Globalization and the Rich and Famous

Globalization , we knew was leveling the playing ground for your typical middle class young person whether in China,India, Eastern Europe. Latin America  or Africa provided they had good reliable Internet access.

It was therefore interesting to read the Rana Faroohar’s Newsweek article on how the rich and famous  have changed with globalization. The earlier more feudal model for the rich was to have one place where you grew up – your kids went to the same college for four generations and you supported all the local institutions. All this is changing according to Newsweek. Now the rich are much more nomadic and might come from the developing world. The Indian steel tycoon Laxmi Mittal is a good example. Mr . Mittal  grew up in Rajastan, India in  modest  circumstances and simply decided to take up the export end of the family steel business. He’s now reported to be the biggest steel tycoon of the world a very much old world business; but his lifestyle from the most expensive home in London to the flamboyant daughters wedding in France  and his India visits are all pretty free flowing- globally .

The really rich are today no longer rooted in one country and keep moving around – they also do not restrict their philanthropy to local organizations. Consider the good works of the Bill and Melinda Gates Foundation in Asia and Africa. Clearly great telecom and the Internet is helping all this and the feudal model and family homes like Blandings Castle for Lord Emsworth in PG Wodehouse is all changing.

Oreos,Philadelphia Cheese, Maxwell House Coffee

Oreos,Philadelphia Cheese, Maxwell House Coffee are the great brands from Kraft Foods the world’s second largest food company  (Nestle is the largest). Kraft just announced a 1.7B$ outsourcing  deal for IT management including hardware,software etc. to EDS. EDS in turn will partner with companies like Dell,Microsoft,CISCO,Dell. Kraft says that they’ll have a mix of in-house and outsourced activity to keep IT at Kraft at world class levels. Indeed IT systems are an enabler and you need contractors and providers who are very very specialized and can come together and offer world class solutions on a continuous basis. Kraft’s business is continually figuring out the very competitive food markets in 150 countries with 34 billion $ in sales. It cannot keep hordes of folks in  house who’ll just look after the network and will not be very efficient in it anyway. As I mentioned at an earlier post IT seems to be going the way of electricity industry where electricity companies took over from in house generators of the industrial world. From the days of mainframe computers and major IT personnel (1980’s)we saw the decline of the in-company "IT raj" with the advent of PC’s in the early nineties. IT departments are now morphing to a lean strategic thinkers with everybody else specializing with different providers. For Kraft 670 folks will join EDS. In-company IT leaders will have to become true leaders in anticipating and delivering state of the art solutions from OSHA compliance in New Jersey to distributor stocks in Shanghai depot instantly to concerned managers….

Global Outsourcing Seminar

I had returned from a gruelling but very enjoyable trip to University of Missouri, Columbia (more on that later) and then was absolutely delighted with the CAPM Global Outsourcing Seminar, the speakers and the participants. Check out the photos here.

Sales Force Automation Problems

I am off to the University of Missouri Columbia to present my paper on outsourcing of the adoption problem that besets Sales Force Automation. Quite simply Salespeople don’t like being monitored constantly (who does?). I have a theory on this but need to check out what other leading sales scholars and experts think about my solution. Check out the Program here.  This is turning out to be a busy week ahead with the Global Outsourcing seminar of CAPM scheduled for Tuesday but all this should be fun.

Outsourcing Forensic Investigations

The academic field of inter-organizational relations also called Business-to-Business Marketing or Purchasing is really getting very interesting. Consider the outsourcing of Forensic investigations. The State of Georgia has sent out 7000 cases for investigation to crime labs in Louisiana etc. as there was a huge backlog. The current concern is that as legal processes move forward the costs of flying in witnesses will add to the cost of outsourcing. Will the testimony processes of courts change ? Will video conferencing become "legal" ? Will the judicial system and the bar of one state be able to collaborate electronically with another state ? Will such collaboration be more or less costly than the costs of flying in witnesses ? I can literally see transaction cost economists and a host of other legal and inter-organizational scholars enjoying investigating these questions…

The “O” word and fears of layoffs

When I tell folks that my field of interest is in outsourcing most people balk. They equate outsourcing with job losses in the US and just don’t want to know any more. This goes for IT folks and most other disciplines. It is with some reluctance that Purchasing and Supply management professionals have started taking interest in getting the management of outsourcing right. Because if outsourcing is done right it need not be the dreaded “O”(= Layoffs) as as an article by Steve Fox in InfoWorld/Blackenterprise.com explains. If IT folks take an active interest as outsourcing decisions are made and more importantly, implemented – it is good for all parties. Unless you are in it you cannot win it as they say …

About StratoServe.

