Global CIO: Satyam Scandal Isn't The End Of Indian Outsourcing

The company's misdeeds should be a wake-up call to CIOs, but not an indictment of the Indian outsourcing industry as a whole.

By M.S. Krishnan,  InformationWeek
Jan. 13, 2009
URL: http://www.informationweek.com/story/showArticle.jhtml?articleID=212900112

The recent confession about inflated revenue, profits, and accounting fraud exceeding $1.5 billion by Satyam Computer Services chairman and CEO Mr. Ramalinga Raju has put everyone linked to the Indian software industry in total disbelief and frustration. Only a few weeks back, Satyam was considered as one of the four pillars of the success story of the Indian software industry in the global economy. Along with Infosys, Tata Consultancy Services, and Wipro, Satyam was known for its coveted Fortune 500 clients, innovative software projects, capacity to train thousands of software engineers, and best-in-class certification of software engineering practices.

The irony is that last year Satyam won the "Golden Peacock" corporate governance award from the London-based World Council for Corporate Governance (although that award was revoked late last week). It is understandable that this major accounting fraud in the background of such accolades and credence has formed a cloud of uncertainty and doubts about credibility in the entire Indian software industry. There is no doubt that the fraud committed by the management at Satyam under the certification of internationally reputed audit firms is unforgivable and has created a black mark on corporate governance in India.

In that context, the disclosure of the misdeeds at Satyam is certainly an alert call for any CIOs who have exposure to Indian software firms as partners in their global resource network. However, I believe it would be shortsighted -- and probably harmful -- to taint the entire Indian software industry based on the Satyam fiasco.

Not Every Mole Is A Cancer
We do not conclude that every big mole that bleeds is a skin cancer; obviously, we collect data and investigate further before drawing our conclusion. In a similar way, I believe for several reasons that this major failure of corporate governance at Satyam is not a structural problem with the capabilities of the Indian software industry as a whole, or with that of software talent in India. And I would thereby urge global customers engaged with outsourcers in India or elsewhere to not act too hastily based solely on the malfeasance of Satyam's founder.

First, despite the corporate governance problems at Satyam, none of their global customers had raised any concerns related to the quality of operational delivery and performance in their projects. In fact, there has been an increase in the size and scope of projects delivered to global customers by the major Indian software firms over the last few years. Hence if it had been a problem related to inability to execute large projects, we would have heard this from the market loud and clear.

Second, it may be interesting to note that of all the major software groups in India, only at Satyam had the top management shifted its attention away from its core software business in the last few years. The real-estate business controlled by Satyam owners had expanded substantially with projects worth nearly $10 billion last year. As in other developing economies, the real estate sector in India is known for structural problems related to transparency, accountability, and ownership rights. While the answers to the questions on how Mr. Raju managed this fraud and why he did it will be known only when the regulators and government complete their investigations, it is not a surprise that some media reports are claiming that the accounting fraud at Satyam may be linked to the real-estate business of its owners/promoters.

Finally, the operational implementation team at Satyam has recently won several accolades from global IT vendors such as the Pinnacle award from SAP in June 2008 for excellence in customer experience and accelerating innovation. Similarly, Satyam received two prestigious shared-services excellence awards last year from the International Quality and Productivity Council. Unlike the corporate-governance awards cited above that are based on subjective judgment, these operational delivery awards are based on actual customer experience. In addition, anyone who has visited the EMRI (Emergency Management and Research Institute) facilities in Hyderabad set up by Mr. Raju can vouch for the excellence in operational process discipline and delivery metrics followed.

These collective reasons indicate that Satyam's failure in corporate governance is not a structural issue about any significant delivery risk from Indian software houses. In saying that, I do not mean to diminish in any way the fraud committed at Satyam, or to try to portray it as any smaller sin. It is one of the biggest corporate governance scandals for India and it leaves lessons to be learned for all. It certainly calls for, at a minimum, a new layer of due diligence and checks by CIOs within their IT strategy for dealing with governance of their global resource partners. Moving Ahead
The swiftness with which the regulators have approached the Satyam case in the last few days underscores the significance attached to this far-reaching situation. It is very well known that the success of the software industry and exports in particular have been a catalyst in creating new jobs and the growth of the entire Indian economy in the last two decades. Hence, it is mandatory for the government and the regulators to maintain the transparency and swift action in the investigation of this case right through to conclusion. This is one way to instill confidence among global organizations currently outsourcing to Indian firms and among foreign investors, two groups who will be certainly be tracking the case very closely. It also is anticipated that PWC, the main auditors of Satyam, will be made answerable and possibly accountable either for negligence or collusion. We may recall that Arthur Andersen went down with Enron. Accordingly, it is expected that regulators and government will move on structural changes and in the Satyam reorganization with all appropriate haste.

