IIPM - MEDIA: 2013

Tuesday, June 04, 2013

The way our patent act!

Lifesaving drugs, patented after ’95, will not come cheap

While India’s IT industry hogged media limelight for its breathtaking pace of growth over the last decade, the pharmaceutical industry too kept up the momentum, marching at a decent pace of around 13-14 per cent annually in a market that is estimated to be around $11 billion. The catalyst that got the juices flowing for the pharma industry was the Patent Amendment Bill (2005), which in line with the WTO agreement, got the ball rolling for both MNCs and indigenous companies in the sector. The Bill gave MNCs a strong regulatory framework that acted as a bulwark against cheap copy of their discovered drugs while local companies benefited by getting opportunities to tap the off-patented medicines. Indian pharma companies got another shot in the arm with the new Patent Act stating that only drugs invented after January 1, 1995, can be considered for product patenting.

Eight years hence, India is one of the five biggest pharmaceutical producers in the world, contributing to 10 per cent of the world’s drug production, amounting to $22 billion, up from $7 billion in 2005. And if growth comes can employment generation be far behind? A Department of Pharmaceuticals report indicates an employment figure of 340,000, which is split among 20,000 pharma companies across the country. Armed with such growth opportunities, India could become the potential pharma-superpower over the next two decades – a credit that goes singularly to the Patent Bill, 2005.

However, the Bill has had its fair share of controversies too. The main apprehension has been that it would allow the patenting multinationals to charge high prices for their drugs! The low elasticity of demand for pharmaceutical products, coupled with the aggressive marketing by big pharma companies, entails the risk of encumbering the low and middle income groups with financial stress. However, the recent Supreme Court ruling denying patent rights to Novartis’ anti-leukemia medicine, Glivec, has given reasons to belie such concerns. For instance, Glivec costs an unaffordable Rs. 1.2 lakh per month. But its generic formulation, made by domestic manufacturers, costs no more than just Rs. 8,000. The SC ruling came on the basis of the drug being developed before 1995, which made it ineligible for protection under the new Patent Act.

But the jubilation at the SC verdict is ephemeral. With the passage of time, chances of a drug being formulated before 1995 will gradually grow rarer. And that’s where the danger lurks. Abnormally high priced lifesaving drugs, formulated after ’95, will no longer be affordable.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman

ExecutiveMBA

Monday, June 03, 2013

Book Review: The Revenge of Geography

Reductionist scholarship

19th century American journalist and educationalist, Ambrose Bierce, in what was termed a bout of often frequent farsightedness, once quipped that “War is God’s way of teaching Americans geography.” Who would have known that even exactly 100 years after his demise, this man’s observation would still stand relevant.

By sheer coincidence, this also happens to be the year when American journalist Robert D Kaplan came out with his latest book, The Revenge of Geography: What The Map Tells Us About Coming Conflicts And The Battle Against Fate. As the title suggests, the book is an effort to know how geography has played its part in shaping geopolitics and how it does not plan to call it a day yet.

I am not exactly a fan of Kaplan’s writings or even thought process. I generally consider his previous works, including the better known Surrender or Starve: Travels in Ethiopia, Sudan, Somalia, and Eritrea and Soldiers of God: With Islamic Warriors in Afghanistan and Pakistan as a case of fish-out-of-water at the best and attempts towards utter reductionism at the worst. These books, although full of ingredients that make a non-fiction bestseller in the US, fared miserably at the Nielsen. In short, even average chest-thumping Americans took a very dim view of his writings. And that is quite low.

But still, these books tell a lot about how he constructs his arguments. Another book of his with the self-explanatory title Balkan Ghosts was again a non-starter. But somehow or other, President Bill Clinton got hold of a copy, and as legend follows, used the arguments put forward in the book to launch an attack on Yugoslavia. Kaplan’s star rose overnight, albeit for the wrong reasons. When George Bush was mulling an attack on Iraq, Kaplan supported the idea in a then secret meeting with Bush administration insiders. However, these days, he admits he made a mistake. This book is supposed to be the product of that learning curve.

So, let’s look at the premise of the book. The book explores a new paradigm, or if we believe the author, an omnipresent but rather ignored paradigm, that geography has pipped ideology as the anchor-stone of geopolitics in a post-Cold War world. That essentially means that nations decide upon their bilateral and multilateral relationships driven by compulsions of geography and not ideology.

While this analogy is as fresh as any, there are works of other theorists that the author draws on. In fact, Kaplan dedicates a substantial number of pages exploring often debunked theories of these geniuses. So, at the very beginning, readers are thrown into the world of English geographer and academic Sir Halford J. Mackinder, who’s ‘Heartland thesis’ is pitted by Kaplan against the ‘Rimland thesis’ of Dutch geo-strategist and his contemporary, Nicholas J. Spykman. Kaplan explores these ideas for the benefit of the readers and helpfully illustrates why they failed. The problem starts when he presents some of his vague ideas and seeks to draw examples from the contemporary world.

While some of them do hold water, the others fall flat. Take for example Panama Canal. Kaplan maintains that it was the specific geography of Panama that led to the canal and dominance of the US in both Pacific and Atlantic. Had Panama not been there, it would have not been easy for the Americans to surpass Brits at sea. Kaplan theorizes that since Britain was positioned as an island west of mainland Europe, it was geographically well placed to outmanoeuvre Portugal and the Netherlands, which it eventually did, in the war of dominance on water. The US did the same with Britain with Panama Canal. This I concede is a remarkably fresh idea.

