Disrupting The Business Software Industry

Couldn’t agree more with Aaron!

Enterprise software segment is currently dominated by big players who are in it since quite a long time. And this may inhibit new players from entering fearing that the relationship which existing software players have built over the years will be difficult to break away with. Even though relationships are no doubt important and does have a say in renewing contracts, but its not the only thing. A business is all about money and how an application can help the enterprise better utilize their resources. And this is the want or rather the need on an ongoing basis.

More often than not, it is the fear of the challenges and the learning associated with a new enterprise software which prohibits companies from changing their existing ones. To a large extent this is true. But this also shows the complexity involved and this needs to be simplified. The cost(tangible/in-tangible) of running an enterprise software seems more than the cost of acquiring it and this has to be changed and is changing. See how Google with their Google Apps totally disrupted a lot many things even though people were used to the old way of doing for years. But Google made it simple, added value, users saw benefit and they switched!

Recently there was a news that Bharti which had given a massive contract to IBM in 2004 and which is now up for renewal, may not renew the existing contract in its entirety only to IBM. Many new vendors are expected to be included, which will clearly bite into IBM’s share compared to what they got(everything) way back in 2004. This is a classic example of the state of things!

From a user/enterprise point of view, things will only get better. From a software vendor point of view, things will get more competitive and challenging!

As always, the best is yet to come!

Another Executive Churn at Apple : Bob Mansfield

So in the past 5 days, one rumor from MACRUMOUR apparently proved true and shook the tech world –  and in particular in context of Apple – again. This time its the sudden disappearance of Bob Mansfield(SVP, Technology) Bio from Apple’s website.

As this started to spread, it became more and more true and very soon the following was reported by AllThingsD :

“Bob is no longer going to be on Apple’s executive team, but will remain at Apple working on special projects reporting to Tim,” company spokesman Steve Dowling told AllThingsD.

He declined any further explanation, refusing to comment on the reasons behind Mansfield’s abrupt demotion or whether Apple plans to appoint a new SVP of technologies.

One may ask whats the big deal if some changes happened at a company’s website. Well for a public listed company like Apple, whose market cap at one point was about to hit Trillion $$$, which is by far the most high profile tech company on this planet and whose every move is closely followed, scrutinized and ripped away of thousands of journalists, web-sites, blogs etc this is no small development.

Everything Apple does there is a very strong reason or logic behind it, doesn’t matter if that reasoning or logic doesn’t make sense to the world at large. In-fact one may argue that this works good for Apple. People may think that they don’t understand why Apple is doing it, but if Apple is doing it so there should be something about it! Yeah this is RDF at work of which the foundation was laid by Steve Jobs!

What makes the news even more significant is that just last year it was reported that Bob is leaving Apple and after exactly 2 months it was again reported that he is staying back.  Well that staying back cost Apple $85 million as that was the price Tim Cook paid to make Bob stay! Even that time it was told that he would be working on “future products” and this time its “special projects”.

Apple..always surrounded in mysteries and clouded with secrets.

But there is definitely more than meets the eye. After Jobs left earth to enlighten the other world in 2011, Apple has been in the news for all the wrong reasons. Stock price getting hammered (in the last one year Apple’s stock has dipped by more than 50%), lack of new innovation and new products. iPhone 5 which was expected to be a game-changer again, didn’t even rattle anyone besides being more slimmer, more lighter and slightly bigger. iPad is more or less the same. Besides the new mini iPad, there is actually nothing new at Apple besides prosaic updates of its existing hardware line and to an extent to its software (iOS).

At the same time its biggest rival for software – Android and Hardware – Samsung is blazing on all fronts. Android subscriptions is growing exponentially(900 million +), and Samsung thanks to its S3/S4/Note series is doing exceedingly well.

This makes Apple all the more in the news in the context of lack of innovation being its biggest lacuna at the moment among others. Between the very first iOS and iOS 6 at present, there is no sea-change. Yes iOS has evolved significantly but still its more of the same. Or may be because Apple is so hell bent(good for customers!) on providing the best User Experience its very measured in the changes it brings to its users. And due to its flawless execution of changes, very soon it becomes part of our everyday mobile computing and ceases to be something new! When iPhone 5 event was announced, everyone was expecting a major change in terms of hardware, but all Apple did was made the iPhone taller thereby increasing the screen size to 4″ from the existing 3.5″ and of-course making it more slimmer and lighter, which needless to say is incredible hardware engineering at work. Combining design and technology has always been Apple’s forte though technology wise its lacking.

