Vinod Nair, Managing Director of Softline India is a business leader with a perfect blend of experience & skills in running start ups at growth stage. He talks on digital transformation, customer type and segments, market potential and challenges of the same.
Q.1 What are the trends in customer acceptance for digital transformation in India?
You can classify customers into two parts, one, who are probably addressing the growth pangs where they have a lot of growth visible, but they need the technology to help them, ride that growth wave pretty well. And the second segment of customers are probably customers who are in that industry at the wrong time from a perspective and there is a lot of consolidation happening that is a lot of cost pressures in that industry because of the pure dynamics of that industry.
Q.2 What are the business requirements which are making it essential for the businesses to go for digital transformation?
Specifically from an India perspective, is that the CIO community over here is very mature. They don’t have a set template to really go after and start delivering,digital transformation projects. So, we’ve seen a few things, one is that they don’t go for something that is just globally deployed and use that template and deployed here. They’re really looking at solutions where it is pertinent from an Indian market perspective, the cost pressure associated with it to be considered as one of the aspects of deploying a digital transformation solution.
Q.3 What percentage of customers is opting for digital transformation are opting for?
70 -75 percent of our customers are really putting in their thoughts and budgets on digital transformation projects.
Q.4 What are the customer type and segments which are the largest adopter of digital transformation in India?
If I want to look at purely from a vertical perspective, I think manufacturing and FSI has been really early adopters from digital transformation perspective. The flavours might change, but both of them have been. For example, manufacturing has a lot to talk about on the shop floor. For them, digital transformation on the shop floor makes more sense and is more close to their heart as compared to the FSI industry where it is more about customer acquisition, retention. These are the two verticals that we’ve seen. I think the next best bet and within manufacturing, I still consider pharma to be part of manufacturing because they’ve also been an early adopters. But if you were to look after all of these segments, then probably retail comes the next where there has been significant uptake on digital transformation.
Q.5 What is the adoption among the SMB customers?
We look at SMB in two parts. One is those organizations who were actually born from a disruption of an industry perspective. In those organizations, I think it is digital transformation itself that has cost that particular assembly to form the way they are.
For example, not too many years back, Flipkart was also an SMB or an OLA was in SMB. It’s just that the disruption in that particular market happened, that was fuelled by digital transformation that they’ve got up doing it. But if you look at the other segment of the SMB, which has not happened because of any digital disruption or cloud or the model disruption as such, those organizations have been a little bit slow on adopting of digital transformation projects. I think they have rather gone for right now, data center transformation products.
Q.6 What is the market potential of digital transformation in India?
There are a few things that in India will make a lot of difference from company’s growth perspective as well as the ability of retaining customers.
Q.7 What are the growth factors?
One of them being AI : artificial intelligence using data. The second segment where you could see a lot of work being done is on the data center transformation site. So, organizations who are rethinking off their business models would probably look at the second aspect where data center transformation projects are being taken up by the ones who are really today on a acquisition mode would look at the data& AI.
Q.8 Why do digital transformation projects fail?
If you look at the failure, it’s largely because of, inadequate business case associated with a project. Smaller section of failures that but to do it, probably choosing the right partner, with whom you’re going to embark on this particular journey.
Many times what happens is you envisage a digital transformation project, but you don’t envisage the underlying technology associated with it or the partner associated with it.
Q.9 What are the challenges you see in the digital transformation scenario in India?
A business case, that’s one challenge that is there. Budgets continue to remain and predictable budgets continue to remain as the second challenge, because as the whole cloud world goes about, you don’t have a concept of a project budget. You actually have a concept of a per transaction budget order, but, for instance budget.
So, those are the two ways how you will look at it. And unless and until you control both, you know, you have another challenge that is staring back at you.