The Price and Prize of Social


When I read my friend Howlett’s blog on social enterprise – I had plans to write something on my blog too, but that feeling passed. I am not going to make any generalizations on social – just talking about my own case here. I will come back to the social enterprise topic some time in future.

Compared to many of my friends, I have been a late entrant to the whole social thing. And compared to many of them, I am still a lot less active on social media. Yet, I am way more advanced and active on social media than 99% of people I know. Has it helped me? yes, it has to some degree – both in my career and in my personal life ( and the distinction is lesser between the two today than even 3 years ago). But it has taken a toll too for sure in my personal life.

I started a personal blog around Christmas of 2010 – but became relatively active only about a year ago. I try to blog once a month at least – but have written about 8 posts in some months. Most of my posts have been in and around SAP and BI , but I have also written on politics, economics, food, sports and dogs. Pretty much any topic is fair game for me if there is a strong opinion I have on it.  And when it comes to opinions, I usually only have strong ones – for better or worse 🙂  .

I enjoy blogging as a medium to express my thoughts. And I have an explicit disclaimer that what I say is just personal opinion and not my employer’s opinion. But this does pose some challenges on occasion.

For example – at least partly due to blogging, SAP recognizes me as an influencer. And due to that I get some information earlier than others, and SAP picks up my T&E to attend some of their events, and I appreciate that. I try really hard to keep confidential info as confidential. But on the other hand it does not stop me from criticizing SAP on occasion.  The people who run the SAP influencer program, and senior SAP executives who talk to me have never told me what I should or should not write. But few others – including many friends – at SAP have often told me directly or indirectly that I am spreading too much negativity. I value their friendship – and I feel terrible when I hear this, since that is not my intention.

While I have no great  interest in happy talk  – I do say good things whenever I see it. And at least for HANA – me, John Appleby, Vitaliy, Harald Reiter and a few others do a lot for promoting and clarifying questions on Hana via our presence on twitter and SCN. And while I learn a lot from SAP during my interactions with them – I also pass on feedback from what I see on the field back to them. So hopefully things balance out some how from SAP’s perspective.

On career front, social in general has helped me. A large number of IBMers know me better via twitter and my blog , and it has helped me a lot in maintaining a very valuable network. I get to advise my clients better too since I have access to more people and information now due to social. I have won business in my day job thanks to name recognition from social media. And in general my managers have been quite supportive of me being active on social media. In return, I try hard to make sure there is no impact to my performance at work.

The biggest prize for me is the content I get from people like Jon Reed and Dennis Moore who curate the zillion tweets and blogs and send out high quality information. If it ever becomes a paid service, I would gladly pay for that. I would have never had a chance to get all this information without their feeds.

But for all the Prizes, I have a price to pay.  A day still has only 24 hours – and it means I am in front of a computer (or my phone) longer than I used to. And that takes time away from my family and my hobbies. That is NOT good – and is not sustainable.  So I have cut back on my social presence quite a bit. And I am sure I will overcompensate and will need a lot of time to find a good equilibrium.

If any one has a 12 step plan or something to find that equilibrium, please let me know.

Indian Political Economy – a crazy balancing act


When Pranab Mukherjee was selected as the presidential candidate by Congress, the first thought that crossed my mind was that Manmohan Singh can now do something right about the economy.  But given elections are just 2 years away – I seriously worry if populist measures will overtake good economic decisions.

India is a diverse country, and is not known to elect a politician based on economic brilliance. There is a good reason for that – the wealth accumulation is only with a small percentage of the population. Not enough votes will come in any constituency from those rich people. Added trouble is that several of the “haves” choose not to go to voting booth on election day. Lot of other things win elections – religion/caste , free benefits from government , subsidies and so on are the messages that win elections. The one other thing that wins elections is fierce loyalty to some political families.

The loyalty factor is kind of silly when taken to extremes. The most obvious case is the “Gandhi” family. Jawaharlal Nehru was India’s first prime minister. There were many other capable and eminent people who could have been the prime minister – but Gandhi liked Nehru the best. Nehru ruled several years, his daughter Indira Gandhi ruled several years and her son Rajiv Gandhi ruled after that. The current chief of Congress is Rajiv Gandhi’s wife, who is an Italian by birth – Sonia Gandhi. Her son Rahul Gandhi is an MP, and at some point after Manmohan Singh’s tenure – he will surely rule the country.  Every opportunity they get, the congress leaders will make a shout out for Rahul Gandhi to be the next Prime Minister.  What might not be well known to people outside India is the fact that Indira Gandhi had no blood relation to the father of the nation M.K.Gandhi. She took the last name of her husband Feroze Gandhi . You might wonder if a country with a billion people can only be led by one family. Well – that is how India works for the most part.

