Archive for October, 2009

Software Services Organizations calling Mother Earth – “Houston, We have a Problem!”

October 24, 2009

It is now more than 4 years that I have been part of Software Services Industry (focused on providing IT/Software outsourcing solutions) after all my previous association with mostly product organizations – big and small. It has been an interesting experience for me – especially considering that my job (at GlobalLogic – focused on Outsourced Product Development business) requires me to play a role across Strategy, Business Development, Sales, and Delivery all throughout the years. Compared to many others in the Software Services Business – some might consider me as a relatively late entrant. However, these 4 years itself has given me enough perspective to think sincerely as to where this industry is going, what is working for them and what ails them too.

Now with lots of personal experience, after talking with many who have been part-of or have been associated in various capacities with Software Services companies, and scanning the internet for software/economic trends – I think I have started reaching some core prognosis and hypothesis for the state of software services industry. As one of the crew member in this software services industry spaceship I am now ready to acknowledge –  “Houston, We have a Problem!“.

Before I proceed further, please note that my prognosis is not about a dooms-day scenario but about certain ills which if not addressed soon can possibly adversely affect the long term growth of software services industry.

Here are some of the challenges which I am seeing that software services organizations are facing from a global business perspective -

  • Cost arbitrage is no longer the differentiator – Regardless of what many say – ability to help customers bring their costs/expenses down and at the same time scale too is of big value and will continue to remain so. So services organization providing any offering (while maintaining other attributes like quality, reliability, etc. constant) which successfully demonstrates this will always be attractive. However,  there is always a lower limit beyond which the costs cannot be reduced. Entry points for other competitors to claim that they can provide better cost-arbitrage value is relatively very easy. So for organizations for whom cost arbitrage was the only value proposition they could offer for years – world is now catching up fast with them.
  • Cost Arbitrage‘ and ‘Value‘ are like oil in water. They do not mix! – Having realized the above challenge – many services organizations have now seriously putting in efforts to provide their customers value-added offerings beyond just cost-based offerings. Value added offerings are typically based on specialized skills, domains, business partnerships, etc. However, while there might be few cases of successes in this way, my personal opinion is that majority will have a challenge selling ‘value’ to their customers along with cost arbitrage solutions. Providing cost arbitrage and also providing value are inherently conflicting offerings. (Anyone who has read my previous blog post – “Psychology of Consumers During Consumption of Products or Services” and the associated article would probably agree with my view point).
  • Need to shed away inward focus – Considering the nature of the business (especially when the focus is more on Point # 1 which I listed above) – substantial portion of services organizations efforts and energy is increasingly focused internally to manage people, salaries, delivery, costs, lunches, operations, personal aspirations, etc. assuming that this is key to their bread and butter. Very crudely, I would compare this to the day-in-the-life of a shepherd managing his herd of sheep. Ratio of number of people focusing on internal operations to number of people interacting with the external market/business has to reverse in Services Organizations.
  • We cannot keep just consuming, we need to produce too! – Substantial number of Software Services organizations (including where I am employed) have been in business for long period of time and majority of them today can boast of servicing huge number of businesses / products / domains / technologies under one roof. InnovationOver the years majority of the services companies have done this by ‘consuming‘ knowledge / experiences / technologies / best practices produced by someone ‘not‘ under their roof. I am not saying this is wrong or bad. However, I am also assuming that with the years of experience under their belt now (again across domains, technologies, best practices, etc.) – software services organizations should be in much better situation to contribute back new discoveries/inventions/practices, etc. to the industry. We need to ‘produce‘ too! So I will confess here that in the day-to-day tactical efforts to manage points listed above, majority of services organizations are not able to properly concentrate on this count.
  • Surely, we will get recognized by the company we keep; but we will finally get valued by the work we do! – Take a random survey of the Software Services Organization portfolio and look at how many of them claim that they work for a ‘Microsoft’ or a ‘Oracle’ or a ‘Cisco’. More than half of the thousands of Software Services Organizations would (honestly) claim that they do. Without any doubt that is the first big achievement. Now find out how many of these organizations do the Microsofts or the Oracles of the world acknowledge in their products that it was built with these organization’s help. Getting recognized or people knowing about us is one thing, but people acknowledging us as a thought leader is completely different matter. IMHO, majority of the Services Organizations still have to cross that bridge.
  • and finally – focus on building the Taj Mahal, not the number of people billed to build the Taj Mahal – Perhaps slightly related to above point but a different perspective! Almost all of the customers of the Software Services organizations are focused on building something which they strongly believe would be the next Taj Mahal. Special, different, beautiful, strong, ever-lasting, etc.! The focus of organizations like mine should be on that. The number of people or hours billed in a billing cycle – though important – is a temporary thing and will eventually get replaced from the records with the change in the financial cycle, but if we can help an organization to be the next Cisco – the returns are going to be far better.