However, he fails when he draws parallels between Saudi Arabia and Iran by asserting that these are loose conglomerations of ethnic groups, peoples and lands. And their political centres more often than not cannot hold their distant dominions. Anybody who knows the region will only laugh at this. Similarly, he concedes, rather miserably, that autocrats in Russia, from Stalin to Putin, were necessitated by its ruthless geography.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

BBA Management Education

Saturday, June 01, 2013

Book Review: Cell Phone Nation

India without the wires

The cheap mobile phone is probably the most disruptive communicative device in history. In India its potential to stir up society is breathtaking, argue well known historian Robbin Jeffery and leading anthropologist Assa Doran.

The authors are familiar with the emerging landscape in India for more than two decades now. Jeffrey is a visiting professor at the Institute of South Asian Studies and Asia Research Institute, at National University of Singapore, and has also written on the rise of vernacular dailies in India. Doron, a research fellow in the College of Asia and the Pacific, Australian National University, Canberra, too has an earlier India book - Caste, Occupation and Politics on the Ganges: Passages of Resistance.

“Like shoes, mobile phones have become an item that almost everyone can afford and aspire to. Unlike shoes, mobile phones often get taken to bed,” the duo writes in Cell Phone Nation: How Mobile Phones have revolutionised business, politics and ordinary life. The authors explore this theme in the context of India to understand the impact of the cheap mushrooming of communication devices, a revolution for a country that until 1991 had only one phone for 165 people.

All this changed in the first decade of the 21st century and by 2012 mobile phone subscribers in India exceed 900 million out of the 1220 million population. It is ironic that India had far more mobiles than it had toilets of any kind; 53 per cent of the country’s 247 million households still defecated in the open; but mobile phone density in 2012 approached 72 per cent.

The impact of the simple version of the device has been deep. Village councils continue to ban unmarried girls from owning phones. Families have debated whether their new bride should surrender them. Cheap mobile phones have become photo albums, music machines, databases, radio, flashlights… Religious images and uplifting messages continue to flood tens of thousands of millions of phones each day. On the other hand pornographers and criminals have found a tantalizing tool.

Each of the eight chapters is worth a book in itself. The canvas has been divided over the concept of three ‘Cs’. The first is ‘Controlling’, which examines how people struggle to control information, beginning with sub-continent’s Mughal rulers 500 years ago but quickly moving to radio frequency spectrum and nexus of big business, politicians and bureaucrats, and discusses the 2-G scam and infamous Radia tapes.

Second part of the book focuses on who did the connecting ranging from the fast living advertising women and men of Mumbai to small shopkeepers persuaded by their suppliers of the fast moving consumer goods to stock recharge coupons for pre-paid mobile services.

Also what made the cell phone revolution possible in the billion-plus nation conscious its caste and class hierarchy is that it developed the cheapest mobile call rates in the world and turned pre-paid mobile phone plans into a complex and much talked about subject. In 2010, a US dollar (Rs 50) bought more 200 minutes of talk time on an Indian mobile phone; in Australia, it often bought less than one minute. At one point of time, the cost of making an international call from India for three minutes was Rs 300. Today, it is as low as Rs 20.

With mobile phones invading every section of the society, authors tell us how masses became consumers. This occupies the third part of the canvas - consuming in a multitude of ways. “Mobiles were used for business and politics, in households and families to commit crime and foment terror. Some of the practices enabled by the mobile phones were new and disruptive,” the authors observe.

At the most phones brought fundamental changes in the lives of people at the bottom of the pyramid whether it was fishermen in Kerala or Banaras with tips on the rough weather on seas or marginal farmers with farm advisory or money transfer in unbanked areas.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

ExecutiveMBA

Friday, May 31, 2013

'Global Zero' Possibilities

A nuclear-weapons-free world seems a dream; no harm trying...

The IAEA Director General, Yukiya Amano recently mentioned that “as a human being, as Director General of the IAEA – and not least as a citizen of the only country ever to experience the unspeakable horror of nuclear bombs – I believe with all my heart and soul that these horrific weapons must be eliminated.” What is unique in his statement is that such talk of a nuclear-weapons-free world has almost but vanished even from the lexicons of peaceniks. You see, it’s now considered childish to recommend such paradigm reversing objectives. Nuclear weapons are surely here to stay... or are they? Could there really be a possibility of a nuclear-weapons-free world? Well, as one defence commentator put it to yours truly, if India could eradicate polio, then anything is possible. Not many might remember that the Nuclear Weapons Convention (NWC) has actually aimed at the complete elimination of nuclear weapons. Those in the know would remember the global campaign called “Global Zero” which was launched in Paris in 2008 for the elimination of Weapons of Mass Destruction (WMD). Yet, against the backdrop of the renewed nuclear race – encompassing Iran, India, Pakistan, Korea, China etcetera – it’s quite unlikely that the philosophies of the NWC or Global Zero campaigns would cut any ice with the global warlocks.

