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Breaking the Growth Barriers in the IT and Software Sectors
There's nothing automatic about corporate growth, particularly in the information technology industry; "build it and they will come" is a myth. In the real world there is either a structured, process-driven growth cycle, or stagnation — and...
Coaching-An Adapting Tool For Attaining Fulfillment In The Global Economy
At a time when the global economy is bringing innovation, new ideas and new opportunities into the marketplace, outsourcing and the elimination of white-collar jobs has left many of us feeling anxious and insecure about the future. It is...
Extended Enterprise In The Nesting And Cutting Business
In Italy there are a lot of small and medium enterprises (SME) that often act as subcontractors to bigger firms.
For example, most of the Italian shoes come from industrial districts, where the organization heavily relies on subcontracting. ...
Small Business Q & A: Choosing A Business That's Right For You
Q: I really want to start my own business, but I have no idea what business would be best suited for me. I'm also eager to get started, but I don't want to pick the wrong business just because I'm impatient. How should I go about deciding what...
Strong competitive moves should always be blocked.
Most companies have only one chance to win, but leaders have
two. If a leader misses an opportunity to attack itself, the
company can often recover by copying the competitive move. But
the leader must move rapidly before the attacker...
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Outsourcing: Spawning of India's JumpStartUP Firms
A significantly large number of start-up company founding
fathers, Chief Technical Officers, engineers and venture
capitalists in California's Silicon Valley today, can be found
to trace their roots to India. Because, for a long period of
time, India's best-trained engineers were lured by bigger,
fatter paychecks for doing the same job in USA or other western
nations. Then too, it could also be due to information
technology off-shoring / outsourcing, as IT professionals in
India were way too busy providing services to well-paying
overseas clients, leaving them no time out for their own
innovative product development for American and Indian markets.
But, the impact of off-shoring / outsourcing on indigenous
innovation is not as clear cut, going by the experiences of
Infosys Technologies and Ittiam, two very different Indian
companies. Providing off-shoring / outsourcing services on a
large scale left little opportunity for Infosys to dabble in
innovative in product development. Yet, by establishing their
presence as competent off-shoring / outsourcing service
providers, they opened the door of opportunity for other Indian
service providers, many of who argue that off-shoring /
outsourcing is a training ground for teaching India's next
generation on how to become tech entrepreneurs.
Founded in 1981, to design, develop and maintain software for
American banking, telecommunications and manufacturing corporate
clients, Infosys Technologies has become India's third largest
IT services company. In the 1980's, when business became slow,
Infosys created proprietary banking software, still in use by
70% of Indian banks, even today. It wasn't until 1991 when the
Indian economic market was liberalised that the Indian software
services industry took off, and it was around this time that
Infosys decided to give up product development not wanting to
conflict with clients. A strategy that has proved highly
successful for the company with revenues climbing to 30 to 40%,
and most of the intellectual property generated going back to
clients.
The other side of the coin, Ittiam Systems, the indirect outcome
of off-shoring / outsourcing. From service providing Texas
Instruments (TI), led by Srini Rajam, the crew of TI
Associated Websites
set up
their start-up company in 2001 to make cheaper and better
digital signal processing systems. Securing a $11.5-million in
venture capital financing, by 2004 Ittiam began to earn
$1-million in profits annually. Srini Rajam, CEO Ittiam, a
former employee of Indian off-shoring / outsourcing firm Wipro
Technologies, and then Texas Instruments India division, sees
himself and his company as the indirect benefit of the
off-shoring / outsourcing phenomenon. According to Rajam:
"Outsourcing will help innovation, it gives people confidence
and experience." in addition to high salaries that give them the
freedom to risk taking on new ventures. And, Ittiam is not the
only example, as alumni of off-shoring / outsourcing companies
such as Wipro, Infosys launch dozens of start-ups in India
funded by JumpStartUP, a venture capital firm based in Bangalore
and Santa Clara, California. S. Anandaram, co-founder
JumpStartUP andformer Wipro employee offers an explanation for
the trend. He believes as India's economy booms, an equivalent
lifestyle, pay check and homesickness is enticing talented,
skilled and experienced Indians to return home from USA and
other western countries to don the mantle of leadership. Another
reason could be that people serving multinational clients have
gained the confidence and critical experience necessary to
manage global operations. Most importantly, the trend has
evolved with a cultural shift in attitudes to entrepreneurs who
were formerly regarded as people unable to retain regular jobs,
and failed businesses were equated with personal failure. These
days, Rajam says: "a startup is no longer viewed as a no-no. It
is in fact viewed very positively." He is substantiated by
Ashish Arora, a professor of economics and public policy at
Carnegie Mellon University: "At least some of this change can be
credited to outsourcing. If India has any kind of successful
product development, it will be because of the success of the
software services sector."
About the author:
For further information on offshore outsourcing and
offshore software
development, please visit http://www.a1technology.com
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