Study Abroad Group 3's Blog - International Entrepreneurship Focusing on India

Look for updates other than just at the top of the page! Keeping the blog up to date has been a struggle so we're continually adding entries -- sometimes ones that happened several days ago.

On a more random note, before we left Mumbai we went to the site of ancient caves dedicated to the god Shiva.

We have seen much and posed our questions to business people, academics and people on the street. We have talked amongst ourselves and the other groups, asking each other what we are learning and what we might be missing. Along the way we have gotten what appears to be some conflicting information about just what role government is playing in entrepreneurship. This is truly a dual economy split between the rich and poor, but even that has not completely colored our answers. We have had varying opinions of how helpful the government is and this was not split along any obvious lines among the SME’s; however, the conglomerates almost all said that the government was helpful in their businesses. The government provided favorable legislation and tax incentives that were allowing these huge corporations to grow even larger.

Among the small and medium enterprises (SME) however the answers varied greatly and for differing reasons. The issues of graft were important to some and regarded as mere minor costs of doing business by others. They all had power generators to deal with the inevitable power fluctuations due to a woefully inadequate infrastructure. Some lamented the stack of forms and documents that had to be filed while others said that the absolute best thing that government could do would be to leave them alone entirely.

The government, especially the restrictive License Raj, was definitely an impediment to business in the past. That is changing but the government still has a long way to go. In order for businesses to truly thrive, the Indian government needs to do so much more than just get out of the way. It has to improve the essential infrastructure of the country--especially power supply, land records and education. The courts and legal system need to be able to resolve contract disputes within a reasonable time frame. For a country that puts such a high emphasis on education, the educational opportunities for the poor are limited. This country needs a work force and, while the big IT sector jobs may provide the bulk of the economic growth, most of the poor are going to be working in small businesses and they need to have the proper skill sets to succeed.

Today we are traveling to Mumbai (formerly known as Bombay). This is exciting. Mumbai has a unique history and culture.

Mumbai was founded in the early 1600s by a group of tribal fishermen known as the Kolis. Soon after it was created, it was colonized by Portuguese sailors who named it “Bom Bahia”, which means “Good Bay”.

The Portuguese had it for only a brief period. The king of Portugal presented it as a gift to King Charles II of England when King Charles married into his family. It was during this period that the name evolved from “Bom Bahia” into the more English sounding “Bombay”.

In the mid-1800s, Britain took control of the western part of India from the Maratha Empire. It was during this time period that the East India Company began to develop railways in Mumbai. This eventually led to Mumbai becoming an economic hub.

Mumbai really began to flourish during the American Civil War. During the Civil War, America’s cotton exports greatly declined and England looked to India to fill its needs. Mumbai’s cotton production declined at the end of the war, but Mumbai was already established as a major trading hub by this point. This was when certain Indians really began to emerge as being wealthy.

In 1875, the “Native Share and Stock Brokers Association” was started. This was the first stock exchange created in all of Asia. Now known as “The Bombay Stock Exchange”, it has grown extensively since its creation. It has had many accomplishments in its history. It was the first exchange in India to offer an online trading option, it t has an entire education center dedicated to teaching financial and trading skills, and it covers over 400 cities in India.

In the early 1900s, when Ghandi organized his movement for the liberation of India, it was the wealthy citizens of Mumbai who were his strongest supporters. It was these people who really funded his efforts.

After India’s independence, Mumbai remained a place with a large, educated population. Many good universities – many of them private -- opened up during this time.

“Bollywood” – one of the largest film industries in the world – was started in Mumbai during the 1930s. The name “Bollywood” is actually derived from combining the names “Bombay” and “Hollywood”.

In 1994, the “Indian National Stock Exchange (NSE)” was created. It too is located in Mumbai. In terms of transactions, it is the third largest stock exchange in the world, it covers over 300 Indian cities and it was the first stock exchange to offer electronic limit orders.

By the late 1900s the political party “Shiv Sena” came to power in Mumbai. The “Shiv Sena” is comprised of the Marathi-speaking ethnic group. When it came to power it changed the name of the city from “Bombay” to “Mumbai” which is a name derived from Koli culture.

Currently Mumbai is considered the “land of opportunity” to people all over India. As a result, nearly 100,000 Indians migrate to Mumbai every year in a search for jobs. This has led to an incredible amount of overcrowding. The streets surrounding the business centers are packed with homeless people. It is a city of very stratified wealth – it contains the very rich and it contains the very poor.

We had the pleasure of learning about the silk industry in India. We went to the Central Silk Board – a government organization dedicated to training people in all the steps of the silk trade. The training process takes students all the way from the cultivation of silk to the creation of finished silks product. This training empowers students to either become entrepreneurs in the silk industry.

We received an in-depth guided tour of the training grounds. First, we were taken into an office where a speaker talked to us about the organization. After this, they showed us the actual training areas where people practice silk making. This was pretty interesting. The first machine we saw took the cocoons of silk worms and unraveled them. What was unraveled was then re-spun into balls of silk.

After that, we saw machines that took dyed silk and wove it into patterns for garments. The machines that did this were very complex. There was an assortment of about 20 punch cards that all worked together to dictate a pattern to the machine. After we saw a finished product being put together, we were taken to a meeting room where we watched a video about the production of silk. All in all it was a very informative day.

