Why Bharat is "Atmanirbhar" for SaaS software?

February 20, 2023

Almost all Indian ET 500 companies use one or the other ERP suite from a Multi-national company, typically from USA, UK or EU. India Inc. started deploying ERPs in right earnest only after mid-1995 and MNC software such as SAP, Oracle, Peoplesoft had a field day in absence of any meaningful local competition.

But the next wave of technology- mainly in the form of Software as a Service (SaaS)- is already challenging the dominance of SAP, Oracle, Dynamics etc.

Why will Indian built SaaS beat MNC software? Here are possible reasons:

Lower Cost structure

  • Most MNC software companies mainly serve US, UK and EU markets and thus have no reason to develop low cost software for a poor backwaters country
  • MNCs recruit talent from most expensive engineering and management schools and offer them a certain work lifestyle- not much scope for frugality
  • Indian SaaS companies typically offer a price that is one tenth of MNC software and that too is on a monthly rental basis. To be profitable, SaaS companies focus on smaller and nimble teams, remote deployments and simpler training

No "consulting" charges

  • Most MNCs package companies work with a consulting partner to deploy the solution. Typically when a customer pays Rs. 100 for software itself, the consulting and deployment service costs another Rs. 100 if not more. Naturally, the projects last for months and on-site teams are a "must"
  • Indian SaaS companies offer an All-inclusive price that includes software, deployment and training. SaaS companies get revenue only when customer starts USING the system as pricing is typically based on transaction volume
  • Thus, Indian SaaS companies run a very tight ship and focus on fast deployments, most of it done remotely

Focus on Bharat

  • Most MNC software is built for the English speaking elite of India's corporate world. They typically target large Indian and MNC companies with a large user base. But such companies account for less than 5% of Indian workforce.
  • SaaS companies very well understand the MNC fixation of large companies and thus focus on mid-sized Indian firms to start with where decision is quick and deployment is guaranteed by owner/promoter
  • One typical complaint about MNC software is they are way too complex and over-engineered. SaaS companies on the other hand offer solutions that are much more near to ground realities of Bharat.

SaaS offers latest technology and features

  • Yes, this may be counter intuitive. But as SaaS is more recent, they have been able to take latest technology and build the solutions afresh
  • SaaS companies are "Born in Cloud" and focus on Mobile solutions, multi-language capabilities, user lighter User Interface and focus tremendously on User Experience.
  • Also, SaaS companies learn from hundreds of users and add features every month. This offers latest features to every customers at SAME INVESTMENT

SaaS companies in India are stealing a march over MNC software. While the established, big Indian and MNC companies may continue to remain in thrall of "Global Best of Breed" solutions- their counterparts in Bharat are stealing a march with much better and cheaper technology.