I found this very interesting quote in someone’s signature whom I met on a business networking website:

"If you want to go fast, travel alone; but if you want to go far, travel together."
- African Proverb

How true - specially for software programming teams, which are so vulnerable due to individualistic goals. As if there is no tomorrow!

Proper project management is key to a successful project. To manage multiple projects and teams which are geographically spread across the globe, you need a quality project management tool.

As a medium sized web development company, we looked around for some quality software which suits our requirement and does not burn a hole in the pocket. Here is our pick!

Basecamp HQ:- A nice, minimalist simple to use software true to the philosophy of 37signals, the company which built it. This software is only available in a SaS (software as service) model. IMO this software best suits small projects which are communication centric. It lacks version control, task management, project tracking along with cost-benefit analysis.

Overall, very easy to easy and adapt, but reporting is not up to the mark. If you are a small business and you do most of your project management yourself, this can be a good choice for you.

Intervals:- It seems to have picked up the baton where Basecamp HQ has left. It also works on a SaS (software as service) model. It has more features (specially in terms of reporting and role management) than Basecamp HQ, thus making it suitable to manage complex projects across a large organization.

Overall, it is a good attempt to overcome the shortcomings of Basecamp HQ. However it needs to improve on its usability. It also needs to provide staged progression in terms of features and complexity so that small businesses can adapt the system. I am sure that this software will become popular as they keep improving and become old. For a SaS model company, time-tested reliability is more important than anything else.

Ace Project:- A comprehensive project management software with user friendly interface and short learning curve. It has different licensing policies and therefore you can rent or buy off (with our without source code) the software to suit your organizational needs. This software is around for quite some time and therefore seems to be reliable.

It has decent reporting capabilities, but not as good as what Intervals claim to have!

Dot Project:- The best free open source project management software that I have come across. This software looks flexible and extendable. You can plug in various modules, including Mantis (for bug tracking). The usability and reporting leaves much to be desired. So if you are looking at free project management software with access to source code, Dot Project is a good choice.

Conclusion:

There is nothing called a perfect project management software. The usage, the users and the desired result determines the one which suits best for a given organization. So take your pick from the above mentioned toolset.

• 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.

There is a big debate over India becoming an IT super-power. Every few days I will meet an over-excited guy who is impressed with the growth of Indian IT companies an think that they will take over the world soon!

Let us do an acid test to determine if this is true!

Let us consider a hypothetical scenario that India & the USA are no more allies in economic growth. Let us further consider that both countries have imposed trade restrictions and sanctions on the each other!

Now, the USA does not have access to a big English-speaking pool of talent to develop their superior software at a lower cost.  That’s a big blow. Will the USA survive this? I think they can. There are other developing economies like Brazil, China, Taiwan, etc. which can fill in the gap (initially they may be not as good). So overall they will have a tough time.

Now, consider that India does not have access to products and technologies developed and patented by US based companies. What will happen? Life without Microsoft products, Oracle databases, Google, etc.

Think. Think harder.

Possibly we cannot think of such a scenario! It is beyond our imagination.

This means that India, as an economy is dependent on the technologies and products developed by US companies and not the other way around as many software outsourcing companies think (and as their CEOs will debate with me at length).

So, India works as an "employee" and/or "self employed entity" for US - the "businessman" and/or "investor" (if I have to go by the definition of Robert T. Kiyosaki of Rich Dad Poor Dad fame). This means that Indian IT economy at this point is not "financially free" and is totally dependent on the "investor" who controls the game. It will be very difficult to change the scenario, unless, Indians stop day dreaming of the "IT super power status" and get out of the "luxury bed of benefits and perks" and start working for themselves.

Now we know - who needs whom!

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

India has been regularly "labeled" as the ultimate software offshore outsourcing destination. Advantage India has been expressed in terms of location, better adaptation to english language, cost, quality talented pool and a young population.

However, it seems that India is fast loosing the low cost advantage due to inflating salary bills in IT industry. India is leading in terms of attrition and salary hikes. It is inevitable in a growing economy, but the question is - how long can we sustain this? I know of several software service companies where there is an annual increase of 40-50% (on the lower side) in salary bills. There is not a very high increase in skill level of the professionals either.

So what is the end result?

A declining profit curve (read it right - profit per person / per month)! It might not be immediately visible due to growing "net profit" which is increasing since all the companies are in a mad rush to hire as many professionals as they can to keep "up" their net profit by working in volumes as profit per person dips.

But this is definitely going to make the dent. And it is already visible in patches! Check out how a company decided to move to US to save money on his operational cost! 

I have spoken to some HR managers about their "suggested" solution for this situation. In general I have heard of these two workarounds -

1. Moving up the value chain

2. Averaging of salary

Option 1, is most attractive. However it is not very easy for a company to move from an "outsourcing" business to a "consulting" business which is the next logical step in the value chain. It not only requires physical presence (unless someone comes up with an innovative way to do it online). But if any company can do it, nothing like that!

Option 2, is what most companies are doing. They hire a top professional and then make up for the high salaries by hiring several junior professionals to balance out the spike in salary and get an average salary which is profitable to them. This works and will work, as long as the company keeps expanding. But it has a limitation in terms of "critical mass" where it will no longer be feasible and the balancing act will become so complicated that it is bound to result in a miss. The worst thing is that a miss at that "critical mass" will result nothing but disaster.

At this point there is no "silver bullet" solution for this problem. However this is for sure that India will not remain an attractive destination for outsourcing for low cost labor for long. Either it will loose its edge to emerging low cost economies or it will reinvent itself as an economy which is higher up the value chain.

Only time will tell, which way things go!