Consulting Its All About Expectations : Consultant - Client Relationship


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Consultants increasingly tend to describe assignment outcomes - bad or good - in terms of Client expectations. Whether it is “failing to manage expectations” or “managing to exceed expectations”, it’s all about expectations! Since Client expectations have emerged as a core concern, it seems pertinent to view the consulting business from this perspective. This note attempts to provide a framework for the business of consulting from the angle of Client’s expectations. For more writings, visit my website - .

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Consulting Its All About Expectations : Consultant - Client Relationship

  1. 1. CONSULTING: It’s All About Expectations! By Tushar Khosla Consultants increasingly tend to describe assignment outcomes - bad or good - in terms of Client expectations. Whether it is “failing to manage expectations” or “managing to exceed expectations”, it’s all about expectations! Since Client expectations have emerged as a core concern, it seems pertinent to view the consulting business from this perspective. This note attempts to provide a framework for the business of consulting from the angle of Client’s expectations. 1.1. Consulting from the Expectations Perspective From the Client expectations perspective, the consulting business can be viewed in the form of a three phase model that can be called the 3-D model; Discovery phase wherein Clients expectations are unearthed, Definition phase wherein shape, form and boundaries are given to these expectations, and Delivery Phase wherein activities are undertaken to meet the defined expectations. These phases are predominantly sequential, although small midcourse alterations may be permitted, if both Client and consultant agree. While this 3- D sequence would usually be a standalone cycle (Figure 1.1), it may sometime take a spiral shape (Figure 1.2), given the Consultants ability to discover new expectations at the time of meeting delivering those that were originally agreed upon. D2: DEFINE CLIENT EXPECTATIONS D1: DISCOVER D3: DELIVER Figure 1.1: 3-D Expectations Model for Consulting Business Each of the above phases will now be examined in some detail and strategies and techniques will be proposed that could help consultants handle these phases better. © Tushar Khosla, 2004 1
  2. 2. D2 D1 Cycle-2 D3 Figure 1.2: The Spiral Route of D2 D3 Cycle-1 D1 Expectations 1.2. Phase 1: Discovering the Clients’ Expectations Consulting opportunities arise due to the Clients’ desire to undertake change within its organization and its realization that it requires external help to do this. There are several reasons that could make management realize the need for change, including extrinsic reasons such as alterations in competition, market, regulations and technology, and intrinsic reasons such as changing stakeholder and management expectations, and redefined vision and role of the company. However, the desire for change needs to be supported by the motivation to undertake the change. Sometimes this motivation may not be very high, either due to insufficient dissatisfaction with the present state, or due to the lack of a clear vision of the redefined changed state. Other barriers such as a lack of perceived alternatives, limited financial resources, past experiences of failed change initiatives or the absence of a sponsor for the change may also delay action. Assessing the strength of business logic for change and motivation levels of Client are parameters while prospecting Clients for consulting opportunities. Figure 1.3 classifies the Clients’ state of readiness into four quadrants, and also indicates the action to be taken by Consultants in each case. © Tushar Khosla, 2004 2
  3. 3. H B Bring D Candidate for Perspective D2-Hot Pursuit Motivation 0 to undertake A C Overcome change Why Motivational bother? Barriers L L Need for Change H Figure 1.3: Prospecting Clients on their readiness for change The first step is to undertake pre-proposal investigations to establish the Client’s position with respect to the four Quadrants. This investigation needs to be undertaken objectively, and its findings confirmed through different sources, including cues received during initial interactions with the Client. The fact that the Client has invited tenders does not mean that the case is in Quadrant D; it may be in Quadrant B instead. The Client’s assignment coordinator could often project Quadrant D instead of Quadrant B, leaving the real status to be discovered once Consultants recognize missing or conflicting signals from elsewhere in the company. Clearly, soliciting business from Clients in Quadrant A is not a priority while Clients in Quadrant D are worthy of hot pursuit by the Consultants. Clients in Quadrants B and C need careful consideration. Regarding Clients in Quadrant C, the need for change is well established in their business logic; Consultants need to identify the barriers to action, and direct their efforts accordingly. Proactive efforts by the Consultants in such cases are likely to increase the Clients’ motivational level and move them into Quadrant D. For example, several companies appreciate the need to use information technology to improve company operations but do not know how to go about it. Such companies need technical support to encourage them to take decision towards implementing IT solutions. This explains the readiness of consulting firms’ to undertake technological planning studies at insignificant considerations. Similarly Companies that involve consultants in strategic planning look for some risk sharing by the consultants in ensuring successful implementation. Further, Consulting firms show creativity in structuring fees to overcome the Clients’ financial barriers. In the case of Clients in Quadrant B, the Consultants preliminary investigations would reveal that the Client’s motivation is out of proportion to the actual need for change. Should one go ahead and milk the opportunity? Such cases pose an ethical challenge. Before we can decide on an appropriate approach to such situations, let us see why and when they occur. Often it is a case of the Clients developing a liking for a well-packaged solution (with a plethora of impressive-sounding acronyms!) irrespective of the intensity of their problem or the relevance of the solution to their context. The Client’s thought process tends to be, © Tushar Khosla, 2004 3
