TCS IPO, facts and figures

The Kumbhakaran of the Indian IT industry woke up in 2004, ending speculations about an impending IPO. The IPO put the stock markets in a tizzy and established TCS as a public limited company. I have collected some facts and figures about the IPO.
Need for the IPO

1. To change TCS's image from a division of a private firm to a globally driven, independent organization.
2. To provide Tata Sons with the monetary muscles for new acquisitions.
3. To provide greater agility to TCS in a dynamic market.

Why now
There is no clear cut explanation as to why TCS chose to go public now and not in 2000, when it would have been valued at least three times more than it is valued now. Some people claim disinterest from the senior management. An example would be TCS's ex- CEO FC Kohli saying "If we go public, the employees would be talking only about share values since morning,".Another reason might have been that TCS never felt the need to go public, as it had sufficient cash reserves, and could finance all its acquisitions by itself. A alternate explanation states that TCS being the biggest contributor to the coffers of Tata Sons, was crucial to the acquisitions and new ventures of the holding company.
Financial Highlights
TCS's revenues rose in 2001-2002 by 32.7% and in 2002-2003 by 20.2%. The sales in 2002-2003 were 5007 crores.
IPO Highlights

1. Book building opened on July 29th and closed on August 5th.
2. 5.54 crore equity shares of Re 1 each on offer.
3. 60% reserved for QIB, 25% for retail investors and the rest for non-institutional investors.
4. Price of 850 fixed.
5. IPO oversubscribed 7.7 times.
6. Raised about 5500 crores from the market.

Temple Management

This weekend I and Priya decided to take a bike ride to Chilkoor, a temple on the boundary of the Gandipet reservoir. We started out at 9:00 in the morning and after driving about 25 kilometers through idyllic suburbs, we reached Chilkoor. True to the reputation of any public place in India, the temple was crawling with devotees. There were people there from all walks of life. People in big cars, people on bikes and people who had availed public transportation to get to the temple. The entire economy of the place seemed to have evolved around the temple. There were local youths engaged as parking attendants, meticulously noting down the numbers of all vehicles that entered the lot, and issuing parking tickets after the payment of a modest amount of two rupees. Waiting immediately outside the parking lot was a curious mix of children and adults, shouting unintelligible sales pitches in Telugu. It took them about a minute to realize that we were not locals and out of the crowd a man emerged, shouting to us in Hindi why we should buy the offerings for the Lord from his stall. The deal was that if we bought offerings (2 cocunuts and two garlands) from his stall, he would look after our footwear free of charge. To the uninitiated, most Hindu temples do not allow footwear on their premises. They usually have footwear attendants who look after your footwear in return of a small amount that goes to the coffers of the temple trust. The man charged us rupees thirty for a offering and gave directions as to how we could enter the temple and how we could locate his stall from the temple exit, which was on the other side of the entrance. There were at least two dozen other such small stalls in a row, that sold offerings and acted as guardians of footwear for the devotees. The footwear issue now settled, we decided to enter the temple. The first thing that greeted us when we entered was the coconut cracking platform. It was a granite basin with sharp edges where the devotees were supposed to crack the first of their coconuts. On cracking a coconut, half of it is retained by the devotee and the other half goes to the temple management as offerings to the Lord. There were people with baskets waiting to collect the other half of the cocunut. A filled basket is expertly whisked across a wall and sent to the interiors of the temple. Finally we got to the heart of the temple. The sight that greeted us was nothing short of spectacular. There was an open courtyard about 40m x 40m. There were about 500 devotees, half of them queued up neatly to do the Darshan (seeing the Lord's idol) and the other half making rounds of the idol chamber. Without much ado, we joined the tail of the queue. The queue had three layers, entwined around the idol chamber. One surprising thing was that, in the two hours or so that I was in the temple, the queue never grew to more than three layers. The design of the queuing system looked evolutionary and therefore was a higly accurate model of the number of people it would serve on any given day. The entire courtyard was monitored using CCTV, and the feeds were checked by temple attendants constantly. Another useful innovation that was implemented at the temple was a round-counting ticket that was available on the payment of a token amount. The ticket is used by devotees doing rounds of the idol chamber (108), and is very handy for keeping track of the number of rounds completed so far. By the time we got to see the Lord, we had been in queue for nearly half an hour. There was a minder near the idol, who was constantly urging devotees to move on, after they had taken a peek at the Lord. Each devotee gets to see the Lords face for about 15 seconds. Surprisingly there were no delays or gluts at the head of the queue, inspite of the large number of devotees. All this motioned to the existence of very effective evolutionary designs in management of a large number of people. The entire system of the temple was optimised for just one purpose, providing a safe and hassle-free spiritual experience. Now imagine a supermarket single server queue and imagine 250 people queued up to check their purchases out. The confusion that would arise out of such a situation would be harrowing. Also notable was the fusion of modern technology with time tested methods for queue management. The temple management projected themselves as people who are constantly learning new ways to make the entire system more effective and hassle-free for the devotees. India is a land of temples. There are approximately two thousand temples listed on Templenet. The more popular ones sometimes get 1 lakh footfalls on auspicious days. Now imagine a popular mall recieving one lakh footfalls someday. The entire system would be thrown out of gear. There would be utter chaos. But, temples can easily handle such huge crowds, without any discomfit to the public. The way they do that is by fine tuning their operations to the best extent possible. Their ultimate aim is to expedite the spiritual experience without causing any discomfit to the public. Obviously, the larger the number of footfalls in a day, the larger the donations made to the temple Hundi. Monetary implications such as these encourage temple trusts to optimise their processes to allow for greater footfalls. So, why not introduce a course on Temple Management. Temples are big business and all big businesses require competent managers. Also there are definitely lessons to learn in management of temples which could be applied to domains such as retailing. When courses such as Agri-Business Management and IT Management exist, why not a course on Temple Management. After all, spirituality is also an experience and therefore needs to be optimised. Then, we could have ISO 9001:2000 certified temples.

