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Wednesday, September 26, 2007

The Changing Trends

The CIO Magazine shootout on offshore services finds India more attractive as an offshore destination than China. Yet another survey echoed similar sentiments. For me beyond a point location does not matter- it is only people, process and program management that matter – I guess the survey’s conclusion in some forms has been influenced by these factors as well.

A survey by Capgemini and ProLogis, a global leader in industrial real estate, suggests that India could challenge the position of China as the manufacturing center of the world in the next three to five years.

Today China is the preferred location for offshoring manufacturing activities while India has been the preferred location for IT, finance and customer service. On the other hand, companies are planning to offshore manufacturing activities primarily to India, over the next 3 to 5 years. One key factor noted in the study is that some of the main manufacturing locations in China are becoming too expensive relative to other countries in the region, which includes India.The study also reveals, offshoring activities to China and India has had limited impact on the corresponding Western operations. Any more switch would happen only when the transition pain becomes lesser than sustenace pain.By looking at the overall average of the activities, the closure rates of the corresponding Western facilities is about 10% and the percentages varied significantly between China and India and are dependent upon individual activities.

Well after all offshoring business is not a zero sum game and growth and volumes makes any comparison a subjective/contextual exercise but clearly growth of the offshoring business is becoming more and more of a centerpiece in every growing business and it is a win-win for all the players.

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Monday, September 24, 2007

Competition @ Internet Speed

Mark Cuban recently wrote, The Internet is dead and boring, while no doubt the underlying technologies of the web are are in a stable mode and unlikely to radically change in the near future. While we ait for http 3 or IPVx, the world ought to realise that a lot of additional value can come out of what we currently loosely define as the internet platforms. Some of them are the the modern wonders of the world/Marc Andreesen recently wrote about the internet platforms.

Umair picks up issues with facebook, the hottest name in the internet today.He argues that Facebook/F8 - is not a platform and the worldwide web is the platform - and every site or widget on it is also an open platform. His reasoning:

In yesterday's platform economy, scale in complements + technological specificity drove huge switching costs. But today, there is no hard technological lock-in - and it's very, very hard to create it. Let's say we create a closed standard. And we gain demand-side scale. He sees that Facebook has built a pseudo-platform. He is right that such platforms create no real entry barriers and switching costs can’t limit entry. As if taking the cue, Techcrunch
points out that facebook has a platform to allow third parties to build applications on Facebook itself. But what Google may be planning is significantly more open - allowing third parties to both push and pull data, into and out of Google and non-Google applications. The internet economy is indeed amazing.

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Sunday, September 23, 2007

Managers & Meaningful Recognition

Just came across this nice piece.Harvard Business Online has executive coach Marshall Goldsmith respond to the query - How Do I Provide Meaningful Recognition?
Marshall outlines the following
1. List the names of the key groups of people that impact your life -- both at work and at home (customers, co-workers, friends, family members, etc.).
2. Write down the names of the people in each group.
3. Post your list in a place you can't miss seeing regularly.
4. Twice a week - once on Wednesday, once on Friday -- review the list and ask yourself, “Did anyone on this list do something that I should recognize?”
5. If someone did, stop by to say "thank you," make a quick phone call, leave a voice mail, send an email, or jot down a note.
6. Don’t do anything that takes up too much time. This process needs to be time-efficient or you won’t stick with it.
7. If no one on the list did anything that you believe should be recognized, don’t say anything. You don’t want to be a hypocrite or a phony. No recognition is better than recognition that you don’t really mean.
8. Stick with the process. You won’t see much impact in a week – but you will see a huge difference in a year.

Many business leaders do not get the time to give feedback in time. Jack Welch once said that any decision about firing/role change of GE operational executives were never a big surprise as objective periodic feedback was a given thing as regular feedback was the norm therein. Communication – that too timely & frequent is the norm of modern organizational norm and executives jolly well do that.



