Adbication of Governance

That there have been bombings in 2 major cities (Bangalore and Ahmadabad) and scores of bombs found in Surat, which did not go off because the device did not work rather than vigilant security officers comes as no surprise. With a dysfunctional government and unscrupulous politicians at helm this is a natural consequence.

For last 5 yrs there has been a India hype where India was placed alongside China in world's cross hair and was lauded as the next big power. The sad part is that many in India also got blindsided by this euphoria and ignored some fundamental aspects that contribute to growth of a nation (economically as well as socially). Entrepreneurs started believing or at least posed as they believe that governance was not that important and India Inc, can fuel GDP growth and sustain it even as people's representatives in parliament are working to pull the rug from under their feet.

They underestimated the nuisance value of people like Prakash Karat and Arjun Singh and ambivalence of Manmohan Singh and the murky political landscape in all the states, and just assumed that things will get sorted out in evolutionary manner. Everyone believed that just as Indian enterprises transformed and evolved owing to effects of globalization, Indian politicians too will evolve into better statesmen or at least human beings as we ride the growth wave.

Unfortunately this evolutionary cleansing It did not happen and today we are faced with a heightened security threat from homegrown and international terror groups and reduced GDP/Industrial growth.

To create a sustainable economic model and a secure society there needs to be a vision and ability to articulate and assess opportunities and threats and act in the interest of nation, which can only happen when people governing the nation have some basic skills and attributes. It is highly unlikely that people who have bloated their assets by being career politicians with a dirty track record of divisiveness and criminality will transform overnight into statesmen and visionaries, at best they can become pretenders like Lalu (successfully). [Interestingly Lalu has been credited with turnaround in Indian Railways and have been on whirlwind lecture tours in B schools giving lessons in management, no one seem to question why same Lalu pushed Bihar in being a derilict state where there is no power, no roads, no electricity, rampant corruption, high crime rate in 15 yrs he ruled the state. The simple answer is that he always focused on Bihar as primary arena and largely ignored the Indian Railways, where seeds of transformation was sowed by his predecessor and McKinsey was already in helping the executives there. Moreover people fawning over him forget that he was actually sent to jail for blatantly looting money from state exchequer and later resorting to criminal bullying when order was passed to arrest him and send him to jail. He bartered his freedom and exoneration from all his crimes for support to the current government]

India sorely lack such politicians and is unlikely to see any major change as the source does not have stock of this kind of inventory. The process of becoming an MP or legislator itself ensures that most corrupt and criminals climb up faster and better than anyone with honest intentions and skills. This stems from the way local self governing bodies are elected where people whose life is affected most don't give a heck as to who is elected and how, as they consider themselves above such slimy process. The other supply source is the family and relative inc., where progenies jump the ladder owing to family connections, where you may not be ridden with a criminal (if you are lucky) but certainly with and incompetent fool with no ability to lead and inspire. Indian middle class, companies and the critics of the governance hardly make an effort to invest in alternative source and unless they take an initiative to farm and nurture statesmen we will continue to have unpredictable and crappy politicians. So do not wonder when the GDP growth slows and when we are attacked by terrorists, since we have created a conducive ambiance for them.

Commie Foreign Minister

Pranab Mukherji, India's foreign minister is a communist supported stooge in the present government. What is most disturbing is that he is allowing these politically marginalized buffoons to influence India's foreign policy at an unimaginable levels. This is as though Chinese socialist bosses have a direct authority on what India's foreign policy should be and how it should treat US, Tibet and rest of the world, all aligned to China's interest.

There is no doubt about the fact that the present govt run by an impotent PM on front an unaccountable Italian lady from back and pushed around all over the place by unholy alliance members which include regional satraps, murderers (Shibu Soren was convicted for murder), terror outfits (Muslim league etc) and communist is very weak to protect India's interest and even willingly compromise it just to remain in the stead.

India is loosing or has already lost the opportunity to strengthen its relation with US and Israel and leverage the nuclear deal it had struck with the US because Communist in India feel that it will help US and will be against China. They don't want to do anything that is against China as they revere it as the last bastion of a stinking political experiment in human slavery called "socialism" and present Indian govt supported by them easily give in to these fools.

I am sure that next 4-5 yrs we will see the ill effects on economic and international relations front of the policies pursued by this govt. GDP growth rate will slow down and infrastructure bottlenecks will further curb the growth, public sectors will continue to bleed and it will take years for the new govt (if these fools loose the elections) to get rid of the grandiose populist schemes like "employment guarantee scheme" etc that which is a way to loot the tax payers money.

Take away for ITO BPO Companies

News of economic slowdown in US and all other news pertaining to economy in US and elsewhere is an indicator that wealth creation is not going to be limited to some pockets of the world but will happen in many other parts of the world like China, India, Brazil eastern European countries and erstwhile socialist/communist states which were in past shackled by inward economic policies. Growth of internet and internet economy will also spawn net-economy.

Though all businesses needs to take cognizance of the these changes but I will like to restrict this post to what these changes imply for IT/BPO companies who have till now focused on North America and to a lesser extent on Europe as their primary market.

Past to current

- All the IT/BPO companies based their business model on typical "american" customer and created delivery models and offerings around it. Ascent was given to cost reduction by leveraging labor arbitrage and taking traditional outsourcing models to offshore delivery models. Some even called this model "Global delivery model", which I believe is a flawed definition as the model was created with "American" enterprise in picture and with American labor cost as a major driver

Emerging World

- This model restricts competitiveness of traditional IT/BPO companies to provide differentiated services in emerging economies like China and India where labor arbitrage cannot be a driver. Over and above the service lines and areas of competencies of incumbent IT/BPO service firms may find very few customers in these regions

- Many other industries like automobiles and consumer and electronic products are quick to realize the market potential in these economies and have aligned their supply chain, marketing and value chain to tap the potential in these markets. Some of them have successfully realized the differences and have setup shops here. IT/BPO companies are still grappling with fundamental question of what value proposition to offer to customers in this region and have either adopted a cookie cutter approach or have completely ignored these markets, I should say at their own peril.

- It will be a challenge for these companies to de-construct their existing business framework to come up with a viable value proposition. The current model is about large campuses housing thousands of people to operate huge back offices. Labor arbitrage (even now) provides enough margin for these players to invest on expensive infrastructure and huge salaries for people doing simple tasks. This model will never offer a viable service option to businesses in emerging economies and they are better off keeping their value chain in-sourced

Taslima and Indian Govt

It seems that there is no distinction between Pakistan, Bangladesh and India, all being held in sway by Islamic fundamentalist. It would make sense for Pak and Bangladesh, given that after systematic “cleansing” there are just muslims left in those 2 countries, but India with a majority “kafir” population acting like a radicalized Islamic state would baffle many.

This opinion has been further consolidated after Indian govt’s (headed by Manmohan Singh symbolically but run by Sonia in reality) decision to oppose French Govt’s decision to honour Taslima Nasreem for her literary achievements.

It is utterly disgusting and insulting for Indians and specially non muslim Indians that they have to tolerate Islamic fundamentalism practiced by state. I strongly believe that Singh and his govt is paving way for “Talibanization” of India state supported enthusiastically by communist cohorts.

I believe every Indian worth their salt should come out strongly against this and as a starting point vote these proxy “taliban” out of power next time round and bring in more stable and balanced party back in power