Driven by adoption of cloud technologies India’s Domestic IT Market to touch USD 67 Billion by 2020: Zinnov Study

February 26th, 2015


India's Domestic IT Market Landscape - 2015 from Zinnov

India’s massive growth presents a huge opportunity in the domestic market. A recent report released by Zinnov Management Consulting on “India’s Domestic IT Market Landscape 2015”, sized the domestic IT market at USD 36 Billion in 2015. This market is expected to grow at 14% CAGR to reach USD 67 Billion in 2020.

The Indian Government’s Digital India project will be an exponential driver for massive growth in IT adoption. The estimated budget of Digital India is going to be USD 19 Billion between 2014 -2018.

Zinnov study found that increased access to enabling infrastructure such as increased use of smart phones, and easy access to internet will result in greater adoption of technology by Small Businesses.

The study highlights key vertical wise initiatives of IT adoption across government, BFSI, Education, Healthcare and Telecom. All of this is expected to Help India become the 2nd Largest IT market in APAC by 2018.

The key drivers of IT growth highlighted in the report are:

  • Up gradation of legacy systems
  • Growing acceptance of cloud based solutions
  • Emerging technologies like Internet of Things, Big Data and Mobility
  • Focus from the India government on digital India.

The study reveals that total cloud market in India will grow at 45% CAGR to USD 14.8 Billion in 2020. The study estimates the private cloud to increase to USD 7.4-7.6 Billion in 2020. The public cloud market is expected to almost of equivalent size at USD 7.0-7.4 Billion in 2020.

Study finds that Indian CIO’s site favorable reasons for continued success of the cloud market including cloud technology being the number one priority and the belief the SMAC stack will provide a competitive advantage for their organizations.

Multiple factors are expected to result in significant adoption of cloud solutions. Some of the primary drivers are setting up of local datacenters. The expected 3X increase in internet penetration backed by a digital India initiative that is expected to attract USD 17 Billion investment in next 3-4 years. 90%  of SMB’s are expected to be tech influenced by 2020. This coupled with over 3X growth in total number of technology startups in India offering vertical specific innovative solutions backed with affordable pricing will drive adoption of cloud solutions.

Key Findings of the Study

  • India Domestic IT Market sized at USD 36 Billion in 2015.
  • India Domestic IT Market projected to grow at 14% CAGR to USD 67 Billion by 2020.
  • India to become second largest IT Market in APAC Region by 2018
  • Growth of IT Market to be driven by up gradation of legacy systems, growing acceptance of cloud based solutions, emerging technologies like Internet of Things, Big Data and Mobility as well as a focus from the India government on digital India.
  • Government, BFSI, Education, Healthcare & Telecom to be key growth verticals.
  • Total Cloud Market in India to grow at 45% CAGR to 14.8 Billion
  • Cloud contribution to IT Spend to rise to 17% of overall market by 2020.
  • Public Cloud Market in India is USD 700 -800 Million in 2015 and will rise to USD 7.0-7.4 Billion in 2020
  • Private Cloud Market in India is USD 1.6-1.8 Billion in 2015 and will rise to USD 7.4-7.6 Billion in 2020.
  • For full copy of the report please email media@zinnov.com

Zero to one – Encoding a digital DNA

February 18th, 2015

With market becoming highly commoditized, it has become difficult for any enterprise to survive if it fails to differentiate. In order to remain competitive, it has become essential for enterprises to innovate continuously. Innovative products and services will not only help enterprises increase their customer base/reach, but also help in improving process efficiency by adopting & implementing new, advance frameworks and technologies.

Few years back, smartphones, social networking websites, tablets, big data analytics, cloud-based ecosystem didn’t exist or were still struggling for wider acceptance. However, today, the convergence of some of the new technology areas – M2M communication, Machine learning, deep analytics, social, cloud and mobile technologies have emerged as the key drivers of digital era. Digital era will play a crucial role in defining the next fifteen years, where digital technologies and platforms will have a significant impact on how businesses have been done earlier,

As per our research estimates, over USD 30 trillion of market capitalization would be disrupted by digitalization. This disruption will impact 7 key industry verticals including Retail, Media & Entertainment, Travel & Hospitality, BFSI, Telecom, Healthcare, and Energy & Utilities.

This also indicates that in the next 2-3 years, over 550 companies in the Forbes 2000 list would move out, and be replaced by organizations that are far more tuned to a digital universe.

In the age where economies across the globe are extremely intertwined, power will rest in the hands of consumers with the role of  consumers not restricted to buyers only. Consumers having access to significant technology resources are playing a key role in determining how businesses need to evolve. With businesses being forced to offer new age products and services, digital age will witness emergence of organizations that co-create with customers. Changing customer requirements are forcing businesses to change their entire outlook, undertake structural changes and implement the same at a rapid pace. Businesses that fail to match pace might fail to survive!

