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Tinkering With The Business Model Doesn’t Count

Published by Sharad Sharma July 1st, 2007 in biotech/pharma industry. 471 Comments

I have been on the look out for somebody in the Big Pharma to break out of the pack. I have given up on Daniel Vasella, Chairman of Novartis. He is still firmly in the cyclical slowdown camp. He reminds me of Rich McGinn, the former Chairman of Lucent, who kept asserting that the landline slowdown was temporary/cyclical and not structural for far too long. Pfizer has looked like a possibility. Jeffrey Kindler, their new Chairman is an outsider. But so far he hasn’t made any noteworthy moves. Now The Economist suggests (“Beyond the Blockbuster”) that Roche is a possible break-out candidate. It’s excited by Roche’s $3b hostile takeover bid of Ventana, a diagnostics firm. It sees this as further evidence that Roche is serious about being a big player in the targeted cancer therapy space.

Targeted oncology has gained momentum over the years. Instead of looking for one blockbuster drug that will treat the over 200 types of cancer, firms have started looking to develop specific treatments of particular cancers. Many firms, big and small, are in the race here. And indeed The Economist is right to say that Roche and Genentech (majority owned by Roche) have a strong franchise in this space. Their recent acquisitions of NimbleGen and 454 Life Sciences made that franchise stronger.

Yet there is a problem. Roche is still stuck with the traditional vertically integrated model of Big Pharma. I believe that the shift away from one-size-fits-all drugs to more specialized (and, in the future, personalized) drugs requires a business model change. What is needed is a disaggregated model where the firms focus on a few core areas of competence, such as drug discovery, development or marketing and outsource the rest to the growing legion of biotechnology start-up firms, contract research organizations, independent drug-development firms and freelance sales organizations. Other forms of cross-company collaboration are also needed to build a new drug delivery system and a new sales model. I am still waiting for a Big Pharma player to move past the tinkering stage to the take-leadership stage.

[Several earlier posts: Looking at Orbit Change in Three Industries and Big Pharma is Feeling the Pressure are also relevant to this discussion]

Explaining The Silence

Published by Sharad Sharma July 1st, 2007 2545 Comments

I haven’t posted anything for two weeks. June has also been the slowest month with only 4 posts. An explanation is in order. As many of you may have guessed, the real culprit is my new job. It’s been keeping me really busy. The little time that I have been getting to reflect has gone into figuring out Yahoo! And all that good stuff about Yahoo! is not blogable.

I think July will be better and I am going to try posting 3 times a week.

The Silly iPhone Frenzy

Published by Sharad Sharma June 17th, 2007 in mobile industry. 485 Comments

I am sorry I don’t get the iPhone media frenzy. What gets my goat is that people have gone ahead and declared this to be the “before iPhone” and “after iPhone” era. I think they are smoking pot.

Let’s put things in perspective. Apple expects to sell about a million iPhones in 2008. That’s a good number. But then Nokia sold about half a million phones in just one day in India alone (see news item here). Well, you might say that this is not a fair comparison. You are comparing apples with oranges. After all iPhone costs $500 and the bestseller Nokia phone in India, Nokia 1100, is only $30. It’s not about volume; it’s about impact. Look how iPod revolutionized the online music industry; iPhone will build on that legacy. It will have an industry shaping impact. Really?

First let me debunk the music myth. Apple sold about a $1b of music through iTunes in 2006. On the other hand, ringtones/ringbacks on plain-old-humble cellphones sold at least six, yes, six times as much (according to Gartner).

The fact is that these plain-old-humble cellphones are not just revolutionizing music; they are also changing television. Just look at American Idol. Do you think that format would have happened without SMS? SMS voting using plain-old-humble cellphones has spawned a multi-billion dollar genre worldwide.

Even FM radio is seeing an uptick due to the plain-old-humble cellphone. In fact in places like India a large part of the audience and advertiser growth of FM radio is attributable to the low-end phone with built-in FM radios. This trend is sure to spread to other markets.

Let’s face up to the new reality of our era that revolutions now come from the bottom of the pyramid. Gone are the days when a cool Silicon Graphics workstation could be touted as a harbinger of industry change.

