The sentiment in services sector is quite bullish. Industry is
abuzz with an anticipated increase in IT spending in the coming
year.
According to a KPMG survey released in May 2009, about 43
percent of services companies participating in the survey planned
to increase capital expenditure. Only 7 percent said that they
would prune the expenditure. About 37 percent predicted that new
orders will grow in the next 12 months, while 16 percent
anticipated a fall. The survey also indicated that Indian services
companies are planning to expand their revenues in the coming
months, with 32.5 percent expecting a rise in profits.
| Figure 1: Outlook for service organizations’ IT
budget in 2010 as compared to 2009 |
 |
In the current senario, businesses in services sector are vying for
the same set of customers—especially with the competition
getting severe as recession is loosening its grip. To stay ahead,
these organizations have to look for ways to increase efficiencies
in the business, reduce operational costs, retain customers and
mitigate risks.
The recently conducted Infrastructure Agenda 2010 survey clearly
indicates that cost-saving technologies and platforms such as SaaS
and open source will help services companies achieve these goals.
Half of the respondents in this sector are also interested in
managing IT infrastructure more efficiently. Hence, it seems
virtualization and server consolidation will be key focus areas in
2010.
Top Trends
| Figure 2: Areas of increased spending in 2010 for
services |
 |
To retain existing customers and win new ones, it is important to
analyze captured data and understand customer trends. It is not
surprising then that more than 90 percent of the respondents said
they will increase investment in BI solutions. Additionally,
it’s crucial to mitigate risks that can impact the top line
negatively. More than 90 percent of the survey particiapants said
they will increase spending on security solutions in 2010. About
88.9 percent of services companies that participated in the
Infrastructure Agenda survey are planning to increase investment in
cost saving technologies.
Figure 3: Areas in which organizations in this
sector
use open source |
 |
In the next year, services companiesare planning to increase
spending in virtualization and server consolidation (81.8 percent),
SaaS/cloud computing (72.7 percent) and video conferencing and
unified communications (54.5 percent). Virtualization and server
consolidation help companies make optimal use of their existing IT
infrastructure and thus avoid or minimize recurring investments
induced by growth. While the pay-as-you-use model offered by SaaS
helps keep costs within control. Video conferencing and unified
communications can serve as substitutes for executive travel.
Organizations in this sector are showing a keen interest in open
source solutionsin almost all areas except storage (0 percent).
Cost savings are the obvious benefit here. Globally, enterprises
are increasingly adopting open source solutions and the
multinational services companies are taking to open source for
compliance reasons. The subscription model offered by open source
makes for more predictable cash flows as organizations move from
CAPEX to OPEX models. The biggest areas of usage are development
tools (63.6 percent), operating systems (36.4 percent) and
databases (36.4 percent).
|
Dhiren
Savla
CIO, Kuoni Travel
Group
Key challenges in 2010:
The big challenge for Kuoni Travel Group in 2010 is building
business efficiency and reducing costs. I have to keep an eye on
governance risk and compliance. I am expected to innovate and
support growth in newer businesses and markets.
Key 2010 initiatives:
- Working on a variable model. SaaS is one key initiative planned
in 2010. IT will be used to bring down the cost and the resulting
savings will be utilized to make more money
- Implementation of structured and automated GRC tool to handle
our global footprint. This will ensure monitoring and measurement
of technical and operational controls
- Second phase of multi-geography DR project, a governance model,
scalable and highly-available infrastructure, a flexible IT
landscape, and global reach to ensure that the IT function will
help in achieving business goals.
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Sunil
Mehta
Senior VP & Area Systems Director
(Central Asia), JWT
Key challenges in 2010:
Being a services company, we depend a great deal on our clients'
advertising and communications spending. In the current senario, it
is obviously a great challenge as companies base their spending on
the economy. This has a cascading effect on the entire media
industry. If the company makes good use of clients' advertising
budgets, IT too has the flexibility to do more with better budgets
and scale. This will ultimately add value to the clients and to the
company at large.
Key 2010 initiatives
include:
- Virtualization and consolidation of servers and
applications
- Better DR and BCP plans
- Security enhancement and policies
compliance
- Green IT across the company and
awareness
- Skills enhancement for the IT team
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S Francis
Rajan
Head ICT, Bangalore International
Airport
Key
2010 initiatives include:
- Process mapping and documentation to complete the ISO 27000
accreditation exercise
- Retain ICT talent to carry forward ICT services to all stake
holders; maintain the current high standards for ICT services (99.9
percent uptime)
- Innovate process efficiencies solutions to cover all
operational effectiveness
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