Infosys unveils three-year strategy to develop digital services

25 April 2018

In light of diminishing profits and increasing competition, Indian tech firm Infosys has decided to revise its strategy in India to focus more on digital services. “The idea is - this is a huge market, how can we be more relevant for our clients’ future through this market,” said Salil Parekh, CEO of Infosys in India.

What happens when a market transitions from 400 million online users to 850 million in half a decade? Such is the scenario presently unfolding in India. Expanding online access has several repercussions, some more direct than others. From a consumer perspective, one of the first industries to grow in such a scenario is the digital media segment, fueled by the jump in online consumption.

From the perspective of a firm offering products or services, on the other hand, a digitally connected population offers a world of possibilities to optimise the online consumer experience. In order to complete this transition to the digital sphere, most firms require external help, usually from tech consulting firms.

Add to this the global trends of internal process optimisation through the application of the latest in cloud computing, automation and AI, and one can see why the Indian software services industry is worth $154 billion. Infosys is the second largest actor in this industry, although the firm’s strategy is in need of significant adjustments. Infosys unveils three-year strategy to develop digital servicesAccording to Infosys CEO Sail Parekh, who has only been at the helm of the firm since the start of this year, the entire organisation now needs to revolve around its digital services segment. Parekh cites a number of factors for this revision.

A boom in the international clientele is perhaps the biggest reason. A substantial digital market attracts foreign investment, and IT services firms such as Infosys offer crucial support at the entry stage, helping with market integration and fending off local and other international competition.

The need to focus on digital services is further driven by the fact that revenues and profit margins from the firm’s traditional offering are faltering. The firm has traditionally operated as a provider of maintenance services for clients’ IT infrastructure; however, the value of these services is declining, resulting in the demand for more work at lower fee rates.

As such, Infosys will look to further develop its digital services, specifically over the next three years. As elucidated by Parekh, “The first year in fiscal 2019 to stabilise where we are, the second year to start to build momentum and (the) third year to start to accelerate where we can have more and more share of our clients’ relevance and that will obviously translate, overall, to a better Infosys.”


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Avalon Consulting reveals its four step strategy for sales acceleration

12 April 2019

Sustained growth in sales is often equated with profits and cash flow as a metric to determine the health of a business, and a combination of progressive demand and knowledge of the consumer base is crucial to maintaining sales growth, according to Mumbai-based management consultancy Avalon Consulting.

In some cases, according to a new report from Avalon, growth in sales might even be a priority for firms over profit, given that the former is challenging to achieve and requires constant vigilance. A number of firms have seen their promising business models made irrelevant overnight due to sudden market developments.

Unforeseen market changes – such as the current wave of digitalisation – are the biggest threat to sales growth, which has been exemplified by a number of major companies in the past. Avalon cites Kodak’s relative obscurity in the current photography economy as one prominent example, and Nokia’s position in the smartphone market as another.

So the formula to maintain growth in sales in a complex one, and Avalon conducted analysis of some of the biggest growers over the last two decades to try and devise a comprehensive strategy for sales growth. Of the firms analysed by Avalon, only 35% could maintain their high levels of sales growth between 1997 and 2017.

Avalon's approach to sales acceleration

Combining this data with Avalon’s own experience with clients, the firm has devised four key characteristics of firms that have cracked the code for sales growth, based on which it has developed a Sales Acceleration Framework (SAF). Firstly, the business model is one that continues to generate new demand over time. 

Successful firms ensure that they familiarise themselves with the nuanced needs amongst their customer base, and constantly disrupt their current operational structures to evolve with market trends and developments. To lubricate this disruption process, firms have an established mechanism to facilitate major operational change.

The first step in Avalon’s SAF framework – which is based on these principles – is to arrange discussions with a firm’s senior leadership to hone in on certain key problem areas that need to be addressed on a priority basis. Once this is done, the second step is to develop strategies to address these key issues.

These could include surveys with people involved in the problem areas. The third step is to then develop action areas, a task that Avalon has developed adept capabilities in via its own proprietary model. The last step to accelerating growth is the recommendations of quick wins or low hanging fruit that may be addressed immediately.