Swaminomics

Recall Swaminathan S Anklesaria Aiyar, the man behind tha fabled Swaminomics, the weekly columnist for Times of India. His column elucidates the most complex of economic theories into easily assimilated forms. Well, the guy has a website where he has kept all his articles that were ever published. Although some of the links are dead, the archive is a treasure for anyone who wants to browse through social, economic and political issues faced by our nation for the past 12 years. Kudos to you Mr. Aiyar and keep up the good work. http://www.swaminomics.org/default.htm

Golconda

Last weekend, I and Priya and Ritu and Anoop rode out to Golconda. Golconda is a magnificient fortress built on a solid granite foundation, by the Qutub Shahi Kings around the 15th century A.D. The fortress is a architectural accomplishment and imbibes in it the best of Hindu and Islamic architecture. Here is a list of snaps from the trip. Stony path to the entrance
Full frontal
The entrance to the clapping portico
Medieval morgue
Sunlit interior
Barracks.
The largest of the three water tanks
The steep climb
Vertical limit
Sculpture by Ramdass, incarcerated in Golconda for 14 years.
Panoramic view of city from the front.
The people's mosque. Notice the fusion of Islamic and Hindu architecture.
The Kali temple. Probably the oldest piece of architecture (13th century)
Panoramic view at the back
Sunset at Golconda.
The darbar(courtroom) at the top.
Going down, down, down.

The Barbecue Story

Herez an article I wrote for Vibeindia
The Barbecue Story

The Andamans

Here are a few facts about the Andaman and Nicobar Islands:
Geography
These are a group of 572 Islands located in the Bay Of Bengal. They lie in an arc covering a north-south distance of approximately 800 kilometers. They are divided into two groups, the Andamans and the Nicobars, seperated by the Ten Degree Channel. Port Blair the capital of the archipelago is located in the South Andamans. There are two districts, Andaman and Nicobar.
Demography
The total population of the Islands is 3,56,000 according to the 2001 census. Of this 2/3rd is rural. The sex ratio is 1.18:1. The islands are Hindu dominated with a substantial Christian population. The literacy rate is high at 81%. The net per capita income is around 24,000 INR.

VAT of contention

VAT has been one topic that is doing the rounds in most of the nation's media. I have collected a series of links that demystify VAT and bring it in perspective.
What and Why VAT?
Who benefits from VAT
How does VAT work?
Bye, bye sales tax; VAT's here

Smallville

I have been a small towner probably most of my life. I had my entire schooling in Port Blair, a town with a population of about 1.5 lakh. I recieved my undergrad education at REC Silchar. Silchar is a small, laid-back town in lower Assam. I sometimes start wondering about the influence my small town background has on my personality and how it has moulded me into the person I am today. Probably the single most important lesson a small town background teaches you is respect for what you have and that brings in you the drive to go for things you feel you have been deprived of all your life. During my school days in Port Blair, I had this irresistible urge to read books. I first started reading all the fiction that my school library could offer. Once I was done with my school library books, I moved on to probably the largest repository of books in Port Blair, the state library. After I had finished with all titles by my favorite authors there, all I could do was read them again and again. Port Blair was a place where one could not buy books even if he wanted to. There was no bookshop where one could go and buy books. This probably made me realise that books are a luxury in many parts of India and when one can lay hands on some, its prudent to make the best of them. In my opinion a small town background teaches you tolerance of other people and customs. I know this sounds contrary to logic. After all a cosmopolitan megacity would be an ideal place to learn tolerance, with people from all communities and cultures etching to make a living. But what I felt was that big cities teach you to neglect rather than tolerate. People are so hurried that they gloss over any anomaly that they encounter. In small towns the interaction with people from other backgrounds is more personal. It takes the form of family visits and marriage ceremonies. I attribute the tolerance in my persona to my small town background.

Product Development Life Cycle

There are a nunber of methodologies that are in use for product development. I have tried to summarize the most prominent methodologies in use and their salient features. Later I try to identify the methodology that we followed while developing Tata Bio-Suite. There are certain commonalities between all these methods. I have also listed them separately.

Market Survey and Analysis

This is carried out before any work on the product is started. The aim of carrying out a market survey is to identify the need of the proposed product in a target population and also to study competitive products already in the market. The market study is based on a lot of assumptions and the accuracy of these assumptions is crucial to the success of the product.

Research

This includes literature survey and pseudocoding. In this phase a team of people, usually domain experts, study the domain in depth and come up with a list of features the product would provide. They also go through literature and come up with algorithms that would be used to implement those features. The aim here is to come up with solutions that satisfy the customer's needs better than competitors. At the end of this phase the team comes up with conceptual or actual prototypes that are then used by the development team to build the actual product.

