Apart from doing software / web development on Open-source platform, Indus Net Technologies also customize and implement open-source products for clients on demand. Some popular (and free) open-source products are SugarCRM, Drupal, osCommerce for CRM, content management and e-commerce respectively.

IMHO, these are some limitations that I have observed. It is important to know them before initiating a project. These are not very serious in nature and using free open-source products remains a good option for many small and medium sized enterprises around the world.

1. Like any product, it is very important to align the product with your workflow and/or requirements. You must fit the product into the organization by making necessary changes. Therefore a gap analysis should be done and the effort must be estimated for aligning the product as per the current work-flow and/or requirements.

2. Most free open-source products lacks in usability. Therefore if you are doing a major implementation which will be used by thousands of people and you are going to pay for their time, you must consider a major overhaul of interface by involving a usability consultant from your vendor. Otherwise you will end up spending a lot of money.

3. Most free open-source products have very poor reporting system. These reports are not good enough to run a business and shall be re-done as per your company requirement aligned with your key measurement matrix for the given business function.

4. The programmers who can change the software as per your needs are the code-hackers types, who love to dive into existing system architecture and make small changes to achieve the desired results. Therefore you must identify and hook up with the right programmer / programming company (like Indus Net Technologies - a bit of shameless self promotion) to get it right.

5. It is a myth, that implementing open-source software is free. Software code is free, not the hard work of programmers and analysts which goes behind implementing it. And you need the later to successfully implement it in your scenario and reap the benefits of the solution. Yes, it considerably reduces the cost, improves reliability and gives you a head start from where you can take informed decision about your IT needs.

Do not get me wrong. I am only listing the limitations. The benefits are well-known and they out-live the limitations any day. However it is very important that these limitations are known before proceeding.

Feel free to discuss / debate!

Offshore outsourcing - a concept that made IT & India synonmous with each other in the first decade of 21st century is loosing its glamour quotient consistently. It seems that by 2010, hundreds of software companies will run out of steam as they loose their competitiveness in the ever changing industry, since their business model has been worked around cost arbitrage alone.

Some hard facts which makes me feel so:

Increasing wages in India: Salaries are constantly moving skyward. Every year IT companies are forced to raise wages by 20-25% to remain competitive in the job market. Some hot IT destinations in India have become as expensive as Australia and Canada (if not USA and UK) in terms of manpower costs. With advent of offshore facilities of US / Europe based software companies, the trend will continue to move north.

Shortage of skilled manpower: Indian IT industry is facing a major shortage of employable skilled manpower. The education system has not gone through any fundamental improvement to fulfill the ever growing demand of the industry. Large companies are hiring semi-skilled and non-skilled professionals (not really) to fill in the positions that exists in their team. This is continually detoriating the quality and quantity of work that gets done resulting an increase in effective cost of production for the customer. At one point of time or other, this will pinch and will make offshore outsourcing non-competitive.

Appreciating rupee, depreciating dollar: With the economic upswing, the rupee is scaling new heights. On the other hand, due to economic slowdown in sight, US dollar is declining heavily. This is resulting in direct losses of revenue for most offshore outsourcing companies. There has been a 10-14% decline in revenues just because of currency appreciation. This is a net loss to the company since the effort / cost of servicing the client remains the same.

Increasing operational expenses: Cost of doing business is on a rise with zooming real estate prices, increasing fuel prices and towering living expenses. Companies are forced to spend a lot of money in the x-factor to impress prospective employees. All these put together are increasing the operational expenses and overheads for offshore outsourcing companies. In fact inflation is heading towards 10%, which is not making things better.

Companies are adpoting global-sourcing: Large enterprises in USA / Europe which were dependent on offshore outsourcing till date are now aggressively adopting global-sourcing. Many of these companies are directly setting up their software development centers in India (or a competitive location), resulting in a dent in the revenues of offshore outsourcing companies who used to serve them. The trend towards captive offshore development delivery will only increase in years to come.