As per various estimates, there are more than 23,000 nuclear warheads active in the world, most with the old foxes (America and Russia primarily); that’s one reason that nouveau entrants into the nuclear club too have all their guns blazing. North Korea, which conducted its third nuclear test last month, stated that they are developing this, targeting the US over its hostile interference in Pyongyang. Iran’s supreme leader Ayatollah Khamenei, who had urged the elimination of nuclear weapons previously, has warned that “no power could stop us if we are forced to build that.” And the less said about Pakistan, the better.

While US President Obama did mention his objective “to secure the peace of the world without nuclear weapons” in his initial addresses in 2009, he ignored such a mention in his January 2013 inaugural address. Even Senator John Kerry recently admitted that “a nuclear-weapons-free world is no more than an aspiration.” Yet, one cannot deny that nuclear weapons have not been used since 1945. For instance, the United States and Soviet Union were ready to accept their embarrassing defeat in their wars in Afghanistan and Vietnam rather than use nuclear weapons for a desperate win. South Africa has rejected nuclear weapons post the Cold War.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

BBA Management Education

Wednesday, May 29, 2013

Book Review: Tata Log

The company one keeps

Since 1868, when the founder and first chairman Jamsetji Nusserwanji Tata established a private trading firm in Mumbai. it has not only grown and transformed into India’s premier industrial house but has also touched everyone’s life with salt to satellite television, steel to supercomputers to automobiles and what not. Not a day goes by when we are not touched by some or the other Tata product or services or news about them. The latest offering was the ascendency of Cyrus Mistry replacing Ratan Tata as chairman of Tata Group.

It is one industrial house in India that has been well chronicled beginning with RM Lala— the man who penned books such as The Creation Of Wealth: The Tatas From The 19th To 21st Century and Beyond The Last Blue Mountain: A Life Of J.R.D. Tata. Three years back, Morgen Witzel, a leading business historian authored a book Tata: The Evolution of a Corporate Brand. What differentiates Tata Log, written by Harish Bhat, managing director and CEO of Tata Global Beverages, from the previous works is that it attempts to portray how Tata companies have broken new ground and set new standards of excellence over the past two decades since the Indian economy was liberalised in 1991. Secondly by focussing on people who were involved in different projects closely and their dreams and dilemmas, crises and challenges, Bhat has captured the subaltern view of the post-liberalisation decades.

An old Tata hand, Bhat, who has been trying his hand at writing besides managing workers and business, has carefully chosen eight stories that reveal the Tata way of life. This lends a human touch to the Tata Group.

The book begins with the making of India’s first indigenously designed car, the Indica, followed by how Tata Chemicals in Mithapur is transforming the lives of a community in a far-flung, semi-arid corner of the country committed to social causes as diverse as raising the water table in a barren area to protecting the endangered whale shark. Equally interesting is the tale of Tanishq, and how Titan Industries is modernizing and transforming the huge jewellery industry in India.

The chapter on the tribulations of Tata Finance that brought out the worst and the best in the group is timely as Tata Capital is trying to emerge as a new player in the market.

Equally amazing is the story on Second Career Internship Programme, or SCIP, of the Tatas, which offers a second career to women who take a break to raise a family, and the building of the world’s fourth fastest and Asia’s fastest supercomputer-‘EKA’ by S Ramadorai and his team. These chapters peep into how Tata Group transformed itself and various communities and stakeholders around them.

Two stories - one on the first-ever acquisition of an iconic global brand by an Indian company - Tetley and the other about how Tata Steel became the first Indian organisation to win Japan’s prestigious Deming Prize for quality - have been showcased by the author to illustrate Tata’s arrival on the global scene more emphatically than ever before.

As a good storyteller, Bhat has taken care to pepper each of the chapters with interesting anecdotes. For instance he quotes Xerxes Desai, the man who founded Tanishq, to reveal that the name was actually inspired by a Harlequin Great Dane owned by him. The dog was called Monishqa.

In all these eight stories Bhat tell us that the Tata Way is all about 4Ps — pioneering, purposive, principled and perfect - and builds his case to exemplify these 4Ps.

If Bhat chooses to tell us how the group transformed after Indian economy began to walk on the path of liberalisation, he ought to have included the Nira Radia episode, the telecom scam, and the withdrawal of Nano project from West Bengal. But none of these finds a mention in Tata Log.
As the title suggests, Tata Log is at best a record keeping or about ‘Log’- people. Of course it is a question whether somebody like Bhat, who is a sensitive insider, would have dared to include these episodes. Also missing is the extraordinary response of the staff of the Taj Mahal Hotel in Mumbai during 26/11 attack.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face

BBA Institute

Saturday, May 25, 2013

Passing the baton

Jaipur marks a watershed in Congress’ chequered history by ushering in Rahul Gandhi as a new year gift. Pramod Kumar reports from the Chintin Shivir

The glorious history of Rajasthan, given its geographical location, is replete with instances of valour and comebacks, of success stories pulled out of thin air and against all odds.

Rahul Gandhi’s ‘coronation’ as the virtual heir apparent to India’s ruling dynasty at this week’s Chintin Shivir in Jaipur should be seen in that backdrop.

There was pathos, tears and raw emotion, all ingredients that make up for family melodrama and have the potential to move the masses politically, as few other slogans can.

