Sunday, November 29, 2009

Dubai Burst : Is Emiratisation to blame?

The recent Dubai Debt Debacle perhaps dispelled most doubts about the globalized nature of businesses and commercial world. It started with Dubai World asking for a six month delay in paying back its debt (to the tune of billions of dollars) and sent ripples through the global financial sector. The only silver lining was that the US markets were closed on Thursday for the Thanksgiving holiday, and some bit of sanity prevailed when markets opened on Friday.

While most analysts are looking at the 'cause' and reflecting on Dubai’s hi-flying culture of developing oasis and paradises in the desert, are we missing a link here: the role of Emiratisation in the crash?

During past decades, generations of young workers from South Aisan descended in Dubai and the Gulf states, lured by easy jobs, work-visas and promise of Petro Dollars. Yes, the majority of them were from the working class – laborers, carpenters, construction workers and the like – but many were also white-collar professionals: accountants, nurses, doctors, financial analysts, businessmen, managers and Software Professionals.

Many modern societies that attract immigrants, especially white collar professionals do so with the implicit (if not explicit) intent of paving the way for permanent residency and eventual naturalization. The US has its famous H1 and Green Card program, UK has its Tier-1 and HSMP program, Canada, Australia, Singapore and even Europe have their share of (liberal) immigration programs targeting working professes. Guest Workers are attracted by the prospect of earning in Dollars, Pounds, Euros etc and also by the prospect of permanent residency and eventual Naturalization (Citizenship) in their host country. This symbiotic relationship between Guest-workers-turned-immigrants vests them into the system and adopted societies though some may occasionally think of returning back to their native lands (Reverse Migration)

The Gulf countries, Dubai included, on the other hand are perusing Emiratization, a movement by the governments to proactively employ its citizens in the public and private sectors to reduce its dependence on foreign workers. In principle, Emiratisation is not a bad idea; most nations and cultures promote opportunities for their Sons of the Soil (Ladies: I don’t intend to be sexist here). Remember the failed Immigration legislation debate in US last year when there was a proposal to legalize millions of undocumented workers? However, the restrictions on legal immigrants to western societies, especially after they land and get assimilated into the mainstream are minimal.

This is not the case with immigrants in the Gulf. Thanks to restrictions on life, liberty and pursuit of opportunities, attributable to Emiratization, many workers in Dubai and Gulf nations realize that there are few avenues to explore moving up the Maslow's hierarchy of needs

I guess the key word here is Esteem factor. When white collar immigrant workers and professionals in the Gulf interact with their cousins, friends and peers who migrated to other western nations, they realize that unlike in the west, they are unable to integrate into the mainstream of their adopted land. For instance, their kids may be able to go to good schools but will remain Indian or Pakistani. This unlike their cousins in the west who will be considered American (or Asian-American). This topic would require another blog or series of blogs, but you get the idea. Perhaps the reason scores of South Asian Immigrants migrate from Dubai to other western nations when opportunities arise (ref: recent debate in online forums on Dubai Debacle).

The point here is that unless the professionals are vested in the society, their contribution and is also going to be transient. To put it bluntly, the thinking is probably along the lines of "Why should I care about the long term interests of the business-government-society? I am just transient here in Gulf!

Cause and Effect? There are probably scores of Desis, South Asians working as advisers analysts and others in upper echelons of Dubai World and other financial institutions in the Gulf. Wonder if their ephemeral thinking of life in Dubai also permeated their decision making?