  4. 4. “Our competitors have done it, my earlier company has done it, and they are performing so well (perceiving questionable cause-effect relationship); besides budget sanction can also be arranged”. This motivates the Client even if other more pressing problems await solutions. Alternatively, it may be that Consultants during the execution and delivery of an existing assignment have either invented or discovered a feeble expectation and blown its requirement out of proportion, thereby leveraging their credibility and proximity to the Client to book the next assignment. Other reasons could be the genuine enthusiasm of a new incumbent to contribute towards the organization. Frequently, the proposed solution is too sophisticated and evolved for the organization in question. Even if the systems are put in place, the expected benefits may not accrue, as business does not demand it or existing work practices do not support it. We see several cases of sophisticated management information systems that are in place but which are not in use since the effort required to maintain the plethora of updated data on the system is not justified in terms of business advantage. A scaled down version of the solution would have been much more appropriate to the Clients’ needs. In these cases, the Consultant has moved out with the payments and the satisfaction of having provided a state-of-art system, but nothing has changed at the Client’s end. Instead the foolhardiness of the champion of the initiative has becomes an integral part of company folklore. Worst, this goes into organizational learning, scuttling several other deserving initiatives and also closing doors for the consultants for a long time. When encountering such situation (Quadrant B), the Consultant needs to engage the Client in a dialogue on the problem that needs to be solved (purposely avoiding discussion on the solution itself), and establish the cost benefit balance of solving this problem. This discussion shall establish the urgency and priority of addressing this issue among other issues. As way forward, it may be possible to suggest the Client to take it later issues under different context (reconfigured scope) or undertake modular approach (step by step). There are too many risks in undertaking the assignment in its present form, because the Client may gain perspective in between, the motivated sponsor may get transferred, the solution may not deliver and the professional integrity of Consultant may be called to question. Although taking inputs from Consultants is now an established norm and does not raise any ego or ethical issues, some organizations may still resist this. The reasons could be a perceived loss of image (that of expert and pioneer), belief that their operations are too unique for outsiders to add value to, security aspects or a bitter past experience with Consultants. The Consultants will need to use their discretion to decide whether to pursue the case or to revisit in a more favorable environment. Having convinced oneself about the discovered expectations, it is time for the Consultant to move to Phase 2, that is towards defining the assignment specifics. 1.3. Phase 2: Defining the Clients’ expectations © Tushar Khosla, 2004 4
  5. 5. This phase sets the contours of the assignment and correlates the discovered expectations of the Client to specific requirements. These requirements would entail specific inputs from the Consultants and Clients, to be made under a suitable institutional framework and guided by assignment specifics. Figure 1.4 defines the three components of Phase 2 i.e. defining expectations. Institutional Framework Role of Consultant For Delivery D2 DEFINITION PHASE Assignment Specifics Technical, Financial & Contractual Figure 1.4: Three components of Defining Expectations Defining Role of the Consultant: Can there be any confusion about this? The answer is yes, especially when the Client expects the Consultant to play the specialist (Doctor/ Adjudicator) role while the Consultant believes his role to be that of a facilitator (coach and guide). If there is a difference in perspective on the role of the Consultant, the Client may look towards the Consultant for specific pronouncements and prescriptive directions (adjudicating internal conflicts, and equitable distribution of favors), while the Consultant re-emphasizes the need for a consultative process of problem solving and provides set of options leaving the choice to the Client. Its clear that, even if playing a facilitators role, Consultants should carry out their own analysis, and present alternatives with their merits and limitations. It is important for Consultants to be clear in their own minds regarding their predominant role, whether that of technical specialists or process facilitators, and to get a clear agreement from the Client on this issue. The choice of the role should be defined as per the context and the problem definition and not by the Consultants preferred style or as per the Clients’ convenience. Sometimes, the role definition may need to be re-emphasized by clearly stating specific inputs that are not to be expected from the Consultant. Defining the Consultants role up-front clearly dictates the terms of the agreement and the deliverables, and acts as reference to address any gaps in interpreting the specific responsibilities of the Client and Consultants during the execution of the assignment. © Tushar Khosla, 2004 5