In its strategy for pulling Satyam from this hole, the company's newly constituted board needs to balance carefully the interests of employees, customers, and investors. And while each of those groups' interests must be given all due consideration, the board must be sure not to short-change the Satyam employee base, a group of more than 50,000 who had absolutely no connection whatsoever to the financial scandal. The board must recognize clearly that the most important source of competence and knowledge in the software business is the people, and that for Satyam it is particularly critical to sustain current project teams so that they can avoid any major disruptions for the company's global customers.

In a historical context, Satyam follows other major cases of accounting fraud such as WorldCom, Parmalat, and Enron, indicating that this not about a specific industry or country. In the earlier cases, we did not adopt a global philosophy of questioning the performance of all telecom firms, food industry, or energy companies. While CIOs and their teams will need as noted above to re-evaluate governance policies toward outsourcing partners, we also should be very hesitant to question the validity of the entire industry because there is no evidence now telling us to do so. Indeed, what all these examples of accounting fraud have in common is that they came about for two reasons, one of which is personal -- greed -- while the other is institutional -- our capitalistic system's relentless focus on short-term quarterly financial performance.

Satyam serves in that regard as another reminder that while one can fool the system for some time, the problem will only intensify in the long term and the truth will be out eventually. This calls for more transparency in the system and processes, particularly as it relates to corporate boards. These examples expose how little boards of directors know about the actual details of their companies' operations. While no system can help guarantee integrity and values, perhaps corporate boards need to get closer to the reality of their businesses by looking at real-time system dashboards of company performance and cash balances, rather than being limited to static PowerPoint presentations decorated by management. While such steps might not eliminate such frauds, they will certainly leave an audit trail in systems and make investigations easier. It is clear that in infusing greater rigor into the systems, CIOs and IT have an important role to play in facilitating this much-needed increase in transparency and corporate governance. Should that come to pass, then perhaps Satyam's shameful experience will eventually lead to something good.

M. S. Krishnan is professor of business information technology at the Ross School of Business, University of Michigan. He also is co-director of the Center for Global Resource Leverage: India at the Ross School of Business. He is the co-author with C.K. Prahalad of The New Age Of Innovation (McGraw-Hill, 2008). He blogs about transforming business models on the New Age Of Innovation blog.

