René Seifert

Entrepreneur, Global Citizen, Flat World, Internet, Web 2.0, Innovation, Start-Up

Archive for September, 2007

Beautiful Udaipur

Just a few lines which I write from the business centre of the Hilton Trident Hotel in Udaipur, before heading off to our tonight's gala dinner. Udaipur and Rajasthan as a state in whole are beautiful and indeed entirely different from South India where I use to roam aroun for the last 3.5 years. The landscape is much more dry and full of hills. Today we went to the City Palace of Udipur and for lunch were hosted in the ambience of a Palace Hotel one hour out side of the city. I understand pretty well why Rajasthan is the most popular State among tourists coming to India. It expells a particular charme which allows to explore something new when you think that you've seen it. I took some quite nice pictures and I am happy to share them next week when I am back in Germany.

Between Oktoberfest and EO Retreat

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I am well on track with this year's Oktoberfest (="Wies'n", the Bavarian term). Out of 6 days, I went there 7 times (on Sunday twice ;-). Yesterday was also big fun with a bunch of great people working for a travel website operating out of Munich. 

Looks like I will have some lunch on the Wies'n today with Josal, a very good friend of mine, go back to the office for some work before I leave to Delhi with the non-stop overnight flight from Lufthansa at 8.30 pm. My EO-chapter Bangalore has organized its annual retreat in the beautiful North Indian city of Udaipur in the State of Rajasthan and I really would have had a hard time missing out on that.

Hope to bring back some nice pictures. Will return on Tuesday morning to Munich and have scheduled already a business lunch for that day – on the Wies'n of course – LOL

Have a great weekend. 

Hilarious Video from Belgian Talkshow

That's one of these videos that you are not supposed to laugh about. Because the subject is politically incorrect and such links get sent around "under the hand". I got it from a friend, a high-level media executive in Germany (undisclosed ;-). And in fact the language of this talkshow is in Flemish (I guess), which I don't know, but which at the same time doesn't matter to get the story.

But if you look closer at the situation, it's neither about ridiculing the people concerned, neither the poor moderator putting himself above them (which is indeed very bad manners), but it's just an involuntary relief of a enormously bizarre situation. Where there is this gram of humor in a tragic situation that can magnify to a burst of laughter. Quite human, as I find. Have a great weekend.

For some reasons, I am unable to embed the video, hence here is the link on YouTube to it. 

Insider Information of India’s Travel Industry

Leaving the heavy monsoon of Bangalore behind me, I just arrived in Munich where I am happily looking forward to a dense and exciting weekdend. Saturday 12.00 pm start of the famous Munich Oktoberfest, in the afternoon marriage of a good friend of mine and Sunday lunch (again on the Oktoberfest :-) with Robert Wuttke, founder and CEO of the international online match-making service Be2 .

Yesterday I bought my ticket for Bangalore-Maldives-Bangalore in mid November with a new travel agent after firing my old one due to repeated indolence and non-responsiveness (see also my post from Tuesday). The new one is doing a lot of corporate travel and seems to be an insider in the industry for 17 years where he shared some interesting insights with me which I just repeat at this place without having double-checked them: My regular "shuttle" Frankfurt-Bangalore-Frankfurt seems to be the most profitable for Lufthansa in its entire network, displacing so far Frankfurt-San Francisco-Frankfurt.

I told him about my annoyance that it was for approximately one year no longer possible to book on the e.g. excellent website of JetAirways with a non-Indian credit card for a domestic flight. He confirmed that the rules have been changed after for instance JetAirways has allegedly lost around € 15 Mio. on fraudulent bookings. The agent told me that he and his agency were daily targets of purchase requests for 100 tickets mostly from obscure African prospects which would be settled by credit card. He rejects them all, especially as the credit card companies issue warnings on a regular bases to do so. Even more so as the risk has been shifted to the vendor: In case the credit card turns out to be a fraud, the seller has to return the money but has sold the service.

The latter seems quite in tune with an article that I read about a real mafia which has built up worldwide and which collects and sells forfeited credit cards in bulk. I also realized the same that increasingly when I travel and have some expense with my credit card, my bank would call me on my mobile within half an hour to verify if it was really me. So far, knock on wood, consistently: yes.

