January 23, 2008

Open-source products are great. But know the limitations before you use it.

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!

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January 13, 2008

Offshore outsourcing in India - going through a tough time.

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! 

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SEZs are not good for Small & Medium sized IT Enterprises

With the uncertainty over the Software Technology Parks of India (STPI) scheme after the union budget, a mad rush towards Special Economic Zones (SEZs) is very much expected. I have been studying about SEZ or last three weeks and two things are very clear -
  • 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.
The SEZ is going to benefit two classes of businesses -
  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.
The unfortunate reality is that,
  • 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.
I will like to see a proper level playing field to be set up by Government of India.
  • 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.
In years to come, my company may also get into a SEZ (either on its own or through a SEZ developer). However, my stand on how SEZs are resulting in a divide between established player and small/medium sized companies will remain the same unless the policy is modified for inclusive growth (this is the term our respected PM, Mr. Manmohan Singh uses quite often).
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September 20, 2007

How to handle social networking redundancy

I was reading about Ed Kohler’s post about social networking update redundancy.

I think there can be a simple solution. To do this we may need a simple new standard format of data syndication, which can be a simple derivative of RSS. Basically every individual can have a personal RSS feed.

A person shall provide an input socket (it can be a XML-RPC based system, which already is used by Wordpress and several other blogs) when he signs up with any social networking sites or any website where he might update his personal data or make comments or blog posts. These sites can have a system to push the information to this personal RSS feed, which can be the only RSS feed that your friend need to subscribe to know all the latest news about you or your company. I understand that when all data is pushed to the same personal RSS feed, redundancy can be controlled by smart pattern matching algorithm (may be simply matching the heading to start with).

I think this technical solution might work :)

 

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Embracing Pain For Entrepreneurs

I came across this quote today at BusinessPundit

We must embrace pain and burn it as fuel for our journey. - Kenji Miyazawa

How true :) When you start a company, you get rejected by almost everyone:

Bankers:

They want to lend you money only if you have a strong financial background. Ever thought, why will you even go for borrowing money if you have that solid financial backing!

Customers:

Have you heard prospects saying - You dont have enough credentials! Its a chicken and egg situation. You got to get few customers to build credentials. But to get customers, you need credentials.

Employees:

Have you heard people saying - I don’t see a future in your company. I would prefer to work for an established brand. Have you ever thought that "established brand" was also built by some "go getters" who came out of their comfort zone and took risk to build the "established brand".

I don’t want to rant about the pain. Just want to let you know that everyone faces this. Only those people, who use it as a fuel for their journey succeeds. Those who give up results in those 80% of the businesses that dies within the first few years of operations!

Keep going!

 

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August 20, 2007

Learning in the age of information overload

Blogs have fueled the growth of peer-to-peer information flow in form of news, knowledge packets, ideas and individual point-of-views. However it has also resulted in "Information overload" which drives a normal person nut as he is at risk to wasting too much time reading the flesh before he reaches the crust.

Learning becomes more difficult as we face a situation where we have less time and most if it is wasted while absorbing the excess information and then an equal amount of effort (if not more) is required to skim the real message out of it.

A hot debate is going on at - http://guydz.com/moneypowerwisdom/?p=19

I personally think:

A summary can solve all the problem. There are people who understand the concept in few words. They hate to read through long articles to get that “dosage” of knowledge.

However, there are lots of people who might have difficulty in understanding the concept. There may be several people who might not accept a point of view unless backed with examples from real life.

Therefore both formats are required in my opinion.

Now the question is - On a media like blog, do we have enough time to summarize the ideas that we put together?

 What do you think?

 

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August 14, 2007

West Bengal - Poised to take a leap in IT & ITeS?

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

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June 1, 2007

Most important soft skill in life?

I was trying to think out - What is the most important soft skill in life?

Some options I came across:
Communication? Public speaking? Problem solving? Team management? Time management?

The list was getting too long!

I tried to find a common thread which underlines several soft skills which came to my mind. I zeroed upon something which can be described as - "ability to take neutral view-points" to be the most important  of all. Communication is an integral part of our personal and professional life. To interact and understand the communication and to respond in an appropriate way, it is most important for a person to be able to see things from various viewpoints and understand the reason behind an action. Only when we understand the reason behind someone’s action, we can modify our approach to get the desired result from the person we are dealing with.

A person should be able to put himself in place of the other person and see how will he feel or how will he react to a given situation. This skill can be very important for people who work in communication-centric jobs like sales and marketing, public relations, teaching, project management.

The root cause of all problems and disappointments is that we see things the way we want to see it. We all do this mistake conciously or unconciously.  However whenever we interact, we can try to remind ourself - "Step in his (the other person’s) shoes".

