Wednesday, September 20, 2006

What's the Secret of your Success?

An excellant summation by Micheal Hyatt. We all have heard of (and experienced) what a positive attitude can help achieve, however, in today's times I would add another trait - curiosity, as I believe that in a Knowledge economy unless you have an inquisitive nature and are constantly seeking answers or trying to look into the future you would lag behind. This is what Mr Hyatt has to say on what he considers is the single most important trait -responsiveness.

As a CEO, I get asked this a lot. And, I'm always a little embarrassed by it. For the most part, I get the question from people who are in their twenties. They want to know “the secret path to the top.”

This past weekend, I received an email from one of my readers. He started, “I have an MBA, but I must have missed the course on Fast-Tracking My Career. If you had to boil it down to one thing, Mr. Hyatt, what would you recommend to a young, aspiring person such as myself?”

I'm not sure I could boil it down to one thing. Life isn’t usually that simple. But if I really, really had to boil it down to one thing, I would say this: responsiveness.

So many people I meet are unresponsive. They don’t return their phone calls promptly. They don’t answer their emails quickly. They don’t complete their assignments on time. They promise to do something and never follow through. They have to be reminded, prodded, and nagged. This behavior creates work for everyone else and eats into their own productivity. Sadly, they seem oblivious to it.

When I was a kid, we used to play “Tag.” The objective was simple: keep from becoming “It.” If someone tagged you (touched you), you became “it” until you tagged someone else. Whoever was “it” when the game ended, lost.

Business is very similar. People “tag” us in countless ways every day. They place calls. They send emails. They mention something to us in a meeting. Suddenly, we are “it.” And, just like the game, if you stay “it” too long, you lose. The only winning strategy is to respond quickly and make someone else “it.”

Reality is that we live in an “instant world.” People want instant results. They don’t want to wait. And if they have to wait on you, their frustration and resentment grows. They begin to see you as an obstacle to getting their work done. If that happens, it will begin to impact your reputation. Pretty soon people start saying, “I can never get a timely response from him,” or “When I send her an email, I feel like it goes into a black hole,” or worse, your colleagues just roll their eyes and sigh at the mention of your name.

Yet, these are the very people who will push you up or pull you down. You cannot succeed without the support of your peers and subordinates. (Go back and re-read that sentence again.)

As I was making my way to the top, my former boss, Sam Moore, used to ask everyone I worked with, “What’s it like to work with Mike?” “How’s he really doing?” “Do you think he could take on more responsibility?” In responding to him, all they had was their experience with me. If I hadn’t been responsive to them, how do you think they would have responded to his questions? “More responsibility? Are you kidding me? He can’t handle what he has now!” It wouldn’t take too many candid responses like that to tank my career.

And yet this happens to people all the time. I can’t tell you how many meetings I have sat in where people are complaining about someone else’s work habits. “He always waits until the last minute.” “She never plans ahead.” “I can never get him to respond to my emails.” You may think that the people who are making these comments are too far down the food chain to matter. I can assure you they aren’t. They have a way of bubbling to the top where the decisions about your career are made.

The truth is, you are building your reputation—your brand—one response at a time. People are shaping their view of you by how you respond to them. If you are slow, they assume you are incompetent and over your head. If you respond quickly, they assume you are competent and on top of your work. Their perception, whether you realize it or not, will determine how fast your career advances and how high you go. You can’t afford to be unresponsive. It is a career-killer.

My basic rule is this: respond immediately unless there is a good reason to wait. Obviously, this isn’t always possible, especially since I spend so much time in meetings. Nevertheless, I rarely let messages sit longer than a day. Twenty-four hours is the outside edge. If you can’t respond now, then at least acknowledge that you have received the message: “I received your message. I don’t have time to give it the attention it deserves right now, but you can expect to hear from me before the end of the day tomorrow.”

The great thing about being responsive is that it will quickly differentiate you from your peers. People love doing business with responsive people. Nothing will advance your career faster than this.

Monday, September 18, 2006

Warren Buffet on Value

 

Price is what you Pay, Value is what you Get

                                                                                 Warren Buffet

Service Tax on providing Recruitment Services to Overseas Companies

I have been asked by some TPR associates as to what is the
correct position wrt Service Tax on Provision of Recruitment Services to companies abroad. 

In this connection I would like to, firstly, point out that Service Tax is a destination based consumption tax and it would, logically, be leviable only on services provided within the country and not be applicable on export of services.

However, as I had mentioned in one of my earlier posts, wef March 15, 2005 the Govt has introduced the Export of Services Rules, 2005 which have, subsequently, been amended from time to time. Hence, currently, the above query needs to be answered in the context of the said Rules and the amendments notified thereto.

As per Rule 3 all the taxable services have been divided into 3 parts, each part being represented by a sub-rule. Each part has a different set of criteria so as to treat the service provided therein as an “Export of Service” and hence become eligible for being treated as Exempt.

Suffice is to say that sub-rules (1) & (2) are not relevant to our query as they apply to

(1) Property based services i:e services which are related to immovable property and cover service providers such as Architects, Interior Designers, Real Estate Agents, Construction Services, Site Preparation Services, etc

(2) Performance based Services, i:e services which are performed by service providers either fully or partly outside India, the service is used in a business or for any other purpose outside India and payments are received by the service provider in convertible foreign exchange. Service providers covered under the said sub-rule are Stock Brokers, Practicing CA/CS/CWA, Security Agencies, Tour Operators, Event Managers, Travel Agents etc.

Manpower Recruitment or Supply Agency Services, along with many other services, are covered under the residual services category of sub-rule (3) of Rule 3 which is primarily for recipient based services and these services will be treated as Export of Services, if such services are used in or in relation to commerce or industry and the recipient is located outside India.