  6. 6. Defining Institutional Framework for Execution Its equally important for the Consultant, that the Client establishes an appropriate institutional framework for executing the Consulting assignment. This involves deciding who should lead the effort from the Client side and what the monitoring and coordination mechanism should be. Further, it is important to ensure that all affected and influencing parties (other suppliers, subcontractors) are represented in the proposed framework with well-established responsibilities and a suitable coordination mechanism. In case the outcome expected out of assignment is perceived as an unpleasant one (downsizing, privatization, closure), or is likely to affect the whole or large part of the organization, the initiative should be either led by a High Level Committee or by the Head of the organization. Second rung leaders, no matter how competent, tend to have limitations, originating out of a lack of legitimate authority to comment upon or decide for the whole organization. Defining Assignment Specifics: Assignment specifics can be categorized in terms of technical, financial and contractual aspects. This note considers only the technical aspects since the other two are important enough to have well supported company policies, guidelines and a fair amount of standardization. Technical aspects involve the following: i. Defining Terms of Reference ii. Defining Deliverables iii. Defining Schedule Defining Terms of Reference To start with, Consultants need to break the myth of considering “Terms of Reference (ToR)” as the expected output of the assignment. The stated objective of the ToR is to capture Client’s expectations from the assignment and it is commonly considered to be the scope and criteria against which the completeness of the consulting assignment will be judged. While it is true that ToRs are prepared with some idea about the problem at hand and some information about the type of outside expertise available to help solve the problem, they are at most the Clients statement of intention, developed initially to get budget approved for the assignment and to invite tenders. This gets revealed in the manner in which ToRs are written and the ever increasing number of items into it. Some ToRs actually looks like components of methodology, and if defined in such a manner severely constrains Consultants in making adjustments to methodology if investigations so demand. It is in the Consultants interest to define the ToR to correctly reflect the Clients expectations. The best way to do this is to meet the organization representative at the highest relevant level and discuss the context without reference to ToR. Ask for two or three specific issues that are major problem areas and which the Client wants Consultants to work upon. Define the main areas of concern and compare with the ToR (if it has been handed over to you) to ensure that it encompasses those issues. If it does not, bring it to the Clients’ notice. This way the Client will be able to set well defined priorities. Unless this is done, the Consultants’ tendency is to either spread effort equally across all components of ToR or to set priorities that are more influenced by their own interests and abilities. © Tushar Khosla, 2004 6
  7. 7. In certain cases the way ToRs are written leaves much open to interpretation, especially in terms of Specificity of Recommendations. What is the level at which the recommendations are to be made: Organization, division, group, project, individual? For a Consulting assignment related to corporate strategy, where should the recommendations stop: by identifying the need for diversification, possible areas of diversification, strategy for diversification, possible JV partners, equity break-ups; the list can go on and on. For an IT strategy, it may mean examining need for ERP, identifying modules, functionalities, appropriate ERP, suitable Vendor, cost or a subset of these. To best address this issue, convert the ToR components into a set of questions and get the Clients’ agreement on the scope and exhaustiveness of the list. Spell out the necessary details to ensure that no doubts persist about the expected specificity of recommendations. The Client may add more questions or delete a few as a matter of detail not required as a part of the assignment, but once agreed upon, this list becomes a key reference list for the rest of the assignment. This becomes the common evaluation criteria to judge the output of the assignment. If not done at pre-proposal stage, perform this exercise within the first month of the assignment and include the outcome in the inception report. Among the several unstated expectations, which need clarification, is the Consultants responsibility towards skill transfer (capacity building) and system support. It is in the interest of the Consultants that the Client system develops sufficient in-house capacity and capabilities to carry on, once the Consultants withdraw. However, this effort has its costs and has to be planned and negotiated upfront. If the ToR does not cover this issue, it is important to get this stated explicitly. Defining Deliverables Sometimes a large number of deliverables reflect either the Client’s