IDG Connect has conducted in-depth interviews with a cross section of thought leaders on the ground in India, including the CIO of Cisco, the President of NetApp and Executive of Deep Computing at IBM. The aim of this report is to discover how professionals feel about the future of business in India 2014.
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Business India 2014: A Bright Future?
1. BUSINESS
INDIA
2014:
A Bright FutUre?
IDG Connect has conducted in-depth interviews with a cross section
of thought leaders on the ground in India, including the CIO of Cisco,
the President of NetApp and Executive of Deep Computing at IBM.
The aim of this report is to discover how professionals feel about the
future of business in India 2014.
Image courtesy of Prayudi Hartono
2. BUSINESS INDIA 2014: A BRIGHT FUTURE
IDG CONNECT
Read the full interviews here:
INTRODUCTION:
Anil Valluri:
President of India & SAARC Operations, NetApp
Brinda S. Naraya:
Author, Bangalore Calling
Hareesh Tibrewala:
CEO of Social Wavelength
Kalaivani Chittaranjan:
MD and CEO of eMudhra Consumer Services
Neeraj Varma:
Director of Sales for Xilinx India
Subram Natarajan:
Executive - Deep Computing, IBM India South Asia
Suchit Bachalli:
Executive Vice President, Unilog Content Solutions
SomPal Choudhury:
MD, Analog Devices (ADI)
V C Gopalratnam:
CIO, Cisco India
Venkat Viswanathan:
CEO and co-Founder of LatentView
Bangalore panorama
Image courtesy of Ted Drake via Flickr
“A lot of people work night shifts in Bangalore;
IT people, BPO people or call centre people
returning home at 2am or 3am,” Brinda S
Narayan, author of Bangalore Calling, a novel
about an Indian call centre, told IDG Connect in
Autumn 2013. This will come as little surprise to
anyone who is familiar with the waves of Indian
outsourcing which have gone on over the last
decade. But what did surprise Narayan, who grew
up in Bangalore herself, was the sheer volume
of parents who felt they had to wait up for their
grown up kids to come home.
“A large number of mothers and fathers [I spoke
to whilst I was researching my book] said, ‘Oh I
have to get up at 3am and I have to open the door
for [my son or daughter], heat up dinner, keep
them company and chat with them.’ So I said,
‘why don’t you just give them a key?’ And they
were really appalled that I was asking them that
question.”
“These parents are completely disrupting their
own sleep cycles because they don’t want to
miss out on the contact [with their children],”
explained Narayan “[But] what I realised is that
these families are really buffering the effect
of these different time zones [many young
Indians are working in]. This helps international
companies. It is not easy to keep people working
at very odd times, because they can lose social
contact with their community.”
In some ways this story highlights the current
business situation on the ground in modern
India. Because beyond the tales of a falling rupee,
conversely buoyant stock market, and an up-andcoming election, the supreme rule of the family
underpins business.
There is a vast youth population, which is
consistently up-skilling itself, driven on by
ambitious parents. This constant attempt
at upward mobility means in turn there is a
massively escalating middle class, whilst budget
services - like call centres - which India has
become known for are being gradually undercut
by ever-cheaper markets.
India is clearly at a cross roads, yet despite
negativity from outside the country, there is
remarkable positivity on the ground. Over the
last few months IDG Connect has been speaking
to thought leaders from a variety of companies
in order to build a picture of the business
landscape. In the course of these conversations
a remarkably consistent view has emerged of an
India, which whilst not without problems, appears
to have a lot of hope for the future.
3. BUSINESS INDIA 2014: A BRIGHT FUTURE
IDG CONNECT
Bangalore KFC & cows
Image courtesy of Christopher
Neugebauer via Flickr
manufacturing sector. Now with all the young people joining our workforce, we have to expand beyond
our typical white collar services sector and move into manufacturing.”
THE MANY DIVISIONS OF INDIA
“Dirty, straggling houses, with now and then an unexpected court composed of buildings as illproportioned and deformed as the half-naked children that wallow in the kennels.” It sounds like a scene
from modern India, but is in fact Charles Dickens’ description of Seven Dials in London.