My intention in this blog post is not to crucify anyone or any particular organization, but to point out few things to correct the course. And this case, I am pointing these things out to the organizations which I am happily part of. Like in any retrospection along with an introspection discussion, I am possibly expecting a polarizing reaction from readers to my blog post. However, the key for me here is to start the debate and hear your view points. So let the comments/feedback/fires flow in.

Healthcare System in India seems to be at a crossroad!

October 14, 2009

Over the last few months, I have had an opportunity to present my thoughts/views on the state of Healthcare Services in India in different types of people settings – big and small/formal and informal – including the one which I described in my previous blog post.

At a crossroad

At a crossroad

Based on my observations and my views (and after validation from various different sources), I had mentioned that I sincerely felt Healthcare Services in India is at a crossroad in its phases of evolution. Many had asked me why I felt that way. To explain my reasonings and arguments for such observations is the motivation behind writing this post.

Before I make my case, I hope you have had an opportunity to read various of my other previous blog posts about Healthcare in India. Hopefully, after reading those you would have realized that I am no medical practitioner nor do I have any association with any policy making organization. My views are more from my observations and experiences from Healthcare Consumer perspective.

Being at a crossroad’ for me means that the contrasts between the state of various things or options starts becoming so evident that people dealing with it (be it individuals or society or a country) have to very often face or deal with options and associated consequences of each option. In some sense it is about making a selection which potentially would determine the direction in which we as individuals or society would go. In the healthcare case, in some symbolic sense, I felt that the state of matters or the options provided by the Indian Healthcare Services seems to have started showing various different signs of contrasts. Hence my argument for Healthcare Services being at the crossroad!

Components of Healthcare System

Components of Healthcare System

To look at the contrasts one has to have an objective view. A view from a 10000 feet! From such a high view, IMO, if we were to look at the ‘state-of-the-union‘ of the healthcare system – I felt that we can see distinct two categories – the ‘good news‘ category and the ‘bad news‘ category. The ‘good news‘ bucket has the real progress which the country has made in comparison with the previous decade/s. And the ‘bad news‘ category contains the increasing developments which in some sense the dampens the ‘good news‘ category.

When you look at the baggage which India carries (over-population, years of apathy towards infrastructure development, traditional social lack of awareness towards health management, etc.)  and then put things into perspective – one cannot miss out the noticeable growth and progress being made in the last decade in the area of Healthcare. And it is continuing. At a national level, India is among the top contender for the destination in the area of Medical Tourism.

Medical Tourism Booming

Medical Tourism Booming

If I were to look at the local level – especially at my home town – the medical specialists and the treatments which were only available after traveling more than 400 miles to the West, is now available within miles. Indian Medical System seems to have gotten into a factory-like approach in churning out specialists in a recurring way.  The private hospital chains (Apollo‘s, Max‘s of India) seems to have started taking steps in providing healthcare management facilities (although still affordable to a subset of the population) which even the respected Government-run medical hospitals (AIIMS, KEM, etc.) seemed to have ignored over the years. Recent news about Max investing in Electronic Health Records (EHR) mechanisms or Apollo venturing into advisory services in helping other nations to open up the hospitals are some big validations of the progress. Investments in this field are coming from all corners with McKinsey predicting that the Indian Healthcare market would grow to about $52 billion in 2012 (from the current $35 billion) and to about $150 billion in the year 2017.

Spinning the Money

Spinning the Money

Indian government (possibly under pressure from World Health Organization too) have been increasing the number of medical colleges by more than 12-15% year-by-year since the last few years. Increasing population, increasing income, increasing reporting of medical ailments can only be good news to any investor (pun intended!). So in a sense there is a big air of optimism around which one can certainly feel if one looks around.