Among all verticals, retail industry has been impacted the most by digitization. Digitally native retailers have fundamentally changed the business and operations landscape, and consequently moved ahead of the pack. Digital native retailers such as eBay and Amazon are targeting customers and engaging with them in newer & innovative ways via a range of channels. These companies not only analyse the data they collect but also use 3rd party data sources to understand what a customer is looking to buy. Subsequently, they try to engage customers only in their areas of needs and wants. The customer experience is hyper-personalized using machine learning techniques and complex algorithms.

The usage of digital solutions, technology and platforms is not limited to the retail segment only. With new technologies driving changes and creating a vast amount of qualitative and quantitative data, sports and entertainment businesses are also at an inflection point. Recently, Shahrukh Khan’s Kolkata Knight Riders (KKR) leveraged SAP analytics solutions to choose the playing team that had the maximum chances of winning the tournament. The digital solution helped KKR turn data into actionable insights and  gain competitive edge by increased understanding of player availability, reliability, readiness, and performance.

The exponential disruption in today’s world by the digital natives has made it imperative for traditional enterprises to transform. Their only solution for staying relevant is Enterprise Digital Transformation (EDT).

Customers’ changing requirements along with the need to remain competitive in business have set the right momentum for the companies to reorient/restructure their core strategies aligning them with digital channels. Today, companies are undertaking digital transformation at varying paces, experiencing success as well as facing roadblocks. The digital transformation initiatives undertaken by organizations, which have proven successful, are typically focused on changing customer relationships and experiences (customer engagement), process excellence (business process) and operational excellence (business model).

Customer Engagement

Today consumers prefer products and services that match their tastes and preferences, and are personalized. Enterprises are deriving advantage of the data generated in years to gain an in-depth understanding of specific market segments and geographies.

In addition, enterprises are using digital solutions to engage with their customers, create awareness among them about new products and build brand loyalty. Today, businesses have shifted from traditional transaction based short term interactions with customers to long term relationship-building engagement models.

With customer being increasingly empowered, enterprises are striving to maintain a competitive edge by offering personalized experiences, customized promotions and omni-channel facilities for a consistent experience.

Process Excellence

With market becoming increasingly  dynamic than ever before, standard business process are no longer relevant in digital era, and are being replaced by adaptive processes.

With growing competition in the market, it doesn’t take time for customers to jump from one ship to other if they don’t experience satisfactory experience across digital channels. Therefore, for ensuring customer retention, attracting new customers, enterprises have started building agile business processes which are customer-centric. This will help enterprises in handling any design and process change in step with changes in the market, thus ensuring reduced time for new product development and faster addressal of consumer complaints.

Operational Excellence

Operating model plays a key role in achieving business excellence.

Digital transformation requires faster go-to-market in order to cater to its dynamic nature. The processes for Enterprise Digital Transformation (EDT) need to be incremental and iterative; and thus agile methodology needs to be implemented.

Zinnov has developed a four-step agile EDT process/methodology for all traditional enterprises undertaking the Digital Transformation journey. The process involves building EDT knowledge base and evaluating possibilities, assessing business and digital priorities, establishing a step-by-step methodology for digital readiness, and subsequently implementing digital solutions incrementally and iteratively.

Enterprise Digital Transformation (EDT) is the need of the hour. It is the most revolutionary thing that has happened since e-mail. Digital enterprises reap manifold benefits, tangible and intangible, ranging from increase in top-line and bottom-line, growth in customer base, high customer satisfaction, and improved productivity.

Enterprises that will adopt digital transformation will be successful in creating a vision for how they will use digital technology for customer engagements in new and innovative ways, and even re-think about re-structuring their operations aligning them with digital channels.

Gearing up for Confluence 2015

January 21st, 2015

digital transformation, agile development, global markets

Zinnov’s annual thought leadership summit; Confluence scaled new heights in the year gone by. The event was hosted across continents in 4 global locations witnessing attendance from global decision-makers in the Engineering and Technology domains. Insightful Keynote and Panel discussions from over 150 prominent speakers and representation from the senior leadership of over 2000 global multinational corporations made the events an enriching experience for everyone involved.

Riding on the success of the German leg of Confluence 2013, last year’s Confluence in Munich saw an overwhelmingly positive response from over 100 attendees. The Bangalore leg of Confluence also saw the launch of the Z-insights app; a platform that allows for the seamless sharing of industry insights relevant that add value to conversations among senior personnel. Confluence 2014 provided an unprecedented platform for the exchange of ideas, demonstration of thought leadership, peer insights and collaborative opportunities to drive the future of technology.

The discussions focused on building smaller, better and faster systems to drive next generation innovation in engineering as well as the key strategies to navigate the emerging Asian markets and unlock its immense potential. It was enlightening to hear the viewpoints of industry stalwarts on key trends and their implications. This year, we intend to take the discussions to the next level. It is with this seeding thought that we have chosen ‘Building Technology Organizations of Tomorrow” as the overall theme for the upcoming Confluence to be held in the Bay Area on March 12, 2015. Confluence 2015 will examine tomorrow’s digital technologies and assess their global impact on both business and society.

