RPA’s Promises & Realities


When you travel through the froth, reach to the core and witness the reality, RPA does not look like what you were told by the Sales reps and the Service providers. RPA as a concept certainly got a potential for cost savings. Is RPA useful at all? – Yes. Should you look at RPA? – Yes, you must. Can you eliminate dependency on Technical People and let Business Subject Matter Experts automate the processes? – A resounding NO. Can RPA use an App Store? Yes, Yes and Yes. These are RPA’s promises and realities – RPA minus all the BS built around it. RPA vendors must concentrate on building a highly extendable and customizable platform not the individual skills. Although vendors can build a few necessary skills, it must be the job of developers

If you are a pragmatic person and keen to produce value with everything you do, you want to understand a concept or a technology for its true worth. Because of the forth created by Marketing people, this info is unavailable in ready-to-consume form. This article is intended to process all the crude info that’s freely available around RPA and get to the core of what it is truly capable of – at least as of today. If you are new to RPA, please refer to my previous post to get an idea of what it is.

RPA is incapable of empowering business subject matter experts to automate without the help of technical people. RPA is a platform that comes with a suite of tools that make automation possible. However, the current platform and toolset are inadequate and unreliable to achieve this technical independence. Here is a list of ares where I think the problem is.

Openness

Openness is my big concern with RPA. Currently RPA products are mostly closed environments. The vendors look at them as a platform that does not need to integrate with other non-RPA systems. If the vendors do not open their platforms up to other systems, it would be a disaster for them. For example, ability to trigger an automation task – may be exposing the script as a REST endpoint, ability to share application context or transaction context among RPA and non-RPA systems, ability to pass input/output parameters with native datatypes instead of passing through files – pass an array of integers vs writing the integers to a file and pass the file as input etc.

OS Openness

Most of today’s RPA products can run only on Windows machines. This means irrespective of your IT policies and guidelines, you are forced to use Windows servers(or desktops) to run RPA. For a few organizations that would be a showstopper.

For a few vendors, this restriction is partly caused by the technologies they used to build the product itself. For example, if a particular vendor’s RPA product is built using .NET framework, it cannot run on non-Windows platforms. Some of the RPA products heavily rely on Windows internal libraries directly (instead of abstracting it out) to achieve majority of the system level work. This is another reason why they cannot be ported to other platforms easily.

Code Openness

Most of RPA products allow you to write custom code and run them along with other standard activities. Technically they can allow this custom code to be written in any language and still be able to run it with proper execution environment – whether they ship the environment along with the product or provide a way to the admins to install and configure it. In my opinion, this is a great opportunity to RPA vendors to open up their environment. But most of the RPA products allow only one or two scripting languages to write libraries in. VBScript, JScript – are you really serious, guys? This is 21st century AND we are 17 years into it already. Wake up !!! No technology can have mass adoption without support of developer community. This is the way RPA vendors to get the much needed support from developers – support as many programming languages as possible to implement custom functionality

Platform Openness

In general, RPA platform itself is very closed. For technical people, developing automation scripts with RPA products is nothing less than torture. For example, the script you compose through dragging and dropping a few activities cannot be hand edited – Behind the scenes this script is nothing but a bunch of commands written in a sequence. However, most of the vendors won’t allow you to edit this script by typing. If allowed, this would help developers save a lot of development time. The scripts are stored in proprietary binary formats. This is a lot of inconvenience that could be easily avoided by exposing the textual format of the script to developers. Even if the targeted audience to these editors are non-technical people, RPA vendors can support a developer mode of the editor which will allow developers to do more sophisticated development – one solution does not fit all.

Open for extension – App Store

No general purpose platform can claim that it supports all the use cases that are ever possible in the world. Even packaged solutions such as SAP FI/CO or SD which are built for specific domains need customizations and enhancements for real world scenarios. How can a generic platform like RPA which claims to support any domain – whether it be finance or energy or any other thing in the world – think that the standard tool suite provided would be comprehensive enough for all real world use cases? This problem can be solved by an App Store – Let the developers around the world build general purpose and specific purpose automation tools that can be seamlessly plugged into the RPA platform.

Compound Deployment Artifacts

Today all RPA vendors expect automation scripts to be single files. I think for any serious real world usage, you would build a bunch of reusable libraries which can save developers a lot of time. Although building reusable libraries is possible today, there is no proper way of packaging a script along with all the required libraries. Support for building compound deployment artifacts is necessary. Think of a script as a bunch of files that are packaged into a deployable package.

