Facilitating software entrepreneurs towards growth : Suwipa Wanasathop, Director, Software Park Thailand, India

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Software Park Thailand came into existence way back in 2000, at a time when the economy was going through a rough time. What were the principal objectives and vision behind establishment of the

Software Park Thailand?

Software Park Thailand is a semi-government operation established under the National Science and Technology Development Agency (NSTDA) within the Ministry of Science and Technology.  It was approved by the government in 1997 and became fully operational in 2000 with the aim to promote the growth of Thai software industry by attracting local and international partners to form a cluster of software-related businesses, and providing supported services including world-class infrastructure and facilities, human resource development, business development and marketing enabling, facilitating investment and funding, and even introducing the latest technology.

Our vision is to become a top-rate learning organisation that supports entrepreneurs to create a strong world-class software industry, making software an enabler for competitiveness of the Thai economy.

What are the principal services and facilities provided by Software Park Thailand in terms of developing the domestic and International

IT industry?

To achieve our goals, a number of services and activities are being offered. Software Process Improvement Centre (SPIC) serves the Thai software industry through acting as a resource centre providing assistance to software companies to achieve business excellence.

The centre provides them with consultation in implementing and institutionalising internationally accepted frameworks SW-CMM, CMMI and ISO. Business Development and Market Enabling Department supports operators in the Thai software industry in the fields of marketing, public relations, networking with other software developers as business partners. To date, the department has forged over one thousand business alliances.

Technology Transfer Department is tapping into human resource, which is one of the keys to build up a successful software industry. The department offers training for both individual IT professionals and organisations through our network of partners in academic, governments and private sector organisations. Incubation Centre provides help to nurture technology ideas into commercial successes.

Its mission is to provide the most enabling environment for the start-up companies or individuals that have growth potential in software development to create a successful business. The Centre provides workspace, constructive and supportive environment to software entrepreneurs at start-up and during the early stages of their businesses at no charge for a period of one-year in-wall incubation.

IT Consulting Centre for Industry handles industrial/business fusion with IT environment. The Centre was set up to enhance competitiveness of all other manufacturing and service industries through the use of software, and to form special interest clusters for software businesses that support interactions and transfer of practical knowledge and best practices among themselves and across clusters. Primary Business Legal Consulting has its mandate to advise and assist the IT companies and investors for their business establishment in Thailand.

The legal advice covers company registration, contracts, work permits and visa approvals. Facilities Services offer office spaces as well as the training facilities, which are rentable at reasonable price. It is part of our efforts to provide necessary infrastructure that supports the Thai software cluster and community. The Park is now the national focal point for those who want to do software business in Thailand and is housing about 50 software companies and 30 new start-ups.

Since the beginning of its operation, Software Park Thailand has served as a facilitator to foreign IT investors/enterprises aiming to set up their business in Thailand.

Mission statement of Software Park Thailand expresses a sincere intent of the organisation in taking forward the e-Government vision of the country and work towards developing and e-society. What are the prominent initiatives of the organisation in this direction?

In fact, Software Park Thailand is a software industry promoter and we know most of the players in the software field in Thailand as well as possess a strong international network.  Our direction is to facilitate software entrepreneurs in penetrating and expanding the market, to create a platform where buyers meet with potential sellers, to support buyers in other industry sectors so that the proper investment in IT and increase in competitiveness of all the sectors be it in e-Government, e-industry, or e-society projects can be achieved. Our business matchmaking activities have been quite successful and the Park has essentially been a market place for software.

Software Park Thailand has a special focus on IT-enablement of manufacturing and agricultural sector of the country. What special efforts have been put in for this purpose? What is the level of uptake of IT in these core sectors of the economy?

