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Archive for September, 2007
In his book Games Indians Play: Why We Are the Way We Are, V. Raghunathan writes about a farmer whose corn won top awards year after year. When a reporter asked about the secret of his success, the farmer attributed it to the fact that he shared his corn with his neighbors. Why, the reporter wondered, would the farmer want to share his seed when those neighbors also competed with him for the prize? The farmer’s reply was, “The wind picks up pollen from the ripening corn and swirls it from field to field. If my neighbors grew inferior corn, cross-pollination would steadily degrade the quality of my corn. If I am to grow good corn, I must help my neighbors do the same.”
That Indians often fail to act like this farmer is the principal theme of Raghunathan’s book. Using examples as varied as their tendency to drive through red lights to their failure to protect the environment, Raghunathan argues that Indians often act in ways that focus on winning immediate gains at the expense of long-term benefits. What makes Raghunathan’s approach unusual is that his argument isn’t a moral diatribe: He employs game theory — a branch of mathematics — and related concepts, such as the prisoner’s dilemma, to present his case.
India Knowledge@Wharton: Your book is titled, Games Indians Play: Why We Are the Way We Are. What are Indians like?
Raghunathan: In the first chapter of my book, I describe what I believe Indians are like by offering 12 canons of “Indian-ness.” For example, one of our traits is “low trustworthiness.” By that I mean we are most likely not to cooperate in a prisoner’s dilemma kind of situation. Privately, Indians are reasonably smart — in fact, we are as smart as anybody else — but publicly we are dumb. Our ability to understand the need for cooperation is very low. We believe that cooperation and selfishness cannot go together — which is not true. We also tend to be very fatalistic in our outlook. We give excuses such as, “What can I do alone? Everybody else is looking out for himself, so why shouldn’t I?”
India Knowledge@Wharton: What exactly is the prisoner’s dilemma, which you just mentioned? How do you use it to explain the behavior of Indian business people?
Raghunathan: The prisoner’s dilemma, which was first developed by researchers at the Rand Corporation during the 1950s, is a concept that has come to occupy a prominent place in game theory. The problem statement goes like this: Assume that you and I are co-conspirators in a crime. Each of us is selfish and coldly rational. We are being interrogated in two separate cells, and we are unable to communicate with each other. The interrogator tells you that he has enough evidence to put each of us away in the slammer for two years each. However, if you squeal on me and help him prosecute me, he will set you free immediately and imprison me for five years. He also tells you that he will make an identical offer to me (though you and I cannot communicate). If each of us betrays the other, he will put us both away for four years. Being selfish and rational, we have to respond to the offer in terms of what is in our best self-interest.
Now, here is our dilemma: Should we defect and squeal against each other, or should we cooperate and hold out against the interrogator? You may reason that if I defect, it would be in your interest to defect as well — otherwise you will be stuck in prison for five years while I go free. And if I do not defect, it is still in your interest to defect, since you will walk free immediately. So you decide to defect. I follow the same reasoning, and I defect as well. As a result, each of us ends up with four years in prison. If we were to cooperate, though, each of us would be better off because the interrogator has evidence to put each of us away for just two years. But for us to end up with that outcome, we need to recognize that the two-year punishment we will have to accept for cooperating is better for each of us than the four-year punishment we would get for defecting and ratting out each other.
Our situation is such that we believe that if we do not cooperate, we benefit more. We put ourselves in the other person’s situation: We ask, if he does not cooperate, why should I? If he cooperates, it may still be in my interest not to cooperate, because I benefit by not cooperating.
Although this may sound abstract and theoretical, this is often how Indian business people tend to think. Very often our exporters show samples that are of a high quality, but when the time comes to ship the goods, they send something inferior. This is very much like a prisoner’s dilemma situation. You may initially make money because you have gotten something for nothing, but going forward — in an iterative kind of a context — you will most probably fail. You will stop getting export orders when your customers figure out that they cannot depend on your quality. They will stop trusting you and start suspecting you. In my book, I cite the example of some Indian companies that had won orders to export powdered red peppers (or chillies) to Korea. Apparently, when the goods arrived, the Koreans discovered that the very first consignment was adulterated with red brick powder. The Koreans emptied the whole consignment in the high seas, vowing never to import this product from India. I read a similar report as recently as last year.
The prisoner’s dilemma also explains why Indian companies often fail in joint ventures. We tend to be over-argumentative and often look out for our own narrow advantage rather than trying to make the venture succeed. If you look at the way we behave in all kinds of situations — whether it involves jumping a red light or dumping our garbage in the streets — that kind of behavior can be explained by the prisoner’s dilemma. I will keep my own house clean, but the streets are not my business. Since everybody thinks the same way, the public interest suffers.
Please Read the Rest of the Conversation Here. Its Interesting.
Every new technological, mechanical or intellectual breakthrough has its day, days, months and years. But they don’t rule forever. That’s the reality.