The Rahul Gandhi that came out was the new face of the Congress: young, exuberant, ready to take on challenges and the country onto another level. More pertinently, there was the promise of new politics, slogans and faces; it was as if a beleaguered Congress party was trying to exorcise the ghosts of the UPA as 2014 draws close and who better than Rahul to navigate the treacherous road ahead?

The unofficial handing over the baton to Rahul was by no means an accidental happening, it was carefully choreographed from start to finish. The developments that unfolded had keeping the Election Commission’s Code of Conduct in mind. First Rahul was introduced at New Delhi’s Ramlila Grounds on November 4 last year to ‘acquaint’ him with party workers; on November 9, in the next round, it were members of the Congress Working Committee (CWC) who were formally introduced to Rahul. These were traditional testers to gauge the mood of the cadres - not that it was required - but in the light of Rahul’s somewhat unsuccessful 2012 with reverses in UP and Gujarat, no one in the party was willing to take any chances.

Once the core group around Congress president Sonia Gandhi decided that the Gandhi family grip on the party apparatus had in no way declined, then it became a question of time and matter of completing formalities. As a background to the carefully orchestrated coronation, young ministers were inducted in the Union Cabinet as a first step; the Chintin Shivir then only became an occasion to formalise a political contract which everyone knew existed.

Sonia herself set the ball rolling when she emphasised that policies need to be framed keeping the aspirations and frustrations of the angry youth in mind, whose issues could no longer be ignored.

It was known in the party that there would be a Jaipur Declaration and it would be headed by Rahul. It did not quite happen that way. On the second day of the proceedings, the Jaipur Declaration came and went without causing too much of a flutter; Rahul’s induction became the biggest event for Congress in the New Year.

An actual look at proceedings will tell you that after Rahul, the buzz was around young ministers. Jyotiraditya Scindia, Milind Deora, Jitin Prasad, RPN Singh and Sachin Pilot, were all flavour of the meet. A very busy BK Hari Prasad and Mukul Wasnik showed that the Jaipur Chintin Shivir, more than anything else, signaled yet another generational shift in India’s first political family.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

ExecutiveMBA

Friday, May 24, 2013

Movie review :Table No 21

Heavy weather in cool climes

It isn’t love that makes the world go round for Fiji resort owner Abdul Razzaq Khan (Paresh Rawal). Fear does. He asks the male protagonist: do you believe in God? Yes, the latter replies. No, you fear God, retorts Mr. Khan. For good measure, he adds: “Dar sey hi dunia chalti hai.”

You squirm: God! Is Paresh Rawal still in OMG mode? He isn’t. There is no Akshay Kumar here in the guise of Lord Krishna; for Table No. 21 is neither a social satire nor a profound cinematic discourse on the flip side of faith. Is it, then, a dark thriller that pulsates with life? That neither. Simply put, it is an eminently forgettable film.

On the face of it, Mr. Khan isn’t a pleasant guy to know. He employs all the dread that he can drum up and paints an unsuspecting couple, Vivaan and Siya Agasthi (Rajeev Khandelwal and Tena Desae), into a murky corner that proves too difficult for the lovey-dovey duo to squeeze out of.

For sure, Mr. Khan isn’t playing harmless games. He actually has a deadly point to prove, but we know not what he is really up to until the very tail-end of Table No. 21. Not that it matters.

In Aditya Datt’s cat and mouse thriller, the natural beauty of the salubrious island location far outstrips the less-than-dramatic energy of the fictive battle of psychological attrition that plays out as a series of tricky questions and tasks that Mr. Khan, as the host of an online game show, comes up with for the couple.

The basic premise of Table No. 21 is intriguing enough; the performances are adequate, if not spectacular and the cinematography and editing are both of the highest order. What the film lacks is a genuinely gripping storyline.

The screenplay is overloaded with clichés right out of more conventional Bollywood melodramas – an out-of-work young man struggling to make ends meet and waiting for his big break; a doting wife as adept at romping in an itsy-bitsy bikini on a beach as at going the extra ‘immoral’ mile in keeping the home fires burning, and a deceptively courteous tormentor hell bent on messing up the twosome’s not-so-hard-earned idyllic vacation.

“Secrets are sexy”, Mr. Khan intones, his voice dripping menace. But he isn't the only one who has reasons to keep his cards close to his chest. Vivaan and Siya, too, have demons from the past to deal with.

The tale of sweet nothings, half-truths and betrayals that lie at the heart of Table No. 21 – the number refers to the Article of the Indian Constitution that guarantees “protection of life and personal liberty” – has a high-minded purpose.

Sadly, the methods it uses to get its point across are painfully laboured. Neither the social objective of the statement that it makes nor the dramatic intent of the mise en scène is served well enough in the bargain.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

ExecutiveMBA

Saturday, May 11, 2013

KIDNEY TRANSPLANTATIONS: DELAYS

Stringent laws and complicated procedures are delaying the kidney transplantation process killing more people in the process

This amendment may have succeeded in controlling the kidney racket scandal to a certain limit but it has several loopholes. Mostly, it has been severally criticized as being an unduly elongated process to get approvals for unrelated kidney donation. Due to the lengthy procedure and absence of government nominees on the authorisation committee, transplants have been stalled or delayed in several hospitals. One nephrologist from a reputed hospital said, “We appreciate the move of the government but the procedure has been moving at a snail’s pace.”