Copyright © 2007 CMP Media LLC

Print  Close Send workers home... Tejaswi Shekhawat And Virat Markandeya January 8, 2009   Mornings are particularly busy for Simone Premji, 34, Manager, HR, Tata Consultancy Services (TCS), Mumbai. It's a race against time to complete household chores, but Premji is in no hurry to leave for office—simply because she works from home. Premji joined TCS in 2002 and worked from office for three years until she had her daughter, Aliya. She initially took a year off and then wanted to get back to work. As a working mother, she was better off with a flexible working option. She got more than that; TCS gave her the option to work fulltime from home. Now her daughter goes to school, but she continues to work from home. "Something that started on a need basis has become a policy and way of working now," she says. TCS does not have a work-from-home (WFH) policy, but extends the same to employees who need it. Mumbai-based Sameer Deshmukh's daughter Richa thinks her father has probably lost his job. What else could explain his presence at home when he should be in the middle of meetings in his office? The answer to Richa's confusion lies in the 'Work from Home Pilot Programme' at IT and BPO company MphasiS where Deshmukh, 42, works as Delivery Leader of the banking vertical. Deshmukh says he can't wait for this pilot programme to become a fulltime policy. "With e-mails and phone, there are no issues of connectivity. We are in a world where face-time is not required. Everything, including appraisals, can be done on e-mails," he says. Simone Premji Manager, HR, TCS Why telecommute:"Needed to balance out work and family" Challenges: "Sometimes connectivity and a sense of dis-engagement" Premji and Deshmukh are part of a growing number of employees opting for virtual workplaces or telecommuting, with organisations increasingly putting in place fulltime work-from-home programmes. The objective is two-pronged—to retain the talent pool and cut costs. But, that's not all. Says Shanthi Naresh, Principal Consultant, Human Capital, Mercer Consulting (India): "WFH policies have a great impact on employee engagement… while many organisations explicitly position WFH practices as part of the company's total reward strategy and use it as a great attraction and retention tool, the impact of WFH practices on employee engagement is often underestimated." The trend of telecommuting may strengthen with organisations looking at reining in costs. "Today, when most organisations are trying to enforce cost-cutting measures, telecommuting is one of the most effective. From an employee's perspective, though, people may think twice. They will not want to move out of office. The employees may worry along the lines of— out of sight, out of mind," says Elango R., Chief Human Resource Officer, MphasiS. Lower cost, higher productivity While the jury is still out on the benefits of work-from-home, costcutting is clearly one of the drivers. "This policy seems to be working well for both the company and the employees. The productivity of our employees has gone up by 20 per cent," says Elango. Elango does some numbercrunching to drive home the point. "On an average, a company spends Rs 22,000 per person only on the seat cost. When he is working from home, all his needs like AC, food, transport etc., are taken care of." Elango would know because he works from home as well. "We as an organisation have to look at this as a policy and not a privilege because it probably benefits us more than the employee," he says. IT major Cognizant, too, is actively adopting WFH. It is providing the option of telecommuting to people engaged in production support activities to avoid commute at odd hours. Says T. Sridhar, Chief People Officer, Cognizant: "Our belief is that if a fifth of our employees becomes part of this new arrangement, over a period of time, we would have effected a 20 per cent saving in investments in real estate, a 20 per cent increase in productivity of our employees and a 20 per cent improvement in customer satisfaction levels when these employees remain available to them on demand." Vandana Arora Assistant Manager, Quality, Genpact Why telecommute: "I have a small kid so I opted to work from home" Challenges: "No major challenges": Genpact sees telecommuting benefits in terms of employee satisfaction and thus, retention. Says Rajeev Sharma, Vice President HR, Finance and Accounting, Genpact: "We are rapidly moving towards the world of virtual organisations. The work-from-home policy helps us in talent pool retention. Re-training cost and loss of knowledge gets taken care of." At Genpact, there is only three per cent attrition among employees working from home. Currently, the company has 500 employees working from home and it plans to increase the number to 5,000 by 2010. No weak links According to a white paper on Changing World of Work by Manpower Inc., by 2016, 63 per cent workers globally want to work flexibly and 84 per cent employers recognise this as a significant benefit in terms of retention. Vandana Arora, 30, Assistant Manager, Quality, Genpact, Gurgaon, is a recent convert to work-from-home. She has been working from home (which started on a need basis) for the past eight months. "It started because of my two-and-a-half-year-old son, but now I love it," she says. Arora is part of a five-member team and two more members of the team work from home. "It's a perfect team at work with deadlines and deliverables," she says. Are the work-from-home members of the team weak links? "I don't think so. I have even got a promotion in the past six months," she says. Companies want results. Whether you come to office every day or work from home, at the end of the day, it's the output that matters, say HR heads. "An employee's performance should be calculated on what he delivers, rather than how many hours he spends in office," says Elango. TCS sets goals for its workfrom-home employees and tracks their performance and achievements based on which their performance assessment and appraisal takes place at the end of the year. "Meeting the deliverables of the job assigned is the key measure of performance," says Ajoy Mukherjee, Vice President and Head, Global HR, TCS. Sameer Deshmukh Delivery Leader, MphasiS Why telecommute: "My company wants me to. I am liking it" Challenges: "The family needs to cooperate and be serious about the whole affair The limitations Telecommuting is not free from its share of challenges. For starters, it can only be offered to employee profiles that have no security and privacy issues involved. "If you are working on a client basis, then it is critical that your client is comfortable with your employees working form home," says Elango. Work-from-home may not work well where working together in a team and using a common pool of physical resources to deliver results is essential. Examples of this are in product engineering type functions where physical collaboration is vital for innovation. Mercer's Naresh points out: "This is, however, changing with a number of collaboration and knowledge management tools proliferating in the market." On the flip side, WFH is sometimes a challenge because of unreliable power supply, lack of private working space at home, and a constantly ringing door bell. If employees make provision to tackle these issues, then WFH is very convenient. Apart from this, there are execution challenges, too. According to Subash A.K. Rao, Director, Human Resources, Cisco India, work evaluation and absence of external motivation are two of the main challenges. Those working in teams might feel isolated and miss the interaction with co-workers. Many employees find they can get more work done without the distractions of a corporate environment, but some others find themselves unfocussed without other people around to motivate them. Cisco is implementing a work-fromhome policy on an ad-hoc basis, which is a carry-over of its worldwide policies. HR heads say that it helps to have clear rules of engagement. "Telecommuting is a good option once certain pre-requisites, like a structured performance management approach, are in place and the employee's bonus is mapped onto productivity," says Rao. Print  Close URL for this article : http://businesstoday.digitaltoday.in /content_mail.php?option=com_content&name=print&id= 9463   @ Copyright 2008 India Today Group.

