'Talent is great in India'

Microsoft's India Development Centre has embarked on its next phase of innovation and growth with 1,000 employees on board.

MSIDC plans to double its headcount over the next three years and progress to drive Microsoft's next generation product initiatives from India.

MSIDC unveiled its future plans even as it reached a significant milestone with the hiring of its 1,000th employee. The Hyderabad Development Centre, the largest outside of Microsoft's Redmond facility, has witnessed impressive growth over the last eight years -- starting as an R&D centre with 20 people working on two products in August 1998 -- to what is today a creative force of 1,000 innovators working on over 50 products.

The state-of-the-art product development centre has grown as a strategic asset to the parent company, driving Microsoft's global product innovations from India for developed and emerging markets.

In an exclusive interview with Syed Amin Jafri, MSIDC vice president and managing director Srini Koppolu talked about the genesis and growth of this prestigious only-of-its-kind centre outside Microsoft's headquarters at Redmond, United States.

He also disclosed the MSIDC's growth plans in the next few years. Excerpts:

Please tell us about the origin and growth of MSIDC.

Microsoft India Development Centre started in August 1998 with a group of 20 people. MSIDC focuses on strategic and IP (Internet Protocol) sensitive software development projects.

It is the second biggest Microsoft development centre outside Redmond (the Microsoft headquarters in Seattle, US) and works closely with all the business lines of Microsoft.

We think of our history in three phases. Between 1998 and 2002, we built, developed and shipped our first end-to-end product -- services for Unix 2.0; between 2002 and 2004, we scaled multiple operations and aligned very closely with the seven product segments.

We also had Bill Gates visiting MSIDC in Hyderabad in 2002. From 2002 onwards, we have accelerated incubation efforts and are in growth mode on several major projects.

In November 2004, Microsoft CEO Steve Ballmer inaugurated the Microsoft Campus at Gachhibowli.

What prompted Microsoft to locate its first offshore development centre in India? Any peculiar reasons for locating it in Hyderabad?

Microsoft has been in existence for 30-plus years. Product development was basically centralised in a way in one place. Ninety-nine per cent of product development was happening at Redmond and nowhere else.

Slowly, we opened small development centres at a few locations in the United States. Then Microsoft took a decision to start the development centre in India. Several factors guided Microsoft's decision.

The Indian software industry started picking up and more and more people started graduating in computer science. Also many Indians flourished through the dot-com boom. In the company (Microsoft) itself, over the years, many Indians joined and have been doing great work.

All these factors gave us a strong feeling that India is a good place to start a development centre.

We can tap this top talent we have seen in the US. There is lot of talent in India and the best way to attract them and get them into our company is to have a development centre in India.

Based on this logic, we started the development centre here in 1998.

I worked for almost nine years in the United States (since I joined Microsoft in 1989) in various product development groups before coming to India to launch this centre. I know very well what it takes to build Indian products. And that is the core principle behind this organisation.

How do you go about your task of developing MSIDC as a vital part of Microsoft's strategic growth?

We are engaged in product development, incubation and thought leadership. Software development at MSIDC covers overall responsibility for product delivery, engineering and technical architecture using cutting-edge technologies.

Besides, MSIDC also works on sustained engineering projects to support enterprise customers on Microsoft platform.

Typical projects are a mirror of software development at Microsoft in Redmond.

MSIDC is built on innovation. The centre is in an extraordinary position to deliver great value to customers in both the developed world as well as the emerging markets through a broad set of technologies.

Our efforts on RFID technologies are an example of how we have conceptualised and executed an idea end-to-end from India. We have built several centres of excellence at MSIDC -- notable are networking, storage and mobility centres.

Having worked closely and successfully with Redmond teams, MSIDC is seen as a leader in shared product development. We are also working closely with our partner ecosystem to build a product mindset in India.

How do you view MSIDC crossing the milestone of hiring its 1,000th employee?

We reached this important milestone by taking a strategic and thoughtful approach to our growth and building an organisation fully focused on end-to-end product development.

At MSIDC, India's top talents along with the people from Microsoft Redmond are driving core global product development. I am proud of my team and proud of what we have achieved so far; the future looks even more exciting.

