1. According to Nasscom, India’s IT industry is insulated from the financial crisis that has hit many economies globally, and companies here have not stopped hiring either. According to you what will be the impact of the current economic slowdown on software services industry in India?
This economic slowdown is surely going to have an impact on the software services industry as with all industries. People who claim that the IT industry is not going to be affected are fooling themselves. Cost cutting is the order of the day. At the moment confidence is shaken in businesses and new projects are going on hold. A contrary view is that more outsourcing will happen since people want to save costs.
2. In what ways will the economic slowdown impact Neev Technologies?
There will be no immediate impact on Neev Technologies, as Neev is not highly US centric. The United States accounts for only a small chunk of Neev’s business. Neev has clients spread across Europe, the Middle East and India. Europe is not yet saturated in terms of outsourcing and businesses there are looking at outsourcing more work to cut costs on account of the recession.
3. What steps are you taking to minimize the economic impact to your business?
Neev too has taken a few measures proactively to minimise the impact of the recession. We are cutting costs aggressively and reducing overheads. For sales, we are shifting from the retainer model to a commission model. We have started sharing risks with our vendors and partners.
We are trying to become more efficient as a ‘Software Development’ organisation. The focus is now on increasing profitability, rather than increasing revenues.
4. What steps are you taking to minimize the impact on your employees?
At present, we do not see any direct impact on employees. The economic slowdown has not yet come to that level in India where individuals will get affected. I do not see a problem at an individual level in the near future. We are not looking at downsizing at the moment, but yes growth may be slower. We are still recruiting for a few positions.
5. How have your priorities changed on account of the downturn? Will you continue to focus on adding more client accounts and setting foot in newer geographies?
Yes, our focus has shifted from the top line to the bottom line. We are trying to increase our focus on every aspect of the business. We are focusing more on fewer geographies. We are paying more attention to our existing clients, to deliver more value for their money. We are also tapping our old clients for new projects. As always we are getting referrals from our clients.
6. There is a silver lining to every cloud. So while people are talking of the various negatives of this downturn, what do you feel are the positives of a downturn?
People will now realize the value of money, especially people in the IT industry. Earlier companies hired for numbers rather than quality. Correction was required in the mindset of people. People will now focus on performance. The quality of work will improve. Employees are becoming more conscious of their drawbacks and are looking at learning new skills, technologies etc.
7. What are some of the opportunities you foresee for players in your industry during a time like this?
This is a time when the genuinely strong companies will prove themselves, and emerge stronger. Weaker companies will perish. We, at Neev, see this as a time to excel and get ahead!