Key Takeaways From Forrester’s India CIO Summit

Forrester held its first CIO Summit in New Delhi, India on September 26, 2012. The theme of the event was “From IT To Business Technology (BT) And Beyond.” There were more than 100 attendees, and it was truly a memorable experience interacting with everyone. By the end of the day, I had received encouraging responses from attendees, as many CIOs expressed their willingness to work with Forrester. They found that no other research firm focuses on understanding how changing customer expectations affect what the business needs from them or helps them make better decisions to become successful and influential leaders. We had a great mix of analyst and CIO presentations, and the panel discussion on “Taking Your First Business Technology Steps” with our guest CIO speakers was complete bliss.

The key takeaways from the summit:

·         IT/business alignment doesn’t necessarily equate to success. The consumerization of IT and fast-changing business dynamics make it challenging for CIOs to continue to align their IT organizations with the business. The reality in today’s world is that IT must become an integral part of the business and CIOs need to develop their IT strategy in conjunction with business leaders.

·         Disrupt or be ready to get disrupted. According to Forrester’sForrsights Budgets and Priorities Tracker Survey, Q2 2012,customer expectations are the top concern among business decision-makers in Asia Pacific. Today, customers are redefining differentiation for organizations in the age of the customer and are setting the stage for rapid digital disruption.

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IBM Bullish On Smarter City Opportunities In India

 

At last week’s India analyst briefing, IBM outlined urbanization as a key factor driving “Smarter Cities” initiatives in India.

IBM expects India to invest about $1.2 trillion over the next 20 years in areas like transportation, energy, and public security. The second phase of the Jawaharlal Nehru National Urban Renewal Mission (JnNURM), which covers $40 billion in infrastructure-related projects, will play a key role in improving the country’s infrastructure capacity to support urbanization over the next five years.  IBM is currently working on approximately 3,000 smart city projects globally; of those, about 30 pilot projects are from India.  

About a year ago, I published a report on how cities are undergoing rapid transformation and creating massive opportunities for ICT vendors across Asia Pacific. Although the urbanization rate still stands at about 30% in India, it is growing fast. Also, an increasingly Internet-savvy population is demanding better citizen services.  Indian state and city governments will make investments to build infrastructure on a large scale to meet the needs of their surging urban populations, creating opportunities for vendors. —

Despite the promise and opportunities that India provides for Smarter City initiatives, IBM has to deal with key challenges:

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Infosys Wins $126 Million Deal From India Post

 

Infosys recently won a financial services systems integration deal from the Department of Post in the Ministry of Communications and IT of India worth INR 700 crore (US$126 million). In 2010, India’s Cabinet Committee on Economic Affairs approved India Post’s “IT modernization” project, which was divided into eight separate contracts worth a total of $337 million. With this deal, Infosys has won one of these eight contracts.

According to the terms of the contract, Infosys will commission both hardware and software – Intellectual Property (Finacle Core Banking and McCamish Insurance products) over India Post’s approximately 25,000 departmental offices over a period of 24 months. The contract, which is valid for seven years, includes managed services, application support, and infrastructure operations. More details about the deal can be found here.

Let’s look at what this deal means to Infosys and to India Post:

Infosys Gets More Business — But Also Some Risk

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Indian CIOs Are At A Business Technology Crossroads

 

Indian CIOs are at the risk of losing business credibility if they do not improve their understanding of business technology (BT). This is the key finding from the latest report that John Brand and I just published. For this report, we surveyed 130 companies in India, using Forrester’s BT Leadership Maturity Model as a baseline for gauging the BT maturity and readiness of Indian organizations. Our survey revealed a surprising level of consistency and positivity about BT among Indian firms, regardless of organization size, type or industry.

