Monday, August 04, 2008

vivek wadhwa: Is innovative workplace training fueling an Indian economic miracle?

aug 4th, 2008

from ram narayan. and he asked vivek an india v china question, see at the end.

in my personal opinion, this is too complacent and facile. the government's extremely negative role in education is going to haunt india, as the breakdown in the education sector in the US is beginning to hurt the US too.

the indian government did two things wrong (well, many, but i will just look at two):

1. focused on tertiary education rather than primary
2. even the tertiary centers of excellence are used as pork-barrel entities to hand out government goodies to their chosen ones

this has led to the demise of indian education, certainly in the pure sciences and the social sciences. india does better at technical education -- IITs, IIMs, AIIMS -- only because the best students have traditionally gravitated to them. the IITs and IIMs produce good students not *because* of what is taught there, but *in spite* of. all kudos to the JEE and the CAT, and the sense of self-confidence taught to the students at the IITs and the IIMs. (i imagine it is the same at the AIIMS).

given all this, i am a little skeptical that companies are able to reverse 12 years of crummy eduation through 3 months of 'finishing school'. i don't think this is the answer. a more plausible answer is that the average student coming out of even the average engineering schools in india is pretty smart and numerate; if the (clueless and not-educated-in-managing-people) middle-managers don't screw them up too badly, the incoming engineer does fairly well. also, most of the things that are being done in indian industry are not earth-shaking. although i must admit i am a fan of the idea of 'frugal engineering' that indian engineers seem to be pretty good at.

---------- Forwarded message ----------
From: Ram

Is innovative workplace training fueling an Indian economic miracle? What the US can learn from India -- A Note from Vivek Wadhwa.

Ram, many have been predicting the demise of Indian industry. They say that rising salaries, poor infrastructure, a weak education, etc. will cause Indian industry to implode….that the Indian IT industry was just a flash in the pan.

Yet my research at Duke and Harvard has shown the opposite -- that despite all the obstacles, India is rapidly becoming a global R&D hub. I used to be a tech CEO, and was one of the first to outsource R&D to India. What I saw the Indian IT industry achieve in 15 years is happening in half the time in an assortment of industries -- Its scientists are doing sophisticated drug discovery for Big Pharma, its engineers are designing key components of jetliners for Boeing and Airbus, helping to design automobile bodies, dashboards, and power trains for Detroit vehicle manufacturers, and are developing next-generation networking solutions for companies like Cisco. Indian companies are also developing innovative solutions for the Indian marketplace, such as the $2500 car produced by Tata.

My own research has shown that India is in poor shape with its higher education – the country graduates less than 1000 PhD's in engineering – which is not even enough to staff the growing universities, let alone build an R&D machine. So how is India doing all this?

Duke/Harvard and the Kauffman Foundation published a detailed report, which I authored, called "How the Disciple became the Guru: Is it time for the U.S. to learn workforce development from former disciple India." It shows how India's companies learned the best practices of Western companies and perfected these. Indian industry has developed a surrogate education system which can take workers with weak education and turn these into world class R&D specialists. Here is a link to download this http://papers.ssrn.com:80/sol3/papers.cfm?abstract_id=1170049  (select the download location at the top of the page).

Below are 2 articles which I authored for BusinessWeek and the Wall Street Journal on this. Harvard International Review also published an abstract and will spotlight this in the next edition of their journal.

Bottom line: Just as the Japanese achieved major advances in manufacturing management in the 70's, which led to their rise as an economic power, India is achieving similar feats in workforce development: India has learned and perfected the best practices of leading companies that have been outsourcing their computer systems and call centers. We believe that this will fuel the Indian economic miracle. And we believe that the best way for America to respond to globalization isn't to construct trade or immigration barriers: it needs to re-learn some lessons in workforce development from its former disciple, India.

Regards,

Vivek Wadhwa
Duke University, Pratt School of Engineering
Harvard University, Labor and Worklife Program, Harvard Law School



http://www.businessweek.com/technology/content/jul2008/tc20080722_958899.htm?chan=search  

BUSINESSWEEK

Viewpoint July 23, 2008

What the U.S. Can Learn from Indian R&D 

Engineering companies in India play a leading role in educating their research employees, a practice the U.S. can adopt to help keep its global competitive edge 


http://online.wsj.com:80/article/SB121675006375274155.html 
 
THE WALL STREET JOURNAL ONLINE , JULY 23, 2008

India's Workforce Revolution 

By VIVEK WADHWA




_____________________________________________


I asked Vivek: Where does India stand vis-a-vis China with reference to his research?

Vivek's answer:

In China the only significant R&D is being performed by MNC's and that is targeted at the Chinese market. In India, MNC's are doing a lot of advanced research for global markets, but they are greatly overshadowed by Indian companies doing research for the global and Indian market. China today excels at imitation -- not innovation.

China increased engineering bachelors graduation rates by a factor of 4, its masters and PhD's by a factor of 6 to 7 over a decade. It now publishes 4 times as many academic papers. And it is investing massively in research. One can only marvel at the magnificent infrastructure and gleaming cities of China. In India, the government is focused mainly on playing vote bank politics with its higher education system – setting 52% university admission quotas for groups in which the vast majority does not even complete high school. India still only graduates less than a thousand PhD's in engineering – not even enough to staff its educational institutes. The country looks like it is falling apart.

Yet India is leapfrogging China in R&D. In China, the vast majority of R&D is being performed by MNC's to adapt their products for the Chinese market. This is usually managed by expats and returnees. There are a few exceptions, but by and large, China is excelling at imitation, not innovation. Now, go inside the labs of hundreds of companies in several industries in India, and you'll be amazed. There are literally hundreds-of-thousands of engineers developing advanced technologies for global markets. (Now they are developing innovative products for their own markets also).

