By guest author Tony Scott
Introduction and Background to GlobalLogic
I recently had a conversation with Peter Harrison, the CEO of GlobalLogic. GlobalLogic provides research and development (R&D) services for software products through their team of over 3,000 software engineers based in the U.S., India, China, Ukraine, and Argentina. Their value proposition is to work as a collaborative partner with their clients on both context and core product engineering through a range of R&D services, including advisory, customer research, ideation, product engineering, QA/IVT, support and maintenance, and product line management. The company has ongoing partnerships with more than 150 clients in markets such as digital media, electronics, finance, healthcare, infrastructure, retail, and telecom. GlobalLogic’s investors include New Enterprise Associates, Sequoia Capital, Goldman Sachs, and Draper Atlantic/New Atlantic Ventures.
My discussion with Peter touched on how the technology and outsourcing industries are changing; his perspectives on perceived wage inflation in emerging economies; and his insights on the challenges of building a global organization with a consistent culture that encourages innovation.
Tony Scott: Peter, as I’m sure you are aware, most people think of a giant bank of phone operators sitting somewhere in the world answering incoming technical support calls, or providing basic, low-level IT services when they think about outsourcing. What I’ve been doing over the last few months is talking to people who are leading companies that are on the cutting edge of what would be considered higher-value outsourcing.
What I’m trying to find out is how companies like GlobalLogic are actually competing in the marketplace, how they work with customers, and the models that they see going forward in the world of high-value outsourcing.
To begin, can you tell me a bit about GlobalLogic: How did it get started, and how did you come to join it? I understand you’ve been here since 2002, and there were only twenty people in the company when you joined.
Peter Harrison: Yes.
Tony: That must have been a pretty big leap of faith!
Peter: [Laughter.] Yes. I guess it was. I helped start two companies prior to GlobalLogic. Both of them ended up globalizing their research and development, but they did so within the IT services ranks, the first in Russia in the early 1990s, and the second in India in the late 1990s. Both companies were very successful in their own right. Both went on to public offerings and enjoyed success, but we struggled. We sort of fell in love with the economics of globalizing R&D, but we struggled with the practicalities of it, and we struggled with the cultural conflict. It wasn’t so much the Russia–India–U.S. cultural conflict as much as it was, in my view, the R&D vs. IT conflict.
We had our own internal R&D organization, and we were trying to dovetail it with an external IT services firm, and it was just a fundamental mismatch between the IT mindset and the R&D mindset. Everything from the people they had, to the kind of processes they use, to the notions of specifications and continuous builds and automation, there were so many differences.
I took 2001 off, and I got to thinking about the future of the technology industry and more specifically the future of R&D, and I was convinced beyond a shadow of the doubt that it was a global service business. But I was also convinced that IT services firms were doing a poor job of addressing the opportunity, and that a someone should really address the problem of providing R&D services from the ground up. I thought that if we treated R&D differently from the way people were going about providing globalized IT services, we could do a much better job of it.
So, while I’m not a technical founder of GlobalLogic, I’m practically a founder. I joined the company when it was twenty people, as you said. At that time they were trying to do something different; they were pursing a new course, and I joined them to help put them on the course of pursuing R&D as a service, and working with technology companies, but only with the R&D organizations within those technology companies.