Developing nations are lucrative marts (interview with GANESH NATARAJAN)
Ganesh Natarajan, chairman, National Association of Software and Services Companies (Nasscom), and deputy chairman & MD...
Oct 08, 2008
Ganesh Natarajan, chairman, National Association of Software and Services Companies (Nasscom), and deputy chairman & MD, Zensar Technologies Ltd speaks to FE’s C Jayanthi on emerging economies and emerging companies, and the keen interest that India’s IT companies have in the emerging economies.
In what areas is Nasscom involved with the Bric countries?
Nasscom is constantly encouraging its members to explore alliances and joint ventures in emerging markets, which provide an excellent hedge to the variable demand situation in the developed world. There have been frequent delegations to China and the focus on the domestic market in India has been there for some time, which has already paid rich dividends. Russia and Brazil are relatively less explored though as part of our global expansion plan which includes eastern and central Europe as well as Latin America, we will certainly explore opportunities in these markets as well.
Is it exclusively IT?
The opportunities are there in both the product and services segments of IT as well as consulting and business process outsourcing. Some locations like Russia, Latvia, Estonia and Romania can join Poland and Hungary as good places to set up near shore IT and BPO centres and the fast-maturing products industry in India will find readily accessible markets in Bric.
What are the bottlenecks that SMEs (like most IT companies are) experience in emerging countries?
A lack of understanding of cultural nuances and the right approaches to establishing operations and doing business in these countries is often the reason why initial efforts tend to fail. This is particularly true of China and Brazil where the language differences compound the problem.
What is the future course for them to follow to ease out the process?
Nasscom is doing a lot to ease the process of market entry by engaging in peer to peer dialogues and MoUs with governments, industry and associations in all these countries. There is significant research being done as well to unearth new opportunities for our members and the discussions in forums like we organised recently in the Capital provide an impetus to entrepreneurial activities in these markets.
Why are you especially targeting Bric or emerging countries?
Many companies have enjoyed significant success in emerging markets. A case in point is Zensar where the revenue from emerging markets grew at over 55% last year as compared to 30% in the traditional markets of the US and the UK. A targeted focus for chosen markets and the patience to invest and build credibility with customers has always been a recipe for success. I believe that in five years’ time, over 50% of industry revenues will come from Asia Africa, Latin America and Eastern and Central Europe.
In what areas is Nasscom involved with the Bric countries?
Nasscom is constantly encouraging its members to explore alliances and joint ventures in emerging markets, which provide an excellent hedge to the variable demand situation in the developed world. There have been frequent delegations to China and the focus on the domestic market in India has been there for some time, which has already paid rich dividends. Russia and Brazil are relatively less explored though as part of our global expansion plan which includes eastern and central Europe as well as Latin America, we will certainly explore opportunities in these markets as well.
Is it exclusively IT?
The opportunities are there in both the product and services segments of IT as well as consulting and business process outsourcing. Some locations like Russia, Latvia, Estonia and Romania can join Poland and Hungary as good places to set up near shore IT and BPO centres and the fast-maturing products industry in India will find readily accessible markets in Bric.
What are the bottlenecks that SMEs (like most IT companies are) experience in emerging countries?
A lack of understanding of cultural nuances and the right approaches to establishing operations and doing business in these countries is often the reason why initial efforts tend to fail. This is particularly true of China and Brazil where the language differences compound the problem.
What is the future course for them to follow to ease out the process?
Nasscom is doing a lot to ease the process of market entry by engaging in peer to peer dialogues and MoUs with governments, industry and associations in all these countries. There is significant research being done as well to unearth new opportunities for our members and the discussions in forums like we organised recently in the Capital provide an impetus to entrepreneurial activities in these markets.
Why are you especially targeting Bric or emerging countries?
Many companies have enjoyed significant success in emerging markets. A case in point is Zensar where the revenue from emerging markets grew at over 55% last year as compared to 30% in the traditional markets of the US and the UK. A targeted focus for chosen markets and the patience to invest and build credibility with customers has always been a recipe for success. I believe that in five years’ time, over 50% of industry revenues will come from Asia Africa, Latin America and Eastern and Central Europe.