Reliability of Tools

Although there are a lot of tools – such as Web Scrapper, OCR, PDF reader – shipped with the RPA platforms, they are unreliable for real world scenarios. For example, PDF reader let you highlight a text and copy it – but few products let you specify which page of the file this text is expected to be found or which pattern should be used to identify the text etc. This information will be implicitly determined by the tool itself. The problem with this approach is, the script developer won’t have any control on influencing the decision except he/she will highlight and copy and product will figure out the pattern. In real world, this approach won’t work very well. For example, for all PDF’s the text may not appear at the same location on the same page – if not, then the script will fail. Similar reliability issues are present with other tools too. Again the solution could be to build an adaptable UI so that if the developer wants to work with the script at a higher level of sophistication, they can. RPA vendors must not keep the control with them – they must give it to the developer/implementer.

Cloud & CI/CD Support

It’s mostly safe to say that RPA vendors are not cloud ready yet. It seems they don’t have a proper plan to support Continuous Integration and Deployment also. Although you may achieve this today, it would prove to be a Herculean task.

Closing Remarks

RPA vendors must concentrate on building a platform that’s extendable, optionally customizable and can plugin and naturally play any custom built skills. Let the developers around the world build the skills. If they try to eliminate the developers from the equation, RPA will be a disaster and will bite the dust. Who knows what Artificial Intelligence would be fully capable of. Until AI proves that it’s feasible to eliminate coders, RPA should NOT assume it. As it’s today, RPA is an Orchestrator that can create symphonies by leveraging several individual skills that are part of or plugged into the platform or running externally somewhere on the Internet. Building the platform in such a manner could be the recipe for success. Openness alone can dictate the fate of RPA as a technology (or as a concept). The more open you are to the world, the more open the world is to you.

PS: Please leave your comments and share your views. Thank you.

Entering listen mode … Krishna Pisupat

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Robotic Process Automation – Myths and Facts


Robotic Process Automation – How robotic it is and how novel the technology is? Are “bots” really software robots? What RPA means to Business personnel, Technical people and Corporations. Where does it meet Artificial Intelligence today? How well would it be married with Artificial Intelligence tomorrow? If you are on Business side or Technical side, how exposed are you to RPA disruption and how can you be prepared for it and leverage it?

There has been a lot of buzz around Robotic Process Automation (RPA) off late. If you are new to this concept and technology, you would wonder what it is. From the name you may tend to think it’s something to do with Robotics. From all the buzz around Artificial Intelligence in conjunction to RPA, you might even think it’s related to Artificial Intelligence. Let’s see what is myth and what is fact.

What is RPA?

To understand what RPA is one needs to understand what a process is. Any sequence of steps that are performed to fulfill a business need is a process. Generally a process includes the real recipe of the process – steps to achieve what is really intended to achieve, a few best practices, a few regulatory and compliance stuff, creating audit trail etc. For easier understanding let’s take something more concrete.

You are applying for a credit card with a credit card provider. You fill the application either online or through a paper application. In either case, an associate of credit card provider has to validate all the furnished information for completeness and correctness – whether you provided your first name, last name, address, annual income and finally whether you signed the form or not. Then run a bunch of verifications and validations such as background and credit checks. Finally enter all these details in a system and run a risk model that determines your eligibility and credit limit. The whole sequence of steps is a business process.

In a non-RPA world, all or some of these steps are performed by a human. Of course, in a digital world, most or all of these tasks can be done programmatically. You can build a web application so that customers can apply online and a business process can be built with one of those well known BPM (Business Process Management) systems. If all the process can be automated by a BPM system, what’s the need and role of an RPA system?

That’s where things get interesting. Let’s jump to the real world. Unless we are talking about a new organization that’s completely built ground up for this use case, the above automation is often an integration project among several in-house and third party systems. For example, credit check is often provided by a third party application which will be invoked by the credit card provider. Whenever we talk about Integration, there is a lot of complexity, confusion and cost involved. Integration generally requires both the service provider and consumer to agree upon a few protocols and standards. On top of that, there are software development costs for both the ends. Also, not all applications are integratabtle as a few are legacy or extremely complex systems – a few applications won’t even have an API which makes it impossible to integrate with them. Even BPM cannot help in these situations. In some cases even if you can leverage BPM, these projects are so costly that there won’t be any ROI (positive cashflow) after factoring in the software license, development and maintenance costs.

