India is at the core of International Business Machines Corp.'s growth strategy, both in terms of clients and talent. IBM in India has been investing in building development centres that will help contribute to the innovation and growth of its software portfolio. Its consulting business in India is also witnessing doubledigit growth. In an interview, Sandip Patel, managing director of IBM India, talks about the company’s growth strategy in India, the technologies it is focusing on, and the implications of spinning off its managed infrastructure services business. Edited excerpts:
What is IBM’s roadmap for India in 2022?
IBM today is a significantly different company: we are more strategically focused, more technologically capable, and more financially sound. We are bringing the power of hybrid cloud and AI (artificial intelligence) technologies to clients around the world. India is at the core of IBM’s growth strategy, be it for our clients or for talent.
About 70% of our revenue will now come from software and consulting, higher value businesses that both saw strong growth in Q3 with consulting’s continued acceleration and two-thirds of our software business on a recurring revenue basis. This is true for the India business as well.
We also are leaning more heavily into our ecosystem and have collaboration with all the top GSIs (global system integrators) in the country. While we invest in partnerships, we also invest organically and inorganically to deliver innovation. We have made 19 acquisitions since April 2020 to strengthen our hybrid cloud consulting capabilities. In the same manner, we are organically developing new innovations that matter to our clients.
In 2022, we will continue accelerating our business growth in India with expansion and hiring in cities beyond metros, building on our collaboration with leading educational institutes, investing in building the skilling agenda for our employees and contributing to country’s Skill India and Digital India mission.
Tell us about your plans of setting up more centres in tier-2, tier-3 cities in India.
We have been investing this year in India, in building development centres that will help contribute to the innovation and growth of our software portfolio. We recently announced the launch of IBM India Software Labs in Kochi and Ahmedabad. Similarly, as part of IBM Consulting business, IBM Client Innovation Centre (CIC) specializing in design, software engineering and analytics was launched in Mysuru, and we are looking to hire over 10,000 staff this quarter globally. Recently, we also launched a new facility in Hyderabad dedicated to business process operations consulting.
The expansion in these cities will boost the building of skills and digital innovation — providing a strong foundation for the IT/ITeS sector in the respective states. This will also help extending opportunities to talented people beyond the metros in India for the benefit of our clients.
We are witnessing a double-digit growth for our IBM Consulting business in India and continue to hire. To drive growth, IBM Consulting has expanded hiring in double-digits across its global delivery network, including 55,000 fully cloud-trained consultants globally, and over 70% of professionals have deep industry expertise. This is true for India market as well.
What are the top technologies IBM will be focusing on in 2022?
We will continue to invest in technologies that are helping our customers drive business value and growth. Some of them include open hybrid cloud, data and AI, cybersecurity, blockchain, and quantum computing. Quantum computing is nearing a phase of commercialization that will change our world. From the field of drug discovery to complex financial modelling – the potential applications of this technology are huge in a country like India.
Our commitment is to grow a quantum ready workforce and build an ecosystem to nurture the quantum community in India. We are allowing over-the-cloud access to our quantum systems for top-tier institutions like the IITs, IISc, Indian Statistical Institute (ISI), Indian Institute of Science Education & Research (IISER), etc., of India to accelerate advanced training and research in quantum computing.
What are the tailwinds from spinning off IBM’s managed infra services business?
IBM and Kyndryl are each other’s biggest client and one of each other’s key strategic partners. Kyndryl will continue to include IBM hardware and software among its offerings. We are confident that the joint business of IBM and Kyndryl will continue to grow in India as the client benefits from the added degree of focus that each company will bring.
We are committed to redoubling our efforts toward customer responsiveness and attentiveness and those enhancements are already being carried forward by both IBM and Kyndryl. For example, our work with Bangalore International Airport Ltd (BIAL), is part of a ten-year partnership under which IBM and Kyndryl will provide best-of-breed IT solutions to create a new “Airport in a Box” platform that will support transforming the end-to-end travel experience for passengers at BLR Airport.