System Development

There are a variety of methods that can be employed at this phase. The prominent being

• Linear Model

• Prototyping Model

• Rapid Application Development Model (RAD)

Linear Model

This is perhaps the simplest model in use for system development. The following are the prominent steps used in this model.

• Requirements Analysis

• System Design

• Code Generation

• Testing

• Maintenance

Prototyping Model

This is a cyclic version of the linear model. In this model, once the requirement analysis is done and the design for a prototype is made, the development process gets started. Once the prototype is created, it is given to the customer for evaluation. The customer tests the package and gives her feed back to the developer who refines the product according to the customer's exact expectation. After a finite number of iterations, the final software package is given to the customer.

RAD Model

The RAD is a linear sequential software development process that emphasizes an extremely short development cycle. The RAD software model is a "high speed" adaptation of the linear sequential model in which rapid development is achieved by using a component-based construction approach. Used primarily for information systems applications, the RAD approach encompasses the following phases:

• Business Modeling

• Data Modeling

• Process Modeling

• Application Generation

• Testing and Turnover

Design of Tata Bio-Suite

We followed a prototyping based approach while developing Bio-Suite. Starting from version 0.3, the prototype was sent to partners for testing. After the feedback of the partners was received and incorporated into the product, a newer version would be released. This cycle continued till version 1.0 was released. After this the product entered the maintenance phase.

TRIPS and the Pharma Sector

In this post I plan to deal with issues of TRIPS implementation in India and issues facing pharma companies post-TRIPS.
The Crux Of the Issue

The Indian govt. agrees to enforce TRIPS by 2005. Indian pharma industry has grown by almost 30% for the past few years. At S$13.6 billion it is the third largest in the world in terms of volume. It is 13th in the world in terms of value. By reverse engineering patented drugs and then manufacturing them using very cost effective processes the Indian companies have brought down end user costs dramatically. Their market share in the domestic market has risen from under 30% to over 72% in the past thirty years. They now import generic drugs to a large portion of the third world countries. TRIPS implementation in India would mean that the patent holding companies would retain exclusive marketing rights over locally manufactured or imported drugs. They could also keep production down to increase prices. This would sound a death knell to domestic drug manufacturers who would no longer be able able to manufacture and market the patented drugs. This may also mean increased drug costs to poor third world populations.
What can the Indian companies do
They can push for compulsary licensing. Compulsory licensing would imply that any company would have the right to manufacture a generic (non-branded) version of the drug, provided it pays the patent holder a royalty. It would also allow Indian companies to export much-needed patented drugs to the less developed countries which need them but don't have manufacturing facilities. The other alternative is to increase R&D spending to compete with western drug manufacturers. This they can do by utilising the cheap and skilled manpower that is available in India.
Links
Yale Global The Economist

Computer Aided Drug Design and Pharma Industry

This post is intended to justify use of Computer Aided Drug Design methodologies for accelarating the drug discovery processes of the pharma industry.
Phases in Drug Discovery

• Pre-Clinical Research

This includes synthesis, purification and animal testing.

• Phase I Clinical Trials

Phase I studies may be conducted in patients, but typically involve healthy volunteer subjects. These studies are designed to determine the pharmacokinetic (how the drug is absorbed, distributed, metabolized, and excreted by the body) and pharmacologic (the effect of the drug on the body) actions of the drug in humans, the side effects associated with increasing doses, and, if possible, early evidence on effectiveness.

• Phase II Clinical Trials

Phase II studies are designed to obtain data on the effectiveness of the drug for a particular indication or indications in patients with the disease or condition. They also help determine the common short-term side effects and risks associated with the drug. Phase II studies are closely monitored and conducted in a relatively small number of patients.

• Phase III Clinical Trials

Phase III studies are expanded controlled and uncontrolled trials. They are done to gain additional data about effectiveness and safety needed to evaluate the benefits and risks of the drug. Results from Phase III studies also yield data that will provide the information that eventually will go on physician labeling.

Facts

• Cost of developing a new drug in 1979 was $54mn, in 1991 it was $231mn and in 2001 it was $802mn.

• It takes between 10 and 15 years to develop a new prescription medicine and win approval to market it in the United States.

• Had costs increased at the pace of inflation, the average cost of new drug development would have risen from $231 million in 1987 dollars to $318 million in 2000 dollars.

• The full capitalized resource cost of new drug development was estimated to be $802 million (2000 dollars). This estimate accounts for the cost of failures, including research on compounds abandoned during development, as well as opportunity costs of incurring R&D expenditures before earning any returns.

• When compared to the results for previous similar studies, the R&D cost per approved new drug increased 2.5 times in inflation-adjusted terms.

• While costs have increased in inflation-adjusted terms for all R&D phases, the increases were particularly acute for the clinical period. The inflation-adjusted annual growth rate for capitalized clinical costs (11.8%) was more than five times greater than that for pre-clinical R&D.

Links

• CIO Speed - How IT and Pharma are merging
• Tufts Group

Phase III begins

As part of my interview prep I went through my 600 word essay and arrived upon a list of 24 questions that the adcom might quiz me on. I intend to be able to answer any of these questions at the drop of a hat. Subsequent posts will dwell on each of these questions.

