{"id":1241,"date":"2013-07-06T12:12:00","date_gmt":"2013-07-06T12:12:00","guid":{"rendered":"http:\/\/localhost\/projects\/horsesforsources\/countdown-to-commodization_070613\/"},"modified":"2024-09-11T11:32:25","modified_gmt":"2024-09-11T11:32:25","slug":"countdown-to-commodization_070613","status":"publish","type":"post","link":"https:\/\/www.horsesforsources.com\/countdown-to-commodization_070613\/","title":{"rendered":"Countdown to commodization: Why the Indians need to get on the acquisition trail"},"content":{"rendered":"
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Celebrating Cognizant's latest acquisition<\/p>\n<\/div>\n

Trying to analyze why one Indian service provider had a better quarter vis-\u00e0-vis another is becoming pretty moot.<\/strong><\/p>\n

Yes, there are various nuances clearly helping or hindering some of the W-I-T-C-H firms with certain deals, such as TCS’ flexibility to win selective large complex deals, Cognizant’s savvy US leadership team, HCL’s price aggressiveness to pillage legacy EDS contracts, and the fact that Wipro and Infosys somehow “lost their mojoes” in the kerfuffle. However, the bottom-line is clear: \u00a0The Indian services business is hurtling toward commodotization, and there needs to be a much more radical play from their ambitious leaders to alter the game.<\/p>\n

In order to highlight this dynamic, we took quarterly revenue and growth performances over the last 4 years and created a predictive revenue forecast for each of the W-I-T-C-H providers, based on the past four-year historical variances:<\/p>\n

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What this data tells us, is that the growth trajectory is now declining at such a clip that none of these providers may make the HfS IT Services Top Ten<\/a> if they continue with their current growth strategies.<\/p>\n

Why the WITCH providers can either fight for the old dollars, or revamp for the new<\/strong><\/span><\/p>\n

Essentially, what these five great firms have achieved is to create huge factories of (predominantly) young talent that can service operational technology and business process work that can be standardized, externalized and run from their Indian centers. \u00a0The simple fact that their margins have remained largely unaffected, despite increasing price pressures, is two-fold:<\/p>\n