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Ravishankar G CEO, Geometric

Impact: Today we face a very challenging business environment, which has become significantly tougher in the last six months. Our business is largely exposed to the manufacturing industry, especially the automotive sector, which has been impacted by this slowdown. Weve seen a definite slowdown in order book closures over the past year. This is a ramification of the fact that there has been a delay in customers budgeting cycles, resulting in the overall business decision cycles becoming significantly lengthier.

Over the last couple of quarters we had expected this impact on our business. Therefore, recognizing that the business environment was going to be challenged, we focused all of our energies on ensuring that we retained our business volumes in our existing customer base. This is reflected in the fact that our key customers have stayed with us, have continued to work with us, and our native business has suffered minimal impact on overall volume. We have been able to expand our pipeline through leverage of existing relationships and positioning our significantly strengthened offerings.

Challenges: As mentioned earlier there has been a delay in budgeting decisions of our customers. This is expected to result in delayed business decision cycles. Our strategy and outlook for the coming quarters will largely be based on these budgetary decisions. Having said that, as a company, we believe in the short term our greatest opportunity lies with our existing customer base. To reiterate, our emphasis in these tough times has been and will continue to be to deliver value to our existing customers, and build on these relationships. We expect a lower growth in the generation of new business. We have built a very strong set of business offerings, and we continue to position these aggressively in the market.

Further, as a part of improving our operational efficiencies, we are looking at driving higher offshore leverage of our global businesses.

Changes in market dynamics after recovery: As the market starts to improve, we expect global companies to look at global low-cost destinations and outsourcing to drive better capital and operational efficiencies.

Moreover, manufacturers will want to leverage IT to improve their cost and time-to-market in order to capture the market before their competitors. This is expected to open up significant potential for companies like us in the product realization space.

Lastly, although there has been a slowdown in the product decisions at our customers end, they are expected to continue their efforts toward new product development in order to stay on top of the market. An increased thrust on global engineering to drive cost efficiencies and cater to the needs of emerging markets is also expected. Therefore, we see this sector picking up fast as the markets start to turnaround.

Akash Deep Sharma COO, eSys Information Technologies

Impact: Because of the slowdown people are delaying their decisions. Customers have become more conscious. However, there are verticals like education and government that are still contributing to the overall growth of the industry. The biggest impact of the economic slowdown is that people have become very conscious and are not investing on their IT infrastructure. They have adopted a wait and watch approach. So this delay in taking a decision is one of the biggest impacts on the industry.

Challenges: We as a company have been doing fairly okay and the slowdown has affected us only marginally. However, the industry in general will have certain challenges. One of the biggest challenges that the IT channel community will have in the next two or three quarters will be sustainability. This will be a major issue for relatively smaller players. So, to sustain them, it is advised that they should also be focusing on improving their services to end customers. In addition, employee retention will also be an issue with smaller players.

Changes in market dynamics after recovery: After the economic recovery there will be more conservative outlook in terms of credit line extensions to small resellers and we also expect an increase in distributors margins to makeing their businesses more viable and robust to withstand such shocks in the future.

Kapil Dev Singh Country Manager, IDC

Impact: The three fundamental impacts are: spending cut by users, cost structure inertia putting pressure on margins, and payments not coming on time fueling a liquidity crunch. The three are feeding into each other. Behavioral manifestation of all this is a heightened anxiety at all levels leading to low morale. People feel less secure today.

Challenges: How quickly businesses can move on to new cost structures/models, which are in line with the changing paradigm of revenue growth.

How to be more aligned with the new realities emerging, driving growth through many smaller/niche opportunities, equal focus on how to milk the existing and simultaneously create new revenue streams.

How to keep employees motivated and keep them with the organization during the transformation.

Changes in market dynamics after recovery: I feel that there will be greater emphasis on IT infrastructure leverage in order to provide new and innovative services to the users (both enterprises and consumers). IT vendors/suppliers/leaders will have to think business wise rather than just be concerned with technology. Internet is going to play a significant role in the new paradigm, in terms of creation and delivery of services. The IT engagement will also shift its focus from capex driven investment to opex driven investments

Partha Iyengar VP, distinguished analyst, head of research, India, Gartner

Impact: A significant rub-off effect in the rest of the Indian economy, as the IT industry has been the key driver of growth in many other industries as well (real estate, retail, leisure, etc) directly or indirectly. Every dollar of spend in the IT industry anecdotally contributes about $4 of spend in the overall Indian industry.

Another is the reversal of the view that IT careers are the preferred careers in India. Similar to what we saw in the dot-com bust days, there is an increasing movement away from IT careers in the light of the slowdown.

Challenges: To maintain employee friendly policies and behavior as far as possible. Companies that dont will have a tough time recruiting the best talent when the turnaround comesemployees increasingly have a long memory on companies that treat them professionally and those that dont.

Revamping sales and marketing messaging to aggressively leverage the increased opportunity in this slowdown, as opposed to viewing it as a major threat.

To reaffirm the commitment to the domestic Indian industry needs, without positioning or having Indian clients feel like this is a stopgap focus till the global market turns around. There has to be strong long-term commitment to the Indian market.

Changes in market dynamics after recovery: Those companies that view this downturn as a strong opportunity and revamp and refocus their sales efforts accordingly will have disproportionate growth when the broad-based recovery happens, as compared to competitors (local and global) that dont. There could be a fundamental restructuring of the competitive landscape in the offshore services (and domestic services) industry after the recovery, based on this issue.

Sharad Sharma CEO,Yahoo! India Research & Development

Impact: We will witness accelerated activity in the following areas:

Shift to online advertising

Shift to open source

Shift to growing emerging markets

Challenges: The top three challenges would be increase in both product and business model innovation and staying disciplined about costs.

Kishor Patil CEO, KPIT Cummins

Impact: The slowdown has forced companies to shift their priorities and focus from long-term to short-term return on investments. Companies are facing pressures of declining topline revenues and are thus aiming at reduce costs in order to maintain profitability.

The top three impacts that we see as a result of this changing paradigm are:

Lower visibility (visibility is very short term); customers are facing challenges of uncertainty pertaining to their business outlook. Therefore they are focusing only on strategic IT and R&D areas, and discretionary IT spends have declined.

Growth seems to be soft due to the impact on global manufacturing industry and hence the priority has moved to aligning cost structures to revised volumes and making it variable.

Our focus is to take only those offerings to customers which are either strategic or have higher RoI.

Challenges: The top priority for us as an organization is to create and offer our customers strategic and differentiated selling propositions that strike a balance between innovation, cost reduction and higher productivity.

Growth will be very soft, therefore we have to identify strategic priorities of customers and align our solutions and services to these growth opportunities.

We have to manage costs in very uncertain situations and need to be prepared in case there is further weakening of the economy. Apart from the profitability we have to manage human resources, facilities, etc. Planning in a way becomes important so that it is optimal to the volume of business.

In this current environment we would like to improve cash flows and create cash reserves. The focus is to continue to reduce working capital cycles

Changes in market dynamics after recovery: In our focus verticals we foresee significant changes in product design and development, service delivery and customer buying patterns. The auto industry would be governed by regulations for fuel efficiency, reduced emissions and safety. Semiconductor manufacturing would be about feature rich and low-power design and industrial equipments would be loaded with more electronics.

Certainly, I think the priorities for customers and hence for us have changed with respect to the solutions and services we take to them and the business model we offer. Though it will take some time to make the transition I believe it would be a good opportunity to partner closely with customers.

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