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GM sues bankrupt supplier Cadence over parts

Fri Dec 26, 2008 5:42pm GMT

NEW YORK, Dec 26 (Reuters) - General Motors Corp (GM.N: Quote, Profile, Research) has filed a lawsuit against a bankrupt auto-parts supplier, saying it is holding necessary equipment "hostage" which could potentially interrupt the launch of its new Chevrolet Camaro car.

In a lawsuit filed on Wednesday in U.S. Bankruptcy Court in Delaware, General Motors asked the court to allow it access to facilities of the supplier, Cadence Innovation, so it could obtain necessary tooling and parts for its plants.

Cadence, which makes door trim, instrument panels and air bag covers, filed for bankruptcy protection in August, but this month abandoned plans to sell itself and is now liquidating, according to court papers.

GM said it needed immediate access to the tooling, because it does not have enough parts on hand, and its vehicle assembly operations could be interrupted.

"Even one day's disruption in supply of certain Component Parts could cause a shutdown of GM assembly operations, disrupting not only GM's business, but the operations of countless suppliers, dealers, customers, and other stakeholders," GM said in the complaint.

GM said that such a shut down could cost millions of dollars per plant per day and it would need to have a successor supplier in place by Jan. 12 for the launch of the new Chevrolet Camaro.

GM said it had an accommodation agreement with Cadence that requires the auto-parts supplier to continue to manufacture the parts and provide tooling and equipment.

A Cadence lawyer and spokesman were not immediately available. (Reporting by Emily Chasan and Santosh Nadgir in Bangalore; Editing by Tim Dobbyn)

© Thomson Reuters 2008. All rights reserved. Users may download and print extracts of content from this website for their own personal and non-commercial use only. Republication or redistribution of Thomson Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters. Thomson Reuters and its logo are registered trademarks or trademarks of the Thomson Reuters group of companies around the world.

Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests.

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GM shares up, GMAC may be eyeing $6 billion loans

Sat Dec 27, 2008 2:23am GMT

By Soyoung Kim and Karen Brettell

DETROIT/NEW YORK (Reuters) - Shares of General Motors Corp jumped on Friday after its auto finance affiliate GMAC won access to government lending programs, while analysts estimated GMAC might be seeking loans of more than $6 billion.

The Federal Reserve approved GMAC's status as a bank on Wednesday, giving the troubled finance company access to the Treasury-run financial bailout package, which may help GMAC avoid bankruptcy and continue financing of dealer and consumer loans for GM vehicles.

The news came less than a week after the U.S. government agreed to bail out GM and Chrysler LLC with $17.4 billion of emergency loans to provide liquidity and stave off collapse and massive job losses.

Analysts said the approval of GMAC as a bank further reduced the risk of bankruptcy for the No.1 U.S. automaker.

Underscoring the financial strains facing the U.S. auto industry, GM filed a lawsuit on Wednesday against a bankrupt auto-parts supplier, saying it is holding necessary equipment "hostage" and that could potentially interrupt the launch of its new Chevrolet Camaro car.

"It's significant in terms of GM's ability to move cars," said Erich Merkle, an analyst at Crowe Horwath.

