FRAMINGHAM (02/28/2000) - I just returned from a three-week trip to Asia, including nearly a week in India, and I can report that the Internet startup craze is alive and well in Japan, China, Taiwan, Thailand and India. Most impressive, though, were the achievements and potential of India's software industry.
Almost everywhere you go in India, you see apparent chaos. In traffic jams you have Mercedes-Benzes and 1950s-era cars and trucks competing with bicycles, three-wheel vehicles and carts pulled by horses and oxen. People in cars honk their horns incessantly, as if they can really influence the confusing flow of traffic. Everybody stops to let cows cross the road. Masses of destitute people live in abominable roadside huts and tents. There's a scarcity of basics such as clean water. Bazaars spring up without notice. Crowds of people are everywhere, many of them waiting for buses or walking. In parts of India, it seems that the population increases faster than the food supply.
And then you have the Indian software industry. Recent data I have seen says that of the top two dozen or so software development facilities rated at Level 5 - the highest level on the 1-to-5 process maturity scale established by the Software Engineering Institute (SEI) at Carnegie Mellon University - 11 are in India. (One is in Japan, and most of the rest are in the U.S.) The 11 Indian firms include U.S.-owned subsidiaries such as Motorola India Electronics Ltd. and IBM Global Services India and local companies such as Satyam Computer Services Ltd., Tata Consultancy Services and Wipro Infotech.
I have some personal history (and minor bragging rights) in India. In 1990, I consulted for Motorola on software processes, using my book Japan's Software Factories (Oxford University Press, 1991) as a blueprint. To make up for a shortage of programming talent, Japan had taken to standardizing around best-practice development methods and encouraging reusability and Japanese-style quality-control techniques. NEC, Toshiba, Fujitsu and Hitachi made impressive gains in productivity and quality, and Motorola officials were interested in creating a Japanese-style software factory within the company.
When it proved difficult to get U.S. managers interested in the idea of a software "factory," Motorola decided to try a "clean sheet" approach in India.
In 1991, this became Motorola India, which now has more than 500 software engineers as well as an SEI Level 5 rating. I also learned that India's largest software company (also an SEI Level 5), Tata Consultancy, has used Japan's Software Factories as a key input for its facilities, especially for recent Y2k work.
However chaotic the rest of India may seem, India's engineers are world-class.
According to data collected by Deependra Moitra, general manager at Lucent Technologies India, the country's software industry generated some $5.5 billion last year for the nation's economy, and that figure was growing at an annual rate of 50 percent, up from a mere $20 million in 1989. India exported software to 86 countries last year (mainly the U.S. and Europe). Companies now employ some 260,000 software engineers and are adding 40,000 per year, though businesses are fighting to attract and retain experienced engineers.
In the 1980s, Japanese software factories developed great process capabilities, too, but never moved much beyond mainframe systems for the domestic market.
That's finally changing, such as with Web-enabled cell phones, although Japanese computer companies are still struggling. Even if Indian software engineers never invent new products or standards, India's software companies have already made invaluable contributions to the country's economy and reputation. "Made in India" is a sign of quality - at least in software.
The bottom line for U.S. managers? Buy Indian software, set up software facilities there and study how India has made progress so quickly in software quality.