CHAPTER SEVEN - BANGALORE
Bangalore, 26 January 2001.
Farah had spent a day with her aunt in Chennai, the south Indian coastal city formerly known as Madras. Her aunt still kept her house there and would visit for several weeks of the year. She and her aunt were the only family members left from the time the family had left Iran during the 1979 revolution. Farah loved the splendour of Chennai with its old buildings and beach front, giving on to a deep blue sea. She could even accept the oilrigs which today stood out above the horizon.
Now she was flying up to Bangalore, a drivable distance or a very short flight, but the contrast was extraordinary. You moved up from the sweltering coastline to the breezy highlands, clear blue skies and pleasant temperatures, despite being just a few degrees off the equator. She was the sole owner of the family business, set up by her much older brother almost two decades earlier. Bangalore is the centre of the Indian aircraft industry and that is what had attracted him, but his love of flying and aerobatics had cost him his life. Farah had interrupted her studies in Moscow to return and take over the business. With her she had brought the somewhat older Peter Arbakhov, twenty-five at the time. If he was interested in her, this had long since been eclipsed by his love of information technology. He was now managing director of the company, which provided software to major corporations in the West.
Many in the industrial world are unaware of the skills and resources available in poorer nations, and they often only learn this at the cost of their jobs when it is too late. If this was proved by the Russians to the Americans half a century ago with a sputnik, it is being rammed home today by the Indians in software. Hitler would have been prepared to sacrifice Eva Braun for their nuclear capability, and if he could have had their software it would have advanced his megalomania by years. In fact, with a smart suntan he could have passed for an Indian, given that many sport moustaches.
The point is that software came to Bangalore not because of the level playing field provided by the information age and the Internet, but because of a history of technologically advanced industry, and the supporting cast that had grown up around it over the years, to achieve critical mass. Farah's firm was among the first to seize and develop the opportunity. Today there was hardly a major corporation in the West which did not employ the skills of her firm or its peers.
Before Peter's arrival, general management of the firm was in the hands of two middle-aged female albino twins, Linda and Betsy, who had worked for Farah's brother. As albinos they had no pigment in their skin and their hair was completely white, their eyes red. They still handled general management, which in their case meant micro-management. For a mother to bear an albino, white as snow, had often been held to be a curse in India, which did not bode well for twins. Conversely, in northern parts of the Indian sub-continent, fair skin and economic power can go hand in hand. Whether this derived from the British Empire, the Moguls before them, who came from the northwest and established their Empire with bullock carts driven against the enemy, or even earlier invaders driving the darker Dravidians southwards was moot to the twins. They had never felt comfortable in themselves and treated their employees as if they were vestal virgins or eunuchs in a harem: it was a very closed community.
Farah always did her rounds of the employees on her infrequent visits in her role as feudal overlord, which took ever longer as the business grew. Today she was thinking that, with the plans she had, there would have to be a one step move to modern professional management. Today everyone knew her, tomorrow no one would. The tour over, she could hear Peter and the twins, assembled in the boardroom, as she approached.
"My vote is Princess Diana," said Linda.
"No, no, Sonia," countered Betsy.
"I would vote for Catherine the Great," said Peter, but then I have never lived in a democracy which would give me a vote, this one included."
Farah entered the room dressed in a stylish sari, lustrous red hair over her shoulders. "I'm glad none of you compared me to Mother Teresa. I'm not Albanian and I couldn't stand the wrinkles."
They stood and greeted her, Peter as always giving her a hug with tears flowing down his cheeks. Farah made a mental note that she would have to send him for some counselling, if she were going to have him sit on a professional board. They sat and chatted.
The meetings were never about current business. Everyone was fully apprised anyway. In this tight structure managers were promoted if they worked well and had potential. There was nothing to gain by profiling themselves in meetings, claiming false credit and misdirecting blame, and as a consequence the culture was to get on with the job. Any business discussion among the four of them at the top was about strategy, and that was Farah's aim today.
"I want to set out some ideas for a new direction she said. We have always been aware that software development has given us access to vast knowledge and information about our clients. We've thought about writing lines into our clients' software illegally to achieve objectives for ourselves, but we never really satisfied ourselves with the balance of risk and reward."
"We have done some first class sleuthing," Linda added.