Today we visited a very interesting company: Strand Life Sciences. Strand: Life Sciences started in 2000 as a consulting firm but quickly moved from that into the IT field of predictive biology.

What is predictive biology? The speaker use an analogy to explain it to us. The analogy he used was that an airplane, long before it is ever built, is designed, tested and corrected on computers. The goal of Strand is to take this same digital process and apply it to the life sciences.

So far, the company has designed a working digital model of the human liver. This is useful, because drug companies can test how drugs will react with the liver before the drugs are actually produced. This will show if the drugs are toxic or not. Having this knowledge will prevent drug companies from pumping money into failed ideas.

The platform that Strand has created is applicable to other organs that just the liver. Essentially any organ could be mapped. Strand has created this platform by combining the talents of roughly 20 people who have PhDs in the life sciences and about 20 people who have masters’ degrees in computer science. Our speaker said it was difficult to pay their employees enough to not leave them for another IT company like Google, but that the work was rewarding enough to prevent employee turnover.

The company has mostly been breaking even for the past several years or turning small profits, but the company believes it will start turning a larger profit in the near future.

In the past few years, the man who started the company was shot by four bullets during a terrorist attack. Amazingly, he was nursed back to health over the course of 9th months and his company survived without his leadership due to the high quality of management that the company has.

Due to India's poor IP protection laws and the average of ten years required to enforce contracts, Strand keeps its technology as Trade Secrets and carefully controls access to key information rather than applying for patents. Only a handful of principal employees have acces to enough info to be able to be a security risk. Another challenge facing the company as it grows is that the founder and CEO is a technical academician with little if any business training. Bill Gates is an obvious example of a technicician who was able to successfully manage his company from startup to corporate giant, but he is the exception rather than the rule. And even he eventually handed the reins over to Steve Balmer. Strand has been operating near break even for a couple of years and hopes to turn a profit soon but one can only wonder if they would have been more successful businesswise with more business oriented management.

One of the Entrepreneurs from our deep interviews Monday evening took us to a night club afterwards. The nightclub was on top of a 13 story building and had a beautiful panoramic view of the city. At a distance and at night, there was no poverty and it was all beauty under the starlit night. And the club felt like Atlanta or any other major American city. No saris, loud American music, and a good selection of American food, including beef, in addition to local delights. It was a nice break in a way, but it certainly didn't feel much like India. Tusar seemed bummed out – he felt like his culture was being obliterated. And I'd have to agree.

Tuesday we stopped for lunch at a mall the equal of almost any mall I've seen in the US with the exception of the Mall of America. Four levels of shops jammed with upscale Indian shoppers, mostly dressed in western apparel. There was a McDonalds, Pizza Hut, KFC and Subway plus a dozen or more non-American fast food outlets in the food court. Looked just like the US except that none served beef or pork. The hotdog place served chicken dogs. My subway came with lamb salami rather than bacon.

Counting Infosys, this is the third time in less than 24 hours that Bangalore has felt more like the US than India. This is more comfortable for westerners but it’s sad that the exotic and colorful Indian culture is being replaced by suburban America. Oh yeah, I forgot to mention that I had to walk past a begging 4 year old girl and through a metal detector to enter the mall. So it's only suburbia once you enter the mall and if you can avoid the rabid dogs that IIM warned us about.

Today we visited the Indian Institute of Management Bangalore, which is the premier University in the country – it could be considered the Harvard of India. We met with the head of the entrepreneurship department who spent the morning talking to us about entrepreneurship in India and the school’s role in it.

She started off by explaining the differences between entrepreneurs and businessmen. According to her, an entrepreneur is an innovator who is always looking for creative opportunities to make money. A businessman, however, is a person who has to do any readily available odd jobs to support his family.

An example of an entrepreneur would be a person who starts his own IT business in the hopes of it growing into something successful. An example of a businessman, however, would be a street vendor who sells food on the side of the road as a means to support his family.

Both of these are prevalent in India. India has had a huge growth in entrepreneurship in the past ten years. And then, all one needs to do is walk down the streets of Delhi or Chennai to see the huge numbers of street vendors selling food, clothes, jewelry and other similar items.

The gist of policymakers in the past several years has been a move to supporting the entrepreneur. The reason for this is obvious. A businessman thinks small. He has one station on the side of the road and he can barely employ and support himself. The entrepreneur, on the other hand, is thinking big and creating jobs for more people than just himself. He is actively supporting the economy.

The goal of the entrepreneurship department at the Indian Institute of Management Bangalore is to provide training for these people who wish to be entrepreneurs. For one thing, entrepreneurs need to have a very a lot of business skills and the institute hopes to give the entrepreneur these skills. Therefore, general finance, marketing and accounting are offered to the potential entrepreneur.

A lot of people with computer backgrounds go through the program. India, after all, has a huge IT industry. The institute hopes to give these people the business skills they need so that they can truly utilize their IT skills.

The school also has an entire program dedicated to training women. Roughly 70 to 75 women attend every summer.

A surreal moment came during a discussion of India's infrastructure problems when one of the speakers talked about a serious problem of children being attacked by rabid dogs in Bangalore. Yes, rabid dogs. Apparently one of the NGOs had blocked legislation to spay, neuter and immunize animals for some misguided humanitarian or religious reasons. The speaker then opined that perhaps Democracy was not the best way to bring about rapid improvements and that perhaps the country would be better off with a benign despot. Given the challenges still present in India, one can only be more impressed by the strides that IIT is making to improve the economy and everyday lives of Indians.