New destinations: Several new offshore outsourcing destinations are coming up including China, Brazil, Ukrain, Ireland, Poland, South Africa and Russia. Many of them do not rank close to India in terms of the combo-punch of english educated, logically strong, hard working Indian IT worker. But they are making

But as it is said, when the going gets tough, the tough gets going. I am sure many companies will evolve their business models, move up the value chain and give customers more than one way to outsource to them!

Afterall the outsourcing story has just begun! 

• The SEZ Act is under constant change. So whatever is stated there cannot be taken as a confirmed policy from the Government.
• The Act has been poorly and loosely drafted leaving a lot of ambiguity, areas of misinterpretation and scope of misuse by people who have the best lawyers at their disposal.

1. Manufacturing or service companies - They will get duty-free import capability and relief from various direct and indirect taxes including VAT, Service Tax, Excise Tax, FBT, Dividend Distribution Tax and above all Income Tax. These sops are given so that these businesses invest for setting up new infrastructure and in their business within the SEZ marked area.
2. Real estate companies - They will develop the SEZ infrastructure and multiply the value of land literally overnight and reap rich dividends.

• SEZ scheme is mainly helping large, established businesses and is working against small and medium sized businesses. Large companies like Reliance, Infosys, Mahindra, etc. who can buy and build infrastructure measuring 25 acres or more will reap the benefit of tax exemption for another 15 years, while small companies will struggle with a collective tax burden of more than 50% of the total turnover. Big will become bigger, small will have a tougher time and perish.
• SEZ scheme is brining back (in a new package) the age old zamindari system. The SEZs which are being developed by real estate developers to accommodate medium sized companies are leasing out infrastructure at abnormally high costs (almost five times of normal rent) which makes it out of bounds for most entrepreneurs. There is no regulation on the ownership / lease / rent process between these real estate developers and the SEZ units. In one of the agreement that I have managed to get my hands on, the SEZ developer made a mix of Deed of Assignment and A Sub-lease Agreement keeping best of both worlds in his own favor and charging a price which a Freehold Land. Few companies, who will manage to afford it, will end up spending a major of their cash flow on rent/lease cost alone. This will make them highly vulnerable to cyclic depressions in the market which are very common on a new industry.

• We do not mind paying taxes. If IT industry should do away with subsidies, Let everyone pay taxes! There should not be double standards by retaining tax benefits for large established players and punishing small & medium sized enterprises for being what they are - i.e. small.
• Please come out of the dream that infrastructure creation is fundamental to IT growth. IT is not like heavy engineering, steel or shipping business which depends heavily on top-quality infrastructure. In fact IT infrastructure has the highest depreciation and technologies / equipments get obsolete overnight. The largest companies in Silicon Valley have come out of garages and dorms. IT industry needs entrepreneurs and people for its growth. Focus on growing talent in colleges and universities. 
• IT industry has low entry barriers. Try to keep it low. This will help innovativeness and constant evolution of the industry. Let entrepreneurs take control and scale new heights. Facilitate them, don’t frustrate them.

I was recently speaking on "Myths & Facts of Entrepreneurship" in Entrepreneurship Summit 2007 at IIT Kharagpur (KGP) on behalf of NEN. Overall, the event was nice, but it made me think over few points.

1. Can we really teach entrepreneurship?

Entrepreneurship, as I see is,

• An instinct,
• An attitude to create something new,
• An activity which creates value in the entire social eco-system, 
• A creative expression of interest in solving problems around us 

Till date, I am yet to meet an entrepreneur who has been taught about this subject in a formal setting, and that he has actually gone out and done it, and made it successful. It is a state of mind, which develops naturally, based on his surrounding and experiences, which makes him think about life and career in a given way.

Such events (like Entrepreneurship Summit) can inspire someone to be an entrepreneur, make a person desire to start a venture, but I am not sure if it can create the state of mind.

