The Next Big Thing

Half an decade back Smartphones and Tablets were the next big thing. Everyone – from banks to studios to service providers to consumer electronics folks wanted to reserve a seat in that bandwagon. When I look back now, yes Smartphone is a big concept that changed the way we were living and it touched a billion people’s life. Seems there more life left in that concept and now the same thread is being extended as Internet-of-Things and a lot more folks have joined the bandwagon.

But things were different for several electronic hardware manufacturers. Smartphones and tablets turned around the market and created a few power centres. More and more devices, even medical instruments were made irrelevant by smartphones. Then folks tried to embed a tablet into each and everything possible (not literally but tried to embed the functionalities and capabilities of a tablet so that same underlying chipset can be used) – technology of portable personal devices to immobile devices at home like Televisions and Audio Systems. Though there is a competition between the devices in the living room on who will become the centrepiece one with smart functions, its not yet clear how much smart they have to become with a tablet/smartphone anyways around.

Automotive industry which traditionally is a lagger on adapting such technologies is now also on the move. At the low end of the spectrum, people who got used to better infotainment experience with smartphone are forcing automobile manufactures to at lest embed a tablet into the front panel. At the other end, need for making vehicles more and more autonomous or at lest assist the driver is driving both innovation and adoption of technology from other sectors. Is the next big technological innovation (in the likes of stream engine, factories, oil, internet & smartphones) going to happen in automobiles or some other form of personal transportation? may be, but unlikely to happen now. Is automobiles the next big market for electronic hardware manufactures after smartphone? again, no.

Because of regulation and market demand, amount of electronics that go into each car is increasing. But number of cars that gets produced globally every year still hovers in 8 digit number. Assuming need for high end electronics in an average automobile is 10 times that of a smartphone and 150 million automobiles get sold annually (say, after five years), that’s equivalent to catering to 1.5 billion smartphones. That number is close to number of smartphones and tables being shipped globally this year. And smartphone shipments are expected to grow at a much faster rate. So automotive industry cannot eclipse smartphone as the biggest market for electronics hardware manufacturers. And it definitely doesn’t have the characteristics to become next big engine powering the economy, let alone electronics.

To become an engine powering the economy, it has to touch the lives of most of the population; it should be a essential entity in their lives; there should be a continuous demand for it; it should be a significant entity in monetary terms; it should spawn allied entities & ecosystem; it should continue to evolve; lives of significant portion of the workforce should revolve around it. Look at the history of clothing, healthcare, capital goods/factories, transportation and weapons for how such engines evolve and mature. Lets compare housing, automobiles and smartphones on this front.

	Housing	Automobiles	Smartphone
Need	Basic and absolute necessity	Not a necessity in most of the geographies but a convenience need	A convenience and in some cases livelihood need
Monetary value	Several years/decades earning	Several months/years earning	Several weeks/months earning
Longevity	Close to a human being’s life expectancy	A decade	A few years
Count needed	1 per family	1 per family to 1 per person	1 per person
Future	Need will continue to exist	Might be needed	Needed till next technology obsoletes it

New life changing innovations are not predictable, but incremental engines of growths can be inferred. Based on the above information, my guess is next incremental engine for economic growth might be a smaller pervasive one that everyone can afford; that are used in volume and replaced at a relatively faster rate. I don’t know what that is, but sure we can’t go back to an older engine like automobiles and call it the next driver for growth.

Vendor vs Competitor

As part of Motorola Mobility, Google will get a huge number of mobile patents. When compared price quoted in the recent patent auction, 12 odd Billion dollars for MMI seems like a bargain. This deal might also help to reinvent GoogleTV. But Android now has to take a different course.

A few years back with PlaysForSure, MTP and WMP Microsoft managed to establish and support a reasonable ecosystem competing with iPod, iTunes and Apple store. All of that died when Microsoft launched Zune player. Zune itself didn’t adhere to anything that Microsoft advocated. Suddenly from being a reliable partner, Microsoft became a competitor in the eyes of media player manufacturers. Now there is no PlaysForSure and of course no credible competition to iPod.

