Guest Blogger: Pavan Muzumdar

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The editor of a well-known newspaper was known to be a workaholic.  When asked why he never took a vacation, he replied, "Oh I would be too worried wondering how they would manage without me." But then he added, "I would worry even more if they managed well without me!"

One of the most insightful questions you can ask your customer is, "Why do you continue to do business with us?" The answer may surprise you.  Of course, it’s not an easy question to ask. After all, you don’t want to get the customer thinking! But it’s always a good idea to understand your value proposition – objectively.

When I first came to America from India, I was fascinated by the entrepreneurial energy of the country. I am still fascinated by it. America is truly the land of opportunity because the can-do, let’s give it a shot attitude isn’t shackled by a, what if it doesn’t work, we tried that before, or it won’t work, mindset.

According to a poll by CNN, some 66% of respondents said they wanted to start their own companies and be their own bosses.  Obviously because of financial and other constraints not everyone’s dreams will come true in the traditional sense.

But I always thought that entrepreneurship is a mindset. There are two ways to look at a job. One way would be to look at it as an employee working for an employer; another way would be as a service provider working for a customer. The customer is the company.

Then we can ask ourselves, why do I still have a job? What do I bring to the table that adds value to my company? What do I need to do to stay relevant in the future? What can I do to make my company more relevant in the future?

We have all heard companies say that their people are their assets.  That’s only true if those assets are relevant. With an entrepreneurial mindset individuals won’t need to start companies. They will be entrepreneurs in that they will be constantly improving themselves to stay relevant, just their companies have to. That’s the entrepreneurial process. And if they start companies along the way, that’s just gravy.

By exporting software, airplanes, cars, movies, music and TV shows, other countries have actually outsourced the development of these products and services to us for years. Why then should we be alarmed if other countries start doing the same thing?  

If we focus on the fundamentals of creating value and wealth, there is nothing we have to worry about, as a region, or as a nation. The world is our market and we would be open for business.

I started this series with a made-up company called "SueASpammer.com". Perhaps an entrepreneurial attorney will pick up on this and start it for real. I would have been able to give this company several cases for today alone. If it did happen, the only people out of a job would be spammers. And that would be a good thing.

However, while the berry was perfectly safe to eat in its natural form, the FDA insisted that the powder was a food additive and demanded additional testing. The project’s backers didn’t want to spend the money for the testing and the company had to fold.
 
And being in motor-land, how many cars do we know that are actually quite good but don’t make in the marketplace because they just don’t click with the people? How many movies have you heard of described as, “great movie, but it didn’t do well in the box-office.” After all, any product eventually has to be bought – by people. The usefulness of any product is in the eye of the beholder, a product is useful only if people that will buy it consider it so.
 
There’s another factor: the environment in which we create these products.
 
I often hear that Americans are the most litigious people in the world. I look at it another way. We have a judicial system, though not perfect, that allows us, with relative ease, to take our grievances before the powers of the land and sort our differences using pen and paper instead of guns and machetes. So we use it. We should be thankful for this.
 
A powerful judiciary allows people to get together, make agreements, and try to create wealth with the peace of mind that if things don’t go well, someone will hear their complaint.  It is also why we have a strong banking system and an efficient capital market.
 
Michigan is chock-full of innovators. If we collectively adapt our skills, get together into teams that know their stuff, can manage money, and understand people, there is no reason why we can’t be a region of new wealth creation for centuries to come.
 
The other day I met my friend who is in the real-estate mortgage business at Starbucks. We were chatting about business over lattes and pastries. It was cold and after dark, otherwise we would have been mountain biking while we were discussing interest rates. I am thankful that I can.
 
Tomorrow: Be an entrepreneur

I am always fascinated when I observe how my daughter thinks. She will be six next month and her mind is amazingly uncluttered and fresh. Her brain is a sponge absorbing everything around her with unabashed curiosity. Her face beams in pure delight when she learns something new.

And she has no qualms about trying out a new word she has just learnt in a sentence. The other day she said, “Daddy, I think he doesn’t have enough money for a house, that’s why he is living in a department.”  She meant apartment. I haven’t told her about prices for apartments in New York yet.

There’s a silly story going around the email circuit celebrating the lack of skills.  It’s something about a guy who applies for a job at the mailroom in large company, but doesn’t get it because he doesn’t know how to use a computer. Dejectedly he walks away and happens to stumble into selling tomatoes.

His business grows and one day he is with a financial planner who asks him for his email address. When the man says he doesn’t use a computer, the planner says in surprise, “wow, imagine how much more successful you could have been if you learnt how to use a computer.” To which the man quips, “I would have been working in the mailroom!”

I would say a driven individual like that would have probably found some problem to solve in the mail room and made a business out of it – using computers to run it better.

The other day on a morning television show, the hosts were interviewing teachers at a school where the principal was much younger than them. One of the older teachers said very dramatically, “I never use email. If I need to communicate something, I send a memorandum!” There was nothing in this teacher’s demeanor or appearance to indicate that he was anything but a normal American. So while he had most likely accepted using the automobile as a tool for locomotion, he had rejected e-mail as a tool for communication with the excuse that he was to old to learn how to use it.

