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Software/IT Services/Business Process Outsourcing
A Training Spinoff
In the early 1990s, as HCL America tried to crack the U.S. market, the new HCL unit
had quality problems with the technical, language, and other skills of some of engineers
coming from India. In response, then-CEO Yogesh Vaidya formed and later spun out a
training company, Software Technology Group (STG), to improve the Indian engineers’ technical
and business skills.
Over time, STG also began training laid-off U.S. engineers for software jobs and established an
authorized education center for Microsoft. Today, Vaidya remains CEO of STG and divides his
time between San Jose and India, where he has established more than 100 “Final Touch” training
centers for Indian engineering graduates at Tier 2 and 3 schools to prepare them for global
software positions.
Vaidya points out that while graduates of India’s Tier 1 and Tier 2 engineering schools rank with
the best in the world, many others lack the soft skills to be employed by global companies, a
critical gap also identified by McKinsey Global Institute. Tapping into a major market, he expects
300 training centers to be operational by 2010. STG has also begun offering English language
training for graduates wanting to work for multinationals, as well as a six-month intellectual
property protection program with the University of Washington, designed for technologists,
with courses remotely offered from the U.S. to classes in New Delhi, Mumbai, Bangalore, and
Chennai.
While India has enormous resources, Vaidya doesn’t see a time when Silicon Valley engineers
will lack for jobs. “The real innovation takes place here. The problem is that not enough people
here are going for engineering careers.”
Not All Indian Outsourcing is Indian
Dan Easterlin and John Simpson, working in very different areas of the Bay Area enterprise
software sector, saw a potentially lucrative niche in IT outsourcing services for the
insurance brokerage industry. They seized the opportunity in 2005, launching San Carlosbased
Patra Corp.
The two men had worked together years earlier at a software services company acquired by
Ceridian, and they then crossed paths again at Ask Jeeves. “We were both tired of working in
software and IT services, where there was a constant drive for sales without any real sensitivity to
the customer,” Easterlin says. In his nearly 4 years at AAA, he had learned about auto insurance
from the carrier side. Simpson had run an Internet IT support system for large skyscraper construction
projects where insurance certification of subcontractors was critical.
They saw a potential niche in providing insurance brokers with IT and outsourced staffing support
for certain time-consuming back office tasks with high error rates, such as: certifying that
contractors have proper insurance coverage to lease property, hold events, operate equipment,
perform specific work, etc.; loss run orders (obtaining a prospective customer’s record of prior
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