Idea Exchange

‘We must make collective efforts to fight the menace of Internet abuse’

Idea Exchange is a forum for leaders in the IT industry to share their perspectives on what make them and the industry such dynamic drivers of growth and excellence. With a varied audience of IT journalists across channel, enterprise and trade verticals, Idea Exchange serves as an ideal platform for IT leaders to put forth honest opinions and genuine insight.

Contrary to popular perception, Ninad Karpe, Managing Director, CA (India and SAARC), believes that large enterprises offer a greater sales growth opportunity than small and medium-sized enterprises. Once a practicing chartered accountant, Karpe used to help MNCs set-up shop in India. In an interaction with Indian Express group publications, Express Computer, Express ChannelBusiness and Express Intelligent Enterprise, moderated by Tushar Burman, Associate Editor, Express Intelligent Enterprise, he spoke on various subjects ranging from business, industry trends, social issues, and his favorite hobby, winemaking.

(From left) Ninad Karpe, MD, CA (India and SAARC) responding to a question by Tushar Burman, Associate Editor, Express Intelligent Enterprise

How do you feel being at the Idea Exchange forum today?

I get several proposals from the media. Everyone wants to do something new. But just because something is new it may not be qualified as a good idea. Idea Exchange is new, refreshing and an interesting project. I am personally excited about it.

Computer Associates (CA) has been at the helm of IT management for several years now. How do you perceive the evolution of the concept over the years?

The criticality of IT management has increased over the last few years. Let me give my own example. Five years ago, whenever my coffee machine or the A/C did not work, I would start screaming and feel upset about those things. But today, I start screaming only when my e-mail does not work or if the Internet is down.

On a serious note, this shows that IT has become an extremely important part of our lives. And this places pressure on IT management to ensure zero downtime. Take the example of the changed banking environment. Earlier, people would wait at the counters for hours just to get their passbooks updated. But today, they expect smooth functioning of ATMs and get frustrated when there is anything wrong. IT management has become critically important to organizations.

Over the past few years, several players have emerged as competitors to CA. What do you think of this competition?

The market has been growing and that has led to competition. I feel competition is good; it helps you to improve. It benefits everyone as it helps one to be alert and keep growing. Having said that, I would like to highlight some differentiators between us and our competitors.

The competitors have been trying hard to absorb all possible revenue by entering all product-lines. Under CEO John Swainson's leadership, we have consolidated our focus. Swainson has prepared a plan for the next three years. We have rationalized solutions under a single EITM (Enterprise IT Management) umbrella and have exited all those areas that are not core to our strategy. For example, we sold out ACCPAC as it was not a core area for us. This focus makes us stronger than competitors.

How large is the management software solutions market in India and what is the scope for these products in the SMB segment?

Different people have different estimates about the size of the market. It's difficult to put a number to the size of the market, but we can say that it is somewhere around 20% of the IT infrastructure market.

The SMB is certainly an emerging opportunity. However, the current available market and growth are concentrated in the enterprise segment. The large companies in India have a larger investment and growth appetite than the smaller ones. Even SMBs should be classified into those which are globalized and those that are not. The globally connected SMBs follow best practices, comply with international standards, and therefore invest in IT management. However, the small companies that do not have any external linkages, do not consider it exigent to invest in IT management.

There is another angle to this. Our products come with several modules. An SMB may go for individual modules and be benefited by them. However, these modules, when deployed as standalone tools cannot offer 100% benefit as they can when deployed along with the other modules within the product. However, we do have affordably-priced SMB-packs.

Questions pouring in from the editoral team, hi-tech, Business Publications Division, Indian Express

How much of your business comes from the government vertical?

The government sector in India is diversified. It includes central and state government bodies, municipalities and other local bodies in addition to PSUs. The Government contributes 30% to 40% to our overall revenues in India.

Which verticals do you consider as hot and which do you consider as emerging?

The IT needs of all verticals are growing. BFSI is the breadwinner for lots of IT companies. The next in line is telecom. The other two-manufacturing and healthcare-look like emerging verticals. It is just a matter of time before these verticals will start investing in IT management. Indian companies in these two verticals seem to have the highest growth appetite in the world. Pharmaceutical companies have already made investments in automation; the new hospitals are setting up their IT infrastructure, and the environment looks conducive for IT management.

What did you learn from CA's Sanjay Kumar controversy?

In the Kumar case, CA admitted its mistake and brought in a new management team. What I learnt from the controversy is that it's always best to admit your mistakes and move on.

How critical is the partner community for your business?

CA's go to market strategy has undergone a major shift. A few years ago, 80 percent of our business was direct and the rest 20% was through channels. Today the picture is exactly the opposite. We have a separate channel team, a channel program, and a well-established network of partners. The channels are responsible for 80 to 90 percent of our sales.

What are CA’s future plans?

We have a focused business plan in place. We have set ourselves the task of doubling our revenue every two years. This will be possible only if we have good solutions, partners, employees and if customers are happy.

What has been the impact of the slowdown in business in the US?

There may be some impact on the IT infrastructure companies, especially in the BFSI sector. However, when it comes to our business of IT management products, the impact is minimal if not zero. IT management is critical to customer organizations regardless of whether there is a slowdown or not.

