SUMMARY
With GDPR, What Does The Future Hold For The Indian Tech Sector?
India’s rise as a super-economy has been nothing short of spectacular. The country emerged as a global technological powerhouse providing solutions, resources, and skilled manpower to countries around the world. Recent government-led initiatives, such as Digital India and the Smart Cities Mission, have added further impetus to its ongoing transformation into a digitally-empowered nation.
One of the biggest factors behind India’s growing reputation as a technological hub is the performance of its outsourcing industry. From BPOs to KPOs and ITOs, Indian businesses have been managing key functions for both large MNCs and smaller enterprises across the world at a fraction of the cost of establishing and managing in-house processes.
This holds especially true for the country’s $146 Bn IT outsourcing industry, which has registered impressive growth over the past decade or so by extending high-quality technological capabilities to its global counterparts at extremely low costs.
Europe, in particular, has been an important market for Indian IT companies. The region accounted for 30% of the total revenues generated by the industry, behind only the United States. But, with the European Union set to soon enforce the General Data Protection Regulation (GDPR), what does the future hold for the Indian tech sector?
The long and short of IT: The GDPR and Indian IT businesses
Indian IT businesses managing partial or entire IT processes for their European clients naturally have access to a variety of data – including personal data – from the region. This brings Indian enterprises under the ambit of the GPDR, which makes it mandatory for them to implement data privacy and security frameworks compliant with the outlined regulation.
Amongst the various business functions expected to be affected by the GDPR, marketing stands out as the one impacted most. Remember sifting through all those email promotions in your inbox? With the GDPR about to come into effect, emailing without explicit permission will be a thing of the past as far as EU citizens go.
Under the GDPR, businesses will need to obtain consent from every consumer that they market to. This consent is needed at the point of data collection, and must also be documented and accessible enough to be reproduced as proof, if required. The GDPR will also restrict the number of use-cases that the personal data of EU citizens can be used for.
But while the transition will no doubt be fraught with challenges, the upcoming GDPR enforcement also presents an opportunity for Indian companies to use the learning from their internal transformation to assist other businesses achieve compliance.
According to recent industry research, the nascent GDPR services market is expected to be worth $1.1 Bn within the next four years, and data might just hold the key to unlocking this huge business opportunity.
Data is as data does: The need for better data visibility
With GDPR, companies will now be required to take a deeper look at their internal data operations, as well as those of their business partners.
Take, for instance, the requirement to ensure the highest levels of data privacy for EU citizens. The GDPR will empower data subjects by giving them greater control over their personally identifiable information (PII). Under the new regulation, they will have the right to know what their personal data will be used for by a business.
Data subjects are required to give clear and explicit consent to enterprises for handling their data, and also have the right to request it to be deleted or “forgotten” at any given time. This presents an extremely complex challenge to businesses, who would need both macroscopic and microscopic views of their data in real-time and how well it aligns with the GDPR regulations.
The GDPR is also expected to completely transform digital marketing, giving Indian tech businesses an unprecedented opportunity to reorient and reimagine their marketing strategies in the region. By communicating to their consumers, in as clear and precise a manner as possible, about the private information that they need to collect and the security measures implemented to keep it secure, they can enable better data transparency. This, in turn, can help in building greater trust between consumers and organisations.
Marketing communications will become more targeted, innovative, and effective as a result, even as businesses differentiate themselves in the market by underlining the value they place on their users’ information and privacy.
A landmark move, the GDPR has been hailed as a much-needed, game-changing development which will set the benchmark for any future international regulations pertaining to data privacy and protection. Given how well-integrated they are with the global business landscape, Indian IT companies that align themselves with the changing dynamics of personal data management through cutting-edge data analytics, can ensure that they are in a stronger strategic position to drive continued growth – for themselves, and for the larger IT services ecosystem in India.