In one example, in 2011, many transplants in Maharashtra got delayed for a few months in several hospitals due to delays in release of authorisation letters. Although there is no official data on whether any deaths took place due to delayed release of approval letters, there is no doubt that this may have been the case. Kidney transplantation on an average burns the pocket of an individual by almost Rs 400,000 (if the same is done legally!); post-operative expenses come to around Rs.10,000 per month! And in case the deal is illegal, then the recipient’s family has to conjure up another Rs.200,000 to Rs.400,000.

In reality, the stringent laws that have come into force have not been able to completely curb the illegal kidney racket – but worse, in some cases, have ensured that honest and emergency cases of transplants have not been processed in time. The need of the moment is for the government to now set a more stringent time-bound condition on the Authorization Committee to clear any pending case for kidney transplantation within 24 hours of them receiving the application. If such a time duration seems too less, then the government should immediately disband the concept of an authorization committee which does not understand the criticality of life and death situations.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

ExecutiveMBA

Thursday, May 09, 2013

Shifting your focus to match customer needs

It is critical for organisations to adopt a scientific approach to understanding how they can meet customer needs, and to firmly ingrain a customer-focused culture throughout the organisation

We have often heard the phrase, “Customer is king”. While it is self-evident that higher satisfaction levels give a company an edge over sales, company growth and reputation, what it really does in the long term is to ensure that existing customers stay happy, resulting in better relationships and happier employees. Customer-focused companies are more attuned to the market and better able to stay ahead.

I refer to Harley-Davidson’s customer focused culture as one of the best in the world. It is the longest, continuous manufacturer of motorcycles in the US and has outlived nearly all of its competitors. In the twenty short years since Harley-Davidson started its Owners Group programs, it has grown to over 500,000 members & each of them own at least one motorcycle. The question to ask is: Is there any other consumer product in the world that will prompt customers to travel over several continents to be part of a group experience? Customers and employees alike take great pride in their affiliation with the company and this continues to make Harley-Davidson one of the great success stories of our time.

There is simply nothing – nothing – more important than getting to know the needs of your customer in a detailed and scientific manner. In the words of Michael Dell, “By spending time with your customers where they do business, you can learn more than by bringing them to where you do business”.

80% of companies believe they deliver a superior customer experience; however, only 8% of their customers agree. Why? Your customers are looking for maximum value when spending their hard-earned cash, particularly in this economy. The customer experience requires the active participation of everyone in your organization. This is where the word “Satisfy” comes into play. What it means is that your company is providing nothing more or less than what the customer expects. Creating a customer-focused culture is a proven strategy for both short-term success and long-term growth.

Going by the industry’s best practices, let me share with you some key insights into what will really work for you or your company.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

BBA Management Education

Wednesday, May 08, 2013

The brightest stars in Indian politics, Rajiv Gandhi

Known as one of the brightest stars in Indian politics, Rajiv Gandhi’s assassination shook up the foundation of the Congress party. A documentation of how his death reversed fortunes of the party, and dramatically altered the Indian political scenario...

What is most interesting about the post-Rajiv era is the shape Indian politics took after 1991. During the 1991 elections, the Congress was expected to win the largest number of Lok Sabha seats. That happened. But after the assassination, with no one from the Nehru-Gandhi family at the helm, the Congress party started to grow weak. Although the party was in power from 1991 to 1996 under Narsimha Rao, it started losing ground in crucial states, one of which was UP. The the emergence of regional parties and the rise of rightists led by the BJP made the environment more challenging for the Congress. With no charismatic leader to take control, the fortunes of the Congress looked to be on the decline. The regional sections of the Congress and the anti-Nehru-Gandhi factions grew stronger with the rise of Narsimha Rao and Sitaram Kesari. “With Narsimha Rao as PM and Kesari as party president, Mandal-Kamandal (OBC reservations – Hindutva) politics became too prominent. It was around this time that BJP first emerged as a probable alternative,” says Dutta.

The assassination of Rajiv led to the emergence of BJP with the Ram Mandir movement. Politics over religion was at its helm. Lok Sabha elections a year after the Babri Masjid demolition saw the BJP-led-NDA come to power with Atal Behari Vajpayee taking over as PM.

In a way, the demise of Rajiv resulted in the end of the single party system in India’s national politics. It led to a situation where regional parties started to revolve around two main political heavyweights – UPA and NDA. It exists even today.

The void that was created in the summer of ‘91 still hurts the Congress, which is today busy working towards strengthening its image amidst scams and incidents of corruption. Also to blame is the party’s weak structures in states such as UP, Bihar and MP, which account for a total of 179 seats in the Lok Sabha (33% of total), and its increased dependence on regional parties in recent years. Politically therefore, Rajiv’s absence has affected the Congress party adversely.