Infosys – Through the Looking Glass
Infosys is the premier Indian IT Outsourcing (ITO) and Business Process Outsourcing (BPO) firm and their lush sprawling campus resembles nothing we’ve seen in India. It looks more like EPCOT or how I imagine the Microsoft or Google campuses. Lush green lawns, tree lined drives, lakes, food courts, fountains, absolutely no litter and the futuristic buildings looking like something from a Star Wars film set. No laptops, cameras or even cell phones are allowed on the campus, so alas we have no pictures of this geek paradise. No automobiles are allowed on campus so we are shuttled from the main gate to the building containing the welcome center in 8-seater electric golf carts.

A female PR operative presented a canned PowerPoint outlining the company’s progression from humble 1981 startup with an initial investment of $250 and 8 employees to the current juggernaut with over 52,000 employees and on track for $3 billion in revenues in 2007. From an entrepreneurial perspective, it is unusual and interesting that the founder, Narayana Murthy, is still the CEO. Most entrepreneurs step aside or are replaced as their companies grow. The aptitudes and attitudes required for creating ventures are different from those required for large corporate management and few entrepreneurs can successfully manage the transition. Unfortunately, we don’t get to meet Mr. Murthy or anyone other than the PR lady.

Compared to the rest of India, the Infosys campus is as surreal as Alice's Wonderland but the analogy accelerates when the PR rep assumes the Mad Hatter role and presents a slide slide equating the quality of India’s Overall Infrastructure and Legal Systems with those of Canada. Since when has Canada had a problem with chronic power disruptions, unsafe drinking water, pitiful roads, rampant government corruption, an ineffective legal system, sewage in the street and a health care system where needles are reused and diseases such as polio, diphtheria, typhoid and even the black plague still exist. Don’t get me wrong – I like India and the country is moving rapidly in the right direction – but one must be realistic about the limitations and challenges of the current situation.

Every other entrepreneur and professor we’ve met has noted the limitations of India’s infrastructure and legal systems. When questioned about this slide, the Infosys rep insists that it’s true and cites Forrester as the source. To compound the irrationality of defending such an obviously inaccurate assessment, another slide in the same presentation gives India’s infrastructure a rating of only 2 out of a possible score of 4. The power of a successful brand gives authority to its claims but in this case an audacious claim has seriously damaged the company's credibilty with regard to any other claims. It’s pretty much down hill after this point and we are all but given the bums rush onto the shuttles back to the gate after only staying half of the time allotted for this visit.

Here I am on the Chennai to Bangalore train listening to an eclectic mix of Gwen Stefani, Carol King, Traveling Wilburys, Mary Chapin Carpenter, Michael Jackson and others on my Ipod. We got up at 4:00 am to catch the bus to the train station for the 6:00 am train. The city streets were quiet and almost deserted for once and also for the first time outside in Chennai, I wasn't sweating profusely. It was actually quite pleasant at 4:30 am except that it was 4:30 am. Once we arrived at the train station the serenity was shattered by a hustling mass of humanity at similar in size to what you might see in the Atlanta Airport on a Friday afternoon or the beginning of a holiday. It's a bit smelly but the odor seems to come more from agricultural products (I think) than from the people. The train is old but pretty clean. I'd guess it dates back to the 30's or 40's. Tray tops are slightly bent and thick with multiple coats of paint, but quite functional and clean. They also seem to feed us frequently. Small portions but frequent. First breakfast at 6:30 was 4 thin shortbread cookies, 2 small pieces of chewy, toffee like candy and a tiny cup of coffee. Second breakfast at 7:30 included a small cup of tasty vegetable soup, a milky looking cold liquid I decided not to try, about half a cup of something tasting sort of like grits but containing a few soft nuts or hard beans (not sure which) and some herbs, plus two piece of very thin white bread with butter and jelly. That may sound like a lot but the portion were all very small. But then again I'm not hungry either – so no complaints.

Bangalore seems cleaner, more modern, cooler (well if you can call low 90s cool) and much less humid. A relative paradise after the heat and humidity of Delhi and Chennai. And the hotel is very, very nice except that most of the staff other than the front desk don't seem to understand english. They apparently have learned certain phrases that they emit but they don't seem to really understand anything we say. So they are sort of like benignly malfunctioning robots out of a sci fi movie, going around on their assigned tasks regardless of what's going on around them. For example, they will deliver the complimentary fruit to your room even when the Do Not Disturb light is on and you tell them you don't want it. Kind of comical except when it takes half a dozen requests to get your check or change back on the check. I suspect they consider our tastes, requests and general mannerisms just as inscrutable. But they are always, always deferential and polite -- well, except for the Tutt-Tutt drivers who argue about the fare after they deliver you to the destination.

There's a nice chinese restaurant in the hotel where several of us ate lunch while the less adventurous ones went to Pizza Hut or KFC nearby. Ordered a coke and the waiter presented the bottle like a bottle of wine for my inspection. I was tempted to sniff the cap. The hotel insists the water and ice here are safe -- so I had ice in my coke. Hope I don't regret that.

