A three-stage model to overcome the challenges faced by Indian software small & amp; medium enterprises (SMEs)

Abstract

Recent research has shown that small and medium software enterprises (SMEs) are a very important cog in the gears of the world economy and comprise of about 99.2% of the companies in the world. In India, about 98% software companies are SMEs. Most of them are the start-ups or stragglers who don't even qualify for venture capitalist funds or policies implemented for SMEs. A very few are the survivors with medium manpower, infrastructure and finances. So, as a result, the larger Indian companies are growing even larger, while the smaller companies are being increasingly wiped out. A survey of about 150 SMEs was conducted, 20 project managers and 60 programmers were interviewed to identify the technical and business problems faced by the Software SMEs in the Indian sector. In this paper, we discuss the major challenges faced by them and propose a three-stage model as a solution. The model proposed will help the SMEs to survive in the competitive market and help them to challenge the market leaders.