Sunday, June 30, 2013

C-DOT Gets a Second Life, but will it be successful?

India has seen a telecom boom over the last decade and today has 700-800 million mobile phone connections. But, though thousands of crores of investments have gone into creating the infrastructure for telecom services in India, very little of the equipment has been sourced from, or manufactured in, India.

Why has this happened? The simple answer is that we failed to build up a competitive telecom equipment manufacturing industry in India. Till the 1980s, telecom was a public sector monopoly with the Indian Telephone Industries (ITI) set up to manufacture exchange equipment and telephone instruments. ITI followed the traditional model of sourcing technology from other countries/companies and manufacturing products under licence. Though it had its own R&D, it never succeeded in developing good products of its own. ITI’s woes were compounded by poor decisions on technology and investment – for example, ITI set up a crossbar exchange manufacturing facility in Rae Bareli just when this technology was being phased out elsewhere in the world. Later, ITI’s first move into modern electronic switching systems was located at a new plant in Mankapur (UP) which had absolutely no ecosystem to support it.

C-DOT: History and Achievements

The first serious effort to build indigenous capability in switching technology was the creation of the Centre for Development of Telematics (C-DOT) in 1984. Under the leadership of Sam Pitroda, C-DOT took on the challenge of developing Electronic Private Automatic Branch Exchanges (EPABX), Rural Automatic Exchanges (RAX) and Main Automatic Exchanges(MAX) suitable for Indian conditions (high temperatures, high dust levels, poor handling, power fluctuation, etc.) at low cost. While the first two were developed on time, and were comparable to the best in the world at the time they were developed, the MAX (a much more complex project) took longer, though it was ultimately able to meet the specifications of the then monopoly Department of Telecommunications (DOT).

The main impact of C-DOT’s technology was ushering in an era of nation-wide connectivity, providing the base for the huge network of “STD booths” that dotted the country by the late 1980s. The low prices of C-DOT’s equipment resulted in multinational telecom vendors lowering the prices of their own equipment as well. C-DOT played a stellar role in building local skills and capabilities – in the 1980s (remember this was before the software and IT revolution took root in India), C-DOT provided challenging opportunities for Indian engineers, and C-DOT projects were the first large projects where structured software development processes were used.

In its early years, C-DOT benefited from the relationship its charismatic founder Sam Pitroda enjoyed with Rajiv Gandhi. C-DOT got sufficient funding to develop its equipment, and was allowed flexibility in its organizational arrangements to pursue its mission. But full credit should go to Sam and his team for demonstrating the ability to develop complex products in India at a time when local capabilities were limited.
However, Sam’s rapport with the Congress government proved a mixed blessing when the Congress lost power and was replaced by the VP Singh and Chandrashekar governments. He was literally hounded out of C-DOT.

After completing the MAX project, CDOT went through tough times. Apart from the shift in economic philosophy of the country, the telecom environment in India changed, with the shift from the DOT (now BSNL) to private players; from fixed lines to mobile; and to convergence of information and communication technologies. It’s not surprising that CDOT found it difficult to cope with these changes. Globally, the telecom equipment industry also suffered serious convulsions after a peak during the dotcom boom resulting in bankruptcies (Nortel), consolidation (Alcatel-Lucent, Nokia-Siemens) and the birth and success of new players, particularly from China (Huawei, ZTE).

C-DOT: Second Life?

So, I was pleasantly surprised to find that C-DOT is today getting a new lease of life under the leadership of VVR Sastry (former CMD of BEL) and Vipin Tyagi. My first meeting with Vipin was fortuitous – we were fellow speakers at a seminar organized by a Ghaziabad college last year. We had some sporadic correspondence after that. I finally got an opportunity to visit C-DOT and interact with some of their people when I was invited to speak at a C-DOT internal symposium recently.

In terms of hard infrastructure, I must say that the government has provided the best to C-DOT. It has a fully-equipped, modern campus in South Delhi, a far cry from the rented premises where C-DOT used to operate earlier. I was impressed by the motivation and expertise of C-DOT’s young engineers – they look very committed to the challenging tasks they have at hand.

C-DOT’s bigger challenges today lie in the areas of strategy (technology, product choices) and business models. The current leadership of C-DOT has made some focused choices that make sense: upgradation of the existing installed network of 30,000 RAXs (which were built essentially for voice) to handle data with contemporary technology; a Shared Radio Access Network, which will allow upto three operators to share infrastructure, thus bringing down the cost of rural wireless access; and a Data Rural Application Exchange (DRAX) which helps provide people who are not computer savvy access to broadband information and services. A major thrust of work is on C-DOT’s GPON family of products, optical networking products that will create the long term backbone for advanced digital data access. (Picture below shows Vipin Tyagi and I standing in front of one of the GPON products.)

