MIXING business and 'social responsibility' was perhaps never so easy for India's info-tech industry. Catch 'em young in schools and colleges that matter, fill in technology gaps with expensive and exclusive donations. In the process, grab a mindshare of the market to add to your brand equity, if not hard-to-come-by quality infotech professionals for the company's future operations.
It stares at you at the beginning of the descent into the Indian Institute of Management (IIM), Bangalore's computer centre: a colourful, laminated board advertising the Alpha Systems Intranet server, the Fire-wall server and routers of Digital Equipment Ltd. A few steps down and there's one for the Digital Alpha Server systems, one more for Digital's Venturis Fx Family desktops and yet another for Digital notebooks.
All free ads for Digital's sponsorship in excess of Rs 1 crore for a computer network, an intranet, connecting the four IIMs in the country. Next door, in another lab, sit a dozen-odd Compaq Multimedia Presarios worth Rs 20 lakh—courtesy Compaq, of course—where students train in practical multimedia computing integrating sound, animation, text, graphics and the Internet.
At the Intel Cyberskool in Mumbai's Nehru Science Centre, over 15,000 school-kids have felt the power of multimedia computers, educational programmes and the Internet on Intel's Pentium processor-based systems in under three months. The expense incurred by the students: perhaps only on commuting to the venue.
For the engineering student at IIT-Mumbai and IIT-Delhi, it's more about leading edge technology than money as the Intel Technology Lab affords room for research and development activities on state-of-the-art Intel architecture not available to their counterparts in less privileged institutions. Which, again, is just a part of the company's $5 million cumulative investment in the education sector in India for the current year.
At IIT-Kanpur, you have a Rs 3.6 crore software boon, given by Parametric Technology Corporation to promote "excellence" in mechanical design automation. Here, transaction automation giant Verifone has donated Rs 40 lakh to equip a lab and create an endowment to support student fellowships. It has also made an endowment of Rs 35.5 lakh at IIT-Mumbai, to establish a Verifone Chair to promote database research.
The list is almost endless: Microsoft's donation of equipment worth $1 million to all six IITs; Hewlett Packard's donation of equipment worth Rs 36 lakh to IIT-Delhi and Rs 5 lakh to IIM-Bangalore; Infosys' workshop for computer science faculties in Karnataka's engineering colleges and its vacation-time software programming training for high school students; IBM setting up 15 exclusive centres for software training at a cost of Rs 6 crore....
For a high-growth industry targeting a seven-fold increase in sales in the country in four years—from 6,00,000 computers this year to 4 million units in AD 2000—it's never been as important to catch future engineers and managers when they are still being taught to make decisions. Also, with 50,000-odd new jobs being created every year in the software industry alone, equipping engineers-in-the-making to deal with real-time situations and problems at their future workplace—which could be the sponsoring company in all probability—is crucial to a sector to sustain its annual 50 per cent-plus growth. "Digital has always worked closely with educational institutions both abroad and in India... we believe that's where the future managers are produced. And which is where we need to get associated with them," says Binod Singh, vice president (systems business unit), Digital. "Getting involved with education brings us into direct contact with users and customers. In that sense, it's indirect marketing—with that degree of respectability that comes with teaching," adds Pawan Kumar, president (services and software development), Tata Information Systems Ltd (TISL). "The indications we have from our partner IBM's experience abroad is it helps the company grow faster." Nobody understands the mantra more deeply than IBM; the company pioneered tie-ups with educational institutions 70 years ago. With the growing use of computers in the US in the '60s, IBM began offering institutions a whopping 70 per cent discount on PCs until the US
Monopolies Commission stepped in to stop the practice. Unlike IBM, however, not many Indian companies openly admit the long-term business spin offs involved in contributing to the education sector. "Social responsibility and doing something for the community" are pet-phrases; brand visibility and mileage "could be hidden benefits". But none denies the fact that educational institutions offer an honest opportunity. Says Abhishek Mukherjee, country manager, Compaq: "Maybe youcan call it subtle marketing. But it's long-term value for the institutions and good brand-building for us."
"These programmes achieve twin objectives," says Atul Vijaykar, country manager, Intel. "One, of course, is it being a valuable social activity. The other is what we call educated or informed self-interest. In the long term, it helps us by increasing the use of computers and, therefore, that of building blocks that Intel supplies." Besides, Vijaykar admits the activity strengthens the Intel brand since it projects the company as much more than a supplier of microprocessors—"as playing a role in driving technology in the industry".
For Verifone, however, it's using and honing the skill level offered by premier institutions like the IITs that matters more. For instance, the company is using IITs in Mumbai and Kanpur to research smart card technology and standardising user-interface descriptions. Says Monte Harris, CMD, Verifone India: "By endowing a chair or a lab, we can get some R&D going that we, as a functional organisation, can't do. Obviously, everything we do in a competitive environment is to position oneself for recruitment and growth. To enhance our ability to recruit and get the right kind of people."
YOU may, for instance, find the IT industry's 'social responsibility' ending withpremier institutions like the IIMs, IITs, IISc and their ilk. The quality of students here, especially their ability to utilise a donation, is one responsible factor. Moreover, these institutions are also the alma mater of most senior managers and engineers in donating companies. "So there exists an emotional bond," says Singh. Besides, as IIT-Kanpur's Prof S.G. Dha-nde points out, donations to IITs are eligible for tax deductions for industry.
Institutions certainly aren't complaining. "Though we aren't exactly going around with a begging bowl, we can't make such investments in technology due to government restrictions and the need to become self-sufficient," says Prof V. Nagadevara, dean, IIM-Bangalore, to which six infotech giants companies have made significant contributions and more are queuing up. "Educational institutions need to raise resources from various quarters and not depend on government funds alone. It's natural to develop healthy models of industry-academia interaction," adds Dhande.
So when an MTNL chief, like many other CEOs, fondly tells Singh that the first machine he got trained on was a Digital and how it has a lot of bearing on his decisions; or Nagadevara sticks to working on Word Perfect ("for the simple reason I started on it") though it's MS Word that's generally used in IIM-Bangalore, it reflects the significance of mindshare in the technology industry. And the plain good sense that cradle-snatching makes.
