-

The talk will focus on David Michael's recent research into the globalization strategies of companies from China, India, and other rapidly developing economies. Increasingly, companies such as Haier, Huawei, CNOOC, Wipro, Bharat Forge, and Lenovo are emerging on the global stage. What strategies are these companies using, and what implications do they pose for their more-established competitors from developed markets? How are these companies leveraging engineering talent, low costs, and market access in their home countries? How do they approach global market entry, organizational development, and mergers and acquisitions? Which global industries are most threatened? What opportunities do such companies present to Western players? Which are the "most promising" new companies--the ones that you haven't yet heard of?

David Michael heads BCG's Beijing office and is on the global leadership teams of BCG's Technology and Communications practice and Operations practice. He has advised clients in various industries in the region for more than a decade and has worked in more than ten Chinese provinces. He holds a B.A. in economics magna cum laude from Harvard University and an M.B.A. from Stanford University, where he was awarded the Ernest W. Arbuckle award for outstanding class member. He was also a Rotary Scholar at the Chinese University of Hong Kong during the 1989-1990 school year.

Philippines Conference Room

David Michael Senior Vice President, Beijing Office Speaker The Boston Consulting Group (BCG)
Seminars
Authors
News Type
Commentary
Date
Paragraphs
The arrogance of the Bush administration would be barely tolerable if it were not paired with a stunning incompetence, on display from Kabul to Katrina. That deadly combination has weakened American strength in the world, argues Pantech fellow and San Jose Mercury News foreign affairs columnist Daniel Sneider.

Despite its attempt to soften criticism of the war, there is no evidence the Bush administration is capable of self-correction.

That came home to me the other day while listening to a senior administration official deliver an off-the-record tour d'horizon of American foreign policy. He is among the best minds in this administration, counted among the ranks of the realists, rather than the neoconservatives.

The United States stands alone as the most powerful nation in the world, the official began. In no previous moment of human history has a single state enjoyed such a dominant position.

When it comes to managing its relations with other would-be powers -- Europe, China, Japan and India -- the United States has done "extraordinarily well,'' he said.

The tensions generated by the war in Iraq have eased, the senior foreign policy official confidently asserted. The Europeans are content to gaze intently inward, he observed, while America strides the globe.

Japan is embracing the United States in a very close relationship that shows no sign of unraveling. Meanwhile the Bush administration has forged a growing partnership with India.

When it comes to China, the administration has chosen the path of accommodation and integration rather than containment of the rising power. He expressed confidence that American power and the prospect of democracy in China will secure the peace.

The only remaining challenge for the United States is to combat the threat of a radical Islamist movement that seeks to acquire weapons of mass destruction. For that, there is the promotion of democracy and American values around the world. After all, the official said with not even a nod to humility, "the U.S. is the most successful country that has ever existed.''

A year or two ago, the American people embraced this vision of a confident colossus, a Gulliver among the Lilliputians. That was before they watched the giant tied down in its attempt to export those American values by force of arms in Iraq.

The arrogance of this administration would be barely tolerable if it were not paired with a stunning incompetence, on display from Kabul to Katrina. That deadly combination has weakened American strength in the world. It has emboldened far more serious challengers in Iran and North Korea, who see the United States as too bogged down in Iraq to credibly threaten them with the use of force.

The war rated barely a mention in the sweeping view offered by the senior administration official, except indirectly. He offered a realist defense of the administration's democracy crusade.

World War II was fought with democratic goals, the official pointed out. And the Cold War -- the model for the current struggle against Islamic extremism -- was not just about balancing the power of the Soviet Union. The wars in Korea and Vietnam were really about determining which system those countries chose, he argued.

Those are curious examples to cite as a defense of the decision to go to war in Iraq. The United States shored up authoritarian regimes in Korea and Vietnam to counter the communist threat. Vietnam was a strategic mistake that took decades to overcome. And democracy came to Korea more than 35 years later, after a long period of economic development.

President Bush cited the democratic transformation of Korea -- along with Taiwan and Japan -- in a recent speech during his trip to Asia. But these are examples of the "conventional story in which you become rich and then you become democrats,'' as the senior official put it so well.

