In the last 10 years, Information Technology (IT) made a big boom in the Pakistan’s software industry.

With a number of internet service providers (ISP), software houses, ease of hardware purchases, and plans to establish IT parks in all major cities of the country, Pakistan is in the stream of new emerging technologies with other developing countries. But it all changed when New York was attacked, and with Pakistan’s other industries, its software market suffered too.

After 9/11 incident, worldwide software industry declined so quickly, but its impact on Pakistan was more severe than on other countries. The US, one of the major IT recruiters imposed heavy sanctions on all H1 visa applicants. Foreign collaborations for offshore development with Pakistan were terminated, and fresh graduates faced difficulties in getting job placements, the salary scale came down, and senior IT people became jobless due to downsizing or organizational restructuring.

This could be one of the reasons but not the main reason. The CEO of a Karachi-based software house discussed the problems being faced by the industry in a private interview. He emphasized that generally we are loosing our clients because India has more contacts in Western markets with the help of non-resident Indians (NRI) working in Western countries, availability of cheap IT labour force in India, experienced foreign returned IT consultants and available IT infrastructure in Banglore and Allahabad.

The government has also decided to invest in various fiscal and non-fiscal incentives to nurture, develop, and promote the use of IT in government organizations, to increase their efficiency and productivity. This will help in reviving software industry, both for local and foreign projects.

With unlicensed software (which is inexpensive to purchase) not only students but also some commercial software houses have explored all emerging technologies without heavy financial investments. It resulted in producing skilled and cheap labour for developed countries like United Kingdom and the United States. But some how it has left a very insignificant impact on the domestic market. In the local market, software development’s cost is still high, therefore local small business entrepreneurs are reluctant to automate their business processes, whereas corporate companies who have offshore businesses import hi-tech hardware and copyrighted software application from their parent organizations or franchises.

Pakistan’s software industry is still in its infancy and growth will continue to occur technically. But there is a need to make strong domestic market before making extensive plans for foreign market collaboration.

A number of companies have been working with foreign software houses but still Pakistan is far behind from its arch competitor India, which established its IT infrastructure for software exports in 70s. Banglore, Allahbad, Mysore, Manipal, Hubli, etc, became the Silicon Valley of India and now contribute highly in the India’s national exports.

Indian software exports had grown 37 per cent in the first six months of fiscal 1999-2000. Electronics and computer software export promotion council is now shifting to newly formed Information Technology Ministry that would help software exporters. This ministry will accelerate the implementation of government policies in a coordinated manner to achieve the national goal of $50 billion exports in IT by 2008.

In Pakistan, Karachi, Lahore and Islamabad have IT Parks established in the late 90s. There are some salient features of effective IT parks, some of which are outlined below:

* readily available world class IT infrastructure for telecommunication, internet service providers, hardware availability, inexpensive Network Solutions;

* ample specialized human resources both technical (programmers, system analyst, network administrator, database administrator etc.) and non-technical (project managers, quality assurance personals, business managers etc.);

* pleasant and comfortable office environment with consideration of ergonomics factors;

* cosmopolitan environment in the city where all basic and necessary facilities are available; and

* high concentration of IT companies and quality research and development institutions.

Worldwide software industry has strong liaison with academic/research institutions. In the development of domestic industry, the liaison plays an important role. Institutions conduct researches with the financial support from the industry and industry develops complete solution of their research.

There are at least six main areas in which worldwide software industry has been working. Integrated circuit design (IC), communication software, systems software, application software and service companies.

Indian IT industry’s composition alone in Bangalore indicates that a large percentage of the companies is involved in high technology software development like integrated circuit design (IC) 33 per cent, communication software 10 per cent, systems software 17 per cent, application software 17 per cent and service companies 23 per cent. In year 2000-01 the growth rate was 69.99 per cent in software exports where as in 2001-02 experienced a growth rate of 33 per cent.

In 1990-91, Banglore exported Rs50 million worth of software project. Between 1999 to 2002, the software exports were increased drastically.

Year No. of Rs. in crore

Companies

1999-2000 782 4400 (US $0.92bn)

2000-01 928 7475 (US $1.58 bn)

2001-02 938 9903 (US $2.06 bn)

These statistics show constant software export growth between 1999 to 2002 in India. While at the same time our industry was being downsized.

The growth reflects that contact with Western markets, available cheap IT labour force in India, experienced IT consultants and IT infrastructure are not the only reasons in growing software exports but the project management and quality assurance procedures are also vital to increase the exports.

The project management requires people who have capabilities to forecast future problem in the software project, capable to handle human resources or able to drive them towards the goal and confine the project within the budgets.

Although it seems more abstract but software exports also require effective software processes and practices. In the software industry, quality assurance department is responsible to review the software processes.

The capability maturity model (CMM) for software development is a framework that describes the key element of an effective software process. The CMM describes an evolutionary improvement path from an ad hoc, immature process to a mature, disciplined process.

The CMM has five levels. Initial, repeatable, defined, managed and the optimizing level. Organizations establish and improve the software processes by which they develop and maintain their software work products. They progress through these “levels of maturity”. Each maturity level provides a layer in the foundation for continuous process improvement. Each key process area comprises a set of goals that, when satisfied, stabilize an important component of the software process. Achieving each level of the maturity model institutionalizes a different component in the software process, resulting in an overall increase in the process capability of the organization.

Worldwide 52 companies have achieved SEI- CMM Level 5, where as in India there are 43 companies. It is very surprising that in Bangalore alone there are 20 companies with the SEI-CMM Level 5 status.

These statistics show that software exports are largely dependent on process capability of the organization and not only on the number of foreign projects acquired by the industry.

In Pakistan, few companies have been working since late 70s. But some how no company has ever reached CMM Level 5. Only few companies had achieved CMM Level 2 and were planning to go for CMM level 3 in 1997-1998. The current data is not available.

Conclusion: There is at least one frequently asked question, when our software industry will be able to increase its software exports? The answer is however difficult but there are few suggestions in this regard.

The software industry should build a strong liaison with academic institutions, to work on joint research projects for possible development of software packages. These research projects would help academicians to work on new problems and industries to develop new solutions to offer in the foreign market.

Software houses should participate in SEI-CMM levels certifications. This will not only provide them opportunity to be recognized in the international market but also to make their business processes effective. Their experiences should be well documented and white papers should be encouraged for the publications. Indeed there is a big competition in international market and we cannot compete with developed software industries if local software houses are reluctant to join their hands to capture the market.

Pakistan should encourage automation schemes in public sector organizations to enhance their performances and business process. Their patronage in local market would help the software industry to attract foreign collaborator for future project development in Pakistan. The initial investment could be high but eventually these automation schemes would bring profitable results in national income.

For successful implementation of projects, these schemes should be monitored by experienced IT consultants or IT boards presently setup in every province of Pakistan. In the IT boards, fresh graduates and junior IT professionals should be given chances on job so that they can learn project planning and issues involved in IT consultancy from senior IT professional. This will create a workable IT workforce that will take our industry to international level.

(Jawwad Kadir is CEO of Econ Vision and Regional Director, Zee Soft Inc. USA.)