If K-12 education, investment in research and S&E graduation could make all the difference by themselves as is the mantra in the U.S., then India should be imploding and China should be the world's new innovation hub. This story from the Washington Post shows some of the issues in China -- A Long Wait at the Gate to Greatness (http://www.washingtonpost.com/wp-dyn/content/article/2008/07/25/AR2008072502255.html?wpisrc=newsletter). But China faces even greater challenges in laying the seeds for innovation and entrepreneurship. It takes much more than people who want to make money…you have to build the culture and systems for entrepreneurship…and you need to enforce IP laws.

Bottom line: China's growth is government-led. India's growth is entrepreneur-led. Education is an enabler. Not having this ensures failure. But more education doesn't ensure success. The U.S. needs to bring education to those that are left behind (which is a horrifyingly high number for an advanced country). And the U.S. needs to focus on improving the skills of its existing workforce. If it waits for its next generation to make it more competitive, it will be too late. Indian industry isn't relying on its education system or government – it has learned the best practices in workforce development from the west and put these together to form a whole which is giving the country a badly needed edge.

3 comments:

gopinath said...

Apart from learning from the best practices of the outsourced customers, there is one other big potential I have been encouraging my offshore partners to pickup is the large Indian community which manages such outsourcing. We all have the goodness of India in our hearts, and I have conducted many training sessions, discussions with all levels of the management of such companies to develop a positive attitude among the employees (removing the "Chalta Hai" attitude) and assume responsibility and accountability.
Leadership training is another huge potential to be tapped, as most of our engineers gain tech experience and are ready to mold into next generation leaders.

truti said...

Rajeev,
I am impressed with Vivek Wadhwa's findings, because it is the first time an expert from outside India has managed to understand the way talent mgmt. works in India. I set up and ran the HR function for an FMCG business in India >10 years back, and second his findings. I have worked now in the US for over 8 years and am sad about the pitiable state of the HR function. HR in India is an activist function and a critical enabler in talent sourcing, and management. In the US the HR dept. is simply a clerical dept that adds little or no value to any stage of the process. There is such an obsession with specialisation and relevant experience that selection is almost robotic. Performance Mgmt is a farce. Grooming for higher management is done more seriously but schmoozing plays a v.big role in the process. Training is entirely for skills and zero for attitudes and team work. The sort of intense experiential training I have conducted in India, although inspired by US practices and movements of the 1950s is v.effective and leads to lasting change. In the US I find experiential learning if done at all is piss poor, lousy untrained facilitators, no sense for group dynamics, and full of it themselves. Till around 10 years ago it was the norm for the foreign collaborator (especially a US based firm) to send a fairly junior functionary - a rookie - to "liaise" actually supervise its Indian operations. I have witnessed such terrible instances where a rookie MBA or scientist would lord over his vastly more experienced Indian counterparts. Those days are now changed and gone for good. Today you have 30-something India based Indian managers flying around Europe and the US swinging ever larger deals with Fortune 500 companies. The typical large US/Europe/Japanese corporation is fast becoming dead meat. Momentum can take you only so far.

It is a good thing that corporate India is growing its own talent. But this may do only for our single digit growth rate. If we want to grow at 15-2-% a year, revamping K-12 education is a must, without which we will never hit the high notes.

truti said...

I spent some time reading the report last night. Though not a "paper" quality document it contains a catalogue of details. There is no theory yet though, but plenty to develop one. Wadhwa and his tam are not very well grounded in business history and parrot the often touted Japanese "adoption" of supposedly US style quality management systems, developed - unsaid of course - he thinks by Deming. But those who have done substantial work in the area of quality management would know that Deming was at his best a mere applied statistician with very little grounding in theory. It is Juran who is hte real manufacturing Guru of the US. The Japanese mode of quality management took off from the work of Juran and was later developed by several gurus notably Taguchi. Somewhere along the way Silicon Valley decided to adopt QM seriously but Detroit and the Rust Belt simply logged out of it. The Sun Belt defence sector installed an expensive inspection led system which with unlimited budgets delivered high quality stuff. So it is not correct to say that Japanese simply adopted US best practices. Similarly in India progressive people management practices can be traced all the way back to the seminal study done by the engineer's engineer of the 20th century - Sir M Vishwesharaya - who was invited by Tata Steel in the inter-War years to study the organization and its methods. I have leafed through this report at the Tata Steel Archives and Museum in Jamshedpur and sadly few, even in Jamshedpur, are aware of this path-breaking work. Later inspired by the humanistic psychology movement in the US, Tavistock in hte UK, Kurt Lewin and Edgar Schein's work at MIT and the emergence of the T-group, Indian HR professionals developed an early interest in the movement in the late 1950s. As the public sector, Tatas, and a few other private industrial groups expanded during the 1960s, pioneers such as Dharni Sinha, Nitish De, and others founded the Indian Society for Applied Behavioural Science in 1972, exactly 25 years after the founding of the National Training Labs (now NTL Inst. for App. Beh. Sc.) in the US. Indian HR practitioners have developed their art and craft over many years as working with people was one thing the government never could regulate. When the services began to grow explosively in 2000, Indian HR practitioners found the opportunity to apply their learning to v.large scale systems. Some of the things Wadhwa talks about - for instance Management Devlpmt. - is decades old. I have instituted such a system >10 years back with very objectively defined career charts. Zahid Gangjee developed what is the best such managemetn development program during his days at ITC. In the US barring GE, Xerox, HP, and to a lesser extent IBM systems of such sophistication are unheard of. I am surprised Org. Behaviour theorists in the US - including who I consider the leading practitioner of the field Hayagreeva 'Huggy' Rao (AU Waltair, XLRI, PhD Case Western - now prof at Stanford GSB) have not published in this field. Fascinating stuff.