Many of C-DOT’s current products have an Indian flavor – they are designed to meet Indian requirements but incorporate current technology and have a low cost base. This is a good approach, one that is being followed already by leading Indian telecom players like Tejas Networks (see my earlier post) and even multinationals like Cisco (see another post on ASR901, Cisco’s successful cell site router, developed by Cisco in India). But, what is still not clear is how will C-DOT’s technologies and products reach the market?

Will C-DOT Succeed?

C-DOT is following the same approach they followed earlier – licensing their technologies to multiple Indian companies, who will then take them to market. I wonder whether this will work. In the case of C-DOT’s earlier switching products, remember that they were developed at a time when self-reliance was an official policy of the government, and there was a single (monopoly) telecom services provider owned by the government. Today, there are multiple service providers across the country, and the state-owned BSNL and MTNL are both in poor shape. Competition is fierce and there are frequent allegations of some multinational vendors “dumping” their equipment in India. It is not clear as to how C-DOT’s licensees will deal with this challenge. Pre-qualification requirements (such as proof of operation in networks for a defined duration) that were earlier used to delay and thwart the induction of IIT Madras’s TENET network’s solutions may come up again. And, though the new Preferential Market Access norms for products manufactured in India have been announced, it’s anyone’s guess how effectively they will be implemented.

I always felt, and continue to believe, that we made a major mistake in our failure to create one or more integrated telecommunication equipment companies. ITI never had distinctive technological capabilities of its own; but C-DOT as a technology organization always remains one step away from the market. This prevents it from dynamically responding to market and technology changes. It is instructive to remember that most Chinese companies had their origin in government laboratories, and were the result of spin-offs from these laboratories.

Today, it is not essential for a technology organization to do manufacturing itself. Most companies using electronic technologies (including iconic companies like Apple) rely on specialized third parties like Flextronics or Foxconn to take care of manufacturing. But decisions on technology, brand, products, marketing and pricing need to be taken under one roof in order to be competitive in a fast-changing marketplace. The licensing model doesn’t support such an approach.

C-DOT looks poised to create great technologies and products. But will these reach the marketplace?

Sunday, June 23, 2013

Can Higher Education Drive Social Change? The Case of Ford Foundation's International Fellowships Program

In just a week from now, the curtains will close for the last time on the stage of the Ford Foundation’s International Fellowships Program (IFP), an ambitious effort to use higher education to promote social change. Under the IFP, agents for social change from a variety of disadvantaged backgrounds from 22 countries were provided scholarships for postgraduate education to some of the best universities in the world. The goal? – to equip them with the confidence, perspective, and tools to enable them to return to their communities and play a much more impactful role in their transformation.
India was a major participant in, and beneficiary of, the IFP. 330 outstanding individuals from India were granted the Fellowship since its inception in 2000. They come from parts of the country with the greatest challenges, and most of them faced multiple dimensions of disadvantage arising from caste, religion, gender, economic deprivation and physical disability.

My Exposure to the Potential of the IFP

I had the good fortune to experience at close quarters the potential benefits of a programme like the IFP. In mid-2009, the director of IIM Bangalore asked me to set up a structured mechanism to support the students admitted under India’s Persons with Disabilities Act. I started off by looking at what other leading institutions in India had done in this respect, and visited the Jawaharlal Nehru University in Delhi which had what was believed to be the most comprehensive infrastructure for disability support. But we figured out the most appropriate way of creating better access for students with disability only after I met Meenu Bhambhani at a meeting of the CII Karnataka Disability Forum.

In just a few minutes of discussion with Meenu, I found that she had in her head the entire blueprint for the creation of an Office of Disability Services (ODS). She saw the ODS as the nucleus for providing students with disabilities an educational and life experience on par with what other students received. Not only was Meenu keen to share this with us, she went one step further offering to provide seed support from her company to help us set up an ODS at IIMB. Over the next few years, Meenu was our mentor for the ODS as she goaded, coaxed and prodded us to set it up to the highest standards.

