Ever since the Indian economy was liberalised in the 1990’s, the Indian IT industry has grown by leaps and bounds. And a major contributor to this growth has been the IT enabled services (ITES) industry. Speaking broadly, IT enabled services are services which use Information Technology as a resource to help improve and implement various business processes.
As an example, data entry is not an IT enabled service, but if the data entered is used to collate and analyse information using the various IT tools available, it becomes an IT enabled service. Speaking of the IT industry as a whole, the ITES sector contributes as much as 27% of the total IT revenue in the international market and 10% in the domestic market.
Talking of ITES, the services can be broadly broken down into the following:
1. Transcription services- This involves breaking down of recorded information, segregating the important information and collating it to give businesses useful and thorough data to refer to. India is a hotbed for outsourcing transcription services, especially medical transcription, legal transcription and business transcription. The US accounts for a major portion of outsourcing transcription services to India. The medical transcription alone in the US is estimated to be worth USD 25 billion.
2. Document Processing- Managing documents for archiving purposes or for distribution, providing end-to-end solution for methodical storage and retrieval of documents, converting documents into electronic form and distributing the same etc., all this comes
under the document processing services.
3. Data Entry and Processing- This is perhaps the starting point of the Indian ITES industry. It involves feeding data into the system, collating and analyzing it to provide useful and actionable information to businesses.
4. Data Warehousing- Data warehousing is gathering of data from various sources and then collating into one unified source of data which is updated from time to time. This data is then used by businesses for understanding trends and charting out long term growth strategies of the
company.
5. IT Helpdesk Services- IT Helpdesk is the first point of contact for the end consumer. It is through the helpdesk that the user informs the company about his grievances, suggestions and the general feedback. Thus, IT Helpdesk forms a very important part of IT services. However, most of the times, organisations find maintaining a Helpdesk a very costly affair. And that’s where outsourcing comes in. IT Helpdesk Services involve serving customer queries through phone as well as e-mail 24/7.
6. Application Development- Most of the Indian companies in the ITES domain offer application development as one of their services. This service involves developing custom applications for businesses to improve their processes as well as integrating new applications with the already existing system.
7. Enterprise Resource Planning- This is perhaps the newest entrant in the Indian ITES segment. Enterprise Resource Planning or ERP involves automating the flow of information within and outside an organisation to streamline various businesses processes viz. accounts, sales, HR etc.
8. Telecommunication Services- Telecom services are another type of IT enabled services provided by the Indian companies. Patni Computers is one of the top players in this domain. Telecom services involve consultation, integration and adoption of the latest in technology to help improve the efficiency of a telecom organisation.
The latest kid on the lock when it comes to ITES is cloud computing. The need for better cost efficiency and faster set of services is contributing to the growth of cloud computing. The pay-as-you-use model of cloud computing, in contrast to the conventional IT model is attracting companies the world over.Cloud computing services can further be broken down into:
1. Infrastructure as a service (IaaS)
2. Platform as a services (PaaS)
3. Software as a service (SaaS)
According to a recent survey by Confederation of Indian industries (CII), 79% of the companies in the ITES sector feel that including SaaS as one of the services in their service package would help give them the edge and make them more competitive. Furthermore, the biggest reason for Indian companies to include SaaS in their service package is to increase the customer base. The ease of product maintenance as a reason comes a close second. The survey also states that the bigger players in the market are more enthusiastic about SaaS than the SMEs. SMEs view it primarily as an opportunity to increase the basket of their services.
The scope for SMEs in ITES
Going by the survey of CII, the traditional markets of US and UK are going to be less lucrative for the bigger players. However, there may be a lot of growth at the base of the pyramids which could prove to be an engine of growth for SMEs in the US and the UK market. According to CII, almost 71% of the SMEs still see the US and the UK market as an expansion opportunity while the bigger players have shifted focus to the eastern European countries.The CII predicts that the Middle Eastern countries, Asia-Pacific and the European market are going to be the next big reasons for fuelling growth of the ITES sector in India. It also advises the SMEs to focus on relatively untapped markets like the Middle
Eastern countries as well as the domestic market to derive the maximum possible benefit. It especially focuses on the domestic market as a major contributor to growth because of the government’s push for transparency in business processes.
In short, SMEs in the ITES segment have a lot to look forward to and have plenty of growth opportunities to explore, if only they tap the right areas.
Contributed by “The Writing Lab” our content management partners
SME JoinUp Blog (2012) 
