Tuesday, March 31, 2015

Are we ready for the coming IT Storm!!

Beware the Coming Storm!!

The pace of change only increases and we do not cease to be amazed by new and relevant business models.

The pace of Innovation itself is accelerating, what with higher connectivity, collaboration platforms and enablers of the likes of Maker Movement (and its variants), KickStarter, MakerBot and others yet to be discovered, absolutely fantastic innovation accelerators.

Concept to Product is now days, for complex products weeks, and not months!

So what is the Storm for IT Companies, specifically Indian IT Companies still stuck in the last century 'Lower Cost' syndrome?

Lets face it, most revenues still flow in because India has not economically grown to a size and scale; and because we continue to get cheaper Engineers mass produced from our Education Factories, which so remind me of the Pink Floyd video 'another brick in the wall'.

The Storm is, as stated above, Innovation and New Business Models for delivering IT Services.

What do I see as the Big Shifts due to the Storm, what gets blown away?

  • IT workers with commodity skills will be replaced, in thousands, by 'Algorithms'.
  • Crowdsourcing will enable the best and most efficient 'Independent Contractors' to provide services at costs far lower than high overhead IT biggies, far more nimble, equal or higher quality. 
  • Smaller, Niche Service Providers will nibble away, and then rapidly eat part of the lunch, at least for niche areas, the likes of Analytics, or Data Sciences.

The first of these is very real, very very real and nearer than we care to think or acknowledge! Industry has nearly a million commodity IT 'knowledge' workers who have not cross skilled into relevant and current technologies. Most are complacent, comfortable in their cocoons, getting year on year 6% raise, job hop a few years and stay ahead of inflation, become a 'team leader', perhaps a Project Manager some day.. will we have a million PM and Project Directors?  of course not!

Entry level salaries of engineering hires has not increased dramatically in last decade. so either one gets replaced with 'Cheaper' fresher engineer, or by an algorithm. either which way, one will get replaced if one did not upgrade and stayed relevant!

In my view, the probability of being replaced by an 'Algorithm' is higher than being replaced by another cheaper 'IT engineer'; for one algorithms are getting far more efficient, secondly they don't ask for a raise every year and then do mass sulking, searching for alternatives; thirdly they do not take tea breaks, cricket match breaks and similar such distraction; and most importantly, they are scalable up and down without the associated emotional drain that every manager goes through.

Now, I am not being fatalistic and predicting that all IT engineers would one fine day land up at their office to see an 'algorithm' or a robot sitting in their place, but lets face it, many will start to see this.
It will not be long before the exponential portion of the 'S Curve' of Systems Theory hits the large majority.

The big question is, what is the time-frame for that to happen, 2 years, 4 years? 

One answer is that it is inversely proportional to the pace of Innovation that we see, so not too difficult to see it coming head on!

All for this post.