Raman Roy is widely referred to as the father of India's BPO revolution. In 2000, his firm Spectramind (sold to Wipro in 2002) was one of the first in the country to get into third-party contracts. Now, as Chairman & Managing Director, Quatrro Global Services Pvt Ltd & Chairman, National Association of Software and Services Companies (NASSCOM), Roy sees Digital India as an growth opportunity. But, the programme's true potential can only be realised through comprehensive policy initiatives, entrepreneurial incentives and, most importantly, proper skilling.
What market segments will benefit the most from the growth in internet users under Digital India initiative?
It would be unwise to look at specific market segments. This is a rising tide and all boats, whether large or small, shall rise with it. We have to create an environment that everybody can leverage. We have to be prepared to absorb all that would be coming in like a sponge. If we are unable to do that, we will not be able to leverage the resulting competencies and capabilities. It is a humongous opportunity.
How well-adjusted are the Indian IT firms to fulfil the future requirements of women and rural India?
This digitilisation allows you the ability to add known users. Take WhatsApp as an example. India is the single largest user of the messaging service, globally. Now tell me how many classes were held to train people on WhatsApp? People have trained with each other. Digitalisation makes a service inclusive.
Its big arms embrace communities that were earlier excluded. It allows information sharing, knowledge sharing, dissent and communication. And that is so fascinating!
True, but are we adequately prepared for that kind of growth?
If you had asked me ten years ago if India was prepared for a growth in its telecommunications infrastructure, a lot of people would have answered "maybe yes"or "maybe not." I have heard representatives of private equity firms say that telecom industry in India would never take off as the average revenue per user (ARPU) was too low. However, the Indian telecom industry created a successful business model with even low ARPU. Telecom is the backbone of digitalisation and in its flowering, you see a "Made in India" model.
An army has a lot of soldiers, but only a few generals. But it is the generals who do the strategic thinking. We need to propagate those generals in the digital world of tomorrow, as they will make a dramatic difference by collapsing timelines. It was they who accelerated the growth in telecom and IT, and made them into what they are today. From the 1990s, we are now an over $150 billion industry, with around 83 per cent international contracts. The digitalisation happening the world over is being designed in offices in India. One of my bosses used to often remark, "Let a thousand flowers bloom!" Therefore, let people experiment and innovate. Eventually, some models will emerge and the best ones will win. I told the Minister for Electronics and Information Technology that we will far exceed the government's plan to make the country into $1 trillion economy by 2025.
According to Boston Consulting Group report Indian companies were under-investing in the country's digital potential. What is your take on this?
No, because our adoption of digitalisation at some levels is a global first! The money transfer that you can do from one bank account to another instantaneously, 24 hours a day and 365 day a year, is a global best practice. Thanks to the RuPay card and the backbone infrastructure that has been created, the Immediate Payment Service (IMPS) is globally the best in its class. You will be under-invested even if you increase your investment 20 times.
If you go to the macro-economic level, there are fiscal and non-fiscal incentives that you have to utilise. And, that cannot be done in a knee-jerk manner as there has to be a plan in place. What is the block chain utilisation in our ecosystem today? Zero! Wherever block chain is in use across the globe, who is writing the software? It is we Indians! But we continue to operate with the mindset that we will imbibe something only if it works abroad. The world is learning the Interbank instantaneous transfer from us. I do a lot of business with foreign banks. They do not have the same banking capabilities that Indian banks have.
We have basically created a stack of financial services with the Aadhar card too as a part of that stack. We need to promote its utilisation.
Innovation has been one of NASSCOM's key areas of focus. How successful has the initiative been in scaling up the start-up ecosystem?
We have managed to create an ecosystem. Twenty years ago, when I launched my firm, a person was almost embarrassed to admit that he had launched his own business. It was as if you had not succeeded in anything else.
But today start-up has become an accepted term. In India, you are required to be innovative. Jugaad (hack) is not given enough credit. If you nurture that innovation, it will culminate into companies. And that is what is happening today. A person in a village in Punjab started using the washing machine to make lassi because no company had made a blender that could churn out large amounts of the drink. When Maruti 800 was launched in 1983, it was said its engine could not be rebored. But an auto mechanic in Amritsar found a way to do that. Innovation was when somebody stood up and offered to make changes to software in order to protect it from the Y2K bug without ever leaving the Indian shores. In a T20 cricket match, the batting is practically a "Made in India" innovation. So, there is a lot of potential for innovation. But when we expect our kids to learn by rote, we are killing innovation.
What skill sets are required to service a digitalised India? What would be some of the major opportunity areas for IT professionals?
The digital skills will continue to evolve. What do we understand of big data, artificial Intelligence or of machine learning? I am not saying that there is zero understanding. What I mean is, five years from now, the demand will be dramatically much more and we have to train people to evolve to that level. We cannot have digitally illiterate people coming out of our colleges and leave it to the corporate sector to train them.
We do a lot of accounting work for our global customers using the US's Generally Accepted Accounting Principles (GAAP). The accounting in India is done using the Indian GAAP. Our competitors are countries like Philippines and Malaysia that have colleges that teach the US GAAP. My competitor, when he hires, can make that person a revenue producer within two weeks. But it takes me up to three months to do that.
If we want to be the back office to the world, we must at least offer optional courses to students or, at least, train professors in the US GAAP so that they can be called over to conduct classes. The ôtrain the trainerö programme is the single most important thing that needs to happen. That is where the industry and government can collaborate to play a big role. When you ask about the skill sets required, it is also about identification of those skill sets, creation of necessary content and certification.
Let me give you another example. When we launched voice-based technical help desk support in our call centre at Spectramind, the first batch of people were engineers who were qualified to handle issues. When we started growing rapidly, we realised that there were not many well-spoken engineers available. We then started hiring science graduates. When we could not find any more science graduates, we devised a test with help from the academia to determine if a job applicant had problem-solving technical capability. Soon we were imparting technical skills to the selected humanities graduates. Please do not get me wrong. I love the Indian Institutes of Technology (IITs). But this is not about a few hundred IIT graduates. It is about millions of students whose skills need to be elevated.
How serious is the skills gap and what would be some of the ways to address it?
It is a very serious issue as it can derail our financial services, IT, retail, almost anything. Today an automaker or a hotel chain is more of an IT company than anyone else. A frequently cited example is that of Uber as the largest travel company. But it does not own a single car, it only owns a piece of software. That is where the future is. Can we be up to it? I think we can. But that will require policy initiatives and entrepreneurial incentives.
What is the total number of people required to be re-skilled?
Within the IT industry, 40 to 50 per cent of our workforce require re-skilling. The IT industry employs about 4 million people. Outside of the IT industry, Mackenzie has done a study for the country. I think the number is in excess of 20 million.
What is the most important ongoing digital disruption in India with far-reaching socio-economic benefits?
The wage levels will undergo a change. What we talk of as the average in a bell curve, will become much flatter. I am not saying that the disparity in living standards is going to reduce dramatically, but the mode value, the move towards the middle, will be much higher because more equal opportunities will get created. Another big change that I see is that with the ability to work from anywhere, exodus towards cities will start petering out.
What will happen to research and development (R&D) if India becomes the back office hub of the world?
R&D will never happen for the sake of R&D. It will happen only if there are commercial benefits. We have to allow people to exploit their innovations. Young people have to believe that they can innovate to come up with something new. Today, R&D happens only as part-time work. Many Indian companies claim to be doing so only for the purpose of availing tax benefits. But you will see commercial exploitation of R&D happening in a digitalised India.
- Manish Pant