With RPA, most of these issues are solved in an economical way. RPA is NOT a single technology. Instead it’s a collection of tools a few of which have been in use for more than a decade. A few tools that are integrated in RPA platform are

  • Record and Play tool – Records what a human performs and repeats it any number of times. Of course you can customize it so that each run can be performed with a different data set. If a human copies a row of excel spreadsheet and pastes in a form on a web page, this tool can simply repeat the same task – it opens the excel, highlight the text, copy it, open browser, log on to the application, navigate to the intended page and paste the content in the correct field of the form
  • Web Scraping tool – Reads a web page and extract content out of HTML
  • Other content extraction tools – Extract the content from spreadsheets, PDFs and images using OCR (Optical Character Recognition) techniques etc.
  • Rule Engine – Allows users to write rules which dictate the conditions to all the above tasks when to run and when not to run. Validations and verifications can also be performed by a rule engine.
  • Orchestrator – Helps to build the sequence and flow of tasks to determine execution order

If you are familiar with any of the automation testing tools, record and play and site scraping tools must be well known to you. Using these tools, one can mimic a human being with out doing any integration among disparate applications. As a result, any application – whether it has an API layer or not, it’s developed using a new technology or not, you can integrate it with an RPA application. In fact, even the application provider would be unable to identify whether a human is performing these tasks or a bot is performing them – of course a few sites build captcha and similar techs to avoid bots.

For BPM professionals, rules engine and orchestrators are inevitable tools. These tools help to provide order and conditionality to an RPA bot.

What RPA is NOT?

As it’s today, RPA does NOT leverage much of Artificial Intelligence or Machine Learning. Most of the out-of-the-box RPA products do NOT have this integration yet. If you ask me whether RPA is any Robotic, my answer would be a big NO. Of course, what you build with RPA could be eligible to be called a “bot”. But beyond semantic meaning, it has nothing to do with Robotics.

As it’s today, most of the vendors’ bots are run independently as isolated processes. Probably at some time in future, they have to be invocable from other software products so that they can be launched on-demand and as part of a larger business process that involves non-RPA systems.

What it means to you?

I hope, by now, you got a conceptual view of what RPA is and what it is capable of at a very high level.

Business Personnel – If you are a business personnel who performs any repetitive tasks which are mundane and require a little or no business knowledge, it’s possible you may be replaced by a bot as of today.

If your job needs simple to medium level of business knowledge that can be encapsulated into some kind of structure and logic, you might be taken over by RPA as well. RPA technology as it’s today can perform your role very well.

If you are a Subject Matter Expert in a business area and it takes a lot of learning to reach where you are, then you are safe for now – at least until RPA integration with Artificial Intelligence is improved.

Technical Personnel – If you are a BPM professional, you may need to learn RPA soon. I believe, this is the skill that could be at risk because of RPA to start with. RPA is a natural evolution for you.

If you are a software programmer, you should be worried too. RPA cannot replace all software projects. However, some of the projects that would have been developed in traditional ways would now be developed using RPA. It means less demand for Software Programmers.

What’s the bright side?

Business Personnel – RPA truly empowers business personnel to take the control of automation. Your Subject Matter Expertise could still be appreciated. You don’t have to rely on Technical personnel as much as you used to. Significant portion of RPA implementation requires a little or no technical knowledge. It means, if you are willing to learn RPA, it would be actually a boon to you. Just to clarify, you don’t have to learn writing software code but you can implement at least half of automation yourself.

Technical Personnel – RPA is nothing challenging given your technical background. Learn it today. You can still share half the automation pie. Not all of the automation is programming free. You still need to implement some complex logic through scripts and programming. On top of it, maintaining, monitoring of RPA environment would still require technical expertise. Join all of this with Analytics and insights – you see a bright spot on the other side of the tunnel.

Leadership – There is a lot of cost cutting waiting for you to grab. Jump into RPA and adopt it. It could mean a very fat bonus for you at the year end.

Closing Remarks

I don’t put RPA and Artificial Intelligence in the same bucket as of today – they are two different worlds. On the contrary, RPA has nothing intelligent in it. However, it’s only a matter of time before they complement each other.

Nevertheless, RPA is going to be a disruptor if it’s not already. There is still an early mover advantage on the table if you are ready to adopt it.

PS: I welcome all constructive comments. Please feel free to leave them here. Thank you.

HuMachines(2) – Augmented Humanity


“Is an entity Human or not?” – would this be a classification problem or a regression problem? Classification says either Yes or No where Regression says what percentage of the entity is Human.

In Part 1 the Narrator felt the person who helped him was a Human Being based on Looks, Abilities, Knowledge and Emotions. Let’s see how Looks alone may not be able to distinguish between a Robot and a Human.

If you were to identify a human, firstly you would depend on physical appearance of the person – Legs, Hands, Head etc. Current technology is either already providing alternates to human organs or close to provide them.