Thursday, September 20, 2007

Innovative Models In Value Creation In IT Services

Not many know about the way the india headquartered companies manage to grow so fast and yet remain so consistent in their execution. Ramalinga Raju, Founder & Chairman of Satyam computer services has this to say on this topic in an interview published in the Mckinsey Quarterly. Excerpts :

The development of an innovative business model early on played a vital role in the company’s success. Among other benefits, the framework helped sustain an entrepreneurial spirit, distributed leadership roles throughout the organization, and created an environment focused on “delighting” stakeholders. Traditional hierarchical models will not be effective in a knowledge industry. Rather than focusing the whole business on delivering value in one way,at Satyam value was being delivered in many different ways, depending on the services our clients needed. To cater to these differences, we created an organizational design that distributed leadership more uniformly. Ownership of results shifted to leaders who were closest to the relevant stakeholders, which could be their colleagues, investors, clients, or even society generally. The rest of the organization supported these leaders from behind the scenes, helping to create a “One-Satyam” experience for the stakeholder. This design also sought to bring the correct balance between building the right soft assets that have lasting value and delivering reliable results for stakeholders.

He adds that the most distinctive aspect of the business model that you have adopted is that value creation follows a similar structure irrespective of industry, type of function, or level within an organization. that sense it is analogous to fractals in science and mathematics. Not to get too esoteric; fractals are self-replicating constructs that become increasingly small, like the sections of a seashell or the buds in a stalk of broccoli. While they are similar, they are not necessarily identical. You can look at a business in the same way and try to find a pattern for value creation, an essential DNA that repeats itself in every area and at every level. So we started looking for the smallest reasonable construct in our business that repeats itself. This construct had to deliver value to someone—a client, an internal customer, some other stakeholder—but it also had to be large enough to stand alone. In theory you can take the idea of fractals to the extreme, but in business if this construct gets too small, it consumes more organizational resources to manage than would be justified by the value it creates. We consider ourselves in the business of building leaders. The most effective way of realizing our goals and objectives is to grow leaders faster than the competition.

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Jumpstarting Innovation : Making Innovation Commonplace

There is an interesting article/working paper in Harvard Business School’s Working Knowledge - Jumpstarting Innovation: Using Disruption to Your Advantage by Lynda Applegate:

Disruptions in the business environment cause economic shifts that destabilize industries, companies, and even countries. They allow new entrants or forward-thinking established players to introduce innovations—in products, markets, or processes—that transform the way companies do business and consumers behave.
Mature companies understand that to compete today they need to innovate. But finding sources of innovation while still paying attention to the current business can be a struggle. The good news, says Harvard Business School professor Lynda M. Applegate, is that one of the forces that threatens established companies can also be a source of salvation: disruptive change.
This excerpt from a recent presentation encourages executives to leverage disruptive change as a platform for innovation.
Fostering innovation in a mature company can often seem like a swim upstream—the needs of the existing business often overwhelm attempts to create something new. Lynda M. Applegate argues that one of the forces that threatens business can also be the source of a major change : disruptive innovation. She continues that disruptive changes that might serve as the source of innovation include technology shifts, new business models, industry dynamics, global opportunities, and regulatory changes.

Just as they say that business is like running a treadmill, disruptive innovations need not be just novel inventions. Successful innovators take ideas and turn them into opportunities by adding a business model that creates sustainable economic value for all stakeholders. They then go one step further and exploit the opportunity by creating a sustainable business. Together with business model innovation , disruptive innovation can be the harbinger of making innovation the dominant mantra for growth, success and in some cases for survival

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Monday, September 17, 2007

Yahoo Buys Zimbra

Yahoo buys Zimbra. I heard Zimbra present in the Enterprise 2006 event and found them impressive. This is a noteworthy acquisition. With this yahoo gears to get in race with Google for the next generation online/offline office suite, represented as Google Gears. Zimbra had some six million users as of May. Yahoo Mail has more than 250 million.
Zimbra currently offers open source e-mail, calendaring, and contact management solutions that can be used both on- and offline, and services small businesses and educational institutions. Zimbra’s widges named "Zimlets," tie information from other web services into Zimbra's suite. The Zimlets essentially act as widgets that can be customized and placed around Zimbra's e-mail or calendar tools so that users can access information quickly and conveniently.Zimbra believes that Yahoo's broad reach with its advertising and content network, combined with Zimlets, will make for a nice pairing. May be Zoho is next in line to be acquired. That would take them head-on with google docs.
Read the Yahoo press release and Zimbra CEO Satish Dharmaraj’s blog post on the acquisition. And here’s the Yahoo official blog post .


