<img class="gwt-Image" src="/photo/46838659.cms" /><keyword id="150034" type="PERSON" weightage="80" keywordseo="Vijay-Govindarajan">Vijay Govindarajan</keyword>, voted one of the greatest 'Thinkers' of the world by Thinkers 50 and the Earl C. Daum 1924 <keyword id="1816524" type="POSITION" weightage="80" keywordseo="Professor-of-International-Business">Professor of International Business</keyword> at the <keyword id="298560" type="ORGANIZATION" weightage="80" keywordseo="Tuck-School-of-Business">Tuck School of Business</keyword> at <keyword id="224383" type="ORGANIZATION" weightage="80" keywordseo="Dartmouth-College">Dartmouth College</keyword>, talks about about the problems plaguing <keyword id="6375224" type="ORGANIZATION" weightage="80" keywordseo="higher-education">higher education</keyword> in India and the US and also the benefits of 'reverse innovation', a term he formulated through his bestselling book with the same title, in this freewheeling chat with Dr <keyword id="209438" type="PERSON" weightage="80" keywordseo="Amit-Kapoor">Amit Kapoor</keyword>, <keyword id="6364480" type="POSITION" weightage="80" keywordseo="Chairman">Chairman</keyword> of the <keyword id="2798602" type="UNKNOWN" weightage="80" keywordseo="Indian-Council-of-Competitiveness">Indian Council of Competitiveness</keyword>. 
 
Could you give a brief insight of your academic journey and your notion of reverse innovation? 
 
Having grown up in India, I know that innovation is the solution for many of the country’s problems. India has too many problems and we have too few resources and the only way to solve these problems is innovation. I committed myself to really studying innovation and I have always been interested in its impact on the real world, but by doing really regular research. When I came to America my study was really targeted at American companies and how they innovate. In the last 10 years or so I got interested in the notion of reverse innovation which is about innovating in a poor country like India and so that brought me full circle with regards to my ambition. 
 
When you said you have come full circle moving from India; working with American companies; and now looking at India, what is the biggest learning that you drew from this country? 
 
I think there are three learnings that I got from India. Firstly, the notion of frugal thinking that comes very naturally to us. Because the resources are limited and we want to be very efficient in how we spend our resources and not waste them. Secondly, we Indians emphasize a lot on memorizing data which is not so in the US. It is dying even faster because of the advent of computers, calculators and iPhones. US focuses on critical thinking, whereas in India we do not focus on critical thinking. As I was brought up in India and was exposed to memorizing data, then when I came to US and got the critical thinking part, it was a deadly combination as I had the data plus critical thinking orientation. critical thinking without data is useless and data without critical thinking is also useless. So, the second important notion from India is data. The third thing is diversity. India is such a diverse country and if anyone has operated inside India, then he is well prepared to face the outside world. 
 
There is a misnomer amongst people who relate frugal innovation to Jugaad. How would you react to this? 
 
To me jugaad is absolutely the wrong way to go. Jugaad is different from frugal thinking. Frugality can co-exist with the latest technology. Jugaad is “The way people use it, improvise it, make it work and get the things done”. I think jugaad implies even inferior quality. That’s not what we need. What we need is latest technology in innovation, which is at the cutting edge. For example, <keyword id="749500" type="ORGANIZATION" weightage="80" keywordseo="Narayana-Hrudayalaya-Hospital">Narayana Hrudayalaya hospital</keyword> is an excellent hospital as they have the latest equipment in cardiac surgery as you would find in the US. Yet we are able to do cardiac surgeries for $2000 whereas in US it costs $150,000. Frugality is bringing that cost down to $2000 by using absolutely the greatest, latest and the most appropriate technology. What we really need is to marry technological powers in the US with frugality. 
 
You wrote a very interesting piece in <keyword id="53675" type="ORGANIZATION" weightage="80" keywordseo="harvard">Harvard</keyword> Business Review wherein you talked about a $300 home. How can 
reverse innovation help us do that? 
 
When I wrote the article about $300 home it was not about lowering cost but was about offering more value at a lower cost. I was challenging people to think about how more health, education, jobs can be offered in a $300 house. Take for instance health – health is not just delivered in hospitals, health is also delivered in a way you construct a house. In today’s world there are three infectious diseases, which are killing millions of poor people all over the world - TB, cholera and malaria. TB is air borne disease and if we imagine a hut, which has no sunlight, no ventilation, and ten people sleeping then if one of them has TB the other nine would also be infected with it. So, why can’t we derive a $300 house with proper sunlight, ventilation and thereby decrease the incidents of TB. In a similar way cholera is water borne disease and we should look at designing a $300 house, which has portable drinking water. The last one is malaria, which is caused by mosquitos, so the house should be designed in such a way so that we can put up mosquito nets and decrease the incidents of malaria. The point is to think about the housing problem by using breakthrough thinking. we did a project in Dartmouth wherein the participants were called from all across the globe and were given the task of building a $300 house, which is earthquake/ hurricane resistant. By using local materials, the local people could actually construct the house thereby creating jobs for themselves. This is really about how do we include the poor people in the innovation that we create. 
 
