Don’t blame AI or Trump tariff: Indian IT faces deep trouble, says Zoho founder Sridhar Vembu. And jobs? Economic Times: 18th April 2025
Sridhar Vembu, Chief Scientist at Zoho Corporation, has offered a clear and honest view on the current state of the Indian IT industry. After the recent weak performance by large companies like TCS, Infosys, and Wipro, he believes the problems run deeper than most people think.
This is not just a temporary slowdown or something caused by global politics or artificial intelligence. According to Vembu, the Indian IT sector is entering a long period of transformation. The old ways of working are no longer effective, and the industry must face some hard truths.
What Went WrongFor many years, the software and IT services industry operated on systems that were not truly efficient. Over-hiring, complex processes, and billing clients by the hour became the standard. These models worked when there was plenty of money and growing demand, but they were not built for long-term sustainability.
Vembu points out that many of these habits were borrowed from the West. Indian IT companies followed the same structure, and for a while, it brought growth. But now, those same practices are starting to show their weaknesses.
He also mentions that artificial intelligence, while often seen as a threat, is not the main problem at this point. It has brought some productivity gains, but the real issue is the way the industry has been built—on outdated methods that no longer make sense in today’s world.
In the past, during times like the 2008 financial crisis, companies managed to stay afloat because of easy access to funding. That safety net no longer exists. Now, the industry must confront these issues head-on.
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He suggests that the IT industry can learn from this. The time has come to stop relying on size, scale, and outdated billing models. Instead, companies need to rethink how they work and focus on delivering real value.
The Way ForwardThe Indian IT industry needs to make some important changes. First, it should move away from billing based on time and focus more on the value of the work delivered. Second, it needs to build simpler and more efficient systems. Third, hiring should be based on skills and outcomes, not just numbers. And finally, training must go beyond just technical knowledge and include problem-solving, design thinking, and innovation.
ConclusionThe message is clear. The next thirty years will not look like the last. The old ways are no longer enough. This is not just a downturn—it is a turning point. The Indian IT industry must evolve. There is a real opportunity here to rebuild on stronger, smarter foundations.
Companies that are ready to question their habits, rethink their strategies, and focus on meaningful change will lead the way forward. Those who don’t may be left behind.
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