India’s Future: The White, the Black and the Shades of Grey

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Yesterday, I had an interesting dinner with Sebastian Matthes, editor of the "Wirtschaftswoche"-magazine, something like the German equivalent of the Newsweek. It was rather a background conversation where it dawned on me how different opinions about India's future you get to hear depending on whom you ask. Disclaimer: I am very aware that these three following viewpoints are not remotely sufficient to portray this both huge and complex country. But nevertheless:

  • Macro-Views: Reading the Economist, there is optimism mixed with scepticism where India was not overheating as this or this article points out. In absolute terms nobody questions that India has brought a lot of people out of poverty and will continue to do so. Let's see on which pace it's going to happen.
  • MNC (Multi National Company)-View: Talking to a CEO of an MNC will overall be on the positive side. He will tell you that e.g. in IT it is no longer just labour arbitrage which keeps them committed, but the mere lack of people in their motherland to cater for the growing HR-demand. He will complain about rising labour-cost and attrition, but point out that the Indian subsidiary has contributed enormously in transforming his company into a true global player.
  • Expat on a team-lead level: He will usually have the most negative outlook. And I understand exactly why this is so. In contrast to his MNC-Expat-CEO he will not have the KPI-dashboard in front of him, his unquestionably smart Indian board of directors and perceive that by the figures, things are going well. The expat team-lead will have to put a lot of energy into rolling-up his sleeves every day and get his shocks also every day. Especially as he will compare productivity and outcome on the individual level to what he is used to back in his western homeland. In India, and it's like that, he will be confronted on a constant bases with an unbelievable amount of idiocy, unreliability and lack of accountability. This will usually make him cynical and turn his entire view on the country pretty sour.

My own views are oscillating equally between those various perspectives, depending on what a day I have here. At the end these mixed experiences might even defy the concept of "what is truth". But what I know for sure: "Mother India" doesn't care about that and will just keep going.

Airplane-Crash in Phuket

Yesterday the news broke about the crash of a MD-88 plane during landing at Phuket Airport (Thailand) in very bad weather. Since I have a pilot license myself (for smaller planes, though) each of these incidents sends me a little shiver down the spine. Not that was am scared of flying, but such incidents show us the limitations of both technology and what in aviation is called "the human factor". Especially when I feel a very special kind of responsibility in those flights where I take passengers on board. So far always everything went very smooth.

What I realize after such a crash when there are first fragments of information available, the the analysis starts gnawing on my mind. When it said yesterday that the pilot tried a go around I started to ask. Why did it fail? Was the pitch too high and the plane simply stalled. Did a wind-sheer get under one wing and turned the bank such that the other hit the runway? Did the engines fail to produce full thrust to initiate the safe climb?

From the latest information today, the plane had already one go-around. So it was on its second final approch, had a touch-down on the runway, started to climb again before crashing on the runway, breaking into two pieces and slipping off. The investigation is in full swing and will watch closely.

Today, however, our thoughts should be with those 88 who lost their lives and their families. 

Psychology of Poverty-Perception

I found this article in Wired very intriguing which explains from a scientific standpoint how humans tick when they are confronted with people who need their help. Especially, as I fully correlates with my own experience since I have been living in India. Quoting from the work of Paul Slovic who runs the social-science think tank Decision Research, it points to a remarkable trait in human behavior when confronted with poverty:

In one recent experiment, Slovic presented subjects with a picture of "Rokia," a starving child in Mali, and asked them how much they'd be willing to give to help feed her. Then he showed a different group photos of two Malinese children — "Rokia and Moussa." The group presented with two kids gave 15 percent less than those shown just one child. In a related experiment, people were asked to donate money to help a dying child. When a second set of subjects was asked to donate to a group of eight children dying of the same cause, the average donation was 50 percent lower.