Economics in India from the time of Nehru was based on socialist principles. It led to what was called License Raj. Government decided which companies can get a license for what business, regulated prices, prevented lay offs etc. Nehru and his finance ministers wanted a “planned economy”.  C Rajagopalachari was an opponent to this idea – and the term license Raj was his creation, with a reference to the British Raj that India suffered through many decades. I think Nehru probably did not want a pure USSR type model, given that private business houses did flourish in India. But this policy led to India never exploiting its potential for 4 decades. I can be wrong – this was all before I was born, and my knowledge is all through reading and college classes and so on.

Wealthy families with ties to politicians got many such licenses.  And just like politics – business also had a few “first families” who grew by leaps and bounds when the rest of the country suffered.  Preamble to Indian Constitution states that it is a socialist republic. And a challenge in supreme court to change that was turned down. Not sure how many people remember this – but it was Feroze Gandhi who first unveiled a lot scandals involving business houses and politicians – including the LIC scandal that gave the Nehru Government its first black eye.

So throughout the first 40+ years of independence, India had a very closed economy.  The current Prime Minister Manmohan Singh was a Reserve Bank Governer and then the Dy Chairman of planning commission in the 80’s. So he has seen first hand the mess associated with the closed economy and failed policies. When he was brought into the parliament on a congress ticket, he was whom Narasimha Rao chose as finance minister.  He was the FM till 1996 – I remember that clearly since that is when I finished my college. It was fascinating to see several economics lessons from childhood being banished by a visionary Finance Minister and Prime Minister and the economy being opened up.

Looking back, I can imagine why Nehru and his colleagues believed India needed to depend on internal markets for its development. Their generation had to fight all their life to end the British rule in India. And British, and many others came to India on the pretext of trade. So international trade probably was not the most palatable thought for those leaders.  But since rupee was not convertible – there wasn’t a lot that private citizens could do in case they differed with the government’s idea of how an economy should work.

Although I did not realize at the time – I now believe Rao’s and Singh’s hands were forced.  And to give credit where it is due – the idea of reforms started with Rajiv Gandhi, although  the execution of the reforms only started with Rao in power.  There was practically no forex reserve in the country at a time in 1991 that India pledged Gold and got a bailout by IMF. Smartly, the government moved swiftly in deregulating most industries. They did stop short  of making this 100% liberalized – defence, alcohol etc continue to be regulated.

When Manmohan Singh was RBI Governor, Pranab Mukherjee was the FM. All I remember about that time is that they managed to not draw the last installment of the IMF loan that was available to them – which is admirable.  So, essentially Pranab was Manmohan’s boss. Fast forward to the time Pranab was the FM in Manmohan’s cabinet – and Manmohan was his boss, at least in theory. I don’t think he really deferred to the PMO on anything related to Finance.

Manmohan Singh never contested a Loksabha election. He was always nominated to Parliament through Rajyasabha. I think it was a wise move on his Party leadership’s part. He is not a politician – he is an economist and an administrator. There is no guarantee that he would have won an election had he contested. Pranab on the other hand is a career politician.  His genius in politics is at the same level as Manmohan’s is in economics.

His tenure as FM was not the best this time around – especially the retroactive taxation that he pushed through that was horrible , and drove a lot of investment away. Proof of the pudding is in the eating – and that pudding is not sweet any more. The economy is not growing all that much – and a lot of blame rests on the FM. And this is what Manmohan Singh needs to clean up, and in quick time.  When Pranab quit as FM to contest presidential elections, Congress seems to have decided to keep the FM role with Manmohan Singh as an additional responsibility. India needs an economist in that driver’s seat now. This is a great decision.

There are many areas where some action needs to be done quickly. With a coalition ministry, I wonder if there is a lot he can get away with, but here are 4 things that come to top of my mind .

1. Government Spending – this is not a new problem by any stretch. But it is out of hand , and it needs to be trimmed.

2. Tax reform – even if nothing else gets done on this front, the retroactive taxation policy should be killed pronto. Without that, there is no way more capital will flow into India

3. Cutting subsidies – probably going to be the hardest to do in India, especially with elections due in 2 years. There is very little chance that Manmohan Singh will be PM next time due to his age, so now might be a good time to bite the bullet and get it done.

4. Controlling inflation – when some things are regulated and subsidized, and some are not, it is hard to both grow and minimize inflation.  For example – If the LPG and Diesel fuel subsidy goes away, prices of everything will increase overnight. It will take some time for the market to find its equilibrium. On the other hand, if it is not done – growth will be affected.  Hard to balance when election is just 2 years away.

The next 2 years will be interesting to say the least !

