Investing in Skilled People and the Growth of the Technology Industry
When a government invests in skilled people and the growth of the technology industry, among other things, a country might obtain a competitive edge over other nations, according to the Porters diamond framework. Porter's framework ignores a number of variables that India has skillfully incorporated, chief among them being firm strategy. India's IT industry is worth about $150 billion, and this can be attributed to the intense competition among the numerous businesses, which has sparked innovation and raised production. The top ten software businesses in the world by market capitalization include one company from the nation.
Rivalry, Structure, and Outsourcing
Rivalry and structure have both been important. Because of their ingrained tradition, most Indian laborers put in longer hours at work and in them, they also make less compared to their counterparts in the United States of America and in the United Kingdom (Jugale, 2012). The disparity has resulted in the outsourcing of jobs to India. Additionally, Indians place a very strong emphasis on hierarchy and, therefore, it is very easy to get a company to focus on one direction.
Interrelated Industries
Industries in India are related and they support each other. When an industry is diverse, it benefits from the sharing of information and ideas and also the production of complementary products. The software industry in India has benefited from this. For instance, when Flipkart went online, there was a need for a call center to support its operations.
Demand and Factor Conditions
Demand and factor conditions help explain the success of the software industry in India. The country has a large population which translates into a huge market. As the economy grows, it means more people now have access to some disposable income. The factor conditions are the creation of a large cadre of skilled labor, appropriate infrastructure, and capital. India has done all this, including investing in tertiary education. Three universities, including one which deals primarily with IT, are ranked in the top two hundred globally. The industry is currently employing over 4 million people.
Software Industry vs. Hardware Industry
Through demand and factor conditions, the software industry trounces the hardware industry in that as the population of people with disposable income grows, they will seek quality products and India is not known to deliver on this. The related industries, particularly the manufacturing ones, are coming under increased scrutiny due to working conditions and increased calls for sustainability. This does not affect the software part too much. When it comes to framework and strategy, software engineers take the majority of the H1-B visas to the United States to work for companies like TATA, Tech Mahindra. This gives them a competitive edge as they sample the best of the U.S infrastructure on software.
The Future of the Industry
The industry will continue to grow over the five years due to the ballooning middle-class citizens and a resurgent economy growing at a steady rate of 7%. However, a sizeable number of jobs could be lost due to the looming threat of Artificial Intelligence and automation (Rapoza, 2017).
References
Jugale, P. (2012). Software industry in India. Retrieved from http://www.serialsjournals.com/serialjournalmanager/pdf/1343120571.pdf
Rapoza, K. (2017). Tougher times ahead for India IT companies. Retrieved from https://www.forbes.com/sites/kenrapoza/2017/05/15/tougher-times-ahead-for-india-it-companies/#69c915995097
