Most Japan IT services vendors include business expansions in emerging markets within their growth strategies and are looking at strengthening operations by reorganising existing resources and establishing new offices and datacentres, according to a survey by IDC.
Japan user companies are rapidly expanding operations in emerging markets, which continue to achieve extraordinary growth, IDC adds.
As per it analysis, it will be crucial for Japan IT services vendors to take up mergers and acquisitions and alliances to quickly establish service delivery frameworks if they want to carve a nice for themselves in emerging markets.
Markets in emerging economies offer significantly higher rates of expansion than in Japan where low growth rates are forecast for the IT services market.
Many Japanese companies are already reportedly moving into the Chinese market and are looking to expand their operations in other parts of Asia, in addition to emerging markets in South America and Africa.
IDC Japan market analyst of IT Services Akiko Takei said they expect to see an increase in M&A and alliance-building activities by IT services vendors in emerging markets.
"Vendors will need to determine optimal M&A and alliance strategies after clarifying their target clientele and what that clientele requires," Takei said.