Questions

1. How do you think the small town background differentiates you from the rest?

2. What do you mean by unique work experience?

3. Everyone claims to have a desire to contribute back to society. How are you different?

4. Tell us something about the Andaman and Nicobar Islands?

5. Tell us something about Assam?

6. What are the realities of life in these forgotten parts of India?

7. What do you mean by inclusive participation by industry? Give us some examples?

8. What is Bioinformatics?

9. Tell us something about Advanced Technology Center?

10. Tell us all you know about TCS?

11. Why do you think you were made a module lead, despite having lesser academic credentials and lesser work experience.?

12. What are the leadership and technical challenges you have talked about in your resume?

13. What are the various stages in the life cycle of a product? How is it different from a normal project?

14. How is computer aided drug design important to the pharma industry?

15. What are the WTO norms you are talking about and how will they affect the pharma industry in India?

16. What were your responsibilities as system administrator?

17. Which prospective clients did you negotiate with? What did you learn from the negotiations?

18. What does the FAPCCI award measure? What qualities in your product differentiate it from your competitors?

19. What is Technology Change Management? How is it implemented in TCS?

20. What were your experiences as Asst. Magazine Secretary of your college?

21. How do you plan to raise money for rehabilitation work? Have you decided howthis money should be used?

22. What do mean by a cross functional team? What was the objective of forming such a team?

23. Why did you spend three full years in the same project?

24. What do you think you would have learnt by being in an offshore project?

Father of Indian SW Industry

F.C. Kohli, father of the Indian IT industry and ex MD of TCS, spoke to us today. He narrated his experiences from his early days at TCS and then went on to make predictions about the future of the Indian IT industry. He placed a lot of stress on hardware and predicted that in ten years time India will have a hardware industry worth $100bn. Half of that amount would be generated by the local markets and the remaining half will be generated from exports. He stressed the importance of having more Microelectronic engineers in the country. He said that India only produces 250 microelectronic engineers now, and to have a robust hardware industry India needs 30000 engineers. All in all a very nice and enlightening talk. Sankha

ISB Application Submitted

YES! after several iterations through the write, review and refine cycle, I am finally done with my application process. I kindo enjoyed the whole thing. Applications such as these make one think through things. Tons of thanx to Krishna, Chaitanya and Dr. Vikram Raj. Thanx to Priya for going through half-done essays and coming up with useful suggestions. And above all thanx to Raj and Sita for the stellar recos. Submitted my application just three days short of the second deadline (15 Jan). Hope this doesnt send negative vibes to the adcom. Now begins the agonising wait. Waiting alone isnt going to take me places. I also have to prepare myself for the interview. I intend to go through my essays with a fine comb and prepare questions on each and every point that might be raised by the adcom. Wishing me all luck Me

The Great Indian Software Industry

Source : Dataquest India THE HOT VERTICALS: The Great Indian Software Revolution
From $12 million in 1980 to $9 billion in 2002—this long journey took some stumbling around and a lot of grit. This is the story of Indian software, one that’s never been told this way before
The software industry has come a long way. And like all big events of history, it happened part by design and part my accident. In the 70s, not many people in India understood the word "software" and there was no separate software industry. Throughout the 70s, multinationals like IBM and ICL (UK) were the largest providers of hardware to the industry—and it came bundled with the operating systems and a few basic packages. Larger enterprises—including the Indian defense and public sectors—which needed customized applications, had their own large EDP teams that did everything from installing systems to writing software.In fact, when specific software applications began to get popular, stand alone boxes were made for them. Few will remember now but at the Manufacturer’s CSI Exhibition in 1983, there were 21 different "word processing machines" on display. The concept of a standalone word processing software did not exist. Later, when local companies bloomed after IBM’s exit, they too had their own proprietary operating systems—which ran a few of their own programs.

SW exports: All a question of forex

At the time, software exports as a concept was still way below the horizon. Though India was among the first developing nations to recognize the importance of software, the key concern then was foreign exchange.

The nub was this—if companies wanted to export software, it had to be written on and designed for systems that were standard worldwide. That meant the most recent IBM systems. But IBM in India was selling old, refurbished and antiquated machines. Software exporters, therefore, needed to import specific hardware to be able to write software they could export. DoE grudgingly allowed exports—on the condition that the exporters recover twice the value of the foreign exchange spent on importing computers within five years. Later, that was changed to an export commitment equal to the price of computers imported.

...But it wasn’t easy

In that climate, however, there were a few software companies that dared to set up shop. The first was Tata Consulting Services, in 1968. After a few local orders, TCS got its first big export assignment five years down the line. In 1973-74, it did a stores and inventory control software solution for an electricity generation unit in Iran. The same year, it developed a hospital information system in UK along with Burroughs Corporation, at that time the second-largest HW company in the world. These were the nebulous beginnings of the Indian SW industry.

The cost connection

Despite the tough policy environment, by 1981-82, India was the only developing nation to have any significant software exports—$12 million—a substantial leap over the 1979 level of $4.4 million. Though 30 companies were registered as software exporters (most operating out of the SEEPZ Mumbai), the two Tata companies—TCS and TBL—accounted for 67% of all exports.

The main USP for Indian companies at that time was cost. The cost of a developer in India varied from $17,000 to $25,000 annually. The cost of sending the same developer to the US came to about $32,000-42,000 per annum. Compare this with US developer rates of about $60,000-140,000 yearly—the cost proposition was clear.

