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E-tailers’ business models have failed to work: T V Mohandas Pai

Business models of e-tailers in India are not just running out of steam but even have not worked, says information technology (IT) industry veteran T V Mohandas Pai.

“E-tailers will have large problems because their model is running out of steam. The model has not worked. So, people are reluctant to give them money. They got a challenge. They got work it out. It’s going to be a tough year,” the former Chief Financial Officer of Infosys said.

On the start-up scenario, the Chairman of Manipal Global Education Services and Aarin Capital, said good start-ups are finding fresh capital but those with business model without any differentiation are finding it tough.

“This is part of the start-up story. There will be high failure rate”, he said. “As I said earlier, 50 to 60 per cent of the start-ups will fail. 10 per cent will do exceptionally well”.

According to him, the Indian IT industry’s growth in the next two years will be in the region of seven to nine per cent ($11 billion to $13 billion) per year at best.

Pai dismissed some reports that suggested that 65 per cent of IT employees in India are not trainable.

“It is very wrong to say 60-65 per cent Indian IT cannot be re-trained. It’s very wrong statement. Indian IT…The average age (of employees) is 27 years,” he said.

“(If) people of 27-30 cannot be re-trained, then people of 45 cannot be re-trained. In Germany and the US, the average age is 40-plus. India succeeds because we have a group of people who are young and who can be trained. Training them in the cloud or big data or anything else is not a complex thing. They can be easily trained,” Pai said.

He was of the view that syllabus in engineering colleges needs an overhaul.

“We need a change in the model where faculty can change the syllabus based upon what is current; we need larger number of autonomous institutions and in those autonomous institutions and universities, faculty should be able to change the syllabus faster,” Pai said.

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