Godfather of KPO and McKinsey Director Anil Kumar Arrested
Perhaps a little bit of history is in order in this case. Kumar, who was arrested with a number of other executives earlier today in the same insider trading scandal, was no typical consulting partner. As mentioned above, he was a leader and innovator in the area of knowledge process outsourcing. According to the book Information Systems Outsourcing: Enduring Themes, Global Challenges, and Process Opportunities edited by Rudy Hirschheim, “The international consulting firm McKinsey initiated a project in 1995 led by Anil Kumar to exploit reductions in global telecommunications rates that would create opportunities for 'remote business services' … this led McKinsey to establish a knowledge center in Delhi whereby staff and researchers would develop models and analyse trends for McKinsey consultants worldwide.” Another Director, who I used to work closely with at FreeMarkets, Jane Kirkland, ran McKinsey’s global knowledge management operation (including overseeing the Delhi operation). And Amit Bhatia, who reported to Jane from Delhi and later served as our Indian country GM at FreeMarkets, ran the research operation for McKinsey in Delhi.
Both Amit and Jane were big fans of what the offshore model did for McKinsey’s ability to leverage existing intellectual property (e.g., research, frameworks, etc.) not to mention to rapidly turn around analysis to make their entire consulting organization more effective and profitable, allowing Western teams to deliver more quickly. This model has particular relevance in the procurement and supply chain sectors when it comes to researching such areas as global supply markets, commodity research, hedging strategies, running financial analyses, building financial models, and classifying / analyzing spend data, etc. More recently, many other offshore providers (e.g., Smart Cube) have tried to emulate -- sometimes successfully, sometimes not -- what Kumar, Jane and Amit originally created. But in the case of the copycat models, they're doing it both for end user clients and other consulting firms who leverage these KPO back offices.
In any event, I suppose only time will tell whether or not Kumar is convicted or exonerated. I suspect given the fact that McKinsey so heavily vets those moving into a Director level role -- on all levels, including the character of the individuals up for promotion -- that there is a reasonable chance that Kumar might be found innocent if his past behavior is any indication of the ethics he brought with him into his Director role. Regardless, one thing is most certainly for sure in this case and potentially others like it. And that is the fact that consultants should never compromise client data or trade -- or encourage others to trade -- on insider information. Granted, the compliance function at strategy consulting firms is usually not as tight as it is at an investment bank or a large accounting firm, but perhaps it should be.
- Jason Busch
"Robert W. Moffat, Jr. is senior vice president and group executive, IBM Systems and Technology Group. Named to this position in July 2008, Mr. Moffat is responsible for all IBM hardware offerings as well as the microelectronics division, which translates IBM research and development into semiconductor solutions for IBM systems and OEM clients. In addition, the company’s integrated supply chain operations, which include global manufacturing, procurement and customer fulfillment, report to him."
From Reuters.
"From approximately August 2008 until around October 2008, Rajaratnam, Kumar and others engaged in insider trading based on Inside Information pertaining to AMD. Kumar obtained Inside Information regarding certain of McKinsey's , including AMD, and communicated it to Rajaratnam in violation of duties of trust and confidence Kumar owed to McKinsey and its clients. For example, on Aug. 15, 2008, Kumar told Rajaratnam that the parties to a deal involving AMD had "shaken hands," and that Rajaratnam could "now just buy" AMD stock. Rajaratnam then shared this information with Chiesi. On Sept. 11, 2008, Kumar told Rajaratnam that the deal involving AMD was "gonna be October, first week." Rajaratnam caused the Galleon Technology Funds to trade on the basis of this Inside Information, and Kumar stood to benefit because he was a direct or indirect investor in one or more hedge funds affiliated with Galleon."
The last time I dealt with a McKinsey know-it-all he wasn't buying our idea for bank portfolio diversification. His clients didn't either. All gone.