We can categorize Human organs into to two types

  1. Organs that are required for the body to function but are invisible to others
  2. Organs that perform actions and/or are visible to others

For example, heart is a vital organ of human body. However, heart’s role is just a supporting role. Heart purifies the blood and re-pumps it to the other parts of the body. However, if there is no need for blood or there is blood that does not need purification, probably heart would NOT be needed. Similar argument holds good for other inner parts such as Lungs, Intestines etc. All these supporting organs are not visible to outside and hence do not play any role in distinguishing between Humans and Machines.

Most of the inner organs’ role is to produce energy needed by the human body from the food the body consumes. If we can supply the needed energy through some source of energy, then we wouldn’t need any of these organs.

Regarding the outer organs, there are artificial limbs that are already in the market. There is research going on to produce artificial skin – that looks like human skin. It’s simply a matter of time to produce a human look alike Robots. There are already a lot of success that’s achieved. Refer to this News item http://www.telegraph.co.uk/science/2016/03/12/meet-nadine-the-worlds-most-human-like-robot/

Now we saw how a Robot can be made to look like a Human. Is it possible to Augment Humans with Artificial Organs? There are researches going in many Universities and Institutions on 3D Printing of human organs. Using bio-ink filaments – think of these are cartridges filled with Stem cells, we can print human organs. Although this is only a partly proven technology as of now, making fully functional human organs is only a matter of time. On the other hand there are attempts to design chips that perform human organ functions – A Heart on a chip. Check this link https://www.seas.harvard.edu/news/2016/10/3d-printed-heart-on-chip-with-integrated-sensors. Using similar techniques, it would be easy to manufacture human organs like instruments, that perform what these human organs are supposed to perform.

Let’s take a metallic Robotic human like Chassis. Add artificial human organs that are manufactured somewhere on a factory assembly line. You end up with something that looks like a human except that the internal organs are invisible to you and they may be a bunch of wires and circuits. On the other hand, take a human and augment that human’s natural abilities with artificial tools that act and look like human organs.

When a Robot can be designed to look like a Human and a Human can be augmented with Technology produced artificial organs, the result of both would be something that’s between Humans and Machines. Where do we draw the line? Does the baseline that we started off of – a robot chassis vs a human body – defines what the resultant entity should be called?

One thing is certain. The question of answering “whether an entity is a Human or not” has been an Yes or No question – in other words a Classification problem. Soon it will become a Regression problem which says how much percentage of the entity is Human.

If the Looks alone aren’t enough to make the distinctions, can the Abilities – what an entity can and cannot do – or the Emotions make the distinction?

HuMachines – Humans, Machines, MacHumans or HuMachines? – Part 1


https://www.linkedin.com/pulse/humachines-humans-machines-machumans-part-1-krishna-pisupat?trk=hp-feed-article-title-share

What make Humans Humans – Cognitive Abilities such as Learning, Understanding, Reasoning and Decision Making or Senses and Emotions or the Bodies composed by Trillions of cells? Whatever has been the line of separation until now, it would soon become inadequate to resolve the ambiguity. Recent technological advancements are going to erase these boundaries.

It’s been drizzling. It was around 6 PM on a Christmas Eve at the foothills of Smoky Appalachian Mountain range. My car was racing towards my home town. I was overwhelmed by the idea that I was about to share my breakthrough discovery with my family. Then suddenly my car started losing momentum and the engine shutdown. I came out from my thoughts and anxiety and steer the car towards the Shoulder. Within no time it came to a complete stop. I was clueless what to do. There was no one around as far as my eye can see.

Then there was a noise that I felt was approaching me. I was scared – what if that was a Bobcat or something. Slowly, it became inaudible to vague to clear. It sounded like a car. Hmmm…. I cried a sigh of relief. Then I stepped out of my car and tried to stop the car, expecting a ride. The car stopped around 10 meters away from me. I approached the car and peeped through the car window. There was a beautiful Lady with blond hair and blue eyes. I explained my situation to the Lady. She readily understood the situation and expressed her sorry to my situation. She seemed to be a sensible person with helping nature. Although I was a stranger to her and trying to stop her car in the middle of a Jungl-ish place, she was undeterred to offer me the ride. I felt she must be brave to offer me a ride to a near by town. I asked myself, “Would I offer a ride to a HitchHiker midst of these situations?”. The Answer was No. While brain was puzzled with these thoughts, I took my luggage and got into the car.

