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Accelerating Digital Transformation Due to Remote Working

IBEF, Knowledge Centre

Apr 27, 2021 17:39

Marking One Year of Lockdown across the Country
As COVID-19-induced national lockdown completes a year in March 2021, we realise that digital technologies have played a critical role in our lives over the past year. Working from home (WFH) was a concept often frowned upon by organisations until the pandemic forced us to rethink work and work environments. Businesses, large and small, have made efforts to facilitate this transition by adopting new digital technologies. In the last few months of locking down employees around the worldwide, technology has become essential to tracking, managing and improving people's experience, commitment, well-being, human connections and productivity. Organisations such as Facebook, Twitter, Google, Microsoft and Square have announced plans to allow employees to work from anywhere (WFA) even in the future.

Government Relaxed Regulations for Other Service Providers (OSPs) to Facilitate WFH
The new regulations aim to position India as one of the competitive IT jurisdictions in the world by removing unnecessary bureaucratic restrictions. On November 06, 2020, the government announced simplified rules for OSPs (include Business process management (BPM), business process outsourcing (BPOs), knowledge process outsourcing (KPOs) and information technology-enabled services (ITES) —and eliminated most of the registration and compliance requirements to facilitate permanent WFH and WFA. In addition, submission of bank guarantees, need for stable IP, obligation of frequent reporting, publication of network diagrams, penal provisions and several other requirements, which were preventing businesses from adopting WFH and WFA policies, have been eliminated.

Prime Minister Narendra Modi, in a tweet dated November 05, 2020, said, “India's IT sector is our pride. The prowess of this sector is recognised globally. We are committed to doing everything possible to ensure a conducive environment for growth and innovation in India. Today's decisions will especially encourage young talent in the sector!”

NASSCOM, in a press release dated November 06, 2021, said, “It is extremely heartening to see the government’s commitment towards Ease of Doing Business and focus on the IT-BPM industry’s sustainable future. We are grateful to the IT Minister for this landmark decision, acknowledging the industry’s needs in this regard and issuing guidelines simplifying the OSP rules. The new guidelines will tremendously reduce compliance burden of the BPM industry. The registration requirement for OSPs has also been eliminated. There are some security-related obligations for voice-based OSP, which appear to be fine. The BPM industry, engaged in data-related work, has been completely taken out of the ambit in defining an OSP. Access to remote working will give our industry an epic boost and significantly expand access to talent, increase job creation and catapult Indian IT and BPM to the next level of growth and innovation, thereby making India a global tech hub.”

The Government is Working on a Proposal to Formalise WFH
Model standing orders set standards for the terms of service and employee conduct in an institution. There are no such standards for the services sector so far, it is being proposed for the first time. These standing orders will be applied to organisations with a workforce of 300 or more. It also published draft model standing orders for the manufacturing and mining sectors for stakeholder feedback.

The Ministry of Labour stated, “Subject to conditions of appointment or agreement between employers and workers, employers may allow an employee to work from home for such period(s) as may be determined by the employer.”

Shyam Sundar, labour ministry official, said, “Without proper regulations for WFH, employees will be left at the mercy of employers. Employees’ bargaining power will be reduced. WFH should also figure in the model standing orders for the manufacturing sector. The concept of WFH should be left for the individual establishment to decide, whether it is in the manufacturing or services sector.”

Rajiv Kapoor, member of the CII national committee on industrial relations, said, “Manufacturing should also be given the WFH facility, but I would suggest that it should be left to the discretion of an individual organisation, be it in the manufacturing or services sector. With the advent of digitisation and technology, many jobs in the manufacturing sector can now also be done from home, specially design and other office work.”

IT Budgets Shift to Mature Processes around Remote Business
According to Gartner's latest forecast, global IT spending is projected to reach US$ 3.9 trillion in 2021, a 6.2% increase from 2020.

IT spending in India is expected to total US$ 81.9 billion in 2021, a 6% increase over 2020, according to the latest forecast by Gartner, Inc. Spending is expected to increase on technologies including advanced analytical solutions, access management, encryption software, desktop as a service, cloud and hyper-automation systems. IT solutions such as Robotic Process Automation (RPA), Artificial Intelligence (AI), Machine Learning (ML) and Digital Commerce will also record increased spending.

Accelerating demand for cloud services – The trend towards cloud services has stimulated investments in very large-scale data centres, with global investments expected to exceed approximately US$ 200 billion annually by 2025. India is expected to gain a significant share of the global market, with the country's investment expected to reach about US$ 5 billion annually by 2025.

Recent Developments by Key IT Players
In January 2021, TCS introduced a customised version of ‘TCS Cloud Exponence’ on Microsoft Azure, its flagship cloud management and orchestration platform, to offer smart managed services in hybrid cloud environments.

In January 2021, Wipro announced its partnership with Fiat Chrysler Automobiles (FCA) to establish its first worldwide digital centre (FCA), FCA ICT India, in Hyderabad.

In February 2021, Tata Communications announced that its collaboration with Google Cloud will accelerate cloud services uptake and transform companies in India. Through this partnership, it has expanded its managed public cloud services portfolio to include Google Cloud capabilities.

In February 2021, HCL Technologies (HCL), announced a five-year ‘Digital Workplace Services’ agreement with Airbus. HCL will create a modernised digital workspace for Airbus employees worldwide to improve customer experience and service quality.

SMEs in Western Countries Turn to India for Virtual Staffing
“SMEs in western countries are leveraging remote working solutions to accelerate offshore hiring from India,” reported LiveMint. Companies are approaching staffing firms in India to hire people who can work from anywhere in the country, but on western schedules. Technology companies also remain one of the major employers that want coders and engineers to work remotely.

Viral Thakker, Partner at Deloitte, said, “Work from home has opened up the broader thinking around work from anywhere.”

Kamal Karanth, Co-founder of staffing firm Xpheno, said, “Ideally they would outsource these to call centres or proper BPOs in India. But now they’re saying why go to those firms if there are credible players whom they can rely upon for staffing.”

The Road Ahead – Continued Journey to Digital Transformation
The smart use of technology to support the evolution of digital transformation continues to be a key focus area for organisations in 2021. The rapid transition to remote working and digitisation of services (amid the pandemic) has made it possible for businesses to take a leap forward in their digital transformation journey. McKinsey Digital estimated that five years of digital adoption took place in only eight weeks in mid-2020. HR & payroll teams can rely on leading-edge technologies, such as Robotic Process Automation and AI, to simplify tasks that require a lot of data and are subject to human errors, and set aside human time to deal with more complex issues. Investments in Business Intelligence (BI) software and predictive analytics are on the rise, as businesses seek to facilitate strategic decision-making with the help of workforce management data and information.