As for Pai pointing at Infosys PAT .. they're in that moment where wile e coyote is perfectly safe, only he's stepped off a cliff, standing over thin air and just about to raise a sign that reads "help"
I'm sure Deepak Shenoy can poke a few more holes than I can but .. Here are the rest of the numbers that blowhard / great financial genius missed out on http://www.indiainfoline.com/article/equity-earnings-result-commentary/infosys-q1fy17-consolidated-net-profit-declines-4-qoq-to-rs-3436-crore-in-line-with-estimates-116071500326_1.html --srs > On 22-Oct-2016, at 12:35 AM, Sriram Karra <karra....@gmail.com> wrote: > > So many thoughts on this topic... having spent 8 years in various roles in > this industry.... Just a few quick observations here (in no particular > order) on the specific challenges facing the Indian IT industry and some of > the comments in this thread: > > - IT Services is not all about server maintenance or routine sysadmin > work. Application Development & Maintenance (of bespoke systems), Product > Engineering, Customisation and deployment of complex packages (like ERP > systems), and so on cannot be automated with the current state of the art, > nor are they dull or monotonous drudge work. I have myself worked as a > contractor for Cisco, maintained critical parts of their embedded OS (the > original IOS), developed thousands of lines of code, and new features, that > have powered (in some ways quite literally) the Catalyst 6500, a cash cow > for Cisco for nearly 15 years. It was a great experience to see engineers > from humble backgrounds perform high quality engineering for Cisco even in > its heyday. > > - Innovation comes in all sizes and shapes. We romanticise the Google / > Apple style of innovation at the expense of other forms. When my former > boss, at age 34, convinced John Chambers and Cisco at its peak (mid 90s) to > offshore product engineering work to Chennai, that was business innovation > too. The situation now is the Indian model is so well understood that there > are few levers left in negotiation, and the downward margin spiral that > Sikka keeps lamenting about are defining the mood about the industry (more > on the margins later). But this is not new either. Even way back in 2007/8 > it was clear to insiders that more innovation is required with the business > models. We started talking the language of 'Fewer Better People' to change > the customer mindset from hourly billing to more outcome based pricing > models. Many companies have seen success in these endeavours. But no clear > industry-level breakthrough has emerged, and that is a worry. Maybe it > won't, but that does not mean the death of the industry. > > - What is certainly lamentable is these companies have gotten left > behind in the latest technology trends and by not paying enough attention > to building scalable businesses. But the threat of automation and "AI" is > somewhat exaggerated: the domestic IT demand is just warming up and you can > be sure that journey is going to start at the bottom of the pricing > hierarchy; in technology the next wave is always round the corner and they > only need to survive till the next wave comes around; > > - Mohandas Pai's response has some valid points. Infosys PAT was 21.9% > in FY 2015-16, which is very respectable. For comparison: Google's PAT for > FY 2015 was 21.8%. Accenture's was 12.5%. There is scope for players to > change their cost structure, remove dead wood, and change the reward system > to make them more competitive viz a viz the MNC biggies. But it is an open > question on whether they can pull off the execution. Maybe most won't, but > I do hope at least a few will, and we will all be better off for this > shakeup. > > > On Sat, Oct 15, 2016 at 8:52 PM, Srini RamaKrishnan <che...@gmail.com> > wrote: > >> Comments? >> >> >> http://www.livemint.com/Opinion/737W8zcjPA6lGWIajRCd6K/Indian- >> software-dies-at-17-from-failure-to-grasp-future.html >> >> >> Indian software dies at 17 from failure to grasp future >> The Indian software services industry died on Friday after a short >> battle with newer digital technologies >>  >> A slowdown alone wouldn’t have stopped the Indian industry if it had >> been able to embrace ‘smac,’ or social, mobile, analytics and >> cloud-based technologies. Photo: Abhijit Bhatlekar/Mint >> >> Singapore: Seventeen years ago an Indian man from New Delhi mesmerized >> the technology departments of global corporations with a doomsday >> story many times more puffed up than the luxuriant crop of hair he >> sported. >> The latter was a wig, and the former was just bad science fiction >> packaged by consultants as a $600 billion hair-raiser. But Dewang >> Mehta, the chief lobbyist for India’s fledgling software services >> industry, carried off both with aplomb, convincing businesses that at >> the stroke of midnight of the new millennium, their computer systems >> would crash because old programs measured years in two digits instead >> of four. The solution, he persuaded them, was to let a horde of >> techies from Bangalore and Hyderabad go through each line of code and >> fix the Y2K bug. >> >> That was the birth of India’s massively successful software services >> industry, which died on Friday after a short battle with newer digital >> technologies. At the time of its demise, the business was worth $110 >> billion in annual export revenue. >> The first hint that the end was near came on Thursday when Tata >> Consultancy Services, the biggest Indian software vendor by market >> value, announced a virtual stalling of its business in the September >> quarter from the previous three months. After Infosys followed up by >> slashing its full-year revenue guidance for the second time in three >> months, it was time to turn off the ventilator. >> >> >> #Infosys revenue growth pre-Lehman >> >> A coroner’s inquiry unearthed three signs of decay, the first of which >> shows how Indian companies’ cheap-talent-fueled growth ran out of >> breath. In the four quarters before the collapse of Lehman Brothers, >> Infosys saw revenue increase an average 29% in constant-currency >> terms. Back then, Dublin-based Accenture’s growth was just half as >> high. But there’s nothing exceptional about Indian companies’ >> expansion anymore. All that investors have heard from managements this >> year is gloomy commentary on how challenging it’s become to get >> clients to open their wallets. When the companies do make news >> nowadays, it’s more often for dodgy business practices, regulatory >> slaps on the wrist, and senior-level exits. >> >> A slowdown alone wouldn’t have stopped the Indian industry if it had >> been able to embrace “smac,” or social, mobile, analytics and >> cloud-based technologies. But the vendors wasted so much time >> defending their legacy business of writing code for and maintaining >> purpose-built enterprise applications that they failed to make a mark >> in the new digital world. >> >> As an analysis from Mint shows, the dominant trio of Tata Consultancy, >> Infosys and Wipro between them had 1.5 times more workers doing >> digital stuff last year than Accenture. But the revenue they garnered >> was 40% less than what the latter chalked up from newer technologies. >> That makes the typical digital-tech employee of an Indian vendor 25% >> as efficient as his counterpart at the global consultant. This gap >> sets the clock back on Indian companies, which have taken years to >> narrow the productivity differential: >> Maybe it’s just banking clients and their inability to pay like they >> once did. Or perhaps it’s a combination of weak global growth, Brexit, >> protectionism and Donald Trump’s vacillating stance on US visas for >> Indian technology workers. Hoping that turbulence is temporary, >> investors are still paying a hefty premium for future growth. They may >> get lucky for a while. Still, a dead-cat bounce from delayed orders >> coming through would hardly count as proof of life. >> >> The millennium scare got Indian software a foot in the door at global >> corporations. But now the shoe is on the other foot. Robotics and >> artificial intelligence are putting the vendors’ labour-intensive >> business at risk of obsolescence. Even if the concern is as puffed up >> as Y2K, with plenty of growth candidates in the Indian start-up world, >> at least for some investors it may be time to back new horses rather >> than flog dead ones. >> >>
