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Got pigs in your team?

In project management the analogy of pig, chicken and roosters are used to drive home of the point regarding the commitment levels. To make hamburgers, the pig is committed(meaning they need to lose their life; In other words, Pigs skin is in the game). The chicken is involved(Meaning they can simply lay eggs and move on with their normal life). Roosters are considered unproductive and not-useful to be around.

Think pigs as your core team members; Chickens as your non-core members but useful and productive; Roosters as your team members who are GFN(Good for nothing). It’s important you have the right proportion of the pigs and chicken in your team so that you can deliver the hamburger(i.e. IT services).

So, now do you have the mental map of your team? Tell me how many pigs and chickens you see?. BTW, I believe you must have got rid of those roosters long back.

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Sitting on cash pile

Indian IT service provides are sitting on a huge cash pile – billions of dollars worth. Infosys cash reserve stands around $3.8b, TCS reserve stands around $1.6b and Wipro cash stands around $1.3b.

While the liquidity is a good thing to support the working capital need, as a contingency and as a cushion to wade through rough patches of the business cycle, too much unused liquidity is unproductive. Equity share holders do not invest in the company to keep the cash in money market instruments and bank deposits on long term basis. Equity stakeholders expect the company to efficiently use the cash so as to enhance the ROE/ROCE. If the company can’t use the cash efficiently, it is prudent to return the cash to investors as dividends.

Does the large cash pile reflect risk averse attitude of the Indian IT service providers? Or does it represent lack of innovation DNA? My take is it is a combination of both. Why can’t the cash be productively deployed for R&D and new product/solutions development?

Most of the Indian IT vendors prefer “string of pearls” approach and have acquired smaller companies in the last few years. Big acquisitions and big bang M&A are a no-no (expect for one or two rare instances like iGate acquiring Patni).

Long years have passed by with little action in this front by Indian IT companies. The window is closing – fast. I hope this wouldn’t turn into mere pipedream. I wish some increased traction happens in this front within a year or two.

Cloud is bulls**t

You may find the perspective from Vineet Nayar, CEO, HCL Technologies interesting and different from hundreds of other cloud-glorifying interviews:

Cloud is bulls**t

Goodbye 2009!

2009 has been very hard year for the Indian IT industry as a whole and I had my own share of hard times to go through this year. Hard times teach lessons. Only test of fire makes fine steel. I have taken cues as well and planning to implement them in the next year. Goodbye 2009! Welcome 2010!!

Wishing you happy New Year and holidays. I will meet you in 2010 with new thoughts.


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