Remember Y2K? That was the “millennium bug”, the software glitch that threatened to melt down millions of computers when their internal clocks tried to roll over on 1 January 2000, because they were not designed to handle that new date.
And remember that the only country that had enough software programmers to adjust all these computers so they wouldn’t go haywire, and do it at a reasonable price, was India. And remember that it was this huge operation that launched the Indian outsourcing industry—which is why I have long felt that Y2K should be a national holiday in India.
Well, remember this: There is an even bigger opportunity for India than Y2K waiting around the corner. I call it “E2K”.
E2K stands, in my mind, for all the energy programming and monitoring that thousands of global companies are going to be undertaking in the early 21st century to either become carbon-neutral or far more energy-efficient than they are today. India is poised to get a lot of this work.
I first started thinking about this when I heard Michael Dell declare that Dell Inc. would become “carbon-neutral” in its operations by the end of 2008. He said Dell would take inventory of its total greenhouse gas outputs and then develop plans to reduce, eliminate or offset those emissions.
With a carbon tax or cap-and-trade legislation looming, every day you are going to see more and more companies doing the same thing. It is going to be the next big global business transformation. And it’s going to require tonnes of software, programming and back-room management to measure each company’s carbon footprint and then monitor the various emissions reduction and offsetting measures on an ongoing basis. Guess who’s got the low-cost brainpower to do all that?
Some of the smartest Indian outsourcing companies are already positioning themselves for the E2K market.
“What did Y2K do?” asked Nandan Nilekani, co-chairman of Infosys Technologies Ltd, one of India’s premier outsourcing companies. “It was a deadline imposed by the calendar and, therefore, it had a huge ability to concentrate the mind. It became a drop-dead date for everyone. Making your company carbon-neutral is not a date, but it is an inevitability.”
When Y2K came along, some companies responded tactically, doing only the minimum reprogramming to keep their computers operational after 1 January 2000. Others approached it more strategically, saying: “Since we’re going to have to go through all our software anyway, why not just retire all the old stuff and upgrade to the newer, simpler systems that will make us more efficient.”
These companies went from seeing IT, or information technology, as a cost to looking for ways to make money from it—through data mining and using better information to cross-sell products, reduce cycle times for introducing new services and to manage inventories more efficiently.
The key to winning E2K business for the Indian outsourcing firms, said Nilekani, will be showing big global companies, such as Dell, how becoming more energy-efficient or carbon-neutral doesn’t just have to be a new cost they assume to improve their brand or satisfy regulators, but can actually be a strategic move that makes money and gives them an edge on the competition.
“The strategic companies will say: ‘We are stuck with this problem—why not take advantage of it and use it to revolutionize and rejigger our whole energy infrastructure?’” added Nilekani.
They will use ET—energy technology—“to reduce material costs, simplify logistics, drive down electricity charges and shorten supply chains,” he said.
As they start to do this, it will require a lot of data management, which companies will want to do as cheaply as possible. Hello, India. Hello, E2K.
“My impression is that there is certainly a significant opportunity for Indian outsourcing companies,” said B. Ramalinga Raju, chairman of Satyam Computer Services Ltd, another top Indian outsourcing company, adding that the precise size of that business will depend on “the speed and scale at which the carbon neutral policies are adopted by the global companies.”
To better compete for such business, Nilekani is installing solar systems and other efficiency technologies at Infosys’ Bangalore campus. Satyam is planning to do similar things with its verdant Hyderabad complex, which already has its own zoo.
IBM Corp. seems to be moving into this space, too. Big Blue knows that even if Indian companies do a lot of the back-room work, there will be lots of front-end jobs nearer the customers.
So, mom, dad, tell your kids: If they’re looking for a good stable-growth career—green consultants, green designers, green builders are all going to be in huge demand. And if they can speak a little Hindi—all the better.
©2007/THE NEW YORK TIMES
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