Another story from India
Bangalore is a vibrant city with hundreds of foreign technology companies, including top U.S. companies such as Microsoft, Google, IBM, Cisco, General Electric, Motorola, Hewlett Packard and Intel. There is also a similar atmosphere of Silicon Valley, California with expensive new restaurants, congested traffic, high priced housing. Most hotels, restaurants and nightclubs are fully packed with technology workers and customers from all over the world. Although India has changed into a wealthy nation but the gap between the rich and the poor is still visible: Next to expensive restaurants and nightclubs where technology workers spend lavishly on foods and wines are garbage dumbs where poor people live off discarded junks. There are expensive mansions with latest model cars situated not far away from slums, where thousand people live in shacks made from cardboard boxes.
Infosys's Bangalore headquarter buildings look similar to any U.S high tech companies with beautiful landscaping, modern cafeterias, athletic facilities and other amenities. You can see many young technology workers in fashionable clothes checking their text messages on the latest smartphones. My friend Ajit explains: “Infosys is the first Indian company to grant its workers stock options that make many become millionaires. It sets the trend in India that technology can make you rich. When young people see people at their age can buy expensive cars, live in big mansions, they rush in to study technology. You do not need to convince them that science and technology are the best fields to study in college because they all see what happened to graduates from these fields. There are so many technology jobs available here in Bangalore and many workers are relatively wealthy. You can see many late-model cars around the city, something unimaginable a few years ago. Many young technology workers are buying expensive houses, something their parents who work all their lives could not even dream of buying them.”
There were many important guests who visited Infosys, the symbol of how India has successful become a technology country. As part of the local culture, many have planted trees on the grounds. My friend Ajit points to a tree: “That tree is planted by Bill Gates in 2002 when he visited Infosys. Over there is a tree placed by British Prime Minister Tony Blair and next to it is a tree planted by Michael Dell, the CEO of Dell computing company.” The Infosys cafeterias are very modern with all types of foods, Ajit explains: “Our company is expanding globally; we open software centers in China, Japan, Western Europe, and the U.S. and bring many workers here for training. You can see people from Germany, U.K, Japanese and Korean here and that is why we have to provide special types of foods.”
Infosys develops all types of software for customers all over the world but their key customers are U.S. companies. There is a list of thousands U.S. companies among their customers. Infosys pays its software engineers average $800 dollars a month in Bangalore, less than what comparable U.S. jobs pay but it is impressive in India because the average Indian lives on $570 a year. Infosys is an example of how in just 20 years, this poor agriculture country can grow into a technology giant that has become the envy of most countries in the developing world. Today it also creates a concern among developed countries that India could compete in the technology market and take their business away. My friend Ajit explains: “There is a movement against outsourcing in many countries. Some big companies do not want further controversy, so they stop outsource. But we open our development centers in their countries and hire their people so we become part of their country and the business continues. We are now a global company with many software centers all over the world and we are expanding fast.”
I ask: “But in that case, cost is no longer advantage because you have to pay higher prices.” Ajit explains: “It is true but today with the shortage of IT skills, cost is no longer the key factor but skills are. We have the most up to date trainings to our workers. Many companies are willing to pay top salary for the skills that they need. With globalization, many things change, everybody is looking for the best products and services regardless of costs. People are willing to pay for an expensive iPhone rather than a cheaper smartphone. Customers are demanding the latest skills so we have to adjust quickly. Since education is slow to change in every country, we take the advantages by train our workers with the latest skills. The new rule is no longer cost but high demand skills. If you look at our success, you can see that if we maintain low costs, we cannot compete with other South East Asian and African countries that have lower costs but they do not have the high demand skills. Workers in those countries can code and test but they cannot do what our workers can. That is why our investment in education is the key advantage.”
Ajit concludes: “India is moving fast toward a very bright future. Our middle class has tripled from 100 million to about 300 million in the past 15 years. These people live here, buy things here, and contribute to our economy. The world market for technology is exploding and India is ready to take advantage of that. All due to a vision set in 1947 by Mahatma Gandhi: “Invest in our own people by giving them the best education and they will make this country the most powerful nation on earth.”
- Blogs of Prof. John Vu, Carnegie Mellon University