Porter's Five Forces In Software Services Industry

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Contents Relevant Industry, Product and Geographical Scope 2 Different segments in IT industry their profitability and industry structural forces 3 Performance of each sector 4 Market share of major IT players based on revenues (FY2012) 4 Distinct cluster of firms, strategies, classification 4 What is the degree of concentration in your industry? What is the 4 firm concentration ratio? What is the Herfindahl Index? 5 Porter’s 5 Forces Analysis on the Software Services Industry and the major players in these boxes 6 Existing Rivalry: 7 Bargaining power of the suppliers: 7 Bargaining power of the buyers: 7 Threat of Substitutes: 8 Threat of New Entrants: 8 Forces to assess software services industry 9 Most important force in software service…show more content…
Information Technology (IT) industry in India has been one of the most significant growth contributors for the Indian economy. The industry has played a significant role in transforming India’s image into a global player in providing world class technology solutions and services. The industry has helped India transform from a rural and agriculture-based economy to a service based economy. India’s IT potential is on a steady rise, improving its technological capabilities in all fields. India's IT industry can be divided into five main components: Software Products, IT services, Engineering and R&D services, ITES/BPO (IT-enabled services/Business Process Outsourcing) and Hardware. Export revenues are primarily based on IT services. According to NASSCOM IT services accounts for 54.2% of total revenues followed by BPO and Engineering services at 19.5%, Software Products at 15.3% and hardware at 11%. Overview of IT Industry Souce:(Shastra) There is an increasing competition in this industry, low-end services are being commoditized. There is a pressure on billing rates from the supply side, so Indian software industry needed to make a fast move up in the value chain. Now the companies are providing higher value-added services like product development, R&D, consulting, social media, mobility, analytics (digital technologies), and cloud computing…show more content…
This software can be used for banking, security, documentation etc. ITES Business process outsourcing (BPO) – Many companies worldwide outsource their back-office work to some other company located elsewhere. Indian BPO employs people to work for these companies worldwide. IT- Hardware and peripherals – The tangible components in IT industry which you can touch and feel is hardware. These would include wide variety of peripherals like laptops, desktops, storage devices, networking devices, printers, optical mouse, displays etc. IT- Education – This includes companies providing certifications like Java, Oracle etc. The companies in this segment provide training for human resources in other segments. Recently these companies have expanded to other sectors also (like schools, colleges, transport
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