In the recent past, we have observed that legacy organizations are being disrupted and are failing to keep pace with the hyper-volatile business landscape. The competitive landscape for organisations has become more dynamic. 465 companies moved out of the Forbes list from 2009 to 2013 and were replaced by a set of new entrants. This is expected to increase to 550 by 2015. Only 2 out of the top 10 Forbes companies in 2009 still remain in the 2014 top 10 Forbes list.

We at Zinnov believe that there are three key propellers that are driving this disruption

  • Hyper Agile Competitors- Tech Mafias, Startups, digitally empowered firms and agile emerging market companies are driving disruptions in the market landscape
  • Digital at the Heart of Business – Mobility, Cloud, Analytics and Social Media have made it mandatory for digital to be at the heart of business.
  • Globalized Markets-Eastward moving economy is putting further pressure on traditional organizations.

It is not the strongest or the most intelligent who will survive but those who can best manage change

-Charles Darwin

Organizations of Yesterday” have failed to respond to these challenges and are struggling to survive. These organizations exhibit certain key characteristics including:

  • Digital as a choice
  • Accelerated growth in focused verticals
  • Technology dictated product roadmaps
  • Lateral focus on the international markets
  • Solitary/Siloed organizations
  • Hierarchical Decision Making

However “Organizations Of Tomorrow” are different in their approach. They:

  • Explore outwards for rich talent
  • Increased investment in future technologies
  • Encode Digital in DNA
  • Optimize costs in legacy products and redirect savings new products
  • Go Local for Global Markets

Confluence 2015 will explore the different forces at play that are defining the choices that organizations must make in order to unlock the potential to create a future ready enterprise. It will feature two tracks – Leadership and Enterprise Strategy to help drive innovation in across organizational facets.

The leadership track will focus on driving initiatives to implement a culture that is conducive to building future-ready organizations, establishing new businesses in markets captured by industry giants and exploring outward for global markets. Stay tuned to our blog for insights from the topics of discussion mentioned below:

o   David vs Goliath: What it takes to build an organization in the midst of giants
o   The paradox of Leadership: The theory of Singularity vs lean methodology

The Enterprise Strategy track will cover topics that will help organizations optimize their operations and build efficient strategies and processes. It will focus on measures that will enable the enterprises to transform themselves to build next-generation capabilities and drive innovative initiatives. Industry experts will debate on the best strategies to develop digital capabilities and build agile teams.

Stay tuned for upcoming insights on the following topics:

  • Playing to Win: What it takes to hire right
  • Porous Innovation: Innovating within amorphous organizational boundaries.

We look forward to an exciting agenda of topics that will be debated on by influential leaders in the technology and engineering ecosystem

Confluence 2015 will provide an opportunity for leaders to collaborate and shape the global agenda by exploring new models, innovate the most sought-after solutions in and around digital age. The forum would generate powerful ideas and collaborative spirit required to manage the future course of action and align stakeholders around that vision.

The journey begins on March 12, 2015 with the US leg to be held in the Bay Area. At Zinnov, we are very excited to organize this year’s iteration of our flagship thought leadership summit. We hope that you will voyage with us on our quest for excellence in innovation and business strategy.

Please write to us at media@zinnov.com if you would like to receive more information about the event.

Join the conversation on Facebook by liking our page Zinnov Confluence.

Engage with us on twitter using the Hashtag #Confluence2015

Big Data Trends

January 12th, 2015

Over the last decade, businesses have undergone tremendous transformation. Today’s dynamic business landscape has given rise to continuously shifting business problems such as How to assess changing customer preferences? Who should be the target customer segment? What is the right pricing model that needs to be adopted for different product variants?

To address these problems, organisations across verticals are relying on the latest information available to infer and learn from, before taking a decision.

This trend has been enhanced by the data age, where organisations are progressively looking to leverage data and institutionalise data driven decision making.

With companies churning out a large volume of transactional data, capturing trillions of bytes of information about their customers, suppliers, and operations, the amount of data in our world has been exploding. In addition, social media websites, smartphones, consumer devices, multimedia content are also playing a key role in the exponential growth of big data volume.

Today, more and more firms are finding an edge, or a new niche, through their ability to extrapolate insights from data. Analysis of these vast datasets by various businesses is already creating a transformative impact across multiple sectors and is beginning to demonstrate that sophisticated analytical capabilities can result in great competitive advantage.

