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Sunday, September 30, 2007

The Dying Business Model - MVNO is withering away

The MVNO business model is going downhill.

The Mobile Virtual Network Operator business model is going very deeply into gutter - it seems.

What is an MVNO?

I think the major reason for this goeing down is extreme complexity that emerges due to multiple dependencies on the partners - the MVNO on its own does not own the Network, the infrastructure, the spectrum etc. This is the GIX Bang world where Innovation is behind the Complexity. The pace of complexity is much faster than the pace of innovation - hence the model is dying. If there can be an increase in pace of Innovation - to leapfrog the complexity - or those MVNOs who are able to reach the simplicity on the other side of complexity faster will be making MVNO a successful model.

Outsourcing Patents

In 2002, I told my then employer, that it is a matter of time when Outsourcing patents will be started - obviously by the Big Boys of IT. That was considered - So what? We will not be impacted. This Patent thing is for product companies. The Sevices Industry doesnt have this threat and anyway we are growing 40% YoY.

Well here is the new battlefront started because of business method patents being allowed in US. Look at the following patent applications by IBM

1. Outsourcing of Services
Abstract (US Patent application: 20070162321)
A method for identifying human-resource work content to outsource offshore of an organization. The method is provided on a computer readable medium and includes the steps of identifying at least one task being performed by an organization; associating each identified task with a functional group within a plurality of functional groups related to the organization; determining information about individual human resources spent on each task; determining task information about human resources spent on the plurality of tasks, the task information based on the determined information about individual human resources spent on each task; using the determined task information to determine a value of each task; and outsourcing tasks having a value lower than a predefined limit to at least one of offshore and to a low cost supplier.

2. Electronic marketplace for identifying, assessing, reserving and engaging knowledge-workers for an assignment using trade-off analysis
Abstract (US patent application: 20070043603)
A method and system for matching a knowledge worker to a selecting entity's needs according to a system of codes corresponding to pre-defined rules of engagement. The rules of engagement include, but are not limited to, experience levels, salary, geographic location, job starting date and duration, and industry sector. If a search of knowledge workers fails to match an available worker with a job need of the selecting entity, the selecting entity posts a job posting on a website maintained by a third party administrator who maintains webpages that are accessible only to screened job applicants.

3. Efficient Frontier and Attainment Rate for Business Transformation Outsourcing
Abstract
A method and system for establishing an Efficient Frontier (EF) and Attainment Rate (AR) for Business Transformation Outsourcing (BTO) is presented. EF is the maximum service level achievable at a point in time for a specific business process or business process area. AR is the pace at which the EF can be reached from an initial value. Clients, outsourcers, and third-parties determine whether proposals are infeasible (above EF) or inefficient (below AR). Fact-based discussions of the merits and limitations of various implementation initiatives are supported. A determination is made as to whether there are any business segments to which different EF and AR apply. Any underlying factors for the EF and AR of each business segment are determined, and any change (rise or fall) of EF over time is predicted to maintain an optimally accurate EF and/or AR for each business segment.

Now Look at Microsoft

1. Outsourcing of instant messaging hosting services
Abstract (US patent Application: 20070067396)
A system, a method and computer-readable media for initiating the hosting of instant messaging services for an Internet domain name. A request is received from an entity requesting initiation of instant message hosting services for a domain name, and a secure communication channel is established with this entity. After verifying that the requesting entity is authorized to control the domain name, information describing user accounts having the domain name is received, and instant messaging services are provided for the user accounts.

2. Outsourcing of email hosting services
Abstract
A system, a method and computer-readable media for initiating the hosting of email for an Internet domain name. A secure communication channel is established with an entity requesting email hosting services. After verifying that the requesting entity is authorized to control the domain name, information describing email accounts with the domain name is received, and email services are provided for the email accounts.

Following is the search result links at USPTO with offshoring OR outsourcing in title. Hope this is a wake up call for companies in India and other geographies to understand and invest effort, money and thought in the Patent Game!! It is going to be a big one from this year onwards!!! Look at the increasing trend: 2001: 1 application; 2002: 2 applications; 2003: 6 applications; 2004: 7 applications; 2005: 9 applications; 2006: 12 applications; 2007: 4 applications so far.