Meenu is one of the 330 Indian IFP Fellows. As part of the IFP, she did a Masters in Disability Studies at the University of Illinois, and that’s where she not only learnt about how an ODS works, but also saw one working at first hand. Before IFP, Meenu was an Assistant Commissioner for Disabilities in her home state of Rajasthan where she struggled to overcome bureaucratic constraints to make an impact. Today, she is the head of CSR for a prominent IT company, and she has spearheaded the creation of a disability-friendly workplace in her company resulting in it becoming one of the biggest employers of persons with disability in India. She has taken up the challenge of making India’s elite institutions of higher education disability-friendly, and after working with us at IIMB has shifted her attention to other highly ranked institutions.

If Meenu’s experience is anything to go by, programmes like the IFP have tremendous potential to be successful as catalysts of social change. But that didn’t happen by chance.

IFP Design

The IFP’s India office has recently published a wonderfully inspiring book titled Opening Doors that documents the philosophy, objectives, process and outcomes of the IFP in India. A few features of the IFP stand out:

  • A four stage rigorous yet empathetic selection process to select the most appropriate candidates for the Fellowship. I was impressed by the efforts they took to spread information about the fellowships across the states they targeted. And, to uncover the potential of individual candidates. They realized, for example, that for people who grew up amidst considerable hardship, prior academic performance may not be a good indicator of scholastic aptitude and ability to cope with a challenging academic programme.

  • Careful matching of Fellows to academic programmes and institutions. The IFP office in India worked one-on-one with each selected Fellow to identify the courses that would best suit their interests and domains of activity. They then worked with each Fellow on the entire application process.

  • Elaborate preparatory coaching and study. Each Fellow spent several months on filling gaps in their knowledge of English and academic subjects prior to leaving to the University where they had been admitted. Fellows were also coached on how to adjust to a different culture, and about social etiquette in that country. All these efforts were very important because the Fellows had been out in the field for a long time after their initial degrees and were therefore not immediately ready to step into a graduate classroom in the US or UK.

  • Close mentoring and continuous support. Not surprisingly, in spite of the careful preparation, many of the Fellows experienced serious challenges when they entered academic campuses in the developed world, as the expectations and experience were quite unlike anything they had seen before. Many of them also had to cope with personal challenges such as deaths of close relatives while they were pursuing the Fellowship. The IFP India office played an important role as loco parentis in helping the Fellows weather these challenges.

Some Reflections on Higher Education and Social Change

Higher education can undoubtedly benefit individuals. It is a powerful vehicle for economic stability and social advancement. That’s the rationale behind the scholarship programme of the Foundation for Excellence, an organization that I have had the privilege to be associated with. FFE provides scholarships for undergraduate education in engineering and medicine to students with outstanding academic backgrounds but disadvantaged economic circumstances. We have seen how FFE’s scholarships can transform the lives of these students and their immediate families.

But can higher education of an individual have a large societal impact? The designers of the IFP believe the answer is “Yes.” The short essays on individual Fellows in Opening Doors, and the survey conducted among the Fellows suggest that the opportunity to study in a high quality graduate programme outside India gave Fellows an opportunity to reflect on their lives and aspirations in a completely different setting. This allowed them to take a fresh perspective and re-calibrate their expectations of themselves. The experience not only sharpened their ability to think critically, but also gave them a new set of frameworks and tools that would enable them to enhance the scope of their impact. More than anything else, it increased their confidence and motivation.

While it’s still too early to do a detailed cost-benefit analysis of the IFP, if Meenu’s experience is anything to go by, it has changed the canvas on which Fellows can paint and the arena in which they can play. I, for one, will be watching with considerable anticipation, how the IFP India Fellows evolve.

But, to end on another more sobering note, I really wonder – when will educational institutions in India be able to provide an educational experience similar to what the IFP Fellows received in the US and the UK? Will that happen in our lifetimes?

Monday, June 10, 2013

Guest Blog: Hamsini Shivakumar on Innovation and Branding

Hamsini Shivakumar is a co-founder of Leapfrog StrategyConsulting, a firm that focuses on informed imagination for breakthrough solutions. She has more than 25 years experience in premier marketing and advertising companies like Procter and Gamble and JWT.

Innovation without strong branding is incomplete

In this blog post, I wish to put forward three ideas for intending innovators in India, to consider.

a)       A supply gap is not a demand gap. 
b)       Innovation without strong branding is incomplete.
c)        Even a radical innovation, which by definition is highly differentiated, needs to be well positioned and well branded to generate demand and grow consumption. 

