InformationWeek - - Perspective -

Fall­ing value of ru­pee is a ma­jor con­cern for ev­ery In­dian or­ga­ni­za­tion es­pe­cially whose busi­ness is “net im­port”, i.e., where the im­port is more than ex­ports in terms of value. This fall af­fects sig­nif­i­cantly the in­put cost neg­a­tively and pro­pels the in­fla­tion. In terms of IT cost, most of the IT de­vices are im­ported be it servers or net­work­ing equip­ment. But the im­pact of this in­crease in to­tal IT cost will not be that sig­nif­i­cant as con­tent of im­port and de­pen­dent IT cost is in gen­eral around 10-15 per­cent. Sig­nif­i­cant por­tion of IT cost namely IT staff cost, op­er­at­ing cost, etc., are paid in ru­pee terms.

The se­vere prob­lem is slow­ing down of econ­omy. Lo­cal de­mand has come down due to se­vere in­fla­tion­ary pres­sure, which is not di­rectly con­nected to fall in ru­pee value. Higher spend­ing on ba­sic necessities leave very lit­tle amount for the aver­age In­dian to spend on com­forts and lux­u­ries leave alone sav­ings. With cur­rent good mon­soon and elec­tion spend­ing next year, In­dian econ­omy will re­vive and put the growth back to 7 per­cent plus.

In my opin­ion, the fall in ru­pee is a tem­po­rary phe­nom­e­non and will get cor­rected soon.

In th­ese un­cer­tain times, I would ad­vise fel­low CIOs the fol­low­ing: Plan for IT spend­ing very cau­tiously. Do not ini­ti­ate the pro­ject for sake of tech­nol­ogy but based on busi­ness im­por­tance and ROI. Fo­cus on op­ti­miz­ing im­ple­mented projects and run­ning and en­sure all in­tended ben­e­fits are ob­tained. This is a good op­por­tu­nity to go closer to users and work closely with CxOs. They will be keen to share their pain points.

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