The big irony about India is it has produced tens of thousands of software engineers, but hardly any successful software or web services companies. The reasons are many – its successful services firms like TCS and Infosys invest heavily in recruiting and training armies and while they talk about non-linear growth (not tied to staff headcount growth) they do not invest much in building intellectual capital or in cloud capex. They offer young professionals a safe career path and a chance to explore the world. In contrast, the angel/VC ecosystem in India is nowhere near as robust as that in Silicon Valley to encourage software entrepreneurs. So, in some ways you could argue NASSCOM, the India trade body has a redundant S – it has always been much more about services than software.
And that is coming to a boil as this story in LiveMint suggests:
“If Nasscom has to stay relevant, it must collapse its “large-format”, five-star conferencing programmes, used successfully over the years with bigger member firms, and listen better to a small, but growing community of software product entrepreneurs who are dreaming to create India’s Google Inc. and Microsoft Corp.
These software product firms are led by a mix of veteran and newer maverick CEOs such as Sridhar Vembu of online office software maker Zoho Corp., who just don’t relate with anything Nasscom. Vembu spends time shuttling between his Silicon Valley office and Zoho’s development centre in Chennai all year. Unlike the software services business that’s used to multi-million dollar projects and large payrolls, software products require deeper engagements with fewer customers. And instead of broad-based industry lobbying, these firms need discussions around intellectual property apart from establishing links with potential customers in India and overseas.
So it was no surprise when last week that some 30 software product firms, including homegrown accounting software maker Tally Solutions Pvt. Ltd along with several product veterans such as former head of Yahoo Inc.’s R&D facility Sharad Sharma and InMobi founder Naveen Tewari, formed a separate forum called the Indian Software Product Industry Round Table, or iSpirt.”
This time of the year brings even more memories of the UK. I met Margaret during a posting in London in 1989. We go back often and Margaret took Tommy to the London Olympics and to Cambridge and Oxford this summer. We still get plenty of holiday cards from friends there and Margaret is very good about calling her cousins and friends for long holiday chats.
This year though I have noticed even more how the US and the UK keep drifting apart.
It is one of the few years where we have had both Thanksgiving and Christmas at home, and I noticed our Christmas dinner was a bit more elaborate than our Thanksgiving dinner. Margaret’s Irish/English upbringing at play where the Christmas turkey is the most important meal of the year.
I watch BBC and notice Boxing Day is still the most important shopping day in the UK. We have moved to Black Friday, Cyber Monday and who knows what else as days to splurge.
I watch CNN and notice how incensed Piers Morgan is on the gun control issue. Many Americans want to deport him, not realizing that most other Brits would bring a similar sense of pride at how their tighter gun controls work and ours do not.
I watch the movie Love Actually, a family favorite this time of the year and watch Hugh Grant as British Prime Minister stand up to a bully of Billy Bob Thornton as US President (a superbly lecherous cameo role).
Yes, the two countries still have a “special relationship” but we have been drifting apart for a while, and will drift apart more so as the US looks more West to the Pacific in the next few decades.
Through it all we still enjoy all the holiday cards, visits to London, and am particularly proud our kids have spent more time in the UK and Ireland than any other part of the world.
In Walter Isaacsonʼs biography of Steve Jobs, Isaacson describes the time that Jobs cold called Wendell Weeks, the CEO of Corning, Inc., to learn about Gorilla Glass (which is now used in more than 500 devices). Weeksʼ assistant refused to put him through, but offered to take a message. Jobs described that as “typical East Coast B.S.” In response, when Weeks returned the call, he was told by Apple’s receptionist to put his request in writing and to fax it.
The story ended well for both Apple and Corning, but it did highlight cultural differences between East Coast (and other) Fortune 500 companies and Silicon Valley.
At yesterday’s GE event, I saw several hints of that.
a) “Software is eating the world”
Chris Anderson of Wired asked Marc Andreessen on a panel to elaborate on the theme of his famous WSJ column, and Marc talked plenty of the Valley’s superb software capabilities . Jeff Immelt of GE said hardware, software, analytics and deep domain expertise are all important. And to emphasize hardware is far from dead, there was a giant, GEnx engine on stage (see photo of Tom Foremski at event – he is at least 6 ft and is dwarfed by it). Immelt looked at it with as much love as Steve Jobs used to when he showed off a new Apple device. With 20 sensors it can generate 1 TB of flight data a day. And Immelt talked about 250,000 intelligent pieces of hardware in other industries – scanners, turbines etc. Finally, he commented in his 30 year GE career, he has seen the world come full circle on the importance of manufacturing. The GEnx engine with its precision machining and material science advances are just one example of that.
b) Horizontal versus vertical
The Valley knows extremely well how to scale horizontally – it has given the world IT infrastructure, back office applications and plenty of other technologies which work well across industries. Immelt and the customers showcased yesterday (see this post) were all about verticalization. Deep domain knowledge with massive operational payback.