What we are saying is at what level we are able to give in hands to quality of life. Yes, that’s really the point. Ultra low cost housing is not a new topic as people talked about it for decades but they talk about it as though it is a problem of charity. We somehow divided the world of 7 billion people into two compartments. 1 billion who are consumers who have the purchasing power and the rest 6 billion, the non-consumers, the so-called poor, who we have left to be taken care of by charity. The problem of converting the 6 billion non-consumers to consumers is not a question of charity but it is a challenge for innovation because the reason they are non-consumers is they can’t consume the products the 1 billion consumers are consuming. In Narayana Hrudayalaya (NH) the same platform is used for doing surgeries for the people who are paying and also for the poor patients who either pay nothing or pay subsidized rates. The concept of a $300 home or a $2000 cardiac surgery is not charity. Corporations should clamour for this model for its reach maximization and not for profit maximization. NH is also about reach maximization. The problems of education/ health/ transportation can be solved by making it available to the consumers and the non - consumers. So, having a $300 home is a problem for the corporations to solve and corporations would come in this space if they find significant opportunity in this field and are able to make money. Looking at 6 billion populations of non - consumers with an average of 6 people per household we would have an opportunity of $300 billion. Similar is the case with Apple where it is not able to sell its iPhone to 6 billion non- consumers, as they cannot afford it. If apple makes a $10 nano iPhone they would be looking at a $60 billion opportunity. So, on a digital platform in the $300 household one can deliver more education to the poor through eLearning, more health through tele medicine, more banking through mobile banking etc. All the above requires thinking and creativity and leads to doing more with less. 
 
How is your thinking emerging in the area of education as this is the foremost problem the world is facing? 
 
Let us think as to why education is so expensive in US. At Dartmouth the annual charges are $60,000 for tuition, boarding and lodging amounts to $200,000 – $250,000 for a 4-year course. Basically only the very rich can afford that kind of education or very poor because they get scholarship. The middle class people get squeezed because they make enough money so they are not entitled to scholarship, but they can’t afford $250,000 so they have to take a loan and hence pay for the rest of their lives. 
There are three reasons why education is expensive in the US. Firstly, good institutions follow the vertical integration strategy which means knowledge creation is done by the faculty who do research and the same faculty disseminates that knowledge to teach and the same faculty does the assessment to grade the students for which the institute issues the certification. So once you pass these courses you get the certificate. The cost rises with vertical integration. Secondly, at Dartmouth everything is done on campus. Therefore, the infrastructure costs rises as lab, dormitory, classes, faculty offices, cafeteria have to be built. Thirdly, colleges have an admission policy called principle of inclusion and principle of exclusion. In Dartmouth we take a lot pride in saying how many people we reject. About 95% of the people who apply are rejected. So, we have built an education industry in this country on these people who are snubbed. India has millions and millions of people who need education and we cannot follow the American model of education as that model is based on exclusion and not on inclusion. Higher education is very expensive in India so we have to disaggregate the value chain. We should not focus on the basic research in India instead let the American universities do the research. In this way we would be able to eliminate the expense on research. Secondly, we need to create a global university in India, which will have online courses in every subject. Delivering courses online is not only low cost but also high quality. In higher education there are two types of courses – transactional and transformational courses. Transactional courses are better delivered through online platform and transformational courses are face-to-face interaction because it’s about application/ problem solving. So, we could have the best teachers in India create the best course in every area in the transactional courses. The universities would only conduct the transformational experiences and then we would create a third global university, which would do the assessment. So the second university would take the assessment and third university would do the certification. In certification we need certified courses, which provide right kind of knowledge and capabilities to do the right kind of job. 
 
Do you think we can surmount the problem of critical thinking that India is lacking? 
 The transformational courses are the ones from where the critical thinking comes from. And that’s why we have to have the broken model university system as well and hence the transactional courses and transformational courses. The corporations also need to step in and <keyword id="47916" type="UNKNOWN" weightage="80" keywordseo="invest">invest</keyword> in human resources. My thinking is we have to fundamentally rethink the way we are attacking the education problem in India. This is a great innovation opportunity to create a new model of education. 
 
When it comes down to it, what is pushing India back and what really needs to be changed in this country to take it forward? 
 
When I look at India I look beyond the filth and poverty and at a huge human potential. The human potential in India is enormous and awesome. Then I look at our accomplishments which are very disappointing. Of late I have become even more frustrated with the lack of progress in India. So I look at what we have achieved and what we could achieve. The human potential is incredible, but we have fallen short. The problem is really the leadership gap. There is a real leadership deficit in India. If India has to realize its full potential we need to create systems and process and structures which will harness the talent. We really need someone to lead this talent. Youngsters need to step up and take the leadership forward. 
 
