KOCHI: Financial crunch, cutback by clients and redundant office spaces have largely affected the IT industry despite the early shift to the work from home mode. Additionally, remote work has brought in a fresh set of challenges
The IT sector was quick to adapt to the changes brought in by the pandemic. Firms in the sector were the first to fully transition to the ‘work from home’ mode and continue operations in line with the standard business process. But as the pandemic continues to affect all businesses, the IT sector is also facing hiccups in its operation.Several IT companies in the micro, small and medium enterprises (MSME) category are facing a fund crunch, due to the cutback by clients and several of them dropping out of deals from foreign shores. According to industry experts, there is a general uncertainty among companies on supporting the entire workforce and maintaining rented office spaces which have now become redundant due to the work-from-home shift. Many employers are adopting variable pay to employees to tide over the tough times.
“We had successfully transitioned to work from home and are looking forward to keeping the arrangement in place till the next year. This ensures that all our operations are carried out as per norms, with no cutback for employees. But the general scenario remains tough for companies as the vast majority of clients are from countries that have been adversely affected by the pandemic. There has been a slowdown in the acquisition and onboarding of new clients and projects. There has also been a decline in spending which has brought down the value of projects,” said Abhilash Subash, CEO of Urolime Technologies, a software company based in Infopark.
For IT companies which require on-site tests and demos, the lockdown meant a delay in operations, which in turn deferred payments.“For companies that cater to a niche market in metro cities, the lockdown has affected the current revenue stream. Business-to-business operations too are affected as many new projects are being cancelled or postponed. There is also a slowdown in the funding of startups in the IT field,” said Rajith Nair, CEO of Inntot Technologies Private Limited, which focuses on enabling cost-effective digital media receivers.
The transition to remote work has brought challenges to product-based IT companies. “Training clients to become adept at using our products has now shifted online, which has brought in a set of challenges. Acquiring new customers is another issue. A recent survey found that cross-selling by companies could be the solution to this. This concept is yet to gain traction in our work culture. Companies using their presence in certain markets to promote others’ products is a mutually advantageous set-up,” said Josemone K K, CEO of Grandtrust InfoTech Private Limited.