This morning Kenn, Austin, Zoe and I got to take a ride through the streets of Chennai on motorcycles wit journalist from motor Vikatan magazine. Surprisingly, I felt safe even though the horns were blaring and we were swerving between buses and bicycles. The difference between America and India is that in India drivers expect for someone to be there, where in America that expect that you are not. The journalist took us to the beach a few miles down the road for an interview on Indian roads and a quick photo shoot of us on the bikes. We then rode to meet up with our tour bus for sightseeing. On the way we passed the beaches filled with fishing boats, nets and of course the usually scenery of trash. We also passed the Chennai fish market consisting of fish and crab laid on banana tree leaves on the street side. On a side note, I’ve developed a hacking cough that I have self diagnosed as due to the pollution I have incurred here in India All in all this was a great experience. Readers look for the article in the July issue of motor Vikatan or online at www.vikatan.com.

It feels good to post to the blog again. Keeping it up to date has been a struggle. Since we've been here, we've been faced with limited internet access that is usually expensive. Getting on tonight cost around 10 dollars. Fortunately, though, everyone in the group has been willing to pitch in so that we can get online.

Our last visit of the day was to Great Lakes University in Chennai. Although we might have had to drag ourselves in because we were exhausted from our meetings earlier that day, we perked right up as we listened to many motivational speakers including our very own Jim Beech and Joi Fasion.

Each school shared their entrepreneurship course objectives and thoughts on entrepreneurship as a school. Professor Beech seemed to inspire and motivate the entire room. He also entertained many questions from the Great Lakes students in an informative Q&A section.

Following the presentations we were given the opportunity to talk to the students of Great Lakes. This was a wonderful opportunity because it really gave us a chance to speak with students our own age and discuss entrepreneurship with them.

One of the interesting things I found about the students was that they were almost all from an IT or Software background. Also, one student was telling me that many Indians are apprehensive about starting their own businesses because if the business failed then it would be hard to find another job. They said this was so because employers would consider them too entrepreneurial and think they would be more likely to leave. I believe we have this same issue in America, but it doesn’t contribute to a fear to start a business. It was very inspiring that of the three students from Great Lakes that I was talking to all of them had business plans in the works with still a year left of school. When asked what was stopping them from starting their business now they all said that it was because their parents disapprove. The students explained that family is very important in India and losing the support of your parents is harder than I would think. Another challenge discussed was that any business in India must offer health insurance for there employees and this can be difficult for a small business just starting out.

It is kind of funny that all the entrepreneurs and students that we are meeting want to know as much about us as we do about them. The students of Great Lakes had numerous questions about entrepreneurship for us to answer, so many in fact, that we invited the students to join us for a social at our hotel the following day.

The next day we were surprised to find ourselves on the second page of the Hindu Times. This was very exciting for our group.

Today we saw some of the brightest lights of India’s future. It began this morning at IIT Madras with a visit to their rural technology incubator. There are over 600,000 villages in India and an enormous amount of challenges to overcome if the rural sector is going to share in the benefits of India’s economic growth. The incubator sees “Entrepreneurship as the best way to drive the development dream for the country.” We, as entrepreneurial students appreciate that both the technologies and the companies, which come out of the incubator, are designed to be both profitable and socially beneficial at the same time. They could potentially change the face of rural India by increasing access to health care, agricultural assistance, education and more.

Dr. Jhunjhunwala is the director of the incubator and his personal experiences provide some of the best illustrations as to why their work is so important. He moved back to India from the United States in 1984 and ordered a phone from the state run telecom company, 8 years later it was installed. That was not a typo; it took 8 years for him to get a telephone. In 1992 when his phone was installed there were only 7 million phones in the country, and most of those were in the cities. His work at IIT was designed to improve this inefficiency and to get the technology into the rural sector. Today there are over 175 million phones in use and new ones are being added at a rate of 6 to 7 million a month. The incubator brings together what they consider to be the three crucial elements necessary for success, a faculty member, an experienced industry professional and a young student. The faculty member brings wide knowledge; the professional knows what is feasible, viable and possible to manufacture; and the student who does not know that it is impossible, are all necessary to the process of innovation.

The new focus is increasing the rate of Internet connectivity to the villages just as it was done with the telephone. The project is so much larger than just getting the villages online and as with anything of this size and importance it does come with its share of hurdles. They need to overcome resistance to costs, ignorance of the possibilities and the skepticism of the villages. If they can accomplish this, and I am confident that they will, then the benefits will be enormous.

The villages in India are very poor and computers are not cheap, so one of the projects to come out of the incubator is building less expensive computers and connectivity hardware. The hardware and connection is primarily seen as a delivery platform for information services. Even with a great reduction in costs the computers and related hardware are not cheap, so part of the model is setting up an entrepreneur as the owner operator of a kiosk where villages can access the Internet for a small fee. They have a specific type of entrepreneur in mind and she is a woman who is married with some education. Many women get higher education but then stay in their villages to remain close to their families. They want her to be married so that they know she will not move away and educated because she needs to be able to teach her customers how to use the technology. She needs to be female because most men would spend the revenue generated on alcohol. The associated start up costs run about 25,000 Rupees ($625). The project helps to set her up by providing assistance with funding and training on operating the kiosk as a business.

