Article 43


Sunday, May 31, 2009

Innovation and Ignorance

Who are the Richistanians?  They are CEOs who have moved their companies abroad and converted the wages they formerly paid Americans into $100 million compensation packages for themselves.  They are investment bankers and hedge fund managers, who created the subprime mortgage derivatives that CURRENTLY THREATEN TO COLLAPSE THE ECONOMY.  One of them was paid $1.7 billion last year.  The $575 million that each of 25 other top earners were paid is paltry by comparison, but unimaginable wealth to everyone else.
- Paul Craig Roberts, Return Of The Robber Barrons, August 7, 2007

CIOs and other business leaders can’t afford to let recent broad but clearly protectionist comments from President Obama intimidate them from pursuing the BUSINESS PRACTICES that will LET THEM CREATE the MOST COMPETITIVE PRODUCTS and services possible by fully LEVERAGING GLOBAL SOURCES of talent and innovation as well as global sources of raw materials and FINISHED GOODS. Because it’s those companies that will succeed, which means they’ll grow, which means they’ll need to hire new engineers and designers and marketers and developers and salespeople and production workers and accountants and drivers and managers.
- Bob Evans

VoIP is one of the best innovations of modern telephony for our generation, along with the internet that revolutionized global communication and freedom of speech.

Nobody doubts that.

I think Author Evans in the second article is mixing apples with oranges in his support of outsourcing, while people like Senator BYRON DORGAN, and CNN anchor LOU DOBBS are a little closer to the TRUTH.

Is Evan’s a NEOCON?



The Value Of VoIP
Quicker, Better, Wiser

B Gene Marks
May 29, 2009

Nikhila Rao’s company needed a better phone system. This was last fall, when the recession was already in full swing. But Rao knew she had to act sooner rather than later. “Customer responsiveness is the key to our success,” says. “Even though we’re small, we have to show that we’re agile.”

Rao’s five-person outfit, Cincinnati-based Graphet Inc, earns its consulting fees by using fancy software and statistical modeling to help large companies--from food and beverage makers to paper and plastics producers--manage their energy usage. Such data can save these firms perhaps hundreds of thousands of dollars a year, in part by participating in state and federal programs that Graphet helps facilitate.

The trick: getting the giants to notice her in the first place. “Selling to the big guys when you’re small can be a struggle,” says Nikhila. “Getting in the door takes the right infrastructure. A good phone system is [the difference between] life and death to us.”

Six months ago, Graphet was still using a Ma Bell system stuck in the 1970s. Remote employees couldn’t connect; traveling employees couldn’t be reached and customers got busy signals (remember those?). When people did get through, many couldn’t get routed to the right person to help them. Meanwhile, Graphet continued to grow. “Fortunately for us, saving energy is the talk of the town,” says Rao. But she knew she would lose her competitive edge if she didn’t upgrade her system, downturn be damned.

Through a third-party vendor, Rao purchased a “Voice over IP” phone system, including software from CISCO (which routes the calls and plays nicely with her existing Windows operating system), as well as phone units for each user. With VoIP (the “IP” stands for Internet Protocol), calls travel over data networks like the Internet, rather than via traditional phone lines that are expensive to maintain. Total cost of the installation: $12,000, financed over three years--not a trivial investment for a small company in a recession, but one that continues to prove its worth.

Start with Graphet’s two employees who work from home. They have handsets that plug right into their home computers, connecting them to the company phone system through their own broadband connections. Now calls to the main number are sluiced to their home phones; if not answered, they bounce back to a live person or voicemail, without callers knowing. Better yet, customers who once got busy signals when they tried calling employees at home now get routed to another person, to voicemail or even to a cellphone.

“Whenever a customer calls, they’re sure to get hold of a live person--or at least leave a message for the right person,” says Rao. “We were never able to do that before.”

Graphet’s new phone system also came with “softphone” software that hooked any laptops to the phone system as well, via a wireless Internet connection. To listen and talk, all remote employees need is a cheap headset.

