Learnings from a Tiny, Distant Land



Sitting in a cozy pub in chilly Dublin, a pint
of Guinness draft in hand, I again marvel at how small Ireland is. Four million
people-smaller than South Delhi. You can drive the length and breadth of the
country in a day.

And yet it’s a software giant. A top software exporter,
number one at product development. It’s a study in focus-on high-value work.

Now, I don’t believe in an all-pervading ‘value
chain’, a book you live by, working your way up the chapters. China has shown
that you can choose and dominate any niche. A nut for the wheel of a bicycle, or
a cheap keyboard: excel, target the world market, dominate it. If there’s a
need for data entry or digitization, and you can provide the best service at the
lowest cost, you win. You aren’t damned just for occupying a low rung of the
value ladder. You can choose your services space, the type of work, people.
That’s a sound proposition. You can find people in India to answer phone
calls, or design and validate a CPU.

But this Celtic tiger showed how quickly you can adapt when
forced to. Ireland, too, started off with tech services: for UK, USA, Europe.
But as the industry developed, it began to run out of people. And with a
galloping economy, Ireland was a victim of its own success: prosperity, jumping
wages… Dublin became one of the most expensive of cities. Services? Ireland
just wasn’t competitive any more.

And so their tech industry rapidly evolved. It shifted
toward products and IP work. It spawned strong companies with just a few dozen
staff. The entire industry recruits in a year less than what some Indian
companies would.

The culture-flexible, disciplined, allowing even working
from home-is backed by an environment that encourages, even funds, innovation
and high-value work. Universities encourage staff and students to turn their
ideas into commercial ventures, with funding and support, especially in infotech
and biotech. (And a 10% corporate tax for manufacturing has helped Intel grow
its factory there to 5,000 people-chip fabs aren’t the people-intensive ops
that software and services are.

In Dublin I asked Ireland’s Prime Minister what Indian
tech meant to him: friend, potential partner, competitor, role model? A bit of
all of that, he said. As he leads a large Irish trade and education delegation
to India in January, it would be worthwhile for Indian tech companies to also
consider Ireland: as partner, and perhaps even role model for those who wish to
walk that route. Especially as the HR demand-supply situation worsens and wages
spiral.

The full spectrum of the value chain still lives. But a lot
more companies may need to look at including high value work in their portfolio,
to grow-or just to stay alive.

Prasanto K Roy
pkr@cybermedia.co.in

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