The Maturing Internet Platform Conundrum

Mark Cuban recently wrote, The Internet is dead and boring, while no doubt the underlying technologies of the web are are in a stable mode and unlikely to radically change in the near future. While we ait for http 3 or IPVx, the world ought to realise that a lot of additional value can come out of what we currently loosely define as the internet platforms. Some of them are the the modern wonders of the world

This is an excellent piece coming as it is from Marc Andreessen: The three kinds of platforms you meet on the Internet. The platforms of the future will be online services that you will tap into over the Internet, perhaps with nothing more running locally than a browser. They won't have anything you download, or even an SDK. They will look more like services than software .
Unlike the enterprise system with allows at best extension through API’s, internet platforms are more amenable. Here comes the gradation( level 1 to above they are harder to build but easier for the developer:
Level 1 is typically a platform provided in the form of a web services API - which will typically be accessed using an access protocol such as REST or SOAP.

Level 2 apps historically has been used in end-user applications to let developers build new functions that can be injected, or "plug in", to the core system and its user interface- Photoshop, Facebook fall into this category. The technical expertise and financial resources required of a Level 2 platform's developer intending to build a meaningful app - are very high.

In a Level 3 platform, the huge difference is that the third-party application code actually runs inside the platform - developer code is uploaded and runs online, inside the core system. The platform itself handles everything required to run your application on your behalf. The level of technical expertise required of someone to develop on your platform drops by at least 90%, and the level of money they need drops to $0. Which opens up development to a universe of people for whom developing on a Level 2 or Level 1 platform is prohibitively difficult or expensive. Level 3 platforms are "develop in the browser" - or, more properly, "develop in the cloud".

And which companies are working on Level 3 platforms, besides Marc's Ning?
• Salesforce.com
• SecondLife
• Amazon (through AWS)
• Akamai

For the avid value digger, the advice is to look for the new applications that a new platform makes possible. In the long run, all credible large-scale Internet companies will provide Level 3 platforms. Those that don't won't be competitive with those that do, because those that do will give their users the ability to so easily customize and program as to unleash supernovas of creativity.

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Monday, September 03, 2007

Cloud Computing & The Potential Game Changer

John Markoff reports that Microsoft is prepared to release it's software "suite" this week:
It plans to turn that strategy upside down, making available free software that connects its Windows operating system to software services delivered on the Internet, a practice increasingly referred to as “cloud” computing. The initiative is part of an effort to connect Windows more seamlessly to a growing array of Internet services. He says that this is an effort to connect the Windows OS with software services delivered via the cloud - and this is similar to Microsoft embedding Internet Explorer to Windows , a move that invited anti-trust allegations.
Available indications suggest that the e software release will offer PC users the option of downloading a set of the services with a single Unified Installer program, or as separate components. The individual services are Windows Live Photo Gallery, Windows Live Mail, Windows Live Messenger 8.5 and Windows Live OneCare Family Safety, a computer security program. Not much details are provided beyond what’s actually in the download, but to me it looks to be a direct, and an albeit belated response to Google’s challenges. Recently, Google launched an unified cloud storage for Gmail & Picasa. It is speculated that Microsoft may come with a direct competitor to this but probably we may have to wait for some time for this to be unveiled. This is no doubt an interesting development in the desktop market, in my view the larger opportunity may lie in what John Markoff earlier pointed out, "an obvious market opportunity" in the portable computing market: a lightweight, thin-client, ultralight laptop that draws its data and applications off the Internet. Microsoft would get worried the day when someone comes with a scalable business to support, an economical, simple to use , lightweight portable with a browser, a wi-fi card and with some good amount of flash memory. Productivuty suites running this way may eventually turn out to be the army that may eclipse Microsoft, if not run over it.

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