need for control at every step or a belief that the high cost of Consulting can only be justified by a large number of deliverables. The financial reason could be the Clients’ desire to spread the payments across several milestones. It is important to discuss the technical objective of each deliverable with the Client. The purpose of each deliverable is to provide an opportunity for the Client organization to take cognizance of the progress of the assignment and intermediate outcomes and this involves committing resources and management time on the behalf of the Client. Sometimes however, the number of deliverables are so large and their submission so frequent that it may not be possible for the Client to devote adequate attention and time compromising the objectives of the intermediate deliverables. Its seen that the top management’s time is always a big constraint and seeking it too often for intermediate deliverables becomes a constraint for the assignment coordinator. However, each deliverable adds to the documentation and accounting effort on both sides. It is best to critically analyze the purpose of each deliverable, its scope and its form (report or presentation) with the Client at the initial stage and remove any that are unnecessary. An option could be provided to allow the Client to add deliverables during course of assignment if both parties feel the requirement. Further, not every deliverable need necessarily involve associated financial commitment. © Tushar Khosla, 2004 7
  8. 8. Defining Schedule It is a rare Client whose estimate of the time required for the assignment is not at least 40% less than the Consultants’ estimate. One reason could be the difference in understanding the ToR and the specificity of the recommendations. This problem should be resolved by this stage. If the difference in estimates still persists, it may be reflection of financial implication of project duration, which works differently for Client and Consultant. The fact that financial bids are based on man-month efforts (in turn related to assignment duration) and the rates, it is in the interest of the Client to underestimate man-months and for Consultants to overestimate. This becomes clear, once the assignment has begun and the Consultant realizes that the Client is willing to award extensions and switch deadlines but with no price escalation. Despite several claims and promising formulas, I still believe that a lot of intuition and experience is involved time estimation. Whenever the time estimates are significantly different, one may consider negotiating price and effort separately from the assignment duration. There are limits to how much a schedule can be squeezed, no matter how many resources are put on the job. The more the dependencies outside the Consultants realm of control, the more is the buffer required. Sometimes, including intermediate periods of non-activity for the Consultants while Client develop it response may help to contain cost within the defined overall duration. These periods of inactivity need not be predefined in the schedule but total period may be indicated. 1.4. Phase 3: Delivering on Clients’ Expectations Undertaking Investigation Developing Recommendation Relationship Management Project Management Initiation Delivery Phase Closure Figure 1.5: Components of Delivery Phase The delivery phase starts with the signing of the contract and ends with the receipt of final payment from the Client. Figure 1.5 depicts the different components of the delivery phase. Project management and relationship management components run throughout the delivery phase. Consulting firms mostly view assignments as projects and to that extent have developed fairly standard and sophisticated tools to track resources, costs and deliverables. Hence project management component of delivery phase is not discussed here. However, there are peculiarities in other components that need emphasis and these are briefly discussed below. Relationship Management: The Client-Consultant relationship is a lateral relationship based on equality and partnership with each one playing its pre-defined role. It needs © Tushar Khosla, 2004 8
  9. 9. special attention to ensure that the relationship does not degenerate into a boss- subordinate relationship. Several Clients are accustomed to a command and control setup and are uncomfortable in this kind of relationship, hence the onus of managing this relationship throughout the assignment is on the Consultant. Consultants have to demonstrate sincerity, trust and professional competence in early interactions with Clients in order to win their confidence and to be treated as partners in the relationship as differentiated from the other contractors, suppliers, outsourcing parties or external auditors. Once the relationship is established, Consultant must possess sufficient discipline and self control to avoid leveraging the Clients’ dependence to arrogate the power of the Client. Consultants need to have authority with Clients and not over or under them. My crude test of knowing that right relationship is in place is when either of us (Client or Consultant) is equally comfortable in shifting appointments, if we are not 100% prepared for the task defined for the meeting. A further sign of a healthy relationship is that the Consultants do not obediently (almost automatically) accept every demand made, nor do they expect Client to behave in that manner. While preparing minutes of the meeting after every interaction, Consultants may give some thought to the behavioral and emotive aspects of the interaction in order to pick up any early signals of shift in balance. Undertaking Investigations: The nature of assignment, the role of consultant and