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Need for reengineering IT outsourcing – will TCS and Satyam chiefs elected as NASSCOM leaders be able to save Indian outsourcing boom?
Balaji Reddy
Apr. 1, 2005

What happens when a technology become dinosaur? Yes we call it the legacy system. India’s IT outsourcing has become a genuine “vintage car” – better put a legacy system waiting for a complete reengineering. The lack of talent, rising prices and lack of innovative products is hitting Indian IT companies hard. How long can you survive on exploiting cheap labor opines experts and International outsourcing pundits.

Indian IT needs new leadership. Otherwise India IT Outsourcing Inc. will face the same stagnation that Microsoft faces. Tata Consultancy Services (TCS) chief S. Ramadorai was on Thursday appointed chairman of the National Association of Software and Service Companies (Nasscom), the country's IT industry umbrella group. B. Ramalinga Raju, chairman of Hyderabad-based software maker Satyam Computer Services, was appointed vice chairman of Nasscom for fiscal 2005-06. The million dollar question is can these old guns who created the legacy of “taking someone else’s requirements and sit and write code blindly” be able to guide India into the next phase of software engineering?

In Europe and America, Oracle (Paeoplesoft) and SAP faces a strange newborn competition from smaller companies that they never thought about. Large back office processing systems based on large traditional databases are being challenged by smaller Web based tools from companies one hundredth the size. India’s outsourcing will be now slowly replaced by US and European companies that have mastered the techniques of software engineering productivity in the last few years. Three or four very talented software engineers who also understand business and systems analysis can replace fifty Indian coders. The software engineering field is finally going through the maturity process where coding and traditional testing is replaced with business and systems analysis driven system generation through “configurations”. The new technology is astounding and will employ far less people but those who will work as software engineers will make four times what they make today.

Can Ramadorai of TCS and Raju of Satyam provide that kind of forward looking leadership as India faces the competition storm from all directions? Experts say these legacy systems reengineering experts will provide traditional leadership but will need others in their team to really compete with smaller and sharper companies from America and Europe.


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