astart-up can only hope to succeed if it has a clear understanding of its target markets and challenges. In fact, competition might prove to be one of the biggest stumbling blocks in its road to success. Given that we live and work in a 'Bat' world, competition is no longer limited to what we see around us. It extends to unseen IT start-ups and established firms in other countries, battling for a slice of the global tech products/ services pie. So, whether it adopts a strategy to take on its competitors or chooses the right space to be in, it is important for a start-up to know whether its greatest challengers are its Indian counterparts or overseas firms in China and emerging areas like Brazil. In a bid to help Indian IT start- ups navigate their way through intense competition and emerge winners, we present the view of some panellists who have stood up to competition and made a name (and a living) for themselves in the process-Aadil Bandukwala, chief evangelist, Leading Minds & Talent Onions; Gurudev R Goud, vice president-business development, KTwo Technology Solutions; Nirmal Shah, vice president, Global Delivery, Tescra; and Vihang Kathe, director, International Business Consulting. Who poses the greatest challenge? Kathe's experience suggests that competition varies depending on each i.i;. I www.itmagz.comIDECEMBER 2008 I 41
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astart-up can only hope
to succeed if it has a
clear understanding
of its target markets
and challenges. In fact,
competition might prove to be one
of the biggest stumbling blocksin its road to success. Given that
we live and work in a 'Bat' world,
competition is no longer limited towhat we see around us. It extends to
unseen IT start-ups and established
firms in other countries, battling for
a slice of the global tech products/
services pie. So, whether it adopts a
strategy to take on its competitors or
chooses the right space to be in, it
is important for a start-up to know
whether its greatest challengers are
its Indian counterparts or overseas
firms in China and emerging areaslike Brazil.
In a bid to help Indian IT start
ups navigate their way through
intense competition and emerge
winners, we present the view of
some panellists who have stood up
to competition and made a name
(and a living) for themselves in the
process-Aadil Bandukwala, chief
evangelist, Leading Minds & TalentOnions; Gurudev R Goud, vice
president-business development,
KTwo Technology Solutions; Nirmal
Shah, vice president, Global Delivery,
Tescra; and Vihang Kathe, director,
International Business Consulting.
Who poses the greatestchallenge?
Kathe's experience suggests that
competition varies depending on each
i.i;. I www.itmagz.comIDECEMBER 2008 I 41
"It is the overallvalue that counts,
irresQective of.,her you are
competing againsta fellow local playeror an international
player/·
Nirmal Shah, vice president, Global Delivery, Tescra
developers wouldn't mind clockingin a few extra hours after their
routine schedule to help design a
project. Web developers usually
code, and design is not their forte.
However, in India, you will find a
lot of Web developers who know
their design like the back of their
hands. They don't mind working
late hours simply because they have
the drive, the zeal and the passion
to create that magical product in the
promised timeline.
Against overseas competition,
Shah cites maturity, a better
understanding of processes, delivery
models and technological depth and
breadth as the major advantages
that Indian companies possess.
"Barring (very) few examples,
IT vendors from other emerging
nations are really small players and
sometimes just a rag-tag bunch of
techies running a garage operation.
Scale is definitely against them at
this point in time," he says.
Advantage India
Evidently, the challenge has twodimensions and necessitates tech
start-ups to have eyes'in front aswell as at the back of their heads to
make their presence felt in a toughmarket. But do Indian techies have
, the inherent skills to help them deal
with the intra-country competition
and price wars that Bandukwala feels
are becoming a frequent occurrence?He himself believes that clients
nowadays want a relial':>le,quick and
efficient partner. "If a start-up can
build and leverage on these three
core competencies (of being reliable,
quick and efficient) other than its
technological expertise, it will neverrun out of business, no matter what
price it quotes," he advises.
Further, Bandukwala points outthat India boasts of an abundance
of 'flexible' talent and passion,an otherwise scarce resource, as a
huge advantage. He elucidates his
point with an example: typical Web
behind Indian and Romanian firms
in terms of talent, technology and
skills. He feels that these advantages\""'m~~~~\.~~\...~~"-~'-~~'\..~'-~"-~~'-
agencies in India and Romania bag
60 per cent of the work outsourced
by the US and the United Kingdom.
Other countries rapidly catching up
in this sector are Malaysia, Israel,
Bangladesh and Macedonia.
According to Shah, Indian
counterparts as well as firms in
Brazil, Bulgaria, China, Hungary and
Mexico, comprise the competition
faced by Indian tech endeavours.Goud, however, is of the view that
the biggest competition for Indian IT
start-ups comes from within India,
although some Chinese firms rule
the roost in the 'buy cheap, use and
throw' product category!