It gets cooler still. The voicemail system navigates callers through a simple automated directory. Any messages get converted into sound files that can be e-mailed, forwarded or saved.

How dependable is VoIP versus traditional phone lines? Rao says she hasn’t noticed any difference in the number of dropped calls or overall service. If the system acts up, Graphet can call a 24-7 hotline, administered by Cisco, to work through any glitches.

Rao estimates that switching to a VoIP system has cut her telecommunications bill by roughly a quarter. But shaving costs isn’t the biggest benefit. “When we’re dealing with big customers, we have to appear to be bigger,” she says. “We need to look professional. We need to be accessible. We wouldn’t be able to survive if we didn’t make this investment.”

Gene Marks is owner of Marks Group, a technology consulting firm, and author of The Streetwise Small Business Book of Lists.




Global CIO: The Ugly And Dangerous Prejudice Against Outsourcing

If American businesses yield to the anti-outsourcing caterwaulers, then don’t be surprised to see them go after other equally legitimate business tools next.

By Bob Evans
March 25, 2009

So EXPLAIN this one to me: When great IT companies develop new products and services that offer significant value to CIOs, we call it innovation. But when CIOs employ outsourcing to remain competitive and create new customer value, the outrage industry calls it anti-American and screeches about the loss of OUR JOBS.

This ugly and ill-informed nonsense has been going on for the past 10 years, which is about 10 years too many. Because if American businesses begin to yield even a single inch to the anti-outsourcing caterwaulers, then don’t be surprised to see them go after these equally legitimate business tools next:

Cisco says its new Unified Computing System could help CIOs cut IT operating costs in the data center and elsewhere by up to 35%, and surely some of that savings would come from reduced head count owing to more automation and more built-in intelligence. But wait—what about the loss of “our jobs” from such an approach—doesn’t that make the use of such advanced technology unpatriotic?

What about some of the lower-cost alternatives being offered by Salesforce dot com and other successful SaaS vendors? If the cloud offers a simpler way to run applications, then that means fewer support jobs will be required—so are cloud and SaaS companies therefore responsible for decimating tens of thousands of “our” IT jobs?

Last week, Hewlett-Packard signed a $50 million deal with Korea’s Shinhan Bank. To get the work done, should HP shuttle U.S.-based workers back and forth from Korea since HP is, after all, based in the United States and should therefore deploy only “our jobs” on the Shinhan Bank project? And that comes on top of HP senior VP Marius Haas recently citing his company’s far-flung development operations in India, Costa Rica, and Europe: “It’s a COMPETITIVE ECONOMY and you go where the TALENT is.”

Oracle says that because of the challenging global economy, it’s adjusting its hiring practices in the consulting sector by “load-balancing with contractors and integrators” rather than hiring more full-time professional-services employees. Hey, wait a minute—what about “our jobs”? According to the protectionist lobby, shouldn’t Oracle be forced to hire more full-timers and tell all of those contractors and integrators to get busy laying off the workers whom Oracle had been planning to retain to handle the consulting work?

On top of those examples, how about all the other highly intelligent IT products this industry has created in the past 10 years, all of which without question have led to the reduction or even elimination of various types of jobs: virtualization, systems management, network monitoring, rapid-development tools, Web-native software, and many more? Will they be taxed and regulated, or just pilloried as destroyers of “our jobs”?

CIOs today are being asked to squeeze costs aggressively while also keeping alive innovative projects that will lead to competitive advantage when the global economy improves. Neither those CIOs nor their companies can afford to ignore the very tangible benefits of tapping into the best sources of talent and skills and value the global market has to offer out of fear that some protesters or politicians will carp about it publicly.

And they should stick to their guns for two reasons: first, because doing so makes great business sense; and second, because of the hypocrisy shown by so many of the political class who live by the rule of do as I say, not as I do. Based on precedents, one of the likely carpers will be Sen. John Kerry, who for many years rode stylish motorcycles made in foreign countries: Ducatis from Italy and BMWs from Germany. Most people would say that if those are the bikes he wants to road, go right ahead. But personal preferences aside, Euro-biker Kerry will look to score political points as one of the tub-thumpers who tries to intimidate American corporations into cutting back on outsourcing even though it’s in the best interests of those companies and their shareholders and their customers and, yes, their employees to engage in outsourcing.


