Friday, July 6, 2007

Decline of a restaurant

There used to be this great eating place called Ramana's on Cunningham road on Bangalore. I always liked it very much and quality and taste of food there used to phenomenal.

I used to visit them regularly and then for last six months or so I did not get a chance to go to that part of town. Yesterday I again visited them and to my dismay, the quality of food was really poor to average. It was really sad to see another good restaurant go down the path of so many other in Bangalore.

I don't understand why that happens, every restaurant eventually degenerates itself into a shanthi sagar. May be it is the oft-repeated business model of every software company trying to degenerate itself into an sweat shop.

Anyway, one less place to choose from if you just want good food and nothing fancy.

Tuesday, July 3, 2007

A company called Riya

So I am as usual surfing the net and I come across this interesting headlines from the times of India.
Wages killing Bangalore BPOs?

Now for most part I don't really give much credibility to what TOI writes but this one had this reference so I thought I should read.
In a blog posting, company's chief executive Munjal Shah, complained, â??Bangalore wages have just been growing like crazy. To give you an example, there is an employee of ours who took the first five years of his career to get from 1 per cent to 10 per cent of his equivalent US counterpart.

"He then jumped from 10 per cent to 20 per cent of his US counterpart in the next 1 year. During his time with us (less than two years) he jumped to 55 per cent of the US wage. In the next few months we would have had to move him to 75 per cent just to 'keep him at market."

I got interested in this because nobody ever offered me this kind of money. So I though let's search for this guy's blog which I found here.
Now the latest post in this blog talks about the fact that he closed his company's India operations and he let one guy come over to US after firing everybody in India and that guy is really grateful to him.
Dhiraj impressed the heck out of both of us. His dedication and attention to detail is amazing. He once drove to our IT guyâ??s house in Bangalore (who was not being super responsive), brought his laptop and made him fix something on the spot. Dhiraj is willing to call anyone in the middle of the night (including me and Azhar) to fix a bug if it is live on the site and critical.

As Azhar and I were making the list of people who should come to the US, we knew we needed Dhiraj. We knew he was someone we wanted by our side. He had earned it as much as anyone and we felt good to be able to give him the opportunity.

I remember the look on his face when we told him about the opportunity to come to the US. He looked like he was going to cry tears of happiness. He later told us that if he comes, he will be the first one from his village to every go to the US.

Now that sounded like non-sense. I was the first guy from my village to go to US I did not cry tears of happiness, my village is in UP which comes very close to Bihar in whatever way Mr. Munjal has mentioned it. Anyway this was no proof of the original TOI story, so I further in his blog and found this older post.

So the TOI story was right, not really BPO but we can't expect TOI to differentiate between a search engine and a BPO just like WSJ can't figure out that iPhone is not the first phone with a touch screen.

So I thought about the salaries quoted by him. I work for an MNC, have worked for last 13 years in India, in US and hired lots of people, interacted with hiring managers from other companies and for most part here is what I think salaries are in India.

  • Freshers get paid anywhere between Rs. 250,000 to Rs. 600,000. Only really few are picked up by companies like google at salaries beyond this range. That is more like between USD 6250 to USD 15,000.

  • Most of the people with 5-6 years of experience would earn between Rs. 500,000 to Rs. 900,000. i.e. more like USD 12,500 to USD 22,500.

  • People with 10 years of experience (if they are lucky) actually get paid above Rs. 20,00,000 i.e. USD 50,000.

Now I am not sure where this company was hiring its people from. Based on my knowledge of the industry, this looks like either they were running really inefficient operations or just got scammed by a bunch of high profile engineers. What really ticked me off what this comment by Mr. Munjal on his own post.
At the end of the day is it about productivity vs. costs. The wages of the engineers in Bangalore can rise all the way to the US level so long as the productivity is equal. Even if we assume that an top guy here in Bangalore has the skill and intelligence as the US, he still maybe less effective for several reasons:

His infrastructure is less reliable. I was just hearing from one the guys on our team (who is moving to the US) that he sometimes gets up early to work on stuff while he is fresh. Frequently, however, his power goes out and then he has to come into the office (where more people are likely to bother him).

He will lose more time in transportation - horrible traffic and no parking which eat up more hours of the day than they do in the US. Even his home broadband connection is slower and unreliable - impacting his productivity there.

These external factors even include things like food. Each month at least 1-3 people call in sick for food sickness or for a Bandh (rioting in the streets). This rarely happens in the US.

Over time these things start to add up.


In last 12 years in Bangalore i have seen probably 10 cases of rioting or bandh. That is more like 10 days of lost work in last 12 years and most of the software companies anyway make you work on a weekend to compensate for that. And the comment about food, he pays his employees salaries that are 75% of US salaries and they can't even afford decent food. He must be out of his mind.
For me personally this might be the end of an era. I spent six month a year in 2002 and 2003 in Bangalore. I loved being here and almost bought a house. I have some very fond memories of brunch at the Leela Palace on Sundays and partying all night at Spinn. I dont' know how much I'll continue to be in Banglore now, but it was a great part of my life for the last 4-5 years.

I was one of the biggest, India advocates you've ever met (I still am) but it is clear the primary business drivers of Bangalore are changing and with it the city must change.

Now probably his employees were calling in sick because they were having party at leela palace all night or something else but the fact is with people like Mr. Munjal Shah as advocates of India, I don't think we need enemys.

I can not attach any motivation to why Mr. Munjal Shah is doing what he is doing or writing what he is writing but I know for a fact that he is just exaggerating the facts or just does not know the facts.

Enough of a rant. I should have kept quite.