Gurudev R Goud, vice president-business
development. KTwo Technology solutions
"In order to caterto larger volumes,
firms just needto focus on offering
products/services of anequivalent 'quality at a
oomDetitive price."
niche of the IT sector. For instance,
he explains, "If you are competing
for an ERP implementation for SAP,
~~ 'S~~~~~~~~ "\\.~~~ ~~ "'-~~~~
companies like Infosys, Wipro, TCS
or HCL. However, if you are looking
for niche storage solutions, expect
competition from US companies
like EMC, HP or IBM. My firm is
engaged in the storage, server and
.network security solutions sectors.
The greatest competition we face is
from large MNCs operating in this
space-firms from countries likethe US, Israel and Russia that are
strong in the security segment and
companies like Dell, IBM and HP
that have a sound presence in storage/
server, technology."Bandukwala seconds this. His
\
~nteractive Internet agenC:y,Leading
Minds, faces great competition fromsimilar firms in India and Romania.
This is because Internet start-ups inChina and Brazil, for instance, are far
Q)oo'>
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42 I DECEMBER 2008 I www.itmagz.comli. "t.
Adding value to Brand IndiaGoud believes Indian techies'
skills in Web 2.0, WiMAX,
embedded technology focusing
on the design of low-powered and
high-performance devices, and the
convergence of automotive, medicaland consumer electronics, are far
superior to the overseas competition.Nevertheless, he stresses that Indian
IT professionals need training on
how to present and market theirskills. "We have it in us but need
world-class presentation, businesscommunication and PR skills," he
advises. On a larger scale, he feels
the Indian IT industry should take
inspiration from the Korean and
the Swiss ecosystem, and organiseitself likewise to nurture talent and
promote innovation.
Kathe mentions India's prioritising
value-based entrepreneurship as
its greatest strength, which should
ideally be nourished with government
support. He says, "The Indian
management principles emphasise
providing value for money products/solutions to end-customers. In
keeping with this tradition, tech
start-ups need to develop world class
products that may be marketed notonly in India but across the world."
Expand your footprintIf value-based entrepreneurship
is stressed, even a start-up can hope
to gain a foothold in a market
where an older player is already well
established. "Start-ups must see
value in not competing on price,
but overall value. If you show value,
you are bound to get more business
and take that bit away from the
competition. In fact, although large
companies drive the IT industry,
smaller start-ups are agile and have
the advantage of being able to pick
''Tech start-ups needto develop world
class products thatmay be marketed
not only in India butacross the world."
Vihang Kathe, director, International Business Consulting
things up fast~r"A start-up cancarve a niche for itself very quickly
if it focuses in the right direction,"advises Shah, as he shares how his
firm co-exists with the big boys
of the Indian IT industry, and
actually gets to do some cutting
edge work that they don't.
Goud agrees. Citing Skype,YouTube and Orkut as the best
examples of how starr-ups have
given established biggies a run for
their money, he says, "Every start
up's mantra must be to 'give value.'
Don't worry if your way forward
is blocked by a big player because
at the end of the day, people
respect the value they derive from
a producr/service. Besides, market
leaders usually overlook a few key
points like service quality, customer
loyalty or price. A new firm can use
these omissions to its advantage."
Kathe sees the ability to
provide niche solutions modelled
on the offerings of large players
at a lower price, as being a key
factor for enabling starr-ups tosurvive in markets.
Don't get bypassed by ,_'local' companies ,,"
No discussion about competition
would be complete without
mention of the clients' perception of
competing local and international
players. When an Indian tech firm is
pitted against an overseas firm, which
one is more likely to win by virtue of
its country of origin? Further, if two
local players compete, what are thekey factors that influence a potentialclient?
.Bandukwala feels that when it
comes to the Internet platform,
clients usually don't bother about
the location of an agency or partner.
"They are only very particular about
the ability to understand, tweak,customise, build and scale the
technology they need and to deliver itin a decent timeframe. If these can be
matched, more often than not, even
price is not a barrier," he says.
Shah too stresses th(! importance
of delivering value. "It is the Qverall
value that counts, irrespective of
whether you are competing against a
fellow local player or an international
player," he says. And what adds to a
firm's value in this local versus foreign
debate? Apparently, a lot of weight isplaced on the firm's local presence in
its potential clients' city of operations.
Shah explains: "We are headquarteredin the US and some of our clients feel
more comfortable when they know
we are a 'local' company. We havelost some bids because we did not
have a presence in a particular city
or state. The bias, if there is any, isfor someone to be local to the client's