The Unattainable Real-Time Enterprise

Roland Tanglaos points to a Geoffrey Moore column (part of his "Under the Buzz" newsletter):

The Real-Time Enterprise is a goal that we continually move closer to without ever achieving. In every generation, new technology comes forward and spawns innovative ways of doing business. Common threads are the expanding domain of automation and increased outsourcing. As companies become more efficient and more focused on creating value, the gap between what we can imagine our businesses can do and what they can actually do becomes smaller.

Of course, our imaginations are more powerful than our ability to execute. There will always be a gap. The full blown real-time enterprise will stay just out of our reach. But it is important to note that today, because of the massive proliferation of technology the nature of the gap has changed. In the past, issues of cost and latency constrained the approximation of the real-time goal. We could not afford a real-time enterprise, nor could we move fast enough to achieve it. We did not have ready made technology available to solve the next set of problems in the way. When companies did solve the problems, they did so buy building the needed technology. Today, technological constraints are less of a problem. We are awash in computing power in every corner of the corporation. Technologies such as wireless and broadband connect a mature suite of tools and enterprise applications. We have huge computing platforms and massive storage capabilities. It is more technology than we can really absorb. Now, the barrier to the real-time enterprise is understanding how to put all of this power use to its fullest capabilities. We need to make each of the modules more articulate and more vertical; that is, more tailored to problems in a particular industry. The architecture works end-to-end, but how much of that architecture is actually assisting our processes all along? How far can we actually get the right architecture out of our imaginations and into reality? So the Real-Time Enterprise is about getting real – taking thoughts and visions, and making them real. It is about realizing the capabilities we already possess in current technology. In theory, the Real-Time Enterprise already exists, but in practice we are not there yet. Getting closer to the vision, closing the gap, this is the challenge going forward.

Google as Platform

Jason Kottke adds to Skrenta's post:

They have this huge map of the Web and are aware of how people move around in the virtual space it represents. They have the perfect place to store this map (one of the world's largest computers that's all but incapable of crashing). And they are clever at reading this map. Google knows what people write about, what they search for, what they shop for, they know who wants to advertise and how effective those advertisements are, and they're about to know how we communicate with friends and loved ones. What can they do with all that? Just about anything that collection of Ph.Ds can dream up.

Tim O'Reilly has talked about various bits from the Web morphing into "the emergent Internet operating system"; the small pieces loosely joining, if you will. Google seems to be heading there already, all by themselves. By building and then joining a bunch of the small pieces by themselves, Google can take full advantage of the economies of scale and avoid the difficulties of interop.

Google isn't worried about Yahoo! or Microsoft's search efforts...although the media's focus on that is probably to their advantage. Their real target is Windows. Who needs Windows when anyone can have free unlimited access to the world's fastest computer running the smartest operating system? Mobile devices don't need big, bloated OSes...they'll be perfect platforms for accessing the GooOS. Using Gnome and Linux as a starting point, Google should design an OS for desktop computers that's modified to use the GooOS and sell it right alongside Windows ($200) at CompUSA for $10/apiece (available free online of course). Google Office (Goffice?) will be built in, with all your data stored locally, backed up remotely, and available to whomever it needs to be (SubEthaEdit-style collaboration on Word/Excel/PowerPoint-esque documents is only the beginning). Email, shopping, games, music, news, personal publishing, etc.; all the stuff that people use their computers for, it's all there.

Even though everyone's down on Google these days, they remain the most interesting company in the world and I'm optimistic about their potential and success (while also apprehensive about the prospect of using Google for absolutely everything someday...I'll be cursing the Google monopoly in 5 years time). If they stay on target with their plans to leverage their three core assets (which, if Gmail is any indication, they will), I predict Google will be the biggest and most important company in the world in 5-8 years.

Danny Sullivan chimes in with his thoughts on the "Google Desktop":

Will Google's new free e-mail system, Gmail, be just the first of many things we'll see in a new Google Desktop? If so, Microsoft could have a lot more to worry about than just Web search.

Today, plenty of people download mail to desktop-based e-mail programs. But Google might convince some of them to take up its e-mail storage offer.

After all, even if you do have a great way to search through desktop-based e-mail, you might like the idea that all your mail is backed up, stored offsite, and easily searchable from anywhere.

Now, take things a step further. Imagine next year Google provides users with 5, 10, or more gigabytes storage space for personal files.

Got a ton of text documents, spreadsheets, and other material? Push it to us, Google would say. We'll store it, index it, and make it easy to retrieve what you want. Google already indexes this type of material across the Web and has done so for ages.

As broadband expands, such an idea becomes increasingly more feasible. With it, the notion that Microsoft might trump Google with desktop lock-in becomes less of an issue.

There is an interesting opportunity for Indian broadband companies - think like Google on the platform side, and combine with thin clients (akin to handsets) for users to build an end-to-end alternate computing platform the the mass market (today's non-users) in India. There are 40 million home users waiting.