What disturbs me is there is a TLA for KPO, and that you can type the title of a book called, "Information Systems Outsourcing: Enduring Themes, Global Challenges, and Process Opportunities" without cracking yourself up or sprouting horns on your head.
Yes, I'm in management too, and yes I hate unions, but can't you realize what all this crap is doing to America? Not everybody can work at McDonalds (all the illegal aliens already have those jobs anyway). I say hang the guy for the KPO. Screw the insider trading.
http://www.boston.com/news/local/massachusetts/art...
“…The process is in its infancy still. But remember that most H1-B visa holders will become US residents, and bring over several family members too. Something similar will happen in Germany and other Western countries. So, in a few decades, we can look forward to the creation of a huge global brainpower network of 50 million people of Indian origin. These will constitute a tiny fraction of the global population, but a big slice of the influential global population. “
“…They will matter in academics, business, stock markets, law, medicine and the arts. And so they will matter in politics too…”
Now that they have access to our financial data, they will use it to enrich themselves.
Fight offshoring and outsourcing to India. This is our data, and we deserve to have it in our country.
And didn't Matt Tiabi of Rolling Stone imply that packs of Indians working at investment banks sliced and diced the derivatives that caused the sub-prime meltdown?
Finally, no need to play the race card. The Indian offshoring lobby started the rhetorical race war by deeming Americans too stupid to do "maths".
Americans should wake up to this invasion.
http://www.businessweek.com/bschools/content/jul20...
IBM, what can you say? They have become the scum of the corporate world. Layoff Americans and hire H1b's is their motto.
However, tarring the entire Indian diaspora with one brush shows limited thinking in this forum .. the prosecutor himself (Preet Bharara) is also Indian-American.
PS. Sanjay Kumar (Comp. Assoc. CEO who went to jail) is Sri Lankan, just like Rajaratnam.
Now we see the connection. That is why IBM is referred to as "Indian Bowel Movement".
To equate Sri Lankens with Indians is the equivalent of calling a Mexican a Canadian.
I sincerely hope that the conversation rises above this level. It is clear why some readers of this are looking for jobs ...
I love it ... IBM = Indian Bowel Movement. Bravo!
trust me only hire native Americans
Stephen Smith -- you aren't worth a comment. Please go away.
Even though we are a nation of immigrants, each successive wave of immigration throughout our history has encountered the same sorts of hostile feelings from those who feel displaced.
1. Demand credit for your work. If co-workers aren't capable of doing the work, document it, force a change, or move somewhere you can. It's America.
2. If you are Ivy with technical expertise, move to finance or sales, vie for the CFO, Head of Sales or Head of a Division. Recognize the top slots go overwhelmingly to Americans with Ivy degrees, sales competence or finance backgrounds...not to geeks.
3. Go for the gold.
Don't spit venom like this. Out of the six arrested, two were of Indian origin, the rest were American origin. Greed is everywhere, whether it is Indian or US, greed has spread it's wings to the nook and corner of the world. So please don't be a cry baby, greed does not belong to any nationality, but it's simply human. We need to have better regulatory and transparent security systems which can monitor such frauds.
regards
Sekhar
http://www.nytimes.com/2009/08/10/nyregion/10bhara...
Wake up folks - I understand that our countrymen from India have committed frauds to enter US and to steal jobs fraudulently - they represent a small part. More than 95% of us are hard working genuine people and only wish good things to happen to US or any other part of the world.
I'm tempted to weigh in given that I spend three weeks a year in India, have staff there building my products, etc. But it strikes me that this post is no place to discuss India Inc. Jason, sign me up for some other forum if you're interested to discuss this particular topic.
Headhunter firms bribe hr managers in order to sell the most cheap personal they can find. Quality workers are forced to accept low wages or even doesn't considered. In the past I loved to work with IBM, HP, Sun, Oracle and other huge global players because of the extreme high standards. Recently I had to explain a support guy how to open and edit a config file on unix...