There were significant challenges, though. The first was the lack of availability of hardware—importing systems was neither easy nor cheap. The second—a shortfall in trained manpower. Although the education system was churning out enough engineers, only a handful of colleges offered computer courses.

So there it was—a budding industry with a large array of problems. To deal with them, the first ad hoc committee of software exporters was formed on 23 April 1983, with industry stalwarts like Nirmal Jain of TCS, Lynette Saldhana of ICIM, Adi Cooper of Digitron and Prakash Hebalkar of TBL at the helm. Eventually, Nasscom would be formed as the industry’s representative body.

But in 1984, the software industry found its first and unexpected ally—the Toshiba laptop-toting Indian Prime Minister Rajeev Gandhi. Within 19 days of coming to power, he introduced the New Computer Policy that simplified import procedures for software and reduced software import duties from 100% to 60%. Locally, software was recognized as a separate industry, licensing procedures were simplified and access to foreign exchange for software firms made easier.

This was the decade of churn, marked by three distinct phenomena—India’s metamorphosis into a ‘Unix country’, the rise and fall of the local packaged software market, and the beginning of the outsourcing era.

The Unix revolution

In 1986, the Rangarajan Committee on the modernization of the banking sector (set up by the RBI) came out with its report. Among other things, it recommended standardizing banking systems on Unix, then an unperfected operating system compared to MS-DOS. The government floated a tender for 400 Unix systems and set off a scramble among Indian companies to come up with a Unix platform. Though the local part of the contract eventually went to Sunray Computers, the report led local vendors into the Unix arena and eventually saw India’s transformation into a ‘Unix country’.

But the transition was not smooth. There were three main issues. One, the lack of an existing base of trained manpower on Unix and C. Two, computing requirements in India had been limited to batch-oriented jobs, and as a result, the capability of Unix, which is essentially a multi-user OS, was not fully understood. And finally, importing Unix at source from AT&T was not easy. So each company came up with its own version—none of them worked too well. Add to it the fact that Unix systems were also far more expensive—and there was a real problem on hand.

Driven by the banking sector, policy changes in 1986 enabled the import of the Unix source code and by 1988, Unix was emerging as the de facto standard in the super micro and the mini markets. According to an IDC study, 1,400 Unix systems were shipped in 1987-88, compared to just 480 the year before—a whopping 191% growth.

Software packages:

The rise and fall

In 1986, other norms had also been eased. Anyone could import software now at a duty of 60%. Indian firms could become distributors of foreign packages. And SW EOUs could import hardware without duties. The rationale was that by "flooding in" software, Indian firms over a period of time would gain the competitiveness and ability to "flood out" software.

Meanwhile, the PC had come to India. Within a couple of years, a price war triggered by Sterling Computers led to vendors slashing prices. By 1988, there were more than 70,000 microcomputers in the market. The PC and compatibles market boomed—alongside, local SW packages grew.

By December 1988, more than 500 software companies were churning out packaged software—a major chunk of them cheap accounting packages. New Delhi-based AK Saxena Software Consultants sold a series of accounting packages called Khazanchi, Munimji, Naazirji and even Lalaithaji. Most of them were priced at around Rs 490 and were targeted at PC/XT/AT users of small and medium enterprises. At the higher end were companies like Wipro (Easyacc), TCS (Business Management Series), Softek (SIMS), Radix (Finman)—all priced between Rs 5,000 and Rs 10,000. Despite the burgeoning domestic packaged software market, Indian players initially lacked the funds and reputation to penetrate markets abroad.

Eventually though, the local software packages industry died a natural death, with a few exceptions like Tally and Fact—alive and well to this day. The package industry had thrived on the PC boom but was killed by the import of foreign packages. Meanwhile, communications technology was silently maturing in India and another era was set to begin.

The birth of outsourcing

Till now, the export of software had meant a physical transfer—either of the programmer himself (bodyshopping) or of software on floppies. The first glimmers of a change appeared in 1985, when TI set up an office in Bangalore with a direct satellite link to the US. In 1989, VSNL commissioned a direct 64-kbps satellite link to the US. It was a new gateway switching system which operated through Intelsat and was directly linked to AT&Ts earth station at Coram on the US East Coast. It offered software exporters a completely new way of functioning.

Around this time, US policy changes forced Indian SW exporters to look beyond the body-shopping model. In 1993, the US Immigration and Naturalization Service proposed changes to the regulation that made it difficult to get B-1 visas. The new H-1 visa required a certification from the US Department of Labor that prevailing market wages were being paid to immigrant workers.

Its direct impact—clients would have lesser incentive to hire software engineers from India. Also, Indian SW pros were brought under the ambit of the Immigration Act and had to pay social security taxes (amounting to 21%) to the US. Eventually, what came to pass was a watered-down H1B visa. But combined with the changes in communications technology, a new way of doing business was born in the SW export industry—a mix of onsite and offshore. Exports boomed, growing from $128 million in 1990-91 to $485 million in 1994-95. A new era had begun.

Boom time

The last half-a-decade of the Indian software industry can easily be called its ‘Golden Era’. For a change, just about everything that could go right, did. Surviving Indian software packages began to receive international attention—Infy’s Bancs 2000, TCS’ E-X and Ramco’s Marshall (endorsed by Bill Gates, no less) came to the fore. According to IBS rankings, i-Flex’s MicroBanker was the topselling international banking solution in the world in 1995.

