“THE CENTER OF GRAVITY DOESN'T HAVE TO BE THE U.S”

“The center of gravity doesn't have to be the U.S”
In 25 years, it may not be.
In 50 years, it won’t be.

"The center of gravity doesn't have to be the U.S.," states Prashanath H. Boccasa in a Washington Post article entitled, “India's New Faces of Outsourcing: High-Level Technicians Lead a Transcontinental Shift in Business Culture”.[i] Boccasa is the founder of Approva, a Reston, VA company.

Mr. Boccasa is an Indian-born American entrepreneur. His company, Approva Corp., is a computer software company that makes compliance software for the Sarbanes-Oxley law. This law is aimed at improved corporate reporting and internal accounting practices. Approva has sites in Reston, VA and Pune, India. The office in Pune, India handles programming and development. The Reston office provides marketing, sales and management. What distinguishes Approva and some other companies is that Indian-American employees are stepping out of the more traditional tech roles into management and other non-technical roles.

INDIAN-AMERICAN PLATFORM COMPANIES

Approva, and other organizations with Indian and American operations, are demonstrating that American organizations will have no lock on the Platform Company model. As readers recall, Platform Companies are the corporate model where Western companies retain the high-margin marketing, sales, design and engineering functions, while the low-margin, high risk manufacturing (or programming) work is done in Asia and other developing companies.
Things are already changing. Listen to what Constancia Fernandes, an Indiana employee of Approva says:

Fernandes represents a generation of Indian workers that is redefining outsourcing from call-center and back-office work into higher-level management and strategy jobs -- areas that Americans workers have often regarded as safe from overseas competition. As they climb higher in the corporate food chain in transnational firms, Indian workers and executives are pushing their U.S. counterparts to take them seriously, taking on greater responsibilities and subtly changing the corporate culture of both countries.[ii]

Approva, and other Indian ventures, are now straddling the frontier between the US and India. Approva provides a service exclusively to American companies or foreign affiliates of American companies under the Sarbanes-Oxley law. But perhaps as Indian corporate governance rules grow and change, Approva’s products may find a market in India. Or in other nations.
And at some point in the future Approva may step back across the Pacific Ocean and conduct operations in India alone. It will take its Platform and go home to serve its international customers.

ONE PLATFORM COMPANY DOES NOT AN ECONOMIC MODEL MAKE

The central question is how many exclusively American or European Platform Companies will remain free to slough off the grunt work to Asian manufacturers? In 25 years, there will still be quite a few. In 50, maybe not so many. See you in Pune!

THE DESERT OF THE REAL STRADDLES ALL FRONTIERS!

[i] www.washingtonpost.com, 1.11.2006.
[ii] www.washingtonpost.com, 1.11.2006