I have heard many people throw around that continued education, or for that matter a college degree is not important. After all, the world’s richest man is a college dropout. What they don’t talk about is Bill Gates’ “think-week”. This is a seven-day period of seclusion that Gates uses to refresh his brain with the stacks of books and papers on the latest developments in the business and technology world. If that’s not continued education, I don’t know what is.

He is known to put in eighteen-hour days during these retreats. Legend has it that it was after a think-week in the nineties that convinced Gates to steer Microsoft to embrace and be ready for the coming Internet tidal wave. History is littered with examples of companies that have withered overnight by disruptive forces like this while Microsoft has remained standing and continues to be a dominant force in the software world.

Just a century and a half or so ago, China and India represented the lion’s share of the global GDP. It was almost all agricultural. By 2000 it was USA, Japan, and Europe. What changed? One word: knowledge.

Very simply, these countries figured out how to make more stuff cheaper, faster, better and more useful. And they reinvested what they learnt into continuing the process.

School can either be a place to learn new things or a place to learn how to learn new things. The knowledge is there for the taking on the Internet. For example, MIT recently made available all its courses on the web at http://ocw.mit.edu/index.html. You don’t even need to attend MIT. All you need is an internet connection and a web-browser.

If you’re an electrical engineer interested in political science, or an accountant interested in anthropology, knock yourself out. Then write a blog and share your thoughts and ideas with people all over the world.

The human brain is the single largest creator of wealth. Knowledge and information are the tools that the brain uses to create value. With access to these tools there no reason why each one of us can’t be a dynamo of innovation and creation.

All we need is the curiosity and attitude of a six-year old dying to learn something new everyday.

Tomorrow:  It’s all about stuff, money, and people

My company recently received a patent for a software product that it has designed and developed. It is one of those “necessity is the mother of invention” stories. 

A few years ago I needed to see combined financial information of three companies that I oversaw so that I could get a quick snap-shot of the overall situation. 

We thought that an easy way to do this would be to put all the information in a spreadsheet so it would be easy to analyze. A quick program later, it was working as planned. Not only that, but it was so useful, that we decided to make it smarter and more universally applicable.

One thing led to another and pretty soon we had software that could be used in multiple industries for a range of applications. A review of existing software patents revealed that we were actually doing this in a novel way. So we applied for a patent.

What’s interesting is that the software was developed in India but designed over here. It’s even more interesting that if we didn’t have access to resources in India, we would probably not have continued with the development of the product because of what it would have taken in the form of investment dollars.

Today however, companies in this country are benefiting from this software and in some small way, are able to do what they do better, cheaper, faster, and more useful. Not to mention, a Michigan company now owns a patent for a commercial product.

It’s easy to lament outsourcing and off-shoring and the tumult of quantum changes in the global economy. But perhaps it would be better to change the discussion. 

Globalization has caused economies to become too intertwined to undo these forces easily. Good or bad, it’s here to stay. Our goal as a region should be to accept it and figure out how to stay relevant and prosperous in the 21st Century.

Monday: Get your Tools in place

British spammers don’t like Nigel Roberts. He sues them. On December 12th, 2005, he received £300 as a settlement for a suit he brought against Media Logistics (UK) Ltd., a company that he claimed sent him spam email messages.

It wasn’t easy, and you could argue that for the amount of time he spent in preparing the paperwork, the money he received wasn’t worth it.  Paying a lawyer would be even more expensive. But for Roberts it was the principle.  

But what if you could ship the work to an offshore location and have someone put all the paperwork together for you? That would be a lot cheaper than hiring a lawyer here.   

Here’s the pitch: SueASpammer.com will take your spam messages, track down the spammer and for a piece of the action sue them in small claims court for you. All you do is show up and collect your money!

If you’re like me, receiving more spam than I wish to delete, this would be a good thing. Local lawyers can rest assured that their billing rates are secure – for now. SueASpammer.com doesn’t exist.

Michigan on the other hand is a bit bruised from the whole off-shoring, outsourcing thing. Toyota is clobbering the domestics in the market-place and China is the new destination for manufacturing. Ask someone who has lost a job to an offshore manufacturer, and this is a bad dream come true.

Others say that the very fabric of our country’s work force is threatened by the evil companies that take our jobs away in the pursuit of more profits.

Successful products and services are good, cheap, and useful. The better we can make it, the cheaper we can make it, and the more useful we can make it, whatever “it” is, the more successful it will be. That’s it.  The rest is chaff.

Cheaper ingredients make for cheaper products. Labor is a major ingredient so it’s no surprise that with our standards of living, it’s not cheap here.

But there’s another way, of making stuff cheap: knowing how to make lots of it easily and faster. And we all know, cheaper is not better, and cheaper is not more useful.  

There’s only one way to make lots of stuff more easily, faster, better, and more useful:  out-thinking the competition. And that’s one thing that can never be outsourced.

Tomorrow:  Let’s change the discussion

Photograph © Dave Krieger