20070162321 Outsourcing of services
20070067396 Outsourcing of instant messaging hosting services
20070067395 Outsourcing of email hosting services
20070038502 Efficient Frontier and Attainment Rate for Business Transformation Outsourcing
20060227810 Method, system and program product for outsourcing resources in a grid computing environment
20060200537 System and method for online human resource outsourcing and portal access
20060184412 Resource optimization system, method and computer program for business transformation outsourcing with reoptimization on demand
20060167706 Design for outsourcing contracts
20060161441 Application outsourcing
20060130065 Centralized identity management system and method for delegating resource management in a technology outsourcing environment
20060107070 Method and system for secure computational outsourcing and disguise
20060089943 Computer system and process for aiding in an outsourcing environment
20060080156 Outsourcing command center
20060080119 Method, system and program product for funding an outsourcing project
20060069607 Transformation of organizational structures and operations through outsourcing integration of mergers and acquisitions
20060064336 Method an system for facilitating electronic outsourcing value assessment
20060004596 Business process outsourcing
20050288984 Outsourcing simulation system and method
20050240916 SYSTEM AND METHOD FOR DISTRIBUTED PROJECT OUTSOURCING
20050159992 Process for identifying potential customers for business outsourcing
20050144895 Systems and methods for outsourcing service orders
20050144894 Concrete outsourcing methods
20050131754 System and method for estimating the feasibility of outsourcing information technology services
20050086120 Method of managing subcontracting for backend outsourcing business
20050065831 Simulation of business transformation outsourcing of sourcing, procurement and payables
20050060224 Simulation of business transformation outsourcing
20040220910 System and method of dynamic service composition for business process outsourcing
20040215496 Outsourcing method and system for sheet metal processing industry
20040181465 Method for on-line outsourcing of customized merchandise containing personalized logo
20040181444 SYSTEM AND METHOD FOR MANIPULATING MOTION PICTURE DATA USING LABOR OUTSOURCING
20040128303 Outsourcing management system and method
20040128209 Outsourcing management system and method
20040093298 Method for providing energy commodities trade outsourcing services within the energy markets
20030225638 Method for outsourcing accounting functions over the internet; using an integrated system between the bank account information and the accounting records
20030177039 Method of outsourcing IMRT services
20030177024 Outsourcing service apparatus concerning electronic drawing data
20030069777 Integrated system for providing remote outsourcing of services
20030046656 Information technology outsourcing hubs
20030018608 Method and system for secure computational outsourcing and disguise
20020049778 System and method of information outsourcing
20010051913 Method and system for outsourcing information technology projects and services





Keeping it Simple in GIX

How do you keep the things simple in the world of Globalizing Innovation Complexity (GIX) Bang (a 'la BigBang) World.

1. For starters make the business model straightforward.

What are you selling? To whom? For what specific needs? How you are selling? Also why you are selling?

2. Keep the communication Simple. How to keep the message complete, comprehensive and unambiguous? This is better said then done.

3. Keep the business processes simple. Just because you have a technology available to you, doesnt give you a license to incorporate it into your processes. Un-necessary process complexity is sure-shot recipe for failure.

4. Keep the business metrics simple and straight forward. Let us see an example. In software development organizations measure Schedule deviation and effort deviation and then they punish projects that are having the devitation. What is this deviation? The deviation is from the estimate given by initial project analysts. As we know, software development is not straightforward implementation or production of parts such as an industrial production. It is extremely difficult to have an estimate upfront in software development scenarios. When you measure deviations, you are not measuring the delivarables at all, you are measuring the efficacy of estimation, which anyway is a nebulous.

5. Above all keep the organization structure simple. This can be the root cause of all the issues and problems that your business may be facing. When I say simple, it means non-rigid, malleable organization structures. You need to balance the Service Level Agreement (SLA) driven rigidily and ad-hoc of free structure of a start-up, where everyone does everything. Or may be find out a completely new structure. However, organization design is the biggest challenge that top management has, unfortunately, they do not realize it.

Keeping it Simple is not Stupidity in the world of GIXBang world! May be that is the recipe for success when complexity threatens to destroy everything.

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