Immigration issues are real for India IT: Zensar CEO
News | 25 Feb 2019
IT services sector's time-tested model of deploying Indian talent for projects onshore is no more relevant as immigration issues are real in the US, said Sandeep Kishore, CEO and MD, Zensar Technologies.
The IT services industry executive believes the model of building a business by sending technology talent from India is “dead” and despite India's disproportionate advantage in terms of talent among other English speaking countries, IT services companies need to have hybrid model Indian and US experts to work complex problems.
“Immigration situation is a real situation (in the US). You really cannot build a business by shipping people. That is a dead model. You got to create local capacity,” Kishore told ET in an interview.
The $180 billion Indian IT-BPM industry and their global counterparts have seen an increasing protectionism primary in the US, largest software services export market. Even though changes to the legislation pushed by the US administration have not come into force, there have tightenings of H-1B visa issuance process such as repeated request for evidence (RFEs).
Indian IT companies and their global peers use a significant chunk of the H-1B visas to deploy employees on high-skilled work on clients’ worksite.
In the past couple of years, Indian firms such as Tata Consultancy Services, Infosys, Wipro have ramped up local hiring in the US and have begun extensive training for the local hires on the back of increased protectionism.
Zensar, a 10000-employee firm, said it hired 1250 people in last 12 months and 50% of them in the US and UK, the majority being in the US.
“I don't think the immigration scene is going to dramatically change...We have to get ready by driving combination of higher technology (technology to collaborate with offshore), local hiring, M&A,” said Kishore.
Analysts say the operational models of IT services firms are transitioning to agile ones and that would require teams to be located closer to business for better results.
“Hence when this administration restricts the ability to bring these scarce skills into the US through restricting the number of H1Bs and L1s and makes the granting of these visas harder and less predictable, it directly affects these firms ability to build and scale these digital platforms and negatively affects the competitiveness of US firms,” said Peter Bendor-Samuel, chief executive, Everest Group, a global IT advisory and researcher.
He said IT services majors are adopting a hybrid model tommeet demand for high-skilled talent.
“US firms would much prefer to have their devops teams located close to their users and hence are showing a strong preference for work to be done in the US. However, (as) this is becoming increasingly difficult in the face of the growing skills shortage...companies such as TCS are capitalizing on this to create a hybrid model.”