It is no doubt that Steve Jobs was the thread which tied Apple magically and brought the best out of people. After his demise, changes were expected, but the way its been unfolding, Jobs would be sad, very sad. First came Scott Forestall’s exit who used to head iOS development since inception and played a major role in all the Keynotes. Since then Jony Ive has taken over his role in addition to adding breath-taking value in terms of hardware design. Then came the hammering of the stock price and doubts over Tim Cook’s ability. Then Bob Mansfield exit(re-enter soon enough), no new products. Even the recent iOS-7 didn’t get as much as a positive response as expected.

Long story short, Steve Jobs is being missed like never before. Tim Cook is clearly unable to do though I am sure he is trying what is best. Of-course we have to realize and acknowledge whom he has taken over was a genius, a visionary, a game-changer in technology and his persona, his intelligence is what legends are made of! And its no easy feat to replace legends!

Problem with Apple is that it has too few people with whom the public can relate to. Barring the extremely high-profile Keynote events which happens 2-3 times a year there is not much of what we hear from Apple. Its like only during the events, 3-4 people come out of their hibernation for a few hours, then again go back till the next event and the cycle goes on. At present for me its only Tim Cook, Eddy Cue, Jonathon Ive, Philip Schiller and a recent new face in the name of Craig Federighi. Bob Mansfield was but is not part of the Leadership team.  So for a company of Apple size, just 5 people who are the face of the brand. And if any one leaves your spectrum of connect becomes even smaller. Just imagine hypothetically if all these 5 people and new faces come. Apple for me will become an alien in an instant. Steve Jobs was a marvelous brand ambassador for Apple for close to 13 years and was the best marketing/sales-person ever on this planet. Period. I remember after watching all his Keynotes from 2009, it was my dream to own its products and I just HAD to have them! One dream got fulfilled last year with the iPhone 4S…few more to go! 🙂 And just to add, every-time I use my iPhone, which is all the time I am awake, I just keep falling in love all over again! Yes it is that awesome! The reason I am NOT switching to iPhone 5 is that I am yet to get bored by 4S! So why upgrade when I haven’t had enough with 4S!

Which is why it worries me when I hear such news of executive churn. I want Apple to keep doing the magic its been doing, so that I can keep falling in love with their products!

Internally no one know what this development means, no one knows what the “special project” is, but as the saying goes, people are not great because of the great company they work in, its great people which makes the company great!

Lets hope Apple starts getting in the news more, but for all the right reasons!

 

Anirudh

1st June 2013 : Return of N.R. Narayan Murthy(NRM) to Infosys

It has finally happened! NRM has been called back to Infosys to revive what he built over two decades after the other Founders were unable to arrest the slide and its flagging fortunes over the past 18-24 months. Now to be fair the slide started to happen once S Gopalakrishnan(or Kris as he is fondly called) departed and by tradition the next Founder – S.D.Shibulal took the helms of this IT behemoth.

NRM return to Infosys is indeed breaking news, very significant and quite interesting!

As much as I was surprised, I am happy to see he being back. In-fact even NRM has expressed surprised that he was being called back! Desperate times call for desperate measures. This reminds me of Apple and how they called back Steve Jobs and as they say rest is history. But let us not get carried away! 🙂

High profile companies are always in the news and when a company like Infosys – which has always been the poster boy of the Stock Market – doesn’t do well consistently over many quarters, its even more in the news. Many people became instant millionaires in 1998 when Infosys stock got listed. Infosys headed the IT revolution which engulfed India in the 2000’s. Infosys virtually changed the economy, gave employment to thousands, gave disposable income to the middle class which led to burst of spending thereby creating growth and momentum for everyone. And Infosys did this for a long long time, almost 10-12 years. And then things started going downhill. This is what media thrives on!

Once NRM resigned as CEO, Nandan Nilekani took place and carried forward the growth  like never before, for Infosys. No wonder he was personally called by PM – Manmohan Singh to start the UIDAI  initiative for 100 million Indians!

Once Nandan left for larger endeavors, Kris took place and though he did carry forward, he was nowhere close to what Nandan/NRM. As Kris term started to end, the Infosys shine begin to fade off. And when S.D. Shibulal took place, things started to slide…unprecedentedly.

Usually Infosys has a solid track record of beating street expectations every single quarter. Its guidance (revenue estimates) is always higher than what the   market predicts. But since Shibulal became the CEO, its the street expectations which has always beaten Infosys. Its guidance are even lower than what the market predicts..on a consistent basis!

