Friday, September 22, 2006

THOMAS L. FRIEDMAN: Anyone, Anything, Anywhere

Montevideo, Uruguay

The New Yorker once ran a cartoon by Peter Steiner of two dogs, with one sitting at a computer keyboard saying to the other, “On the Internet, nobody knows you’re a dog.”

Nobody also knows you’re Uruguay.

A tiny country of three million people, wedged between Brazil and Argentina, Uruguay has come from nowhere to partner with India’s biggest technology company, Tata Consultancy Services, to create in just four years one of the largest outsourcing operations in Latin America.

Yes, when Tata’s Indian employees in Mumbai are asleep, its 650 Uruguayan engineers and programmers now pick up the work and help run the computers and backroom operations for the likes of American Express, Procter & Gamble and some major U.S. banks — all from Montevideo.

How did this happen? One of the most interesting features of this era of globalization is how any entrepreneur — with the right imagination, Internet bandwidth and a small amount of capital — can assemble a global company by matching workers and customers from anywhere to do anything for anyone. Maybe the most important rule in today’s increasingly flat world is this: Whatever can be done, will be done — because so many people now have access to the tools of innovation and connectivity. The only question is: Will it be done by you or to you?

Gabriel Rozman decided it was going to be done by him. A retired partner from Ernst & Young who was raised in Uruguay, he hatched the idea of partnering with Tata to make Montevideo a global outsourcing hub. He did not have a single client or employee when he approached Tata. He had just two things: a gut instinct that Uruguay’s quality education system had produced plenty of good, low-cost engineers and a gut desire to do something good for Uruguay — the country that gave his Hungarian parents sanctuary from Hitler.

Four years later, TCS Iberoamerica can’t hire workers fast enough. When I visited its head office, people were working on computers in hallways and stairwells. (Mr. Rozman also oversees 1,300 employees in Brazil and 1,200 in Chile.) It turns out that many multinationals like the idea of spreading out their risks and not having all their outsourcing done from India — especially after one big U.S. bank nearly had to shut down last year when a flood in Mumbai paralyzed its India data center the same day a hurricane paralyzed its Florida operation. And there is no risk of nuclear war with Pakistan here.

“When I first approached this big U.S. bank to outsource some of its services to Montevideo, instead of India,” recalled Mr. Rozman, “the guy I was speaking with said, ‘I don’t even know where Montevideo is.’ So I said to him, ‘That’s the point!’ ”

Another factor, added Mr. Rozman, was that multinationals that were depending on Indian firms alone to run their backrooms 24 hours a day were getting the third team for eight hours, since the best Indian engineers didn’t want to work the late-night shift — the heart of America’s day. By creating an outsourcing center in Montevideo, Tata could offer its clients its best Indian engineers during India’s day (America’s night) and its best Uruguayan engineers during America’s day (India’s night).

Most employees here are Uruguayans, but there are also lots of Indians sent over by Tata. It produces both a culture shock — Montevideo doesn’t even have an Indian restaurant — and a cultural cacophony.

The firm runs on strict Tata principles, as if it were in Mumbai, so to see Uruguayans pretending to be Indians serving Americans is quite a scene. Said Rosina Marmion, 27, an Uruguayan manager, “Our customers expect us to behave like Indians — to react the same way.”

Also, Latin culture, unlike Indian, is very nonhierarchical. “The Indians were not used to someone who says ‘no,’ ” explained Ricardo Zengin, 34, a systems analyst. But eventually, “they understand that you are not saying it to challenge their authority but because you think it can be done better another way. ... In Latin culture, everything involves a discussion.”

Uruguayans tell a joke about themselves that goes: If you get diagnosed with a terminal illness, move to Uruguay immediately because everything happens 20 years later here.

In outsourcing, though, Uruguay has leapt ahead of its neighbors by being the first to understand what could be done — that in today’s world having an Indian company led by a Hungarian-Uruguayan servicing American banks with Montevidean engineers managed by Indian technologists who have learned to eat Uruguayan veggie is just the new normal.

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