2. In many cases, I have seen that entrepreneurship is not be plan. It is by destiny. There are hundreds of people who were pushed to the wall and were left with no choice to take on the world all by themselves. They rose up to the occasion and did what it takes to survive. Today we call them successful entrepreneurs. This again emphasize that entrepreneurship is a state of mind that is there or emerges under given circumstances - mostly adverse situations.

3. Most wanna-be entrepreneurs start off with a business plan which predicts his revenues, profits, break-even point and growth trajectory. If you see most successful entrepreneurs, they never planned, they dreamt. They created value and chased their dream. The dream was not the riches that entrepreneurship can bring, but a dream to dominate / be successful in a given domain and create value that can change the world. They want to lead. 

For example, Bill Gates never planned to become the "richest person on the planet" through Microsoft. He dreamt of a PC on every desktop in the world! He worked hard to make his dream come true and reaped the rewards in form of the riches that he got in the process as a result.

Wealth is a by-product of entrepreneurship, not the destination.

So, the question again comes - Can you teach someone to lead, dream, continuously innovate, rough-it-out and fight back. I think - NO. You can only motivate someone to do so.

Your comments are welcome to debate my point of view!

Hello Friends,

I will be visiting London from 13th October till 23rd October for some business meetings.

If you -

• are an existing client of Indus Net Technologies (or any of our service brand) OR
• are a business considering outsourcing your web design, web development or Internet marketing business OR
• just want to meet up for a friendly 1-2-1 meeting

Please drop me a line at talash@indusnet.co.in and we will meet up!

Abhishek

I think online networking is the best thing that has happened on Internet in last few years. I see several benefits of networking and spending time to meet new people and build professional and personal relationships.

• You can make new friends in new places.
• Someone might be of great help to you in a given situation. You never know.
• If someone cannot help, they might know someone who can help. They can simply connect you to the right person.
• You might get references for business and professional engagements if you can build a trust relationship and prove your expertise. We all know that word-of-mouth publicity is the best advertising. It is most influential and cost almost nothing. Most of the times networking is the only way to reach a particular person to discuss a proposal.
• You can get feedback on your idea, plan or work from different people with different point of views.
• You learn by sharing knowledge and experience. This can be done on a 1-2-1 basis or in a knowledge forum where people with same interest can discuss on a given topic.
• You can create mastermind groups where members discuss individual problems and help each other achieve their goals.
• You can help others. It is a great feeling to be of help to others. It makes you feel purposeful.

I have seen several online social networking websites. The ones which I liked the most are:

• Ecademy (No doubt the best business social networking website on Internet)
• LinkedIn (A great fan following and very good selection of people to connect to)
• Facebook (Looks like a decent social networking website - I really do not have much experience on this platform to make a firm comment)

BTW, I keep traveling between Kolkata, Chennai and London for business and will love to meet people who feel that I can be of help to them. Please write me a small note with your area of interest and I will get back to you.

May you have a million connections!

Abhishek

Department of Information Technology, Government of West Bengal (www.itwb.org) is doing a remarkable work in supporting and nurturing IT industry in the state of West Bengal. Their investor-friendly approach and innovative action-oriented leadership has changed West Bengal over last five years. I am fortunate to be doing business in this state in such exciting times!

They have put up their vision as:

• To Rank among top-3 IT States of India by 2010
• Contribute 15% - 20% of the country’s total IT revenues
• Create leadership position in executing high value-added IT work - developed through intellectual leadership and supported by Government initiatives

Their solid track record might just enable them to pull up and meet these targets. However, I seriously doubt that this position can be achieved and / or sustainable in long term. There are two core issues, which if not checked immediately will result in serious decline in the position that has been created with the initial efforts.

1. The poor quality of education
2. Indifferent attitude towards homegrown small and medium sized IT companies

Poor quality of education

Knowledge industry needs top quality human resource that are well educated, thoroughly knowledgeable and well groomed. Unfortunately our education system is inadequate and we are not creating employable talent.