Ironically, even with such vast data available, its true value has not been fully unleashed.  The availability of relevant talent especially people with expertise in statistics and machine learning together with managers and analysts who know how to obtain and use insights from big data is a critical constraint in realizing the benefits of big data analytics. Therefore availability of talent is the biggest constraint in the growth of analytics. The US alone is currently witnessing a shortage of analytics professionals which is expected to reach 180,000 by 2018. Nevertheless, the analytics industry continues to grow rapidly by leveraging skillsets existing in other industries and functions, and through offshoring.

Though US remains the largest market and leading talent provider of big data analytics, growing talent shortage has allowed India and China to emerge as a key offshoring destination for analytics services due to its large, low-cost talent pool in big data analytics. As of 2013, over 80 percent of the big data talent is concentrated in US, China and India, with the future growth of big data talent expected to come from India and China. With more students opting for higher education, big data and related sill sets talent in India and China is expected to surpass the US by 2030 with comparable quality, greater scalability, and lower costs. As per our estimates, China and India together are expected to incrementally add 6 times as many Big Data professionals as the US by 2030.

Big Data Talent Hotspots

The following global locations are the talent hotspots for Big Data:-

San Francisco Bay Area: Despite high talent cost, San Francisco Bay Area is expected to be the premier destination for Big Data and Analytics talent. The High Tech ecosystem provides a favorable setting for the development and advancement of new skillsets such as Big Data. The installed talent pool is spread across Multinational Corporations, promising startups and top universities present in the region. The Bay area is home to Big Data teams of reputed global firms like Google, Amazon, Yahoo, Apple, LinkedIn and Facebook.  The applications of Big Data Technologies in these firms are wide ranging. EBay.com uses two data warehouses at 7.5 petabytes and 40PB as well as a 40PB  Hadoop cluster for search, consumer recommendations, and  merchandising.  Walmart handles more than 1 million customer transactions every hour, which are imported into databases estimated to contain more than 2.5 petabytes (2560 terabytes) of data – the equivalent of 167 times the information contained in all the books in the US Library of Congress.

The presence of premier research institutions such as Stanford and University of California ensure a steady supply of qualified graduate engineers. They offer intensive programs in the field of Big Data research. Bay area is also a cradle for new age Big Data startups such as Platfora and Adchemy.

Bangalore: By 2020, Bangalore is expected to emerge as the second largest destination for Big Data R&D, driven by its fast growing and cost effective talent pool. MNCs such as Amazon, IBM, EMC and E-bay have big data teams operating from Bangalore. Local companies such as TCS, Wipro and Infosys are also building Big Data capabilities to cater to their international clientele.

Indian Institute of Science situated at Bangalore is a premier institute involved in cutting edge research in the field of statistics and analytics. In addition, the presence of startups is enriching the big data ecosystem. Inmobi, a mobile advertisement platform headquartered in Bangalore is building digital solutions for global customers using Big Data. Mu-Sigma Analytics recently valued at over a billion dollars * has built significant analytical capabilities and employs a large number of decision scientists and data scientists.

Beijing: Beijing is home to a sizeable, economical and fast growing Big Data R&D Talent pool mainly deployed across MNCs and large local companies present in the region. Beijing is expected to emerge as an attractive destination for Big Data R&D activities propelled by its fast growing and cost effective talent pool. MNCs such as Yahoo and IBM are working on Big Data in a small but significant capacity. IBM’s Beijing center focuses on deploying Big Data Solutions locally. Large local companies such as Baidu, Tencent and Alibaba are working on Big Data applications to unlock business value. The presence of research institutions such as Tsinghua University and the Chinese Academy of Sciences fosters the local ecosystem.

Shanghai: Shanghai is still in its nascent stages as a Big Data R&D hot spot, but is expected to grow rapidly driven by talent and cost benefits. MNCs such as eBay, IBM, HP and Intel have small Big Data teams working on Big Data platforms. Baidu is the primary local player leveraging Big Data capabilities out of Shanghai. Big data adoption in startups is still in the early stages. There are very few significant start-ups in this domain. The Shanghai Jiao Tong University houses researchers in the nascent stage of big data projects.

Kiev: Kiev is home to a sizeable and competent Big Data talent pool, which is currently being used for both Big Data R&D as well as deployment services. Kiev’s emergence as hub for big data talent will be driven by low cost and well educated talent pool. MNCs such as EPAM have setup centers in Kiev for Big Data R&D. Companies such as Ciklum and SoftServe are working on Big Data applications out of Kiev. Kiev lacks significant Big Data R&D led by universities and startups operational in Big Data segment.

To conclude with business becoming increasingly competitive, it has become essential for companies to adopt to change whether technological or obtaining the right talent. Therefore, for leveraging the full value of big data, companies need to have right talent on-board.

Factors to consider while setting up a captive center.

January 8th, 2015

There are a number of critical factors that organizations looking to set up a captive center should consider. These factors will help determine not just the approach to be adopted to set up a captive but also critical details on where and when to set up the center.