India Short of 6 Lakh Doctors

India Short of 6 Lakh Doctors

However along with the above sense of progress there are also instances or developments which are so visible around which makes one think that many things are also ain’t going the right way from the healthcare perspective in India.

Basic Doctor Mistakes

Basic Doctor Mistakes

Progress made in the healthcare options is not yet reaching to all in the society at the pace it should ideally be. 80% of the Healthcare providers and specialists are concentrating on the 20% demography located in the urban areas (hence the rural areas continue to suffer). Common basic mistakes in medical treatments which probably would be synonymous to the state of medical system in a third-world country are still being made (e.g. babies being declared dead only to found alive after couple of hours, incidences of some doctors refusing to treat HIV patients because of social taboos, etc.).

Indian Medical Journal of Medical Ethics

Indian Medical Journal of Medical Ethics

The relationship between the doctors and the patients have increasingly started coming under big strain (both ways) with increasing number of incidences where law-of-the-land have been broken by either parties.

Doctors protesting

Doctors protesting

Cases of medical malpractices which frequently comes to the fore typically leaves a stink and big blot with the progress. Accountability is a key component in any progressive system and Indian healthcare system continues to lack in that to a big extent. My personal confidence in the maturity of the Indian Healthcare system maturity also got shaken when I read that Indian Medical Association (IMA) itself came forward and said that they have lost track of number of doctors in the country in the recent years. I had also recently blogged about my apprehensions of the Indian Healthcare System during the H1N1 outbreak few months back.

More afraid of medical errors

More afraid of medical errors

I am not sure how many of you have also noticed this contrast the way I am seeing it. Please do not get me wrong here. My intention is not to paint a black or a white picture here. In my conversations with many on this topic – that is lot of contrasting opinions out there about the state of the things. And hence the extra motivation to my point of this post. Because of such visible contrast, my opinion is that India’s Healthcare System is at a critical crossroad as it continues to evolve fast. The steps it takes in the next few years would determine its long-term success. But the good news is also that such contrasts opens up lots of new opportunities too.

Your thoughts and comments are welcome.

[Startup Saturday – Delhi] Healthcare in India – Consumer Perspective

October 12, 2009

This weekend on Saturday, I presented a talk titled – “Healthcare in India – Consumer Perspective – Opportunities!” at Startup Saturday – New Delhi. The talk was more about my thoughts on what kinds of healthcare opportunities from the consumer perspective exist or will exist in India. Many of the attendees (and also some who missed the talk) requested me for the slide deck. For them I am putting it here.

(Does not seem like SlideShare did a great job in properly converting the ppt. Please feel free to reach out to me in case you have questions on anything specific)

For those who missed it out – it was fun talking in front of the lively audience with many questions and strong view points. Some key highlights of the questions/discussion points -

  • There was a lot of debate on my “Good News” and “Bad News” slide and why I felt about it in that way. I will be putting my thoughts on it in a separate blog post.
  • Interesting debate when I said that India was a Developed country. (Needed help from the politicians there)
  • Few misunderstood that I was encouraging opportunities for replacing the doctors. No folks! Doctors cannot be replaced! Few in my own family would have killed me if I had that view.
  • Many felt that the healthcare domain was difficult to crack considering the insufficient domain knowledge they had. My suggestion to the wanna-be entrepreneurs was not to build any solutions by excluding the doctors.

Look forward to hearing your thoughts and/or views too!

Beyond the hype – can some real work using Cloud Computing start now?

October 1, 2009

Few months back in the month of June, I had wailed against the increasing marketing hype and the resulting over-expectations set on Cloud Computing which IMO is a powerful concept but yet is still at its nascent stage. (read my blog post titled “Cloud Computing – Is this the case study for Marketing gone out of hand?“). Then in the very next month of July, Gartner came out with their much anticipated annual “Gartner’s Hype Cycle Special Report for 2009” which in some subtle way examines the maturity of emerging technologies.

(For those unfamiliar with what Hype Cycle means, you may want to refer to this Wikipedia description. Coined by Gartner, the Hype Cycle hypothesizes that any emerging technology typically goes through an initial period of over-enthusiasm and popularity which in some sense results in inflated expectations from the emerging technology. After this initial period, the hype around this emerging technology typically falls possibly because of  disenchantment. Few technologies recover from this phase of disenchantment with a practicality/sanity of usage taking over.)