Everybody understands the way political leadership has failed the country. Are you saying that even corporate leaders have failed? 
 
My hope is corporate leadership. Since independence we have had problems in political leadership. There have been scandals, corruption charges and lack of economic progress even on the corporate side. We have had some success stories, especially in the 90’s when the IT companies came on board. We thought we were building a new India, but it looks like we are back to the same muck. Corruption and inefficiencies are cropping up, growth is slowing. We should have more experiments in the education industry like we have NH in health industry. Health alone could be a huge industry in India. Presently, they are touching only about 1% of India; 99% of India does not have proper health care. The health industry is one where we can employ a lot of people because it is a services industry. We can solve our employment problem and this is what I mean by, where is the corporate leadership? Similarly in infrastructure and transportation the gap is so big. Corporate leaders need to step up and make their employees a part of the wealth creation process. We certainly don’t seem to have that momentum to move forward. 
 
(This article was contributed to Thinkers, a quarterly thought leadership magazine that features the brightest thinkers in the areas of economics and governance, philosophy and literature, science and technology, and management. To learn more about the magazine, please visit: <a href="http://www.thinkers.in/">www.thinkers.in</a>)

Thinkers/Thinkers50: Creator of the term 'Reverse Innovation' says India's has great human potential, but there is a 'leadership deficit'

<ul class="summary-list"><li>Tech's pandemic bubble has finally burst, demonstrated by layoffs and falling share prices.</li><li>Every previous boom and bust in tech over the decades has resulted in winners and losers.</li></ul>There's been a lot of noise in the tech sector lately. Debates over "<a href="https://www.businessinsider.com/laid-off-meta-employee-says-paid-not-to-work-2023-3">fake work</a>," sweeping rounds of layoffs, and the rollback of lavish employee perks, have all raised a single unifying question: is the golden age of American tech over? Call it a downturn or call it a market correction. Whichever way you slice it, one thing is certain, the valuations of most major tech companies were high — and <a href="https://www.businessinsider.com/inflation-likely-recession-wipe-3-trillion-tech-giants-this-year-2022-10">now they're not</a>. Investors have spoken and the tech industry has hit a rough patch. After over a decade where the music never seemed to stop in Silicon Valley, the last song of the night is finally playing.The thing is that the tech industry has been here before, and will likely be here again. While companies like <a href="https://www.businessinsider.com/metas-job-cuts-are-about-mark-zuckerbergs-mistakes-2023-3">Meta</a> and <a href="https://www.businessinsider.com/google-layoffs-jobs-alphabet-work-employees-staff-sundar-pichai-2023-1">Google</a> have hit rough patches for sure, there's no reason not to believe that they'll bounce back. They may even be wiser for the experience, experts say."The fundamentals are strong, maybe this is a reminder that austerity is important," said Dr. Vijay Govindarajan, a professor at the Tuck School of Business at Dartmouth College.But while the rest of the world gawks at the current state of tech, experts say that there are lessons to be learned from looking at the winners and losers of the previous booms and busts. <h2>Every tech boom and bust has a lesson to teach</h2>The origins of modern-day Big Tech dates back to the 1960's, as computers slowly but surely transitioned from <a href="https://www.businessinsider.com/chart-of-the-day-us-tech-research-and-development-spending-2011-2">something primarily used by the government</a> and academic sectors and into something that would find their way into the workplace, and later, households. Companies like IBM, Intel, and Hewlett-Packard saw their fortunes rise, as Wall Street began to fall in love with tech stocks, American historian and University of Washington professor Margaret O'Mara told Insider.But when the US government started pulling its tech spending amid the economic recession of the 1970s, the floor fell out from under Silicon Valley. It took the personal computer revolution, which peaked in the 1980s to bring the tech sector back into investors' good graces. That boom lasted well through the advent of the Internet in the 1990s — right up until the notorious dot-com crash of 2000 when the market turned on buzzed-about web startups whose investment capital didn't match their earnings potential . The <a href="https://www.nasdaq.com/articles/the-nasdaq-composite-just-did-something-its-only-done-3-times-in-history" target="_blank" rel="noopener">Nasdaq fell 39%,</a> and a number of companies went under. Some of the remaining dot-com survivors that still exist today are Google, Amazon, eBay, Priceline (now Booking.com), and what's left of Yahoo. Tech historian Micheal Malone told Insider that the successful companies took an important lesson from this difficult period: One product wasn't going to keep them relevant nor afloat. Information technology was evolving too fast for any one idea, no matter how good, to carry a comapny through. Apple shook up its PC business with the introduction of the iPhone and the discontinued iPod. And Microsoft acquired internet companies that could help support the creation of its internet software business."You can't just have a hot product, get rich, and walk away. You had to create follow up products," said Malone.Others suggest the real lesson is the dangers of what can happen when investors get involved with technologies that aren't quite mature yet."If you jump into a disruptive technology, you can really lose a lot of money because nobody knows enough about it," said Dr. Vijay Govindarajan, a professor at the Tuck School of Business at Dartmouth College.<h2>Staying agile is a relevant lesson, and so is making sure the foundations are sound</h2>It took years for things to turn around, with the great recession of 2008 slowing down the recovery.When investors finally warmed back up to tech, Malone said the new theme became scalability: "You had to understand the markets, changing trends, and if you have those things, can you grow that company by 10 times every year?"Startups turned to users for help instead of taking on the expensive task of scaling by themselves. So-called Web 2.0 companies like Wikipedia, Facebook, Flickr (now part of SmugMug) and Twitter all relied on user-generated content, rather than creating it by themselves. "Facebook could not have created a billion webpages for people. They let people create them themselves. That's scalability," Malone told Insider.That theme carried companies into the earliest part of the 2020's. But something new is emerging now. While the rounds of layoffs and falling stock prices have been painful, Malone believes its bringing new focus to the lessons of being "financially sound" and having strong "structural underpinnings."For Dr. Govindarajan, the theme is austerity, telling Insider that tech "can't afford to be wasteful" anymore. Wall Street and tech are betting the next boom will come from <a href="https://www.businessinsider.com/chatgpt-will-be-overhyped-overlooked-and-then-perhaps-essential-2022-12">ChatGPT</a> or the <a href="https://www.businessinsider.com/what-is-the-metaverse-decentraland-axie-infinity-roblox-sandbox-facebook-2022-4">metaverse.</a> But in this environment, it'll be those who thought ahead and made sure to spend their money wisely. "Ten years from today, there will be players who would've made money. Some people would've lost," said Dr. Govindarajan. "And that's the nature of the tech industry."

