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The Smart Techie was renamed Siliconindia India Edition starting Feb 2012 to continue the nearly two decade track record of excellence of our US edition.

February - 2007 - issue > Cover Feature

Creating Value By and For Design

Srini Rajam
Thursday, February 1, 2007
Srini Rajam
We live in a world where physical assets are often under-stood and valued better than the idea or knowledge that helps to create them. For example, when planning for the acquisition of a house, the land cost and construction occupy the mind so much that we tend to ignore the value of the “design” created by the architect.

The Indian IT industry has traditionally been built on the strength of software services. This is understood very well by all the players, and most importantly by the customers. The business model is based on well-defined aspects such as resources, dedicated teams or task completion. Six years ago when Ittiam’s founding team launched the company with the passion to build a world-class technology product company from India, we thought hard on the business model. It was clear that the services model would not yield the deserved value. We had to distill our thoughts on what exactly we wanted to sell to our customers and how we wanted it to be valued. Finally, it was quite clear – it had to be the “design”, which incorporates one or more intellectual property (IP).

When building a design-based business model, I believe there are two key elements. The first is how to make the design highly differentiated and second is how to receive fair value for it in the market. The first element is discussed here as “Value By Design” and the second as “Value For Design”.

Value By Design – Differentiation
Differentiation is a set of features that customers regard as both important and superior to what is offered by the rest of the world. What this means is that the design should not only have better performance than competition but it should also have that in those areas which are considered as critical by the customers / market. The last aspect is sometimes forgotten in our intensely technology-driven decision making, causing us to create superior design performance in areas that customers do not care about. Thus it is always necessary to begin the design effort with a very clear understanding of what the customers and markets want. During the design process, we make many decisions and trade-offs. The primary framework for making those decisions should be customer and market requirements.

Achieving superior performance is a big challenge by itself and depends largely on two strengths: the depth of competency of the technical team and the foresight with which the design benchmarks are set. The first deals with a very simple fact. For example, if we want to create the world’s best digital video processing design we need to have the leading digital video engineers in the team. This is a game of expertise, and there will be no substitute for it the competitive playing field. Thus a company’s strategy of differentiating by design and its ability for attracting the best talent in that target area are wholly linked to each other. The second aspect dictates that the success of even the most capable team depends on them pursuing the right goals. In an environment where design cycle times are lengthy and the speed of competition is both threatening and unpredictable, the design benchmarks have to be set very high and with the foresight to intercept the market at the right performance levels.

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