"Things are still pretty ugly out there (in terms of sales) but in terms of GM possibly filing for bankruptcy, in my mind that's not going to happen. The reason I'm saying this is what they (the government) are doing with GMAC right now."

Shares of GM were up 13.54 percent, or 44 cents, at $3.69 on the New York Stock Exchange.

Bonds of GMAC LLC also rose, while the cost to insure GMAC's debt with credit default swaps plunged.

CreditSights said GMAC may have applied for up to $6 billion in funds from the government's $700 billion financial bailout program, and could potentially sell $17.5 billion in government-backed debt to shore up its capital position.

"While GMAC has not quantified its capital injection request from Troubled Assets Relief Program (TARP), we estimate the company could have applied for up to about $6.3 billion," CreditSights analysts Richard Hofmann and Adam Steer said in a report late on Thursday.

The analysts based their projections based on capital injections being limited to 3 percent of risk-weighed assets.

The bank status came before a debt swap deadline of 11:59 p.m. Friday. GMAC, owned by private equity firm Cerberus and GM, is looking to swap $38 billion of outstanding debt for a smaller amount of new debt, as well as preferred shares and cash, to reduce its debt load and raise capital.

"This opens the door to invest in the senior and subordinated debt," which are trading "at very attractive yields," said Andrew Brenner, an analyst at MF Global Inc in New York.

GMAC's 5.625 percent notes due in 2009 climbed to 94 cents, yielding 23 percent, versus about 73 cents on Monday, its last significant trade, when the note yielded almost 104 percent, according to MarketAxess data.

The cost to insure GMAC's debt with credit default swaps also plunged to around 24 percent the sum insured, or $2.4 million to insure $10 million for five years, plus annual payments of 5 percent. The swaps had traded at around 47 percent before the news.

GMAC TROUBLES

GMAC has struggled as the credit crunch raised its borrowing costs and the value of many of its assets plummeted.

It has lost $7.9 billion over the last five quarters and has said without bank holding company status, it would likely have to sell assets and take other extraordinary measures to make good on its obligations.

The lender's difficulties forced it to severely curtail financing for dealerships and for consumer purchases of new GM cars and trucks in recent months. The cutback in financing compounded the sales slump at GM, the No. 1 U.S. automaker, whose sales fell an eye-popping 41 percent in November.

GM Chief Executive Rick Wagoner said last week that GMAC's difficulties were "hammering" the carmaker's ability to sell vehicles.

GM dealers have depended on GMAC, North America's largest auto finance company, for financing their inventory and consumer purchases even after GM sold a 51 percent stake in GMAC to Cerberus in 2006 for $7.4 billion. GM retains the remaining 49 percent.

GM and Cerberus will have to trim their stakes to no more than 10 percent and 14.9 percent, respectively, to comply with Fed rules that are meant to prevent companies from using banks to fund their businesses.

Meanwhile, in the lawsuit filed in U.S. Bankruptcy Court in Delaware, GM sought access to facilities of parts supplier Cadence Innovation so it could obtain necessary tooling and parts for its plants.

Cadence, which makes door trim, instrument panels and air bag covers, filed for bankruptcy protection in August, but abandoned plans to sell itself and is now liquidating, according to court papers.

(Additional reporting by Walden Siew and Emily Chasan in New York, editing by Leslie Gevirtz)

© Thomson Reuters 2008. All rights reserved. Users may download and print extracts of content from this website for their own personal and non-commercial use only. Republication or redistribution of Thomson Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters. Thomson Reuters and its logo are registered trademarks or trademarks of the Thomson Reuters group of companies around the world.

Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests.

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China revises patent law to encourage innovation     BEIJING, Dec. 27 (Xinhua) -- China's top legislature on Saturday approved the revision of the Patent Law to allow inventors to apply for foreign patents before domestic ones for their inventions.     The revised law, which takes effect on Oct. 1, 2009, was adopted with 154 votes and four abstentions at the closing meeting of the sixth session of the 11th National People's Congress (NPC) Standing Committee.     The change is aimed at encouraging innovation and improving China's "international competitiveness", Chen Guangjun, a senior official with the NPC's Education, Science, Culture and Health Committee, said at a press conference after the legislative session.     Previously, the Patent Law stipulated that people, whose inventions were completed in China, must apply for domestic patents first before applying for a foreign one.     The new amendment also says Chinese inventors must first go through government scrutiny before applying for foreign patents to find out if such innovations should be made national secrets.     Inventions which have not undergone security checks will not begranted Chinese patents, according to the law.     The amendment applies to all inventions completed in China.     The Patent Law, which was enacted 1985, has had two major revisions in the past.
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Global CIO: The Top 10 CIO Issues For 2009

What should be on your agenda next year: A CIO-centric blend of business and tech issues that will help you increase business and customer value.