After basic introductions, the conversation went on to our professions, interests and then a few general topics like Technologies, Finance, Economy etc. The whole episode made me feel that I found a good friend as there were a lot of similarities in our expertise and the knowledge we both possess. I had not met anyone before who is such a trove of knowledge in one of the most advanced and niche areas of Quantum Physics. No wonder of my knowledge in such a remote area as I am Doctor of Philosophy in Quantum Physics and the topic has been my research area. I published most of my research papers on the subject. But how can she possess knowledge about those nuances at great depths. Honestly, I was amazed. She sounded knowledgable in every topic and discipline we discussed in that one and half hour drive. In addition to her helping nature, concern and knowledge her good looks and well balanced composure made a lasting impression on me. I would, any day, be ready to meet her again. I felt that she was warm and trustworthy.

*************************************************

If we abstract out or eliminate the whereabouts and other details of the plot, there was a framework that the Narrator’s brain used to read the whole experience. When his car broke down, he heard a sound that scared him. He was the only person around – at least as per his knowledge. He suspected something dangerous to be lurking around. When he heard the car, he felt some Human was approaching. An alternative possibility was not even in his consideration as it was beyond his doubt that only a Human can drive the car.

During the conversation, the Lady expressed a few emotions and words to back them. Her expressions, body language and words made him feel that she was kind hearted and brave to offer him the ride.

During basic introductions, both exchanged their information about their professions, interests etc. Then the conversation went a bit deeper to his interests and research area. His brain started considering her to be someone with good heart. He stopped feeling that she was a complete stranger to him. Because of a lot similarities, his psychology made him trust her and like her.

To brief, here are the things that made his brain used to conclude the specifics of the Lady

  • Abilities – Lady’s ability to drive the car; On hearing the car noise, he readily felt that it was some Human Being
  • Looks – Her looks impressed him and as she was beautiful.
  • Emotions – Her facial expressions, language she used, her compassion towards him made him feel that she was a kind hearted and brave person
  • Knowledge – As she talked about his area of research, he started treating her to be close to him professionally – i.e. to be an insider. He started connecting him to her professionally.

In this whole plot, Narrator didn’t even consider the possibility that she could be a Non-human entity. The above criteria made him to conclude that she was a human being. If you were to decide yourself, would you think that she is a human? What if we are in year 2030? Would you still stick to your conclusion? Or would you consider any additional criteria?

“What make Humans Humans – Cognitive Abilities such as Learning, Understanding, Reasoning and Decision Making or Senses and Emotions or the Bodies composed by Trillions of cells? Whatever has been the line of separation until now, it would soon become inadequate to resolve the ambiguity. Recent technological advancements are going to erase these boundaries.”

If these criteria is only the criteria to make the conclusion, how far Technology has arrived or is set to arrive in near future or near long term future to erase these boundaries between Humans and Machines?

Stay Tuned to read the analysis….

( To be Continued …. )

Housing Market – Gold mine of 2013


Two things could not have skipped the attention of people in 2013 – Stock market and Housing market. Whether you call it, Fed’s Quantitative Easing circus or real organic growth of US economy, both the markets grew at an unprecedented rate. S & P 500, grew by 26% and the hottest housing markets in US – San Francisco etc – grew by more than 20%. Considering the amount an investor put in and the inevitability to be in the market, I would say, housing market was the gold mine of the year (for sellers and real estate agents). By the way, actual Gold lost more than 25% in 2013.

If you are in the market as a buyer, I can understand what you would be going through now. Inventory shortage, bidding wars, difficulty in understanding and getting the mortgage might have been your day to day things. Among all the mess, it’s very easy to get carried away with the craze and momentum that’s baked into the market. If you could use, here is my two cents towards your home buying experience.

If you are wondering whether to buy now or wait, there is no answer that fits all. Depending on many factors like down payment amount, interest rates, credit history, your current rent etc. you would prefer one option to the other. However, if you are really not comfortable with the high prices and are concerned about the interest rate hike, I would ask you to look at the numbers I presented below.

In most of the top metros, the house prices reached the pre-recession – or pre-bubble if you prefer it that way – levels. In some metros, the median house prices are already higher than what they were at the peak before recession. That means, if you are thinking to leverage the recession, you already missed the boat – except in some markets like Florida (most of the cities), Phoenix, Las Vegas etc. So don’t let that feeling make you buy. The prices might still go higher but may not be at 20% per annum rate.

If raising interest rates are your concern, I would say, your concern is genuine. Interest rates for 30-yr fixed rate are currently between 4.5% to 5.5% depending on your credit score and other factors. It might go up to 6% although it might take some time. However, don’t let that fear make you put a large premium on the price. If are into bidding wars and the prices go up by 10% or more over the asking price, I would ask you to do some Math before you put a hefty premium.

