In August I had the opportunity to participate in a NASSCOM delegation to China; it was a good learning experience about the changes in China in recent times. The timing was interesting as the same week China had overtaken Japan as the second largest economy in the world. Another highlight of the visit was the Shanghai Expo (http://en.expo2010.cn); it was a live demonstration of the developments made by China and their will to be the best in what they do. The Indian pavilion was nice to visit, however I wish we could have displayed the advances made by our country and not just the culture and heritage. Some pavilions like the ones from China and Saudi Arabia used new age audio visual technology to showcase their history, which was very good.
The dynamics of the political and business relationship between India and China was another interesting learning; the trade between the two countries is expected to reach US $60 billion in 2010. Although the balance of trade doesn’t favor India.
Getting back to the subject “The Curse of Compliance”, it’s a well accepted fact that compliance and regulations are the biggest drivers for risk management and security invetments. I should not be complaining about it, being a co-founder of a risk and security services company. However somehow I always feel uncomfortable about it. I guess I come from the school of thought that risk management should be done to mitigate risks our business faces as opposed to doing it because some compliance or regulation asks us to. Needless the say few organizations have been able to create a good balance between risk management view and compliance view.
Now the link between the curse of compliance and China! China is very keen to develop its ability to provide global BPO and KPO services; they see India as a world leader in this space and want to come close to India as early as possible. There are Government agencies that have been specifically setup to achieve this and they are driving the Chinese companies towards this goal. E.g. The Government is developing 20 provinces and providing all kinds of facilities like infrastructure, power, education, tax breaks etc. I think of this as an “Inside-out” view. I call it that because the “inside” the Government (people) wants to do it.
A good example of this is when I tried for a direct flight between Bangalore and Beijing; I was told that Air China has a stopover at Chengdu, a place I hadn’t heard of. I learned later that last year Wipro started a development center in Chengdu!
When the ITES/ BPO industry developed in India, the industry or companies had to convince the Government to make policies that help the Industry and provide support, which it did. This was opposite to what’s happening in China and I call it as “Outside-in” view. “Outside” since the market had asked us to do it.
Which approach would win? India has a big lead over China in the ITES/BPO space hence direct comparison may not be possible, maybe we will never know the answer. However the “Inside-out” approach of China seems to be helping them in other areas. An example is that China has the largest network of high speed rail in the world. They have an ambitious program to have 16,000 kms of high speed rail lines by 2010. I read articles which argued the utility of the high speed rail systems as the common rural population in China can’t afford it. However this has positioned China as the world’s leader in high speed rail technology and is getting contracts from countries such as Saudi Arabia.
Back to security, I think of compliance way as “outside-in” view and the risk management way as “inside-out” view. In theory “inside-out” view seems to be more sustainable and “right”, however I am not sure if the “curse of compliance” will allow us to think and act that way.
It looks like a victory of the “real” over the “right”.
No writing about China can be complete without the mention of “IP” protection. I am no expert in this area; however I did find a shop selling an “ipad” running cracked android OS at less than US $80!
