homebusiness Newscompanies NewsWipro's Rishad Premji spots early 'green shoots' in 2024 amidst tech sector challenges
Wipro's Rishad Premji spots early 'green shoots' in 2024 amidst tech sector challenges
Speaking to CNBC-TV18’s Managing Editor Shereen Bhan on the sidelines of the World Economic Forum summit in Davos, Switzerland, Premji acknowledged the difficulties experienced in the tech services sector but highlighted the emergence of early "green shoots" in his company.
Rishad Premji, Executive Chairman of Wipro, expressed cautious optimism as he reflected on the challenges faced in 2023 and the potential for a brighter future in 2024. Speaking to CNBC-TV18’s Managing Editor Shereen Bhan on the sidelines of the World Economic Forum summit in Davos, Switzerland, Premji acknowledged the difficulties experienced in the tech services sector but highlighted the emergence of early "green shoots" in his company.
Premji noted, "It's been a tough year, the environment has been uncertain for tech services in general, I think it's been a bit harder for us as well, we have a larger consulting business and as a discretionary pool. But as I go into 2024, I'm feeling a lot better than I was feeling when I entered 2023."
Despite the ongoing uncertainties, Premji sees promising developments. He shared insights in the interview, indicating that discretionary spending, particularly in consulting, is showing early signs of momentum.
"Discretionary spend is always a key indicator of how momentum happens, and I see early signs of that. Consulting, to me, is a great spend, a discretionary spend area, and I see that—early green shoots," said Premji.
The executive emphasised that customers are transitioning from experimental phases to focusing on real business impact in 2024.
"I find that one of the notable shifts is that last year, customers dedicated a considerable amount of time to experimentation and proof-of-concept (POC) initiatives. We must have undertaken somewhere between 80 and 100 POCs. However, this year, there is a discernible shift as customers allocate more time to contemplating the real business impact of their initiatives as they enter 2024."
Addressing the broader business landscape, Premji acknowledged the fragility of the global economy, with uncertainties in Europe and geopolitical challenges across various regions.
"I believe the US is showing some improvement. Europe, on the other hand, remains uncertain from my perspective. So, we are navigating a delicate economic landscape with 60 countries entering election mode, adding another layer of uncertainty. Additionally, there is a backdrop of political and geopolitical conflicts, including an ongoing war that is still unfolding."
However, he believes that within these challenges lie opportunities, particularly in the realm of technology spend becoming more integral and central to customers.
"The opportunities are clearly in tech spend becoming more and more integral and central to customers, with customers recognising that they need to continue to invest," said Premji.
Discussing the focus on larger deals, Premji acknowledged a trend toward consolidation and cost-cutting. However, he remains hopeful that there are pockets of discretionary spending that could emerge, creating additional momentum in the latter part of the year.
"I'm still very hopeful that the areas of cloud, the areas of data and AI, the whole area of cybersecurity, where we investigate, the areas where I feel we are differentiating, and we will execute and deliver as we move into 2024," he stated.
Watch the video for the full interview
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