The administration proposes however to skip this long, but necessary, path to democratic capitalism when it comes to the Middle East. The policies of security and stability have failed there and a quicker route to democratic change is called for. But there is no historical evidence to suggest that this is any more than another manifestation of a blind belief in American power.

Democratic values have always been essential to American foreign policy. In practice, however, American administrations have often made painful choices between stability and the promotion of democracy. We saw that too often during the Cold War -- in Budapest in 1956, Prague in 1968 or Tibet in 1959.

The administration might do well to recall the words of candidate Bush, uttered Oct. 11, 2000.

"It really depends on how our nation conducts itself in foreign policy. If we're an arrogant nation they'll resent us,'' Bush said. "But if we are a humble nation, they'll respect us.''

All News button
1
-

Multinational corporations (MNCs) have increasingly located research and development (R&D) in developing countries like China and India since the 1990s. On the one hand, governments in developing countries are eager to attract R&D to their local economies; on the other hand, developed countries are concerned about losing their competitive advantages due to R&D offshoring. At the same time, intellectual property (IP) protection is a growing concern considering the weak IP institutions that developing countries typically have.

Presenting both survey findings in Beijing and several case studies on individual MNC R&D labs, Dr. Quan examines MNC R&D labs' activities in China and puts forward a 'hierarchical modular R&D structure' as means of IP protection in weak IPR regime countries.

Quan has extensive research experience in the areas of technology & innovation management, international business, strategy, entrepreneurship, and regional economic development. Besides her recent publications on the Chinese software industry and on Chinese and Indian immigrant professionals in Silicon Valley (with Saxenian), she also has a number of publications in Chinese academic core journals such as "China Industrial Economy." Quan holds a PhD from the University of California at Berkeley, an M. Econ. degree and a B.S. degree both from Beijing University, China.

Philippines Conference Room

Xiaohong (Iris) Quan Speaker
Seminars
Authors
News Type
Commentary
Date
Paragraphs
As President Bush continues his tour of Asia, Pantech Fellow and San Jose Mercury News columnist Daniel Sneider observes in YaleGlobal that growing regional cooperation threatens U.S. preeminence in East Asia.

On the surface, President Bush's week-long swing through Northeast Asia has been a strong contrast with his recent stormy (and, some say, stumbling) excursion into Latin America.

There was little sign of overt anti-Americanism. And no Asian leader will openly oppose American leadership in the flamboyant manner of Venezuela's Hugo Chavez. Even prickly China swallowed President Bush's barbs about lack of democratic freedom in China, quietly acknowledging the two powers' differences. In contrast to the meeting of leaders from the Americas, the annual summit of the Asia Pacific Economic Cooperation (APEC) forum in Korea will embrace the principles of free trade.

Beneath the polite appearance, however, there is no less a challenge to American leadership in Asia. While Washington fiddled, a powerful momentum has been building up in Asia toward the formation of an East Asian Free Trade Area or, more ambitiously, an East Asian Community, modeled on the European community. Led by China, the East Asian grouping pointedly excludes the United States.

The APEC agenda focuses on an initiative to counter the spread of avian flu and to offer a common push at the WTO meeting in Hong Kong next month to revive the Doha Round of global trade talks. The Bush administration has its own agenda for the APEC meeting: to reposition itself as a leader of economic growth and integration in the region. For this, APEC has the virtue of being a more open organization than those behind the disappointment at the American summit. Its 21 members span the Pacific Rim, bringing together nations from Chile and Mexico to Russia, China and Southeast Asia. But this attention to APEC may be a case of too little, too late. The momentum to give the amorphous APEC an ongoing institutional role, beyond its annual summit meetings, has slowed in recent years. Its pledges for mutual tariff reduction exist almost entirely on paper.

Until this year, the Bush administration barely addressed regional economic issues at APEC. It preferred to use the meetings to promote a post-9/11 security agenda of anti-terrorism. U.S. trade policy has focused more on reaching free trade agreements with a few selected "friends" in that war, such as Singapore and Australia.

