Companies continue to spend on tech to create cost-saving solutions, says Capgemini’s Ashwin Yardi

Ashwin Yardi, chief executive officer (CEO) of Capgemini Technology Services India.

Companies plan to rationalise spending while also continuing to create new technology solutions to boost cost-saving efforts, according to Ashwin Yardi, chief executive officer (CEO) of Capgemini Technology Services India. The focus on rationalisation comes as client spending shifts towards cost optimisation amid a challenging macroeconomic environment, as opposed to large-scale transformation deals, a trend seen across IT services companies.

“A lot of focus is on spending, but creating new solutions using technology to drive cost savings,” Yardi said at the Nasscom Technology Leadership Forum (NTLF) 2023.

Almost two-thirds of respondents to a Capgemini survey of CEOs and chief information officers (CIOs) want to spend on technology to drive cost-saving initiatives, Yardi said.

“The important thing is they want to spend on technology. Further, 70 percent of them said that they do want to spend, but they are looking at new business models, servitization, and new areas of business,” he added.

He highlighted that such a tech outlook is the reason for increased spending on new trends such as digital twins, connected products, and solving some complex problems in healthcare and food.

Yardi said, in wave one, companies spent on the B2C (business-to-consumer) side of technology. “We saw a lot of aggregator or e-commerce economy, that's where the money was spent,” he added.

Wave one refers to one of the phases in which the company adopted new technology and ways of working while introducing automation and merged systems.

The next wave, Yardi believes, would attract spending into solving more complex operations and business problems.

The Capgemini chief added, "Companies are looking to monetise the data generated by deploying SMAC (social, mobile, analytics, cloud) technologies in wave one.”

Firms now continue to use analytics to arrive at the next big step action in terms of the right product to offer and the right place to optimise, Yardi said.