• IT education has become a low paid job and is mostly taken up by individuals who are unable to make it to the professional ranks in IT companies.
• The education system is still based on text-books and spoon-fed course materials. Reading outside the prescribed text-books is hardly encouraged and/or practiced. This has resulted in a huge pool of IT resource pool with no individuality and poor problem solving capabilities.
• Quality education has become privilege of an elite few who go to the top ranking institutions and comprise less than 1% of the total resource pool. It is unfortunate that most of these individuals decide to join companies outside India for better pay-packages draining away one-million-per-student from taxpayers money!
• IT education has been limited to "programming"! I have spoken to thousands of It graduates and they have no idea that there are career opportunities in fields like testing, publishing, project management, etc.
• Current education system revolves around imparting IQ and not EQ, which is most important for success
• The current education system is biased towards commercially successful companies and their technologies like Microsoft and Sun. Low cost and easy-to-implement open source frameworks are ignored and are positioned as "alien" technologies which "does not have any career opportunities" to the students.
• The general attitude, that has been built up among youngsters who are going for a job is to find a safe-secure job in a reputed stable company. They are not encouraged to take risk and help grow new leaders for the economy. It is very important to have a general "rough it out" attitude to make a place a hot destination for growing great companies. This is the reason some locations are very successful in creating great companies, while others lack far behind.

Indifferent attitude towards homegrown small and medium sized IT companies

I have personally felt that the state government has an indifferent attitude towards homegrown small and medium sized IT companies. It seems that their action plan clearly talks about getting external investment from successful IT companies worldwide. In short term this looks like a very good solution as it will get major investment in a short period of time and they will find their graph moving towards their projected figures. However in long term, it is very difficult to achieve sustainable and long term growth without tapping into the local entrepreneurial capabilities.

If you see the IT industry in Kolkata, you will hardly find a homegrown IT company who features among the top software exporters from West Bengal. In fact most of the home grown companies collectively do not employ even 25% IT workforce of Kolkata. We do not have any national hero or brand, which has made a mark on the national / global platform. When we go to global expositions like IndiaSoft and CeBIT, you do not see any company from West Bengal competing against the national players in the global marketplace.

Some basic reasons I can see are:

• There is no affordable workspace for small and medium sized IT companies except SDF Building and a couple other locations built and operated by government or a government agency like Webel. There is major discrepancy in allocation of office space and land to small and medium sized businesses.
• The law and order system is not up to the mark and in tune with possible cyber crimes. 90% of the police stations do not have any idea about cyber crime. If they land up investigating one, they will try to get rid of the same by harassing you to an extent that you will give up. Most of the police workforce is either not trained about white collar crime or they pretend not to know the subject. It is a known fact that crime rate is highest in small and medium sized enterprises, and most of them go unnoticed.
• We get to deal with government official everyday, who does not know their own work. They come from different departments and confuse you to such an extent that you see no other option, but to bribe them and satisfy them!
• Government is more interested in job creation than value creation. They are less interested in the quality and sustainability of jobs that are being created. Also, there is lesser emphasis on profitability of companies that exist. The economic eco-system works on value creation, which leads of job creation. This is not the other way around.  
• Small and medium sized IT companies are not communicated the benefits they are entitled to! This results in a scenario that all the benefits are enjoyed by a select few.
• The benefit claim process is very cumbersome and an IT business which needs a level of agility to perform optimally will not be able to claim the benefits they are entitled to, unless they put in considerable amount of effort behind the same or forge the paperwork!

Again, I personally believe that it is not the responsibility of educational institutions and government to push a business. However, for economic growth of a state which has been lying at the bottom of the economic chart for last thirty years, there needs to be initiative to creative a conductive environment.

Without most of these issues addressed, I do not see any long term sustainable growth of IT industry in West Bengal.