IBM buys Daksh

The Indian BPO space is now being truly globalised. IBM has bought Daksh, one of India's largest call-centre companies for an estimated price of between Rs 650-800 crore (USD 140-175 million). Daksh's revenues were about USD 60 million, and employs over 6,000 people. Adds WSJ:

Founded in 2000, closely held Daksh was one of the first independent companies to cash in on India's abundance of young, English-speaking workers. During the past four years, three investment firms -- CDC Capital Partners of Britain, a private-equity arm of Citigroup Inc. and General Atlantic Partners of the U.S. -- together have invested $29 million in Daksh. They should profit significantly from IBM's acquisition.

IBM's purchase of Daksh could spark further consolidation in India's call-center and back-office business, valued at $3.5 billion in annual revenue. Some companies are looking to be acquired; others are considering public offerings. The industry encompasses services including typical call-center work answering customer queries and more complex areas such as payroll processing and accounting.

A spokesman said IBM expects to expand Daksh's business with existing international customers and inside the fast-growing Indian market. IBM plans to boost Daksh's back-office services, such as handling financial transactions and handling supply-chain functions, rather than its basic call-center operations.

Om Malik goes to India

I had met Om recently in San Francisco. Om and I had interacted many years ago when he was doing a story on IndiaWorld. This was my first meeting with him. We had a great conversation about "commPuting" and my "massPuter" ideas [he coined both the phrases]. Om, now with Business2.0, is now in India after eight years, and blogging about his impressions.

Some interesting posts on:
- why it is end game for Nokia
- India's wireless lufestyles
- India's cricket obsession

Am lokking forward to meeting with Om again next week.

Indian Pharma Success Story

Forbes writes: "India makes great knockoff drugs. Now one company is originating its own--squaring off against US giants."

Protected by the country's patent law, which recognizes processes but not products, most Indian pharmaceutical companies have been content to remain copycats--and small ones, at that. That cozy world is about to be shattered: Next year new laws will prohibit the cloning of medicines patented after 1995. That will restrict Indian companies from flooding the domestic market with generic fabrications and force them to invest in producing their own homegrown drugs.

Ranbaxy is better prepared than most rivals. It was an early investor in R&D, and its experience of selling to Western markets gives it an additional leg up. The company has 81 generic products approved by the U.S. Food & Drug Administration and 40 pending approval, including 22 challenges of patented drugs (among them: one for Pfizer's cholesterol-battering blockbuster, Lipitor). Recently a U.S. federal court upheld Ranbaxy's patent challenge against GlaxoSmithKline's Augmentin, a product that augments the unpatented antibiotic amoxicillin with a chemical that attacks a bacterial defense against antibiotics. According to a Credit Lyonnais Securities estimate, Ranbaxy's U.S. sales of the generic version of this combo pill approached $66 million last year.

Such windfalls are funding Ranbaxy's big gamble: basic drug research. "If you're poor and try to be conservative, then you can only conserve your poverty," says Rashmi Barbhaiya, head of research at Ranbaxy Laboratories in New Delhi.

We need Indian software companies which can do something similar.

Bus. Std: It’s time to wave India’s digital hand

My latest column in Business Standard:

Bookshops are temples for the mind. When I travel, I make it a point to visit the best bookstores that the city has to offer. Even in the Internet world, there is no greater pleasure than to serendipitiously find a book – that answers many questions that the mind has been pondering on.

It was in one such temple in San Francisco that I came across a book entitled “The Digital Hand: How Computers Changed the Work of American Manufacturing, Transportation, and Retail Industries.” At that time, I was thinking about how to modernise India rapidly – could we possibly learn from what the developed countries like the US have gone through, and accelerate the process in India.

The title of the book immediately appealed to me. Early, rapid and near-universal adoption of computers have long been one of the reasons for the technological lead of the US. So, to come across a book which traced the history of diffusion of one of the most important inventions of all-time was like discovering a hidden treasure.

The author, James Cortada, worked at IBM for three decades and had a ringside view of the computerisation of US industry. In the book, he focuses on how computing transformed the American economy in the second half of the last century.

The Digital Hand is a reference to Adam Smith's “invisible hand” - the self-interest that guides the most efficient use of resources in a nation's economy, with public welfare coming as a by-product. The computers is the modern-day digital equivalent – an all-pervasive force that drives efficiencies in economies.

Why look at the past in a field that changes rapidly as information technology? Writes Cortada: “Understanding historic patterns of adoption of digital technology gives us insight into how specific industries did, and continue to, operate because they are prisoners of existing applications and processes and, in most instances, of long-standing practices and attitudes.” In other words, a study of the past can help us unravel the future.

This can be especially important in the Indian context as we seek to build our digital infrastructure. What the US did over fifty years, India needs to do in five. Every industry in India needs to absorb technology and rethink its processes if India has to accelerate on the fast-track of development.