Meanwhile a Chinese-sponsored move to hold an East Asian summit offers the most visible expression of a trend of declining American influence in Asia. That meeting will take place in Malaysia in mid-December. The gathering groups the 10-member Association of Southeast Asian Nations, Japan, China, South Korea, India, Australia and New Zealand. Pointedly not invited is the United States.

This meeting is an outgrowth of the ASEAN Plus Three (APT) process - an annual dialogue of ASEAN with China, South Korea and Japan that began in December 1997 in the midst of the Asian financial crisis. The APT has grown into an elaborate mechanism for cooperation in a range of areas from finance and agriculture to information technology. This reflects an underlying economic reality - the growth of regional and bilateral trade agreements and the rapid rise of intra-Asian trade.

Until fairly recently, foreign trade in East Asia was dominated by trans-Pacific trade with the United States. But the share of Asian exports headed to the U.S. has dropped dramatically, while those destined for other Asian nations has risen. In the two decades from 1981 to 2001, according to economist Edward Lincoln, the share of intra-regional exports has risen from 32 percent to 40 percent, and intra-regional imports from 32 percent to 50 percent.

Much of the growth of regional integration is being driven by China, which is generating enormous demand for imports of raw materials as well as for semi-finished goods that are assembled for export. China has not been hesitant to use this role to expand its influence in the region. It has embraced the APT as a road towards creation of an East Asian community. At the ASEAN summit last year, Chinese Premier Wen Jiabao declared that such a community was a "long-term strategic choice in the interests of China's development." China has also outmatched the U.S. in negotiating free trade agreements, both bilateral and regional. The most impressive is an FTA deal between China and ASEAN set to take effect in 2010. Beijing even dreams of an Asian currency, based on the Chinese yuan, to rival the dollar and the euro.

China is not the first nation to try for such East Asian economic unity. Back in the days when Japan was riding high as an economic superpower, it too talked of leading an East Asian bloc, based on a yen currency zone. As late as 1997, in response to the Asian financial crisis, Japan proposed the creation of an Asian Monetary Fund, a kind of alternate regional financial system. More recently, both South Korea and Japan offered their own visions of an East Asian community in 2001. And both countries tried to match China in the APT by offering to form free trade agreements with ASEAN.

Japan, however, was never as successful as China is likely to be. "It would seem that Japan is a natural counterweight to China, but Tokyo is generally perceived as reactive and incapable of outflanking Beijing," Brad Glosserman, director of research at the Pacific Forum of CSIS, wrote recently. "Its economic dynamism is no match for that of China."

The United States has never been friendly toward efforts to create an East Asian economic bloc, viewing them as chipping away at the global trading system and rivaling American leadership. But Asia is arguably only following in American footsteps -- witness the NAFTA deal with Canada and Mexico and the more recent trade pact with Central America.

Many American policymakers believe these developments are partly a product of the failure of the Bush administration to articulate - much less pursue - a strategy to engage East Asia.

"The United States has greater strategic interests in Asia now than it did in Europe before World War I or World War II,'' argued a recent report of the Grand Strategic Choices Working Group, co-chaired by John Hopkin's University's Francis Fukuyama and Princeton's G. John Ikenberry. "Thus," the report continued, "it is unfortunate that part of the problem, in East Asia in particular, is that America's relative lack of interest in tending to the region has caused some allies of the U.S. to doubt our resolve and question the value of resisting unfavorable developments alone."

The report echoes other policymakers in suggesting the U.S. form its own East Asian economic zone with Japan, South Korea and Australia."That's a non-starter,'' says Professor Vinod Aggarwal, director of Berkeley's APEC study center. "Nobody wants to be cut out of the China market."

Privately, Bush administration officials downplay the importance of the East Asian summit in December, pointing to the lack of any concrete agenda. The addition of India, Australia and New Zealand to the invitation list, along with Japan, should effectively counter any Chinese initiative, they believe.

But those countries also fear being left out of whatever may emerge from this process. They cannot afford to be left on the outside, looking in.

Ultimately, neither can the United States. The President's trip is a belated recognition of that fact. But to be more than a momentary gesture, the United States must give East Asia the consistent attention it deserves.