In my experience, many professionals and entrepreneurs in India are good at spotting ‘gaps’ in the market.  However, the problem is that these are often supply gaps, spotted due to the entrepreneur extrapolating from his/her personal passions or capabilities.  As India is an under-supplied country in many areas still, it seems perfectly reasonable to believe that supply will generate demand automatically.  Or that it is a matter of concept ‘selling’, viz, pushing hard(er).

A couple of examples will illustrate this point.

E.g., I am interested in coffee being from a coffee growing area or agriculturist family, I travel abroad and see some specific types of coffees or coffee making products and I think to myself, these are not available in India, why not be the ‘first mover’ / ‘innovator’ to bring these in? 

E.g., I travel in the interior villages of UP, see how people struggle with power cuts and shortages and think, why not provide them with solar lamps – as far as I can see, solar lamps are not easily available here. 

E.g., I see full families travelling on two wheelers and think there must be a market for a Rs. One lakh car, if only someone were to make it. 

E.g., I see that there is no forum or portal for marketing knowledge to be shared and discussed, so I propose to launch India’s first and only marketing portal.

All of these ‘well-spotted’ supply gaps talk to the entrepreneur and innovator’s need to blaze new trails, be a pioneer, do something innovative which has not been done before and hence is exciting, with the seeming potential to grow into a big business over time.   

The million dollar, unanswered question at this stage is, will there be demand for this innovation?  And assuming that the innovator team could identify a set of potential target consumers for the innovation, would those consumers be able to give a reliable answer to the question of whether they would want this innovation or not – when they can’t see it, smell it, taste it or know it in a concrete way; hence clearly appreciate the value that it can bring to their life, vis-à-vis existing alternatives.  Concept testing may be valid for known categories and established markets, but does it really work for the radical, the new, the somewhat unknown?

With these thoughts in mind, the innovator often has to make a bet and get down to the hard work of translating the idea or concept into a product or service which can be launched into the market.  And that is what he/she does, with full enthusiasm, often cheered on by an excited media audience.

However, the potential consumer for these innovations, sitting at the other end, is oblivious to all this new supply that could enter his/her life and is going about his-her life in their usual way.  Which means that the innovator has to think harder about who is exactly the intended consumer and why would he-she want it compared to his-her existing alternatives.  The innovator must be prepared to be surprised because, experience shows that demand for the innovation can come from unexpected places and the market for the innovation could be built in unanticipated ways.  And sometimes, in fact, very often, as the track record shows, the innovation that has been created with so much passion, effort and commitment meets with a cold reception and the consumer demand-market potential turns out to be far less than was imagined it could be.

One of the key reasons that the supply gap sought to be filled by the innovation does not translate into high demand is that the innovator believes that his creation is new and different enough to sell itself.  Or rather, if ‘sold’ through distribution channels, the demand is bound to grow.  However, a critical step between the innovation converting to demand is not marketing and sales, but positioning and branding.  Even a unique product or service, has to attract potential customers through perception enhancement viz branding.  It not only needs an attractive name and identity, it also needs to be well-positioned with an attractive image, to draw its target consumer.  It has to reflect the aspirations of its consumer and align to the cultural current of the place and time.  It needs a communication campaign and a conversion strategy that will translate interest into purchase.

Two types of errors lead to misguided positioning of the innovation.  The first is the innovators passion and conviction that he ‘knows’ the customer and what the customer needs, better than the customers themselves.  Linked to this, is the unwillingness to be classified and compared, looking through the eyes of the potential customer.  The pioneer is resistant to accepting that in the buyer’s eyes, his innovation may not be so radical or unique after all.  Or if its uniqueness is perceived and accepted, the buyer is unsure about what to do about it, given that it is so new and unfamiliar.

One of the common views of branding as image is that it is akin to stylists who dress the stars and give them the most attractive ‘look’ for the context of their appearance.  However, in reality, positioning a brand is all about classification and framing.  It is about understanding the mental classification and categorization that the prospective buyer makes and the conclusions and emotional meaning that he assigns to the innovation based upon that categorization.  If this is not properly understood by the innovator and his campaign team, not enough time, attention and effort is given to this stage.  The launch team follows the direction of the innovator in defining the positioning, sometimes this can be right and sometimes it can be spectacularly wrong.
These errors of judgment by innovator teams, of mis-positioning their innovation, are not just what individual entrepreneurs can make, they can be made by large corporations too.  The Tata Nano is a spectacular case study that illustrates the above.  The Nano is a radical innovation in cars, the first of its kind in the world and so on.  However, the consumer who it was intended for, the first time car buyer in India, rapid upgrader from two-wheelers, was left under-whelmed by the launch positioning of the brand.  It had to be re-positioned with a young and trendy image; sales are still less than anticipated.  This happened despite two years of media coverage from all around the world.  In the case of the Nano, mis-positioning issues were compounded by product safety issues as well.  Godrej Chotu-kool, a small, battery-operated refrigerator intended for small town and rural markets is another case in point.

