The end of ITES as we know it

ITES as we know it today is not going to be an industry 5 years from now

Either they need to pivot hard into making products, but I think that's next to impossible given none of them are founder led anymore

A better option is for them spend large amounts of money on acquiring product companies and scaling it with their enterprise sales muscle.

Plus of course they need to immediately start disrupting themselves by automating large parts of their current workflows.

Because as of now they are getting squeezed from multiple angles:

Fortune 1000 companies now know how to setup their own centres in India thanks to companies like ANSR and Zinnov. Theyre going direct. So reduced need for outsourcing to ITES firms.

Employees of ITES firms are going to go work in GCCs who'd pay them much higher plus have much better brand recognition. Some 30% of GCC hiring happens from ITES companies

WITCH (Wipro, Infosys, TCS, etc) companies tend to charge on number of employees deployed onto a client project. But gen ai coding is already great today and its going to be even more magical 3-5 years from now. We're going to need far leaner teams to do the job. So labour arbitrage as a business model is going to be far less lucrative in the coming year

We see articles such as "TCS trains 350k employees in GenAI", which makes things seem hopeful for ITES, but the reality is likely far from that. i forget where I read this, maybe reddit, but apparently its trivially easy to pass the test to get certified. which means it equipped them with little to no actionable skills

They can't attract talented engineers. When have you seen a solid engineer decide to work at a WITCH company when they also had a product startup offer in hand.

The tarriff / h1b issues are a problem too, but arent as fundamentally affecting ITES unlike the above 5 points