Emergic: Rajesh Jain's Blog

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TECH TALK: Points To Ponder: Points To Ponder – 3

June 6th, 2001 · No Comments

Vinod Khosla on how to “re-invent” India:

I believe that 5% of the people empowered by the right tools can pull the remaining 95% of the country along in a very radical way. And in fact a few years ago I looked at this country [US] and said, how many people accounted for the bulk of the social and economic changes in the last decades. There were no more than a few thousand people who drove that change. You can look to a few people, you can look at people in academia, people in business or political activist. No more than a few thousand people accounted for the bulk of the change. Not for doing it but for driving it in this country.

If we can take our [India’s] limited resources and give them to 5% of the people and I will come back to how we pick which 5% percent as that’s the politically important question, and let them put it to the highest use so that we multiply these resources. When we start with a dollar, next year we don’t have 50 cents to give away, but we have 5 dollars to give away. Because entrepreneurial energy and a business case is being applied.

Let me do a simple calculation for you. I originally did this calculation in the US context. For 3% real growth accumulated over a 100 years results in a multiplication factor of over 20. So if you assume the US per capita income is, pick a number, say 35,000 dollars and we accumulate 3% growth for a 100 years, the per capita income in the US at the turn of the century will be over 700 thousand dollars. That’s a humungous number. Why? We are applying the exponential equation at 3%. At 3%! We can clearly achieve much larger figures in the context of India if we use these resources effectively.

The full text of Vinod Khosla’s speech, including his suggestions on what should be done in India, is available at (MS-Word file):

Michael Porter on Strategy in Fast Company
( http://www.fastcompany.com/online/44/porter.html ):

The essence of strategy is that you must set limits on what you’re trying to accomplish. The company without a strategy is willing to try anything. If all you’re trying to do is essentially the same thing as your rivals, then it’s unlikely that you’ll be very successful. It’s incredibly arrogant for a company to believe that it can deliver the same sort of product that its rivals do and actually do better for very long. That’s especially true today, when the flow of information and capital is incredibly fast. It’s extremely dangerous to bet on the incompetence of your competitors — and that’s what you’re doing when you’re competing on operational effectiveness.

Tags: Tech Talk

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