Please don’t misunderstand me – I have no doubt that iPhone will be a great product. Let’s admire it as one would a new 7-series BMW. But please let’s not suggest that it’s going to change the car industry. If that’s the kind of impact you are after, better look for something like the Tata $2000 car.

Charlie Munger’s Tenets of Life

Published by Sharad Sharma June 13th, 2007 in leadership. 2605 Comments

Charlie Munger, Berkshire Hathway’s Vice Chairman and Warren Buffet’s partner gave a wonderful Law School Commencement address at the University of Southern California recently where he lays out his tenets of life. Here are five things he says that really resonated with me…

  1. Safest way to get what you want is to deserve what you want.
  2. To deserve what you want you need a lot of “assiduity”. And what’s assiduity? It’s the ability to sit down on your ass until you do it.
  3. In addition you need to practice continuous learning. People who rise in life are not the smartest, sometimes not even the most diligent, but those that are learning machines. They go to bed every night a little wiser than they were when they got up and boy does that help, particularly when you have a long run ahead of you.
  4. You must never allow yourself to drift into self-pity. It’s a ridiculous way to behave and when you avoid it, you get a great advantage over everybody else or almost everybody else because self-pity is a standard condition, and yet you can train yourself out of it.
  5. Finally go through life anticipating trouble. So when it comes you are prepared financially and mentally. It’s your duty to deal with a terrible blow in a constructive fashion.

Read the whole speech here. (Thanks Yuvraj for sharing).

[My earlier post on Passion, Happiness, Work, Play and Life may also be of interest to you.]

Update: Sadagopan has a nice post on this as well.

Avaya Quits Halfway Through Its Transformation Marathon

Published by Sharad Sharma June 10th, 2007 in organizational design. 1924 Comments

A few days back Avaya announced that it’s going private. It has accepted a $8.2b deal from TPG capital and Silver Lake Partners. At this point, it’s not clear how going private will help it compete. Everybody, including the senior leaders, appear to be in the dark about what the new game-plan is going to be. I have a lurking suspicion that there isn’t much of game-plan in place.

The deal, of course, has something for the private equity players. The PE guys see a company with good amount of cash on its balance sheet and a healthy maintenance revenue stream. They will be able to extract some value through clever financial engineering.

Avaya doesn’t get much from this deal – in terms of technology, products, talent - that would make it a more successful player in the market. Why then, you would ask, did the Avaya management agree to this offer from the PE firms?

I have a hypothesis that sometimes a company running a marathon – as Avaya was doing – gets fatigued and simply gives up. In a real marathon, somewhere along the half-way point, the glycogen stores run out and the mind starts telling you to slow down or stop. If you haven’t prepared for this energy depletion event, it’s very hard to go on. Companies adjusting to industry transformation are running a marathon too. Somewhere halfway through the process they feel tempted to just give up. Digital succumbed to this temptation and went into the arms of Compaq. More recently, VERITAS Software merged with Symantec more out of fatigue than any other reason. Now, I suspect, Avaya has given up although the CEO Louis D’Ambrosio would never admit that to be the case.

This capitulation is sad because Avaya was holding its own in the VoIP PBX market. It was doing well against Cisco; its market share in the first quarter was 25.3% compared with Cisco’s 25.2%. It was also doing well in the burgeoning call/contact center market in India compared to Nortel and Cisco. Generally speaking, it had been able to tap into the desire for evolutionary change on part of the enterprise customers as they migrated from traditional circuit switched technology to VoIP.

The nest stage of this story is not pleasant. My fear is that we will see demoralized employees, anxious resellers and edgy customers. And a downward spiral will gradually take hold. I hope I turn out to be wrong.

Linkroll is Back; More Follows

Published by Sharad Sharma June 3rd, 2007 2233 Comments

I got back from my vacation a few days back but have been busy catching up at work and at home. This weekend I caught up with my blogfeeds so the Linkroll is back. I’’ll back with some blogposts soon.

Rethinking Solitude in a Connected World

Published by Sharad Sharma May 18th, 2007 in uncategorized. 783 Comments

I am just back from a vacation in Yellowstone National Park (YNP). YNP let in the cars in 1915, snowmobiles in recent years but surprisingly hasn’t been friendly to the Internet. I had no Internet access inside the Park and am now catching up with my email and the RSS feed backlog. It will take make a few days to get through it all.