Links of interest

Sunday, November 22, 2009

Medical Tourism: The factory model of Heart Surgery

There is an article in the weekend edition of Wall Street journal that makes for an interesting read that features The Henry Ford of Heart Surgery, Devi Shetty. Tarticle touches on multiple themes:
  • Cost cutting: How Dr. Devi Shetty is cutting costs (and not quality): The process provided an example of how he slashes costs. Four years ago, the sutures would have been bought from a Johnson & Johnson subsidiary. Today they are made by a Mumbai company, Centennial Surgical Suture Ltd. . . . Four years ago, Dr. Shetty scrutinized his annual bill for sutures -- then $100,000 and rising by about 5% each year. He made the switch to cheaper sutures by Centennial, cutting his expenditures in half to $50,000. "In health care you can't do one big thing and reduce the price," Dr. Shetty says. "We have to do 1,000 small things."
  • Cost cutting without impacting quality: Dr. Shetty's success rates appear to be as good as those of many hospitals abroad. Narayana Hrudayalaya reports a 1.4% mortality rate within 30 days of coronary artery bypass graft surgery, one of the most common procedures, compared with an average of 1.9% in the U.S. in 2008, according to data gathered by the Chicago-based Society of Thoracic Surgeons.
  • Expansion of Medical Tourism: His flagship heart hospital charges $2,000, on average, for open-heart surgery, compared with hospitals in the U.S. that are paid between $20,000 and $100,000, depending on the complexity of the surgery. . . . By next year, six million Americans are expected to travel to other countries in search of affordable medical care, up from the 750,000 who did so in 2007, according to a report by Deloitte LLP. A handful of U.S. insurance plans now give people the choice to be treated in other countries.

With the healthcare debate in the U.S reaching a crescendo, one is sure to see more articles of these genera. If nothing else, it will help Americans get a better understanding of the healthcare best-practices elsewhere in the world.

Links of interest

Saturday, November 14, 2009

Some Indians Americans go Boa(t/d)ing but how many go to Udah?

The topic of accents, pronunciation and mastery of language is frequent among Indian Americans and immigrants and is a definite icebreaker; sometimes leading to passionate debates about the right or wrongs of aping accents. A hint to you: the surest way to hit an Indian immigrant below the belt? Remark about his use of English attributable to the fact he is not native born. ;-) The converse also works great: want to brownnose your Desi boss? Complement her on her clear unaccented Indian English.

A few days ago we were at a friend’s place for dinner when the topic of Indians and accents came up (surprise?), and we began sharing our anecdotes. I remarked about a colleague of ours, Raj, who seemed to have the most Americanized accent among the few Indians in the team. Ms R, a colleague from Georgia was slightly amused. She mentioned a recent conversation with Raj who had talked to her about his recent family vacation to Udah. It is only after Raj completed his story that Ms R realized that he wasn’t talking about a trip to an exotic foreign land but to the state of Utah. Turns out Raj took his lessons on pronouncing his Indian American "T" and "D"s to an extreme. Hearing this, I was reminded of Bollywood movies depicting scenes of the British Raj where the Gora Sahib would make attempts to bond with natives, speaking thoda thoda hindi in his thick British accent

What about me? Having spent years in the west – England, Europe, Canada and the US –I guess I still haven’t made a conscious attempt to acquire a native accent. I retain a typical Indian accent with what some have remarked, a tinge of the South Indian accent.

Thanks to globalization and the Business Process Outsourcing (BPO) boom, one can probably find scores of young Indians in Bangalore, Gurgaon or Hyderabad who speak much ‘better’ accented American English than most first-generation immigrants in Boston or Bay area. And between every Mohan who continues to retain a plain accent and Raj who work on his T’s and D's there are stripes in between.

A few interesting posts and blogs on the topic:

  • Can That Damn Accent!
  • The Venture Capitalist from Kanpur: Rekhi is a large and rumpled man with a heavy accent and a rapid-fire delivery. "I'm not smooth," he says, stating the obvious. The edges may be rough, but the sum is impressive
  • Are Indians the Model Immigrants? They have funny accents, occasionally dress in strange outfits, and some wear turbans and grow beards, yet Indians have been able to overcome stereotypes to become the U.S.'s most successful immigrant group

Sunday, November 8, 2009

Butterfly effect of American Healthcare Reform

The fact that American Healthcare industry is going through a massive transformation is being closely being watched by most Americans. Last night’s “historic vote” on healthcare by the US House of representatives is just one step in the transformation sweeping across healthcare. More important is the impact of this on the global healthcare industry and the butterfly effect on the global economy. Just a few interesting s snippets why the debate on healthcare is so closely watched