Android changed the mobile phone arena completely. It lent reliability and brand name to not so trust worthy devices like Samsung mobiles. It helped Apple’s competitors to gang-up and compete as a united front. It helped to pitch feature against feature instead of one brand vs another or one device vs another.

Now with MMI under Google’s fold, will other mobile manufactures trust Google? Will Open Handset Alliance be still relevant? Will MMI get any additional advantage over others w.r.t Android? Google tried to address these concerns by saying that MMI will be a separate entity. But still, Google has to take care of these things for Android to survive. If not…

Samsung already is promoting Bada platform along with its app store. If it sees any foul play by MMI, it might shift its entire focus to Bada OS. Although questionable, Samsung might be able brush up Bada OS/store and make it reliable. Then that will demarcate clear battle lines.

Apple with its own OS

Motorola with Android

Nokia with Windows Phone

Samsung with Bada OS

Blackberry with QNX

Fringe players LG, Sony Ericsson, Asian mobile manufactures and new entrants will be facing the cross fire. Only exception will be HTC. HTC diversifies its platforms and tries to be everyone’s ally. Now will be forced to take a bet.

Next thing to watch is any developments from Samsung and HTC.

Measuring Value Creation

Yesterday we, the graduating batch of PGSEM had an informal closing ceremony. To pull each other’s leg, we created obscure awards like ‘Sleeping Beauty’, ‘Campus Casanova’. Voting for such awards happened real-time by sending SMS to a particular number/cellphone. An Android app running on that phone, received the messages and hosted the results via a web-interface. Voting results were available real-time and projected were on a big screen.

From an operational/engineering perspective, this was a grand success. The very concept of this kind of voting; technology used; design; everything going smoothly without any glitches.. perfect! From the event organizers’s perspective this was brilliant. What more could PGSEM guys done to spice up the event! This was a shot in the arm for PR guys trying to internally sell PGSEM.

But, did it serve its true purpose? Some of the awards were created to pull a particular person’s leg, but unexpected persons won most of the awards! This can easily be explained by or should have been anticipated before as, the event happens in a big auditorium; not everyone will come for the event and whoever comes, comes with their family. During an event in auditorium the level of interaction will generally be less, that too when you are with your family, it will even be worse. If the voting medium is voice vote or raising hands or physical paper, then the organizer pulls the information from the participants. But in case of SMS voting, the participants has to take the initiative to vote. Moreover sending SMS takes some effort and money.

When this whole sequence is viewed in terms of value creation, for operational reasons, PR and Engineering perspectives might influence the measurement process rather than the total value creation.

Even in my work-place, I have seen similar things. Some projects will be kicked-off just because it attracts high visibility and provides opportunities for the project team to show case their skills, well knowing that no one actually needs the project. Why does that happen? It is again because, the processes that we have fail to measure the total value creation but focus on short-term sexy things. 🙂

Social Network Analysis

It’s been a looong time since I posted in this blog. I think I have been posting articles meant for this blog on my other blogs. BTW, here is my journal submission for Social Network Analysis course @ IIMB. This is meant for submitting it to a Professor in an academic institution. Hence I might have exaggerated here and there. I also might have slightly deviated from what I wanted to say and sometimes written what I really don’t believe in 🙂

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Social Network Analysis – Hmm… looks like a cool topic. But what is it all about? I guess it is all about bridges, centrality, brokers, ego… sort of things in a city map and players dealing with it. Well, that’s what the Professor talked about (in my dreams? 😉 ) and it turns out that reality is not so different form it.