A dive into tech's eternal boom-bust cycle shows how companies can succeed in tough times

<ul class="summary-list"><li>Layoffs have made it easier to poach star AI talent, according to the CEO of Intuit.</li><li>That's despite a rush fueled by the success of ChatGPT, DALL-E, Midjourney, and other AI tools.</li></ul>Employment instability at the major tech firms is making it easier to poach star talent even when they still have jobs, according to Sasan Goodarzi, chief executive of software giant Intuit.Intuit, whose software products include email-marketing service Mailchimp, tax-filing software TurboTax, and credit service CreditKarma, has been investing heavily in artificial intelligence since Goodarzi took the top job in 2019, <a href="https://www.businessinsider.com/intuit-ceo-sasan-goodarzi-ai-microsoft-ceo-2019-3?r=US&amp;IR=T">succeeding longtime CEO Brad Smith</a>.Asked if AI hiring was more competitive thanks to <a href="https://www.businessinsider.com/elevenlabs-a16z-among-us-funds-battling-invest-tiny-ai-startup-2023-3?r=US&amp;IR=T">the post-ChatGPT investment rush</a>, Goodarzi told Insider in a March interview: "It's actually become easier because of all the tech layoffs, because of the uncertainty the layoffs have caused. It's getting people to raise their heads who wouldn't."Looking back over the past six or seven months, it's been far easier to find that type of talent — data and AI have been core to our strategy," he added. "When we talk to engineers that understand AI, they see our investments, it's actually easier."Industry executives <a href="https://www.businessinsider.com/laying-off-staff-is-a-mistake-experts-say-2022-8?r=US&amp;IR=T">warned last year that mass layoffs</a> risked hurting the morale of workers who did keep their jobs and could put off potential talent from applying for roles in future. And tech employees currently worried about their "tenuous positions" are actively looking for more stable employment, two prominent business school professors, Dartmouth Tuck School's Vijay Govindarajan and the University of Calgary's Anup Srivastava, <a href="https://hbr.org/2022/11/tech-talent-is-flooding-the-job-market" target="_blank" rel="noopener">wrote in the Harvard Business Review</a> in November.Alphabet, Meta, Microsoft, and Amazon have conducted large-scale layoffs since the end of 2022, affecting around 70,000 workers collectively as <a href="https://www.businessinsider.com/4-charts-show-falling-revenue-per-employee-at-tech-firms-2023-3?r=US&amp;IR=T">they refocus on efficiency and profitability</a>. Goodarzi added that the uncertain environment is such that "it's just easier to recruit folks that still have jobs."Intuit remains unusual compared to its peers going into 2023 by one metric: No mass layoffs.The company had 17,300 employees, as of July last year, according to financial filings, up from 13,500 the prior year. A spokeswoman said the company has not conducted large-scale layoffs similar to other tech firms, and that the company had been "intentional" about how it had grown parts of its business.For its fiscal Q2, Intuit reported net income of $168 million, up year on year from $100 million, on revenues of $3 billion, up year on year from $2.7 billion.The spokeswoman declined to detail how many AI roles the company had hired over the past year, but said the firm uses the technology for millions of interactions with customers and to generate predictions. In <a href="https://www.businessinsider.com/intuit-ceo-sasan-goodarzi-ai-microsoft-ceo-2019-3?r=US&amp;IR=T">an earlier interview with Insider in 2019</a>, Goodarzi talked up AI and spoke about spending time shadowing Microsoft chief executive Satya Nadella, who spearheaded the firm's multibillion-dollar investment with ChatGPT-maker OpenAI."People laughed at the time, but I had shared that I believe, after electricity and the internet, AI would ignite global innovation in ways we could never imagine possible," Goodarzi told Insider during his recent interview.

