The dilemma for Bangalore software industry

The dilemma for Bangalore software industry

By Rajesh Setty on Sun 21 Jan 2007, 4:50 PM – 10 Comments

I am in Bangalore (called Silicon Valley of India which I totally disagree – more about that topic later) for the last few days. I have learnt a lot in the last few days.

First, while the IT boom has helped a small percentage of people directly and a larger percentage of people indirectly, it has created a bunch of problems for all the people. Let me just focus on the dilemma for the software industry here, in this short note.

1. Small and mid-size companies typically are having a hard time attracting top talent to their companies. How can a small company match all the perks and resort-style living offered by big companies anyway?

2. The big companies are able to attract top talent. However, they are focused on getting bigger projects. Majority of bigger projects are focused on commodity work.

3. The big companies are not interested in working with smaller clients as the deal sizes are small. These smaller projects may be “really cool” but it may not make business sense for larger companies to chase them. Margins may just not justify the effort.

4. Smaller companies won’t get projects from bigger clients (size does matter) so they get the cool projects for small and mid-size clients. Unfortunately, since they can’t get top talent to work on these cool projects, they have to work “extra hard” to satisfy the clients.

5. The big companies are thriving on big commodity projects staffed by top talent. I think top talent who are working on commodity projects are held as prisoners as obviously they are being “overpaid for commodity work” but they can’t exit as they have to make a “big sacrifice” to make the switch.

In summary, small companies are “struggling” to deliver on “cool projects” as they have to deliver them using “average” people. Big companies are “thriving” on “mediocre work” (also called mega projects) and staffing them using top talent. Who is really winning here?

My $.02 of course.


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10 Comments so far, Add Yours

Anonymous  on January 22nd, 2007

Very well said Rajesh. People have forgotten the aspect of passion in pursuit of $$$, which BTW is natural byproduct of passion

Anonymous  on January 22nd, 2007

I completely agree and can testify your observations. My last 7 years working for Bangalore based companies, big and small have resulted in noting exactly the same points you have mentioned.

No matter how much of $$$venue the biggies get, if they can’t create balance between having a cool project and a mega project, they should stop hiring cool top talent.

Another point to be added, while it may seem that the big companies offer all kinds of perks and resort style living, end of the day in long run it merely boils down to eye candy and shallow proudly feeling for young software engineers. They start looking down upon hardworking engineers working for small companies, I am not stereotyping here, but that’s my observation and opinion.

By the time the engineers get senior and realize this, they would have got used to it, and set a comfort zone to themselves justifying their actions.

Anonymous  on January 22nd, 2007

I want to add yet another observation here. Slightly off-topic.

Many service oriented companies big and small seem to want to extract too much from young engineers. They lure engineers in to promotions, so called exponential career growth with flashy titles/designations, before even they begin to understand the dynamics of a bandwidth of software projects.

Project management simply seems to be just assigning tasks, calling meetings, extracting hard work (burning midnight oil) from juniors and working with MS project. It isn’t that simple and young engineers need to have experience in wide variety of projects hands-on before even getting in to managing people and technology.

In my opinion, experience and depth in understanding the dynamics are the most important aspects of working your way up in the software industry.

I am going to have to write a whole series of blog posts on topics like this and others.

Anonymous  on January 22nd, 2007

Truly said, the top talent are taken/recruited by the big companies and told to execute large volume project less significant portion of the work with old technologies as they are the one paying big bugs which big Companies looking for and its very sad for the top talent pool. Hopefully over the time it will change once the big company honeymoon period is over and see stability in the industry. But don’t know when will that stability achieved.

Anonymous  on January 22nd, 2007

There is one thing in your post that does not jive with me. One thing your post assumes a priori is that there are “average “people and there is “top talent”. Maybe so, but the post also seems to assume that the average person stays average and the top talent stays that way. (I could well be reading more with this last point than you intend to convey.)

The labels likely apply at one point in time, even if they are correct at the time of hiring. I believe that talent in a person develops in proportion to the challenges thrown at the person. So, what would happen with the scenario you describe is that the “average” person working on challenging problems would become top talent in a few years and if the top talent working in a big firm does not watch out, he/she will become an average person in the larger employee pool. Layoffs and attrition will set up convection currents that will mix up the folks who used to be average and who are now top talent and vice versa.

I feel that the dynamics are pretty complicated and your analysis may be a little simplistic.

Anonymous  on January 23rd, 2007

Thanks to all of you.

Kaizen Man,

1. Yes I always believe that there are different kinds of people and it is always a point in time reference. I don’t seem to have stated that the labels apply for a lifetime.

2. I agree with what you said in the second paragraph. I don’t seem to have stated anything that is contradicting this.

I also agree with you that the dynamics are pretty complicated. I don’t claim to have analyzed it except offer my observations from my interactions with a few hundred people in the last few days.



Anonymous  on January 23rd, 2007

I had parenthetically indicated that I may be reading too much in your post. After re-reading your post, my comment and your reply, I feel very much that I was reading more than you intended to say. Sorry about that!

The only point I wanted to make was that about the situation being dynamic and the “average” and “top talent” labels being mobile etc.

P.S. BTW the new look of your site is very nice.

Anonymous  on January 23rd, 2007

Thanks Kaizen Man,

I liked your post as it nicely extends the argument.

The problem you brought up was that of characterization. We characterize some people as if the attributes are set for life. It is common at work and outside the workplace too. You can see it happening in everyday conversations. This is wrong but since everyone is doing it, people fall into that trap too.

Thanks for your comments on the blog design. I am glad you liked it.



karen  on May 5th, 2008


My experience last week was a stark awakening to this reality you have mentioned in your blog. There are a lot of small companies that sign-up projects in which they need to work on technologies they do not have expertise in.

This is a lose-lose situation where the client is not satisfied with the throughput. And the team, after all the hard work is still blamed for incompetant work.

When an new resource in one of these small companies completes a project or two and gains relevant experience on the was, he/she chooses to move to a bigger company with a bigger paypacket. And the cycle continues.

nice blog, bringing to light these problems. It gets me thinking on a way to solve this.



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