Every generation has its defining breakthrough. Cars, TV, Radio, Planes,highways, the wheel, the printing press, the list goes on forever. I’m sure in each generation to whom the invention was a breakthrough it may have been heretical to consider those inventions “dead and boring”. The reality is that at some point they stop changing. They stop evolving. They become utilities or utilitarian and are taken for granted.
Some of you may not want to admit it, but that’s exactly what the net has become. A utility. It has stopped evolving. Your Internet experience today is not much different than it was 5 years ago.
That’s not to say the impact of the Internet on the entire planet hasn’t been off the charts. It has been. It has changed the lives of billions of people and it will continue to be a utility to billions of people. Just like cars, TVs, Radio, Planes, Highways, you get the point.
Some people have tried to make the point that Web 2.0 is proof that the Internet is evolving. Actually it is the exact opposite. Web 2.0 is proof that the Internet has stopped evolving and stabilized as a platform. Its very very difficult to develop applications on a platform that is ever changing. Things stop working in that environment. Internet 1.0 wasn’t the most stable development environment. To days Internet is stable specifically because its now boring.(easy to avoid browser and script differences excluded)
Applications like Myspace, Facebook, Youtube, etc were able to explode in popularity because they worked. No one had to worry about their ISP making a change and things not working. The days of walled gardens like AOL, Prodigy and others were gone. The days of always on connections were not only upon us, but in sufficient numbers at home, work and school, that the applications ran fast enough to hold our interest and compel us to participate. In other words, the Internet stabilized. Great software was developed to run on the software.
Just as a reminder to some, Myspace, Facebook, Youtube, etc are not “the Internet”. They are software applications that run on the Internet. Just like MicroSoft Excel is a software application that runs on MicroSoft and Apple operating systems.
The days of the Internet creating explosively exciting ideas are dead. They are dead until bandwidth throughput to the home reaches far higher numbers than the vast majority of broadband users get today. Read More
42 teams with three students each from Mount Carmel College took this game from theory to practice. Each team got fifty rupees and had to come up a business idea, start and run the business and earn profit – all in three days! Initial apprehension turned into wild enthusiasm as finalist teams made a profit of over Rs. 2000 and the winners raked up profits over Rs. 3000.
The students have a lot to say about the experience of working something out on their own. “We were not the entrepreneurial types. And we just thought that we will give it a go as it’s our final year. But when we started doing things, we found it was a lot of work,” says Sneha Joseph, student of TY BCom. Sneha’s team baked cakes and sold them to the students in college. And when the cakes were over, they made hot chocolate fudge with left over cocoa and sold it. ‘Diversify the product line’ may be unfamiliar jargon to them but that is what they did. Their profit was Rs. 1800.
Sri Vidya, another TY BCom student and her team were dealing in clothes. “We knew a dealer who buys his stuff from Tirupur. We bought two T-shirts from him at Rs. 25 each and sold it for Rs. 250 and Rs. 300,” she says. “We sold two and with the money we earned, bought more shirts to sell.” Vidya’s team certainly picked up the art of rolling back profits into the business. They had a profit of Rs. 1675.
Kannika Bharath Iyengar, SY BA student and her team were winners with a profit of Rs. 3186 and they also baked and sold cakes. According to Vasanti Venugopal, the NEN Faculty Coordinator and member of EEC, these students had an edge over their competitors. Pricing. “They realized that low price was easy to sell. So they kept small slices at Rs. 5 each while others gave big slices at Rs. 15,” she explains.
But Kannika had an additional take. “We made proper cakes with wonderful icing and sold them at Rs. 250. This was fast money,” she says. They quickly learnt the tricks to make a quick buck.
Vidya’s team focused on customer satisfaction. “We realized that when we sold T-shirtswith prints and logos of some well known brands, people were willing to pay up to Rs. 300 for this. So we decided to cash in on this.” Listening to the customer needs certainly worked for them. source
The fastest supercomputer. The most intriguing data center. The constantly changing core[kernel] at the heart of Linux. The Google Data Center. Take a tour of the most impressive and most unusual marvels of the IT world:
World’s Most Intriguing Data Center: Google
Location: The Dalles, Oregon, on the banks of the Columbia River, 80 miles east of Portland.
Main attractions: Hydroelectric dam for power, two four-story cooling towers.
B.G. (Before Google): Pioneers knew The Dalles as the end of the Oregon trail.
Jobs inside the data center to date: Between 100 and 200. Google won’t specify.
Code name: Called Project 02 by the locals.
Wired by: A fiber optic artery looped through the surrounding wilderness.
Secrecy level: High. Two reporters from the local newspaper are the only media who’ve been inside the compound and written about it (See “Inside the World of Google”): Google treats any and all details as though they belong to the National Security Agency.
Size: 30-acre site.
Number of servers: Google’s mum. It has an estimated 500,000 around the world, spread across 25 locations.
Storage: Across all its data centers, Google stores an estimated 200 petabytes.
Top searches inside the compound: We’d bet it’s a tie between “Britney Spears” and “Web 2.0.”
Biggest Paradigm Change in Enterprise Software: Linux kernel
Created by: Linus Torvalds, in 1991, helping open-source developers collectively craft a viable alternative to Microsoft operating systems.