Some of Software Park Thailand’s missions resulted from the studies done in 1996 by the  National IT Committee to find ways to create strong viable software industry. The specific  mission on promoting the use of IT to all sectors of the economy to help increase productivity and competitiveness was added on after the study the National Economic and Social  Development Board in 2000 (by McKinsey – on productivity of Thai industries which showed  most industries to be using too little IT) and in 2003 (by Harvard Business School – on 5  strategic industries: food, fashion, automotive, tourism, and software – that showed need to  have software as enabler for all economic sectors). Since the studies then, Software Park  Thailand has put in several efforts in getting software to become the enabler of other local businesses, industries, and agriculture; not just focus in the export of software itself. Activities of the Business Development and Marketing Enabling Department and the IT Consulting  Centre for Industry, in particular, are strategically organised through different industry clusters to serve this purpose. To this end the overall benefit to the country has to be measured not just within the software industry but also to include the extra value-added to the competitiveness of other economic sectors where IT has been utilised.

What is the level of response from
overseas enterprises in term of setting up their  IT development centres in your Software Park? What is the span of the countries that are already here and/or in the process of coming up?

Since the beginning of its operation, Software Park Thailand has served as a facilitator to foreign IT investors/enterprises aiming to set up their business in Thailand. The responses from overseas IT-related enterprises are extremely strong, seen from the numbers of investment value each year. So far, more than 35 foreign-participation companies from 16 different nationalities have set up their operation in our Park. The companies expanding their businesses here are from various parts of the world including mostly from the North  America (US and Canada), and Asia (Japan, Korea, Taiwan, and Singapore).

The “Incubation Centre” of Software Park Thailand is known to have churned out a number of successful IT start-ups in Thailand. What is the adopted model of  incubation in this centre? What are the selection criteria and facilities provided through these centre?

Software Park Thailand Incubation Centre provides workspace, constructive and supportive  environment to software entrepreneurs at start-up and during the early stages of their businesses at no charge for a period of one-year in-wall incubation. If needed, entrepreneurs can continue to obtain our support for another two years of out-wall incubation. The Centre ’s strength comes from the tremendous support given by successful business people who act as mentors, consultants, VC/angle investors, instructors, etc. to help the new start-ups.

Individuals and start-up companies that meet the following qualifications can apply for entry  into the program. For this, they should have know-how in software development, and had  been an entrepreneur for no more than two years; have a viable business plan; have potential  growth in revenue and employment; participate in training, business networking and other  events; ready to commit to one-year incubation program; and, willing to work in a cooperative environment with other entrepreneurs and incubator personnel.

Incubation Process: The initial training in business plan writing is given free of charge about one month prior to application due date; the applicant submits the business plan to a panel of software business people, experienced business executives, technologists, and representatives from funding resources; selected entrepreneurs began their incubation period with assigned mentor.

These mentors volunteer their time once a month to advise the entrepreneurs. Each month, a  progress report is required from each participant to the incubation management; during the  incubation, a number of practical courses are offered to the participant in areas such as  project management, marketing, negotiation techniques, sales tips, presentation skills, legal  and business practices, software process improvement overview, etc; participants are invited  to exhibitors, trade shows, site visits to successful companies, special seminars, and all events  participated by Software Park Thailand; Media coverage of the products and services and  other marketing efforts to help getting their product and services to the market are also  supported; and, matchmaking with other businesses and funding sources are also organised for the entrepreneurs.

Software Park Thailand is also taking serious initiative towards promoting Data   Standardisation and Interoperability among the local IT industry. What is the present level of acceptance of such standards among Thai enterprises and user groups?

I must admit that Software Park Thailand has not done much in these areas except pointing out that these are the areas policymakers have to give the priority. The Ministry of ICT, SIPA,  NECTEC have worked on the issues but the tasks are quite complicated; therefore, take time.

Over the past few years, Thailand
software industry has witnessed a steady average growth rate of 20%, year-on year. What is the breakdown of this growth rate in terms of domestic and international business? What level of growth is expected from the industry over the next 5 years?

According to the study of ATCI (Association of the Thai ICT Industry) released in February  2006, Thai software market in 2005 valued at THB41,435mn(US$ 1,059mn) with an overall growth of 27% from 2004. Within this market value, 52% (THB21,401mn or US$  546.97mn) are packaged software, and 48% (THB20,034mn or US$ 512.04mn) are outsourced software. The study shows that the average growth of IT market from 2005-2008  will be about 20%. Specifically, the expected growths for each year of Thai IT Market are 19%  for 2006, 18% for 2007, and 22% for 2008.

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