Although I didn’t mind being cut off from my email and RSS feeds, I did miss the Internet. There were many times when I wished I could have dived deeper into a particular geological feature. For instance, most of the geyser activity is in the Yellowstone caldera which itself is not too dissimilar to the Ngorongoro crater I visited last year. Both are about the same size (less than 30 miles in diameter) and similar in age (less than 2 million years old). Given this, it would have been fun to explore the similarities.

How we interact with nature is changing due to the digital age. Gone are the days when people would buy postcards to remember their visit to a place. Now everybody wants to take their own special pictures of landscapes on a trip. My 9-yr old daughter isn’t interested in a nice picture of the beautiful Yellowstone Lake in a coffee-table book; she wants her own special photograph. Photography is no longer about recording a vista; it’s now about personal expression.

Similarly learning about an awe-inspiring geyser is no longer about reading a plaque put up by YNP. Instead it’s about using that plaque as a starting point for making your own personal mind-map using the Internet. This doesn’t mean that you need high-speed internet on the phone - I don’t expect to be standing in front of the geyser and browsing on my phone. I want to be able to soak in the moment at that time but later back in the hotel room be able to reflect on it more deeply using the Internet. It’s not much to ask for. But on all my recent vacations, this hasn’t been possible. For instance, it would have been nice to look at Jean-Pierre Houdin’s theories about pyramid building when I was in Egypt.

We need to rethink solitude in a connected world.

April Roundup

Published by Sharad Sharma May 12th, 2007 in roundups. 3174 Comments

Phew! I have completed six months of blogging a few days back. It seems I embraced blogging just before the bubble burst. Just as well :-)

There might be slow blogging for the next two weeks. From yesterday I am on vacation with family and they are already resentful about my plan to spend time on a “professional” blog. Let’s see how it goes. In any case, I hope to keep up with my Linkroll.

Every month I share some traffic numbers in the monthly roundup. I am stopping that practice since the blog now has a healthy readership. The only thing that I really care about anyway is reader participation through comments. Please comment when you feel you can add to the conversation.

These are the most popular posts of April. Check them out if you missed any…

Passion, Happiness, Work, Play and Life
Work-life balance is about ditching the Deferred Life Plan. Not only shouldn’t family be deferred, Randy Komisar suggests that passion also shouldn’t be deferred. He describes passion as something that pulls you towards something you cannot resist while drive pushes you towards something you feel compelled or obligated to do. “If you know nothing about yourself you can’t tell the difference”. This ties in very well with Martin Seligman’s research on happiness. He suggests that true happiness doesn’t’ happen unless you know your own strengths. After all, it’s playing to your signature strengths that brings passion alive. Read on…

Cultivating Intercultural Competence
An IHT story about Dutch soldiers in Afghanistan brings out the cultural difference between Americans and Dutch people. On Geert Hofstede’s masculine/feminine dimension Americans are staunchly “masculine” while Dutch society one of the most “feminine” in the world. This difference has created problems in the past as well and is emblematic of the problems businesses face in managing truly global knowledge workers. Developing intercultural competence is now critical for the new multinationals to succeed.

Fighting the Innovation Hype
Hype has surrounded the word innovation and a backlash is underway. Although Clayton Christensen has introduced a useful framework around disruptive and sustaining innovation, a commonly understood taxonomy hasn’t taken shape. So let me take a shot at proposing a layman’s terminology…

YEGA IS Rising!
I like Vinnie Mirchandani because he doesn’t beat around the bush. He responds to Paul Graham’s article “Microsoft is Dead” by simply stating that its not just Microsoft but also IBM, SAP and Oracle (see his post “MISO is dead”). In a way he is right. They are all part of the fading edge. What’s rising in place of MISO is YEGA. The yahoo, eBay, Google and Amazon are part of the leading edge. But if truth be told, my respect goes to GET-IN, a slight twist on letters that represents GE, TI and Nokia…

Copyleft and Higher Education
For me the real battleground between the copyleft and copyright movements is not music but higher education. This is why I am really interested and emboldened by MIT’s Open CourseWare program. This has implications for India as the hiher education system undergoes some serious reform.

Cutting the Chord to Reality

Published by Sharad Sharma May 10th, 2007 in mobile industry. 1796 Comments

It’s rarely that I am serious disappointed with an Economist story but I feel that way about the special report, “A World of Connections” (subscription required). It talks about machine-to-machine wireless communications. Most of the application use cases it lists are still speculative. What’s more, it extrapolates much too easily from RFID to mesh networks. RFID price point is cents per node; mesh networks are talking about dollars per node. Plus there is this complicated value chain involving slow moving mobile operators.

While the report acknowledges that mobile operators are impediments to any quick rollout, it blithely ignores the significance of this point. I would have liked to see a stronger treatment of the adoption dynamics. If anybody has to make a case that old status quo doesn’t change just because new technology becomes available, it should be the Economist. After all, they have been very eloquent in the past about the same issue in the context of the US healthcare provider industry. Despite new technology (electronic medical record keeping, handheld devices, EDI, etc.), the old inefficient status-quo hasn’t budged. Continue reading ‘Cutting the Chord to Reality’

Inventor to an Industry

Published by Sharad Sharma May 7th, 2007 2183 Comments

This weekend I was in Ohio and so went over to visit Wright-Patterson Air Force Base Museum near Dayton, OH. We never managed to go there when we lived in Columbus but here we were visiting that place as a tourist. It was a delightful visit where one could see the transitions from aircraft inventors to aircraft companies and then to the whole industry.

Interestingly, the Wright brothers, despite being pioneers, were edged out in business, in part, by clever use of the patent law. The story goes that Glenn Curtiss of Hammondsport, New York started stealing the designs of Wilbur and Orville Wright. The Wrights sued but Curtis had shrewd lawyers who kept the suits from causing damage. Eventually Curtiss Aeroplane Company started turning out better planes. The irony is that eventually the company changed its name to Wright Aeronautical Company.

1905 to 1918 was a period of intense innovation in aircraft design. Interestingly the initial traction came from Europe. One of the Wright brothers traveled there to get initial business. In fact, most of later US efforts were built on British designs. US did have better engine technology but Europe held its own in aircraft design all the way till the end of WW II. Looking at Boeing and Airbus, the rivalry has never gone away. Continue reading ‘Inventor to an Industry’

China and India: Opportunities and Threats for the Global Software Industry

Published by Sharad Sharma May 3rd, 2007 in software industry and book review. 1494 Comments

Indian firms like Infosys and Wipro have already reshaped the IT Services industry. Now China is focusing on building up its software industry. What are the implications of this for the global software industry? This is a question that dogged many observers. Until now I haven’t seen a thoughtful analysis about this. Yes, there have been a number of opinions expressed based on anecdotal data and armchair speculation. But there is nothing like what the book, China and India: Opportunities and Threats for the Global Software Industry by John, McManus, Li, Mingzhi, Deependra, Moitra offers.

This book provides a good analysis. It first looks at China and India separately using PESTEL analysis. It then compares the two of them together using a SWOT perspective. This sets the stage for a good discussion about their influence in the global software industry. Since China and India aren’t acting independently the authors do a fairly perceptive examination of the interrelationships between the strategies of the two countries. They also look at likely competitive strategy and positioning that China and India are likely to follow in the years to come. Continue reading ‘China and India: Opportunities and Threats for the Global Software Industry’

Product Ecosystem in India: Progress But More Needs to be Done

Published by Sharad Sharma May 1st, 2007 in innovation, software industry and entrepreneurship. 192 Comments

About six months back I had written a cautiously optimistic post about the product ecosystem in India. Slowly but surely things seem to be getting better.

A DEMO style conference for Indian startups to showcase their products now exists. In fact, Proto.in is having its 3rd 2nd session in Chennai in July (check out their Jan session here). There is also an Indian version of TechCrunch; it just happens to be called Webyantra! Then there is Venture Intelligence which is a take off on VentureWire.

The communities focused on startups - MobileMonday, BarCamp, TiE - are also doing well. Continue reading ‘Product Ecosystem in India: Progress But More Needs to be Done’

My Second Blog!

Published by Sharad Sharma April 30th, 2007 101 Comments

Have you seen my second blog? It’s my Linkroll; it’s in the sidebar (it’s just above the Blogroll section). It contains the best blogposts that I encounter while browsing the blogfeeds that I have subscribed to. I have been busy catching up with my blog reading this weekend so you have a lot of good additions to the Linkroll. You will enjoy the diversity of articles there.

If you are reading this in a newsreader, you can access my Linkroll here. You can even subscribe to this Linkroll feed on the Google Reader page that comes up. Think of it as a bonus blog that you get with this main blog!

Crowdsourcing Comes to the Patent Office

Published by Sharad Sharma April 29th, 2007 in ipr issues. 144 Comments

The current patent system is under strain and is failing to cope up. Right now the average waiting time to win a patent is 27 months and rising. There is a huge backlog which is a being blamed for a fall in quality of inspections of the patent applications. One interesting suggestion is to open up the patent process to peer review. A pilot effort for 250 patent applications is getting underway.

In this pilot project the US Patent Office is planning to post patent applications on the Web and invite comments but also use a community rating system designed to push the most respected comments to the top of the file. This is another example of crowdsourcing. At one level this is not such a radical suggestion. After all journals have been using peer reviews for generations. Arguably the role of a patent officer and a journal editor are similar. Both have to determine if the claims are real and novel. It will be interesting to see how this experiment goes. Continue reading ‘Crowdsourcing Comes to the Patent Office’

News Corp. Bets on In-market Incubation

Published by Sharad Sharma April 28th, 2007 in organizational design and new-media industry. 2069 Comments

One of the biggest challenges for a global corporation is to strike the right balance between local responsiveness and global integration. Over centralization can make a good strategy go sour (see “Hope Vodafone Has Learnt Its Lessons (about Globalization Models)”). On the other hand a weak center can create its own chaos. In the last ten years the landscape has changed so much that the old maps for going global are no longer relevant. In fact, what used to work in the past is now becoming passé.

If at all one needed a reminder of this, it came in the form of News Corp. announcement yesterday that MySpace China will be an indigenous business using only the MySpace brand. Luo Chuan, a former senior executive in-charge of MSN Portal in China, will be the CEO of the new venture called MySpace China. This venture will have News Corp., IDG Ventures and China Broadband Capital as investors. Luo says he will have a free hand and will not be required to “follow the narrow dictates of executives based in US”.

Think about it… in effect, News Corp. has chosen to finance a Chinese startup rather than import its hugely successful MySpace.com unit. They have taken a path that would be unthinkable in many companies. No doubt what helps is that News Corp. is new to ‘new media’ and so very little legacy to worry about. Therefore they can question traditional wisdom.

I believe that this News Corp. decision is part of a larger trend. I see in-market incubation being critical to opening up the next wave of growth in emerging markets. So companies that unlearn their old ways and master the challenges of in-market incubation will be the ones that will be successful. Continue reading ‘News Corp. Bets on In-market Incubation’

Changing Gears: Joining Yahoo!

Published by Sharad Sharma April 25th, 2007 in personal. 1525 Comments

Yahoo! announced today that I will be their CEO of India Research and Development. Why am I joining Yahoo!?

More than anything else, it’s to make in-market product incubation succeed. I believe that in-market incubation will be the key to unlocking the next wave of growth in emerging markets.

The other reason is to do with cloud computing. Yahoo! has the potential to be a significant player here. I hope to be actively involved in this too.

Yahoo! has built a strong team in India. Its got talent, depth and critical mass. I’m excited to be part of it.

I’ll keep blogging as before. I like the fact that it forces me to set aside time to reflect on industry issues and tees off valuable conversations about where we are all going. Of course, everything that I say here continues to be my own personal views and opinions, and not that of Yahoo! That distinction is important to make in these new circumstances. Also, I would like to point out that you won’t see any breaking news on Yahoo! here; there are better places you can go to read about that.

Warren Buffet is Coming to Town! Well, Maybe

Published by Sharad Sharma April 23rd, 2007 in new-media industry. 192 Comments

Recently much has been said about the demise of the newspaper. New media like Yahoo!, Google, etc. is triumphing old media in US and other Western markets. In contrast, the old media is thriving in BRIC countries. Newspaper circulation is up in both India and China and advertising revenues are booming. Just for fun, let’s say you are Warren Buffet (WB). So you own Buffalo News in New York and a lot of Washington Post (WP). What do you make of all these industry changes? What are you going to do?

Sitting tight doesn’t make sense. WB realizes that. Here is what he wrote in his annual letter to shareholders recently…

Almost all newspaper owners realize that they are constantly losing ground in the battle of eyeballs. If cable and satellite broadcasting, as well as the Internet, had come along first, newspapers as we know them probably would never have existed.

So, I guess, its safe to say that doubling down on the existing investment is certainly out. After all, this is not a matter of horizontal consolidation. The enemy is the new media.

What are the options then? I can think of four. Continue reading ‘Warren Buffet is Coming to Town! Well, Maybe’

Is it Targeting or Timing?

Published by Sharad Sharma April 22nd, 2007 in personal. 154 Comments

In recent days I have wrestled with the narrow line that separates perseverance and stupidity. Admittedly this not the first time I am in this situation. I have faced it every time one of my experiments has eventually turned out to be a flop.

Whenever there is a flop I think of Edison’s undersea telegraph. He tried to simulate the electric resistance of a transatlantic cable by using cheap powdered carbon. But this carbon element would keep changing its resistance due to the rumble of traffic outdoors and clattering in the machine shop. Eventually Edison abandoned this effort. However, later, when confronted with the need to improve the transmission of voice over the telephone, he took the principle he had learnt from his unsuccessful undersea telegraph cable - variable resistance - and put it use in the design of a telephone transmitter.

In my own humble way, I too have learnt that no experiment is wasted. Continue reading ‘Is it Targeting or Timing?’

Escaping Early Stage Traps

Published by Sharad Sharma April 20th, 2007 in entrepreneurship. 179 Comments

Just a quick note to point you to Santosh Gurlahosur’s summary of yesterday’s NASSCOM Workshop for early-stage product startups. Both Prat Moghe and I enjoyed putting together the material and running the workshop. If you want the slides send me an email.

P.S. The Intrapreneurship SIG idea is also taking shape. We are looking for one or two young hungry intrapreneurs to be part of the core team. If you are interested, write to me and I’ll send you more details. Giri Krishna of TI and Ranga Raj of Celstream are partners with me on this effort.

In Praise of Jugaad Innovation

Published by Sharad Sharma April 18th, 2007 in innovation and entrepreneurship. 3399 Comments

In the last two weeks two automobile CEOs have used interesting adjectives for Indian manufacturing. Carlos Ghosn, CEO of Renault, on his trip to India said…

“We have come here to try and implement principles of what we call frugal product planning and frugal engineering. You are not going to learn these by reading, you are going to learn them by practicing with somebody who is doing as a way of doing.”

Today Rick Wagoner, CEO of GM, expressed the same sentiment. Here is what IHT reported… Continue reading ‘In Praise of Jugaad Innovation’

Confronting Cultural Gravity

Published by Sharad Sharma April 16th, 2007 in entrepreneurship and inter-cultural issues. 131 Comments

Prat Moghe and I are doing a NASSCOM workshop this Thursday for early-stage product companies. We’ll be focusing the three main traps that pre-Series A companies encounter - weak product architecture, incomplete team, and unclear market strategy (see workshop program). But before fixing any of these issues, one has to first deal with the cultural legacy of a strong IT Services ecosystem. What am I talking about?

Well, last year, I had stepped on some friendly toes when I asserted in an article that…

…our uniquely Indian problem has been that IT services companies have sucked out the oxygen from product companies. Their success has not only drained away talent, but has created an instruction-led and risk-averse mindset. They have turned our smart guys into mental coolies. After all, even now most of the IT Services companies get paid for head count and so there is not much business incentive to promote world-class technical talent. It’s only in product companies that technical talent is really appreciated and rewarded. Continue reading ‘Confronting Cultural Gravity’

Fighting the Innovation Hype

Published by Sharad Sharma April 15th, 2007 in innovation. 2506 Comments

The Hindu Business Line, a respected business newspaper in India, carries an interview of Rishikesha Krishnan (Professor of Corporate Strategy, Indian Institute of Management Bangalore) where he talks about innovation. Here are some gems…

Q. India, the back-office of the world. And China, the global factory. Do both the countries have a strategy to stay competitive through innovation?
Rishi> The unglamorous incremental innovation in all aspects of the organization is the lubricant of ongoing competitive success. Innovations that improve efficiencies in production operations or service delivery translate directly into improvements in the bottomline. Particularly for companies in developing countries that can be far from the productivity frontier of global leaders, efforts at continuous improvement are critical to catch-up as clearly demonstrated by successful companies from South Korea and Taiwan. Both China and India realize the need to build innovative capabilities.

Q. Are our [Indian] top companies innovating? Continue reading ‘Fighting the Innovation Hype’

Singapore, Inc.

Published by Sharad Sharma April 12th, 2007 1645 Comments

There is plan to increase the Prime Minster’s salary in Singapore by 60% to over S$3.1m. The high salaries have created an uproar there. The government defends its position by saying that it wants its Ministers to be paid like top executives. Predictably Lee Kuan Yew, former Prime Minster and now Ministerial Mentor, has defended this move. His comments are instructive. Some extracts…

Defending the system… Lee Kuan Yew painted a horrifying picture of a Singapore governed by ministers who earn no more than ministers anywhere else. “Your apartment will be worth a fraction of what it is,” he said, “your jobs will be in peril, your security will be at risk and our women will become maids in other people’s countries.”

Others have stated that… “To see a potential prime minister as no different from a potential top lawyer, and likely to be enticed by the same stupendous salary, would be to blur the lines between two very different domains.” Continue reading ‘Singapore, Inc.’

YEGA IS Rising!

Published by Sharad Sharma April 11th, 2007 in software industry and adaptable infrastucture. 2848 Comments

I like Vinnie Mirchandani because he doesn’t beat around the bush. He responds to Paul Graham’s article “Microsoft is Dead” by suggesting that its not just Microsoft but also IBM, SAP and Oracle that are dead (see his post “MISO is dead”). In a way he is right. They are all part of the fading edge. They are dealing with a saturated market on one side and with disruptive forces (offshoring, open source and SaaS) on the other. What’s rising in place of MISO is YEGA. Yahoo, eBay, Google and Amazon are part of the leading edge. They own the best data centers and will slowly but surely become platforms for cloud computing. This is a big inflection point the YEGA firms will get to ride for the next several years.

But if truth be told, my respect goes to GET-IN, a slight twist on letters that represents GE, TI and Nokia (see my Growth Anatomy Series). These companies are at the forefront of opening up emerging markets by doing in-market incubation of new products in places like India. They have a lot to teach others about making orbit change happen.

Cultivating Intercultural Competence

Published by Sharad Sharma April 9th, 2007 in inter-cultural issues. 197 Comments

I like to study intercultural differences. A few weeks back I had written about Microsoft’s goof-up in Russia that can be attributed to a cultural error of judgment. Today I came across another example of a gaping cultural difference.

Recently IHT carried a front-page story about Dutch soldiers in Afghanistan (“Dutch soldiers stress respect and restraint in Afghanistan”). It talks about the counterinsurgency tactics of a Dutch-led task force that emphasizes efforts to improve living conditions and self-governance, rather than hunting the Taliban’s fighters. Bloodshed is out. Reconstruction and diplomacy are in. Although this doctrine is not new, the Dutch have “the embraced this theory more fully than most, to the point that Dutch units now take steps to avoid military escalation and risk of damage to property or harm to civilians”. Not surprisingly the Dutch officers think that approach is “yielding promising results”.

Yet not everybody is convinced. Continue reading ‘Cultivating Intercultural Competence’

About

The software industry is going through a seismic shift. This change goes by many names: On-Demand, Web 2.0, SaaS, etc. But they all point to the same conclusion - the era of the traditional software “load, update, and upgrade” model is ending. And, at this stage of industry evolution, it’s not so much about seeing what’s next; it’s mostly about making it happen. It’s about confronting legacy business models and dealing with innovators’ dilemmas. It’s about transformation and implementing orbit change. This blog is a conversation about all these issues.

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