methodology should dictate the extent of investigation to be undertaken. Nevertheless, Consultants sometimes over invest in investigations with diminishing returns. As Consultants, one can never know the organization as well as its internal staff. Consultants need to focus on bringing the technical expertise to the problem domain, developing hypotheses, and testing them. The Client and his internal staff would point out any gaps in understanding specific aspects of the company. This is why it is important to get the Client to formally accept (sign-off) the basis (e.g. currency and validity of data) of the investigation and analysis before sharing the outcome of the analysis. Given this, why do Consultants still over invest time in internal organization analysis? The reasons for this are as interesting as they are revealing. Sometimes detailed data collection is carried out to increase Client confidence that the solution is appropriate (or suitably customized) for their organizational needs, and has taken care of the uniqueness of their organization; many Clients seem to be overly sensitive about this. In many cases, the volume of material collected can act as surrogate measure to demonstrate efforts made, thicken reports and justify high fees. Meetings are not only carried out to get data, impressions and views, but also to ensure that all important persons and stakeholders are kept in good humor and given chance to contribute. These actions can be justified as a response to the political realities of organizations but they should not be over-stretched as they come at a cost. However, sometimes Consultants tend to stretch the data-gathering phase to buy time to hunt for an elusive solution. There are limits to how far analysis can take Consultants (in most cases no further than it takes the Client) and it is creativity and experience that fills the chasm between analysis and recommendations. But whenever analysis paralysis syndrome occurs, Consultant should realize the intellectual road block one is facing, take help from resource consultants (other experts in your firm) and determine whether the problem is insolvable by design or whether the Consulting team © Tushar Khosla, 2004 9
  10. 10. lacks the adequate skills, experience, and creativity to solve the problem. The follow-up action becomes evident (either mutually close the project, redefine scope or redefine team) but needs to be carried out with complete authenticity and at the earliest. Developing Recommendations: There are often several possible solutions to address the issue at hand and even if Clients agree with the Consultant regarding the nature and extent of problem, they may not accept the proposed solution. Developing recommendations require high contextual sensitivity on the part of Consultants, especially in three areas: i. Clients appetite for risk ii. Comfortableness with technology iii. Prevalent organizational practices Clients’ appetite for risk: In these days of reforms, we recently suggested a restructuring option to a government organization, that would have yielded significant gains to all stakeholders. The plan was well backed by rational and logical arguments undertaken for an extended period at all levels within the organization. The proposal was presented to the seniormost government officials, and they seemed to be convinced about its merit, until one of them asked, “Has anyone implemented this, anywhere?” and when they did not get an unambiguous, “Yes”, their enthusiasm about the proposal fizzled out. They were simply not ready to experiment; for them the risk associated with working without any precedent was too much to take. Similar risk aversion is frequently observed in private sector companies, especially companies doing well. The consequence of failure being more severe (fatal), the private sector may risk change when continuing with the present indicates impeding danger. However, they also seek assurance from precedents even if they are from sectors outside their direct operating field (airlines learning from hotel industry). This aversion to risk taking and charting new territory is why Best Practices have become so popular. As a Consultant, it is important to gauge in early interactions, the Clients’ appetite for risk and fresh thinking, otherwise a radical solution at the end may not be acceptable to the Client. The Clients’ history of initiatives and its reputation in the industry gives some indication of its risk taking capacity, and this can be reconfirmed by making some bold proposals to the Client during conversations in early stages. Clients’ comfortableness with technology: Information technology may help a company improve documentation and communication, enhance its internal process efficiencies or provide a strategic competitive advantage. Different companies are at different stages of technological adoption and the reasons may be sector or company specific. Proposing solutions to over-enthusiastic management teams (with resources to commit), which are beyond the company’s absorption capacity may be folly in the long term. Consultants have to point out the prerequisites for successful technological absorption, including the resource and management commitments and the associated risks, and be suitably convinced about the business justification of proposed solution before recommending it to the Client. © Tushar Khosla, 2004 10