This was especially surprising given that BT is a relatively new concept in emerging markets. When we asked CIOs at Indian organizations to define BT in their own words, the responses displayed an overwhelmingly enthusiastic and optimistic view of BT; the most common theme centered on the value of BT as a general principle. However, many topics that were widely cited in self-assessments from CIOs in more mature markets like North America, Europe, and Australia/New Zealand were all but ignored by Indian CIOs, including time-to-value, market differentiation, communication, and governance.  As Indian CIOs have not long been exposed to the general concepts of BT, Forrester believes that inflated self-rankings are mainly attributed to a lack of understanding of just how comprehensive BT is.

The report helps answer key questions such as:

·         Why are Indian CIOs remarkably consistent in their BT views and attitudes? And is this really just due to a common tendency to inflate their own BT maturity?

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India's Public Sector Forecast: 2012 To 2017

The most critical factor driving the Indian public sector over the next five years will be India’s 12th national five-year plan, which covers the period from 2012 to 2017. I have just published a report on the plan that provides a comprehensive review of India’s new government spending framework and what it means for ICT vendors looking to successfully position for success.

Forrester estimates that India’s public sector IT purchases will grow at a CAGR of 14% between 2012 and 2017, reaching $108.5 billion in 2017. In 2014, we anticipate a decrease in government spending due to parliamentary elections — but spending will pick up after the election, as maintaining GDP growth will be on the agenda of any new government. We believe that massive infrastructure investments and increasing citizen expectations will fuel public sector IT in spite of the 2014 parliamentary elections. Citizens are pressuring federal, state, and local government to become more proactive and interactive and to provide services in a more organized and user-friendly manner. A recent Forrester survey of government IT buyers in India spotlighted this heightened focus on citizen services:

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SingTel Lands Big Government Cloud Win In Singapore

On May 15, 2012, the Infocomm Development Authority (IDA) of Singapore announced that it would award its much-awaited externally hosted g-cloud infrastructure five-year tender to SingTel. My colleague Jennifer Belissent and I published a report on g-cloud opportunities in Asia Pacific late last year that highlighted Singapore as one of the governments leading the way toward g-cloud adoption in the region.

Some key highlights from the Singapore g-cloud contract:

  • SingTel will be responsible for all of the capex- and opex-related costs needed to build and manage the central infrastructure from its own data center in Singapore.
  • Singtel will provide a central “G-Cloud Service Portal” to all government organizations and departments to access central g-cloud services (computing, storage, database, archiving, networking, and other basic resources) and derive revenue based on a subscription model.
  • The Singapore government has not committed to any particular minimum g-cloud usage level.
  • SingTel will provide the required training to government departments on g-cloud functioning.
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Indian CIOs Are At The Crossroads Of Their Future Role; Change Or Fall By The Wayside

I presented the keynote at the Biztech2 event in Mumbai last week. It was a big evening, as almost all key Indian CIOs were present at the event. The theme of my keynote was “The Empowered BT CIO,” which triggered some interesting thoughts, as all of the discussions that I had after the presentation were mainly around “business” with hardly any mention of “technology.” Below are the key points mentioned by CIOs in my discussions with them:

  • “We do all the work and business leaders take all the credit. But if something goes wrong, we are the ones who get the blame.”
  • “The money is with the finance and marketing departments, and we have to depend on them for our budget. My CEO should change this structure.”
  • “I don’t have followers in my organization.”
  • “My organization doesn’t give me the same importance as it gives the CFO or CMO.”
  • “Through technology innovation, I helped the company reduce IT spending and save money.”

All of these points have one thing in common: “my present role and issues that I face today.” But no one talked about their future role! My response to them was consistent, as I categorically highlighted that CIOs have two options:

  • Continue with your current approach — but then the future role of the CIO will be dismal.
  • Step up and take the challenge to shape the business. Take it as an opportunity to transform your role in the empowered world.
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What The India 2012-2013 Budget Means For ICT Vendors

The Indian government announced its 2012-2013 budget on March 16, 2012. While the announced budget does not contain direct incentives to promote the domestic ICT industry, there will be adequate indirect opportunities for vendors to explore. The excise duty will increase from 10% to 12%; this will have a marginal impact on the sale of PCs (desktops, laptops, and tablets), but the government’s focus on improving infrastructure, creating efficient delivery mechanisms, and improving e-governance will provide substantial indirect opportunities to IT vendors.

