A situation of crisis presents both difficulties as well as opportunities. This situation of COVID-19 crisis isn’t any different in this aspect. We believe that, while the world will no doubt face economic challenges, the post-COVID-19 world will also offer three sets of interesting opportunities for IT service providers.
Opportunity #1: Rescue
Enterprises that have borne the frontal assault of the pandemic will need significant help to recover. They will look for an infusion of cash and engage in deep cost-cutting. Further, as governments across the world ease liquidity and lower the cost of capital, enterprises will seek financial engineering solutions from their IT and BPO providers.
Key opportunities will include asset-leveraged IT infrastructure deals, rebadging of existing workforces(Re-badging by a company is having their employees continue to do work for the company, but not as its employees, but instead as employees of another company with which the original employer has a re-badging contract), and post-M&A integration support in industry consolidation scenarios. We expect these opportunities to come up in the travel, transport, and hospitality industries.
Opportunity #2: Revitalize
The disruptive phenomenon of COVID-19 will underscore the need to move to alternate, digital-friendly business models for many industries. Sophisticated enterprises will want to accelerate their digital transformation initiatives for a variety of reasons – to recover lost time, to lower the cost of customer service, and to de-risk their traditional business models. Digital disruptors will sense weakness in their competitors and will seek to accelerate their expansion plans.
We anticipate key opportunities in the shape of IT platform modernization, digital product engineering, and digitalization of front-office functions in industries like financial services, retail, and consumer goods. These were initiatives that most enterprises were already seeking to scale. As they go after them with renewed vigor, service providers must find ways to construct self-funding, agile journeys instead of big bang transformation. There will be little appetite for the latter.
Opportunity #3: Repetition of zero
COVID-19 has fundamentally altered risk perception in the global services industry. Delivery models will need to be re-evaluated for their resilience to risks that were hitherto relegated to the “it can’t happen to us” category. Cost-conscious enterprises that stayed clear of initiatives like BYOD, VDI, and cloud-based collaboration systems now have a clear business case, albeit one they didn’t want or foresee. Key opportunities: Enterprises will need to modernize and secure their networks to enable remote working at scale, modernize and automate their datacentres, move to the cloud, and establish multiple levels of disaster recovery sites. There might even be opportunities to set up enterprise-class home/small offices for mission-critical workers analogous to how remote and branch office infrastructure has been managed.
Global delivery frameworks will be scrutinized for location concentration risks, and secure ODCs will need new operating procedures. We expect almost every enterprise to be dealing with their version of derisking.
What should be the approach of service providers moving ahead:
Togetherness is the key: Just the way everything seems uncertain for the moment and you are stressed, the same way you customers are stressed too. They require all the help and support they can get right now. They likewise comprehend that the world is flawed at present and will excuse the odd niggle. Be that as it may, they won’t excuse bureaucracy, dull change control strategies, and an absence of adaptability.
Own the moment of transformation: there are going to be a lot of uncertainties and confusion around us. But every enterprise customer will need their version of the way ahead they need to walk the path with a clear to the point customer-specific tailored plan. The plan which is most pragmatic and comprehensive of all shall win the show.
Floating the bend: At the point when race vehicle drivers approach a twist on the track, dissimilar to normal humans who slow down, they quicken. This is known as “floating the bend.” Service suppliers that keep on making insightful ventures through the inescapable demand deceleration will develop more grounded and better situated to serve the core demand themes of digitalization and IT modernization. Automatic cost control responses are a snare. They will just smother advancement and push specialist co-ops further down the hierarchy. Most importantly, service providers need level headed leadership– it would be an immature board that passes judgment on the executive team on a post-COVID-19 downturn. Remember: it’s not about the fall, it’s the manner by which you ricochet back.
Shubham Mahla: A B.Tech graduate who is currently pursuing his MBA from Institute of Management, Nirma University is associated with J.Hirani as an intern. His keen inclination towards Finance and passion for learning has persuaded him to explore the field with excellent work in research and application tools. His contribution in this article has helped him to develop holistic deep insights.
Parth Hirani is a leading strategic advisory practice at J.Hirani & has helped various organizations align strategies across continents. A social & collaborative sapien by nature. He enjoys being a full time “dreamer” & loves challenging “possibilities”.
Success mantra- “We believe it’s possible; while maintaining flexibility on “How” we are “Rigid” on our “Goals”
About J.hirani: J.hirani is a Strategic Transformation team which works as a growth partner for different organisations in various industries by providing services like Agile transformation, Scenario mapping, Strategic alignment, Balance scorecard, Digital transformation, Incubating new ventures, Operation excellence and Aligning human capital.
©J.Hirani, Post COVID-19; Potential opportunities for India’s IT&BPM sector, June 2020. All rights reserved.