Year 1995 also marked the beginnings of Linux in India. PCQuest, the leading personal computing magazine, began giving out free Linux CDs in March 1995 to expose readers to "the other side of computing". By 1999, more than 70,000 CDs of Linux had been put out in the market and Indian Linux user groups were thriving on the Net. Then came the ERP boom. SAP, the worldwide ERP market leader, set up a 100% subsidiary—quickly, India became its fastest-growing market. In 1996, SAP was growing at 160%, with 40 customers in India. It forecast a growth of 150% for 1997.

And then, of course, was Y2K—the biggest bogey in software history that triggered off a chain of events. Exports grew on the strength of Y2K and never looked back. The local training industry boomed partially because of it. Aptech grew from 27 centers and a turnover of Rs 10 crore in 1991 to 850 centers and Rs 202 crore in March 1997. Locally, full-page government ads in leading dailies, asking companies to become ‘Y2K-compliant’, helped the paranoia along.

By the end of 1999, the industry was on an all-time high. IPOs of software companies were getting oversubscribed several times. Sonata was oversubscribed by over four times, KPIT 40 times, Satyam 19 times... This gave rise to a minor scandal that rose and fell—fly-by-night operators who often had no business at all started putting IT in their names and entering the IPO market. They made money; a lot of investors lost their’s.

Meanwhile, the venture capital phenomenon began to take off. According to figures released by the Indian Venture Capital Association, VC investments grew from Rs 70 crore in 1996-97 to Rs 2,162 crore in 1999-2000. A substantial amount of that investment in the last years went to dot-coms.

Getting closer to the bust

The bust? Or maybe not. This is recent history. By end-2000, the slowdown set in. The dot-com bubble burst. VCs began demanding sounder business models from start-ups, while earlier, they’d been willing to settle for an idea and a sparkle in the eye. Software exporters saw enterprise IT budgets slashed and RoI becoming key. They had hired in a frenzy in the boom times. By 2001 they were trying to fire quietly. For the first time, the industry witnessed lay-offs—and on a scale never witnessed before.

Going forward, there’ll be one word that will define the software export industry in the next few years—offshoring. At the moment, a good 60% of all software work happens onsite. It is more expensive for the client and offers thinner margins for the exporters. As a result, last year saw a greater push toward moving as much work as possible to India. At the same time, after the DoE allowed 100% FDI in the IT industry in 1999, a lot of MNCs set up development centers in India as their own offshore arms, most of them doing really high-end work.

This phenomenon and all the issues it generates in host countries will determine the shape of things to come in the next few years.

Dragon Vs Tiger

Not long ago, I read an article that talks about China's achievements in comparison with India's. The author concludes the article with an ominous warning about the price we have to pay to attain the same level of growth that China has shown over the past 25 years. Here are some excerpts from the article:

• Praise heaped on China by western organizations and media.

World Bank President James Wolfensohn attending the 'Conference on scaling up poverty reduction' in Shanghai in May, 2004, has heaped praise on China. The UN News site, no less, reports this: "Wolfensohn said the Chinese Communist Party's five-year economic plan was a good example of effective poverty-reduction strategies. "Shanghai is the obvious place to start considering ways to reduce poverty," he said. "There is something here we need to learn about constancy and good management." ". Hilary Benn, a British politician is quoted as saying, "China shows what can be done with the right circumstances and the right policies." Mark Malloch Brown of the UNDP said, "China took the lead in its war against poverty rather than relying on development agencies to steer its course."

• China's achievements and secrets

China's achievements, as parroted, are formidable. In the 25 years since it took to the capitalist road, poverty has fallen from 50% to less than 10%, GDP increased from $360 billion to $12 trillion, its ranking in world trade climbed to four and its average personal income, risen to today's $1000. China's strategy to achieve all this—in strictly economic terms—can be simply stated thus: remove all barriers to growth in a controlled area, viz the eastern seaboard, create a boom there mostly through huge investments in infrastructure, and then take the prosperity in a bag, for distribution in the vast hinterland.

• Chinese deception

China defines its poverty line at $76 per year, whereas India conforms to the World Bank norm of $365/year. Think that over deeply and then, evaluate India's performance. Also, for a country with an average income of $1000 a year, China's definition of its poverty line is astounding. Only less so, than world's applause for its performance. China's compliance with the UN Statistical System is partial whereas India's is total". Truth is, China's is an 'open' economy in a 'closed' society where 'facts' are opaque and answerability is non-existent. It is widely suspected, that a large part of it's huge FDI is in fact, ill-gotten local money [—'black money', you'd call it here] round-tripping back as investment.

• Rights in a left country

For 3 weeks in 1989, civilians—mostly students— gathered in Beijing's Tienanmen Square in protest against a wide variety of social issues. The state moved with alacrity. The details of what happened may be read here, but at the end of it, 2600 lay dead and over 7000 were injured.
In Kashmir, no 'outsider'—even if he is married to a Kashmiri girl—may buy property under a covenant known as Article 370. In just forty years, China has overwhelmed locals in Tibet by a planned influx of ethnic Chinese.
On another front, the one-child-per-family policy, implemented by coercion, maybe leading to grave economic concerns today, but that is an issue apart, from the central one of rights. Indians still recall the Emergency's birth-control forays as a great incursion into their rights.
For those exercised over the Tehri and Narmada dams, the Three Gorges Dam in China would be an eerie story to read. It will cost $26 billion, rise 180 metres and displace 2 million people.

