V K Mathews | Executive Chairman | The IBS Group

Transformational IT Solutions for Travel, Transportation and Logistics

TiEcon Kerala | Le Méridien, Kochi | December 6, 2014

Start-up to IT Enterprise – The Digital Way

Global IT Industry - Highlights

2

Actual Actual

3.4% CAGR3.4% CAGR

Source : Gartner Worldwide IT Spending Forecast, Oct. ‘14

Indian IT Industry – Highlights

3

11% CAGR

Source: IBEF - IT & ITeS Sector Study, Aug'14

The Digital Future

4

“Digital” has opened up a plethora of opportunities for entrepreneurs across the globe

Mobile Process Automation

Internet of Things

Cloud Advanced Robotics Social Media Analytics

Digital Enterprise

Digital Enterprise leverages digital technology for transforming its internal and external operations to stay ahead of

competition“

”

The Digital Impact

5

Technologies will create disproportionally high value beyond its boundaries

(Estimated at 4-9 times potential value creation)

USD 3.7 trillion*

Cloud

IoT

Mobile

Automation

Robotics

Internet Technology

Global Tech. Revenues 2014

~ USD 16-39 trillionImpact of these emerging fields by 2025

And this will cause the emergence of disruptive non-traditional players

(Digital Bankers – Paypal, Alibaba, Tesco, NTT Docomo, Safaricom, Facebook – as big as a top 20 bank)

Source: McKinsey – Perspective 2025 for NASSCOM, Nov ‘14

The Digital Impact

6

15-25% of existing enterprise IT spend will vanish in the near future

9%9%

91%91%

33%33%

67%67%Traditional IT includes IT Infrastructure , packaged software, BPO, consulting & ADM

Digital IT includes legacy-digital integration, SMAC & cyber security

Source: McKinsey – Perspective 2025 for NASSCOM, Nov ‘14

The Digital Impact on Industries

Digital within(Targeted Solutions)

7

End-to-end digitization(Moderate Impact)

Digital or Death

(High Impact)

Retail banking

Health care

Oil and Gas

Auto

Media

Retail

Digital has now shifted from a hygiene factor to a survival means in many industries

‘Digital or Death’

Digital disruptions to affect industries differently to ‘Digital or Death’

LOW HIGH

Digital impact on industry

Source: McKinsey – Perspective 2025 for NASSCOM, Nov ‘14

The Digital Impact on Enterprises

• Digital Products – Improved asset utilization• “Mobility as a service” replaces the car (e.g. Uber)

• Platforms to transform products to services

• Digital Channels – Massive disintermediation• 50% bank branches shut

• 75% reduction in dealer visits

• Digitized Processes - E2E Digitization & Automation• Reduced staff costs

• Increased efficiency across manufacturing value chain

• Data driven Decisions• New use cases – ATM network optimization

• Artificial intelligence models

8

Impact to be felt across 4 dimensions at the enterprise level

Source: McKinsey – Perspective 2025 for NASSCOM, Nov ‘14

Financial Services•120 million rural households

without bank accounts•48% leakage in employment

guarantee program payments

The India Opportunity

9

Massive unmet demand for basic goods and services in most sectors

Digital + Last Mile connectivity can help bridge these gaps!

Health Care•1/3rd doctors per capita compared

with China & Brazil •43% absentee rate of health

workers

Education•88% of class 8 students in rural

India unable to read a class 1 text•500 million without secondary

education or skills training

“ ”Source: McKinsey – Perspective 2025 for NASSCOM, Nov ‘14

The India Opportunity

10

Widespread adoption of technology will herald the Digital Era

2014 20252014 2025

Internet Connectivity

Cloud

Automation

Digital Payments

Digital Identity

Internet of Things

100-130 million mobile internet

users

700-900 million users

~2 million SMEs on cloud

~20 million (50% of all SMEs)

60 million smartphone users

(intelligent app users)

700-900 million smartphone

users

1.5 billion electronic

transactions p.a.

12 billion e-transactions p.a.

~50% of population under

Aadhaar

~100% of population under Aadhaar

Connected devices - NA

3-10 billion connected

devicesOpportunities galore!

Source: McKinsey – Perspective 2025 for NASSCOM, Nov ‘14

Building an Enterprise

11

• Focus on domain expertise over entrepreneurial zeal

• Building internal capabilities – people, process, leadership, governance

• Ensuring your value proposition stays relevant

• Developing brand equity and sales capability

• Investing in capacity over solving internal problems

Very different from launching a start-up

Thank You

© IBS Software Services 2014