THE TANGIBLE BENEFITS OF THOUGHT LEADERSHIP
by Kishore Jethanandani
Thought leadership, trend identification, economic analysis and futurology are closely intertwined. I discovered this by accident. Back in the 1990s, I was a writer for a number of Indian business newspapers and published on themes related to economic reform, industry trends and future possibilities. I came to learn how much articulating the power of competition and market-driven policy impacts the economy for the better.
The software industry interested me a great deal as it was evolving rapidly. It also also had a sophisticated leadership well schooled in the art of influencing public opinion and policy makers. In just about a decade, beginning with its inception after the departure of IBM in the 1970s, the Indian software industry had made a mark on the world stage with its rapid growth.
In the early 1990s, it had transitioned from on-site professional services for American companies to off-shore supply of software development services. The very success of the industry became the cause of its many problems towards the end of the decade of 1990s. As the volume of data traffic grew, the need for a robust telecom infrastructure was compelling.
My articles at the time anticipated widespread relocation of services production as cheaper telecom services were made available with fiber optic networks around the world. India would be the biggest beneficiary of the emerging telecom revolution given that it had the highest population of engineers in the world who were very largely under-employed.
The antiquated telecom network in India at the time, largely in the public sector, barely covered the major metropolitan cities and it was completely inadequate for the needs of business customers. Technological advances had rendered the organizational structure of the Indian telecom industry obsolete and it was not hard to guess that it would be transformed soon and rapidly.
Futurology and thought leadership
One simple rule of futurology is to look at the opportunity costs of existing practices and compare them with the benefits of adopting the best practices. Change is rarely accepted by humans and the benefits have to far outweigh the costs before the establishment will even budge.
Thought leadership is simply articulating the opportunity costs of existing practices even if they are obvious and future possibilities based on an understanding of the benefits of transformation. Oh yes, people will find a way to spin away even the most dysfunctional practices.
I remember some nasty responses to the articles I had written criticizing the run down Indian telecom infrastructure at the time. The Chief Executive Officer of the then publicly owned VSNL instructed his public relations staff to call me at his office and he communicated his annoyance at my articles. He accused me of doing the bidding of the company’s known adversaries.
The maintenance of a public monopoly for international telecom service was then justified on the grounds that it had raised money in international markets and had based its future projections of earnings on the assumption that it would retain the monopoly for five years.
When I did some research, I found that Singapore once had a public monopoly in international telecom communications. Like in India so also in Singapore, the incumbent had also raised money in international markets with future projections based on the assumption of a monopoly for some years. Singapore’s government, however, ended the monopoly after compensating it for the lost earnings. Even after the payment of a large sum to the monopoly, the net benefit of a competitive market for international telephony exceeded the costs.
For domestic telecommunications, policymakers sought to increase access to communication services . Until the early 1990s, the wait time for receiving a plain-old telephone in a metropolitan area like New Delhi was a year or more. The lumbering post-and-telegraph department was the only source of telephone connections!!
As a first step, the Athreya Committee was appointed to suggest reforms to ease the shortages in the supply of phones. The Committee suggested that the Government Post-and-Telegraph (P&T) department be converted into a public sector corporation. However, the proposal met with fierce opposition from the Government employees of the telecommunications department.
I had the opportunity to discuss the matter with Dr. M B Athreya, a management consultant trained at Harvard Business School, who was the Chairman of the committee. An amiable man with a calm and composed demeanor, he become irritable as the employees of the P&T attacked his proposal with an absurd counterproposal of a proto-corporation, a meaningless, ill-defined idea that sounded more like a parody of Dr. Athreya’s recommendations rather than a serious alternative.
I came to the conclusion that the likelihood of a public corporation, at that stage, was not going to happen in the absence of competition from private sector companies. Dr. Athreya was insistent on the pursuit of a public sector firm. I went my way and discussed private sector alternatives with T H Chowdhary, who after retirement, worked tirelessly to bring competition into the sector.
Private companies in telecommunications
I sought to raise awareness of the emerging trends in the telecommunications industry that warranted private competition. T H Chaudhary had a great deal of knowledge due to his travels overseas including a stint at the International Telecommunications Union. He proved to be a great mentor.
As it turned out, the Indian Government did open up the telecommunications market to private companies in the mid-nineties. However, the policy and process that was put in place to encourage private companies became a huge obstacle to private investment. They were required to bid for rights to provide telecommunication services in individual provinces. The auction turned out to be a fiasco as companies outbid each other and raised the fixed costs where investment became unviable.