OK, I see networks; professional networks; family networks, personal networks and all sorts of networks in play everywhere. If I observe it from a distance, it looks like watching a perfectly harmonic opera in the Palais Garnier. Everyone around me is an actor playing their part skillfully. It looks like a mesh with active nodes morphing its overall shape from one to another like that of a magician’s cloth. Unlike a regular opera, actors don’t act according to their script. But they create their own script. Their decisions on whom to connect with at any moment decide the shape of the mesh at that moment.

This is social network in action. Analyzing its behavior helps us to understand why do people network and how do they network. Robin Dunbar has proposed that the size of a species’ brain is in proportion to its ability to handle size of its group. As humans disproportionately large brains, we can imagine the complexity of network behavior we have. Robert Winston in his book Human Instinct concludes that “We are born to live our lives in collaboration with others, and we are born with the ability to realize when others are failing to play their allotted role”. So it will be quite interesting to analyze our networking behavior. That will help us to understand why few people are very successful and why several others couldn’t imitate their behavior. It will help us to understand how inherently shy people have their own strong networks. It will help us to understand our social norms and better regulate work place ethics. It can even help us to understand about the nexus between power, politics, money and crime.

Wonderful, let me start with what academia has. Wow, it has tones and tones of information about social networking analysis. It is amazing to see that several paper have already been published in such a nascent filed like social network analysis. So many concepts! I couldn’t help nodding my head when I hear/read about several of them. But this scenario looks similar to Indian Private Equity space. Too many people are chasing too few companies instead of going a bit down and doing angel funding. I personally find it very hard to distinguish between the existing knowledge and what these papers trying to say. Most of them are just plain common sense. Hence I think there is lot more to uncover, theorize and discover in this field. It might be a quite promising field to work on!

Some academic researches focus on parameters and methodology of analysis. More or less they distinguish between different networks and types of networks. In a network, they identify the key players and the links between them. Then associate parameters to the players as well as the links between them. Based on these things define a concept, say Eigen vector centrality and see how does it influences the network and what role does it play in the network. You have to prove it; what other way than using numbers? Numbers means credibility. So create mathematical formulas to define and calculate the concept. Define metrics for the impact these concepts have on the networks and find the correlation.

Methodically analyzing one’s one network on those parameters will help us to tell where we stand. Our needs and wants tell us how our network should theoretically look like. Then we can reshape the existing network slowly to fit our needs. But practically this won’t work.

I see networking as an art rather than science. Line between art and science is rather a hazy one. Things that are now in one bucket may fall under the other bucket later. But under the current scenario I would like to consider ‘social network analysis’ as studying the ‘art of networking’. One can classify art; explain the characteristics of art; appreciate one’s art; study the art; but won’t be able to define boundaries to art and create a recipe for making art. The same holds true for social networks. Hence study of social networks will help us to inform us about various possibilities and options. It will guide us and validate our options. But it will never tell us what we should do and how should we our build networks. If someone promises to do it, please ignore him/her.

One big issue with analyzing a network is – how to get information about the network – how do get to know the ties between varies parties involved. If we couldn’t get this information, there is no point in spending years towards developing models and frameworks to analyze the network. This such a huge problem that it almost makes ‘social network analysis’ as a pure theoretical and academic domain.

One’s own network is very important to a person. It establishes his identity and defines his extended capabilities. A person is in a network because he brings some value to the network. He brings value not just by his own knowledge and intelligence but also because he can connect with persons from other networks and can bridge value exchange. If he exposes his true connections and strength of those connections, then makes himself vulnerable. Whoever has this information can make him redundant for the key persons whom he relies on. If that happens he will be kicked out of his networks. Hence everyone will keep information about their connections close to their heart and guard it closely. They will give you bits and pieces of information only on need basis.

It explains why different studies propose conflicting hypothesis. If one deals with partial information then the result will not be consistent. Actually many people will maintain a dual identity. No I am not talking about fellows working for Foreign missions of government and persons involved in intelligence gathering. It is a common practice to not make all your connections public but to intentionally expose a restricted subset or fictional list so that no one suspects your real connections.

