BY K.S. RADHAKRISHNAN
Nearly two decades ago, many U.S Corporations moved work mostly IT to India primarily for one reason – COST. It surely made sense, as it had a direct positive impact to the bottom line. While it is true to an extent even today, the reasons are not necessarily the same. In this global economy the success or failure of a company...
Nearly two decades ago, many U.S Corporations moved work mostly IT to India primarily for one reason – COST. It surely made sense, as it had a direct positive impact to the bottom line. While it is true to an extent even today, the reasons are not necessarily the same. In this global economy the success or failure of a company...
depend to a great extent on how well it takes advantage of the global eco-system. In this global eco-system, India has a unique place. While India has a huge intellectual capital, it has been plagued with poor infrastructure, complex bureaucracy and questionable business ethics. In spite of these negatives, many U.S and European companies have taken advantage of India’s vast intellectual resources for their benefits over the last two decades.
Having worked for large U.S and European companies for over 30 years and with direct involvement in large scale IT sourcing work in India, I am more bullish today than ever before for increased business engagements between Indian IT companies and U.S Corporations for one simple reason – “a business friendly government in India”.
Prime Minister Narendra Modi has promised a “Red Carpet” for foreign investors and at same time to address “Red Tape”, which had been a major source of frustrations for many U.S & European companies wanting to do business in India. The “Make in India” program launched in Sept 2104 by the Modi government is focused on transforming India into a global manufacturing hub.
The government’s focus to improve physical infrastructure and create a digital network to achieve that goal will need much deeper cooperation and participation of Indian and many other global companies. A series of investor friendly financial incentives announced by the government has already received tremendous interest from foreign governments and companies. However, these measures alone will not guarantee success. It is unclear if our Indian workforce is well equipped and ready to take advantage of these new initiatives.
In the IT outsourcing domain, India has earned probably the top place for doing “repetitive and mundane tasks”. By definition this kind of work has less strategic value to a US or European customer. While it has helped many Indians and Indian IT companies become more affluent, it surely has to an extent lowered their chances to compete for high-end technical work, where Russia took the top spot. It is especially true in the area of Material Science, complex Aerospace design & engineering, complex search algorithms etc. In this regard, India seems to have taken an easier route in the 1990s and early 2000s to get into the IT market.
Much credit has to be given to National Association of Software & Services Companies (NAASCOM) for shielding IT companies from government bureaucracy. NAASCOM’s help was much needed for many new entrants into this market segment. As a member of Boeing IT executive team, I had the pleasure of meeting with NAASCOM leaders more than a decade ago. Their advice was of immense help in setting our expectations right prior to making major out-sourcing commitments in India. They provided valuable information on overall landscape of IT industry in India, major players, their strengths and shortcomings. Particularly important to us was discussion on Indian educational system which helped us understand the overall skills of the IT employees.
Credit also goes to several entrepreneurs like Azim Premji (Wipro), Shiv Nadar (HCL), Narayana Murthy (InfoSys) and F.C. Kohli(TCS) among others who had the foresight and guts to enter into this market at an early stage and created a multi billion dollar industry. In fact they lead the crowded field with skill and fierce competitive spirit and earned a place for themselves.
During my career at Boeing as VP of global IT infrastructure, I had the privilege of working with most of them and with some of them very closely. One incident with Azim Premji is still green in my memory. I met with Azim in the Bay Area in 1996 for regular performance review of Wipro with Boeing. It was a one-on-one meeting.
What impressed me the most was the attention he paid to my views and recommendations for change that would make their service better. Honestly, I did not expect much from that meeting, as large companies are slow to act. To my pleasant surprise, he acted very quickly by implementing almost all my recommendations. The 9/11 incident, was surely a turning point - some of the Indian IT companies proactively reduced their hourly billing rates – sharing our pain. It was a class act of Partnership.
However, the global financial collapse in 2008 combined with geo-political changes, have given new dimension to the IT sourcing industry. While India’s position in the IT industry is strong, other nations like Russia, Eastern Europe, Philippines, Vietnam and China are getting into this market with vengeance and strong government support. For India to continue maintain its leadership in the IT sourcing industry it is imperative that it seriously addresses “Quality & Innovation” as part of the solution. While many Indian IT companies have made a good stride in the quality area, they are perceived less innovative compared to US, Russian and a few other European counterparts. While this perception may be debatable, one thing is sure – the students coming out of technical schools in India are less practical and less challenged during their schooling.
This is true primarily for the second and third tier colleges. For India to be a major force in this global economy, it must address the technical educational system with a sense of urgency. One of the major shortcomings I personally experienced years ago with Indian IT workers, is lack of practical knowledge in the domain they worked contrary to students educated in Europe or US. IITs and a few other schools may be an exception.
In order for Indian IT companies to maintain their position in this industry it is important that practical training, especially in the technical domain, become part of their education and made mandatory for Graduation. It is my belief that current government’s pro policies can help but it can not replace quality and innovation needed from our students.