My view was that auctions should be for the use of the radio spectrum since it was a free good, albeit scarce, made available by nature. Pricing the spectrum made sense, otherwise its demand would exceed supply. The auctioning of the rights to provide telecom service,by contrast, made little sense because their higher price made it more difficult for competitors to enter the industry. I harped on the idea that the price of the rights to provide telecom services had to be lowered.
The final act in telecommunications
Four years after I arrived in the USA in 1998, I learned that the Indian Government used precisely the same method of compensation to end the monopoly in international telecommunications. VSNL was privatized and sold to the house of Tatas and its shareholders were compensated for the loss of their profits.
The price for the rights to provide telecom services for domestic customers was lowered. Eventually, the Government department for telecommunications was converted into a public corporation named BSNL.
From 2003 to 2008, the Indian telecommunications industry expanded exponentially increasing its coverage from 5% of the population in the early nineties to 95% by about 2010. It became the engine of the boom in the Indian economy. In more recent years, the industry has made several transitions from 3G to 4G and is preparing for 5G. No other industry in India is as dynamic.
FORESIGHT DISTINGUISHES THE THOUGHT LEADERS
By Kishore Jethanandani
Back in the 1980s and 1990s, people marveled at the entrepreneurial prowess of Steve Jobs and Bill Gates. They had become icons with ground-breaking innovations while still in their twenties. By the time Mark Zuckerberg arrived on the scene, his panache was reminiscent of Steve Jobs and Bill Gates but the impression is not as lasting. The bar for rising above the fray is much higher now.
Steve Jobs and Bill Gates captivated an entire generation, became a part of its subconscious, not only by launching new products but also by their uncanny ability to foresee and evangelize shifts in the marketplace. By sheer force of personality and intellectual gravitas, they shaped the information technology industry. Steve Jobs recognized that the GUI for personal computers a widely felt pain of tedious commands. The GUI had been around in the Xerox Lab but remained unnoticed before Jobs snapped it up for the Mac. Later, Bill Gates turned the GUI into the standard for the industry. The GUI moved out of its obscurity to become the conventional wisdom of computer design.
Dorm room innovation by twenty-something kids is a metaphor for the accessibility of technology. Lap-tops, reconfigurable software, social networking with gurus on the Internet brought the tools of innovation to the playgrounds of the young. Dorm room innovation is now getting baked into the very landscape of university campuses where incubators are springing up to seed new ventures.Innovation itself is becoming a part of the conventional wisdom.
3D printing is going a giant step further—innovation is taking place in every tinkerer’s studio apartment and not just in the student dorms on college campuses. Just about anyone with creativity can use software such as Sketchup, Autodesk 123D, Tinkercad, to design products on their desktop. An investment of as little as $1,100, “Maker Space” will enable an aspiring entrepreneur to rent space and equipment for production—an amount that could easily be raised on Kickstarter. Companies like Shapeways provide virtual shop windows for resource constrained companies to sell their products.
3D printing is an aide for major new innovations that have remained largely under the radar. Bespoke Innovations, for example, was able to design and create prosthetic legs similar to the shapes of biological legs. The breakthrough could be achieved because an Autodesk program allowed scanning of legs with point-and-shoot cameras instead of the intricacy of existing methods.
In the new age of 3D printing, entrepreneurs are jostling for attention of their customers in the gaggle of messages from their competitors. A fog of uncertainty of business prospects clouds the future of new ventures. They are often financing, designing and simulating prototypes before a tangible product is launched. The winners climb a wall of skepticism with a mix of chutzpah, vision and buzz-worthy thoughts on solutions to drive the evolution of the marketplace.
While cult-like figures like Steve Jobs and Bill Gates are likely to recede into the past, social media and the Internet, not to mention unconferences like the Marketing Camp, afford unprecedented opportunities for earning guru status and along with it fortune. Susan Boyle was unemployed, and of palpably uncouth shape, before she became a Youtube phenomenon. The one thing that was going for her was the cadence of her voice and lyrics.
Entrepreneurs can take a cue from Susan Boyle and craft messages that create waves of chirping on social media channels. Strategically speaking, a feel for the pain of customers, grasp of issues surrounding unsolved problems and foretelling the potential of emerging technologies is a sure way to get the attention of the media and customers.
Messages resonate when customers sense the excitement of new solutions for their pain. Fresh perspectives on intractable problems relieve the frustration of a logjam. Ideas on tapping the potential of new technologies raise fresh hope. Tactically, memorable language mines these seams of emotions. It crystallizes hunches, and lends logic to intuition and confidence to visions of the future.