Japan IT Services Market - Challenge!

By admin, August 28, 2007 1:39 am

Japan's IT services market is expected to grow to $107 billion by 2008 - a compound annual growth rate (CAGR) of 8.7 per cent. It accounts for over a third of the total revenues for the Indian IT-ITeS exports to Asia, Oceania and West Asia. Revenues from the IT services' account form approximately 3 per cent of the Japan's gross domestic product (GDP).

However, there are only a handful of companies that have a presence in Japan. Some of these include Tata Consultancy Services (TCS), Wipro, Patni, and Zensar. But despite these companies being in Japan for close to 10 years, the country contributes just about 5-7 per cent of the revenues of these companies.

H Venkatesh, VP, Japan and APAC business, Wipro Technologies, says: "Initial years were very tough but the past few years have been fairly smooth." He points out that this has happened due to their initiative to understand the culture and the people. The company has a five-and-a-half-month course 'Shimpo' for its engineers. This period is strictly utilised for learning the language and nuances of japanese culture.

"Our continued effort in nurturing relationship has paid well. Moving ahead, we see a rapid growth in product engineering services related to consumer electronics and the automotive segment. Moreover, Japanese companies are increasingly going global and hence it's a huge opportunity for Indian companies to provide services to both the Japanese companies as well as their customers," says Deepak Khosla, senior vice president, Patni. The company has over 200 people at its Japan centre.

There have even been cases when Indian companies have shut operations in the region due to culture and language constraints. However, all agree that though it is difficult to enter, once the required comfort level is reached, Japanese companies rarely abandon relationships. "There are three cultures that we need to understand. First is the country culture, followed by the company and then the managerial level culture," says Venkatesh.


Tags: japan - IT+Services - wipro - patni - india

Prashanth Rai 

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