One of the possible uses is as an education kiosk. Many of the village’s children are proficient in math and science but are lacking in English skills. For a fee of 1-3 rupees a month a child can use the kiosk to hone their English skills. In early applications of this service the pass rate for those that used the service for an hour a day for 90 days was dramatically increased.

Another type of Kiosk would be a medical kiosk. This kiosk is really unique. In addition to the computer there is an additional piece of equipment that will actually relay real time medical information to a Doctor or medical professional to give advice and diagnoses. Each village does not have its own doctor or any other type of modern medical professional, but usually there is someone in the village that is trained in traditional medicine. The mortality rate in rural India is on par with the urban areas so there is some definite validity to traditional medicine. The kiosk would not replace this person but would be there to step in when there are situations that they cannot handle.

There are agricultural uses for the kiosks as well. One of the technologies to come out of the incubator is a portable weather station. This can give farmers immediate information about conditions that will directly affect their crops. Indian farmers are notorious for the overuse of pesticide; another use of the kiosk is to help reduce their use of shock and awe tactics when it comes to pest eradication. With the kiosk they will be able to bring an insect to the kiosk operator who can send a live image of it to the local university or agricultural expert who can then identify the pest and recommend the proper amounts of insecticide and application techniques.

These are just some of the current applications of the technologies that Desicrew, the incubator company, is currently in the process of implementing. There are kiosks in over 2500 village, which is an incredibly small portion of the villages, but there are plans to be in over 100,000 of them in the next year. They believe in entrepreneurship and their business is a combination of opportunity and need. The opportunity is the vast revenue potential that can be captured in such a wide net and the villages need the jobs and the knowledge. Expect great things from Desicrew.

We met with the Mr. P Viswanathan, the Executive Director of what is often referred to as an offshore call center. He says we can just call him PV. The official industry term for call center that PV prefers is Voice BPO where BPO is an abbreviation for Business Process Outsourcing. See the blog entry for First Source for a discussion of Non-Voice BPO. He explains that the primary driver for the BPO industry is companies seeking to focus their energies on their core competencies. For example a hospital uses computers extensively but healthcare is their core competency. So rather than hire and maintain a staff of computer people to provide support for the hospitals computer users, they outsource the help desk function. This explanation is right out of the textbook and makes sense when implemented that way. However it implies that any company that out sources customer service does not consider customer service to be its core competency. As with many businesses in India, employee turnover or attrition as it's called is a large problem. Allsec attrition is on 35% in and industry where 39% is average. Employees are given 8 weeks of intensive training on cultural issues and accent reduction followed by 4 weeks of closely supervised "apprenticeship". Thus an employee does not generate positive cash flow until after 12 weeks and that cash flow must first repay the 12 week of negative cash flow before an employee can be considered profitable. Nonethe less, the company is prosperous. We inquire ways American companies require employees to reimburse their employers for training if they don't stay for a specified minimum time. PV explains that the cultural and soft skill training he provides his employees is not specialized enough for such requirements to be legal in India. When asked about the scripted nature of tech support services we've all encountered with offshore tech support, PV explains that his clients must provide all of the information and that his employees just deliver the info. In other words, he doesn't hire computer experts capable of solving problems. He only hires people that can follow a script. This explains a large amount of my frustration with outsourced tech support. PV also explains that his client companies require that all agents adopt American names and that they are strictly forbidden by their client to reveal where they are actually located.

Jamila(My roommate) and I have for some reason managed only about 5 hours max of sleep a night. Although we attempt to drift to dreamland much earlier it seems as though Jamlia gets a little slap happy in the wee hours of the night and I find myself awake and laughing at her comments that are laced with her spunky attitude as we blog and strive to figure out dreamweaver. Finally I just have to tell her to stop talking and we force ourselves to sleep to be able to endure the next day’s work.

Dr. Nathan warned us of the potential perils of Indian food , we should have listened to him. Not everyone has made it to every event. The mix of rich, soupy foods and heavy spices is a brutal one. When we first arrived on the trip, the temptation of exotic Indian food was too much to pass up. This was a temptation that came back to haunt many of us. Tums and Immodium have become heavily traded between us. Several of us even had to forego today’s company tours in favor of staying very close to much needed facilities. As for me, who shall remain nameless, I have learned that if my Indian teacher tells me to take it easy with the Indian food provided on the train that I should listen to him. How I wish I could go back in time and listen to him.

Our last meeting of the day today was at a Business Process Outsourcing (BPO) organization named Firstsource.

A BPO organization is an organization that another company can use for everyday tasks. For example, it would be a waste of time for an advertising company to do anything other than work on advertising projects. Therefore, it could outsource its everyday tasks such as payroll to a BPO.

Being a BPO organization, security was paramount to Firstsource so that delicate information about its clients would not be leaked to the general public. On certain floors, it was forbidden to travel with paper, pen or cell phones in tow. People were even frisked to make sure that they didn’t take anything delicate.

Of all the informative things that we learned during their presentation, the most interesting thing we learned was about their business relationship with Amazon.com. Apparently, the majority of books that are supplied by Amazon are not stored in an inventory warehouse. They have actually not been printed yet. Then, as soon as an order is made online, the order is sent to Firstsource which prints the book and then sends it to its desired location. Apparently they process up to 150,000 documents a day.

