Bangalore lessons: Tips to mine outsourcing gold rush

People are starting to say that if you stay in Bangalore, India long enough, you?ll meet everyone you know. During the two years I?ve worked here, so many American business leaders have visited you?d think there was a gold rush.

The Indians have a procedure to introduce the gold seekers to the treasures of Bangalore. Limos meet them at the airport and take them to a five-star hotel. The next morning limos ferry them to a high-tech park where they talk to a brilliant Indian entrepreneur. They emerge from the meeting and announce they?re opening a new 5,000-seat call center or a research center employing 500. Limos take them to the airport, and they fly away.

There is treasure here. The image of a gold rush is apt, but imagine what happened in a mining town in the 1800s when news spread about the riches. Thousands of miners rushed in, built shacks, threw their garbage in the streets and polluted the environment. A few miners found treasure and got rich, but most did not.

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Bangalore used to be called the Garden City, but today it?s like a mining town before its demise. It has grown so fast that the infrastructure is near collapse. Two years ago I could commute from downtown where I live to the high-tech park in Whitefield in 30 minutes; yesterday it took more than one hour.

Streets are filled with potholes, sidewalks torn up, and piles of trash are everywhere. There are blackouts or brownouts every day. Politicians are incompetent and corrupt. The police are a joke. The Times of India sent a team of reporters to several police stations last week to try and report a pickpocket. No station would take a report.

Some people are waking up to the disaster. Azim Primje, the head of Wipro Ltd., India?s third-largest software exporter, and the third richest man in the world, announced recently that the infrastructure in Bangalore is so bad his company will not expand here.

Gartner, a research company that analyzes the business process and outsourcing /information technology industry, estimates about 50 percent of the projects here fail. There is treasure in Bangalore and other locations in India, but Americans have to learn how to be better miners.
Here are 10 suggestions to help you find treasure:

1. Americans never stay long enough. If your company is going to succeed here, you need to learn how the culture functions. Keep your agenda open, because you may find treasure in unexpected places.

2. Americans never talk to enough people in an Indian company. Top leaders are brilliant, but middle management is often weak or even incompetent.

3. Most Indian companies are family owned or dominated by employees of a single caste. Parsees control Tata, and Marwaris control Birla. This can cause immense problems. The fight between the brothers who control Reliance Industries is the most recent example.

4. On the surface India companies will project an image of being a happy family, but scratch the surface and you will find squabbles that eat up a lot of time.

5. The presentations you see will be slick. They will assure you that they understand American business methods, that they have a low attrition rate and that their employees ?will go the extra mile for you.? (I?ve heard that phrase so many times I think they must learn it in English One, Lesson One.)

The truth is that the top boss may know American business practices, but no one else will. Their attrition rate is always much higher than they admit, probably 45-70 percent. It is true employees will go the extra mile for you, but there?s a catch. If they have 5,280 employees and each one goes an extra foot for you, that?s a mile. But think of the management effort that is required to produce that extra mile.

6. Estimate how long you think a project will take and add four months.
7. On your calculator add 5,000 plus 2,000 plus 500 about 90 times and think about the candidate pool in Bangalore. Companies are hiring kids who have not graduated from high school as well as older people who have been out of the work force. Now think about quality and the upward pressure on wages. An executive told me that some of her employees are demanding 30 percent increases.

8. If you believe that you could be trained to be an opera singer in a month, then you also may believe the accent of an educated Indian can be neutralized in a month. It takes eight weeks at least.

9. Lack of teamwork is one of the major faults of Indian businesses.

10. Indians can?t say ?No.? If you ask them if they can work Saturday, and they reply, ?I will try my best, sir,? that means no. Americans always leave Bangalore thinking Indians have said yes to their every request when in reality the answer was a loud no. In this same vein, Indians will withhold bad news from you.

Larry Caldwell, a former Boulder resident, is director of GeoAgenda.com LLC, a consulting firm that helps American companies and employees prepare for projects in India. The Web site is at www.geoagenda.com. E-mail is lgc@indra.com. His telephone in India is 091 98806 58494.