The 8.3% formula

Here I introduce my 8.3% formula. Let’s say today you are ready to buy a house which is $500K. Your down payment is 20% ($100K) down payment and interest rate is 5%. Your monthly payment will be $2,147.29 and over the lifetime of the loan, you pay $773,023.14 in total (both are excluding property tax and insurance). Let’s say that the interest rates increased by 1% to 6% and as a result, house prices went down by 8.3%. The new price of the house would be $458,500 with 8.3% reduction. Consider that you are still up for putting $100K down payment – this would come to more than 20% on the decreased price of $458,500. Your monthly payment will be $2,149.39 and over the lifetime of the loan, you pay $773,780.41. This is almost same as you would pay in the first case. Check the below links to see these numbers.

http://www.mlcalc.com/#mortgage-500000-20-30-5-0-0-0.52-1-2014-year

http://www.mlcalc.com/#mortgage-458500-21.8102-30-6-0-0-0.52-1-2014-year

This formula works well for any house at any price as long as you put 20% down payment and use the same amount with increased interest rate by 1% and decreased house price by 8.3%.

To put in plain words, raise in 1% interest rate is equivalent to 8.3% decrease in house price with 20% down payment. This down payment is to be 20% of the regular price. If you put lower down payment, the decrease in house price should be more to pay to get the same monthly payment. If the down payment is more than 20%, then you would required less than 8.3% reduction in house price to offset 1% hike in interest rate.

Let’s see the numbers for another scenario.

Regular Case

Original Price: $850,000

Down Payment: $170,000 (20%)

Interest Rate: 6%

Monthly Payment: $4,076.94

Total Amount over lifetime: $1,467,699.69

Decreased Case (Price decreased by 8.3% and Interest Rate increased by 1%)

House Price: $779,450

Down Payment: $170,000 (21.8102% of decreased price and 20% of original price)

Interest Rate: 7%

Monthly Payment: $4,054.69

Total Amount over lifetime: $1,459,687.93

http://www.mlcalc.com/#mortgage-850000-20-30-6-0-0-0.52-1-2014-year

http://www.mlcalc.com/#mortgage-779450-21.8102-30-7-0-0-0.52-1-2014-year

Whether the house prices go down or not, is a different question. I am not into the predictions here. However, you can use this formula and see how the raise in interest could be offset by the decrease in housing prices.

Hope you have a pleasant buying experience.

PS: I am NOT a financial advisor. Everything you read on this site is just for information sake and I request you NOT to rely on this info solely.

A tribute to Indian Farmers (To world farmers to that matter)


If you are from India or at least you follow the happenings from India, it’s likely that you heard of Indian farmers committing suicides. Have you ever think of the reason? The reason you may give is that their financial status has been in distress. That’s right. But do you know how bad it is really? Let’s dig into some numbers and know the facts.

For analyzing the facts, let’s consider simple growth metrics of a country – GDP (Gross Domestic Product) and Income-Per-Capita. If you are unfamiliar with these terms, here is a brief explanation. GDP is the cumulative productivity of a country in a year’s time. That means it’s the total income, a country (its workforce) earns in a year. Income-per-capita is GDP divided by population. That means it’s the income person person in the country on average.

In 1990 agriculture’s share in GDP was 31%. In 2011, it fell down to 16%. That means in about twenty years, agriculture lost half of its share in GDP. In 2011, nearly 52% of Indian workforce was dependent on agriculture, which is almost same as it was in 1990. In other words, 52% people are earning only 16% of the GDP where as the remaining 48% workforce, who is non-farmers, is earning 84% of the GDP. That means, income-per-capita of non-farmers is more than 5 times of the income-per-capita of farmers. In other words, farmers are earning 70% less than the nation’s average income-per-capita. For every rupee (dollar) that a non-farmer Indian is earning, a farmer is earning less than 20 paisa (cents). That shows how bad the farmers are doing.

The future for farmers doesn’t look bright either. In 2011-12, Indian GDP is projected to grow at 6.4% where as agriculture is expected to grow only by 3%. On the other hand, food inflation has risen to 12% in 2011. That means if you bought a kilo tomatoes for 10 Rupees in 2010, it would have cost you 11.20 Rupees in 2011. Though there was growth in food prices, the growth is not reaching the end producers – the farmers. Recently you might have heard of Indian government’s decision to allow Foreign Direct Investments into multi-brand retail sector (currently the decision has been put on hold because of the opposition government faced in parliament). This change would have allowed foreign companies to invest up to 51% which is a crucial number to take over the decision making capabilities. If this happens, it would not be a boon to farmers, primarily for one reason. Currently farmers have better negotiation power with the traditional retailers to get better prices to their products. If this law comes into force, then foreign companies would follow the same strategy they have been following elsewhere in the World. If you ask farmers,  in countries like USA, you may not hear much positive opinions about the big retail chains and their pricing policies. These chains make long term contracts with farmers which are less profitable to farmers. As the chains enter the market, it’s likely that traditional retailers will be forced to go out of business because of the fierce competition. As a result, farmers have to agree for the highly restricted contracts from chain retailers or they won’t find a buyer to their products. Hope this law will never be approved. Of course, same effects can be created by the domestic chain retail stores. However, we haven’t seen this trend yet.

