Travel advisories a concern for IT

NEW DELHI: War fears may have receded, but the travel advisories are still there. And, this is stalling the IT and IT-enabled services’ return to usual business.
Customer visits to India had ground to a halt after many western nations issued advisories to its citizens for not visiting the country. The absence of customer visits — a key ritual before a potential client decides on whom to choose as its outsourcing partner — means elongation of the sales cycle.While this will not immediately reflect on revenues, it has the potential to become an irritant within six to nine months.
A typical IT outsourcing contract takes six months to complete from the time a request for proposals (RFP) is floated. In the IT-enabled services or BPO sector, the sales cycle are even longer.
“Customer visits have still not resumed despite the war fears cooling down. While we do not see any immediate impact, if the uncertainty continues it can have a long-term impact, blunting India’s edge as a premier destination for IT outsourcing,� said Phiroz Vandrevala, EVP of TCS. “Once the travel advisories are withdrawn, it will take another few weeks before client makes travel plans and resume their visits,� adds Raman Roy, CEO of Spectramind, a leading IT-enabled services provider. But Roy adds that “at least our existing clients understand that the present imbroglio is more of a political sabre rattling than anything else. However, the key question is till when will their patience last.�
Infosys recently said the war hysteria would not have an immediate impact but could cloud long-term prospects if it lingered on. Wipro V-C Vivek Paul in a recent interview also voiced similar concerns saying, uncertainty will impact long term competitiveness. The IT services industry has been hit by lowered technology spending in the US and Europe in the aftermath of a slowdown. The war-related uncertainty has hit firms just when the things were looking up.