Money from Shit

This is an interesting article from www.goodnewsindia.com. Read it to believe it.

Let's face it: for all the many things we Indians can be justly proud, we do suffer from an incompetence when it comes to sanitation. Some would even judge us a vicious society. After all, have we not for centuries expected a whole caste of fellow Indians to clean up after us? How little we train our children in toilet use. How terrible our public --and frequently, even private-- toilets are. How shoddily we design, build and maintain them. Gandhi, wise as he was to Indians' ways, chastised us and urged us to clean our own latrines. Alas, to little avail. The best groomed Indian often leaves a wrecked toilet behind. It is not surprising that we are a laughing stock around the world in this regard. Truth is, we have an uncomfortable, unprocessed mind mess when it comes to toilets and our responsibility towards them. Now at last we have an Indian, who is aware of this problem; who is proud of creating and maintaining sparkling public toilets. If Fuad Lokhandwala is emulated widely, there is hope yet, that we will correct a gross flaw in our collective outlook.

A Jay Leno jibe:

The year was 1998. India had thumped its chest and declared itself nuclear. Indians brimmed with pride. The world reacted with anger, threats and sanctions. All that flew over the heads of gleeful Indians. Fuad too was euphoric-- but he stopped dead in his tracks one day, while watching a Jay Leno Show on TV. The burly wit had said something to the effect, "Indians can build nuke bombs but they can't build decent toilets." It hurt. And yet, as with the best of humour, how true!

Fuad was in his forties and had spent 25 years of his life in the USA, as a student and as a professional. "I loved it there -- the energy, the systems, the order. I longed for India to be up near there someday," he says. "It puzzled me as to what we lacked. What was it that we must get right?" Back in India he had not quite settled down to life in Delhi. He was unsure as to what he should be doing. A routine 'job' made no sense.

What he didn't quite know about himself was that he was a Yankee style entrepreneur. Jay Leno uncorked that. Fuad's obsession began that moment: "I will build world class public toilets!" It is obvious that such a resolve would invite ridicule in India. His loving wife Mehru and daughter Sanaa were 'deeply concerned'! But an obsession must run its course.

Not 'pay', but 'paying' toilets:

After six months of trying to sell his 'crazy' vision, Fuad had the ears of K J Alphonse, an activist bureaucrat. Alphonse was apprehensive but nevertheless took him to 'his minister', Jag Mohan. Fuad had their attention. Yes, it was time we built toilets we need not be ashamed of, but how would we fund them. It was one thing to get New Delhi Municipal Corporation [NDMC] or Delhi Development Authority [DDA] to permit him to build his dream toilets, but where would the money come from for maintenance and as return on investment? After all, you can't load on the user all that it costs to build and run.

Fuad knew he had a hurdle. Given his specifications, each of his dream loos would cost Rs.10 Lakhs. And that is big money in India. He sat with his indulgent wife and daughter and discussed the deadlock. Suddenly Mehru said, "Hey, if it's going to be upmarket, why don't you get upmarket advertisers to support it?"

In a few days, Fuad had made a model, prepared a business plan and a formal request that said more or less, "just give me the permission and I will provide a service India can be proud of". He got the permit. He reminisces now: "Yes, it's not simple in India. But doors do open for those that are sincere. Most of the time our bad mouthing the Indian system, is to do with our tendency to seek alibis. I found a receptive bureaucrat and a politician who backed me."

The Great Wall of Ads:

But no one was going to give him money to build a loo. He formed Fumes International Company, and decided to put his own savings on the line. "If I am an entrepreneur worth my salt I must take risks," he told himself. He began to build his definitive toilet in one of Delhi's in-places - Khan Market. He lavished all his care and attended to every detail. Mehru an interior designer was with him the whole way. It was not to be just a tucked away loo, but a high profile object of style. When it opened in late 1999, it was a hit at once. Almost always in India, we build great edifices but pay little attention to how we would maintain them. Fuad was firm from the beginning: "my toilets have to be inauguration clean forever." He had spent time in planning maintenance, training his staff and they paid off.

After five years they are spotless. Two attendants clean after every use. A watchman guards it between 10 pm and 7 am. Visitors are delighted. An affluent lady says she uses it all the time. Bernie Fernandes, a working woman says, "I feel so safe, relaxed and comfortable." A highly impressed Robert Kinfarley, the head of World Health Organisation [WHO], in Delhi sent his staff to Fuad's toilet for training. Clearly user endorsement was gathering. Visitors are charged a token Rs. 1 and Rs.2, just to induce a sense of responsibility.

Though it took him over six months trying to persuade advertisers to support him, he was certain he had a USP: foot falls of the spending kind. Early mind blocks were blown away. Big names were eager. Fuad's toilet walls are not cheap to advertise on. The income from ads enables him to pay great wages, make a nice profit and build more toilets. He has 11 in Delhi so far, in places like Connaught Place, Lodi Gardens, Sundar Nagar, Golf Links etc. Each is a unique piece with marble, granite, chrome, plants, aquarium and above all with that heavenly peace that reigns in great washrooms. Fuad is forever making the rounds. Are the sills clean? Is the soap in the right place? Is the plumbing drip free? He's a perfectionist.