Now, do you want to do something to make their lives better? Probably there is not much that we can do except for small help here and there. When you go to shop groceries in India, try to buy from Raithu Bazars (Farmers Markets) instead of buying from a grocery store chain. If you are one of those who don’t think twice before spending 5,000 Rupees on a branded dress or 2000 rupees on a dinner, then don’t bargain with the farmers for 5 rupees on a Kilo tomatoes. Be compassionate to farmers wherever and whenever you can. Hope and wish that Indian government’s decision to allow  FDI into retail business would never materialize.

Since 1997, nearly 2,00,000 (2 lac) farmers have committed suicide. Still every year, more than 17,000 farmers are killing themselves. Despite all these setbacks, still more than 50% of Indian workforce is in agriculture which hasn’t changed in last 20 years. That shows their commitment to their profession. Today, India is the largest rice producer, second largest wheat producer, only after China. India is the second largest in world agricultural output after China. India’s share in world’s agricultural output is more than 8% in 2011. It’s NOT just Cricketers who are bringing glory to India and Indians. It’s farmers too. Hats off to Indian farmers !!!!

References:

http://en.wikipedia.org/wiki/Agriculture#List_of_countries_by_agricultural_output

http://en.wikipedia.org/wiki/Agriculture_in_India

Tim Cook, Steve Jobs’ Alter-Ego?


Note: I like to listen and learn from your opinions. If you like to share your view with me, then don’t hesitate to leave a comment on this and all other articles. I welcome any constructive discussions.

One of the most discussed topics last week is Steve Jobs’ resignation as Apple’s CEO. I like to put forward my thoughts on it. Many reports and TV shows covered this story. Almost everybody agreed that Tim Cook is a good alternative to Steve Jobs. When I read a little bit about Tim Cook, I could not come to the same conclusion immediately. If I was asked my response on this would be,  “we don’t have enough information to say either way”. I may sound strange by saying so, but let’s look into why I have to say that way.

First of all let me acknowledge Jobs’ achievements. I am trying to establish Jobs’ personality so that the comparison between Jobs and Cook would be easier. I don’t go into the history a lot but will briefly touch a few important milestones in Jobs’ life. As we all know Steve Jobs is a Co-founder of Apple. Who is the other co-founder(s) then? That’s Steve Wozniak. He is the design and the electronics guy behind early days of Apple. Apple’s first computer in the market was Apple-I. It was designed by Wozniak and was sold by Jobs. Then it was a good success and laid the path to its next generation computer Apple-II. Apple-II was a huge success. It redefined the computer world and over night Apple and Jobs became the hot news in Tech world. Jobs was the face of the company and he was believed to be a whiz-kid by most of the tech people.

After the success of Apple-II, company did not have a success for a long time during which it had to rely on Apple-II’s revenue for survival. Meanwhile, Jobs started working on a project called Lisa. This was supposed to be a high-end computer with much better configuration than the previous models. For some reasons Jobs was forced to leave the Lisa project which is taken over by others in the company. As a replacement Jobs was given another project (which was completely his brainchild) called Macintosh. Despite the hype it created, Mac was NOT an instant success. Eventually it did good. On the other hand, Jobs was forced to leave Apple.

After leaving Apple, Jobs started another company called NeXT which is acquired by Apple after his return to it. NeXT was not a successful venture, if not a failed one. While Jobs was with NeXT, he happened to buy Pixar Studios for $10M (some say it was only for $5 M). Jobs’ main idea behind buying PIxar was to manufacture Computers for Imaging purposes. His idea behind it was always to sell computers that can be used with Medical Systems etc. Jobs never considered Pixar to be an animation studio though he let some of its resources to be spent on animation. It was the case at least until Toy Story got released. Eventually Pixar was proved to be one of the best animation studios and was bought by Disney for $ 7.4 billion. With this deal, Jobs has become a board member and the biggest investor of Disney.