The broad categories to be considered can be bucketed under five important groups. These groups include:

  • Cost
  • Talent
  • Scale of operations
  • Flexibility
  • Regulator support.

Cost: Cost continues to be the primary driver to explore outsourcing and offshoring. Broadly, the two important attributes that organizations need to consider are capital investments and operating expenses. The capital investments are higher if one were to set up a direct presence in a country. The capital investments will go towards paid up capital to set up a legal entity, setting up a physical infrastructure including office space, interiors, telecommunication infrastructure, it infrastructure, lab infrastructure etc. In addition to the capital investments, there will be variable costs incurred on a monthly basis. This will include people costs, vendor costs, travel costs and regulatory costs- such as taxes. Upfront capital investment required to set up a center is a key decision driver for organizations exploring setting up a new center. There isn’t a fixed metric to compute this cost. It varies by the type and scale of captive and the culture of an organization. Organizations that believe in having best in class infrastructure for their teams and world class facilities will obviously have to invest a lot more on capital cost. an important attribute to keep in mind when it comes to capital investments is that the upfront costs involved will be planned with future scale in mind. That is one will have to invest for an infrastructure of 300 people, but the full capacity utilization will happen only at the end of 3 years.

Talent: Talent is an important attribute to consider while setting up the captive. It is important to define a clear charter for the captive center and then hire talent that can help deliver on the charter. The talent required in the center to drive innovation is very different from the talent that will be hired if the charter for the center is to provide cost arbitrage. It is very important to structure the center in a manner that allows one to offer a well-defined career path to individuals. The center needs to have a clear charter to able to offer a growth path to all employees. It is also important to understand the effort that will be required to groom senior management resources. Unless senior resources are groomed, it will be very hard for the center to deliver on the objectives and goals set for it.

Scale of Operations: The scale of operations is a critical attribute to setting up a captive center. It is an important factor in the decision making. If a center doesn’t have sufficient scale, then it is hard for it to be viable. A subscale captive not just impacts the cost arbitrage but also makes it hard for a captive to offer its talent a good career path. If a captive has scale, the captive center has the ability to go beyond cost and generate value. The value generation can be in the form of innovation both at product and process level. Scale gives freedom of budget for local leadership to experiment with ideas and to showcase value to the parent.

Flexibility: The importance of flexibility on a chosen approach offers is a crucial parameter in choosing the approach to setting up a captive. Going the direct route gives one the flexibility to pick the location, and organization structure. An organization can drive greater accountability and ownership with its own center. Organizations can also build centers of excellence that are involved in critical parts of the globalization roadmap. With a BOT, this flexibility is missing. The location choice is restricted by the footprint of the vendor partners. Though one could still work with a service provider to build a center of excellence, the focus areas might be very different from the centers of excellence that would be created for the in-house center

Regulatory Support: A most times the decision to set up a town center is also determined by the regulatory support on offer. If a local government were to give tax incentives and other benefits, there are reasons to consider setting you own center than go with a BOT or a vendor partner. A crucial decision factor is Labor Laws in the country an organization is setting up and its impact on ramping up and ramping down of teams. If the laws make it hard to ramp down teams in case of an organization realignment globally, most companies would not choose to set up a direct captive.

These are a few crucial factors to be considered in choosing the approach to setting your presence in a low cost location. Organizations should evaluate their business requirements and weigh the benefits of setting up a center on the basis of the parameters enumerated above to create an optimal globalization roadmap.

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Approaches to setting up Engineering and IT captive centers

January 6th, 2015

There are a number of key advantages for organizations to set up a captive or global in house center (GIC) for Engineering, IT or Shared Services. The key drivers of setting up a GIC have changed in the last 5 years. While the primary driver to set up global In house centers remains cost and access to talent, we do believe there is a greater focus on defining greater value creation in the long term from such facilities.  Organizations are hoping to create value from their center in the form of innovation for new products and services, process improvements and access to newer markets adjacent to the location where the facility is being set up.

In -sourcing as an option continues to retain some of the main advantages over outsourcing to a vendor in a remote location. Having an in house center allows for faster decision making on delivering core services from an offshore location. It is also the preferred option when there is a need for IP and business knowledge sensitivity.  In house centers still provide you with a major advantage when it comes to building and retaining specific domain knowledge for an industry. Captives also give organizations a local footprint to understand emerging markets and potentially drive innovation for the local markets.

Some of these reasons have been the key drivers that have resulted in over 2000 R&D Centers come up in India and China over the last decade. Though there was a significant drop off in the number of new centers being set up in India and China from 2011 -2013, 2014 has seen interest peak amongst global organizations to set up their own presence in emerging locations. The drop in new centers had less to do with any fundamental change in the core value proposition of having an in house center. The lull was more driven by overall downturn in business and a focus on getting the product market fit right in a rapidly evolving market landscape.