c) Investment Money versus Customer Revenue
Andreessen commented what a great job VCs have. They learn from portfolio companies and prospects all day long because “ we can write checks”. Immelt in appealing for Valley firms to come partner with GE, only casually mentioned an investment fund. But he repeatedly promised customer access – the opportunity to work on real life challenges in some of the most complex and demanding customers in the world. It reminded me of the expression I heard when I had my own startup: “Customer revenue is mother’s milk, VC money is sugared water”
d) My heroes have always been…
The Valley worships Jobs, Zuckerberg, Page, Ellison, Chambers – local company executives who have made it big. Immelt talked about peer Fortune 500 companies like Caterpillar which sell complex equipment. He could have also mentioned Siemens, Emerson, Deere, Komatsu and others who are also rolling out data intensive service offerings around their equipment.
e) It’s a small world after all
At various points during the day Immelt invoked Emirates Air, Etihad Airways, Qatar Airways and Korean companies in his comments. Apple, HP, other Valley companies are no global slouches, but few have the global intensity of GE. During a break I was talking to one of Immelt’s staff about his global travels. He has met with Putin, Cameron, Merkel, most other global leaders.
Watching the GE team in action yesterday, I was reminded of the late 49ers coach Bill Walsh springing his West Coast offense on the NFL. Only in reverse. The Valley has not seen much like Immelt and GE.
The Opening Ceremony with the Queen/James Bond skydive. Michael Phelps. The Jamaican sweep of the Men’s 200. British Cycling. US Ladies Soccer. Gabby Douglas. Misty and Kerri in beach volleyball. So much more. To me, London was the best Olympics ever.
It certainly was my most-watched. I probably spent a total of 10 hours on each of the previous Olympics. I spent considerably more time on the London Games. And used my time to watch lesser known events from lesser known places (e.g. Montenegro playing Water Polo).
The NBC web streaming helped. Baby sitting my beagle while the family was in Europe also helped. But most of all, I was dazzled with all the technology and innovation I could catalog on the New Florence blog.
Take a quick glance at the 30 posts – lots of interesting nuggets whether you think they were the best Games or not.
Brent Rose at Gizmodo summarizes the anger many of my tech savvy colleagues feel about NBC for its delayed broadcast of many of the Olympics events (there is a hilarious Twitter account @NBCDelayed which has been tweeting world events years and decades after they happened to make the point).
I am in contrast, a pig in mud, with my cable account-enabled access to the NBC Olympics site. I can go look at any of the 302 medal events, live or archived.
I am being guided by 3 principles beyond the must-see USA Basketball, Phelps/Lockte/Franklin events
a) Spend a few minutes on every sport
I hope to see spend a little time on each of the 32 sports (NBC’s definition which is slightly different from that of the IOC). My family, while athletically not Olympic quality by a long shot, has played in 15 of the sports. The kids have fenced, rowed, played Taekwondo. I have played table tennis and badminton. It is fascinating to see the best athletes in each sport.
b) Expand my geography
My family has traveled to over 60 countries. I am the big contributor with 51 countries on my passports and I am embarrassed that’s only a quarter of the 204 countries at the Games. If I can vicariously enjoy a trip to Montenegro or Kazakhstan through their athletes, so much the better.
c) Explore how technology has evolved each sport
I had to do a double take when I saw a field hockey game. From what I remember the turf was natural and green, not blue astroturf. The ball was white, not yellow. The goalie did not have baseball size gloves. I am fascinated with the “fast pool” at the London aquatic center – how much design elegance and technology it incorporates and blogged about it on New Florence. I see the 5 and 2 meter light beams which have replaced the traditional cones in water polo, and I go Googling for more information on the technology.
My wife and son got to go the Aquatic Center in person for the Saturday swimming heats. I was jealous for a total of 5 minutes. Then I went back to thanking NBC for expanding my horizons in so many dimensions.
This blog loves disruptive technologies and vendors. They tend to be unpredictable, break the mold. And we love the British with all their eccentricities. And I mean that in an affectionate way.
When I arrived in London for a “tour in duty” in 1988, an American technology executive who hosted events all over Europe told me “When we open the buffet in Paris or Rome, chaos breaks out. In the UK, they queue up even if the line is an hour long”. That evening, a bunch of British football fans caused chaos at a stadium away from home. Yes, the country is full of contradictions and they are on full display at the Olympics.
Take the Queen/James Bond segment at the Opening Ceremony . The Queen barely acknowledged 007 – only us commoners go ga-ga over a civil servant. Yet she allowed a stunt double to skydive for her into the Stadium. Royal Protocol? Yeah, try that for her darling Corgis who also starred in the segment.
Or try to keep Rowan Atkinson in line as he buffooned his way through the iconic British theme from Chariots of Fire.
Take the Cauldron. The designer, Thomas Heatherwick, was told “no moving parts” presumably given the inherent risk of fire in a crowded stadium. Instead he designed one of the most complex, eye popping ones ever.
