Ramsoft Systems, Inc.

Victor discusses how offshoring software projects to Indica has become dominated by a few large firms. He is looking to grow his business process outsourcing business.

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Filed under: Finding Gaps | Globalization | Information Technology | Ramsoft Systems, Inc. | Southfield, MI | Twelve Month Goals | Victor Naidu

In this 10 minute podcast (download iPod compatible, 51MB), Victor Naidu describes the dynamics of offshoring software development to India. Victor originated in India and still has deep roots there. He has competed in providing offshoring services, but has pulled back from that market for the following reasons:

• It's dominated by large firms managed from India. Located in India, firms can better manage and find talent.
• Victor does not compete on a cost basis, so billing his services as cheaper does not fit with his overalll business model.

In addition, Victor notes that the cost advantage of India is less than it once was, pegging total cost of services from India at 60% to 70%, corresponding with observations by other knowledgeable sources.

One area where Victor continues to compete is in business process outsourcing which includes a major service component where his firm might have an advantage.

Victor discusses his entry into the IT security market in the late 1990s. There seemed to be a clear opportunity as Internet-based systems were introduced into the enterprise. However, market uptake has been limited to finance and health care industries where needs are clear or regulation requires it.

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Filed under: Finding Gaps | IT Security | Ramsoft Systems, Inc. | Southfield, MI | Victor Naidu

In this 14 minute segment (download iPod compatible, 73MB), Victor Naidu and I discuss the genesis and evolution of RAMSoft's security products starting in the late 1990s. Similarly to what Dennis Blanchette described for Ensure, Victor was motivated by the observation that 80% of security breaches are from internal sources. As the scope of the Internet age was becoming apparent, Victor perceived this as an opportunity to fill another gap in the market place. However, it took security products a while to catch on. Victor notes the following:

• Although the conceptual need for security was clear, many potential customers were not initially perceiving security as a pain point.
• Victor has found niches in health care, motivated by HIPA privacy regulations, and finance.
• One of Victor's main customers produces loyalty cards, a topic we covered with PowerPass.
• The need for technology to monitor use of technology arises from the ubiquitous use of technology making it impossible to monitor by traditional means. It's a self feed cycle.

In our next segment with Victor, we will be discussing his global initiatives.

I continue my discussion with Victor Naidu. He views both ERP and the web as providing components for companies to build innovative business solutions. We attempt to dissect how.

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Filed under: Finding Gaps | Globalization | Information Technology | Making Substitutes | Ramsoft Systems, Inc. | Victor Naidu

In this podcast (download iPod compatible, 49MB), Victor Naidu and I continue our conversation about innovating ahead of the curve. A surprising twist Ramsoft took in the late 1990's was to get into the Enterprise Resource Planning (ERP) business. ERP is essentially a form of packaged software for the enterprise, and one might not think much innovation is involved. Remarkably, we then relate ERP to tying together components over the Internet. Highlights of the conversation include:

• ERP filled a gap in the market place, one of Victor's innovation themes, for companies wanting to avoid the Y2K problem and also get out from under the increasing maintenance costs for their legacy system.
• Quite a bit of customization is involved in installing ERP systems. Companies might pay $1 Million to purchase the software but $10 to 15 million to customize it.
• The high cost of customization frequently comes about from companies' attempts to alter the software to match their specific business practices. Little wonder that Nick Carr suggests that a major way to trim IT expenses is to minimize customization.
• Victor views ERP as just another means of rapid application development to create services that meet company needs.
• Now, these sorts of services are starting to be created over the Internet.
• Victor's observation is that the Internet enables true global sourcing of business services. See our conversation with Jimmy Hsiao for a discussion of technical and cultural limitations on that observation in the case of China.

Victor Naidu discusses how he has managed Ramsoft since 1992 when he founded the company with his wife. He describes the process as anticipating the technology sweet spot sufficiently ahead of the curve of mass adoption. At that point, the need for the technology is clear but exactly how it fits in with individual businesses is not. Innovation comes in discovering the nexus between business needs and technological capabilities.

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Filed under: Finding Gaps | Information Technology | Ramsoft Systems, Inc. | Software | Southfield, MI | Victor Naidu

In this 8 minute podcast (download iPod compatible, 42MB), Victor Naidu and I begin a fascinating conversation regarding how his company, Ramsoft, has innovated in IT consulting. Victor and his wife began Ramsoft in 1992, initially focusing on a cutting edge software methodology, rapid application development. Later in the 1990s, Victor moved on to the Internet and Enterprise Resource Planning software.

After outlining the company's history through the 1990s, Victor reflects on when it is best to enter a market:

• Being a market leader is good because customers perceive you as an expert and are willing to hire you as such.
• However, it is not good to create the market because you will have to wait too long to actually get a return on your investment.
• Entering the market near the stage of mass adoption guarantees low returns as the service is commoditized.

In our next conversation, we will discuss how Victor applied this philosophy to entering the ERP market.

Additional Links

• Wikipedia provides a description of Rapid Application Development.
• This Wikipedia article provides a good account of ERP software, used to integrate enterprise systems.