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Subu Kota: The Boston Baron
Karthik Sundaram
Wednesday, June 25, 2008
“OH! PLEASE DON’T GIVE HIM ANY MORE IDEAS,” implores Virginia Kota, as she drives me and Subu Kota to Logan International Airport in Boston, MA. Kota, founder and Chairmain of the Boston Group, is on his way to Hyderabad, to launch his new venture—Boston BIO, a services company for the biosciences industry. This is Kota’s latest venture—an entrepreneurial evolution that has spanned three decades now, since Kota came to the U.S. in 1968. On his office wall is a replicate of a story from the Boston Globe. “When we did that story in 1993, the author laughed even as I told him that the IT jobs would soon move to India and other developing countries,” recalls Kota. It turned out Kota was right—compellingly so. “When I was with Data General, I noticed that a lay-off meant the people went away, but the projects didn’t go away. And many times, the people simply came back as consultants to finish the project. How sensible was that?” asks Kota, who had spent close to two decades with the company, before heading out to lead the Boston Group, now into its fifteenth year.

Entrepreneurship is a coat that hangs well on Kota. Right out of his graduate school in ‘68, Kota pulled in some angel investments to form Password Systems, that was designed to bring accounting and daily business management tools to the desktop. Kota proudly points to the company’s existence still, while he moved on after seven years with the start-up to join Data General, where he spent the next 17 years. “I did take a couple of years off,” says Kota, who had also been dabbling in real estate investing during his stint at Data General. “The saner half of my life—Virginia—insisted that I be focused on one thing at a time,” laughs the chairman of the Boston Group. After streamlining his real estate investments to manageable sizes, Kota went back to Data General and finally moved out again in 1988 to begin the Boston Group (TBG).

“The consulting business has a very low barrier to entry—and in return, offers very little stability to any player,” comments Kota, who began TBG as a staffing firm and has added mature consulting prowess to the company’s capabilities. “Consulting will not go away, unlike what the industry oracles proclaim, nor will the big players be able to take over the entire market—it is just not possible in any service industry.” Now spanning financial, banking, and insurance industry projects, the group has also added capabilities to serve the pharma industry. IT still remains, observes Kota, a human-specific entity, where the knowledge and familiarity with a project or process still resides largely within the employee’s mind, and is lost when the employee is let go or moves on. Kota experienced this at Data General and has heard the client distress too. In this Kota saw the next opportunity in the learning business. “We created some at-site learning tools for clients to help their employees share information and knowledge that could help the enterprise leverage such human-centric resources, and then worked outside of these project to create the very successful Intralearn, TBG’s flagship e-learning portal.

The e-Learning Focus
“The Internet has played a positive role in the distribution of information and knowledge,” observes Kota, “and the learning industry is going to change forever. Physical contact is not going to be a constraint in the process of gaining knowledge anymore, and this is going to be a huge disruptive force in the developing countries too.” Kota seems to have hit the spot again with Intralearn. When the SARS shook up the Far Eastern countries and laid waste precious calendar days for the educational business, many institutes switched to the Intralearn portals to continue their work. After a thorough evaluation of the major, competing, e-Learning solution providers in the worldwide e-Learning market, China Human Capital Management Co. (ChinaCHM) finally selected the IntraLearn platform because of its modular design, robustness and scalability. “These technology attributes were key to the final delivery of the eUIBE distance education platform,” says Dr. Xue Gen Cao, Executive Vice President of Global China Group Holdings.

The platform combined proven technology from IntraLearn with localized software modules that are unique to eUIBE's operational and business model. “The student registration, schedule management and other workflow found in Chinese universities is significantly different from that found in U.S. universities; therefore, creating this customized platform was the only way to effectively deliver distance education to the Chinese students,” says Cui Fei, New Business Development and Technology Director of Global China Group Holdings. Another important feature of the platform is that it complies with all the major international e-Learning standards such as AICC, SCORM, and IMS. This enables the platform to integrate seamlessly with standards-compliant courseware from major international courseware developers.

The portal business has signed up a slew of new clients, including a recent deal with the AMA University in the Philippines, that has a student population of 150,000 and more than 200 campuses located in the country and in other Asian countries. In the latest of its successes, TBG signed up the French retail giant, Carrefour, as its client in Thailand to execute simulated training content for its supply chain management software.

The development of the simulated training content is aimed at increasing the consistency and effectiveness with which training is delivered to Carrefour’s employees to increase their proficiency levels in using the SCM software. This will also help in considerably reducing the time a new user would take to certify on Carrefour’s SCM system. The training content will be developed in 7 Asian languages and English to be deployed and used by more than 20,000 users across Carrefour locations in Asia. The initial implementation of the project is being done at Carrefour, Thailand (Cencar) and expected to be rolled out in the other regions as well.

Kota has moved on to other applications as well. ETS/FinancialCampus, the education and testing body that certifies Series 5 and 7 examinees, uses Intralearn for its programs. “Considering that only 20 percent of American students take up full time credits, on-line learning is on the threshold of explosive growth,” predicts the chairman.

Behind Biotech
Perhaps one of the best kept secrets of Kota’s entrepreneurial successes is that of his co-founding Shanta Biotech in Hyderabad. Kota lost his brother to Hepatitis-B. “I knew nothing about this disease, but his death drove me to find out more about its prevalence,” recalls Kota. The high numbers in India and the apparent lack of viable vaccines snapped another idea into Kota, and he began a decade-long exercise to produce a vaccine under the dollar. Today, the biotech (a nebulous definition) firm is a leading supplier to many of the larger drug firms in the U.S. Shanta also helps in the phase trials of drugs for U.S. pharma firms, as an established contract research organiztion (CRO).

In his current sojourn within India, Kota is firming up his launch of Boston Bio, which would offer chemistry services for the labs within the U.S., and speed up the discovery process in the pre-trial phases. “Biotech is in the “silent movie” era in India, where the industry has to develop many standards in the delivery models—protecting IPs, ensuring client privileges, and maintaining a world standard of ethics,” comments Kota. “Applying principles of offshore IT consulting will not work. At Boston Bio, we are bringing the experiences of Shanta biotech to help us set up very mature processes, and are patient enough for the clients to verify our deliveries.”

Baron Speak
In the nearly four decades that Kota has been in business, he has seen the country through two previous recessions. “This time around, people are not ready to accept the reality that we are in a recession,” he says, with a wry grin. “The country is caught in a time warp and is still in disbelief that the glory days of the Internet are over...though the glory days of the Internet is yet to come.” Kota is bidding on the next level of percolation of the Internet—societies and countries that will come up to speed with the rest of the connected world, driving more opportunities to the ever-creative American continents. “The connected society is going to throw up many more opportunities for people to learn new skills online, and revise their methods of thinking again—innovation will take a full circle again.”

Kota spills abundant energy and optimism into all his projects, and believes in putting together a team and letting it loose. “You set expectations and most times, you would be surprised how easily your team surpasses them—as long as you give them the framework to perform their best.” With a 250-strong team in India, and a 1000 people employed world over in 5 countries, Kota has managed to stay north in revenues, year-over-year. Not an easy job, when you stay in the U.S. only for a month and are traveling to another country the next month. “Believe in your team, and it will believe in you,” opines Kota. “It has worked wonders for us. Leadership is about encouraging your team to set positive goals, and giving them ample space and opportunities to go achieve them. Good leaders are good believers.”

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