I can say the talent is great in India. We are happy with the smart people that we are able to hire. More and more people are moving back from the US to India after gaining experience in product development.

They are finding great opportunities in India and working on cutting-edge technologies.

What has been the contribution of MSIDC so far?

MSIDC has developed and released many core products and technologies to the global markets. One of the unique aspects about MSIDC is the end-to-end responsibility that teams in India have for every product, feature or technology they develop.

The teams own the strategy, gather customer requirements (no matter where they are in the world), create multi-vision release plans, architect, design, and test and release the software product to the market.

MSIDC has one-fourth of its engineers working on Windows Vista and Longhorn Server. MSIDC has also established itself as a mobility centre of excellence having full responsibility for Office Communicator Mobile, SQL Mobile (recently renamed SQL Everywhere), Office Mobile and Visual Studio for Devices. 

As I stated before, Microsoft RFID platform, now under development at Hyderabad, was successfully incubated by MSIDC.

The centre fully develops the data protection manager product, and the business leadership is also with the team in Hyderabad.

The teams have added many significant features to Visual Studio, Visual Studio Team System, Windows One Care Live, MS-CRM, Office Live, developed platform components for MSN and expertise on Real Time Collaboration, education, gaming and services businesses.

They also demonstrated their expertise in integration of Microsoft Office applications with back-end ERP systems by developing Microsoft Dynamics SNAP and Duet for Microsoft Office and SAP.

The product and technology innovations that have come out of this organisation have had a significant impact on all of Microsoft's key businesses.

As the MSIDC continues to grow and expand, it will play a critical role in Microsoft's future business. What is the track record of MSIDC in patents?

Another indicator of our impressive growth is the number of patents that we have filed. MSIDC is a leader in creating intellectual property from India. Two years ago, we started paying attention to this aspect. We filed 40 patents last year. In the current year, we have filed 70.

In the coming fiscal, starting on July 1, we will be filing 100 patents. As you see, we are gradually scaling up. As we scale up more, there will be that many more brilliant minds working on important problems that will result in IP creation, almost in correlation to the size of the organisation.

What are the future plans envisaged by Microsoft for the India Development Centre?

We will continue to scale up the organisation and grow, and whenever we find great people, we will hire them. We think we will be able to double our headcount over the next three years. We took eight years to reach the 1,000 mark.

Probably, it will take only three years to reach the next 1,000 mark.

Will the MSIDC expand the product range it is working on?

The goal is not to keep adding more and more products. The goal is, of course, having strong expertise in centres of excellence, driving more and more businesses and innovations.

The existing product range of 50 will not double when we reach a headcount of 2,000. The focus will be on how can we do more in the areas we are already operating so that we can build depth in the organisation.

Thus, our goal is not to have much bigger portfolio of products. The goal is about having deeper knowledge and expertise in each one of these area.

What kind of investment has Microsoft made in the development centre so far?

We won't be talking about investments or our contribution to specific businesses. As a company, we are investing in different initiatives.

Research and development is one aspect. When Bill (Gates) was here last year, he talked about $1.7 billion investment, which goes into many different initiatives in India.

MSIDC is one part of these initiatives. The way I look at it, we will continuously scale up and whatever investments are needed to support organisational growth, will be made.

The popular perception is that Microsoft located its centre in Hyderabad after the then Chief Minister N Chandrababu Naidu requested Bill Gates to do so. Another perception is that Bill Gates announced further investments in MSIDC after the present Chief Minister Dr Y S Rajasekhar Reddy wanted him to scale up the operations here. Your comment.

The company will not make this kind of critical decisions like setting up an R&D organisation or scaling it up based on the requests of specific governments. When anything falls in place, there are different parameters. Definitely, how proactive the government is about creating infrastructure for attracting major projects. But there are other critical parameters that we look at before taking on investments like these.

It is very positive for Andhra Pradesh that even though the government has changed, the overall philosophy and the policy of being proactive about attracting industries into the state and investing in infrastructure remains the same.

That has happened at the central level also. The government has changed but the overall philosophy of growth-oriented approach is being continued. Definitely, that is a great thing for us.