There are a whole bunch of people working on a field called ‘competitive intelligence’. These people don’t (officially don’t) use illegal methods to gather information. But make painful efforts and go to great lengths to gather information. Almost all the big corporations employ them to gain knowledge about competitors, customers and vendors. Because of complex multilevel crossholdings, surrogate shareholdings and undisclosed relationships of directors, it will be quite difficult to identify who controls a company. Hence in case of Mergers and Acquisitions many companies use these researchers to analyze the counterparty. What these people do is exactly what is ‘social network analysis’. But they don’t most of the academic knowledge. The methodology they employ is different between individuals but they keep it as secret as the knowledge that they gather.

If you have read the book ‘Simply Fly’ by Caption Gopinath, then you might have seen the nexus of power, politics, money and their network. If you are an entrepreneur or associated with an entrepreneur, then you might know the importance of network. Network is everything for a startup. Survival of new venture and it subsequent growth is shaped by the entrepreneur’s network and his ability to create his/her own network around/in his organization. We see networks in action everywhere. It is like the invisible ‘ether’ but making visible impact to our day-to-day life.

If I am a born socializer then I know how to manage my network. But if I am not and like most of us, if I am a shy person then either I think persons using their networks are incapable persons or networks don’t play any significant role or I silently observe networks in from outside but unable to take any action. Will social network analysis be able to help such person develop the required skills to develop and maintain a network. That’s a million dollar question!

Unilever’s Media Planning

After a long time I am (over)watching TV from yesterday. Like most of us, I too enjoy watching advertisements than watching TV programs. WTH is happening now…

Seems like HUL has a new strategy for media planning  (compared to the good old days when I used to actively watch TV).

– All the ads in an entire break goes to HUL products!

– More than one ad for a product in the same theme are getting broadcast simultaneously but not immediately one after other

– There is a lot of reuse (dub!) of ads from other markets especially from Asia

– There is some reuse (remake!) of ads made for western audience

Instead of spending money on making the ads, is HUL spending money on purchasing media spots?

Is it an reflection of shakeup happened last year at HUL top management? For the past few years, HUL is trying to phase out local brands in favour of its international portfolio of brands. It succeeded in some cases and was forced to reintroduce and reposition the local brands in some cases. But reusing ads??? It is OK to position and promote a brand in simillar way in all the emerging markets (ex: Dove – real beauty). But same ads???

Earlier Indians never realized that the brands they use are international brands! I still remember getting shocked about this realization when I travelled out of India for the first time. (In fact it helped me to shop in Tokyo without understanding Japanese. 🙂 ) With the reuse of ads, this fact is projected more. Will Indians view it positively or negatively?

One can argue that projecting an International image will increase a brand’s value. This may probably due to the fact that (recent) historically we place foreign products above Indian products.

On the other hand, this also alienates the products from its consumer. Oh! the ‘my’ Lux is foreign product!

One can easily draw a parallel between this and regional movie industry. Probably due to the sheer number of movies produced, you can classify the regional movies (South Indian) movies into

1. Movies shot in other language and dubbed to local language

2. Movies originally shot in other language and then later remade in local language

3. Movies shot in multiple languages together or only in local language (don’t ask me where the storyline is flicked from)

In most of the cases probability of success of those movies are in reverse order. (oh! now I have to prove this hypothesis with alpha cut off of 5%?)

This can be attributed to the fact that, even if a product is good, if I see it not is made for me or worse hostile then I would rather settle for a good enough alternative.

Is HUL listening?

PS: I am interested in knowing about HUL’s media purchasing plan, any help?? BTW, which media house produced the Sunsilk’s ad with Priyanka Chopra?

Extended Family

Last week, when I saw ‘Buy 1 get 1 free’ offer on a big size Toilet Cleaner, I wondered who might take this offer! Are the marketers, applying standard promotional methods across their product line, without giving enough thought?