CA opened an R&D center in Hyderabad last year. Could you tell us how much you have invested in the facility so far? Which products or product-modules have been developed at the Indian center?

The center was opened last October and the team-size has grown to 1,500. Of the total investments of CA in R&D, 30% go into that center. One thousand five hundred is a fairly large number. The India development center has been working on almost all projects. It is one of the largest developer sites that we have outside the US.

Why did you leave your own flourishing consultancy practice to join Computer Associates?

Post-liberalization, several MNCs were looking at entering the Indian market. They knew that India had great potential but needed help to set up their operations here. As a consultant, I helped such companies to set up shop in India. The job involved helping them with the local rules and regulations and assisting them in making business projections. CA was my client then and asked me to set up the business here. It is only once in a lifetime that you get an opportunity to start a new venture. I was going to function like an entrepreneur. It was a challenge and therefore I took the offer. In hindsight, I feel it has been a good journey. Being part of a corporation allows you to do many things that as a consultant you cannot. I have enjoyed every moment of my life being a CA official.

Being a non-IT person, was it not difficult for you to adjust to the IT sector?

I feel fear is in one's mind. A business is a business, whether IT or non-IT. It's my experience that when you go to sell anything to a CEO of a customer organization, he is afraid of IT jargon. However, he understands business and sanctions projects only when the business benefit of the project is visible.

Having been a qualified chartered accountant and a consultant, I understood the compulsions of the CEO better and not having IT background, in fact, helped as I could stay focused on business. Having said that, I would like to add that business is not run by one person and in our company, there are several domain experts who take care of taking forward the technology business.

Most IT companies are faced with the issue of employee attrition. What do you do to retain employees?

Employee attrition is present in organizations of all sizes and across industries. For example, my wife is in a school and she tells me that attrition is a problem even there.

I personally feel that very few people leave organizations solely for monetary reasons. It is more to do with responsibility, respect, and the excitement and enjoyment that the job offers or does not offer. At CA, we try to ensure that employees have a good work-life balance. Even small things like recreational activities such as games, quizzes, and family functions help achieve that balance.

What's exciting about the work environment in CA?

As I said earlier, in CA we try to be like a large family. We carry out several activities throughout the year that keeps the workplace environment exciting and enjoyable.

For example, last year, we started an initiative of ‘Coffee with Karpe’ modeled on ‘Coffee with Karan,’ and I met every CA employee, from an entry-level executive to a top manager, in person, to discuss everything that concerns her or him. The exercise serves two purposes: I know what the employees want and employees feel good because the company CEO wants to know about them, their likes, ideas about work, etc.

We also started another program-’Dabba Gul’, where no employee is required to bring lunch boxes on one Friday. The company offers different types of cuisine to all employees. For instance, the other day, we had Lebanese food. We continue to think about how we may make the work routine more interesting and fun. Another initiative we ran last year was Surprise September, by which there was a surprise waiting at the office for every employee, every day. It may be a quiz with prizes for winners or other such activities.

How do you allocate time for your family?

One thing you must realize is that my story may not be too different from most people who live urban lives. The routines of all of us who live in the cities have become tight. Being MD of the company, my time is taken by others continuously. I cannot say 'No' to them, as they come to me for important work. But that's part of my job and it places immense pressure on my personal life.

I strive for some work-life balance, but frankly it is not easy. There is no textbook answer to it such as, "I ensure I spend quality time with my family". But I do try to maintain that balance by taking interest in the activities of my family members. For example, one of my sons is interested in Astronomy. As a result, even I have started reading about the subject. Similarly, my family is involved in my hobby of winemaking. When the entire family has similar preferences and interest areas, it's easier to maintain a work-life balance.

You have a rare hobby of winemaking. How do you find time for this without sacrificing work or family commitments?

It's been for the last 10 years that I have been cultivating this hobby. It is an expensive hobby to have, but which hobby isn't? I do not make wine in huge quantities; it's usually a single jar or so. I feel fascinated by the process of grapes or any other fruit turning into a liquid substance. I don't do it daily or weekly but once in six months or once in a year and fortunately my entire family-my wife and the two kids-gets involved in the process. Because of me, one of my sons has started taking a keen interest in the subject. Thankfully, today even doctors have started saying that wine is good for health.

You have another hobby of videography. Can you tell us about it?

I am an amateur videographer. I shoot wherever I go. With time, I have started learning about it. I am planning to put small, two-minute videos on YouTube some time this year. These videos will be on various subjects, for example, on Mumbai's city-life.

As an executive heading an IT corporation, what are your thoughts about Internet abuse and its impact on children?

It's a serious issue and we must become sensitive to it as a society. I am the father of two children and I already sense how important it is for parents to ensure that their children do not fall prey to Internet abuse.

Although I head an IT company, I am well aware of the limitations of technology when it comes to protecting children from Internet abuse. The next generation is IT savvy and intelligent. They can easily discover the loopholes in IT tools and still engage in dangerous activities on the Internet. The solution is not technology but societal; parental efforts to educate children about the damage that Internet abuse may cause to their lives. Although it is an important subject, very little is spoken or written about it. Fighting it will require an educational effort where all of us-the parents, the teachers, the police, and the media, have to contribute.

(The transcript was prepared by Vinita Gupta)