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Strategic IT Investment to Expedite India’s Power Reforms, says Springboard Research


Published On: 8/6/2010
Geography: India/South Asia
Technology: Vertical Markets

New Delhi, August 6, 2010 – IT market for power Transmission and Distribution (T&D) companies in India is estimated at around US$305 million in 2010, and is forecast to reach US$569 million by 2013, growing at a Compounded Annual Growth Rate (CAGR) of 22.6% from 2009-2013, says the latest report “IT in India's Power Sector” from Springboard Research, a leading innovator in the IT Market Research industry. The attempts to transform the sector are presenting challenges that can only be addressed by implementing IT, and thus the important role of IT is finally being acknowledged and the necessary funds allotted.

“Power sector organizations in India have now realized that they need to be more efficient, effective, productive and profitable. Effective application of IT comes up as a solution to overcome most of the challenges”, said Nilotpal Chakravarti, Manager, Vertical Industries at Springboard Research. “Moreover, the government and utilities have also started responding with greater attention and increased funding. The US$2 billion commitment to IT initiatives in the Restructured Accelerated Power Development Reforms Program (R-APDRP) underscores this awareness”, added Mr. Chakravarti.  

Managed Services are Most Preferred Outsourcing Model for Power Companies

According to the survey conducted by Springboard, 20% of respondents reported to opt for a managed services model in the future. The report further notes that most T&D companies prefer the model as it is a cost-effective way to implement IT projects that support strategic initiatives. It also reduces dependency on third-parties and allows the company to focus on core business rather than on IT-related areas.

Commercial Management and ERP are Top Focus Areas for Investment 

Springboard’s survey results confirmed that Commercial Management is the top focus area for strategic IT investments in India’s power sector, as reported by 77% of the respondents, while ERP stands at 67%.   

Springboard concludes that IT has the potential to contribute significantly to the power reform process, particularly in the key areas such as business process automation, revenue and commercial management, distribution system automation, CRM and ATC loss reduction. However, there are some challenges that need to be tackled to optimize the utilization of IT. According to the survey, the key ones include ‘lack of skilled manpower’ as stated by 25% respondents, and ‘system downtime’ (15%). While some of the respondents mentioned “no issues”, Springboard finds that the absence of IT problems can be attributed to the fact that most power companies have a very simple IT system in place or have only started building an IT infrastructure.  

The report further observed that a large number of IT vendors are now targeting the power sector as the industry is rapidly gaining momentum. The survey named SAP, Oracle and IBM as the perceived leading IT vendors in the space.

“While the T&D companies look to invest in IT to streamline operations, IT vendors should act as an enabler and change agent in the evolving business dynamics. Furthermore, for IT investments to succeed, discoms must devise a proper IT roadmap, and IT solution providers must guide their clients toward adopting a holistic IT framework, which will help them align their business with IT”, recommends Mr. Chakravarti. 

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About this Report

The Springboard Research report - “IT in India’s Power Sector” - highlights the emerging trends and market opportunities in the power sector of India. It assesses the opportunities the industry presents to IT companies in 2010 and examines the key Transmission and Distribution companies in the power industry’s public and private sector segments. It also includes market data - market size and growth forecasts, to provide insight into the power sector for a big picture industry perspective. The insights in this report are derived from supply and demand-side primary research, and supplemented by secondary research. Springboard Research conducted a survey of IT decision makers at major power distribution companies (discoms) in India and key decision makers at leading IT vendor companies offering solutions to the power sector in India.

About Springboard Research

With visionaries others pursue, methods others neglect and ideas others don’t consider, Springboard Research not only seeks to lead an industry – we seek to transform it. Leveraging our pioneering research model and industry thought leaders, Springboard provides greater insight, analysis, and innovation specific to global emerging markets. Working with leading technology vendors, IT professionals, and local channels, Springboard helps our clients lead, rather than follow, market trends.

Springboard has a global presence with research centers in Australia, China, India, Japan, Malaysia, Pakistan, Singapore, the UAE, and the US. We have been acknowledged as an emerging leader and for the last three years been named a “Rising Star” in the global IT market research industry by Outsell, the leading research and advisory firm for the information industry. For more information and access to Springboard’s research, please visit www.springboardresearch.com

Media Contacts

Jonita Dhani, Marketing Executive
Springboard Research
91-11-4051-8252
[email protected]  

Nilotpal Chakravarti, Manager, Vertical Industries  
Springboard Research
91-11-4051-8236

[email protected]
 
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