Over 20 new centers came up in India in 2014, and we expect this number to more than double in 2015. We have seen organizations consider four broad approaches to setting up their own presence in India/ China:

The first approach is to set up their direct captive center. This approach involves setting a legal entity in India with the team on the direct rolls of the company. In such an approach the entity is a wholly owned subsidiary of the parent. While this approach has many advantages, the approach also takes significant time. In our experience it can take anywhere between three months to six months to get a Greenfield center off the ground. A major concern with setting up a center on your own involves the capex investments that need to be made upfront. In addition to that there is a need for a clear charter for the center and the center needs to have a roadmap to have sufficient scale to be viable.

Another challenge with setting up a direct presence is that the organization will have to make significant investments in branding in order to hire the right kind of talent. This takes time and significant effort. Also, there is significant pressure on the center to deliver to expectations on day one, else they run the risk of having multiple internal teams second guess the decision to set up a direct presence in a remote location.

The second approach preferred by many organizations is to do a build operate transfer contract with a vendor. In this approach there isn’t much of a capex investment upfront for the organization driving a globalization program. This approach has the advantage of leveraging the service providers proven recruitment and training engine to get the center up and running. The BOT also comes with the advantage of proven delivery capabilities in the form of proven processes of the vendor.

A BOT is typically exercised after3-5 years with the organization having the flexibility of rebadging all or part of the staff at the vendor into their own premises. BOT is a very flexible model in that it allows an organization to delay a transfer decision in case there isn’t complete buy in for going in for an own center. However a major challenge with a BOT is that the organization might not be able to attract the right kind of talent that it wants, because it is dependent on the vendor’s brand and hiring engine.

Apart from these two most prominent approaches to setting up a captive presence, we have observed organizations adopt other approaches to set up a center with varying degrees of success. One of the common approaches taken is to look at acquisition of a small service provider in a remote location that has the right kind of skills. Alternatively, organizations may look at acquiring another organization’s captive that might be looking to consolidate its operations across multiple locations. Both these approaches come with their own pros and cons. Also these approaches require significant time and effort on due diligence to ensure that the acquisition being addresses the talent, skills and cultural compatibility requirements.

Recently, we have observed a phenomenon where organizations are looking at India and China purely from an innovation standpoint. Organizations have setup incubators or accelerators for start-ups . In this approach, the objective is to encourage start-ups to build solutions in areas of interest to the organization and support them through funding, mentorship and access to customers. This is a more recent approach and the value derived from such an approach is beyond cost. It is a good way to innovate, and access new markets. This approach is less of a captive approach and more of an extended innovation engine that helps drive open innovation.

Irrespective of the approach, we foresee 2015 to be the year global in house centers are back in the reckoning when it comes to strategic planning for large global organizations.

Digital Business Continuity Planning

December 12th, 2014

In digital age, the concept of Business Continuity has gained immense popularity as there are many more points of failure than there earlier used to be. The vast array of technology that we use today and the importance of digital data have made it essential to keep your data safe and accessible.  It is no more just about backup, it’s about ensuring that information can flow again quickly. From simple Word Docs, PPTs, spreadsheets, database, to pictures and videos, all data needs to be protected, easily retrieved and shared. Therefore, it is essential to have an organization to have a well-defined Digital Continuity Plan under Business Continuity plan.

Digital continuity ensures that information is complete, available and useable by those with a need for it. In addition, it also ensures that information is not kept longer than required.

Megatrends in Digital BCP

  • Movement towards knowledge workers and people with critical skill sets
  • Transition from physical assets to digital assets
  • Movement from producer controlled to market and consumer driven economy

Best Practices in Digital BCP

  • Movement towards knowledge workers and people with critical skill sets

ü  Identify critical skill sets and leadership levels

ü  Succession planning

ü  Identify skills gaps

ü  Build competencies

ü  Periodic Review

ü  Review legal agreements with employees

  • Transition from physical assets to digital assets

ü  Deploy a mobile application management (MAM) strategy to protect enterprise apps and data

ü  Consider using two or more service providers to host your IaaS, PaaS, or SaaS.

ü  Verify and authenticate users with numerous technologies

  • Movement from producer controlled to market driven economy

ü  Own your search engine results page

ü  Limit access to business social media accounts to critical resources

ü  Develop channels of communication with customers

ü  Establish a crisis communication response team

Business continuity planning offers value to organization by developing capability to respond and recover from a disruptive scenario. Even if you are of the view that ‘’it will never happen to me’’, is it worth taking a risk? Business continuity planning should not be a time –consuming process, rather it should focus on aligning preparedness   to the strategic needs and obligations.

Business Continuity Planning Best Practices

December 9th, 2014

Zinnov recently hosted a working session with its key customer stakeholders to understand Business Continuity Best practices being used by global organizations. The discussion had participation from large technology organizations with a global footprint across multiple locations.