Big Tech employees are so unnerved by mass layoffs that they're now easier to poach, according to the CEO of software giant Intuit

<ul class="summary-list"><li>The tech sector has already cut nearly 100,000 jobs this year.</li><li>Those who have identified with their big-name companies and high salaries are taking it hard.</li></ul>Layoffs at Big Tech companies have caused an identity crisis for many affected workers."If you've identified yourself with your salary, which a lot of people do, and if you identify yourself with working for a glamorous company like a Microsoft or Google or Meta, then your identity is taking a hit," Laurie Swanson, a career coach and a recruiter at InspiHER Tech, said.The root of it all lies in the notion of tech exceptionalism: As companies like Google, Facebook, and Salesforce grew into the giants they are today, they seemed to defy gravity — making money hand-over-fist, even as they pampered their employees with perks that seemed too good to be true, such as massages, Ping-Pong tables, and free food.Now, things are changing, and the world of posh perks and eye-popping salaries that zealous investors supported is <a href="https://www.businessinsider.com/impact-of-big-tech-layoffs-amazon-meta-microsoft-google-salesforce-2023-2#-3">reining itself in</a>. Companies have let go of around 100,000 employees already this year, more than half of what they shed in 2022, according to Layoffs.fyi, a website that tracks layoffs in the technology sector. Companies like Google, Meta, Microsoft, and Amazon shed over 50,000 jobs in total, with all companies claiming that they over-hired during the height of the pandemic.From a business-and-investors standpoint, this market correction is likely long overdue. But for tech workers who were sold on the glamorous lifestyle these companies have provided over the last few decades, this is a blow to their self-image. Tech looked like the solution to so many things that it produced a mindset among some employees that it was the exception to capitalism's rules."The feeling was that it is so exceptionally, incredibly, out-of-this-world good," Reyhan Ayas, a senior economist at the workforce-intelligence company Revelio Labs, said. "I feel like that's been brought down to earth." <h2> The arms race to give the best perks</h2>Understanding how Silicon Valley culture gave birth to a certain kind of overindulged tech worker starts with a history lesson. Vijay Govindarajan, a professor at the Tuck School of Business at Dartmouth College, told Insider that as long ago as the 1980s, tech companies aimed for an open, more-informal office culture, the better to spark innovation. Part of that approach involved creating strong social bonds among employees. Open-office floor plans, communal kitchens, and freebies like food and coffee encouraged employees to gather up and share ideas. It effectively turned lunchtime and coffee breaks into working hours. It became a recruiting tool, too. When companies wanted to lure and keep parents, they began offering maternity perks, on-site childcare, and lactation rooms. To recruit young professionals who were fresh out of college, companies tried to mirror college dormitories, Michael Malone, a tech historian and author who recalled seeing Pilates balls and video games at the former search-engine giant Yahoo, said. "Your private life and your work life began to slide into each other. That was kind of cynical by these companies in the sense that 'We expect you to kind of <a href="https://www.businessinsider.com/employees-who-live-at-google-2014-9">live here</a>,'" Malone said.Office designs and perks eventually turned into an arms race as companies competed for not only the most talented people, but also for those who wouldn't mind logging a lot of hours. If one company is providing free food, then the other must up the ante, Govindarajan said. Google became famous for its <a href="https://www.eastbaytimes.com/2007/03/10/for-google-employees-commuting-is-a-perk/" target="_blank" rel="noopener">commuter buses</a>, rock-climbing wall, <a href="https://www.businessinsider.com/coolest-perks-of-working-at-google-in-2017-2017-7#perhaps-one-of-googles-most-well-known-perks-employees-can-eat-every-meal-at-work-for-free-and-save-a-ton-of-money-1">on-site