I wish I am wrong.

Abhishek

Here is a funny incident that took place when I was exhibiting at CeBIT 2007 in Hanover.

I was in Hanover with my friend - Srish Agrawal for CeBIT 2007. After a tiring day at the exhibition hall, we were looking for a decent dinner. The only problem was our being vegetarian.

It was quite late and we were hunting for a restaurant near Kropke. We could not locate a restaurant which will serve a proper main course vegetarian dinner. Suddenly I spotted the famed golden arch down the road. We decided to compromise with a vegetarian fast food instead of a proper dinner. Something is better than nothing.

When I reached the counter,

I asked - "Do you have vegetarian burgers?"

The lady on the counter got puzzled. She rushed to consult her senior. There were murmurs and finally she came back to the counter.

She said - "Sorry Sir. We only serve normal food."

We could not stop laughing.
That day I learnt - There are two kinds of food - Normal & Vegetarian.

We finally managed to find a small mom-and-pop shop which baked us a pizza with toppings of our choice. The guy was really friendly. The pizza was fresh and his hospitality worth a mention.

Few more difference we experienced which is worth a mention –

1) Diet Coke is known as Lite Coke

2) Mineral spring water is not common. You generally get "gas water" or "sparkling water" which is equivalent to soda water.

If you had any funny experience hunting for vegetarian food or your-kind-of-food, feel free to post. I would love to know!

I am not a very stock market savvy person. But in recent months, I did some stock investments. I made good investments and bad investments. I learnt few basics from my mistakes (I may be still wrong, IMHO) which I would love to share with anyone who cares. My opinion may change with time as I learn more. If you feel like contributing or contradicting, feel free to do so:

1. Do not listen to your "Investment Managers" or so called "Investment Experts" appointed by banks and brokers. They may get you some quick profits, but you will ultimately loose what you earned if you trade on their tips. In the current scenario, you get any guy with a MBA in Finance becoming a stock market expert in a reputed stock brokering firm. They use you to make their own money. If you really need advise, check out business channels like CNBC, etc. Listen to opinions aired by various experts and take your pick.

2. As Robert t. Kiyosaki of Rich Dad Poor Dad fame says - People make profit when they "buy". This means it is very important when you buy. Most people run away from markets when it crashes. But if you see from a positive perspective, the stock market is on a SALE! So it is the best time to buy, just as you rush to the shopping mall when there is a sale. So buy when the SALE is ON!

3. If you are a small time investor who is investing for long term capital gains, look for established companies with proven management. Try to keep your investment in blue-chip companies. Before you choose the blue-chip, look at the sector it works in and its near-term and long-term possibilities. Look how they have performed in past and what kind of guidance their management have given for future. Monitor selected companies and know how they behave with market dynamics. Your investment is safe and will multiply with time.

4. If you do not have time to manage your money, mutual funds are the way to go. Mutual funds has major entry load (as much as 2-3%). Sometime they also have exit load (0.5-2%) and minimum lock-in period. If you are investing in a mutual fund, do not forget to ask about the debt-equity ratio. You should try to understand the kind of portfolio the mutual fund will hold. Convince yourself with past performance of that mutual fund. Dont rush. Your broker earns up to 4% commission on sale and is highly motivated to give you wrong advise to sell the scheme. Be very cautious and make sure that you understand everything before you invest anything.

5. Average out your purchase. You may see volatility in the market. If you buy in one go, you might enter in a high price or a lower price. To smooth out the risk, buy at regular interval at various price levels.

6. Take a long term view. Dont indulge yourself in day trading and short selling. Do not go for short term capital gains. It only makes your broker rich and you remain where you were. 

7. Do not hesitate to negotiate. You will be amazed that you will get cash-back-discounts on your mutual fund investment from your broker (afterall he earns upto 4% of the total investment). You can also negotiate the brokerage rates and service charges.

I will keep updating this list as I learn more.

Abhishek