 

 

 

 

Shelf life of innovaton


To begin with – I wonder if someone will argue with me if I just say “there are only so many original ideas in this world”.  I am sure someone would – I can think of a few people I know on social media who hold a different view. In any case – I firmly believe original ideas are limited.

But is innovation a term to define an original idea? I am not sure – partly because I am not a scholar in English language.  I cannot draw a firm difference between invention and innovation when it comes to an original idea. The idea of invention and innovation is to improve something in general.

If someone comes up with a cure for cancer – we will probably call it an invention. And when the next person comes up with an even better way to cure cancer – it gets called an innovation, or less charitably – an improvement. And the judgement passed on this is not done by the cancer patient who got cured or the doctor who treated the patient. It will be done by authors, analysts, scientific community etc – all of whom are a degree or two or more separated from what actually happened. Whether we call it invention, miracle, innovation, minor improvement or a waste of time and money all depends on the eye/tongue/keyboard of the beholder.

What is innovation then?  It is a comparison to status-quo, isn’t it? If I do something better today than yesterday, I have done some innovation. But will anyone other than me agree that it is innovation? Should I wait to call it innovation till I find a few more people to agree with me? If making money is key – then yeah, I suppose a few people should agree with me. These should be buyers, people who influence buyers etc.  This also explains why vendors shout out about innovation before any customers benefit from their wares. Good for them.

What is forgotten in this dialogue (err..monologue since I am the only one “talking” here now) is the time dimension of innovation – or more accurately, the shelf life of innovation.  So I and a few others get to agree that what I just produced can be called innovation.  And someone is willing to pay money to get it. As time progresses, I keep tweaking my product (to keep getting some money to earn a profit, to fund new projects, to go to Australia to watch a boxing day test match and so on) . Will each tweak be called innovative? Or because I did innovation once, will I continue to be known as an innovator?

From the money point – there are two ways I can make money. I can charge money for tweaks by charging a maintenance fee (the type SW companies do) or I can bring a new version every now and then and convince customers to (optionally) pass down old ones and buy new ones (like car companies, Apple etc do).  As a customer, I prefer the former model where I get everything I need for a smaller price tag every year, as opposed to spending money (equal to or more than original investment)  again to buy the next version.  Companies who charge a maintenance revenue are tagged with “improvements” and companies that make you buy the new version all over again are tagged “innovators” or even “inventors”.  Am I the only one who thinks this is strange?

For me as a vendor – if making money is my prime objective, the latter model is probably better.  Of course I cannot do this one product – I will need a portfolio of products so that no one product can sink the ship if it fails to sell. I also need a brand that holds significant value and loyalty. Car companies and Apple have proven that this is a workable model. I have several friends who have bought iPads every time Apple had a new model. I also know many friends who for generations have bought Chevy, Ford or BMW.   I don’t have any friend who buys cars from Chevy, Ford or BMW every time there is a new model though 🙂

This model is rarely seen in software side. The successful companies like IBM, SAP, MS all have made excellent software – used by millions of users for their daily jobs. Their solutions have long shelf life. And they charge a maintenance fee to provide improvements and support over time.  They also come up with new solutions that fetch more upfront money than the annual maintenance.  But since they don’t make people buy new models every few months – they almost never get any credit for innovation like Apple from the analyst/blogger community.

The criticism on”incremental-ism” is not without merit – customers are not always given sufficient “big enough” changes all the time. Vendors need to address that. However – it is not as if customers use what is available already all the time either. If I take SAP as an example – very few customers take time to find out what is available to them in Enhancement packages that they can use to improve their business process.  And only a few go on all the way to implement it unless forced by laws and regulations etc.  Vendors know this – so they strike a balance on how much they will improve existing products vs invest in new ones. Of course when they come up with new ones – there are people (like me) who will question its maturity.  There is no easy answer here.

One last thing – adding “disruptive” to innovation. I believe this idea of “disruptive innovation” came from Clay Christensen.  I do agree it is a neat idea. Where I differ from some other people is the frequency at which disruption can be done without losing efficiency of doing business.  I cannot get my head around the notion of a business surviving technology disruptions every year in the name of innovation. But listening to some experts on the topic – and resisting the temptation to name names – I constantly get this feeling that they expect customers to be friendly to this idea of constant change.  I know a CIO who had to fight more than a year to convince his company to let go of on-premises MS office and go to a cloud based office 360 solution. I doubt he can fight 5 such battles a year.

Just when I was all tired about the innovation – I spoke to an ex-colleague on phone. He says that the need to be innovative is so yesterday. His company is now moving on to be inventive.  That is the new cool kid now it seems. At least can we go back and talk about “Synergy” or something again , or is retro not cool anymore either?