However, in case the recipient has any commercial or industrial establishment or office relating thereto in India, such services shall be treated as Export of Services only if the order for such service is made from outside India, the services are delivered outside India and used in the business of the recipient outside India as well as the payments are received, by the service provider, in convertible foreign exchange.

In case, the service provided is not used in or in relation to commerce and industry, the service provided will be treated as Export of Service only when the recipient of such service is located outside India at the time when such service is received. This would generally not be applicable to recruiters as their service would mostly be used in the business of the recipient outside India.

From the above the following situations emerge:

a) Where the Recruiter, in India, provides services to a Recipient (client) located outside India which does not have any commercial or industrial establishment or office relating thereto in India and such services are used in or in relation to commerce or industry by the recipient – then the said service is exempt and can be provided without payment of Service Tax.

b) Where the Recruiter, in India, provides services to a Recipient (client) located outside India which has an office or establishment in India but the order for commissioning such service is from outside India and such services are delivered outside India and also used in or in relation to commerce or industry by the recipient as well as the payments are received, by the service provider, in convertible foreign exchange – then the said service is exempt and can be provided without payment of Service Tax.

c) Where the Recruiter, in India, provides services to a Recipient (client) located outside India but such services are not used in or in relation to commerce or industry by the recipient – then the said service is exempt and can be provided without payment of Service Tax only in cases where the recipient is located outside India at the time when the service is received by it as well as the payments are received, by the service provider, in convertible foreign exchange.

In my opinion what is of great significance is that in the requirement of para (a) above there is no mention of monies being received in convertible foreign exchange and in para (b) there is an additional requirement of having to prove that the service was ‘delivered’ outside India.

As far as the para (a) requirement is concerned I am of the opinion that all Recruiters should play it safe and only treat those invoices as exempt from Service Tax where, even though they meet all the other conditions, the monies are actually going to be received in convertible foreign exchange.

As regards the requirement of proving ‘delivered’ under para (b) above, I guess, in case all the other requirements are met, then the Department needs to take a practical view in the matter and treat all such cases as exempt from Service Tax.

I look forward to all comments, queries and inputs.

Tuesday, September 12, 2006

Are global layoffs likely to benefit techies in India

As I have pointed out in my earlier post, Offshoring is good for America, and even Jack Welch has stated that Outsourcing Is Forever - Jack & Suzy Welch, thus this story, in the Econimic Times, which has a slightly different take, is worth a look. In the end, I Think,  it will come down to how effectively the Indian side handles the PR wrt this issue.

Global pink slips in the tech industry may end up benefiting India. As big-wigs like Intel, Sony, CA, IBM and Sun Microsystems announce the return of retrenchment, Indian HR honchos foresee a spurt in demand for low-cost, high-skilled destinations like India in the near future.
The chip-maker-in-distress, Intel, on Wednesday announced that it will reduce its global work-force by 10,500 by mid-07. But this is unlikely to have a huge impact on its India operations, which incidentally, is its largest development centre outside the US. The company refused to put any India numbers on the table, but indications are that investment commitments of over a billion dollars will stay, so the local layoffs may not be high. However, indications are that there could be a cap on hiring.

Indeed, with cost-cutting a major priority, Intel may outsource more to India, say market sources. “India could stand to gain from these global layoffs. Due to talent availability at cheaper costs in the Asia Pacific, Central America and East European regions, business processes are being restructured and shifted to these locations," says Pradeep Udhas, KPMG executive director and CEO, KPMG Resource Centre.

For instance, IBM, which announced axing of 13,000 jobs in Europe and the US, followed it up with plans to treble its investments in India over the next three years by pumping in $6bn towards its operations here.

Rakesh Malik, practice leader-global sourcing (India), Hewitt Associates, said: “With global competition fuelling restructuring efforts to attain greater efficiencies at low costs, firms are exploring different geographies outside the US.” A talent crunch in some markets further triggers the search for newer alternatives, he added.

Terming layoffs announced by Intel as a ‘correction’, Nasscom president Kiran Karnik said: “The industry goes through a business cycle. It is a temporary phase where the company is attempting to strike a balance between manpower and demand. As the business moves towards an upcycle, I am sure they will add people.”

Experts, however, point out that India Inc, through industry associations like Nasscom, needs to intensify efforts to manage its PR globally in order to deal effectively with the sensitive issue of job losses in countries such as the US.

AESC Member Search Firms Form Alliance

One has been talking (and writing) about the evolution of new
business models for the past year or so primarily because of my
exposure to similar trends in the CA profession, where due to the
exponential growth seen by clients it is increasingly becoming
untenable for smaller boutique firms to effectively service their
client's needs (sometimes on account of their lack of geographical
reach/size and at times due to paucity of management/domain
bandwidth). In view of the same, the said professional service firms are adopting new and innovative strategies to overcome their size/expertise limitation and one of the models being increasingly adopted is the formation of an "Alliance of Firms" which operates under one brand globally but firm retains its independent identity too.


I had shared my experience in this regard with some TPRs and some of them had shown preliminary interest in the said model. In the meantime I have come across this "press release" and I would solicit the views and interest of all the members on whether they too feel there is potential in creating such an alliance and what could be the key stumbling blocks/ road blocks in actually creating an alliance of this nature. I am sure others would have had some experiences (or would have heard some war stories) in this regard and it would benefit everybody in case they shared these with the other readers.

As Peter F Drucker pointed out:

"Business once grew by one of two ways: grass roots up, or by
acquisition. Today businesses grow through alliances - all kinds of
dangerous alliance, joint ventures, and customer partnering, which by the way, very few people understand."

Although Mr Drucker is no longer with us in this world, his words of wisdom continue to provide deep insight into this continuously
evolving business paradigm.

Looking forward to all inputs.