The business world is being disrupted by the combined effects of growing emerging economies, shifts in global demographics, ubiquity of technology and accountability regulation. Infosys believes that to compete in the flat world, businesses must shift their operational priorities.

Main | August 2006 »

July 31, 2006

In a Flat World, Operational Excellence is Strategy

by Nandan M. Nilekani

Over the last 25 years, IT has been the prime mover in creating millions of jobs, not just in IT firms but in all the industries and services needed to support it. 

Yet in many ways the next five years are going to be critical for the IT revolution. It is becoming increasingly clear that this is not just about a few back office jobs. The flat world created by the confluence of technology, globalization, demographics and the rising economic power of India and China is making companies fundamentally alter their business assumptions. What and where they produce, whom they sell to, at what price, and how they manage it all – the  fundamental tenets of their business model are being entirely revisited.

This is likely to lead to the most dramatic transformation of firms in every aspect of their business, as significant as the role of mass manufacturing in remaking the industrial revolution in the early 20th century.

In this new environment, companies that are able to increase productivity, use technology intelligently, globalize their talent base and practice financial discipline will derive sustainable competitive advantage.

But achieving this will require from all of us who are in a position to effect change, a strategic view not a tactical response to get through the next quarter. It would require us to question fundamental business assumptions and drive long-term operational changes – for in a flat world, operational excellence is strategy.