As the 2009 Hype curve shows below – Gartner feels that Cloud Computing has now reached the peak of the hype cycle and based on their theory it many now be entering into the depths of disenchantment.

2009 - Gartner Hype Cycle

2009 - Gartner Hype Cycle (Source: Gartner)

Personally, I usually take any of the Gartner data with lots of salt and many a times also have ended up pondering upon their validity. However in this case I would seriously like to believe (or like to pray) that they are right especially in their assumptions about Cloud Computing. Because if they are – I am betting that the real work with proper practical expectations using Cloud Computing would start now. This is the time when many of its potential users would try to cipher through the confusing hype; take baby and practical steps in its adaptation; and let the top spin to see how its application spans out for their needs.

Going forward beyond the peak of the hype, as I am looking into my crystal ball – I am predicting that the usage/adaption of Cloud Computing across products or IT infrastructure would go through the following five stages (see figure below). My assumption of these five stages are derived from what I have typically seen how many other technologies/business processes (e.g. IP Telephony, Enterprise Automation, etc.) have found their way to mass/mature adaption. Note that in the figure below, the curved blue line in the backdrop indicates the Gartner Hype Curve.

Beyond Hype – Predictions about Cloud Computing Adaptations

Beyond Hype – Predictions about Cloud Computing Adaptations

To describe these stages in more details -

  1. Adaption Phase - This phase (and we are well into this phase from Cloud Computing perspective as we speak) is where organizations would start taking the initial steps in looking at the application of Cloud Computing paradigm within their products or infrastructure. Products/applications hosted on traditional infrastructure are getting moved on Public Cloud. SaaS-enablement of existing products is another example. Using Virtualization to create in-house Cloud environment is another activity which many organizations are seriously looking at or many have also started implementing.
  2. Stabilization Phase - As with the adaption of any new technology, the teething problems would need to be overcomed. This is the phase where the myths/hypes/over-expectations associated with the technology would meet with the real-world realities. Various risks associated with the new adaptation would start cropping up and would need to start getting mitigated. To do this certain applications would have to be re-architected; existing business processes would need to be remodeled to find a win-win situations with the business needs and advantages which the Cloud Computing platforms would possibly bring in. I personally believe that this phase would be the most critical of all. Adaptations of many new technologies have struggled in the past in this phase for a long periods and sometimes resulting in the ball getting completely dropped altogether too. From Cloud Computing perspective, I am predicting that the concept itself is going to evolve a lot as organizations go through this phase.
  3. Measurement Phase - Once the adaptation and implementation of any technology stabilizes within any product or organization – the natural next step is to start measuring the day-to-day health and throughput. This is the stage where the Service Level Agreements (SLA) definitions and its measurements is going to start becoming important (as compared to usage of SLAs in the previous stages). At this stage, the measurements associated with uptime, disaster recovery, scalability, response time, etc. would start giving an idea about how well the implementation of Cloud Computing has gone.
  4. Optimization Phase - Measurements would naturally lead to optimization of the implementation – be it from an architecture perspective or simply from the basic notion of how Cloud Computing should continued to be used. It would be too presumptuous of me (or anyone else for that matter) to start predicting how the optimization would play out for Cloud Computing today. It is just too difficult to predict today. However, like all technologies, cloud computing would evolve heavily (for better) in this particular phase.
  5. Management Phase – This is the final phase where success stories associated with successful Cloud Computing implementations would start becoming a regular norm. At and beyond this stage, the implementations of Cloud Computing would continue to focus on regular Management which would include activities such as coordination, reducing regular expenditure, productivity improvement, improving functional statuses and satisfaction.

Please note that I am not suggesting that the above phases are always going to sequential; however it is more from lines of trying to figure out the order of the stages of implementation or even the maturity of the implementation. For example, it certainly does not make any sense to start measuring SLAs even before the implementation has stabilized. In void of such staged approach, I have seen that many a times many false results can dampen the potential which a new technology or paradigm can possibly bring in. And as I have said it before, Cloud Computing is certainly one such powerful platform. However, as many of you would agree with me that even a powerful platform can render itself ineffective if not implemented in a proper manner.

Would love to hear your thoughts/comments.


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