By Bob Evans,  InformationWeek
Dec. 30, 2008
URL: http://www.informationweek.com/story/showArticle.jhtml?articleID=212700241

Given what's going on in the economy these days, maybe the No. 1 item on this list should be "Stay employed." But we figure you've all got that one nailed, so we've focused on a CIO-oriented blend of business and technology issues that in the end represent opportunities for you and your team to drive greater business value and customer value. And, to be sure, many other issues could have made this list -- we're assuming as givens things like increase revenue, make a profit, turn out great products, etc.

Along with each of the Top 10 CIO-centric issues, we've included at least one thematic piece published in 2008 by InformationWeek that offers valuable perspectives on these top-priority subjects. Please let us know what you think at bevans@techweb.com:

1. Customer-Facing Innovation. While it's essential for CIOs and your teams to be innovating across all parts of your operation, the greatest value in 2009 will come from efforts that directly connect your brands, products, services, and capabilities with your customers. In fact, in 2009, I think we'll see this term shift from "customer-facing" to "customer-embracing" to signify the move from the largely passive approach of merely facing your customers to the more-active and -engaged notion of embracing. Two articles that offer significant insights into this concept are this blog post introducing "The New Age of Innovation" microsite we created in April with authors C.K. Prahalad and M.S. Krishnan for their superb new book of that name; and a revealing look inside one of the top consumer brands in the world via Mary Hayes' "Coca-Cola's CIO Talks Innovation".

2. Attacking The 80/20 Ratio. Just as customer-facing innovation is the top outward-facing CIO priority for 2009, the inward-looking top priority is attacking the maintenance glutton that sucks up 75% or even 80% of your precious IT budget. Unless this beast is confronted and defeated, you're going to face an ugly 2009 with little or no money available for innovation, and that inability to push the company forward will, sadly, enhance the stereotype of you and your team as a cost center that impedes progress rather than accelerating it. In that context, we're happy to provide a richly detailed account for how to make it happen with Chris Murphy's superb "HP Goes All In With IT Transformation".

3. The Challenging Economy. Making your already-difficult job even a little more demanding, the current global economic mess is forcing CIOs to find ways to pursue the top two agenda items while also slashing away at costs. To see how some of your peers are tackling those challenges, check out another great piece by Chris Murphy called "How CIOs Are Setting IT Strategy Amid Economic Uncertainty".

4. The Strategic CIO. And somehow in 2009, even as you're dealing with those three issues above, you'll have to make some time to continue finding additional ways to enhance your role as a strategic business leader within your organization. While that certainly implies an open-ended set of possibilities, here are a couple of pieces that will offer some ideas of what you should be doing, "Tomorrow's CIO: The Qualifications," and what you should definitely not be doing, "Two Flavors of CIO, Each Leaving An Aftertaste".

5. Cloud Computing. Is it safe? Is it practical? Is it The End Of IT? Is it right for you and your company? InformationWeek's John Foley, who recently launched an excellent new site called Plug Into The Cloud, offers some CIO perspectives in his insightful overview, "CIOs On Cloud Computing".

6. The SaaS Effect. In 2008, like cloud computing, SaaS went from a slightly marginal prospect into a full-fledged player as large, midsize, and small companies alike began adopting the notion of having someone else host mission-critical applications. One of the challenges CIOs faced and will continue to face with the SaaS model is integration, and Mary Hayes offers an outstanding look at the challenges and solutions in "SaaS Integration: Real-World Problems, And How CIOs Are Solving Them".

7. Virtualization. While this became one of the most widely pursued approaches to attacking the 80/20 problem, some CIOs did not or could not make a strong case to the CEO and other executives about the business value virtualization can offer. So in some cases it was seen as a cool back-office techy thing, but not something to be confused with a game-changing business tool. Art Wittmann offers some analysis on this must-solve 2009 problem with "Does Management Get Virtualization?".