gym, and in-house massage therapists</a> or massage chairs, depending on the campus. Microsoft <a href="https://workforce.com/news/microsoft-does-a-benefits-tech-makeover" target="_blank" rel="noopener">paid for its employees' healthcare</a>. Apple started holding <a href="https://www.businessinsider.com/perks-apple-employees-benefits-2017-11#mothers-can-take-up-to-18-weeks-of-fully-paid-leave-after-giving-birth-with-an-additional-six-weeks-of-unpaid-leave-after-that-4">Beer Bashes</a> where the company treated employees to free beer, food, and concerts by popular artists such as Maroon 5. Meta installed <a href="https://www.businessinsider.com/facebook-employee-perks-benefits-2017-11#valet-parking-for-the-menlo-park-headquarters-along-with-a-free-charging-station-for-electric-cars-10">on-site dental and healthcare</a>, along with dry-cleaning services, and a bike-repair shop. And both Apple and Meta pay a portion of their <a href="https://www.businessinsider.com/apple-and-facebook-pay-women-to-freeze-eggs-2014-10">employees' egg-freezing</a> costs to win over prospective mothers.Those perks came with a bump in salary expectations, too. Young people were graduating with desires of <a href="https://www.nytimes.com/2011/03/26/technology/26recruit.html" target="_blank" rel="noopener">becoming the next Mark Zuckerberg</a> as they watched "The Social Network" in 2010, watched his company pull in $1.5 billion in venture capital in 2011, and then watched it achieve IPO in 2012. Google raised the salary of entry-level positions by as much as $20,000, The <a href="https://www.nytimes.com/2011/03/26/technology/26recruit.html" target="_blank" rel="noopener">New York Times</a> reported, to keep its college-to-company pipeline going. Across the industry, companies went from offering restricted-stock units in less than half of all compensation packages to the units being a top employee perk. <h2>Pandemic fueled the frenzy before the crash to Earth</h2>Recent tech layoffs came after a robust hiring period that occurred during the pandemic-induced shift to digital working in 2020 and 2021. The industry and its eager investors were convinced that the stay-at-home orders had accelerated the country and the world into its digital future. Tech professionals benefited because it boosted demand for their skills and boosted their compensation. The Great Resignation, where people quit in droves in favor of better-paying opportunities elsewhere, also bolstered the thought that there was job security in the sector. Young tech workers took to TikTok to show off their offices, perks, and the lifestyles they afforded on high entry-level or junior salaries. The videos attracted hundreds of thousands, if not millions, of views and further pushed the narrative that tech was the "it" industry.<h2>Reality sets in for the tech industry</h2>Then, reality set in as the economy started to sour."It went from negotiating salary like crazy and complaining that they had to work past 4 p.m. or whatever, to realizing that working in tech doesn't make them that exceptional and they're also at the mercy of potential layoffs," Ayas said of the rupture point.Spending so many years in the comforting embrace of tech, and then the harsh wake-up call of reality, disoriented and upset many regardless of whether it affected them.An ex-Googler who was handed a virtual pink slip told Insider she "mourned" the loss of her job and that the <a href="https://www.businessinsider.com/google-engineer-laid-off-mental-health-leave-mourned-email-2023-1">layoff felt "un-Googley.</a>" A laid-off <a href="https://www.businessinsider.com/meta-employees-react-layoffs-mark-zuckerberg-facebook-2022-11">recruiter from Meta said she felt "hurt."</a> Those who are still on payroll have been left with feelings of survivor's guilt and anxiety around whether they are next.It's unfortunate, Govindarajan said, but he added that these tech companies have disrupted other industries like photography, automobiles, and department stores."There are many industries the tech sector disrupted where people got laid off. But now it's the turn of the tech sector itself," he told Insider.

