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R&D Development a Key for the Future of IT in India
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Shane McGlaun/DailyTech
July 23, 2009
IT outsourcing has become common for many different companies as they take jobs that in the past were kept in America and send them overseas to developing nations where workers will do the same tasks for a fraction of the cost America workers demand. This is a good thing for the foreign workers, but it’s hard to find a silver lining for Americans losing their jobs to overseas workers.
There are several countries where many American firms are conducting R&D operations as well as manufacturing including China and India. India in particular is becoming a hot spot for high-tech R&D reports Reuters. Microsoft is one of the largest technology firms based in the U.S. to outsource a major portion of its R&D to India.
Microsoft runs a research center in India is staffed with 60 full-time researchers, many of them Indians with PhDs from top universities in America. Reuters reports that the office is at the center of Microsoft’s R&D operations. The center works in seven areas of R&D for Microsoft including mobility and cryptography.
One of the key innovations for Microsoft’s new Bing search engine was developed at the India location. The tool enables searches for locations with incomplete or incorrect addresses. One of the research centers directors B. Ashok told Reuters that the innovations wouldn’t have taken root if the R&D had been done in America.
Ashok said, “It was completely inspired by the Indian environment, but is applicable worldwide.”
Reuters reports that while India is a top spot for some firms, R&D operations the country is hampered by serious problems with its infrastructure. Those issues include a lack of government support and not enough home-grown researchers.
With a country with as huge a population as India, it’s surprising to note it only produces about 300,000 computer science graduates per year and only about 100 PhDs in computer science per year. By comparison, the U.S. produces about 1,500 to 2,000 computer science PhDs each year.
Microsoft’s head of strategy at the Microsoft India Research Center Vidya Natampally said, “Students here are not exposed to research from an early age, faculties are not exposed to research and there’s no career path for innovation because there’s a lot of pressure to get a ‘real’ job.”
The Indian government also offers little in the way of incentives to encourage innovation. Natampally said, “China has a policy in place for R&D; we don’t.”
China has pulled ahead of India with respect to R&D centers with 1,100 of them compared to the 800 R&D centers in India. China offers funding to help encourage students to complete PhDs and financial incentives like tax breaks to lure R&D centers into the country. The lack of R&D innovation in India is apparent in the number of patents granted in the country. In 2006 to 2007, India only claimed 7,000 patents compared to the 160,000 patents granted in America.
Praveen Bhadada from consultant firm Zinnov said, “We’re nowhere near the U.S. or even Israel when it comes to innovations. Our costs are low and our talent pool is ahead of China, Russia, and Ukraine, but China gives specific incentives, and produces way more PhDs than we do.”
In June Vineet Nayar, CEO of HCL Technologies, a major Microsoft partner, complained at a conference in New York City that American technology graduates were unemployable. Nayar stated that he felt tech graduates in India, China, and Brazil were superior and that Americans were only out to dream up the “next big thing.” The bias against innovation runs deep in many Indian companies.
© 2009, DailyTech
LesPaul
3 months ago
14 comments
Oh! I always wondered what was the cause of the quality of MS products, and the reason why they are performing like this, thank you for the clarification Vinnie. "It's Made in India!"
I do not think that graduates overseas are better prepared, they have a better attitude as this financial genius says, they have the attitude that "ring$" to his CEO ear$, meaning:
"I'm willing to do anything for 95 cents/hour, (or less)"
Yeah! that's the attitude kid, that's the spirit..! Go for the extra mile without any gas!!
Why should a true American company have anything to do with a guy who consider ourselves useless?
Maybe because despite the fact that we are unemployable and therefore, unemployed he can make 170Million "USD" (not rupees) per contract from and "american" company?
Barack my friend, shouldn't we have a legislation somewhere to stop this? before we all end in jobs that cannot be outsourced, like janitor, plumber, warder with our unemployable American degrees? What is the point of creating thousands of jobs and then send them abroad only to increase the ROI of a greedy corporation? (and decrease quality)
If this genius really think this, he should stop sending his kids for training over here.
Vineet and friends, stay at home and please leave your archaic royalty there it doesn't apply here.
TonyAKAMrClean
6 months ago
72 comments
...and our country gets weaker, and weaker. It's a wonder why I'm an IT professional WITHOUT going to college. I've met countless millionaires in the IT industry who've never gone to college and just as many unemployed (or under-employed) college graduates.
That said, I'm all for the employment of talent, however, I think outsourcing is implemented on such a large scale that talent no longer has anything to do with it. It's all about cost.