We all know what happened with Apple after Jobs’ return. He turned the company which was on the brink of bankruptcy to one of the most successful companies in American history ( I am sure Microsoft must be regretting its decision to lend a helping hand of $150M to Apple at that time). Today it’s the largest tech company in the world. By looking at Apple’s history everyone agrees that Steve Jobs is one of the best CEO’s that world ever had.

On the other hand, Tim Cook worked at some of the best computer manufactures such as IBM and Compaq. At both Compaq and Apple he was mostly responsible to the supply chain management. He doesn’t have much experience as a CEO except for a couple of months in 2004 in Jobs’ absence and then seven months in this year. That means mostly he is an operations person and yet to be proved as a CEO.

I like to recollect one of the most common questions in management world. What is the difference between a Leader and a Manager? Just think of it for a while before you continue to read on. Leader is a person who is mostly responsible to set the future course of the company. He has to motivate the employees, define the vision of the company and see how and where the company would be in the years to come. He is also responsible to make the company reach its vision in the given period of time. On the other hand, a manager is a person who takes care of the day-to-day operations. He might define the processes that would facilitate the day to day activities. He makes sure products/services/solutions are delivered on time. The same person can be a good leader as well as a manager. But there is no guarantee that a good manager makes a good leader and vice versa. That’s why most of the companies have two different designations CEO (Chief Executive Officer) and COO (Chief Operating Officer). What’s the difference between a CEO and a COO? Yes, COO reports to CEO and CEO directly reports to the Board of Directors. But that’s not what I am trying to highlight here. CEO is mainly responsible to  define the future course of the company whereas COO is responsible to make sure the operations are performed without any hiccups.

So far Tim Cook was more of an operations person than of a leader. No doubt he did an excellent job in removing all the chaos in Apple’s supply chain. He outsourced all the manufacturing to China and saved a lot of money to Apple while improving the quality of its products. His experience as a CEO is not known yet. Jobs as the CEO and Cook as the COO proved to be one of the best teams (just as Oracle’s Larry Ellison and Ray Lane did). Jobs always had a vision to the company. He is believed to be the world’s best consumer. He had an aesthetic touch to all of his thoughts. Aesthetics always played a crucial role in Apple’s products. If you ask any Apple customer why they like Apple products, the most frequently given answer would be “they look cool”. Apart from coolness, Apple products are simple to use. All this came into Apple’s products only because of Jobs. I am not saying Jobs himself designed all these products. But he has the taste of picking up the best of the designs/features to provide. He would never be satisfied with anything inferior. Tim Cook has declared that he would continue to give the same importance to designs and designers. However, what he also needs is the ability to pick the best one out of 10s of options provided to him. This quality cannot be acquired with experience. It has to be possessed by birth.

In the last seven months, since Steve Jobs announced his leave of absence, Tim Cook has been working as Apple’s CEO. However, in these seven months, I didn’t see any major decisions that can change the company’s path. It’s not very often you see the companies changing or redefining their strategies. So I would say we need to wait on this and see how Tim Cook will do when the time comes to define the company’s vision. With Apple’s current product line any operations person can lead the company for the next couple of years. But we need to see how Tim Cook is going to fare at his job when the time comes. It’s a skill to read the pulse of the consumers. Based on their pulse, products have to be made. It’s what Steve Jobs excelled. Even he was not correct all the time. He had some misfires too. For example, his purpose behind buying Pixar was to sell Image Computers. But how many of us know about Pixar Image Computers? His bet did not work in this scenario. However, Pixar was successful for other reasons which he too surprised about.

Generally when founders of the companies leave and the second generation leaders come in, it’s not easy to share the same vision and view as the founders did. We have at least a couple of cases in front of us to prove it. Where is Microsoft’s growth since Bill Gates gave up the reigns? What happened to Dell in the absence of Michael Dell? What went wrong with Apple between Steve Jobs’ exit and reentry into Apple? On the other hand there are successful stories too when the next generation leadership replaced the founders. Companies like HP and IBM did well even when the next generation took over.

It’s possible that Apple can stand in the same league as HP and IBM does. However, Steve Jobs cannot be replaced. There is no second Steve Jobs and there is no another Bill Gates. Every person is different with his/her own strengths and weaknesses. As Michael Porter, the famous Strategist once said, the leader’s personal values have to be taken into consideration while defining the future course of a company (in defining the feasible strategy of the company). All we need to do now is, just wait and see how Tim Cook’s strengths and weaknesses can off-set Steve Jobs absence.

PS: I hope iPhone 5 release is NOT delayed by Steve Jobs’ absence. Generally new models of iPhone release in June. This time it is NOT out yet. Hmmm…..it’s already end of August, I suppose. Are we seeing Jobs’ effect already 😉 ?