The US corporations adopted new inventions sequentially – mainframe, mini and personal computers, networks, wireless technologies and most recently, broadband networks. The American workers had time to adjust to each phase of technological innovation. Also, different industries computerised at different points of time.

In contrast, Indian industry has to focus on all-round and simultaneous adoption of new technologies in computing and communications. In the past, it has, by and large, been slow to deploy the new technologies – hobbled in part by the high cost of technology and low cost of labour. This needs to change if India has to develop. India's industrial units have to become globally competitive, so they can achieve the scale to produce cost-effectively for the domestic market. What we have to think is how, in the context of these digital innovations, can we live and work differently. India has the opportunity to leapfrog.

Consider radio frequency identification (RFID). RFID systems consist of smart tags and reader devices. The tags send out radio frequency signals, which can be picked up in a short range by readers. Unlike bar codes which can carry very limited information, smart tags can store and broadcast object-specific information, giving each item its own unique identify and history.

Think of RFIDs as the next wave in communications: we first had people talking to people (through language and publications), then we had people interacting with computers (through the Internet, HTML and HTTP), now we are seeing applications talk to other applications (through Web Services). The next leap will be objects talking to other objects.

RFID is just starting to get adopted in the US. Wal-mart has mandated its suppliers to use RFID by the end of this year. Imagine if Indian retail chains and stores do the same in India. This will have multiple implications: it will position Indian manufacturers as “Wal-mart ready”, it will make Indian supply chains efficient very quickly, and it will give the Indian software companies competing globally a domestic market to build their strengths in what is a rapidly emerging area.

The equivalent of RFID can be found across industries. Whether it is WiFi or WiMax wireless broadband networks, open-source software, mobility-aware applications or RSS-enabled content, new technologies abound in all sectors. India has the ability to lead and set the standards, rather than be a followed and a footnote on the pages of business and technology history books. The Indian economic miracle needs to move away from its dependency on the hand of God each monsoon. It's time to wave our Digital Hand.

TECH TALK: As India Develops: Energy (Part 4)

Vijay Vaitheeswaran is The Economists’s energy and environment correspondent. He has written a book “Power to the People: How the Coming Energy Revolution will transform an Industry, Change our Lives, and Maybe Even Save the Planet.” The book discusses the economic, political and technological forces shaping the world’s largest industry. The last chapter in the book is entitled “Micropower meets Village Power.” He writes:

In an age of unprecedented prosperity, it is outrageous that so many people should continue to live in such grinding poverty. Another, more selfish, reason for the rich world to care is that the energy needs of the world’s poor will – unless governments intervene – increasingly threaten oil resources, international trade, and global economic growth…While those lucky enough to live in rich countries benefit from all of the mobility, warmth, and economic productivity made possible by ready access to modern energy, much of the world still uses energy more or less as mankind did thousands of years ago.

Just because the indigent are energy-poor, however, does not mean they use no energy: life would be impossible without it. What it does mean is that they use mostly noncommercial fuels, such as charcoal, crop residues, and co dung, usually in ways that are harmful to both human health and the environment…Such inferior fuels make up a whopping 25 percent of the world’s overall energy consumption and 75 percent of all energy used by households in developing countries.

Electricity can have a dramatic impact on education and literacy, for children can study at night after that have completed their chores. Raj Pachauri of the Tata Energy Research Institute (TERI) sums it up this way: “If the world is to have any hope of lifting the yoke of absolute poverty, it must provide rural villages and urban slums with far greater access to electricity and modern fuels.”

While the very poorest will always need subsidies, that does not mean that there is ability to pay for energy among the world’s poor. Of the people without access to energy among the world’s poor, the World Bank estimates that half do have the ability to pay commercial rates for electricity…The crucial – but often overlooked – point is that there is ample evidence that the poor already do pay, often heavily, for energy services that the state fails to deliver. The amount of money spent by those dirt-poor households on inefficient, dirty ways of delivery energy – such as kerosene, candle wax, and rechargeable batteries – can be greater than what is spent by middle-class households or wealthy farmers on heavily subsidized grid electricity.

TERI’s Pachauri thinks that helping local entrepreneurs with incentives to maintain and expand the micropower infrastructure is the key…And how fitting it would be if the fuel of choice were to be the lightest element of them all – hydrogen.

Along with access to food, clean water and education, a continuous and reliable source of energy is what rural (and many urban) Indians need most. In India, “power to the people” still only means giving them the right to vote once every few years. Hopefully, by leveraging some of the new technological developments in the world of energy, we can genuinely make India a full-power country in the near future.

Tomorrow: Distribution Hubs

Related Entries:  [All]
TECH TALK: As India Develops: A Personal View [April 23, 2004]
TECH TALK: As India Develops: Innovation and Entrepreneurship [April 22, 2004]
TECH TALK: As India Develops: Vision and Will [April 21, 2004]
TECH TALK: As India Develops: Putting It Together [April 20, 2004]
TECH TALK: As India Develops: Distribution Hubs (Part 7) [April 19, 2004]