The parallels with 19th century industrialising Britain are plain to see: from the slums that exist cheek-byjowl with a rapidly expanding middle class to the print newspaper trade, which is growing so rapidly that
even second hand papers have a market. Yet this marks a conflict of its very own:
“Look at how a typical developing nation grows,” Som Pal Choudhury, MD of Analog Devices explained. “It
goes from agriculture to manufacturing, then as the country grows, it moves into services.” India missed
a step. “It went from agro economy straight to a services economy without transitioning through the
Over the last decade or so, India has carved a niche as an outsourcing destination for foreign
businesses. “If you visit Bangalore and you go into these IT complexes they’re very different from the
city outside the complex,” said Narayan. “It is almost like you’re entering a very different world. You
might be going into Singapore, yet you come out and there are all these pot holes across the street [and
people living in slums]. It is not equal between those inside the concrete complex who are very well paid
and public roads are almost falling apart. There is a very stark divide in the city today.”
On top of which, all the furious activity has left “Bangalore bursting at its seams,” Suchit Bachalli
Executive Vice President and Co-founder of Unilog Content Solutions told us. “It is half as liveable today
as it was 10 years ago.” The housing is extremely expensive and “for those who can afford it; it is hard to
ignore the fact you don’t have drinking water out of your tap, you don’t have 24/7 power and you step
out of your house into a traffic jam – it takes an hour and a half to do 10 – 14 KM.”
This situation is unsustainable in a huge number of different ways, not least because India is gradually
being undercut by ever cheaper markets. “It’s a relentless trend,” wrote Mike Magee for IDG Connect,
“and it means companies are looking outside India to countries where prices and the standard of living
are much lower. The fear is that at some point the drive to keep costs low will hit a brick wall, and in 10
years there will be nowhere left where labour is cheap, leaving eight billion people on the planet looking
for work.”
4. BUSINESS INDIA 2014: A BRIGHT FUTURE
IDG CONNECT
THE NEED FOR FEWER SERVICES & MORE INNOVATION
This can stifle entrepreneurial innovation. ‘The
World Startup Report’ published in Spring 2013,
for example, included a quote from an individual
who said: “If you want to get married don’t do
a startup”, whilst the presentation itself added,
“It’s a bad point on the matchmaking checklist,
like being a struggling artist (without the
glamour)”. This social point was picked up in a
comment on TechCrunch, “Getting married and
prospective in-laws are a major issue in Indian
Entrepreneurship circuit.”
Talvinder Singh, Founder of Tushky.com
supplemented this point with a first-hand
account: “[The] World expects you to be some
millionaire by now. Three years is like the litmus
test of survival for any startup. And that’s when
you are expected to marry. Well, a broke founder
(ok, not really broke. Yet.) of a crazy idea isn’t a
hot selling product, after all.”
However, as Indian outsourcing begins to
wane in favour of ever cheaper markets there
is a desperate need for creative thinking and
innovation. Suchit Bachalli, Executive Vice
President and Co-founder of Unilog Content
Solutions told us the real opportunity for
Indian companies will be to become innovative.
“There are companies that are doing software
development, but they are told what the
solution is. Very few companies, in my opinion,
are at the problem [solving] end of it and are
actually designing solutions and implementing
them worldwide. Yet many Indian companies are
sitting on a goldmine of data.”
“I would like to see India considered as an
innovator,” continued Bachalli. “The lack of
innovation bothers [me]. Everyone seems to be
very content with a desk job. In the West it’s the
opposite fear. There the worry is that someone
in India or China will take your job. But [I think
Indians are] taking the wrong kinds of jobs.”
“Everything is used,” he explained. “[Local
CIOs] figure out all kinds of things to make it
happen. Indian enterprises are [also] willing
to take a lot of risk. I have seen a lot of multinational companies which are very risk averse.
[Indian CIOs are] more savvy from a technology
standpoint than elsewhere the world; they
get [technical] to a point beyond reason. They
understand technology very well and are usually
focused on it, sometimes to a point of being very
detrimental to their own interests.”
Mix of styles
Image courtesy of myhsu via
Flickr
The change will necessarily be slow and based
around professionals’ mind set, but Bachalli
is hopeful. “I was at a conclave for Big Data in
Bangalore [in the Autumn and] it was most
heartening because [whilst] the average Indian’s
reaction to any new technology is to [talk about]
setting up a training institute… or [talk about]
outsourcing services to the west. I did not hear
any of that. The thought process was: this is a
great technology, what are the applications we
can build on it?”
Despite a traditionalist mentality there has
always been a certain spirit of innovation
within IT departments themselves. Anil Valluri,
President of India & SAARC Operations at
NetApp talked to IDG Connect about the catchall Hindi-Urdu term “Jugaad” which, literally,
means an improvised work-around due to lack
of resources, but has come to typify a way of
thinking.