Over the next several decades many more disruptive technologies will fundamentally change business models in almost all industrial segments. India should not only take full advantage of it, but also play a constructive role in driving these technologies. With focus, discipline, educational system modernization and national unity, I am convinced India can produce many more like Sathya Nadella (Microsoft), Sundar Pichai (Google) and be the driver of the global IT industry.
I am optimistic…….
(As former VP & CIO of Hughes Electronics Corporation and VP of Information Technology at Boeing prior to retirement, four years ago, Radhakrishnan had worked with several Indian and U.S. IT suppliers and consultants with mixed results.)
Having worked for large U.S and European companies for over 30 years and with direct involvement in large scale IT sourcing work in India, I am more bullish today than ever before for increased business engagements between Indian IT companies and U.S Corporations for one simple reason – “a business friendly government in India”.
Prime Minister Narendra Modi has promised a “Red Carpet” for foreign investors and at same time to address “Red Tape”, which had been a major source of frustrations for many U.S & European companies wanting to do business in India. The “Make in India” program launched in Sept 2104 by the Modi government is focused on transforming India into a global manufacturing hub.
The government’s focus to improve physical infrastructure and create a digital network to achieve that goal will need much deeper cooperation and participation of Indian and many other global companies. A series of investor friendly financial incentives announced by the government has already received tremendous interest from foreign governments and companies. However, these measures alone will not guarantee success. It is unclear if our Indian workforce is well equipped and ready to take advantage of these new initiatives.
In the IT outsourcing domain, India has earned probably the top place for doing “repetitive and mundane tasks”. By definition this kind of work has less strategic value to a US or European customer. While it has helped many Indians and Indian IT companies become more affluent, it surely has to an extent lowered their chances to compete for high-end technical work, where Russia took the top spot. It is especially true in the area of Material Science, complex Aerospace design & engineering, complex search algorithms etc. In this regard, India seems to have taken an easier route in the 1990s and early 2000s to get into the IT market.
Much credit has to be given to National Association of Software & Services Companies (NAASCOM) for shielding IT companies from government bureaucracy. NAASCOM’s help was much needed for many new entrants into this market segment. As a member of Boeing IT executive team, I had the pleasure of meeting with NAASCOM leaders more than a decade ago. Their advice was of immense help in setting our expectations right prior to making major out-sourcing commitments in India. They provided valuable information on overall landscape of IT industry in India, major players, their strengths and shortcomings. Particularly important to us was discussion on Indian educational system which helped us understand the overall skills of the IT employees.
Credit also goes to several entrepreneurs like Azim Premji (Wipro), Shiv Nadar (HCL), Narayana Murthy (InfoSys) and F.C. Kohli(TCS) among others who had the foresight and guts to enter into this market at an early stage and created a multi billion dollar industry. In fact they lead the crowded field with skill and fierce competitive spirit and earned a place for themselves.
During my career at Boeing as VP of global IT infrastructure, I had the privilege of working with most of them and with some of them very closely. One incident with Azim Premji is still green in my memory. I met with Azim in the Bay Area in 1996 for regular performance review of Wipro with Boeing. It was a one-on-one meeting.
What impressed me the most was the attention he paid to my views and recommendations for change that would make their service better. Honestly, I did not expect much from that meeting, as large companies are slow to act. To my pleasant surprise, he acted very quickly by implementing almost all my recommendations. The 9/11 incident, was surely a turning point - some of the Indian IT companies proactively reduced their hourly billing rates – sharing our pain. It was a class act of Partnership.
However, the global financial collapse in 2008 combined with geo-political changes, have given new dimension to the IT sourcing industry. While India’s position in the IT industry is strong, other nations like Russia, Eastern Europe, Philippines, Vietnam and China are getting into this market with vengeance and strong government support. For India to continue maintain its leadership in the IT sourcing industry it is imperative that it seriously addresses “Quality & Innovation” as part of the solution. While many Indian IT companies have made a good stride in the quality area, they are perceived less innovative compared to US, Russian and a few other European counterparts. While this perception may be debatable, one thing is sure – the students coming out of technical schools in India are less practical and less challenged during their schooling.
This is true primarily for the second and third tier colleges. For India to be a major force in this global economy, it must address the technical educational system with a sense of urgency. One of the major shortcomings I personally experienced years ago with Indian IT workers, is lack of practical knowledge in the domain they worked contrary to students educated in Europe or US. IITs and a few other schools may be an exception.
In order for Indian IT companies to maintain their position in this industry it is important that practical training, especially in the technical domain, become part of their education and made mandatory for Graduation. It is my belief that current government’s pro policies can help but it can not replace quality and innovation needed from our students.
Over the next several decades many more disruptive technologies will fundamentally change business models in almost all industrial segments. India should not only take full advantage of it, but also play a constructive role in driving these technologies. With focus, discipline, educational system modernization and national unity, I am convinced India can produce many more like Sathya Nadella (Microsoft), Sundar Pichai (Google) and be the driver of the global IT industry.
I am optimistic…….
(As former VP & CIO of Hughes Electronics Corporation and VP of Information Technology at Boeing prior to retirement, four years ago, Radhakrishnan had worked with several Indian and U.S. IT suppliers and consultants with mixed results.)
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