Krishnakumar Natarajan, CEO & MD, Mindtree says IT service providers can survive by transforming themselves in the cloud era
Change is the only constant. In an ever-changing IT landscape, CIOs have to constantly meet business challenges through efficient IT adoption. With wide scale proliferation of Cloud-based solutions, there is a dramatic shift from traditional in-premise implementations towards cloud-based solution. As CIOs are actively taking their organization’s business to the cloud and adopting disruptive technologies like mobile computing, the IT service companies too have to evolve and align their offerings, capabilities and delivery models to cater to the enterprise of the future.
Enterprises have changed their focus on IT investment from capex to opex, which has resulted in more services based business spend rather than on IT infrastructure. Due to this trend the traditional or core IT services like ERP implementation, Applications Development, support and maintenance etc. have reached a plateau and are on decline in terms of enterprise spends. As they move progressively towards adopting more cloud-based services, they would concomitantly be reducing the IT investments on products and infrastructure. Cloud-based services enable the enterprise to assimilate and consume new services as a utility i.e. a subscription model. This model is very different to the traditional in-premise product implementation, where an enterprise would have to pay a fixed cost for hardware, software and implementation.