Indian IT desperately needed a new business model and coronavirus gave it one

With the onslaught against H-1B visas and outsourcing, Indian IT services companies were going to be swimming in perilous waters if they didn't find a new way out.
Written by Rajiv Rao, Contributing Writer

Adversity breeds opportunity, so they say, and some of India's IT stalwarts have certainly taken that expression to heart at a time when the coronavirus pandemic has caused lockdowns and devastation around the world.

India's largest IT services provider, Tata Consultancy Services (TCS), is one such stalwart. It apparently only had a window of six, short hours to pretty much move all of its core operations -- lock, stock, and barrel -- from its state-of-the-art, secure environments within offices to the living rooms and bedrooms of its employees. 

"From a highly centralised model consisting of workspaces set in large delivery campus capable of accommodating thousands of employees, we had to switch to an extreme form of distributed delivery in a matter of days, which is not a trivial challenge,"  TCS CEO Rajesh Gopinathan said in a report

Since the transition, TCS has been grabbing headlines for having successfully moved 85% of its staff to a secure, work-from-home model. There are two notable feats regarding TCS's move. One, Indian companies are notoriously hierarchical with an inability for upper management to relinquish control; so going from an in-office work style to a remote one is almost too hard to imagine. 

For instance, some IT companies have implemented "employee productivity trackers like webcam-based movement capture, hourly timesheet entry, tracking of keyboards, and so on, to ensure employees are working at home," Yugal Joshi, vice-president at Texas-based consultancy Everest Group, told Quartz

"This indicates a deep-rooted malaise in Indian IT/ITes industry where the senior management generally mistrusts people," he added.

Two, unlike the retail or manufacturing sectors that cannot operate with current social distancing norms, the top-tier Indian IT companies and their mid-sized brethren are responsible for keeping the lights on for a large collection global companies -- some of whom are depended on people every second of the day. This includes banks, utility companies, retailers, and, of course, pharmaceuticals.

With the ongoing coronavirus outbreak, all of these industries are now being serviced from the apartments and houses of India's IT workforce, which as you can imagine, is a supremely difficult and exasperating task for everyone involved. Most of IT's clients have ironclad regulatory and privacy riders that have needed to be tweaked considerably in light of coronavirus. 

See also: Edtech thrives during coronavirus-hit exam season in India

Then there's the bandwidth issue. As is, the connection available in residences are often spotty and can hardly compete with the blazing fast ones within IT offices. Now that practically every tech employee in Bangalore, Delhi, and Bombay are clogging up fibre, the ability to deliver solutions while virtually conferring with large teams has become a herculean task, if it wasn't already prior to the outbreak.

Given these hurdles, how did TCS implement such a staggering transformation, and in such a quick and effective manner? TCS CTO Ananth Krishnan disclosed to ZDNet that its transformation stemmed from its Enterprise Agile program that had nothing to do with the pandemic and was actually kicked off three years ago. 

"This has driven systemic change in our mindset so we can deliver location-independent services. It has nothing to do with COVID-19 but it has come in pretty handy," Krishnan said. 

He added that the application of the program's principles has become a fundamental part of every team's culture within TCS. Another factor, which Krishnan described as a "machine first culture", has been TCS's ability to bring artificial intelligence and automation into a large portion of its mission-critical functions like infrastructure, networks, cognitive apps, among others. In other words, when COVID-19 came knocking, TCS's transformation was much easier due to preparations they had made earlier.

For instance, take this case of how TCS handled a banking client. Regulators and central banks all over the world are starting to allow the deferment of loans. For one such client, TCS had to implement an immediate system change to one of the client's basic platforms in order to immediately allow monthly instalment deferrals. In addition, the platform needed to be rolled out at lightning speed; monitoring systems that could send alerts once the crisis abated needed to be implemented, and a capability to stop deferments post-COVID-19 was also required. TCS was able to achieve this despite moving its workforce to outside of the office. 

TCS attributed its success to its new secure borderless workplace, called model 25/25, which means that it thinks that only 25% of its workforce need be based at its headquarters for 100% productivity to be achieved, and that 25% of a TCS project team do not need to be in the office for any particular project to move forward.  

Change is definitely here to stay for companies like TCS and Wipro, who have decided to embrace the current state of affairs as a springboard for the future. 

"It's about time. Our current operating model is currently a 20-year legacy model," said Gopinathan in an interview with BloombergQuint

In some ways, this may prove to be a godsend for Indian IT. Especially so, in light of US President Trump's onslaught against H-1B visa-seeking IT companies who have been forced to wean off their off-shore outsourcing armies in recent years. Indian IT's model had to change and the coronavirus pandemic may just have influenced that to happen at warp speed.

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