Now to garbage:

There is some concern now that his business model is stoking greed and quick grabbers are moving in. Fuad is worried that the idea of cost free, public sanitation may lose out if cronyism creeps into city administration. There are now about 80 toilets based on the Fuad model. He hopes all would pay attention to upkeep. But there is a built-in safeguard in the idea he has pioneered: if a toilet is run down, it won't attract advertisers.

Fuad is now attempting to make garbage pay. He has built collection and sorting centres where again advertising will pay for the process. He admits it's not a commercial success yet. And he has begun to ponder what else he should be doing to improve India's image in terms of public sanitation. So the question arises, what about toilets for the poor and for small towns? This questions has been asked in the past and almost always been answered wrongly. Tokenism has ruled and subsidies and handouts have steadily been siphoned off. In the end the poor get unusable toilets.

Fuad says, let entrepreneurs in and they will create the right commercial product. Has not C K Prahlad, the management guru said that Indian entrepreneurs are ignoring the huge market of the poor that exists in India? Bottom up planning is good when you are talking of livelihoods. When it comes to behavioural changes, the process is always from top to down. Given TV, travel and visible changes in the cities, the poor --whether or not you like it-- wish to ape the rich. Computers, education, mobile phones, grooming, and lifestyles are being mimicked. Why not toilet habits?

So how do you build toilets for slums and small towns without subsidies? Fuad has a brilliant idea: build quality spaces but to offset for the fact that premium advertising may not be forthcoming, run a shop attached to the toilet! He is yet to try out but is sure it will work. It would need of course new thinking on the part of local governments.

Coming from the centre:

Fuad Lokhandwala's life has run a zig zag course. Born affluent, he grew up lonely and determined to make it on his own. "My marriage to Mehru was the turning point in my life. She was 18 and I, 20. Through her I came to know --and to deeply admire-- her family, especially her father, R H Chisti, IAS. He was by inclination a saintly man. That he was a direct descendant of the Khwaja, Moinuddin Chisti of Ajmer probably explains that. Through Mehru too I have Sanaa, my daughter and my passion. And now I have this mission. I ascribe all I have achieved to Mehru," he says dreamily.

An affluent man, a happy, family man, Fuad could have done tens of other things with his time. But India got lucky because Jay Leno made smoke come out of Fuad's ears. By the way, was that why he called his company Fumes? "Naaw," he drawls with a wink. "It stands for FUad, MEhru and Sanaa."

History of TCS

As part of the process of preparing for my interview, I am brushing up on certain aspects of my resume that I am going to project in my apps. Facts and figures on TCS are my first priority now.

History of TCS

In 1968, Tata Sons Limited, the Tata Group's holding company, started TCS as a strategic initiative based on the insight that management problems in Indian industry would be mitigated -perhaps even resolved, through effective use of information technology.

Under the leadership of F.C. Kohli, TCS pioneered the Indian effort to create a globally recognizable brand for the Indian software industry.

TCS' first decade was devoted to establishing its base in Mumbai (formerly Bombay). Throughout this period, strong links with academia underlined the intellectual underpinnings of the consulting business. Professionalism was promoted through participation in the activities of professional societies, peer recognition and in-house training.

At a time when other cities in India had not yet ventured into the software business, TCS started "specialty centers" in Chennai and New Delhi. The pattern of best practices in Mumbai's and Tata's governing was replicated and carried forth in these new offices.

Through the 1980s and 1990s, TCS invested heavily in Software Engineering Practices and Standards, Software Quality Assurance, Software Project Management, Software Process and Allied Metrics, and Research & Development in Software Engineering and Software Technology.

As our intellectual horizons expanded, so did our geographical reach. As a result, today TCS is India's largest IT company, as well as Asia's largest independent global software and services firm.

TCS is the single largest software services exporter from India, servicing clients in more than 50 countries around the world. With over 65 offices outside India, TCS is now truly transnational in character and reach. TCS employs more than 18,000 consultants and serves hundreds of clients, providing information technology and business consulting services to organizations in government, business and industry around the world.

Over the past decade, TCS has grown dramatically, doubling its revenues every two years, and is on the verge of becoming a billion-dollar company.

Andamanis Rejoice

andamanis, originally uploaded by thoughtcurry.

All the Andamanis in Hyd decided to spend an evening together at one of the local malls. Attendees were

• Tapash - Tribal Warlord of Derring


• Ritu - Chief Priestess of Pilo Milo


• Suparna - Queen of Pilo Babi


• Sayantan - Medicine man from Kondul


• Moa - Chief of Mus

We caught up on old times, pulled each others legs and had two hours of unadulterated fun. On the cards is another get together with Tapash and Suparna volunteering to cook some long forgotten seafood delicacies. Until then

Jinga La La Hu

New year party

Had lots of fun on New Year Eve.The Chakrabarty's had organised a rooftop BBQ party with lots of booze. Partied till 2 am in the morning. The best part was the BBQ. The meat was yummy. Add to it the blue lagoons and wine mixed by Shantanu and you get a memorable New Year party. Had a hangover the whole of thenext day. Priya had to contend with panner and bbqd potatoes.