On 17th, Damodar Mal of Big Bazzar coincedentally touched upon the same example in his talk. Yes right, Marketers are no fools.

With respect to purchases, ‘Nuclear Family’ is a myth. In the mind, we still live with ‘Extended Families’. Haven’t we picked up some items for our neighbours/relatives/friends when we go for shopping? Haven’t we asked our neighbours/relatives/friends to pick up something for us on their shopping trip? There lies the answer to ‘Buy 1 get 1 free’ offer on a big size Toilet Cleaner!

JIT Inventories & Lead Time

Most of us know that Dell transformed the PC industry by successful Direct Selling. With Direct selling it is easier to adopt ‘JIT Inventories’. So you no longer have to estimate the demand for products/components/inventories and stock them. No need for ‘storage space’ for inventories; no need to lock up capital in inventories. In electronics industry, the value of the components fall drastically over time, with low turn around time for inventories, value of inventories doesn’t fall too much and ‘cost of goods’ will be less. So far so good…

One of the key requirement for this business model is, source of inventories/goods should be closer to its destination in terms of time. This will ensure lower lead time.  In US probably that’s the case. I think Dell forgot about ‘lead time’ in a few other geographies.

Subsidiary companies have to share the same vision and mission with their parent company. But not all the business practices need to be shared. Different geographies have different operating environment. One need to adapt his business practice according to the region he is operating in. In Dell’s case, shared mission should have been low lead time, not maintaining JIT inventories.

In India if I place the order for a PC component with Dell, Dell takes a lead time of 2-4 weeks! As they don’t maintain inventories locally, they have to ship it from China/Malaysia! In case of other manufacturers, new PCs lie in their/distributor’s/retailer’s godown for weeks. Instead Dell takes lead time. So I don’t mind this lead time for new PCs. For PC components, this lead time is irritating. My Laptop battery is down; it suddenly went down without any sign of degradation. Now I am forced to use it as a desktop PC for close to a month!

This is inspite of charging me Rs.4900 for a 6 cell battery! Yes sir, I am locked with Dell as I can buy it only from Dell. [Lithium Ion batteries are actually a commodity. But Dell and other PC manufacturers use different mechanical design to wrap batteries for different laptops. So batteries cannot even be reused across different laptop models from Dell.] But so is others using consumer durables from Samsung, LG and Eureka Forbes. These guys charge 3-5x the actual price for spare parts. But Dell is charging me 10x the actual price and still takes such a long lead time.

Major portion of Dell’s revenue comes from corporate and government customers. Those customers also need to bear with this problem. When I want to upgrade my office PC with a 1 GB RAM, Dell charged Rs.4300 for it. (In open market it costs around Rs.1200.) And I have to wait for 3 weeks to get the RAM!

Its time for Dell to revisit its strategy before someone solve this problem.

Scientific Discoveries

In the past five centuries, there was a burst of scientific discoveries. There were at least couple of ground-breaking discoveries every century. They completely changed our understanding of this universe. For example, when Heliocentrism was discovered, we suddenly were able to understand the motion of Heavenly bodies. Ttheir motion is no longer heavenly; their motion is no longer to dictate peoples’ life. Ditto that to Gravitation and laws of motion. They further advanced us to understand the functioning of several things in our day to day life. Wave theory and electro-magetism gave us more clarity. Then came the theory of general and special relativity. That again completely changed our understanding. There is no gravity; mass is no different from wave and energy. [If you still believe in school text books, grow up; there is no gravity.] When is the last time such a discovery happened? When is the last time all our understandings were invalidated and new but different and obvious explanations were given?