“This is [the spirit of] ‘make it happen,’” Valluri
told us. He believes this mentality has defined
Indian IT to date. “There is a ‘make it happen’
tendency [in Indian IT]. You can conjure up
absolutely impossible things out of nothing in
Indian data centres and IT infrastructure.”
“
There is a ‘make it happen’ tendency [in Indian IT].
You can conjure up absolutely impossible things out of
nothing in Indian data centres and IT infrastructure.
Anil Valluri, President of India & SAARC Operations at NetApp
“
Outside tangible divisions of wealth and
poverty, there are a number of stark fault
lines that run through India and impact the
business landscape. The most notable of
these is that India is very traditional and very
traditionalist. Families put their children under
a lot of pressure to do well, which can come at a
marked fear of risk; we all know the cliché about
Indian parents desperately wanting their sons to
be doctors.
5. Indian Family
BUSINESS INDIA 2014: A BRIGHT FUTURE
IDG CONNECT
Image courtesy of Wen-Yan King via Flickr
THE FAST RETURNING DIASPORA
“Talk to any Indian on the planet; they
will all say they came back [to India
from abroad] for family reasons,” V C
Gopalratnam CIO of Cisco India told IDG
Connect. “[This was certainly] true in
my case. [But] more than that, it was
the opportunity to be part of something
different.” Like many successful Indian
IT professionals, Gopalratnam returned
to India after 17 years in the US because
things were improving rapidly at home.
“The standard of work in India is going up
[continuously],” Neeraj Varma, Director
of Sales for Xilinx India told us. “Cost
arbitrage is no longer as attractive as
it used to be. [And we’re] increasingly
[getting work] because [of our] talent,
quality and technology. Back office
processing and call centres will continue
to move to cheaper markets. [But] the
value-based work will continue [to move to
India].”
India has a young population (median age
26.5) of 1.2 billion and the third largest
education system in the world. This
comprises of more than 500 universities
and around 30,000 colleges, many of
which are focused on tech. This represents
a huge amount of IT talent and potential.
Due to this, the government has been
placing a real emphasis on Indian
Institutes of Technology (IITs) in recent
years. As part of India’s new science
policy, it aims to see the country placed
in the top five global scientific powers
by 2020. “All education institutions are
mandated with conducting research,”
Mr. Subram Natarajan, Executive - Deep
Computing, IBM India South Asia told
IDG Connect. “There is a very conscious
effort to improve the skills by government
agencies.”
Skills are of continued importance in
this type of market place. The problem,
clarified Varma, is finding good middle
management “project leads” people who
,
have seven or eight years’ experience of
the full project life cycle. Graduates are
not so much of a problem.
This is where the returning diaspora
provides the missing part of the jigsaw.
“India is really good at services,” explained
Varma “We’ve mastered the art of
services. [But] an engineer who works for
a company [in India] may not get close
to a product lifecycle, he’ll just be doing a
small piece [and] doesn’t get the exposure
on a managerial level to complete the full
life cycle.”
Yet the returning diaspora “have worked
in cutting edge technology. [And] they
make excellent middle management,” he
continues. “We have seen them both as
our customers and at Xilinx itself. [In fact]
over half of [the people we deal with] have
worked in US and returned. This is a very
healthy trend to help local companies to
really come up with the value.”
“
“
The big change for India over the last
few years is that Indians, who previously
moved abroad and never returned, have
started to come back home. This is having
a noticeable impact on business on the
ground because professionals are now
bringing different working practices back
with them.
The standard of work in India is going up.
Neeraj Varma, Director of Sales for Xilinx India
McKinsey estimates that the US (alone) will
experience a shortage of almost 1.5 million
big data professionals by 2018. “Those types
of jobs can only be filled by economies like
India,” said Venkat Viswanathan, CEO and
co-Founder of LatentView. “[This is a country
which] continue[s] to produce large numbers
of educated people who can potentially be
groomed into these particular talent gaps.”
World business tends to operate from a very
western point of view, but the unique Indian
mind set actually brings some very distinct
advantages. “We like to go out and meet
a lot of people and make a lot of friends.
[This means] Facebook pages from India
have a larger number of friends than say the
US, which I think is very cultural,” Hareesh
Tibrewala, CEO of Social Wavelength told us,
and this approach to communication also has
a noticeable impact on the workplace.