All News button
1
-

Open source software (OSS) is widely used as operating systems (Linux), web tools (Apache, JBoss), database platforms (MySQL) and a range of applications. Creating OSS is widely believed to be a relatively easy process compared with proprietary software. Its growing use and support from large firms such as IBM and HP have led many to believe that OSS will ultimately replace proprietary software. While this is hotly debated, there is little doubt that as its use increases, it will impact how software services will be delivered. In particular, low cost global delivery centers might benefit from ready access to OSS code. The panel will discuss these and other issues related to the globalization of software services caused by OSS.

Panelists:

Mike Balma is HP's Linux Business Strategist. Mike has helped drive HP's strategy for Linux and Open Source software across HP since 1999. Mike is a member of HP's Open Source Review Board that reviews HP open source projects. He was involved in the Linux port to Itanium. He also helped create an exchange for open source software development. And he helps drive HP's Linux strategy in the public sector including the security related technologies and certifications.

Mitchell Kertzman is a partner at Hummer Winblad Venture Partners. He has over 30 years of experience as a CEO of public and private software companies. Most recently, Mitchell was chairman and CEO of Liberate Technologies, a provider of platform software for the delivery of digital services by cable television companies.

Rajesh Setty chairman of CIGNEX Technologies, Inc., a company that he co-founded in late 2000. Setty has managed technology projects and practices over the last 14 years in several parts of the world (India, Singapore, Malayisa, Hong Kong, France and the United States.)

Philippines Conference Room

Mike Balma Linux Business Strategist Panelist Hewlett Packard
Mitchell Kertzman Partner Panelist Hummer Winblad Venture Partners
Rajesh Setty chairman of CIGNEX Technologies, Inc. Panelist
Seminars
-

The US-India corridor for services outsourcing, now over three decades old, has moved from providing software programming to a wide range of lines of work, encompassing business processes, call-centers and analytical work, and going beyond its original focus on the banking industry to cover other financial services, healthcare and personnel management. The talk will address the benefits and risks associated with outsourcing,  the value proposition from a vendors' perspective and trends in the outsourcing services industry. The talk will take an analytical view of the drivers of outsourcing, going beyond the usual arguments based on cost arbitrage to show how firms like TCS have built defensible businesses based on process maturity, domain expertise, scale and scope. 

Surya Kant (known as Sury) is  President, Tata Consultancy Services  North America. Tata Consultancy Services Limited (TCS) is India's largest global IT consulting and services company, employing over 50,000 persons in 34 countries. His 27 year career with TCS includes setting up TCS Japan in 1987. He has also been country manager, TCS UK.  His focus areas include software quality assurance and delivery center management.

Sury received his Masters in Electrical Engineering from IIT Delhi (1978) and his Bachelors of Electrical Engineering from Delhi College of Engineering (1976). He is a member of the Association of Computing Machinery (ACM), USA. He was nominated to the Tata Group Top Strategic Leadership Programme in 2004.

Tea and samosas will be served.

Philippines Conference Room

Surya Kant President, Tata Consultancy Services Limited, North American Operations (TSC) Speaker
Lectures
-

In today's global economy, access to resources around the world has never been easier. The high tech industry has always been in the forefront of globalization in lowering costs, acquiring talent as well as serving markets. For instance, Asian countries have long been known for their vast manufacturing bases for western high tech industry.

In recent years, thanks to Y2K, India has become the leader in software outsourcing. China, given its expanding economy as well as its open market direction, has rapidly become the emerging location for multi-national semiconductor companies to outsource their product development amidst China's own burgeoning integrated circuit (IC) industry. Mr. Lee has first-hand experience in building and managing an IC product development center in Shanghai, China. He will discuss the challenges of operating a R&D organization in an environment of different languages and cultures. He will also share his vision of the future of the IC industry in China.

Mr. Lee is Group Vice President and general manager of Timing Solutions Products at Integrated Device Technology, Inc.(IDT), a public semiconductor company of $650 million annual sales, focusing on valued-added solutions for communication, consumer and computing markets. He has been with IDT for the last 22 years and has served various management roles. In 2001, he architected the acquisition of Newave Semiconductor Corporation in China and established the Shanghai Product Development Center for IDT. Before joining IDT in 1984, Mr. Lee spent 5 years at Intel Corporation as a technologist for the early development of flash memory technology. Mr. Lee earned his B.S. degree in Electrical Engineering from National Taiwan University in 1975 and M.S. degree from Case Western Reserve University in 1979.