Why did a sudden bust of discoveries happened and then why did it subsidise? One valid and probably a real reason is, during the start of Renaissance, European scholars came across Arab and Chinese manuscripts that explained things that were new to Europeans. Actually several of the early discoveries are commonly known in China, India and Arab world. These ancient civilizations, took those things for granted and the pace of new discovery was very slow. But Europeans were ignorant of those things, and this information fuelled their scientific spirit. That let to a cultural change or what we know as Renaissance. Once the wheel has been set into motion, it let to further thinking and research that let to more discoveries and inventions. Initially the thought process was not institutionalized. But when the pace of growth increased, you need a framework to manage the growth; better channelize the growth and dissipate its benefit to the masses. By the end of 20th century, the framework or rather the institution took over. Spirit of innovation was replaced by redtape. Joy of discovery is replaced by short term utility. The growth engine has now subsidised and the world looks again like the mature Indian/Chinese/Arab civilizations.

All we need now is a crisis. Crisis leads to need to redefine things. Any redefinition or change in the current thought process will again start the positive spiral of second Renaissance.

Human Education

Recently I read a interview of Sam Pitroda. In that he remarked

Who decided that it should take four years to get a degree? Somebody decided 200 years back and we are continuing it.

That kindled me to think about the relevance of education. Incidentally on the same day one of my colleague mentioned that

In a hunter-gatherer society, a kid learns to survive in 7-8 years. But in our society we impart ~25 years of education to our kids, still not all of them are able to survive without assistance. What do we achieve by that education?

Robert Winston, when discussing about human brain size, survival and evolution says

Within just 24 hours a new born chimp is able to crawl…after two days, it is strong enough to hang onto its mother… We humans are born prematurely. … Compared with our humble cousins at birth, we are practically embryonic! … Between infancy and adulthood, the human brain is going to increase in size around fourfold.

…Because our bigger brains needs time and experiences to develop in those first few years of life, one of evolution’s solutions is to mould our emotions and understanding of life through play, so that we are as well prepared as possible for survival in the complex adult world.

In this context, why do we have to go through the formal education? Does 14 years of school education mold us to survive better? Given the way we are born, we definitely need education. How do we effectively impart that education?

Software Engineers? How many a penny?

I can see the effect of inflation everywhere in Bangalore. A KG of elaki banana now costs Rs.35. A Hamam soap now costs Rs.18. But value of one ‘commodity’ is getting cheaper and cheaper here. I need not tell, what it is. It is none other than the software engineer. Where ever you turn, you can see one. If you need one, just publish a ad. 1000s will turn up.

In an efficient global economy, one should produce only what he is good at. One should not try producing something, which someone else can produce more efficiently. In this way the entire system will operate at the maximum efficiency and trade of goods and services will flourish. In India millions of young minds are passing out from engineering institutions. So why not focus on SW engineering than trying to learn and do other things? Yes, we can do that provided we are good at it. But the bigger question is are we good at it? I am not going to answer this question. You yourself can think on it.

Another peculiar thing about this profession is, it makes so much of noise. You can hear the overused buzz words like, ‘innovation’, ‘creativity’, ‘challenge’… Due to this overselling, two things happened. One, these words lost their true meaning. Whoever was really doing those things lost their value. Second, every other guy whose title is ‘Software Engineer’ started believing that he is innovating.

To make it simpler, assume you have a dumb but capable servant working under you. Your job is to make him do work in whatever way you want. Is doing this job a innovative one? But this is what most of software engineers are doing. They are writing instructions to make a machine do some work…

No, I am not defacing the job of a software engineer. Every job is an important one. A guy selling movie tickets in a small town, does that till he retires. It is not as if he is doing some low grade job. Yes, it is a clerical job; still he fulfills his duty and contribute to smooth functioning of this society. But he never oversells his profession. Why don’t we software engineers accept that most of us do a clerical job and still be proud of it?

Passion is needed to do any work effectively. But we Indians are used to taking pride in almost everything and chewing on our past success. Life is much bigger than code and companies. Innovation comes into picture, when one does somthing that has some impact on our day-to-day life. Designing a cellphone is not an innovation, but designing it so that it can be used as finantial identity is an innovation!