Organizing Events for Associations

Working with practicing professionals whether in the classroom, in research and consulting or the context of professional events is really satisfying for me. I work with both ends of B-to-B in Connecticut as Chair of  University Relations for the Connecticut Association of Purchasing Management (CAPM)  and Vice President of Collegiate Relations for the American Marketing Association (AMA-CT). With the onset of Spring I find myself really busy with organizing two different events for these associations. The CAPM event for April 25, on Global Outsourcing is featured on the front page of www.stratoserve.com  and at the CAPM website and the "Careers in Marketing" event is featured on the AMA-CT website. The latter is particularly interesting as the Undergraduate Marketing Students have come together to establish connections with the marketing profession through the April 5, event at UNH.  I find working with professional associations fun work because everyone who works is a volunteer and is primarily looking at giving back to the profession- a particularly refreshing activity!

Game Development and March Madness Bracketology

The Dubai Ports  World deal is off and an American Company will be asked to manage the six ports. In the meanwhile the Gaming business is getting serious. Development of games is exciting but tedious work. 1.1B $ will be spent by the end of this year in outsourcing game development and this will rise to 2.5 B $ by 2010. This is one way that the gaming industry is able to keep up the furious development of new games.

Gaming for all generations is big and computing adds all kinds of fun to it. Consider that bracketing for the March madness is evolving to a fine art with advisers using gaming technology to provide tips on how to predict winners. "Bracketology" is becoming really involved !

Outsourcing and comedians

Comedians are having a heyday with outsourcing. Dubai Port World is the butt of jokes from both  Bill Maher and Jay Leno. Bill Maher described President Bush’s recent South Asia trip as an effort to avoid nuclear conflict in the region that could damage India as US jobs – (being done from India)- would be jeopardized!

Tonight Jon Stewart will undoubtedly have some jokes on this topic in the Oscar’s. I feel that as comedians take over a topic organizations and people become more ready to deal with a question. In this case academics like me will find more organizations now willing to talk about outsourcing and how to do it better and educational institutions trying to really address how better to train the American workforce for the 21st century. All this will happen with a smile 🙂 – I guess…

President Bush visiting India

President Bush and Mrs. Laura Bush make their way to India  tomorrow. In India President Bush will visit New Delhi and Hyderabad before going to Islamabad, Pakistan. There was a lot of media attention with a wonderful piece by Fareed Zakaria on the Newsweek cover but surprisingly this is not the top story in the US tonight on the eve of this historic trip. Instead, people are aghast at Anna Nicole Smith’s likelihood of winning millions in her inheritance battle, Iraq’s Shia-Sunni problems are front page , Google’s poor earnings are  a cause of concern as the Mardi Gras in New Orleans is a cause of both joy and hope after Katrina. Nevertheless as President Bush mentioned in a recent speech at the Asiatic Society and as Zakaria so eloquently explains -India is quite a mystery and of great hope to the world today.

With the world’s largest democracy and with large masses of people still relatively poor India is a paradox. Western students want to work in India and Indians in the West want to go back and forth. India has a Muslim President, a Sikh Prime Minister and an Italian born catholic lady who is the President of the ruling Congress party who chose not to become the Prime minister following the highest ideals of "dharma" or simply doing what she thought was the right thing to do.  The majority of the population is off course Hindu for whom McDonald avoids beef and has come up with the "Maharaja Burger". An open tolerant "raucous" society despite being a developing country- India can be largely trusted with confidential personal information – as in outsourcing of business processes. Simply a "low cost source" is not enough as majority of the world geographically and demographically is low-cost.  India’s rise says a great deal about democracy and what is possible with democracy and openness despite mind-boggling plurality. A cause for much celebration tonight…