You're on. I've already deleted a few of the nastier comments here, but I've left some of the others so that people can see how close-minded and nasty people can be. Why don't we plan for a more moderated forum on the discussion (which I'll kick off) where all views will be welcomed, but without the fiery racism and rhetoric we've seen in this thread. I'm all for giving a voice to different perspectives, but when it descends into this type of language and opinion, there's no point in even having a serious debate.
I decided not to sit still on the issue for long. Here are my thoughts:
Outsourcing and India -- Civilized Debate vs. Name Calling and Racism
http://www.spendmatters.com/index.cfm/2009/10/19/O...
Its not even worth refuting some of mind-boggling allegations here (But in all fairness - "Indian bankers are responsible for the financial crisis" takes the cake and the bakery with it!) so I shall leave it to the more discerning reader to sift fact from malicious lies.
As for those who lost their jobs - I guess there isn't much to analyze : Globalization is a 2 way street.
http://hbswk.hbs.edu/item/6283.html
http://www.hbs.edu/research/pdf/10-018.pdf
I must admit I did not t know that the Native Americans stood so staunchly on the side of the Indian-Americans.
Surely, that was the intent of the poster, right? Because as we all know, they are the "best and brightest"
I can't believe I have to post this, but here goes.
American Indian (obs.) = Native American (current) = "Red Indian" (Education system of India)
Yes, they teach them about the "Red Indians" that Columbus discovered.
Indian-American = Person from India living in America.
American Indian <> Indian-American
You want an easy mnemonic, it has to do with dots, and feathers. I'm happy to share.
P.S. there is already a visa for the "best and brightest" with NO CAPS.
The O-1 visa (for Aliens of Extraordinary Ability) is for those who can demonstrate sustained acclaim or recognition for achievements in science, education, business, etc.
It requires PROOF of the individual's extraordinary ability, but it only has to be 3 or more of the following:
o Evidence of high salary in relation to others in the field
o Authorship of scholarly books or articles
o Being cited in professional publications
o Participation on a panel or individually, as the judge of the work of others
o Membership in academic associations which require outstanding achievements
o Original scientific or scholarly research contributions
o Receipt of major prizes or awards
o Evidence of previous employment in an essential capacity for organizations having a distinguished reputation
Read about it:
http://www.oiss.yale.edu/visa/o1.htm
So, what's the problem with squashing the H-1B?!
As to the rest which are on the line, I think it's important for everyone to see how racially motivated people can be. I'm personally dead set against any form of affirmative action, mind you, but I'm shocked at the level of hate here. Maybe I should rethink my policy stance. Oh, I forgot. In Chicago, Asians (including Indians) are held to a standard that exceeds that of whites (and far exceeds that of blacks and Hispanics) for competitive public high school admission. Shouldn't Indians -- and Indian Americans -- be afforded the same opportunity for their kids to go to the best schools as others? Ooops ... I forgot, they're not a protected minority, they're just a minority.
See the difference? Until we tackle this issue from a color and geographically blind perspective, there's no point in having it (and don't tell me for a minute our society singles out Indians for special hiring and admissions treatment like blacks and Hispanics -- we don't and in fact we often discriminate against them on the academic front). The short of my argument here is that those on the anti H1B side will continue to damage their arguments (not that I agree with them, but I do believe in constructive debate, and I hope they can get there) by making this such a hate filled discussion. Drop the racial overtones and show me from a new jobs perspective, from a lost jobs perspective, from a tax base perspective, etc. what your logic is.
Personally, I think we can thank much of the economic success stories in CA and the rest of the country in the past 20 years from Indians who decided to set up shop here. I wonder how many jobs they've created ... but of course, that's just my perspective.
That's it from me on this thread (and everyone else because I've closed out the comments on this post). If anyone from the anti H1B perspective wants to make a non-emotional business case for their argument and it's logical and well-reasoned, I'm open to printing it. Drop me a line.