India is obviously full of poverty, although it it a commonly accepted fact that in spite of all hardships people do no longer starve. On the other hand, 80 % of the population living on less that US-$ 2 per day is a strong indicator of not really a wealthy country overall. Where do I want to go with that? Yes, there is poverty, and it emerges most prominently in the big metros like Bombay or Bangalore when you drive past slums. Or with immediate impact when beggars, usually very aggressive ones, assault you for giving money to them. How to react? What is a morally acceptable way of treating the situation? Do I have an obligation, because I am "rich" (relatively) and they are poor? And there, the experiment kicks in and the same type of shift as well: I remember when I was a small boy and my Mum walked me through Munich and a beggar would sit somewhere in front of a church. My mother would explain to me that this was a "armer Mann" (=poor man) who needed our help and would put some coins into his hat. This kind of mindset has been very much formative for my framework of social behavior. Certainly, out of the fact that these beggars were relatively rare, quite in line with the the picture of "one child" above, and seemed truly in despair.

Contrast that to India where the occurrence of beggars is ubiquitous and in their aggressive ways with following you and touching you heavily annoying. Once you also learn that many of them are organized in rackets, driven by market economics where they fight for lucrative "property" (i.e. well frequented crossroads), your pity and helpfulness plummets down to nil. Is that morally objectionable? I don't think so. Although the experiment above is per se descriptional, therefore only able to explain behavior, it leaves a blank when it comes to a normative take on the situation. My own thoughts on this: I still feel as a guest and visitor in India. I try my best to play by the rules of this country, I have invested in this country and I do add value to the economy by my consumption. Yet, my love for India does not go that far that I feel responsible for the social situation, especially when it comes to alleviating it with the wrong means. And these are certainly: giving money to beggars. Till recently, when I used to go through my moral dilemmas, I was happy to read from Mohammes Yunus who won the Nobel Prize for his successful foundation of Bangladesh's Grameen Bank. This institute provided mirco-credits to the poor, an investment which has brought thousands of people out of poverty in a sustainable way and truly restored their human dignity. And the same Mohammed Yunus said in an interview, paraphrazed: "As hard as it may appear, I never give money to beggars in the street."

In that respect, the initial article from Wired is pretty right to demand that  more "social cripples" like Bill Gates enter the field of philantrophy. For them 3 starving children analytically is 3 times the suffering, and 100.000 poor people a 100.000 magnification of a problem they can tackle not just with their money, but with smart and "getting-things-done"-concepts which allow for a lasting change. Overall, if one really wants to help, it's more about giving money (to the right organizations), giving time (for fruitful initatives) and giving contact (from your network of people who can enable something). So far the latter as a rough quotation from Bill Clinton's new book "Giving " which I held in my hands a few days ago in a bookstore in Bangalore.

“Hello World”: New Blog or The Power of Open Source

Anybody noticed anything? :-) Although it looks just like a polishing of the surface, there was much more work to it. Without showing-off, the effort was quite what I thought it would be: significant. In brief: Migration of existing content from Movable Type to WordPress, change of infrastructural environment to another hoster and the obvious graphical redesign.

As I became increasingly frustrated with the instability of my old system which I thought would crash every day, the change became a necessity not just a nerdy passion. Especially, as I got used to the neat back-end from WordPress through the blogging that I do for Holzbrinck eLAB. No wonder that the Open Source solution from WordPress by now is the most favorite software for bloggers who want to run the publishing in their own environment. Unlike using the convenient, yet hosted Blogger.com which for my requirements does not bring all the degrees of freedom. Also, I decided to switch the time code which displays when a blog was posted to GMT (Greenwich Mean Time) , more or less the same as Universal Time Code (UTC), in aviation simply called Zulu-Time .  

For the technical nitty-gritty, there was quite a bit involved: Making sure that the old URLs are preserved, making sure that the old RSS-feed would not get discontinued etc. And it was a real flat-world project where I'd like to thank Rado and Mirko from Mineus in Prague (Czech Republic) for the technical expertise and putting up with my fuddy-duddy requests, Fred from Agentur 2 in Munich (Germany) for the graphical design. Myself in the middle as a coordinator mostly from Bangalore, I don't have to thank at this point ;-)

Hope you sort of like it. Let me know.