The Session focused first on defining BCP within the context of technology organizations. An accepted definition within the group was Business Continuity Plan (BCP) ensures that critical products or services are continually delivered to customers even if there is disruption in business due to various internal or external factors.

Most organizations agreed that Business Continuity planning includes:

1. Plans, measures, alternates, and arrangements to ensure continuous delivery of critical services and products to customers, allows an organization resume its operations, and recover its data & assets.

2. Identifying key resources including personnel, equipment, information, assets, financial allocations/resources, and infrastructure critical for continual delivery of services and products

The group focussed on the key risks faced by every organization. Some of the BCP risks highlighted by the group included

• Natural disasters such as earthquakes, fire, floods and tornadoes

• Accidents

• Malicious activities such as vandalism, theft, and fraud

• Technical failure such network and power outage

• Cyber-attacks and hacker activity

The discussions focused on addressing some of the key misconceptions prevalent in organizations on business continuity planning.

1. A major misconception within organizations is that insurance is an adequate and sufficient enough component of BCP.

2. Another misconception within organizations is the belief the most BCP risks can be managed with the support of employees.

3. Another key challenge to BCP is the belief amongst senior management that investments made towards BCP tend to exhaust company resources.

The group discussed at length and settled on some of the key best practices for Business continuity planning:

1. Define Crisis Management, Disaster Recovery, Business Continuity Planning, and educate all the employees about the same. This will make employees aware of what they are expected to do in the scenario of a business disruption in order to maintain delivery of essential operations.

2. Assess critical organizational risks through vulnerability assessment i.e.

• Business Impact Assessment

• Risk Assessment

• Vendor Assessment

• Work Force Assessment

3. Acquisition risks should be into taken into consideration will designing business continuity plan

4. Business continuity plans should be made part of contract agreements with customers and 3rd party service providers

5. Establish a BCP team focused on designing/compiling a business continuity plan which identifies actions that an organization should take to minimize the adverse effects of potential disasters.

It is essential to identify the lines of authority, succession of management, and delegation of authority. For example: A BCP manager could be appointed for each business unit with a BCP coordinator for sub-functions. All BCP coordinators can report into a regional BCP coordinator.

Ensure that communication protocols are well-established for BCP coordinators with employees and senior management.

6. Define roles and responsibilities of team members in BCP team.

For example: Role of a regional BCP coordinator should be to educate employees, draft BCP policies, conduct dry runs, perform business impact analysis, and manage down-time.

Ideally, crisis management and disaster recovery teams should report into the BCP team for better coordination.

7. Create and share distribution lists for crisis teams, BCP managers, and executive sponsors to communicate about eventualities.

8. Ensure redundancies and geographical distribution of resources with critical skill sets to effectively manage down-time in a region.

9. Synchronize data centers to create backups at different geographic locations

10. Run BCP simulations to check the readiness of the plan in place

11. Build and enable ‘work from home’ capability and maintain metrics for the difference in BI created because of this capability

12. Create demilitarized zones with differential access permissions for BYOD scenarios

13. Monitor use of open source code in product releases

14. Centers outside headquarters should align to the Global BCP strategy. In addition, they should also allocate sufficient funds for BCP in their planning cycle.

Business continuity planning has become more critical in a globalized environment. The impact of any risks on global customers and employees make it essential to implement a BCP program within any technology organization.

Insights from Zinnov- New York EDT Roundtable.

November 26th, 2014

Zinnov released its Enterprise Digital Transformation report a couple of weeks back. As part of the launch activities we hosted a series of roundtable discussions with key decision markers in Bangalore, Singapore, Mumbai and New York.

The NY roundtable discussion was hosted at the Hyatt 48 LEX, at Lexinton Avenue in NY. We had a very good group of decision makers attend the session. This included stakeholders from both traditional businesses like AIG and Bosch as well as technology & services vendors such as IBM, Mphasis etc.

Traditional organizations strongly felt that they would “Buy” than “Build” digital solutions from scratch. They felt that they just can’t keep up with the new technologies and won’t be able to attract the same talent hired by companies such as Adobe and Salesforce

Traditional organizations also mentioned that they have tonnes of data about the customers. They buy data from companies such as Acxiom who provide customer specific data. They use this data to dynamically configure the website based on user profile. Once the user opts to any kind of product or service plan and give the company permission to run background check, they get access to even more data. They current use a combination of Salesforce.com, Adobe Marketing cloud and data source from companies such as Acxiom

Large services firms like IBM and Mphasis are using their own enterprise social networking site for knowledge sharing. Their view is that the old model of knowledge management where people access terabytes of data is moving to social models where employees use social platforms to reach out to folks who might have access to the data.

Automotive firms have a number of IOT case studies where they are able to use the telematics data from the car to build customer focused services. Digital transformation initiatives in the automotive vertical seems to be driven by the desire of OEM’s to offer digital services to their consumers.