But are we forgetting that there is perhaps another Rajiv in the making? Rahul could be the new Rajiv. There are questions being asked about whether circumstances favour the party’s crown prince the way they favoured his predecessors. But Rahul doesn’t seem to care about the odds. For years now we have had political pundits talk about the charisma of the Nehru-Gandhi dynasty and how it could help revive the Congress party as it faces a political onslaught from entrenched regional parties, an aggressive right wing and ever more vigilant civil society groups. Perhaps Rahul is the hope who can fill some of the void that was created in the Congress bench after Rajiv was gone Many claim the junior Gandhi is yet to prove his mettle. But does Rahul care? He is charismatic, young, widely talked about, and has just about crossed over to the wiser side of 40 – characteristics that we associated with Rajiv in the years that preceded his ascension to the PM’s office (in 1984). Yes, he still has to embed into civil society his clear intent to demolish corruption, a factor that will play a huge role in the 2014 Lok Sabha elections. But perhaps, it is Rahul who could enable Congress to form a non-coalition government in the years to come. There have been disappointing consequences of the assassination. But the rise of Rahul in 21st century Indian politics may prove to be the all important upshot of that incident.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

BBA Management Education

Monday, May 06, 2013

Needed cash to reduce its interest costs

With the recent Diageo deal, the UB group has got some much needed cash to reduce its interest costs. But as major group companies continue to struggle with unfathomable debt loads, the only freely flowing commodity is advice!

It seems sensible to infuse the cash back into the flagship company. Outside of the deal with Diageo, though, United Spirits has few other deleveraging options; such as selling shares worth around Rs.4 billion in its sister concern United Breweries, besides offloading stake in Bangalore Royal Challengers, its IPL team. In an attempt to unlock the value of its non-core assets, the group is said to be mulling over a proposal by private equity fund Blackstone to buy out the prime office, retail & real estate blocks in its flagship UB City for Rs.5.5 billion (at the time of this issue going to print). Over the last one year, the group’s other major business has also turned loss making. Mangalore Chemicals and Fertilizers, which earned a net profit of Rs.29.7 billion for Q1, FY 2011-12, posted a net loss of $12.49 billion for the corresponding period this year, owing to financing costs that rose by almost 400%.

Aviation is clearly the next business to bail out of. Kingfisher Airlines’ debt position has turned from bad to worse since it acquired debt-laden low cost carrier Deccan Aviation. At the time of the deal, the combined losses of the two entities amounted to around Rs.20 billion. This became the starting point for the entire disaster. The situation turned so bad that Kingfisher Airlines has even lost its flying rights due to non-payment of various dues. Its lenders have refused to provide any further assistance unless the company gets equity infusion. Their stance got tougher after the recent announcement by their promoter. Dr.Vijay Mallya, who is known for his swanky lifestyle, said that he would infuse £50 million (around Rs.4.4 billion) into his Formula One racing team – Sahara Force India.

But seeing that Kingfisher has to be given up eventually, the question remains on how it should be valued by any acquirer. To be fair, it was a honest attempt at creating a new aviation experience and a uniquely premium airline brand for the discerning flier. However, the financial situation is a huge deterrent for any investor, even if he values the power of the Kingfisher brand. Sudip Bandopadhyay, MD & CEO, Destimony Securities, remains cautious when he says, “It is extremely difficult to put a scientific basis for a valuation of Kingfisher Airlines at this stage, since they have lost most of their rights and businesses. However, based on the strength of the brand, earlier track record and assuming that the flying rights can be gained back, we can look at a valuation around Rs.25 billion for a transaction involving controlling stake.” However, in the absence of any physical assets, flying rights and evaluation methodology the figure of Rs.25 billion also looks too good to be achieved, just in case the top management of the group plans to finally move ahead with such a stake sale. One of the major lifelines they would be looking forward to is the expected government clearance for further opening up of the aviation sector for foreign investment. If things go on as expected, this could be the best exit option for the ailing airline. However, for this to happen, Kingfisher Airlines needs to first regain its flying rights and revamp its distorted image. Brand equity has reached new lows due to the company’s persistent inability to pay salaries on time. As on November 17, employees had just started receiving their salaries for the month of May after repeatedly failed promises.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

ExecutiveMBA

Saturday, May 04, 2013

The B&E B-SCHOOL PANEL MEET 2012-13

For three years now, B&E has been coming out with its critically acclaimed annual B-school rankings, which rank the top 30 B-schools in India uniquely based on the scores given by industry leaders to the top 30 B-schools (shortlisted on the basis of rigorous primary and secondary research by ICMR) on five critical parameters – course content, industry interface, faculty research & writing, global exposure and placements & packages.

The B&E B-School Panel Meet 2012-13 focused on whether ‘entrepreneurship’ and ‘social inclusion’ should be added to the five existing parameters to rank the top 30 B-schools. While there was widespread consensus on the need to inculcate an entrepreneurial spirit, panel members also expressed concern that B-schools were creating more employees rather than entrepreneurs. Dr. M. K. Chaudhuri, Founder-Director, IIPM, commented, “To be a successful entrepreneur, some experience is essential. Only after 3-5 years experience in some product/market, I can imagine that they can innovate on a new product and look forward to almost 100% success. A placement is absolutely necessary if you want to achieve some business objective.”

