Competition is not bad

Last week I happened to overhear a very interesting conversation between some
of capital's most prominent partners. The topic was how to counter some of the
larger national players when bidding for contracts. The conversation was almost
entirely led by one of my dear friends-he shall go unnamed lest he get
offended-who wanted Delhi's leading partners to form a sort of cartel to
counter competition.

I must admit that I thoroughly enjoyed the conversation and at the same time
was also somewhat alarmed by their thought process. More than countering the
national players, the move has the potential to throttle competition. And when
you throttle competition, the biggest loser is the customer.

Let me just go back and explain the current situation. Traditionally, the
larger national players like HCL, Wipro, CMC etc used to focus primarily on
large corporates. While the smaller regional partners would get the SMB
customers. However, in the last two-three years, the situation has changed
dramatically.

Asim Raina Editor

While the number of large enterprises has just about inched up, the SMB
segment has just boomed. As a result, all the national players have shifted
their focus to this segment. This in turn has resulted in the regional partners
getting elbowed out. Interestingly, these local partners are not only losing out
in terms of name, they are at times being undercut by the national players in
pricing also.

All these years, the regional players were used to ruling the roost in the
SMB segment with hardly any competition. This meant that customers barely had
any choice and had to bear with whatever service was being given to them. Now,
with the advent of the national players, these very customers are seizing their
moment in the sun.

So, the current situation is extremely good for customers who get to choose
from a number of service providers. And the service providers are forced to
provide top quality service in order to retain them. Precisely for this reason,
I am totally against the idea of a cartel taking shape. There is no
justification whatsoever for its formation.

Essentially, the market forces should prevail and let the customer be the
judge. If you provide quality service at the right price point, he will be with
you for life. If not, then you will be amongst the also rans in the market.