Number of developers: Total since 1991 is unknown; 3,200 developers for the kernel as of release 2.6.22.
New releases: Every 2.6 months.*
Quick change artists: 2.89 changes made to the kernel every hour.
Lines of code: 8.2 million and growing (about 10 percent per year).
Amount of code added every hour: 85.63 lines.
Revenue diverted from Microsoft: Perhaps only Mr. Gates knows.
*Unless otherwise marked, statistics reflect Linux kernel releases of the past 2.5 years (version 2.6.11 through 2.6.21).
TiE Bangalore organized an event on Scaling Startup. The Panelists analyzed the lifecycle of the start-up and the challenges faced by the start-up entity. The speakers shared, among other things, the importance of vision; the need for companies to think big but focus on execution; by doing it right; the importance of the entrepreneur (s) focusing on building the right management team from the beginning; the need for start-up companies to proactively ‘think all’ and ‘act on’ the important aspects of funding such a build up of scale.
Following keys where presented by Shalini of Footprint Ventures (a VC Fund) on the requirements for a company to be funded by Venture Capitalists:
1. Team - the team has to have good knowledge and be passionate about the product/service/idea they are looking for funding. Also they should have very good understanding among themselves and also have a good rapport with the VC. Without this they will definitely not get funded.
2. Idea - the team should fully believe in their idea and not come up with a half baked idea just for the sake getting VC funding.
3. Investment requirement – the team should know exactly how much they require and not come up with some figure like say 4 million dollars because somebody thought it is a good figure.
4. Scale - the idea should be scalable.
Rajiv C. Mody is the founder, Chairman and CEO of Sasken Communication Technologies Limited. Under his able leadership, Sasken has grown into a major technology and solution provider to worldwide customers in the area of Telecom Access Market, making Sasken a pioneer in telecom R&D outsourcing. Main takeaways from his talk :
|The entrepreneur has to realize that excellence and executionis the underlying foundation for any start-up.|
1. One should have the vision to see where you will be one year down the line, after 2 years, after 3 years, etc. and morph yourself accordingly. One should be able to articulate your vision clearly. One should be prepared for technological challenges. Sasken had developed a software modem which they could not launch because of the cost of the patents involved.
The management team should have the right values. Sasken used to give a lot of different allowances like book allowance, furniture allowance etc. so that the employees could avoid tax but they felt they were not doing the right thing so did away with all the allowances and now pay only a gross salary and pay the full taxes to the government.
-One should select the right person for the right job, while one is scaling up.
-One should always aim high
What i will tell every entrepreneur is – do your homework. In a mature market quick and dirty will not work whereas if it is a new idea – proof of concept can be tried first to see if it will work. Read More
Former Apple Marketing Executive Steve Chazin has released an ebook called Marketing Apple, which concisely describes how companies can market the way Apple does.
The ebook covers five secrets to Apple’s success, spanning the company’s ability to harvest an in-crowd (“the iPod generation”); early adopters, such as iPhone users; and fringe users who do not want to be associated with either group but consume Apple products anyway.
Marketing Apple is available as a free download (pdf).
Google (GOOG) has begun making VC-style investments to the tune of about $500,000 or less in promising startups, often buying those companies afterward, according to partners at Silicon Valley VC firms who spoke on condition of anonymity. In an effort to keep spotting promising deals, Google has been hiring a stable of finance pros. And it has invested more than $1 million in a Mumbai-based investment firm called Seedfund to gain access to technology such as automatic translation software that could help spur growth in India.
Beating VCs to the Punch
By staking startups, Google hopes to avoid paying the higher prices companies can fetch once they take funding from traditional VCs. It’s possible that some of its investments are conditioned on Google having first-acquisition rights should a target opt to sell, some VCs speculate. Google didn’t respond to calls requesting comment. Making investments in startups also can help Google use more of its $4.5 billion in cash to cultivate tools that complement existing products. Google recently started a program called Gadget Ventures to fund entrepreneurs who build online tools using Google’s technology.
VCs Seek Alternative Sources
The incursions don’t sit well with many VCs. Combined with the predilection on the part of many entrepreneurs to fund their own ventures, investments by Google and other corporations leave even fewer opportunities for VCs to take big, early stakes. That’s especially problematic when venture firms have raised record amounts of cash and need to find places to invest it (see BusinessWeek.com, 2/5/07, “Venture Capital’s Growing Aspirations”).
Thanks Allen for sharing the good link.
Not to be outdone, the Russian social network Vkontakte (or “virtual contact”) has copied Facebook’s look and feel almost exactly — not to mention its growth rate. See Alexa graph and screenshot gallery, below.
Copying Facebook has already turned out to be lucrative in other countries.
In Germany, Facebook clone StudiVZ was bought by a German publishing company for around $100 million; in China, Facebook clone Xiaonei was reportedly bought by a larger Chinese internet company for an undisclosed amount.
Vkontakte’s increasing Alexa rank:
Vkontakte’s brilliant design:
FaceBook Copycats Flooding | Read more @ Venture Beat