In terms of social inclusion, the debate centred on whether it is really relevant to corporate strategy, and consequently, to B-school education. Prof. Arindam Chaudhuri, Editor-in-Chief, Planman Media, asserted that it was an absolute necessity and stated, “At IIPM, we propagate the philosophy of ‘survival of the weakest’, as opposed to ‘survival of the fittest’, which is how the world runs. But if you want to change the society to a more humane society, you have to focus on ‘survival of the weakest’, which is also the philosophy that we follow in our families.” He further added that if the industry could lobby for purchasing power for the bottom 80%, they would be really lobbying for 20 years of profits.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

BBA Management Education

Thursday, May 02, 2013

Why everybody at SpiceJet loves Raymond

Two years back, Neil Raymond Mills took over as SpiceJet’s new chief. Then, the airline was unwell. He began by slashing costs. Strategies that didn’t make economic sense were forgotten. Today, the airline appears a turnaround tale. Reality is, the job isn’t over yet. Worse, harsh history could repeat itself

A simple analogy. If you drive a car at a constant speed minus stops, you burn less fuel. The gains don’t become apparent after each short drive. But in a quarter of a year, the reduction in fuel consumption starts to show. The results become more pronounced in a year. Much is saved in gas and cash. Common sense. But most airlines in India ignore such small money-saving acts. SpiceJet is not one of them. At the airline, this “constant speed” philosophy is communicated as a compulsory key message to each of its newly recruited pilots. These cockpit handlers are supposed to remember it every time they leave an air strip. The idea is to get the pilots to save anywhere between 0.5% to 1% of the airline’s fuel bill. A small chunk saved. But at SpiceJet, if a cost can be avoided, it is.

Cost-cutting doesn’t always help
The company’s hardheaded emphasis on lowering costs does affect its operational efficiency metrics. Unfavourably at times. In July 2012, SpiceJet’s On-Time Performance (OTP) on domestic routes was 84.3%. That meant, about 16 of every 100 flights were delayed beyond 15 minutes. Much of this is can be blamed on the constant speed norm that is in place at the airline. This makes the airline’s record only better than the havoc-stricken Air India’s (OTP of 81.2%) and now-stripped-to-the-bone Kingfisher Airlines’ (81%). All other airlines recorded OTPs in the 90%-plus range [IndiGo: 95.3%, GoAir: 90.3%, and Jet: 91.6%]. The company isn’t one to worry about offloading passengers to peer carriers (and cancelling flights) either, when load factors don’t justify economics. The carrier strives to maintain an average load factor (LF) of over 75%, and plans to increase it over the quarters to come [in Q1, FY2012-13, LF was 80.8%]. Result: SpiceJet’s flight cancellation record (2%) is only better than those of Air India (3.2%) and Kingfisher (8.2%). Others boast of a lower figure (IndiGo: 0.1%, Jet:1.4%, GoAir: 1.6%).

Mills... a number-loving turnaround guy
But CEO Neil Mills, who has turned around the airline in the past two years, knows that these numbers only tell a part of the SpiceJet story. He is familiar with how budget airlines work. An industry veteran of over 20 years, this former CFO of Middle-Eastern LCC Flydubai knows his numbers fall on the rational side. He measures every paragraph in the book by weighing data. That is exactly how he helped build Flydubai from scratch. He plugged cost holes at the company, and improved its balance sheet, helping the airline grow from a drawing on the whiteboard to a fleet of nine operating aircraft in just a year-and-a-half. Before Flydubai, he was at easyJet for 12 long years. Under him, the company grew from 4 to 174 aircraft, and became one of the biggest, most profitable airlines in Europe.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face

Saturday, April 27, 2013

Who will be America Inc.'s new #1 in 2012?

Profits of the 2012 B&E US Power 100 brigade totalled 13.4% more than last year. If America Inc. doesn’t suffer a double-dip recessionary heartache anytime soon, next year, the profits could rise higher. The question is: where will the leaders of the pack appear next year?

Twelve months in the past, my forecasts for America Inc. would have found a different set of takers. By the time July 2011 drew to a close, America Inc.’s benchmark indices had conveniently started the journey downhill. The S&P 500 was at a 6 month low (at 1,292.28 points). And the NYSE Composite and NASDAQ Composite indices were breaking longer records (8-month lows at 7,528.39 and 2,756.38 points respectively). As for brains in the boardrooms, they were worried about their shareholders. The simmering discontent over returns from bourses around the world, troubles in Europe that were mounting every passing day, and the cloud of criticism that surrounded the painful inflammation called unemployment that had shown no signs of subsiding since playtime got over last, were all unromantic truths. Wall Street had become nervy. America’s big boys of business too had.

On-ground, the possibility of a double-dip recession had got investors into a binary mode of thinking as far as returns were concerned. Off it, polarisation in American politics – with the Democrats blaming private interests and ill-directed deregulation for leading the economy to the pit, and the Republicans finding faults in the half-measured pump-priming for the economy’s failure to climb out of it – had disturbed the balance between pragmatism and (party) principles. Then, America’s AAA credit rating was headed towards the red zone, and no single bloc – for abundance or lack of desire – had a hassle-free solution to lighten the economy’s budget woes. It wasn’t a situation that called for celebration. With American GDP growth expected to fall below the 2% mark in 2011 (after rising 0.9% and 1.3% in Q1 & Q2, 2011) and global economy forecasted to underperform the 2010 story (estimated to fall short of the 4.4% growth scripted in 2010), optimism was out of question. So was any hope of a double-digit growth in bottomlines of companies and returns for the investor clan.

I had predicted otherwise. I had not only predicted that American companies would deliver double-digit growth in profits (PAT of 2012 B&E US Power 100 companies grew 13.4% y-o-y), but also handpicked the ones who would lead the band of profit-makers.

