Tags:
Journalism of Courage
It has been a hellish week for the Indian software industry. The news about fraud at Satyam broke the Wednesday before last,sparking a frantic sell-off of Satyam shares; but,after the initial dust settled last weekend,it began to be clear how high the stakes are for the rest of the sector. For a decade now India has had the luxury of looking to its business process outsourcing (BPO) and software sectors as leaders not only No 1 internationally,but as examples to the rest of corporate India. After all,they looked outwards when too many Indian companies were slow to adapt to global trends; they were largely professionally managed when too many others were in thrall to owner-managers. That example,it is feared,may lie in ruins.
Such fears are misplaced. Anyone who sees in the ruins of Ramalinga Rajus reputation a defeat for the model that IT is pioneering is guilty of unacceptable levels of pessimism. To start,there is no alternative to looking outwards for software. The sector is worth $60 billion; but domestic spending on IT is estimated by some to be as low as $4-5 billion whereas US spending on IT might be as much as $800 billion. This is Indian industrys own incentives on a smaller canvas: the consensus that external markets are central to Indian growth cannot and should not be shaken by this. Industry and government must do whatever necessary to ensure those markets are still available. And second,the fact that even in the sector considered most professional and modern,promoter-related shenanigans have been revealed doesnt mean that the model it represents is flawed but that the ideal that model represents needs to be turned into reality ever faster.