The flatter World

Since yesterday being back in Bangalore, the “capital of globalization”, a few inspirational thoughts on what has changed in the last 2 years since Thomas Friedman coined the term of a “Flat World“. Let’s start with the simple statement: The speed of change has remained the same. However, the absolute delta of that change are bigger than anything we would have imagined in our lifetimes. With “we” I allowed myself to bluntly simplify people like me and my peer group who are in their mid 30s, born and brought up in Europe, reasonably well educated, relatively independent. And here the drama starts: This type of “we” is an endangered species, extinction not directly imminent, but in relative terms clearly in decline – as this graphic of the world population puts forward (courtesy to Rohit Talwar).

world_population

In the light of this huge demographic macro-trend it is no wonder that successful companies have left the shores of their homelands to set up shop elsewhere, in particular Asia. This is so far nothing new. What stunned me however, was an article in the German Spiegel about SAP, a software company. Although SAP has been a pioneer early on in India, by now the underlying paradigms have started to shift. Previously, it was clear that SAP’s headquarter in a small and boring German town called “Walldorf” was the centre of the universe. This is about to blur, not without the dismay of the German employees. Previously, India was the cost-effective programming bench delivering to Walldorf, by now some German staff has to report to the Bangalore. Here, the Indian entity has taken the lead at the front-end design for the new A1S, a system targeted at small- and mid-size companies.

By the same token, the great and respected Indian companies are by far no longer purely Indian. How else could we put today’s news into proper context, that Wipro has decided to hire 100 people in Mexico. Thus, the really global players no longer flow towards the force of labor arbitrage, but are clearly about to establish a global “value network”.

Overall, the transformational impact on the world order coming due to Asia’s rise must not be underestimated. Besides the pure demographics, where the Spiegel article rightly points out that the likelihood of finding strong talent is higher just based on the sheer number of people, also the economic growth will re-allocate the gravitational centres: In 15 years China will produce the world’s biggest GDP (normalized for Purchase Power Parity (PPP)), in another 30 years the same will hold true in absolute terms.

The biggest challenge in these hyper-dynamic economies is and will be talent, as “The Economist” recently pointed out.

Technical skills, particularly in information technology, are lacking in many parts of the region, even India. One of the main concerns is that there are not enough skilled graduates to fill all the jobs being created in a vibrant sector. Nasscom, which represents India’s software companies, has estimated that there could be a shortfall of 500,000 IT professionals by 2010. This means companies recruiting at job fairs in India are having to make lucrative offers to capture the most promising students.

Indeed, from my own professional experience in India, the top IT-firms are nowadays accepting candidates whose resumé would have landed in the trash-bin two years ago. The hook: These freshers undergo a 12-months training internally before they can be put on the job, get productive and especially get billed. Until then, they add significantly to the cost base of the company. I would call this the broadening on the “bottom of the pyramid” to keep these companies doing what they need to do: scale, scale and scale. On top of the pyramid, in a kind of radical top-down cascading of skills, the air is becoming increasingly thinner, as the the same article continues to explain:

Pay rates for senior staff in many parts of Asia already exceed those for similar staff in much of Europe. The going rate for a human-resources director working for a medium-to-large multinational in Shanghai is now $250,000 a year, and that is for “someone who has probably never even left China,” says Vanessa Moriel, the managing partner of Human Capital Partners, a Shanghai-based consulting firm. The chief executive of an international business based in India can expect to earn $400,000-500,000, with many earning well over $750,000, according to Korn/Ferry, a consultancy.

The other cost of labor comes in a different shade: attrition. People leaving fast and even worse, unexpectedly, being gone and away usually a few days after resigning. For a a western manager, where comparable labor-markets possess rather negotiating power from the demand (=employers’)-side, such behavior can come by surprise. Thus, the necessity to create a tremendously robust HR-framework from the beginning is of fundamental essence: sifting through tens of thousand of applications, coming up with the right retention plan, considering 20 % attrition per year as good and hedging against knowledge-loss via systemic processes.

Asia is booming, everbody wants a piece of the pie. Yet, who wants to succeed must truly adopt HSBC’s slogan: “Never underestimate the Power of local Knowledge.”

Outsourcing to India: Simpson’sTake on it

The humour of “The Simpsons” is anyway hard to beat. Just came back to “Mother India” last night, where I am happily enjoying the hot temperatures as a nice contrast to Germany’s 7 degrees, clouds and rain. A friend passed along this video to me. It’s hilarious, 7 minutes, and it plays with so many clichées about India and the U.S. surrounding outsourcing in a very funny way.