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"A Company Cannot Be Run Like A Club!
Karthik Sundaram
Dr. Santanu Das is the current president and CEO of TranSwitch Corporation in Shelton, Connecticut. He held several positions prior to Transwitch Corporation including, President of Spectrum Digital Corporation, a telecommunications equipment company. Before that, he held various executive positions, including Director, Applied Technology Division of ITT Corporation's Advanced Technology Center in Shelton, Connecticut. He did his B.E and M.E degrees in Electronics and Telecommunication Engineering from Jadavpur University, Calcutta and his Doctor of Science (D.Sc) in electrical engineering from Washington University in St. Louis. He has also authored more than 25 papers in different journals, magazines, and conference proceedings. For his outstanding achievement, Dr. Das received 'Alumni Achievement Award' and 'Distinguished Alumni Award' from Washington University School of Engineering & Applied Science and Alumni Board of Governors of Washington University on 2000 and 2001 respectively.

Dr. Santanu Das (who describes himself as "only a mere mortal"), has been at the helm of TranSwitch Corporation (NASDAQ:TXCC) since he and two other associates founded it in December 1988. It might not be the best of times to be the CEO of a semiconductor company, yet despite current business conditions, Dr. Das has the confidence in his Company and his team that TranSwitch will emerge as an industry leader after this unprecedented telecommunications downturn. His views on leadership:


Managing Risks:

In the early years of TranSwitch it was a bit different to run a company with very little money. The day we went public we still had close to $3 million in the bank. Two years after our IPO, the Company still did not have a stick of new furniture. We spent money on a very conservative level and our offices were remodeled only to meet expansion needs. Mike McCoy, the Chief Financial Officer at that time, and other senior team members would become unpaid contractors on the weekends to do the maintenance and expansion projects. While the business itself was a risk, we did not choose to add to that by being lavish. TranSwitch was always very successful in raising money. Our strategy was to raise money when we didn't need it and also to raise more money than we thought we needed. This strategy proved to be very successful for us. We grew the business by conserving our resources but expanding our sources. Where is frugality these days?

If you look at the way we have developed our business model, we like to work with leading edge but not bleeding technologies. It reduces our business risks far more than if we were to work at the front end of the technology spectrum. For instance, the use of standard C-MOS processes we have adopted has helped us in developing very cost-effective products; we stayed away from very exotic processes.

On CEO Longevity

Shareholders, employees, customers, suppliers, and local communities form the important constituencies of a public company. One of my jobs as CEO is to ensure that these constituencies' needs are met in a fair and balanced way for them as well as for the Company. If I am successful in managing and meeting their needs, a strong sense of stability grows within the entire company and community, which should result in a longer tenure for the management as well as for the company itself.

Today's CEO must also keep in mind that becoming a global company brings cultural differences that may have a significant impact on the operations of the company. The beliefs and values of one nation differ from another, yet the CEO has to deliver the same levels of satisfaction to the local constituents of the company.

This is where I see the CEO playing the role of a "Rathi" (charioteer). The rathi guides the chariot true and safe, even in the heat of a battle. He is not shaken by assault, nor is he influenced by the outcome of the battle. He keeps his eyes on the path and drives horse, man and warrior safely through the storm. In TranSwitch, the employees are the warriors and the CEO is just a charioteer.

On Leading An Enterprise

I think an entrepreneur cannot and should not be just a manager. An entrepreneur is and has to be a dedicated leader. A leader should be able to set the direction and make sure the team is aligned with the overall organizational goals. This alignment should not be and cannot be forced; it should be accepted as naturally as the job itself. Have you ever tried raising funds by pitching an idea to a venture capitalist (VC)? Chances are you would fail miserably if you try to sell your way. What VCs are looking for is vision, and the more they are aligned to the vision and the strategy of the start-up; the better is the chance of raising money.

Our early investors at TranSwitch believed in our vision, and this alignment of vision has helped us enormously. This alignment extends to our suppliers, customers, and even our landlord! In fact, our landlord was our first investor because he believed in our vision and strategy so strongly that we didn't pay rent for our first 18 months of existence. This commitment to vision for the entire team makes a better organization.

On Hiring A Team To Execute The Vision

If you draw a matrix where education, skills and experience are plotted on the X-axis and attitude, personality and passion are plotted on the Y-axis, you have the basis for team building. The person who scores high on all six attributes is an ideal candidate. Unfortunately this person doesn't exist. We try to hire on a more realistic level. If you offer me a choice: a candidate who scores high on education, skills and experience, but low on attitude, personality and passion, and another candidate whose scores are reversed, I will choose the second candidate. We can always build skills, educate and provide experience. The other three are inherent. These inherent qualities make it easier for the candidate to align himself or herself to the vision and the execution plan of the company.

On Motivating a Team

I am not sure if I alone can motivate somebody. That, I think, comes from within. I can demotivate you easily, but to motivate one is a difficult task. We can create an environment for motivation, yes, but that is all we can do. From the beginning we built a company with the idea of leaving behind a legacy. Profits, while important, have not superseded the value of this legacy. And that is how we built the team.

Until recently, the only reserved parking space in our parking lot was that of the Employee of the Year. Even though I am the President and CEO of the Company, I had to drive around looking for an empty spot every day. This fairness in everything that we do extends to each person in the company.

Every employee's child over 16 years of age is eligible for a summer job at TranSwitch. I think it is important for families and the next generation to know what the family member working at TranSwitch is doing.

On Having Achieved Goals

We have built the culture that we set out to achieve. At the height of the dot.com and telecom boom, we had an attrition rate of less than 2 percent. Our culture pervades everything we do. And this consistency of culture has helped build TranSwitch into a challenging but fun place to work.

Gone are the days when you can confidently say that you have built a company to last. Giant corporations are falling by the wayside. Technology is changing so fast that even the nimblest of companies are hard pressed to keep pace. I think we have not yet achieved what we want in this respect. In a monopoly or an oligopoly, it is easy to sustain a business. In an unregulated market, it is a lot harder to build a company that will last. I am sure you recall Digital Equipment Corporation. Therein lies the challenge!

On TranSwitch's Future

We have come to the conclusion that we are back to being a start-up. The only difference this time is that we have a veteran team of employees, an established customer base, a second-to-none infrastructure, plenty of cash, and a tremendous amount intellectual property. The industry is going through what many call a "perfect storm," where a shakeout is in process. How do you rebuild after the storm? With your spirit - of course!

On Corporate Practices

Our practice has always been built around an old-fashioned public company model, even in the days when we were private, and this strategy has helped us to succeed. Our books are clean and the collective conscience is clear. We have a very strong management team in place and our employees are the best in the industry. I believe leadership is leading by example and the senior management projects this and the employees embrace it.

On Indian Companies Becoming Global

I think the root cause that prevents some Indian companies from becoming a global player is the lack of strategic vision. They are very good in operations and technology, but it takes clarity of vision and unshakeable focus on strategy to achieve business results.

The freedom to innovate is another area that I find to be restricted in the Indian corporate culture. Innovation requires an open atmosphere so that employees can freely conceive and execute an idea, similar to that of the Bell Labs' culture, which was ideal for innovation. I find this scenario to be quite the opposite in the Indian corporate culture. The management team at Bell Labs was eager to allow employees the ability to innovate and fostered a culture of "free" thinking. The Indian corporate culture does not nurture this type of freethinking environment partly because they do not have the resources.

On TranSwitch Succession

There are enough people here at TranSwitch who can seamlessly assume my position. We have built a strong management team and there are many candidates who can step into the role as President and CEO.

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