The theme of the talk was Transformations: Technology. India and the Law and Samuel charmingly blended his undoubted legal expertise with acute personal observation to highlight how radical technological and economic changes are outpacing the legal infrastructure, creating fundamental changes in Indian society and informing how the Indian outsourcing industry works with its global partners.
The talk was roughly divided into two parts. The first half concentrated on three specific examples of the technological trends and projects – the Bhoomi Project, E-Choupal and marriage web sites – that are driving social changes in India.
The Bhoomi Project is an attempt to settle title rights in Samuel’s home state of Karnakata. Until this project, title rights across India were subject to archaic personal and religious laws – land grabs are common and the courts overflow with litigation. Under the Bhoomi project, 20 million land records of 6.7 million landowners have been digitised. The title owners can claim their records using bio-logon software (a fingerprint replaces a password) at kiosks throughout the state for about 15 rupees. Samuel applauded the project as a real example of the common people seeing the transformative effect of IT and as a means to combat poverty under the principle put forward by Hernando de Soto that poverty can only start to be eradicated when secure land rights are in place.
E-Choupal is an initiative funded by the India Tobacco Company (a subsidiary of BAT) to help them secure the best price for buying soya beans and other commodities directly from rural farmers as they diversify their business away from cigarettes. Farmers using the e-Choupal system can see current market prices and sell directly to ITC, thus ensuring that both they and ITC get the best price. Prior to this initiative, produce had to be sold through official markets, so considerable lobbying was undertaken by ITC to clinch the required legal changes.
As a social trend, the explosion of arranged marriage web sites, which have become popular as the old ‘real’ social networks of the traditional family wither (although Samuel noted wryly that his mother was a ‘mainframe’ of familial ties and history) is also to be reckoned with. Some of these sites now store the personal data of over 20m users, which is remarkable given the frightening absence of adequate privacy or data protection regulation and while current attempts to address this problem are falling well short of what Samuel believes is required.
All this set the scene for Samuel’s insights into the Indian outsourcing industry and how it contracts with partners around the world. First he demonstrated the industry’s phenomenal growth and its impact on the Indian economy, which he admitted he had been very fortunate to enjoy as he was in the right place at the right time. When he joined Infosys in 2002, his employee serial number was 19,000 – a colleague in the audience has a number above 140,000. Even given some drop off, the Infosys payroll now stands at roughly 110,000 and it is only one of 5 or 6 similar size organisations. This year they are expecting to take on another 25,000 employees (from 1m applications) and, when you consider that that each new outsourcing job created leads to 8 further new jobs in the local economy, the exponential impact of this revolution can start to be appreciated.
Samuel then surveyed some of the contractual characteristics he has noticed when working with companies in different jurisdictions. Graciously, he conceded that UK companies were the best to contract with; he liked the traditional pragmatic approach. However he voiced concern that the more proscriptive US approach is gaining favour. In his view, the Australians have the most aggressive attitude to negotiations.
Samuel also attacked the popular myth that most IT outsourcing projects fail. Outside of transformational projects, Infosys has 90% repeat business rate, aided perhaps by the sophistication of the clients with whom he contracts. Where projects often fail, and what drives him ‘nuts’, is when clients seek to decrease their responsibilities too much. For example, outsourcing IT to Infosys and sacking the entire in-house IT team will invariably cause problems because of the essential business knowledge lost on the departure of the old team. As one extreme example, he recounted the tale of a client requesting a knowledge transfer clause but disclaiming any responsibility for actually doing anything to achieve that transfer. This disclaiming attitude is often at odds with the traditional Indian approach, which is to throw manpower at a problem for free, though as the industry matures that USP is being diluted. Sadly, clients will lose out in the future.
All in all, though, Samuel still feels that the UK still has the opportunity to lead the way in developing contractual frameworks that retain the pragmatic approach to the business deal.
Some intriguing questions followed the talk on the possible use of collaborative relationship models, open source documentation (of which he was wary) and the future of data protection legislation.
The Lecture is now available as a podcast on this site. All those interested in understanding how IT can change both law and society – and of course, anyone contracting with India now – would do well to catch it when they can.