  11. 11. Prevalent Organizational Practices: Each organization has its own set of practices; the way the things are actually done in that organization. Practices are the outcome of organizational history, evolutionary process, and owners’ preferences. They represent a negotiated balance between conflicting interests and power lobbies in the organization. Sometimes when the recommendations are pronounced as impractical, one of the reasons is that they challenge prevalent practices. It could be that Client does not want to upset the existing arrangements, as it might create problems larger than the one it aims to solve. Consultants must keep in mind the interconnectivity and interdependencies of various organizational elements. Do challenge the assumptions but with sense of empathy about what exists. Embedded practices take time to change. Consultants may actually benefit by considering the nature, reason and strength of prevalent practices (besides official policies and procedures) while defining “variables” and “constraints” for generating solutions. Recommendations need to account for changes in practices, through transition plans that allow additional resources, flexibility in scheduling and relaxation in short term performance measures. Several times operational managers are not against the recommendations but the implementation mechanism and schedule. Consultants need for contextual sensitivity require adopting process orientation during assignment. Hence the emphasis in literature on paying equal attention to the process of evolution of recommendations as to the content of recommendations. Several standard techniques of engaging Client in joint problem solving are known, and may be suitably chosen. Recommendations evolved through deliberate and collaborative process with sufficient contextual sensitivity have a high probability of being accepted. At the same time, once in while every Consultant comes across a Client that accepts anything. As Consultants, we need to be cautious getting caught in the trap of cutting corners for such Clients. Sometimes, the Client coordinator is new to the subject area of consulting and has a very low level of technical competence to judge the quality of the output created by Consultants; in such cases even substandard work can pass through. Alternatively, the Client may not have faith or interest in the consulting assignment but gone ahead under some compulsions. In either case, Consultants must stick to internal professional quality standards. There are other more demanding, competent and interested people in the Client’s organization, who may judge the output later in the day. In one case, where we were involved in providing a technological solution, the Client coordinator was not comfortable with information technology and would approve most of the deliverables without much difficulty. It was more difficult to get the deliverables passed by our in- house quality expert, than by the Client. The temptation to take advantage of the Clients ignorance and take shortcuts were severely restricted by the presence of this insufferable barrier called the internal quality review. But the merit of the system was hammered home when in the last phase of the assignment, the Project Coordinator from the Clients’ side was replaced by an expert in the field, especially brought in to guide the project to closure and handle the implementation phase. This instance makes it clear that the quality of consulting output should always be higher of the two: Consultants’ own professional quality standards and the Clients’ expectations. © Tushar Khosla, 2004 11
  12. 12. More importantly, the work done by Consultants is a permanent reflection of their abilities and is their best marketing product. Nobody remembers the reasons and situational constraints under which the work was carried out, but the solution will be judged for its quality forever. This danger is omnipresent whenever Consultants take up large tasks on shoestring budgets, under stiff competitive pressures. The fact that the project is resource starved is not enough reason to justify gaps in quality. People who judge consulting reports do not bother to note the cost, man-month efforts or situational constraints under which the work was carried out but expect the best possible quality output. Hence cutting corners, and compromising on quality is dangerous. Consultants are as good as their worst deliverable. 1.5. Conclusion This note defines the consulting business from the perspective of Clients’ expectations. There are peculiar challenges faced by Consultants during the discovery, definition and delivery phases of assignments. And any challenges inadequately handled in any phase have a dysfunctional impact in later phases. Therefore, these unique challenges need to be recognized and tackled. Some of these aspects tend to be overlooked, if consulting assignments are managed using the project management paradigm alone. The note identifies some of the many emergent challenges and possible strategies. Actual challenges that emerge would depend on scope of consulting (organisational or functional), type of Client (private sector or government bodies), operating context (developing or developed economies) and prior experiences of Client and the consultants involved. Whatever be the case, Consultants need to be equipped to handle both the expected and the unexpected challenges on the assignment trip. After all, Business of Consulting is all about expectations! About the author: Tushar Khosla is a management specialist working in the areas of strategic and organizational consulting. He is with Tata Consultancy Services and presently based at New Delhi. He has consulted for Government Institutions, Multilateral funding agencies, Public and Private sector companies, mainly in the infrastructure sector. Presently, he is involved with the Modernising Government Program of Government of Kerala, India. He can be reached at or The views expressed are personal. For discussions and feedback, please write to, or © Tushar Khosla, 2004 12