We met Mr. Sarangi on the flight from Delhi to Chennai, the conversation was a great way to spend the 2-½ hour flight. Mr. Sarangi is a plastics engineer and also has his MBA. He is employed by Motherson Auto ltd, which is an OEM supplier to the auto industry and specializes in plastic components. He was on his way to visit the Chennai plant, which he does once or twice a month, in his capacity as a corporate engineer overseeing quality controls.

He had some interesting insights to offer regarding the state of entrepreneurship in India. He has had entrepreneurial aspirations of his own for the past 10 years and would have started his own manufacturing business however there is nowhere for him to raise the necessary capital. This may need a little perspective. Mr. Sarangi is a plastics engineer with a MBA and 19 years of experience in his field. His company purchases underperforming manufacturer plants and then sends him in to make them profitable. He estimates that with a total investment of $250,000 he could start a similar business of his own. He has a proven track record and estimates his chances of success would be very high but raising the startup capital is extremely difficult. If he had access to the funding options that are available in America he would already be an entrepreneur. If he had $250,000 today he would be an entrepreneur in India tomorrow.

One of the other things that he explained to us was the level of risk that Indians face. There is no social security system and adult children have the obligation of caring for both their own kids and their parents. The security of a good job may not result in huge financial rewards but it means that these obligations can be met. Family is very important and many Indians desires are only to meet these obligations. So the rewards of entrepreneurship are not as important to them and the risk of failure is unimaginable.

Today was a day for travel and to catch up on our work. For Jamila, Joi and I this meant time to search for the beautiful Indian saris to take home for souvenirs. A sari is a 6-yard long piece of fabric that is wrapped around the body to form a dress. These dresses come in a variety of colors and designs and are the traditional dress of Indian women. They can be silk, a silk cotton mix, or pashmina wool. Passing through the streets in India you will probably never see the same sari twice. It is not like having a Gap on every corner, they are very unique. This is why the three of us girls were passionate about the idea of purchasing saris for a keepsake. Being adventurous we hopped into an auto-rickshaw (a three wheel motor car) outside our hotel and directed the diver to a store suggested by the concierge at the hotel. After haggling with the driver over taking only one auto ricksaw and the store we wanted to go to we were off into the fascinating city of Chennai. Jolting through the streets we observed we were being observed and quickly put away our video cameras in an attempt to look least like tourist as possible. It was as if the Indians do not see many Americans because they all stared at us as we shopped, but it was quite possible that we were violating some cultural norms. Anyhow, we managed to purchase some beautiful saris that we can’t wait to try on.

We were curious why the driver was so set on taking us to that particular store, so we asked. He explained that the store was a government shop and a portion of the proceeds from that store go to pay for uniforms for the school that his children attend and for things needed for their education. We were more than happy that we bought from that store knowing this.

As we traveled back from our adventure we stopped by two more stores that the driver recommended that were much more up scale than any of the other stores we had seen. It is fascinating how there can be such a difference in stores in one street. A dumpy jewelry shop is in one place and a much nicer shop that is closed in and air-conditioned on the next street that sells the same stuff.

The bus ride form the hotel to the airport takes us through some pretty nice neighborhoods with large houses and pleasant looking parks. At one point we get a view of the skyline with numerous tall buildings. The plane and flight processes are good to excellent, the airline personnel friendly and efficient and I get a glimpse of the city from the air -- it looks a lot like Atlanta, only larger. From a distance, the poverty is invisible and I think I spot a park that reminds me of Central Park. The mind boggling poverty we’ve seen on Monday and Tuesday have taken a toll on our psyche’s that’s not easily shaken but for a few minutes I feel almost like I could be back in the states. I feel better, more optimistic, and I’m not alone in this brighter outlook.

But then I feel guilty for being comforted by not being faced with the squalor observed Monday and Tuesday for the poverty doesn’t cease to exist just because I’m not looking at it at the moment. Erik and I discuss the notion and supporting research that poverty does not necessarily equate to misery. Are we doing this to reduce our feelings of guilt and discomfort? I honestly don’t know. Several students remark that this is a world far different from anything we’ve encountered before. One student remarks that India is more different than Mars is from our lives back in the states and I find the Mars allusion ironic since I named a previous entry after the classic 60’s novel about a human raised by Martians.

I believe money can’t buy happiness but it’s hard to believe these desperate, begging people living in such pitiful conditions are happy and that a few more material comforts obtainable with what’s so often called the root of all evil wouldn’t help. So as they say, it may not buy happiness or love, but money can sure make misery more tolerable.

It is hard to believe that we have been here for roughly two days. The experience has been both humbling and overwhelming at the same time. Our hosts have been generous beyond belief sharing with us their hospitality and their perspectives on the state of entrepreneurship in India. We have definitely hit the ground running with little time for much else other than meetings and travel. The time for coherent blogging has been limited but I am going to try to catch up. Hear are a few sporadic thoughts.

Delhi has been quite an introduction to India. It looks as if it is a city that is the midst of decay and rebirth at the same moment. The numbers of people living on the streets and sleeping on the sidewalks is extremely difficult for me to get my mind around, especially as I am surrounded by opulent air conditioned comfort. It definitely made me reconsider my complaints of discomfort on the plane as I saw people with no blankets, pillows or anything else between them and their heads as they slept on the sidewalks. It feels at times like we are on safari and completely disconnected from the masses as we are whisked through them, apart of the swarm yet completely separate from it at the same time.