Philippines Conference Room

Jimmy Lee Group Vice President & General Manager of Timing Solutions Products Speaker Integrated Device Technology, Inc.
Seminars
Authors
George Krompacky
News Type
News
Date
Paragraphs

Dr. Liu first offered his view on the current state of the software industry's development and in particular software outsourcing to China. Software prices and margins continue to drop. Coupled with this reality is Liu's view that "only 10-15% of software development is truly innovative and therefore suitable to be developed in Silicon Valley". As software development platforms and communication technologies, especially the Internet, become ubiquitous and affordable, distributed software development is becoming the rule.

China's challenges and advantages in software outsourcing

Compared to India, the leader in software outsourcing, China has its own distinct challenges. Chinese software companies have almost no U.S. customers for a number of reasons: language barriers, different working styles, customers' concern for software piracy, and the lack of experienced programmers and technical managers in China. Yet, China also has its advantages. Not only does it have a rapidly expanding domestic software market, but it also has a large pool of fresh engineering talent. "The key, therefore," asserted Dr. Liu, "lies in someone creating the right environment to train and build a local team to be able to develop and deliver world-class software products."

Augmentum's software development goals

This is what Augmentum has set out to accomplish. "...[W]e want to build a world-class, distributed development team for software product development... like the ODM model in the PC world..." declared Dr. Liu. Based on this vision, Augmentum's strategy hinges on its insistence to develop software for top US customers, such as Motorola, Business Objects, and PalmSource--and to rely primarily on local Chinese engineers. Explained Liu: "We want to make sure that the center of most of the people of that team is going to be in China, even though the locomotive, the teachers, is in the U.S., because that's where the leadership is in the software product development world."

Drawing on decades of experience developing top software teams at IBM and other companies, Dr. Liu detailed his company's efforts to attract the brightest local engineers and train them to be even better. He explained, "Culture and team is the true differentiation of Augmentum.... The real...challenge is to build the right culture with the right core team." The company insists on having no expatriates in their China operations but promoting close interaction between experienced mentors in the U.S. and the young teams in China, sometimes using some creative approaches for recruitment and training. For example, Augmentum puts all of its new hires under "a stress test" after hiring and proactively maintains an "upfront churn of at least 30%" in the first three-month period." Their end goal: "a world-class software development team that can bridge the East and the West but still has a cost structure comparable to local companies."

Liu's focus for the future

Despite experienced leadership, ties to leading U.S. companies, and strong young software teams, Augmentum faces real challenges. Liu acknowledged skeptics who question the ability to build a world-class team through working on the "crumbs of companies" of "projects they don't want to work on themselves." Nevertheless, he is confident in the trajectory of Augmentum's future growth, as the company is expecting to double its employees every year for the coming few years. In addition, Dr. Liu's vision includes a landscape beyond Augmentum. "I have a very simple focus. I want to train a lot of world-class software developers in China to serve the world. Many of them will not be working for Augmentum. It is fine...I want to bring my experience to there to make it happen. And the best vehicle to do that at this moment and time, the wave [that] I want to jump on is outsourcing, because it is growing the fastest."

Biography of Leonard Liu

Leonard Liu has spent 30 years in the systems industry, with a track record of developing innovative computing technologies into successful businesses. Most recently, he served as president of ASE Group, a leading provider of IC test and packaging services, having held roles as Chairman and CEO of Walker Interactive Systems, COO of Cadence Design Systems, and President of Acer Group. He was an early champion of outsourcing to India and China at Cadence and Walker. Dr. Liu began his career at IBM where he was responsible for the creation and implementation of SQL and the management of CICS, SNA and AIX, eventually overseeing the worldwide Database and Language lines-of-business. He received his undergraduate degree from Taiwan University and his Ph.D. from Princeton University.

All News button
1
Subscribe to India