“The way the US has developed [means]
there tends to be more of a sense of
independence. People tend to be more
self-starters. People tend to work [well]
on their own. As a result the culture in the
organisation has evolved along those lines,”
explained Gopalratnam.
“Whereas if you look at India - because of
the way our society is structured - it is a very
collaborative environment. People tend to
work better in teams,” he continued “and the
younger generation coming in makes this
[even more pronounced] because everything
they do is collaborative. That impacts how
work gets done in a US environment vs. an
Indian environment. There is a stronger
sense of community in India than you would
see in a western context. [I think] that is the
single biggest difference [between the US
and India].”
6. BUSINESS INDIA 2014: A BRIGHT FUTURE
IDG CONNECT
This in turn is having an impact on IT
across the board, from BYOD to its
corresponding security concerns… but
above all in the explosion of data. “The
[sudden] data explosion has hit India
harder,” said Valluri. “Because we didn’t
have internet access in the remote areas
[until recently], it was only the cities. But
with the smartphones taking over, the
class B and class C towns are now all on
the net.”
To add to this the population is growing
and the new generation born and raised
with gadgets are increasingly looking for
services online. The government is using
this to facilitate better processes, such as
Ms. Kalaivani Chittaranjan, MD and CEO of eMudhra
official identity documents. Ms. Kalaivani
Chittaranjan, MD and CEO of eMudhra told
IDG Connect about how the government
has established cyber kiosks which
provide instant services for citizens:
Mall Bangalore
Image courtesy of Saad Faruque via Flickr
“These people may not be literate, but
they can walk in say what they want and
the information can be printed out there
and then. This means people with no
access to the internet are now able to
make use of online facilities.”
Problems associated with poor
infrastructure are so intense that a small
number of cutting edge new startups are
looking to offer creative solutions. Google
Executive Chairman Eric Schmidt wrote
in an opinion piece for the ‘The Times of
India’ in the Spring:
“The most striking Indian internet
innovations won’t come from big
institutions or companies moving online.
They will come from Indians solving
local problems.” He went on to cite the
case of Redbus, which took the mess of
multiple bus companies working across
the country and provided an answer.
Schmidt’s conclusion to this was, “You
don’t have to aim for foreign markets
to be successful. You just have to solve
local problems in a way that’s globally
applicable.”
“
The most striking Indian internet innovations won’t come
from big institutions or companies moving online. They
will come from Indians solving local problems.
Eric Schmidt, Executive Chairman, Google
“
The technological changes which have
gradually taken hold across the world now
appear to be hitting India all in one go. In
September, the Times of India reported
that this year India has seen an 89%
increase in smartphone users from 2012.
“Mobility is putting a lot of pressure on
system,” Anil Valluri President of India &
SAARC Operations at NetApp India told
IDG Connect. The Times of India article
compared accelerated smartphone
growth to that in Brazil, but with the
important caveat that Indians are skipping
a generation of multimedia phones.
Prashant Singh, MD of Nielsen India told
the paper: “Users will migrate straight
from a feature phone to a smartphone.”
People with no access to the internet are
now able to make use of online facilities.
“
THE IT MARKET REACHES MATURITY
“
7. BUSINESS INDIA 2014: A BRIGHT FUTURE
CONCLUSION
The western media is full of stories about how India is failing, yet the picture from thought leaders
on the ground is far more positive. Of course India has its problems. It is a country characterised
by division, which is currently battling the transition from cheapest outsourcing destination to
innovative strategic market.
However, all the building blocks appear to be in place for future success. India has a massive
population of young people who are consistently encouraged by their families to upskill themselves,
while the government is actively pushing educational excellence. It has a large returning diaspora
which is bringing best practices from abroad, back home. And it is has its own unique approaches to
the workplace, which hinge on collaboration and a spirit of ‘make it happen’.
“I think people need to understand,” concluded Gopalratnam, CIO of Cisco “that India is not just
about talent or cost. It is actually a business opportunity.” This point was vigorously seconded by
Rao Yanamandra on our website. He went on to add: “[It] can even be extended to other developing
countries in Asia.”
About IDG Connect
IDG Connect, a division of International Data Group (IDG), the world’s largest technology media company,
produces, publishes and distributes local IT and business information on behalf of a truly global client base.
Established in 2005, we have a fully nurtured audience of 2.6 million professional decision-makers from 130
countries, and an extended reach of 38 million names. This lets us conduct research, create independent
analysis and opinion articles, and drive long-term engagement between professionals and B2B marketers
worldwide. For more information visit www.idgconnectmarketers.com