Entrepreneurship is everywhere and from what I have seen it is both need and opportunity based. The poverty forces people to come up with novel ways of feeding themselves daily. Everyone is hustling to find their next rupee, while at the same time wealthy entrepreneurs have been opening institutions of higher learning There is an abundance of colleges and Universities in Delhi along with a real hunger for higher education in anticipation of the jobs that it will lead to. In today’s edition of the Times of India there was an article that mapped out all the colleges in Delhi and gave suggestions on how to obtain and fill out applications and strategies for dealing with the competition.

The traffic is amazing. Drivers, cyclists, pedestrians and wildlife don’t seem to adhere to any firm rules but only loose agreements. Signs and lane markers are not commands but merely suggestion which we saw as six lanes of traffic form on roads that are set up for only four.

As we were leaving Agra, Barron was attacked by a gang of vicious entrepreneurial shoe shiners. They mercilessly soiled his topsiders with a mystery paste that could have been shoe wax or toothpaste and then got upset with him when he would not allow them to remove it for a fee. Barron, utilizing skills that would get him far on the gridiron, tried his best to evade the persistent shoe shine man, but he was just too good, too experienced, too determined and Barron was taken down a second time as another coating of mystery paste was rapidly applied to his shoe. In the end, Barron emerged the victor, battered yes but it was the shoeshine man that had to walk off his defeat as he readied his paste for another pair of foreign shoes.

None of what I read or heard about India prepared me for the things that I have seen while being on this trip.

In my mind, I imagined a place comparable to Atlanta –- successful businesses mixed with a population of homeless people. The situation here though is so much more extreme than I would have ever expected. It’s not just a population of homeless people – outside of the hotel there are literally miles of shanties that entire families live in. While traveling the city at night, one can see dozens of people asleep in the medians. Wild animals (specifically cows and bulls) walk the streets while bicycles, mopeds and cars casually steer around them. The comparison to Atlanta wasn’t remotely adequate.

What struck me more than anything, though, was what I saw today. After driving past miles of shanties in the Indian countryside, we came to a 5-star Hilton. It was stunning to see how stratified the wealth in this country is. Of the 1.2 billion people in this country, roughly 700 million are impoverished. That means that the amount of impoverished people in India is twice the number of total people in the United States.

Yesterday ( the 21st) we visited Niesbud –the national institute of entrepreneurship and small business development. While there, I was caught by how different entrepreneurship can be around the world.

For example, the average business started in America is a service related business. In India, however, most of the businesses created are industrial. This drastically changes the start-up costs of a business. According to Niesbud, a micro company in India (the absolute smallest type of company) usually has a start up cost of about $50,000. A micro company in America, however, would cost significantly less. A small import/export company that only sold items over the Internet could be started for only a few thousand dollars.

Scott went solo and visited Pyramid IT Consulting at the invitation of company President and founder, Sanjeev Tirath. They met May 15 at the MIT Enterprise Forum event “Doing Business with China: The Evolving Paradigm”.

The Pyramid management team headed by COO Manish Jhanjee and including Product Manager Ashool Handoo and the Manager of Business Development, Mike Singh were extremely gracious hosts and spent most of the day with Scott. In addition to impressive presentations and demonstrations of Pyramid’s products and services, they discussed Indian Entrepreneurship and many interesting cultural topics and business issues. The Pyramid team opined that the government burden or obstacle to entrepreneurship had not improved in any significant manner. The explanation being that the local people enforcing government rules and working government processes had not changed and that they still required bribes. The burden of such corruption continued even for an established company such as Pyramid. They also shared that one reason for the boom in service industry is that electronic delivery provides far fewer opportunities for local officials to interfere with business processes and demand a bribe. I’m beginning to believe the Indian government has more in common with the Mafia than with a the US government.

Visiting Pyramid required a car trip that left no doubt, as Dorothy might say, that Scott was no longer in Kansas or anywhere else in the good ol’ US of A. Fortunately Pyramid provided a private car and driver as Delhi traffic and driving habits boggle the mind accustomed to orderly, albeit heavy Atlanta traffic. Lanes are even less respect than in Boston and “rules of the road” is an oxymoron in on par with jumbo shrimp and military intelligence. British style driving left of center is disconcerting to Americans under the best of circumstances – but it raises the anxiety level more than a bit when one’s driver or other vehicles drive on the wrong side (i.e. the right of center) when convenient or the mood strikes. When faced with a wall of oncoming traffic, the fearless driver plowed ahead with apparent certainty the stream would somehow part enough to get through. Hesitation is apparently a sign of weakness, not to be revealed without dire consequences. Then there are the swarms of motorcycles, auto rickshaws, rickshaws, animal drawn carts, human drawn carts, roaming cows, dogs and other animals as well as pedestrians competing to exploit every crevice between the larger cars, trucks and buses. Not surprisingly, most side view mirrors have no glass and are folded back against the side if anything more than a vestigial stump remains.

To complete the Twilight Zone experience, add incessant horn blowing, a barely functional AC, rare if any traffic signals and a driver with marginal communication skills despite minimal accent and apparent comfort with English and a second (or is it first) job as a senior marketing executive for a real estate development firm. For example, he asked “When am I coming to Atlanta?” I believe this was his subtle way of asking for a job with a relocation package.

