How do you summarize a full-day, insight-packed Stanford seminar that explores the topic of the globalization of services? Well, I can’t really. But I can offer some notions that stood out for me from the event.
First, people will come from all over the world to rub shoulders with academics and VPs and directors from various companies. That included representatives from Stanford, the University of California, Berkeley, Davis, Santa Barbara and Santa Cruz; and San Jose State University. It included experts from India service providers TCS, Wipro Infosys and Cognizant. Present were US service providers HP and IBM. And it included client organizations from Cisco to Texas Instruments, from Google to Sun Microsystems. This event is short, inexpensive and crammed with panelists and sessions (butt-lock is probably a fairly common occurrence as breaks are few and brief). It really should be better attended.
Second, there’s a definite change in the subjects being discussed among these experts. It’s no longer strictly about how to move up the value chain in what is being outsourced offshore — that’s already taking place all over. Companies are coming up with basic ideas and then hiring Indian firms to take care of the details — from product speccing all the way through manufacture and fulfillment.
It’s no longer about how seriously to take Indian companies as business partners; they’re here; they’re fierce; get used to it. Just consider the number of India-based firms that are buying companies in other parts of the world. They have far greater ambitions than simply taking over our data centers.
Along the same lines, other places in the world have growing services industries too. These countries — Mexico, the Philippines and China — may not be as dominant as India, but they offer legitimate alternatives that may work for your specific requirements and situations.
And the notion of geographic boundaries (particularly national ones) becomes quainter with every passing year. As keynoter Francisco D’Souza, the CEO of Cognizant, pointed out, the question, "Where are you from?" becomes more and more difficult to answer. "DNA is becoming delinked from geography at very atomic levels." Personally, I’m from Michigan, California, Ohio, Arizona, Washington and Illinois. Many people would offer a litany of countries instead of states. The same is true for goods — cars, airplanes, clothing. The same is becoming increasingly true for services.
Third, after hearing "war" stories from participants, I have to laugh when I read statements in press releases such as one from earlier this week, wherein a startup said it was opening an office in India for product development and expects to ramp up from its current three employees to 50 people in the first year. If they’re hoping to find experienced, smart people, they’d better crank back on expectations. Talent is tough to find, hire and retain and will cost more than you expect, no matter where you are in the world.
Regarding strategies for offshoring, you can pick from any number of models — domestic provider/foreign provider; Greenfield; built-operate-transfer; joint ventures; equity partnerships; acquisition; combinations of the above. But, as co-host Rafiq Dossani declared, "Each strategy for offshoring presents different management challenges. And in each you can fail. And in each you can succeed fabulously."
I hope to publish several of the papers touched on during the day. But this is one of those events where the papers don’t necessarily mesh with the discussion. You have to be there to absorb all of it.