  • In the US alone, about 580000 establishments make up the health care industry. As per the US Bureau of labor, “As the largest industry in 2006, health care provided 14 million jobs—13.6 million jobs for wage and salary workers and about 438,000 jobs for the self-employed. . . . Health care will generate 3 million new wage and salary jobs between 2006 and 2016, more than any other industry.”
  • Implication: Healthcare reform = impact on jobs
  • Per themedica.comThe United States of America has one of the largest medical and healthcare industries in the world, followed by Switzerland and Germany. The USA's medical industry comprises of more than 750,000 physicians and 5,200 hospitals. USA witnesses approximately 3.8 million inpatient visits and 20 million outpatients visit on a daily basis. Furthermore, the United States of America has the largest workforce i.e. one in every 11 US residents employed in the health care business.
  • Implication: Healthcare reform = Large lobbying interest. Some want change that can help them, some don't want to change the status quo.
  • The sheer size of the reform is mind boggling: House health bill totals $1.2 trillion
  • Implication: Imagine the proverbial 700 pound gorilla charging ahead and you want to change course!
  • The Global prescription drug market was $550 billion in the year 2006. Also, the total health care expenditures across the world were $4.5 trillion last year. Of which, US solely account for $ 2.2 trillion, $ 2 trillion in OECD countries and remaining $ 0.3 in other countries of the world. Indian drugmakers including Dr. Reddy’s, Ranbaxy etc have made inroads into the global generic drug industry and are also watching the reform closely.
  • Implication: Healthcare reform = Impact on globalization!

I like the way BioPharma Today blogs about this "The legislation wending its way through Congress is the center of the political process, but regardless of the outcome for Obamacare 2009, change is inevitable. The scale and timing will depend heavily on the legislation—and, whatever is enacted, the implications (intended or otherwise) will take years to untangle."

As a technologist, I am fascinated by the Technology Lead changes coming down the pipe, especially the opportunities for automation, integration and system changes.

Implication: Healthcare reform (or not!) = Impact on software industry is not hard to fathom. However, seeing the forest for trees and translating them into opportunities that can impact me? I guess, there is a million dollar question hidden here.

Sunday, November 1, 2009

With Global Mobility of its people, Tata Consultancy to Expand Footprint in Emerging Markets

The recent article and interview with TCS’s new chief N. Chandrasekaranmade for interesting reading. [Software Exporter to Expand Footprint in Emerging Markets]

With revenues of $6 Billion, the largest Indian software services firm is certainly a global player. Mr. Chandrasekaran's comments to WSJ were measured, and to some extent upbeat. However, one question stood out. When asked, "What are the challenges to ramping up hiring in the U.S.?"
he replied:

"Mobility is an issue. If I hire someone in California, and the next project is in North Carolina, I can't really move them. If I send someone from India, they can go to California, and when that's done I'll send them to North Carolina. Also, we want to train people in our methodology. In India, we recruit people and train them. It isn't just about having the correct software coding skills..—I'm sure we could find enough skilled programmers in the U.S."

I addressed the same issue of mobility in my book (Offshoring IT Services) while examining the cultural aspects of Indian software developers and how their ability to be mobile made them attractive in the global marketplace. Mobility of people is a big factor in Globalization of businesses, but wasn’t the flattening of the world supposed to mitigate the need for mobility? I guess it is true to some extent. Case in point the H1-B visa quota for this year, annually capped at 65,000 is not yet exhausted even half-year after the gates were opened. During the last few years, the quota was exhausted in just a few days after the April deadline.

As they embark on expanding the footprint in global markets, I guess the question that. Chandrasekaran and team must be asking themselves: how to motivate their Indian employees to pack up and head to Timbuktu, Mongolia or Siberia when even H1 visas are going begging?