Tech companies spoiled workers for decades. Now layoffs are bringing them down to Earth.

<ul class="summary-list"><li>Small businesses owners have struggled during the pandemic, with the number of small businesses in the US dropping by 29% since January. </li><li>Meanwhile, massive companies like <keyword id="18635" type="CITY" weightage="60" keywordseo="Amazon">Amazon</keyword> and <keyword id="80487" type="COMPANY" weightage="60" keywordseo="walmart">Walmart</keyword> have seen their valuations explode by billions of dollars. </li><li>Even before the pandemic, the playing field has been increasingly tilted to favor massive companies over small businesses.</li><li>As businesses hope for a brighter 2021, the US needs to make changes that allow small businesses to actually compete with the Amazons and Walmarts of the world. </li><li>"The word recovery implies that we're going to recover them back to where they were," said Luz Urrutia, CEO of Opportunity Fund. "Where people of color, minority, immigrant, and women-owned businesses were was not a good place."</li></ul>2020 was a horrifying year to be a <keyword id="6359222" type="UNKNOWN" weightage="60" keywordseo="Small-Business">small business</keyword> owner. Yet, for some of the biggest companies in the US, the pandemic has been a financial boon, as companies like Amazon and Walmart bring in billions. For small businesses that manage to make it through the current public health and economic crisis, the pandemic needs to be a wake up call. The current playing field is tilted to support mega-companies over small business owners. In a crisis, this playing field becomes more uneven - but, even in brighter economic times, the inequality remains. It is too late to save the thousands of businesses lost during the pandemic. But, we need to act now if we want to prevent a vicious cycle that requires sacrificing a dwindling number of small businesses from continuing far beyond 2020. Read more: <a href="https://www.businessinsider.com/mcdonalds-investor-ctw-calls-for-resignation-of-chairman-2020-12">McDonald's investor explains why he and others are calling for the resignation of the fast-food giant's chairman</a><h2>Small businesses are feeling the pain</h2><div type="image" title="NYC coronavirus Manhattan restaurants small business closures" height="1666" width="2222" msid="80084465" hostid="261"></div>The pandemic has been an apocalyptic event for small businesses. The <a href="https://tracktherecovery.org/">number of small businesses</a> in the US has dropped by 29% since January and revenue has plunged by 31.9% over the same period. But, theses closures are not an inevitable side effect of the pandemic. Instead, it is an acceleration of what has been happening for decades - big businesses consuming more of the pie, while small businesses fight over an ever-shrinking mound of scraps. In 2000, 15% to 20% of small companies became medium or large companies every year, business professors <a href="https://hbr.org/2019/08/the-gap-between-large-and-small-companies-is-growing-why">Vijay Govindarajan and Anup Srivastava reported in Harvard Business Review.</a> By 2017, that figure had been slashed by half. "Going into the pandemic, I have never seen the playing field more tilted" to the advantage of a handful of big businesses, Moody's analyst Charlie O'Shea told Business Insider. "If you don't have the bucks, you can't make the investments and you can't compete on a level playing field," O'Shea said. Prior to the pandemic, roughly half of small businesses only had enough cash to stay in business for 27 days if they stopped bringing in money, <a href="https://www.businessinsider.com/how-long-companies-can-survive-without-bringing-in-money-2020-3">according to a JPMorgan Chase Institute analysis.</a> A quarter had a cash buffer that would last them fewer than 13 days. The pandemic put these cash buffers to the test. And more than 163,700 businesses failed that test, according to a September Yelp report, shutting down amidst financial hardship.<h2>Big business got bigger in the pandemic </h2><div type="image" title="Amazon HQ2 headquarters New York City canceled amazno" height="1379" width="1839" msid="80084469" hostid="261"></div>The fact that the largest companies in America thrived in a year marred by pandemic is an uncomfortable reality of 2020. The S&amp;P 500 is up nearly 16% in 2020. Amazon shares are up 73%, Walmart's shares increased by 22%, and <keyword id="6378093" type="UNKNOWN" weightage="60" keywordseo="mcdonalds">McDonald's</keyword> are up 7%. "We've used the term <keyword id="6354851" type="UNKNOWN" weightage="60" keywordseo="retail">retail</keyword> Darwinism for a few years now," O'Shea said. "It's just crystallized during the pandemic." Meanwhile, half of small business owners say that they will be forced to close if current business conditions continue for more than a year, according to a MetLife &amp; US Chamber of Commerce Small Business Index survey released in mid-December. "People were in total shock" when the pandemic began, said Luz Urrutia, CEO of the small-business lender Opportunity Fund. "Small business owners were at home [asking] what do we do now? What happens? This is our lives, this is our livelihoods. This is our family."The situation is even more dire for entrepreneurs of color.Beyond the <a href="https://www.cdc.gov/coronavirus/2019-ncov/covid-data/investigations-discovery/hospitalization-death-by-race-ethnicity.html">disproportionate health impacts</a> of the pandemic, <a href="https://www.uschamber.com/series/above-the-fold/small-business-owners-still-feel-pain-of-pandemic-and-fear-more-come">41% of minority-owned small businesses</a> are concerned about the impact of the pandemic on their business compared to 31% of non-minority owner businesses. 