Happy changing shoes!

 

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May 24, 2007

What can we do for India?

Dear Friends,

I got this email today in my mailbox. The mail says that this is a speech from Dr. A.P.J. Abdul Kalam, President of India. I am not sure about the source, but the message is definitely thought provoking. I think it is something every Indian should read at least once and think about "Our role in building a developed India".

Here is the message

===================================

Why is the media here so negative?
Why are we in India so embarrassed to recognize our own strengths, our achievements? We are such a great nation. We have so many amazing success stories but we refuse to acknowledge them. Why?

We are the first in milk production.
We are number one in Remote sensing satellites.
We are the second largest producer of wheat.
We are the second largest producer of rice.

Look at Dr. Sudarshan , he has transferred the tribal village into a self-sustaining, self-driving unit. There are millions of such achievements  but our media is only obsessed in the bad news and failures and disasters.

I was in Tel Aviv once and I was reading the Israeli newspaper.

It was the   day after a lot of attacks and bombardments and deaths had taken place. The Hamas had struck. But the front page of the newspaper had the picture of a   Jewish gentleman who in five years had transformed his desert into an orchid and a granary.   It was this inspiring picture that everyone woke up to. The gory details of killings, bombardments, deaths, were inside in the newspaper, buried among   other news.

In India we only read about death, sickness, terrorism, crime. Why are we so NEGATIVE? Another question: Why are we, as a nation so obsessed with foreign things? We want foreign T. Vs, we want foreign shirts. We want foreign technology.

Why this obsession with everything imported. Do we not realize that self-respect comes with self-reliance? I was in Hyderabad giving this lecture, when a 14 year old girl asked me for my autograph. I asked her what her goal in life is. She replied: I want to live in a developed India.  For her, you and I will have to build this developed India . You must proclaim. India is not an under-developed nation; it is a highly developed nation. Do you have 10 minutes? Allow me to come back with a vengeance.

Got 10 minutes for your country? If yes, then read; otherwise, choice is yours.

YOU say that our government is inefficient.
YOU say that our laws are too old.
YOU say that the municipality does not pick up the garbage.
YOU say that the phones don’t work, the railways are a joke,
The airline is the worst in the world, mails never reach their destination.

YOU say that our country has been fed to the dogs and is the absolute pits.

YOU say, say and say. What do YOU do about it?
 
Take a person on his way to Singapore . Give him a name - YOURS. Give him a face - YOURS. YOU walk out of the airport and you are at your International best. In Singapore you don’t throw cigarette butts on the roads or eat in the stores. YOU are as proud of their Underground links as they are. You pay $5 (approx. Rs. 60) to drive through Orchard Road (equivalent of Mahim Causeway or Pedder Road) between 5 PM and 8 PM. YOU come back to the parking lot to punch your parking ticket if you have over stayed in a restaurant or a shopping mall irrespective of your status identity… In Singapore you don’t say anything, DO YOU? YOU wouldn’t dare to eat in public during Ramadan, in Dubai.

YOU would not dare to go out without your head covered in Jeddah.

YOU would not dare to buy an employee of the telephone exchange in London at 10 pounds ( Rs.  8 50) a month to, ’see to it that my STD and ISD calls are billed to someone else.’YOU would not dare to speed beyond 55 mph (88 km/h) in Washington and then tell the traffic cop,
‘Jaanta hai main kaun hoon (Do you know who I am?). I am so and so’s son. Take your two bucks and get lost.’

YOU wouldn’t chuck an empty coconut shell anywhere other than the garbage pail on the beaches in Australia and New Zealand.

Why don’t YOU spit Paan on the streets of Tokyo ? Why don’t YOU use examination jockeys or buy fake certificates in Boston ??? We are still talking of the same YOU. YOU who can respect and conform to a foreign system in other countries but cannot in your own.

You who will throw papers and cigarettes on the road the moment you touch Indian ground. If you can be an involved and appreciative citizen in an alien country, why cannot you be the same here in India ?

Once in an interview, the famous Ex-municipal commissioner of Bombay , Mr. Tinaikar , had a point to make. ‘Rich people’s dogs  walk on the streets to leave their affluent droppings all over the place,’ he said. ‘And then the same people turn around to criticize and blame the authorities for inefficiency and dirty pavements. What do they expect the officers to do?

Go down with a broom every time their dog feels the pressure in his bowels?

In America every dog owner has to clean up after his pet has done the job. Same in Japan . Will the Indian citizen do that here?’ He’s right. We go to the polls to choose a government and after that forfeit all responsibility. W