RIMS is the way forward

Ahana Systems was started in 2000 with focus on Remote Infrastructure Management and Training Services.  Now Ahana System has grown both in terms of revenue and service lines as also geography.  Mr. Uma Shankar Malligere, CEO and Founder Director of Ahana Systems and Services, Bengaluru talks about his plans, Indian Market and opinion on Indian services.

With respect to Ahana’s services, how does Ahana system look at the Indian market?

Indian IT outsourcing market is at the cross roads. There has been a big change in the way people outsource, and what they outsource, and what even service providers offer. This is mainly because of the emergence of the SMAC platform.  As a service provider, along with our customers, we are stepping into the elevator of innovation. What I mean here is that the need to adopt SMAC as a consumer engagement strategy is largely driven through various forms of smart devices, while customers are realizing the benefit of cloud as a platform.  We had anticipated this and started our Cloud and Green IT solutions couple of years back and also extended our services from training and IT infrastructure outsourcing into Enterprise Software and Risk Management solutions (SAP and Kondor Plus).

How are small and midsize IT system integrators finding the year 2014-2015?

I feel this is the right time to specialize.  Most of the IT software service providers of infrastructure services provide try to cover the entire landscape.  According to a NASSCOM report, the overall software service market will go up by 13% this year – that is around $146B, and out of which both domestic and exported software services have equal   growth rate.

There are a lot of software companies which try to work with startups – building their e-commerce platforms on open source and on cloud.  This comes under software product development and not under services.  However, I still see there is lot of scope of product development in-house.   People have to specialize or logically extend their service portfolio rather than build new service lines without business plans.  I see people build capabilities and not having business.  That is the biggest roadblock for small and mid size IT system integrators.

Another aspect is to farm existing customers.  Ahana has increased revenue per customer to more than 30% over the past couple of years.   This helps to keep the sales and business expansion overheads to a minimum.

Building partnerships and consortiums is a good way to leverage a partner’s skill and close skill gaps required to execute large projects.  I have reached out personally to fellow IT service providers, who have the skills that I don’t have, and that has worked out pretty well for me.  Again, here a caveat emptor rule applies.

How is your cloud infrastructure business going?  Is it a growth driver for your business?

Small businesses and E-commerce businesses will be our growth engine, in addition to traditional business expansion strategy over the next couple of years.  Most of these will come from Green IT and cloud services that we launched two years back.  According to a Gartner study, public cloud services revenue in India will reach $838 million by the end of 2015, an increase of almost 33 percent, or $206 million over 2014 revenue of $632 million. In the next two years, our cloud services revenue will be driven with our customers in India, Middle East and US, who are willing to offshore to us in terms of infrastructure management.  Some of the key services that we are offering are cloud infrastructure as a service (IaaS), cloud management and security services and cloud application infrastructure platform as a service (PaaS).  We expect at least 30% growth from our existing base on an annual rate, which is from a smaller base.

What are the factors that might drive customers increasingly towards cloud services instead of traditional IT outsourcing?

Our customers and new prospects who are seeking to engage system integrators like us for  IT outsourcing services are increasingly turning to public cloud services as an alternative to traditional outsourcing offerings. In fact, cloud services are not only being used for low-value or transient workloads but also increasingly for production workloads, including some mission-critical initiatives.

A Gartner’s report based on their latest cloud adoption survey, 53 percent of organizations in India indicate they are using cloud services today, with another 43 percent indicating plans to begin using cloud services in the next 12 months.  That could be email, and any non-core services.  The challenge of investing in infrastructure, managing and ensuring its optimal performance,  is easily mitigated by the IT outsourcing service.

We are investing in training more than 15 Cloud infrastructure management services including Google, Amazon Web Services and Microsoft platforms.  This with, our core competency of database management is a real asset here.

You have a long term relationship with Sybase and now with SAP?  It is a kind of symbiotic group. Would you share some insights into this arrangement?

I am personally a Sybase specialist – with more than a decade of experience.  So it was natural for us to start with Sybase.  We are   authorized resellers  and have seen Sybase growth cycles, as well as its acquisition by SAP and its re-emergence in the market as an integrated enterprise player.  SAP partnership, now 2 years old is a logical extension of what we do – mobility, cloud and database technologies services. Apart from that, we have started SAP Enterprise Software implementation.

We are getting lot of interest from our existing customers in terms of how we propose cloud, mobility and database technologies into SAP Enterprise software platform.   Our partnership extends from now SAP R/3 to SAP Business One.  That covers the entire gamut of Enterprise to Cloud and SMB platforms as customers.

I would like to state here that our core strength of SAP Basis, along with our database management makes us logically extend our services.   We have nearly doubled our SAP partnership revenue in the last one year.

We understand that the training services are getting highly commoditized?  How do you plan to increase revenue there?

Our training services are divided into corporate as well as individual training.  We have started extending composite packages – for example, if you are an IT support personnel, we train you on areas of Service management, soft skills, technology as a package. That makes our training courses sort after especially in IT support, Development operations areas etc,  with corporates, we are concentrating on our existing client base, which has helped us almost double our training revenues.   Database technologies are still sought after despite newer technologies entering the market and happily, that is our core competency.   We have added cloud architecture and support portfolio as well.  This way, we are up with the times, and flexible to make this work.

Please share with us your plans for geographical expansion?

We already have customers from the US, the UK, Middle East and in India.  Our focus is to expand in Mumbai in India, where we now have an office and we have direct present in the UK.  Our senior management travels to meet clients both in terms of service performance review and for new business opportunities.  We are doing well   and we feel that we are going at the right pace.  Our core focus had been Banking, Insurance and Capital markets, and now we are looking at manufacturing and e-commerce sectors as well.