The reason why Infosys has been in the news in a negative way is not because its not doing well. It is because its the ONLY company among the top 5 IT giants which is not doing well. So if all are doing well, definitely market is not as bad as Infosys keeps saying it is. It may be bad for Infosys but not for others. And therein lies the crux of the issue.

For the first time in a long long time, Cognizant who was not even considered among the big IT companies, recently overtook Infosys to be the #2 in terms of revenue. TCS continues to be #1. And FYI when Infosys stock is down 20%, Cognizant stock went up by close to 40% in the last 2 years!

Clearly the plan Infosys 3.0 which Shibulal mentioned once he took over is not working. Whether its a problem in strategy, or in culture or in the management or all the three, this needs to be fix ASAP before the damage becomes irreversible. Even KV Kamath who is known for making ICICI the biggest private sector bank and the first “outsider” to be a part of Infosys when he took over NRM’s role in 2011 couldn’t do much as Infosys is clearly not better since he took over.

Now once this news was broken that NRM is coming back, media went berserk and different theories started to circle in all news medium. Some said its a good step, some said not very good, some said that KV Kamath was feeling the heat and it was his initiative to even think of calling back NRM, many have expressed disappointment that company rules(NRM bringing his son Rohan apparently to make him more effective, and retirement age being scaled up to let NRM come back) have been changed for this recent development. Good thing about opinion is that everyone is entitled to it, the bad thing is that everyone has one! Including me and hence you are able to read this post! 🙂

The way I see it, its definitely is a good step though it has regressive overtones to it. Firstly it clearly highlights lack of leadership in the management of Infosys which were unable to sustain once leaders started to step down as is tradition. It also reveals lack of succession planning to make sure that the behemoth which Infosys is continues to sustain its leadership among the IT companies and continues to be bellwether stock it used to be.

I am also disappointed of the tenure of KV Kamath considering his dazzling track record in the banking sector and his overall capabilities as known from media. The only time I vaguely heard from him was when the Quarterly results were out and more recently his take on NRM coming back.

Many have blamed the tradition of founders being progressed to CEO positions which limits who can lead. I agree. If they throw open the CEO position and hire an outsider, a lot will change in Infosys and a lot of those changes will be positive. Ownership, be it family/founders should always be clearly demarcated from who professionally runs the company in the interest of all involved and if its a listed company the accountability increases manifold. Culture is definitely one problem at Infosys. As good a brand Infosys is, I have always heard that working there is not all that attractive.

On the issue of increasing the retirement age, well yes technically these rules should be binding to one and all but if a future of a company is at risk in the largest interest its best to change the rules if mutually accepted to all involved. On bringing his son Rohan as an executive assistant, I really don’t see the fuss in it. Its not that he is now part of the board or in the top management. Its been long time since NRM was involved in the day-to-day running and since he is been working with his son(Catamaran Ventures) for sometime, if he feels his son will add value and make him more efficient, so be it.

Top most priority is to arrest the slide and get Infosys on the growth path which is used to be it. Of-course all this within the ethics/values of Infosys and as mandated by the govt.

To conclude, I am happy that NRM is coming back. If it benefits all including its shareholders/investors, why not!

 

Anirudh

Disclaimer : I don’t own a single Infosys stock!

 

CEOs, Get Out of the Way!

http://blogs.hbr.org/hbr/nayar/2012/05/lets-just-get-out-of-the-way.html?referral=00563&cm_mmc=email-_-newsletter-_-daily_alert-_-alert_date&utm_source=newsletter_daily_alert&utm_medium=email&utm_campaign=alert_date

Very well articulated by Vineet Nayar(CEO, HCL Technologies Ltd.)

In today’s uber fast-changing age, its the employees(specially new recruits) who have the inclination to change if something is not right and/or improvise the current systems. Ideally the top management and people hanging on to their cosy chairs must acknowledge, appreciate and apply feedback. Of-course not every feedback may be in the interest of the organisation, but if majority is saying the same, there has to be some truth in it.

Organisations who stay in the past, will soon become a thing of the past!

P.S. – I just commend Vineet’s approach to employees, how easily he is approachable and trying to connect with his employees first, through various mediums! 

Recommended Read : Managers Don’t Really Want to Innovate

http://blogs.hbr.org/ashkenas/2012/05/managers-dont-really-want-to-i.html?referral=00563&cm_mmc=email-_-newsletter-_-daily_alert-_-alert_date&utm_source=newsletter_daily_alert&utm_medium=email&utm_campaign=alert_date

So true in majority of companies!