Just this week, U.S. Rep. Robert Brady of Pennsylvania described as “outrageous” the plans of JPMorgan Chase to accelerate the integration of Washington Mutual and BEAR STEARNS by stepping up its business with Indian outsourcing firms.

“We would like to remind you that the taxpayers of the United States of America contributed $25 billion to your company to help stabilize our economy, not send jobs overseas,” Brady recently wrote to JPMorgan CEO Jamie Dimon, as reported by my colleague Paul McDougall.

In the same vein, those CIOs and other business leaders can’t afford to let recent broad but clearly protectionist comments from President Obama intimidate them from pursuing the BUSINESS PRACTICES that will LET THEM CREATE the MOST COMPETITIVE PRODUCTS and services possible by fully LEVERAGING GLOBAL SOURCES of talent and innovation as well as global sources of raw materials and FINISHED GOODS. Because it’s those companies that will succeed, which means they’ll grow, which means they’ll need to hire new engineers and designers and marketers and developers and salespeople and production workers and accountants and drivers and managers.

Like every other person with a pulse, my heart goes out to those Americans—as well as workers in other countries—who through no fault of their own have lost their jobs in this global economic slowdown. And without question, some of those job losses have come as a result of CORPORATE DECISIONS TO SHIFT THOSE JOBS from the United States to other countries. But this current round of jobs being moved around the globe is not an isolated occurrence, it’s not something specific to our troubled times right now in 2009, and it’s not the CAUSE OF the rising unemployment in this country.

If U.S. firms are to remain competitive in the global economy, they need to be free to conceive, create, sell, and ship products in whatever combinations of locations and processes that yield the greatest chances for success. If that means making cars in the United States as Honda and Mercedes and Toyota do, then that’s terrific. If it means the iPod is “proudly designed in California” but is built in the Far East from components supplied from multiple countries, then that’s terrific as well. And if it means U.S.-based companies employ outsourcers to help them create great products and services that are sold around the world—thereby creating more jobs for that company in this country—then that’s equally terrific as well.

In addition to the comments above from HP’s Marius Haas, consider these remarks from execs at IBM and Sun Microsystems on the same subject of the futility of protectionist policies in a massively interdependent global economy, as noted in a Global CIO blog last week:

IBM’s Edward Orange, emphasizing that IBM manufactures products and delivers services in 170 countries, echoed Haas’ point: “IBM goes wherever the talent and the market is.” Orange is the Asia-Pacific director for IBM’s Lotus unit, the article said.

Sun’s Joe Hartley was even more blunt: “The policy may shrink global trade in the long run. Not every job can be outsourced. But a job has to be done at the right place and at the right time,” according to the Economic Times, which also offered these statistics: Indian subsidiaries of U.S. companies such as IBM, Sun, Microsoft, Oracle, and HP together employ over 150,000 people. IBM, which has more than 70,000 employees in India, sees no merit in U.S. government’s protectionist policies.

These are indeed hard times, but the approach that will GET US OUT OF THIS mess is the spirit of American innovation and determination, which over the past 200 years has created the highest standard of living the world has ever known with dazzling breakthroughs in medicine, manufacturing, higher education, entertainment, space exploration, PHARMACEUTICALS, and much more. Going into the 21st century, we have the opportunity to leverage that priceless spirit of American innovation and determination with not only the remarkable IMMIGRANT entrepreneurs who’ve CONTRIBUTED SO MUCH to this country but also with GLOBAL PARTNERS in countries across the globe who currently serve as our partners in every industry. To attempt to cut off those enormously valuable partnerships and collaborations, and to attempt to turn the clock back 50 years and magically define what “our jobs” are, will only ensure that today’s hard times stay with us for many years to come.


Posted by Elvis on 05/31/09 •
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