Few weeks ago, I had raised a concern that many of the Indian IT services CxOs dont talk about Technology and merely interested in topline/bottom line issues. And few weeks later, I had also highlighted the Technology leadership displayed by Steve Jobs in Apple's earnings call.
And this week, Here is Vineet Nayar talking about Cloud in HCL Analyst conference. Its heartening to see an Indian IT services CEO talking about technology. And not only for this instance, Vineet has been articulate and attracting media attention for quite sometime now, due to HCL's tremendous growth in recent years, renewed marketing and Vineet himself talking about company's strategy convincingly.
Now coming to the main issue of 'What' exactly Vineet talked about Cloud. And that where it gets interesting. In the interview, Vineet explains why he is not so excited about cloud. And He states the fact that there is no disruptive technology behind cloud and its just a business model that is packed in a new format. [Oracle CEO Larry Ellison ranted on Cloud few years ago on similar grounds]
Very True!. In fact, I had mentioned this very same issue in 2008 stating that Cloud is indeed a rocket science and there is no magic pill that would enable someone to become a cloud provider from day one. Pls note, anyone can become a cloud consumer instantly. But becoming a Cloud provider is not so easy!. And there are genuine technical challenges in being a authentic cloud provider.
The industry is still in early stages in discussing/debating and defining what an 'authentic' cloud means in 'technical' terms.
Leaving the semantic definitions behind, Cloud indeed brings visible economic benefits to Enterprise IT. And if Vineet, as a CEO of an IT services company, is concerned about his customers (most of them being Enterprise IT), why don't his company take the leadership and pass on the cloud benefits to them?. If Cloud is an opportunity to create a new value for Customers, why dont we adopt it? Why should he wait for a disruptive technology to arrive to create a new value?.
Vineet disputes the value proposition of Cloud, because it fundamentally conflicts with his traditional business model. And the traditional IT services business model is threatened. Period.
In his new book, Vineet reveals HCL's new strategy - Employees First. Isn't it obvious?. In a people-intensive business model, your employees have to be first!. But, then, there are umpteen number of challenges in sustaining this strategy such as Growing wages and increased attrition,etc.
Time has come to revist the linear, people-intensive IT services business model to a non-linear, technology-intensive business model. Only then, IT services can reduce the cost of existing services and introduce new value added new services. And that exactly What Cloud offers!. It provides a non-linear business services platform for end customers with no or less strings attached.
I strongly believe that Indian IT services firms can come up with service innovation backed by Technology. For example, some of the IT service companies are providing platform based BPO services or few of the companies provide business products.
Am glad that Vineet talks about 'Employee First'. But, it would be much more meaningful if Technology also takes a slot in the Strategy.