In a time when socialized medicine is heatedly debated, Danny Boyle’s production proudly celebrated the UK National Health Service.
The production, magnificent in its display of British dominance during the Industrial Revolution, skirted with Are you kidding me? as it moved to Britain during the Digital Age (in spite of Tim Berners-Lee who was honored). Fortunately, it focused more on British music from Freddie Mercury to Paul McCartney.
It is a country never sure about multi-culturalism, yet Heathrow, any given morning has more exotic tails on aircraft than any other airport in the world. London also has a mayor named Boris. So it was good to see Danny sprinkle immigrants throughout the production
And yet the country keeps its own sense of what is “propah”. US Swimmer Ryan Lochte almost forfeited his Gold Medal for wearing dental bling at the award podium.
Ah, Great Britain. Keep on surprising! We love disruptive behavior.
I picked up Time and BusinessWeek in the mailbox yesterday and they both had unflattering China covers with words like lies and corruption. With our elections and their leadership transition coming up, Chen Guangcheng and Bo Xilai will be household names on both sides of the Pacific this summer. There are some entities – companies like Monsanto, and countries like China - that even the best PR firms cannot help much.
In all that negative talk, I was struck by this comment in the Fareed Zakaria column in Time:
A party whose history is tied to peasants, workers and soldiers is now the most elitist operation in the world. Its system of promotion favors engineers, economists and management experts over anyone with grassroots political skills. For two decades, China has been run like a company, not a country.
Blame the Chinese leadership for many things, but give them credit for the amazing technocracy that I researched for many parts of my new book
a) Why has Apple, so smart and ruthless in so many ways, put so many of its eggs in the China assembly basket (most components come from Japan, Korea, US etc) ? Largely because its contract manufacturer, Foxconn has delivered time and time, product after product, revised demand forecast after another. If any other outsourcer – IBM, Jabil, Accenture, Indian - is salivating about China’s image problems, this is an opportunity to step up and deliver to those cost, quality, time to market metrics. I highly doubt any of them can come anywhere close.
b) It goes beyond labor these days. BusinessWeek had a column on the growing SUV market in China. As Tony Prophet of HP is quoted in the book:
“We have been in China over two decades, and like other Western companies we could see the spiraling real estate costs, employee absenteeism, stretched infrastructure in the developed East and South. Starting in 2007 we started to evaluate alternatives like Vietnam and Malaysia. But the more we looked at Western China, the more we also saw the opportunity for the domestic market. If you draw a circle out 750 miles from Chongqing, you are looking at about 300 million people—which by itself makes it one of the largest PC and other gadget markets in the world. So that is our first focus here in the west of the country—made in China, for China.”
c) It goes way beyond Apple and HP – way beyond them. The country’s regional niches described in my book show its breadth and the global business it has attracted:
“It could be to Juijang on the southern shores of the Yangtze River with visits to the solar photovoltaic manufacturer Sornid and the helicopter manufacturer Red Eagle. Another trip could be to Qingdao (better known to many in the West as Tsingtao—as in the beer), host to Haier Group, one of the world’s largest home appliance manufacturers, and GERB, which focuses on vibration control in heavy machinery, equipment, structures, and trackbeds. Perhaps it could be to Xiamen on the southeastern Chinese coast where Dell has a factory for the booming local China market as does Philips Lighting Electronics, which is focused on next gen LED and other lighting. Or it could be to Chengdu in western China, home to Intel assembly and testing facilities, and to Giant, the largest bicycle manufacturer in the world.”
Time, BusinessWeek and plenty of others are right to point a bunch of challenges for China, but let’s not forget the manufacturing dynamo and massive market the Chinese leadership has built. It ain’t going away no matter what names we call the country.
This weekend between Ray Wang’s problems with United Airlines and Dennis Howlett’s irritations with British Airways on his way back from Australia, a set of Twitter and other conversations ensued which drew comparisons to Singapore Air, Emirates Air and other well-run international carriers. And it hit me how regulators everywhere still protect airlines from foreign competition. There are complex “third country operators” rules around the world and terminology like fifth and eighth freedom rights.
If that is protected, look at healthcare. Recently Fareed Zakaria on his CNN show and his Time column showcased universal healthcare in places like Switzerland and Taiwan. Most friends I have talked to refuse to acknowledge the US healthcare system is even broken. And if the Supreme Court strikes down key provisions of Obamacare, the conversation about health care reform will be muted – again – for several years even in the face of growing global benchmarks.
In other industries, business executives will use the “our country is so different” excuse. Talk to any telecom executive about bandwidth and cost in Japan or S. Korea, and they will brush it off as “the US is so much larger in area”. Yes, but our cities are not, so why not compare major cities?
Banking, Education – I could go on about how much all our global horizons have expanded in the last few years.
It’s almost like two universes. The flat world in which global benchmarks are increasingly available to consumers and citizens, and the rocky world where politicians, unions, and executives hide in their caves and try to keep convincing us to accept what we are being dished out.