The Journey From Services To IP?

Made In Indian IT Service IndustryThe Indian IT Services industry has been one of the wonders of the world over the last couple of decades, growing from nothing to $100 Billion in that time. However, today, the industry seems to be caught-up in it’s own success. With the loss of the cost play as a long term strategy, and the movement of the IT landscape towards everything on the cloud (the conclusions in this article by  are a bit drastic, IMHO, but the points are valid), the industry needs to have a long hard look at what the future holds.

A recent event report by Ray Wang that talked about IP motivated me to flesh out my thoughts on this topic. Over the past few years, this has been an oft-repeated discussion with folks at multiple firms (mostly within the BFSI sector) with interesting thought patterns emerging.

There is a large amount of trepidation in these firms with regards to creating intellectual property. The few internally developed products have not provided the returns. Even the ones purchased externally are not hitting headlines. The ROI has just not compared with the returns coming from services making it a low priority in tough times. There is also concern about competing with the customer (the customer would not want to pass knowhow which could end up in the vendors own products). The firms just don’t seem to trust their knowledge levels, execution capability and selling skills enough.

To get around this, the vendors need to think outside the box.

One feature of enterprise software (especially internal software, which is bread and butter for the service industry) is the utter lack of thought put into user experience, and to an extent, sustainable design. Zia Patel has eloquently talked about how India can capitalize on its back room innovation skills to create IP. This niche can then be exploited by the industry to create a differentiation to their services as well as products.

Another thought is to work with the startups in India. I know of several startups which began with product roadmaps. To fund these fruits of passion, they began to do services. Now they are in the “next payroll syndrome” and are unable/unwilling to chase their dreams. With their strong balance sheets, the large companies can create an eco-system of co-dependency that will help both ends of the market. There is a start in this area, but I am still not sure that the needed focus has been brought yet.

In summation, the industry needs to start looking at the future much harder than it is today. Yes, it needs to build up strong expertise across verticals and it needs to ensure that the relationships are created and nurtured. But, that is now a basic requirement, not an objective. As for the individual firms, they tend to follow each other, which reduces the chances of any real innovation happening in the industry.

Its time for the individual firms to stop focusing on each other and start focusing on themselves. What do the 9-to-whatevers think?

Advertisements

Do We Want to Know?

Knowledge Management is everywhere. In discussions, blogs, corporate strategies, individual minds, etc. If one is unaware of or not convinced about the benefits, there is an army of consultants and vendors who can change that. I am a convert without needing any more help.

For evidence, one needs only to look at traditions passed from one generation to the next. The artisan/farmer/xyz made sure that the next generation understood and learnt the sum of their knowledge so that it may be built upon and improved. This was actually necessary for survival. Today, organizations are fighting for survival/success in a way they have probably never fought before. Every asset is being analyzed in order to increase the efficiency of usage. Knowledge is one such asset which is underutilized and can provide significant returns. The question then is, why is knowledge underutilized? To use any asset efficiently, the nature of the asset needs to be understood; the asset transformed to be usable in the manner desired; the asset used in an optimal manner; the asset maintained in a usable/relevant state and measurements of the benefits coming out of this. Let us apply this to knowledge.

The nature of “knowledge” has been well studied and classified and is constantly being refined. Most of the literature I read today relates to the transformation of knowledge into a usable state. Tools to capture explicit knowledge are widely available. There is also good direction on how to start capturing implicit knowledge; direct interaction and collaboration between the haves and have-nots being used to speed up this process. Curation and maintenance of this “library” is also an oft-touched upon topic. But what about the users of this knowledge? When there is a need for context based answers (typically quick problem-solving type things), people do approach other people. However, a large part of the problem is around re-inventing the wheel and re-learning lessons. My experience has shown me that the not built here syndrome continues to exist in this space. Large swathes of the organization (including and specially managers) do not believe that solutions created and lessons learnt by other people apply to them. Their problem is always different. (Code re-use & Service re-use anybody?). What is done to change this attitude will decide the pay-off from any KM strategy. Another issue is training. While internal corporate providers can play a just in time game with knowledge, vendor organizations and service providers need to be on the bleeding edge. They need to prepare people with knowledge in expectation of its use, not after they develop a need.

I have seen multiple organizations repeat mistakes or re-invent things because people do not want to talk to the people with the knowledge. I have also seen different groups at different levels of preparedness with knowledge (within and across organizations) which they know will be needed. Unfortunately, this depends on the attitude of individuals. We need to work on the culture to spread the “correct” version of the attitude.

We know that Po’s father would confide the secret ingredient to him at some point. But, we need the whole organizational kitchen to know it. What can be done to make it happen? Any thoughts from the 9-to-whatevers?