"Yes, you have, and I shall come back to that. I still have to thank you for the very valuable information on Constexo, which you provided me in December. What I want to focus on first is how we can use the knowledge we acquire."
"Along the lines I have been researching?" Asked Peter.
"Exactly on those lines," said Farah. "But we need to select the industry. Peter, you remember when back in the early nineties everyone here was clambering over one another to get mobile telephone licences. I said I didn't see how you would achieve credit collection in India. I thought people would use our phones and then simply throw them away when the bill came, and there's no way we could chase them in courts here. Well, I have researched the many failures around the world and more recently the many successes. We may or may not have survived, if we had gone into mobile phones then, assuming we had managed to win a licence."
"But now the situation has changed. It's turned topsy-turvy. The economic principle of barriers to entry in a mature market says that the big guys have the infrastructure, the money and the market position: the small guys don't, can't raise the money, can't build the infrastructure, can't get a foot in the market and therefore can't succeed. So what's happened now? The big guys have bid astronomical prices for third generation phone licences, saddling themselves with huge debts. Instead of having the money, they've got the debt. It's no win for them, as we've seen time and again. On one hand, the market leaders have to get the licence to continue to be a market leader, on the other hand they jeopardise their future with the price they have to pay for the licence. Eventually it all collapses and a winner comes through, but no one knows who that winner will be. Until then its pandemonium. It's like the arms race."
"I get your point," said Peter, "so what do we do?"
"I'll tell you what we do and how we do it. Software is the key. Third generation phones are coming. We bring out a package which leapfrogs the third generation phones, incorporating voice, mail, navigation, household management, time management, financial management and execution, media, entertainment etc. In fact, everything that everyone else has promised to deliver and failed."
"Farah, you don't even have a mobile phone," said Betsy.
"I don't need one: I meet people."
"And why will this work for us?" Betsy followed on.
"Betsy, you and Linda will manage the existing business, and I want you to do a bit more snooping. I have a list of US corporations for you. Peter will establish a new unit, which will focus on getting contracts in telecommunications. It will then set up a process for parsing the information we acquire."
"We are not inventors, we will simply plagiarise, copy, bastardise, or as they like to say today, adopt best practice. We have a five year window."
"I like the challenge," Peter said, "but it's going to take a few crores of rupees."
"No rupees. We can't risk being in any particular jurisdiction. I have established a Swiss company that will subcontract the work to our company in India. You have full signature authority over the company and its bank accounts, Peter."
Peter opened the package she passed across. "This is capitalised at fifty million Swiss francs. Where did these megabucks come from?" Peter was flabbergasted.
"Peter, do you think I've just been swanning around these last five years, while you three kept your noses to the grindstone? If my plans come through, you'll have a bucket load of dollars by the end of the year. If I do my bit, I hope you can do yours. And, Oh, we'll need a name. We're up against Goliath, several Goliaths, so you might want to call it "David". However, my preference is that the company and all its products be named "Zelda" for branding purposes."
And with that the official part of the meeting was over. If Peter felt he was being asked to be the Bill Gates of the personal communications world, he did not show it.
The four of them left the office building together. They went to have tea on the lawn of Farah's house, shaded by palms. It was quite a sight: even Peter's blonde Russian looks were a contrast to the albinos, and then there was Farah with her flowing red hair. Farah occupied the main section of the house in the few days of the year she spent here. She had many servants: a mali looked after the garden, where they sat; tea was brought out by a bearer; it had been prepared by the cook; an outside sweeper cleaned the terrace behind a wall covered with bougainvillea; through the window you could see the inside sweeper cleaning the hall; the day chowkidar guarded the gate, and would be relieved at sunset.
She did not for one moment believe that this level of servant activity persisted during her prolonged absences, but she saw it as a mark of respect for her presence. A less charitable mind may have considered it an attempt by the servants to keep a cushy job. Peter occupied a smaller wing of the house. Even if he had spent more time here, rather than in the office, he would never have noticed whether the house was cleaned or not, and the garden tended. The de facto head of the household was the cook. In fact, Farah kept the cook on as tight a string, as the cook kept the others. She had been used to servants since she was a child, and knew exactly how to control this situation. It had been a wonderful end to the day for all of them, just to be together again, as in the old days. As they left, they each hugged Farah, and she told them, much to their surprise, that she would not only be back soon, but that she hoped to stay in Bangalore again, indefinitely.