The electricity has “gone out” several times in our first 24 hours in Delhi. Dr. Nathan had warned us about these small, “rolling blackouts” and had explained their cause as power plants lacking the capacity to meet peak demand. This understanding may have reduced the “startle factor” or worry when one occurs but it does nothing to lessen the direct cost burden on business and the indirect burden on all consumers indirectly through higher prices. These private generators also contribute to Delhi’s significant air pollution problems.

There are countless small and often subtle differences that are more humorous or curious than problematic, such as potato chips and baked beans at breakfast and tiny rolls of toilet paper with sheets that are both narrower and longer than in the US. Most of these differences have no significant impact on the economy or individuals but infrastructure problems like traffic, power, water and communication all place a significant burden on both business and consumers. I wonder how many of these issues and their severity are caused by India’s socialist heritage vs. the sheer number of affected individuals.

We are finally here!

After weeks of anticipation and careful planning for what to bring, preparing our surveys, pre-trip meetings, and arranging for our homes to be left for two weeks we have finally arrived in India. The last day and a half has been quite interesting as we boarded our plane in Atlanta and made our way to India. The first flight from Atlanta to Newark proved to be interesting as the American man seated next to me spoke of his son who actually is and entrepreneur in India, developing property. What a coincidence! The next 12 and half hour flight from Newark, NJ went by rather fast as I managed to sleep a good bit of ride. We only had one minor panic along the way when one group member misplaced his passport. An extremely frantic ten minutes went by before the passport was found and all was well.

Even though it was night when we arrived the heat was more than we were used too, a dry heat. The second we walked out of the airport we were bombarded with men offering to help with our bags. They would not take no for an answer. I walked half way to the tour bus jointly carrying my bags before I gave us and let the porter take then. He then turned and insisted that I pay him American dollars for carrying my bags about twenty feet. Another man not even carrying my bags asked to be paid to. So, no time past at all before we got a taste a poverty in India.

As we drove to the hotel the first night we were all amazed at the chaotic manner of the traffic. Although we were warned of the traffic in India there is nothing like seeing an entire family on one motor scooter racing between cows, tour buses, auto ricksaws, and the bicycles with no order at all. It is hard to imagine a man, women, child and a young baby all on a scooter with no helmets. No family would be able to do this in the United States.

There was a lot to take in on our first night in India and we are anxious to start our day tomorrow.

Our guest speaker on Tuesday discussed his recent work with RFID (Radio-frequency identification) technology. RFID tags are electronic devices that identify and locate any item they are attached to. RFID tags could potentially replace barcodes on commercial products. Having these tags in place would make the inventory-tracking process of stores instantaneous.

As exciting as this is for businesses, it is a scary thought that these devices could be attached to human beings. If we were represented with chips, couldn’t our identities be stolen very easily? Would our every move be tracked? These are all issues to think about.

According to the Economist, McKinsey and Company, a consulting firm, has estimated that the annual growth rate in India for the next 20 years will be 7.3 percent. Under this assumption, India will overtake Germany (currently the world’s fifth largest consumer) in terms of consumption. As a result, the Indian middle class will get bigger and bigger while the poverty stricken population of India declines. This means that exciting times are ahead for India.

Scott missed class on this evening in order to attend this event. The keynote speaker, Dr. Jag Sheth made numerous provocative and perhaps controversial points regarding both China and India. Please don’t argue or be angry at Scott if you happen to disagree with Dr. Sheth’s analysis, opinions and predictions (below) as he is only reporting what was said.

India is in the midst of an exciting time. According to the BBC, the Indian government expects their economy “to grow at a rate of 9.2% in the current financial year”. In addition, the country’s stock market is at an all-time high and India is increasingly viewed by outside investors as a good country to invest in.

During this time, according to the World Bank, the government is providing more services and more freedoms to its people. Recently, the Indian government passed the “Right to Information” law, which allows its constituents greater freedom to information. This allows the peoples of India to hold their government more and more accountable for its performance and services.

However, in spite of all the good things happening in India, the inequality of wealth distribution has greatly increased. According to the World Bank, the 99.99th percentile of the Indian population makes a salary roughly equivalent to $160,000 a year (after purchasing power parity is factored in), while much of India has the wealth equivalency of rural African states. The economy is growing, but not everyone is benefiting from it yet.

While reading through Wall Street Journal Articles about India, it becomes abundantly clear that we are going to a very different world. Most of us take for granted the safety of the commute to and from Georgia State. MARTA even advertises itself as being one of the safest railways in the country. But what is it like for people who live in India? Specifically, what is it like for people who live in the city of Mumbai?

Mumbai (formerly Bombay) is a city undergoing rapid growth. In India, it is viewed as the city of economic opportunity. As a result, the railways of Mumbai have become subject to dangerous overcrowding. During the weekday rush hours, the trains run with 2.5 times the amount of passengers that they can safely accommodate. An average of 13 people are killed every weekday – either from being pushed off the trains or from being trampled.

With money on loan from the World Bank, measures are being taken to make the trains safer. However, it is projected that the trains will still be running with 1.5 times the amount of passengers that can safely ride. Mumbai’s economic growth has made its railways very dangerous.

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