India-3 to challenge IBM146;s dominance by 2011

These emerging mega-vendors are much smaller than the current players but would increasingly compete for the same mega deals that had been the exclusive domain of the incumbents.

8220;The emerging mega-vendors have made dramatic progress in the past few years and have more than doubled their revenue in a four-year period, with the 2007 revenue being 2.6 times the 2004 revenue,8221; said Gartner analyst, regional research director and vice-president Partha Iyengar.

The research company has observed that key competencies, including process excellence and world-class HR practices would be the reasons for the emergence of the three companies as mega vendors.

However, it has also observed that having a level of revenue per employee similar to the current mega-vendors is a challenge that these companies need to address to achieve their mega-vendor status.

The Indian providers would have to address the issue of moving away from resource-intensive revenue growth to a model that provides higher leverage and increases revenue without a linear relationship to head count, which is the situation that exists today. They would have to achieve similar levels of revenue per employee benchmarks to truly achieve mega-vendor status.

8220;There are strong indicators that India-3 will be the next mega vendors in IT services. However, to achieve this, the current standing of India-3 will need to expand quickly to keep pace with the changing client environment for IT delivery in the future,8221; said Iyengar.