Like I said before, twelve months in the past, my forecasts for America Inc. would have found a different set of takers. Of the 20 companies which I had forecasted would occupy the top 20 slots of America Inc.’s profit charts, 16 actually did. According to my estimates in B&E, Exxon was supposed to walk away with the crown in FY2011, followed by Chevron, Apple and Microsoft. It happened. In fact, if an investor were to bet on me and invest equal dollars on each of the aforementioned top four names that I’d claimed would emerge winners, his return in just 11 months (as on June 27, 2012) would have been 22%. [To give you an interesting example, in July 2011, when I had predicted Apple to rise to #3 amongst profit-makers in FY2011, its m-cap was $310.41 billion.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

Wednesday, April 24, 2013

The way they love hate crimes!

The recent incidences of hate crimes in US and across the world highlight the importance of promoting greater tolerance at all levels

Hate crimes have long been a part of the history of mankind. Under European colonial rule in the 16th and 17th centuries, native Americans had to undergo social discrimination. Similarly, Nazis in Germany practiced the Final Solution to execute European Jews during World War II. In the last two centuries, hate crimes against African Americans and xenophobia have become rampant in Western countries.

For all its claims of being a land of liberty and tolerance, US boasts of some fairly unimpressive statistics. The FBI recorded the number of criminal incidents with a biased motivation from 2000 to 2008 from 14422 law enforcement agencies representing 278 million people. In all, it noted 777 incidents that were linked to ethnicity/national origin (1109 victims) and 1,303 incidents linked to religion (1575 victims). The recent brutal murder of an Iraqi-American woman Shaima Alawadi in San Diego (on March 24, 2012) and the shoot-out of an unarmed Black teenager Trayvon Martin in Florida (on February 26, 2012), have highlighted the increase in crimes against minorities like Muslims, Black, ethnic Jews & Latinos.

In particular, America has witnessed a surge in the number of hate crimes against Muslims post 9/11. A report by the Journal of Applied Social Psychology explored that the number of anti-Muslim attacks in America in 2001 increased exponentially from 354 to 1501 following the attack. But the crimes were not limited to Muslims only. Other minorities were on target as well. As per the FBI’s recent Hate Crime Statistics, around 6,628 criminal incidents involving 7,699 offenses were reported in 2010. Along with Islamophobia, anti-Latino crimes have also increased manifold. A study conducted by Pew Research revealed that in 2003, there were 426 hate crimes against Latinos, while in 2007, there were 595 nationally. Hate crimes have also surged immensely in Canada. Canadian police services reported 1,401 hate crimes in 2010, which boils down to a rate of 4.1 hate crimes per 100,000 people.

Unfortunately, the trend in hate crimes, especially Islamophobia, is spreading like wildfire in Europe as well. According to the French Muslim umbrella group, French Council of the Muslim Faith (CFCM), hate crimes against Muslims rose by 20% in the first nine months of 2011 in France. A record 15,284 people were prosecuted for hate crimes in England and Wales in 2010-11. However, the official data revealed by governments may be much lower than the actual figures on the ground, as research has found that many victims of hate crimes are often reluctant to come forward. The research further revealed that only one-third of the police reports were filed by the victims, while many incidents went unreported and were also swept under the carpet.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

Saturday, April 20, 2013

International

HP’s bad run not over

The personal computer industry continues to struggle with consumers showing strong preference for i-Phones and i-Pads. Not surprising then that Hewlett-Packard, amongst the world’s biggest computer makers, is faced with its own challenges. Investor confidence in the company continues to tumble and the company’s present market cap has tanked to about $54 billion as compared to almost $104 billion a year ago. For the quarter ended January 31, HP’s profit dropped by 44% while revenue fell 7%. To make matters worse, the company’s forecast says it is up against weaker-than-expected results for the quarter ending April 31. Overall, HP posted fiscal first quarter net income of $1.5 billion, or 73 cents a share, compared with $2.6 billion, or $1.17 a share, a year ago. Revenue declined to $30 billion from $32.3 billion in the same period. Analysts say that the company’s supply chain is in a complete mess. Floods in Thailand have also hurt it badly. However, the company’s co-chief executive Meg Whitman is hopeful that her plans for cost cutting, investing more in areas such as online cloud computing, security, and tools that help businesses manage data, will help HP win back lost ground. Various analysts have also recommended investors to stay invested in the company for the long run. But to win back investors’ confidence, HP will have to try harder and race against time to make itself healthy again.

Apple hints at paying out dividend

Apple’s CEO Tim Cook has given hints that the company with about a $100 billion in cash may at last give in to its investors’ wishes and pay a special dividend. Under the regime of its legendary ex-CEO Steve Jobs, the company maintained a policy of not paying dividends and conserving cash for the purpose of reinvestment. The last time that the company paid dividend was in October 1995. However, this time around, though many are in favour of the company paying dividend, some investors are divided in their opinion about the type of dividend to be paid and even whether it should be given. Despite the uproar that Apple should spend its cash, the tech giant is not the only one sitting on a cash pile. Google and EMC, for example, are among the handful of big names eschewing dividend payment. At the other end of the scale, companies like IBM and HP are regular dividend payers, while Microsoft made its first payment in 2003, and Cisco announced its first-ever cash dividend last year.

Read more.....

Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles