The reality behind Indian IT Cos

All too often globalisation is invoked as though it were a rallying cry with the potential to inspire national economic growth, consumer aspiration and new forms of lifestyle, with the accent on the style. However, globalisation is no virtual phenomenon. It is a set of concrete processes with real-time effects on our lives. And it is precisely in this tension between the idea of globalisation as representing an onward and upward march toward economic prosperity and the material implications of globalisation as lived experience that we observe the contradictions of the present moment even for those regarded as key beneficiaries, namely, those in Information Technology and Business Process Outsourcing. Despite differences within as well as across the IT and BPO segment, I consider the two as a whole here, since my interest is in certain problems that cut across the industry.

Alongside the print media glorification of the lifestyle of those in IT/BPO (often treated as if it were a distinct social category of hard workers and big spenders) there have been increasing reports of employee dissatisfaction with conditions of work. These include the deleterious consequences of long working hours, constant deadlines, night shifts, and the shrinking of social and leisure time. Quality of life issues seem to outweigh the question of the much envied and remarked upon high levels of remuneration. A working environment geared to "delivering no matter what" has led to complaints that even leave to attend to family emergencies have required negotiation or struggle. Additionally, those in customer care face the hostility of the very persons for whose comfort accents are altered, false identities are created, and most Indian holidays are forgone.

Outsourcing may have come to stay, but the conditions in which it is undertaken are surely amenable to change. We might wish to consider questions about the future to which IT/BPO employees are being invited to commit themselves. Is it worth expending one's youth and/or health in this way? How long can one's work routines distort the organic balance between mind and body, sleeping and waking, focusing and relaxing before we trigger a psychological or physiological collapse? It should be noted that

It is also worth pondering how much of the work in the outsourcing sector is truly cutting edge and how much clerical in nature or maintenance in function. The point is not that the latter kinds of work are undignified, but whether service or tedious work is being falsely represented as executive in nature and whether the conditions of work befit the inherent dignity of employees. The answers to such questions lie in the material conditions of work. By this I do not mean the air conditioning, landscaping, gyms and other facilities (the lifestyle indices, as it were), but the nitty gritty of the organization of work- work load, expectations of hours put in, business culture etc. The former cannot compensate for the latter except in the idealised world of advertising or in the abstract promises of the cheer leaders of globalisation.

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The Visteon Story

So like you all know am now on the rolls of the second largest automotive component maker in the world. I just hit upon a story about how it all started for Visteon and I wanna share that with you people. Keep reading!

The year 2000 and on the battle grounds were two behemoths of the American Automobile world - Ford and General Motors. Ford, in a fitting reply to GM's Delphi, helped organize in 10 months and which stays the second largest in the world right from the start. It is a company with a visionary, passionate leader, Charlie Szuluk. Its name: Visteon.

Charlie Szuluk, says Steve Delaney, is a man who has the inspirational qualities that can cause people to do things that they might not expect they'd be likely to do or be capable of doing. He's motivational, demanding, persuasive, and driven. When Szuluk urges, "Think breakthrough, think out of the box," the words resonate with passion, not empty platitude. When he describes what must be done is to "Make the customer successful," it is clear that fulfilling rote requirements doesn't cut it. Perhaps it is not surprising, then, that Szuluk is the man who is the president of a new organization formed by Ford Motor Co., an organization - or, as it is stated on the firm's business cards, an enterprise - that is unlike anything Ford has done in the past.

This enterprise, which is a reorganized array of the resources that had heretofore been Ford Automotive Products Operations, is both a part of Ford and, in a real sense, apart from Ford. That is, although it is a supplier to Ford, a supplier that Ford, in fact, owns, it is apart from the automaker in that not only does it have its own logo and identity - with nary a blue oval with flowing white script in sight - but Szuluk's mission, which he is taking on along with 78,000 others in the effort, is to get as much non-Ford business as is possible. This means, of course, working for other automakers. And if Szuluk's charisma and the enterprise's global design, engineering and manufacturing capabilities matter, then they should be getting plenty of orders.

Delaney, like Szuluk, began his career with IBM. Delaney was with IBM for seven years; Szuluk was with Big Blue for 24. Delaney joined Ford Electronics Div. in 1989 as an engineer. Szuluk joined that division in 1988 as general manufacturing manager. Delaney went on to become plant manager of the Ford Markham Electronics Plant, then, in 1994, joined Ford's new Process Leadership initiative as area manager of the Ford Production System. Szuluk became general manager of Ford Electronics Div. in 1991, became vice president of Process Leadership in 1994, and was named group vice president of the then newly formed Ford Automotive Products Operations on November 1, 1996. Delaney had left Ford in January 1996, when he joined AlliedSignal Aerospace Electronics Systems as vice president, Operations. Delaney says that it was a good opportunity, particularly being able to work with a leader like Larry Bossidy of AlliedSignal. But then he was called by Charlie Szuluk, the man who insists, "We will be the best." And Delaney was let in on the vision that Szuluk had for a new type of supplier organization, the vision that would be given public life at a worldwide announcement in September 1997. Delaney was convinced by Szuluk to return to Ford, which he did in February 1997. He is now vice president, Supply and Logistics for Visteon.

The paths of the two men - fast tracks that are not exactly typical for the auto industry - are indicative of the nature of the new company.
"Our number-one resource," says Szuluk, "is our outstanding people, who make outstanding products."

Plenty of executives say things like that. Few of them really believe it. Szuluk is numbered among the few. He recalls his travels in the early '90s when Ford was building electronics plants in countries around the world. "Wherever I went, I found out that if we set stretch objectives, and our people put their mind to them, and understood that management had confidence in their ability to reach the objectives, there really wasn't anything they couldn't do. Meeting stretch objectives for our customers will drive our success."

One of the things that Szuluk says Visteon will be doing is paying attention to cost reduction efforts while making advances in technology. He maintains that while cost is certainly an Important component to any calculations, as a supplier company, full focus on cost is an insufficient approach to being a competitor. "People who rely on low cost as a strategy and chase that don't do as well as those companies that both provide low costs and develop technology," he says. Certainly, flit is an issue of piece-part costs alone, companies can go chasing low labor rates and favorable exchange rates all over the world. Szuluk observes, "If a company is just focusing on things like labor costs, they can't win in this environment." As he puts it, "What's the differentiator?" That is, there is probably not a long-term advantage for any company that's competing on price alone, because in all likelihood there is another company somewhere that will be able to produce the component at a still lower price. If a company is able to combine other attributes - such as rapid product development coupled with lean manufacturing and excellent delivery logistics - then it becomes a more valuable company. And this is Visteon's approach.

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India's problems depsite its high growth rate

The economy is sizzling and foreign businessmen and investors are swarming to Bangalore and Mumbai to grab a piece of the action. India's year-on-year growth rate could well hit double figures at some point in 2007, and the country may even grow faster than China for at least one quarter. But things are so hot there is a big problem: India's current pace of expansion may not be sustainable.

On the face of it, the figures are compelling. India's real GDP grew by 9.2 per cent in the year to last September. Over the past four years it has clocked up an average annual pace of more than 8 per cent, compared with around 6 per cent in the 1980s and 1990s and a measly 3.5 per cent during the three decades before 1980. But the economy is displaying alarming symptoms of overheating. This implies that demand is outpacing supply and hence the pace of growth is unsustainable.


All agree that the biggest obstacle to growth of 9 per cent or more is India's infrastructure - especially its lousy roads, ports and power. According to the World Bank, the average manufacturing firm loses 8 per cent of sales each year from power cuts. India spends 4 per cent of its GDP on infrastructure investment, compared with China's 9 per cent. In absolute dollar terms, China spends seven times as much on its infrastructure.

India's government has ambitious plans to increase total infrastructure spending to 8 per cent of GDP over the next five years. This will involve some increase in government spending, but the idea is for the bulk of it to be financed by public-private partnerships. That will be hard. Private investors still shy away from sectors like electricity and roads because they are uncertain of earning a reasonable return. Only about half of all electricity generated is paid for, because power is stolen and bills are left unpaid.

Another big problem is the dreadful quality of public services, from education and health to the provision of water. Half of urban households lack drinking water within the home; one quarter have no access to a toilet, either public or private. Many public services in cities have worsened in recent years. In Bangalore water is now available for less than three hours a day, compared with 20 hours in the early 1980s. This may be another reason why workers are not moving in from rural areas as rapidly as in China.

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Go Visteon!

So am back here again after eons. Hmm lotsa cool stuffs have materialized since my last visit here. Starting with the successful return to flight mission number two and the 'privileged fate' of Sunita Williams, of the KC trend. Wondering how would it be to be in her shoes.

But the coolest of all news is that am on the rolls of Visteon Corporation - the second largest auto component maker next only to Delphi and after all, this is what I wanted to do with my life after many a things have gone wrong. So finally God heard me and here I am ready to furbish my resume with all those wonderful names - BMW, VW, Honda, Ford, Aston Martin....sends your eyes rolling eh? It has to. To me its no different than being at Boeing or Lockheed Martin - am gonna work on cutting edge stuff here too and the good thing is no clearence required. The crappy US laws can go to hell now. For those people who still dont get me - keep coming back to the blog. Perhaps you will get to know the similarities between Automotive and Aerospace.
More later. Take care ya all.

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