39% of minority-owned small businesses are very concerned about the impact of the pandemic on their mental health, versus 23% of non-minority-owned businesses. "Investors believe that the large companies are at least as better off as at the start of this year," Govindarajan and Srivastava said in an email. "The same cannot be said about the small and medium enterprises. Many are not sure whether and when they would be able to resume their business, if at all." <h2>Why Big Business is thriving</h2><div type="image" title="walmart new test stores" height="1392" width="1857" msid="80084473" hostid="261"></div>Experts say that there are three major reasons why big businesses are breaking financial records while small businesses flounder during the pandemic: financial positioning, lobbying power, and tech investments. Curbside pickup and mobile apps have been boons for fast-food chains like McDonald's. The ability to quickly and reliably ship online orders is increasingly crucial, boosting sales at companies like Amazon and Walmart that have invested in tech and logistics. This advantage was especially important this holiday season, when e-commerce made up 19.7% of overall shopping, compared to roughly 13.4% in 2019, according to Mastercard SpendingPulse. In some ways, big businesses have been able to thrive simply because they can give customers whatever they want to buy, cheaper and quicker than the competition. But, blaming customers' choices for small businesses' demise ignores two of major factors - their cozy relationships with the government and financial institutions.An Associated Press analysis found that bigger businesses <a href="https://apnews.com/article/38e820a06d0346e7a662d5051926cb37">disproportionately received Paycheck Protection Program companies first,</a> thanks to pre-existing relationships with banks. Govindarajan and Srivastava say that larger companies' superior lobbying power historically helps them get subsidies and concessions during economic downturns. Small business advocates argue this has continued during the pandemic, with aid shaped by massive companies' desires. "A lot of people in Congress say they are pro-business, but what they really mean is pro-big business," Bharat Ramamurti, the managing director of the corporate power research program at think tank Roosevelt Institute, <a href="https://www.vox.com/the-highlight/21320361/small-business-closing-covid-coronavirus-ppp-entrepreneur-economy-stimulus-loans">told Vox.</a>Saying Americans simply prefer Walmart or Amazon also erases that for many customers, where they shop isn't a choice as much as it is a necessity. "I think many consumers would like to support their local establishments, where they have relationships, where they have a history, but that only goes so far as your wallet [or] your pocketbook will carry you," former Sears executive and Columbia Business School professor Mark Cohen said.<h2>America is stuck in a vicious cycle</h2><div type="image" title="Small business owner" height="2400" width="3200" msid="80084475" hostid="261"></div>Americans have seen what the big business boom looks like - and it's not good. While individuals might get <a href="https://www.theatlantic.com/magazine/archive/2018/04/learning-to-love-big-business/554096/">better benefits working at a bigger company</a> or lower prices in chains' stores, the tilted playing field between big and small businesses has concrete, negative effects on the nation.Entrepreneurship, along with homeownership, is one of the most prominent ways for Americans to build wealth, according to Urrutia. But, small businesses are making up less and less of the <keyword id="34412" type="ORGANIZATION" weightage="60" keywordseo="economy">economy</keyword>. It is increasingly challenging for these companies to compete. As small businesses vanish, it leaves many people of color - <a href="https://www.businessinsider.com/personal-finance/what-want-black-women-know-about-building-generational-wealth-2020-6">already with less generational wealth than white families</a> - with one fewer option to build wealth. The trend favoring big businesses coincides with a widening gap between the rich and poor in the US. Income has<a href="https://www.epi.org/publication/charting-wage-stagnation/"> stagnated for most workers</a> in recent decades when adjusted for inflation, despite net productivity growing by 70% since the early '70s. Income inequality has increased steadily since the 1980s, <a href="https://www.businessinsider.com/us-income-inequality-record-high-generational-wealth-2019-9">according to US Census data.</a> The 1% now controls about 37% of the wealth in the US, <a href="https://www.businessinsider.com/charts-why-inequality-is-a-major-american-political-issue#the-share-of-wealth-accruing-to-the-top-1-of-that-distribution-follows-a-similar-trajectory-as-income-but-with-an-even-higher-degree-of-concentration-2">nearing Gilded Age highs.</a> Customers shop at companies like Amazon, Walmart, and McDonald's that offer lower prices and convenience because it is what they can afford. Big business puts small business out of business with its superior deals. As a result, it becomes harder for the average entrepreneur to start and maintain a new mom-and-pop shop and build wealth.It's a vicious cycle that has continued for years. The pandemic only made an existing problem even worse. <h2>The pandemic forced the broken system into the spotlight</h2><div type="image" title="small business reopen reopening" height="2000" width="2667" msid="80084477" hostid="261"></div>Cohen and other experts argue that the system needs to right itself, or the American economy will simply cease to function.The US will not recover economically, according to Cohen, until people are employed and have disposable income. That requires healthy small businesses. So, Cohen believes, political and corporate leadership will finally take the steps to make that happen."We're in for a whole lot more pain and suffering than we've seen," Cohen said. "But in the longer term, I really have an abiding belief in the power of the crowd to lift itself out of the muck. We have the opportunity to do that, by exercising a belief, wisdom, ambition."Experts offer an arsenal of options for how small businesses can be allowed to compete more fairly with the Amazons of the world and give Americans the financial flexibility to support small businesses.Cohen emphasized the importance of new government policies, such as higher minimum wage and tax reform. Urrutia sees expanding small businesses' access to capital, as well as services such as advertising and technology, as key. "I don't like to use the word recovery because the word recovery implies that we're going to recover them back to where they were," Urrutia said. "Where people of color, minority, immigrant, and women-owned businesses were was not a good place. It was not a solid foundation.""I talk about reversing, rebuilding and regenerating," Urrutia continued. "We don't want them to recover to where they were before."

You Searched For "Vijay Govindarajan" and got 5 results

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