Start-ups are also building digital transformation related products – We had one start-up that was building a learning platform to make it easy for enterprises to enable social learning. One start-up has built a platform that makes graduates employment ready by providing them real-projects from freelancing portals kind of platforms.

One of the interesting case studies that came from the session was about digitization of assessments in schools. A large number of US schools outsource the exam/assessment part to certain vendors. These vendors takes all the answer sheets from the students and digitizes them. They then split the answer sheets by certain question categories and send them to individual teachers at a back office. This is like the Ford assembly line – One teacher will only correct answers to 1 or 2 test questions across 1000s of students. They also have some technology that provides guidelines to the teachers to ensure uniformity. The assessment scores per student is then aggregated and the mark sheets are printed out. This has brought in huge efficiency gains for the vendors. This is a great example of how the overall value chain was changed through the use of digital technologies.

There was discussion on the organization structure – There were different schools of thought. One proposed approach was an incubation approach where new solutions are incubated by a separate team not connected to the IT team. Post the initial success, the incubation team transfers it to the IT team and moves to the next incubation. The incubation team’s role is to rapidly test new ideas and then transfer to once that works/proven to the IT team to scale.

The insights from the session were a validation of our findings during the course of the study and also gave some new perspectives.

“Step Up Program for Women in Middle Management ”with Regina Lee, Corporate Vice President, ADP

November 24th, 2014

Zinnov has been hosting a series of working sessions titled “Step Up Program for Middle Management Women”. The objective of these working sessions are to help women in middle management roles make the step up to become leaders.

As part of our series we hosted this session at the ADP office in Hyderabad for Middle Managers. The session was open to all companies in Hyderabad and we received participation from broad ridge, CA Technologies, ADP, Progress Software etc. This session was unique as Regina Lee the Corporate Vice President at ADP spent half day with the team of 20 odd participating women to share her experiences and thoughts on how she made the step up as a leader.

Regina Lee was truly inspiring! She shared her professional challenges with the group, and it was surprising to know that most of the women shared similar challenges in their careers. The key takeaway was how best to handle them.

Regina related questions with her own professional challenges, and discussed best ways of addressing them.

Some of the key takeaways from Regina’s session were:

  • Mentors matter! Leaders who inspire you, have worked with you, believe in your potential, are best suited for mentors
  • A good manager is a boon to growth. A bad manager is a learning to be a good manager yourself.
  • Always accept mistakes and learn from them, instead of shifting blame or looking for opportunities to escape
  • Give and take help from fellow colleagues. Invest time in building a relationship on mutual help
  • Good leaders give and receive feedback, for both successes and failures.
  • Don’t shy away from being aggressive and ambitious enough to take that promotion/role/challenge
  • You should know when you are crossing the line and being over-aggressive. When you are completely self-aware of your strengths and what you bring for the team, then you know whether you are being unreasonable in aiming for that role!
  • You can use tools like 360 degree feedback to perform a self-assessment of how your colleagues perceive you, and build upon any gaps
  • Always be prepared for any opportunity that may even come on your way unexpectedly, never undermine any of them. Think through an elevator speech for yourself
  • Public speaking gets better with practice, we should try and take up as many opportunities as possible. Always identify your audience and structure your communication
  • Identify your personal brand. It takes time and consistency in building a brand
  • People you coach, help market your brand.
  • Allow juniors to make mistakes and learn from them. Being too critical of their mistakes, hampers their true potential. Your team should understand that you should be the first to be informed of any mistakes, and they shouldn’t be hidden for later discovery
  • Learn to delegate, you cannot do everything on your own. There is a thin line between micro management and being
  • If there is a team building activity which isn’t gender neutral, then take the initiative to promote an alternate gender neutral activity
  • To counter situations where there is a unconscious tendency to associate an intangible style aspect with women colleagues (for example, she is too difficult to work with!) you should ask how the absence of the intangible would have resulted in an alternate result
  • There is always a tradeoff between time for work and time for family. Don’t believe that you are being uncompetitive by prioritizing family over work at times. Try and achieve the right balance by scheduling appropriately. For example, if women find it difficult to stretch from 6 PM to 8 PM as they need to spend time at home then they can schedule all evening calls/activities after 9 PM. Colleagues understand the dual roles that women play, and are always willing to adjust
  • If you really love what you do at work, you would find it easier to balance work and home. When you are unsatisfied at work, you are more likely to quit the battle quoting family priorities.
  • Women often need a strong support system from family to juggle work and home priorities. While some of us are lucky to have this support system, the others need to plan and work a way of provisioning this support
  • While many organizations have trainings/sessions for a wide women audience, what’s lacking is a focused approach to selected set of women middle managers’ professional growth into senior leadership

The session was extremely insightful with most of the attendees benefitting from learning from the experience of a seasoned leader.

The session was extremely insightful with most of the attendees benefitting from learning from the experience of a seasoned leader.
Step up Program for Female Middle Management