Thus, in my view, the company that intends to move from opportunistic growth strategy or the ‘jugaadu’ approach to sustainable innovation as a source of competitive advantage must be willing to invest its efforts in two directions:

  •              Develop processes for innovating more consistently
  •       Give importance to completing the offering to the consumer, through adequate focus on positioning and branding.  To get this right, setting aside innovator ego and having adequate humility to respect the consumer and potential buyer’s perception and value frames is a must.

Saturday, June 1, 2013

Digital Republic:India's RIse to IT Power

I first learnt about Dr Mathai Joseph (MJ) some 7 or 8 years ago. An article he had written on the nature of innovation in the IT industry popped up during an internet search. From what I remember of this article, he had argued that innovation in the software services industry was application and customer-oriented and therefore not like conventional R & D. At that time MJ was the director of the Tata Research Design and Development Centre (TRDDC) at Pune and I could sense from the article that he had more than the average IT company manager's insight into the dynamics of innovation.

 So, when Sanjiva Prasad, a good friend and distinguished professor of computer science at IIT Delhi, recently introduced me to MJ and suggested that he send me a copy of his new book, I was quite excited. Particularly by the title: Digital Republic: India's Rise to IT Power. At the same time I also wondered what fresh insights he had to offer - after all, the success of the Indian software industry (and its limitations as well) have been studied from every imaginable angle.

Once the book arrived, a part of the mystery was solved. "History and Memoir" is the second sub-title of the book, at the bottom of the cover, just above the author's name. MJ got into computer science somewhat by accident, it appears, after he completed his MSc in Physics in Bombay and entered a newly-founded programme at Cardiff. The enthusiasm of the faculty there rubbed off on him, and by the time he finished this Masters course, he wanted to learn more. He was admitted to a PhD programme at Cambridge where he worked with some giants in the then fledgling field.

I found the section where he describes how his supervisor allowed him to find his own feet and interests, and yet guided him gently to enhance the rigour of his work a wonderful lesson in socialization into the research process. This section also brings out how the pioneers of computer science and engineering strove to shape their discipline into a more scientific one. This would be useful reading for any research-inclined computer scientist even today.

TIFR and Warwick

After completing his PhD, MJ moved back to India to work at TIFR. MJ harbours mixed feelings of this period - pride from some significant achievements, but also rancour from the refusal of the "pure" scientists at TIFR to give computer science its due. This dissatisfaction ultimately led MJ to seek greener pastures at Warwick University. He clearly enjoyed his time there even though he now had to teach large classes and contend with the university bureaucracy. I didn't, however, get a sense of what was distinctive about Warwick - in engineering and management it is known for its strong application orientation and corporate relationships but I couldn't make out whether this held true for computer science.


After a decade at Warwick, MJ returned to India to head the TRDDC which was being seen as an important R&D backbone of TCS. Over the years, several prominent Indian researchers have made TRDDC their home - EC Subbarao, doyen of Indian materials science is one, Keshav Nori, a prominent computer scientist is another. MJ's account suggests that his role was to bring more focus to its activities, and in particular to align it with the business of TCS. He also enhanced the research depth. But I was hoping to learn more from this book about what TRDDC really does, and what it should be doing in the future. I was disappointed by a lack of in-depth discussion of this.

In fact this leads to my major grouse about this book. It’s long on charming memories of MJ's life, but short on details related to the book's title. MJ is a good raconteur and I can see that his interest in poetry and literature right from his college days have had a positive impact on his ability to tell a good story. But his observations on the IT industry in India provide few fresh insights. India's failure to understand the true potential of computers; restrictive policies on imports; and waking up late to the importance of software - all of these have been documented extensively and well elsewhere.

An Open Appeal to Dr. Mathai Joseph

I really hope that MJ puts his powerful mind and pen to address what should be done to enhance research and development in computer science and information technology across academia, industry and government in India. With his unique set of experience at TIFR, Warwick and TRDDC/TCS, I can't think of anyone more qualified to do so.