8. Outsourcing. Although it's widely used and most CIOs feel it can offer huge value, outsourcing is still regarded by some as anywhere from too risky to too mean-spirited. Chris Murphy shines some clear thinking on the whole matter as part of his two-week adventure in India with "Report From India: 5 Reasons To Outsource".

9. Green Computing. While a lot of attention around this issue was centered on the dubious claims of saving the planet, many companies devised excellent approaches to lowering energy consumption, reducing costs, and doing a better job with recycling -- all good business practices. In the midyear days of $4 gallons of gasoline, John Soat fingered the real culprit with "Energy Woes? Blame The CIO!".

10. Radical Desktops. Here's how Joe Hernick opens his analysis of how the trusty old desktop computer is about to undergo some massive change: "A slate of contentious issues -- social, economic, and technological -- will radically alter the business user's computing experience by the end of this decade." Virtualization, smartphones, new platforms, and more all play a role in "Radical Desktops Deliver Power To The People. But What About IT?".

So that's our list of things to keep you CIOs busy in 2009. If it's any solace, we here at Global CIO are honored to be able to follow your efforts and challenges and achievements, and to share the perspectives we hear from you and your peers as you attempt to change how the world thinks, works, plays, learns, communicates, and views itself. Thanks for the opportunity to serve you, thanks for your trust, and thanks for the great work you do. May 2009 be full of promise, fulfillment, and fun. Happy New Year!

To find out more about Bob Evans, please visit his page.

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IT cos eye Japanese outsourcing biz 30 Dec 2008, 0153 hrs IST, Aparna Ramalingam, TNN CHENNAI: After neutralising their mother-tongue accent and mastering the American drawl, Indian geeks are busy learning Japan's Kanji, Katakana and Hiragana symbols. Reason: The recession is eating into the volume of outsourced IT work from the US; and after the US, Japan is an important market from the IT perspective, more so during the current period. Take the case of Suman Reddy Ragidi, a business analyst of Cognizant. Japanese language training has enabled her to converse with clients both in formal as well as informal situations. "The training has also made it easier for me to understand all project documentation written in Japanese," says Reddy Ragidi. On its part, Cognizant runs foreign language training in its offices and its mandatory for employees to enrol in such language courses. "Language is an important aspect of culture and such training is helpful in everyday communication. Importantly, employees are able to articulate their viewpoints to clients," says K Venkataraman, director of Cognizant. The Japanese IT services market is valued at $108 billion, according to a recent survey by Nasscom and PricewaterhouseCoopers. India has bagged only 13% of this offshoring pie. Moreover, demand for software is primarily driven by the BFSI (banking, financial, services and insurance) and manufacturing companies which consume 42% of the total IT services. Another Chennai-based IT player Infoview Technologies, whose business comes fully from Japanese majors, is making sure its employees know Japanese symbols by heart. Around three-fourth of the company's employees have learnt the language and the top management team which accounts for 10% of the workforce has reached the 'near native level' in terms of mastering the language. The company also recently launched an online Japanese learning software for beginners in India. JWEIC is developed by WEIC Corporation, a Japanese company that is into production and sales of e-learning language and learning management systems. Infoview, which has the rights to sell the software in India and Singapore, is targeting executives and college students alike for the online course. It is targeting 10,000 learners during the first year. Similarly, Noida-based Nucleus Software which generates half of its revenues from Japan is encouraging its employees to learn the language. "Right now, we are utilising the services of interpreters and translators," says chief executive and managing director, Vishnu Dusad. For Indian IT entrepreneurs like Chandrasekaran of Infoview Technologies and Dusad of Nucleus the lure for doing business with 'The Land of the Rising Sun' is the importance that the Japanese place to long-term relationships. "It's tough to crack the market initially. On an average, while it takes three months to close a deal with an American firm, it's double for Japanese companies," says Cheran Chandrasekaran, CEO, Infoview Technologies. Adds Dusad, "The main challenge is the language. But once you meet up to their expectations, you can be assured of a fairly long-term relationship with the Japanese." These businessman are now ensuring that their employees learn the language and don't say 'sayanora' soon. aparna.ramalingam@timesgroup.com

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