The latest budget aims to achieve long-term and inclusive growth for the economy and is in sync with my upcoming report, “India’s 12th National Five-Year Plan (2012-2017) Provides Massive ICT Opportunities.” The report answers questions such as why and how technology will act as a key enabler for the Indian government to achieve its growth target.

The 2012-2013 budget will provide adequate ICT opportunities for vendors, such as:

  • Packaged and industry-specific applications, e-governance, mobile apps, and analytics will support the strong need for sustainable revenue sources to fund investments. A common problem that India faces today is the significant imbalance between expenditures and revenues. The budget categorically highlights the need to deliver more with existing resources; we will witness increased demand for packaged and industry-specific applications, e-governance, and mobile apps to help generate sustainable revenue to fund investments. Also, the outlay for e-governance projects will increase by 210%, from the equivalent of US$62 million to US$192 million; applications from software vendors for e-governance initiatives will present some of the most exciting opportunities in India. And the government will use various analytical tools to improve revenue sources and take corrective actions by identifying gaps.
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Amazon Makes Debut In India Through Junglee.Com: What It Means For Buyers, Sellers, And Competitors

In early February 2011, Amazon launched Junglee.Com as a marketplace in India. In 1998, Amazon had acquired Junglee (which means "wild" in English), an online virtual database-making company, and after 13 years now it has shown its affection to the "Junglee" domain name. The reason is that Amazon can’t sell directly in India due to FDI laws that restrict foreign companies on multibrand retail in the country. Nevertheless, the Indian law does allow foreign players to operate as an online marketplace to connect sellers and buyers with each other. Amazon is following this approach by partnering with both online (Snapdeal, Univercell, etc.) and offline (HomeShop18, Bombay Store, etc.) players in the country before it makes a full-fledged entry through an "Amazon.in"-type domain. Also, Amazon just received the Indian Government’s FDI approval to set up a logistics operation. The company plans to invest INR 15 crore (around US$ 3.06 million) to set up a wholly owned subsidiary to undertake the business of online marketplace operator and retailer inter-alia courier services.

Let’s look at what Amazon’s entry through Junglee.com means for online buyers, suppliers, and competitors:

Sellers: More Business And Some Risk

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Mobile Governance Initiative In India: A Step In The Right Direction, But With Caveats

The Department of Information Technology (DIT) of India recently launched a paper on “Framework for Mobile Governance” that aims at providing fast and easy access of public services to citizens through mobile devices. In view of the limited success of the e-governance initiative in India (low Internet and PC penetration coupled with implementation-related issues), the shift in the government’s approach to using mobile as an alternative delivery medium for public services is a step in the right direction. According to the Telecom Regulatory Authority of India (TRAI), there were roughly 894 million wireless subscribers in India as of December 31, 2011, and it is encouraging to see that the government is finally realizing the importance of mobile in achieving its e-governance initiative. I have taken key highlights from the mobile framework published by DIT:

  • Creation of a cloud-based Mobile Services Delivery Gateway (MSDG) based on open standards, which will be shared with all central and state government departments and agencies at nominal cost to facilitate e-governance services delivery on mobile devices.
  • Incorporation of various channels such as voice, text (email and SMS), GPRS, USSD, SIM Toolkit (STK), cell broadcast (CBC), and multimedia (MMS) for mobile-based services.
  • Development of mobile-complaint sites for all government departments and agencies based on open standards.
  • Creation of a government mobile app store which will be integrated with MSDG.
  • Development of an integrated payment gateway for citizens to pay taxes and bills for other public services through mobile.
  • Integration of mobile infrastructure with the Unique Identification Authority of India (UIDAI) platform.
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