members and the industry. It also helps the members achieve international quality certifications through regular seminars and workshops on quality standards.

Protection of Intellectual Property Rights: The organization is a strong proponent of intellectual property rights. It supports software anti piracy by setting up hotlines and facilitating law enforcement.

Main Activities

Reinforce the brand equity of Indian IT and ITES industries: NASSCOM organizes regular international seminars and conferences to build a brand for the Indian IT and ITES industries.

Increase talent pool in India: India has one of the largest talent pool in the world with 300,000 engineers and 2.1 million graduates being produced by its 11,200 higher education institutions each year. NASSCOM ensures that the quality and quantity of professionals in the country increases with time and that the country is able to cater to the global demand of IT and ITES outsourcing services.

Partnerships with member companies: The organization provides various services to its members such as the following:

Creating business opportunities and sharing of best practices knowledge through forums, seminars and conferences

Publishing research reports that provide the members counsel from leading industry analysts. The organization also maintains a database of member companies specifying their areas of expertise.

Providing information on global business norms on taxation, regulations, recruitment, etc.

Main Activities – Cont.

NASSCOM – Initiatives NASSCOM undertakes several initiatives and works with multiple stakeholders within the global IT-BPO ecosystem:

Policy Advocacy - NASSCOM collaborates with the Government of India at the Centre and states to build a policy framework that is conducive to the growth of the IT-BPO industry in the country.

Membership Engagement - NASSCOM works closely with its member organizations, encouraging them to share best practices and experiences, and mentor smaller organizations that are still on the learning curve.

Sector Skills Council - They are tasked with developing an enabling environment for skills development, including support for (i) clarification of sector-specific competencies/skills (ii) capacity development for skills development institutions/ such as curriculum and standards, faculty development, and so forth; (iii) trainee placement mechanisms, and (iv) monitoring and evaluation, supporting systematic collection and analysis of data about skills development, including employer feedback regarding the quality of trainees (V) quality assurance of independent third-party providers etc.

NASSCOM – Initiatives Diversity & Inclusivity - The ability of a diverse group of people to build strength and unity through

their diversity is the power that propels the organization and consequently, the Indian industry, into new dimensions of performance

The Indian IT-BPO industry has set high standards in inclusivity and is among the first to recognize the business imperative for Diversity and Inclusion. Inclusivity actions have evolved from individual programs to culture-changing organizational efforts.

Industry Development- NASSCOM undertakes several development initiatives to spur the growth of the sector.

Research - It conducts industry research, surveys, and studies on emerging IT-BPO trends and sector performance to provide factual perspectives on the industry and the growth opportunities ahead.

Events - It organizes national and international events to showcase new opportunities, collaborate, build thought leadership and facilitate networking.

Forums - Industry forums launched by NASSCOM cater to the needs of diverse segments and build specific programs that can help these sectors to realize their potential. The Forums at NASSCOM include: Animation VFX Gaming Technology etc.

NASSCOM – Initiatives Global Trade Development - Expanding partnerships in existing markets and

building opportunities in new markets is a key priority for NASSCOM. This is enabled through an effective engagement with international stakeholders, the government, customers and associations to collaborate on international policy, business partnerships, MoUs and business delegations.

Entrepreneurship - NASSCOM is committed to promoting and nurturing small-and-medium companies within the IT-BPO industry. It does so through its EMERGE Product Group, a one-stop-platform that uses online and offline sessions to promote mentorship and help members evolve winning sales and marketing, partnership and funding strategies

Workforce Development - Enhancing employability and access to a skilled talent pool is a critical enabler for India’s competitiveness. NASSCOM is engaged across a broad spectrum of academia, industry and governments to devise policies, curriculum and assessments to achieve the above objective.

NASSCOM – Initiatives

Domestic Market, E-governance - Use of technology and business services is gaining increased adoption across governments, corporates and small and medium businesses (SMBs). NASSCOM’s focus is to engage with these stakeholders and build initiatives that promote public-private partnerships and standards and recognise excellence in IT adoption

Enabling Environment - NASSCOM in partnership with the industry has created specific programmes and awards that encourage innovation, security best practices and development of Tier 2/3 cities.

Sustainability - In order to promote balanced growth across India, and build a sustainable IT-BPO industry, NASSCOM engages with its members on critical issues related to corporate social responsibility (CSR), enhancing diversity, inclusive growth and Green IT.

NSR and NACNational Skills Registry (NSR) - NASSCOM in partnership with the industry has developed a unique initiative–the National Skills Registry (NSR), a national database of registered and verified knowledge workers in the industry. This database is managed and run by NSDL Database Management Ltd. (NDML), a fully owned subsidiary of National Securities Depository Limited (NSDL)

NASSCOM Assessment of Competence (NAC) - NASSCOM Assessment of Competence (NAC) is an assessment and certification framework to ensure a steady supply of quality professionals to meet the present and future requirements of the IT-BPO industry

Affiliated Organizations

• Data Security Council of India (DSCI) - The Data Security Council of India (DSCI) is a not for-profit organization, established with the key objective of building a credible and committed body to uphold data privacy and security standards. The mission of DSCI is to build the trustworthiness of Indian organizations as global sourcing service providers, and to send out a message to clients worldwide that India is a secure destination for outsourcing, where privacy and protection of customer data are enshrined in the global best practices followed by the industry

• NASSCOM Foundation (NF) - NASSCOM Foundation (NF) was instituted with the aim of using information and communication technologies for development (ICT for D), and to catalyze corporate social responsibility (CSR)initiatives within the Indian IT-BPO industry. By implementing a diverse range of programs NF is taking information and communication tools to underserved communities across the country. It is also channelizing the immense potential of the ITBPO industry towards socio-economic development of the nation.

• National Institute for Smart Governance (NISG) - Incorporated in 2002, the National Institute for Smart Governance (NISG) is a Section 25 organization set up in public-private partnership with NASSCOM, the Government of India and the Government of Andhra Pradesh. The key objective of the organization is to catalyze development of e-governance in the country

Role of NASSCOM in GLOBAL TRADE DEVELOPMENT

NASSCOM continued to strengthen India’s credentials as a key global IT-BPO hub by initiating the following activities

1. Issues with delays/refusals of US visas and border patrol at port of entry 2. EU-wide ICT (Intra-company transferee) visa3. Visa issues with Canadian authorities 4. German mobility issues5. Workshop on global mobility issues with ministries of Government of India6. Shortage of work visas in Switzerland

Activities In Global Trade

1. Policy submissions and consultation to various Governments and Government agencies

2. Addressing visa and work permit issues and fighting protectionism

3. Exploring new geographies and creating opportunities for partnerships

4. Organising sessions for members on countries of interest to share information and updates on policies, business environment, partnership opportunities, etc.

5. Conducting research and creating reports on ICT opportunities in Emerging Markets

6. Building partnerships with various International IT Associations

NASSCOM: IT-BPM revenues 2014 = US$ 118 bn



NASSCOM:

• India's Nasscom seeks restructuring to stay relevant•Doubts over association's relevancy• India should be branded as a centre for innovation•Revisit the Swadeshi commerce

▫Re-imagining NASSCOM▫Building the ‘Made in India’ brand

•Role of Nasscom in Corporate Governance

NASSCOM: Does Indian IT need Nasscom?

•Doubts over association's relevancy▫"Despite top line growth, leading providers such as Infosys

and Wipro are struggling to meet shareholder expectations. Rupee and wage appreciation, competition from other low-cost locations, investments in non-linear growth, and the cost of hiring staff in non-English-speaking countries, particularly in Continental Europe and Latin America, are adding to the complexity of the challenges facing Indian service providers,"

Thomas Reuner, principal analyst at Ovum


• India should be branded as a centre for innovation▫"Given that we want to become end-to-end solutions

providers, given that we need more interactions at the boardroom level, with CXOs, we said it is right to brand India as a proactive provider of solutions rather than a reactive developer,"

N.R. Narayana Murthy


“We are suggesting (to new Indian Government) to launch a technology entrepreneurship mission immediately, in which there are several different components which together will accomplish this purpose,” R Chandrashekhar, National Association of Software and Services Companies (Nasscom) President, had said 1. “The first is what all measures the Government needs to take to enable innovation and

support entrepreneurship. 2. Second could be creating a system of funding for start-ups, and connecting them with

academics and research and development.3. Third is to make the domestic investment easier and simpler. 4. Forth is about the rules and regulations, including the rules regarding listing an IPO and

taxation on stock options to employee of a company.5. Fifth is that, the Government needs to ensure that the rules for opening and operating the

small business are “far simpler” than those are at the moment. Prominent among other areas of Nasscom agenda is to promote the growth and global competitiveness of the IT industry by building new markets, expanding existing markets, focusing on skill development

Nasscom charts out five-point agenda for new Indian Govt led by Modi – May 2014

1. www.nasscom.in2. www.businesstoday.in3. http://bpooutcomes.com/nasscom-brief-primer/4. NASSCOM – What It Does Today 5. timesofindia.indiatimes.com › Does Indian IT need NASSCOM6. India's Nasscom seeks restructuring to stay relevant (ZDNET.com) By Jamie Yap7. Doubts over NASSCOM association's relevancy report by Business Standard8. NASSCOM needs to revisit the Swadeshi commerce model – Information Week9. Role of Nasscom in Corporate Governance -

nasscomemerge.groupsite.com/.../Corporate%20Governance%20Report10. http://www.thehindubusinessline.com/economy/nasscom-charts-out-fivepoint-

agenda-for-new-indian-govt/article6007927.ece

References

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