Monday, July 31, 2006

Your flight is preponed

As I awaited the SMS from Air Deccan on D-day, I was shocked and surprised. My flight was preponed. I could barely control my laughter, but they meant it. Throughout the day that was the time they said my flight would leave at. But at 8.45, the 9.40 flight preponed to 9.15, was rescheduled to 9.45.

I thought that this was a unique case, but the same happened on my return journey too. The 11.30 flight was preponed to 11.15 and finally took off at 11.30.

Smart move me thinks. Get the people in early, take off on time - it may actually end up benefiting Deccans tough times with punctuality.

But, here an observation based out of our family members observations (Brownie points to SIL). Fly Air Deccan on days other than Fridays and weekends. I have my doubts on Monday too. But if its Tue, Wed, Thu - it is the airline to take. The days Deccan has its capacity filled (weekends, vacations, surrounding days) its schedules go haywire.

Thursday, July 27, 2006

Deccan is now mainstream

Air Deccan is now mainstream. The low cost airline is second in terms of market share, second to Jet Airways and has pipped Indian (Airlines) to the second post. (As you would see from the link there is some confusion over the exact percentage - but when it comes to controversies over the third decimal of the percentage - you know who is winning).

I had my first Air Deccan experience recently. Their service is quick and pretty good though they have to scale up in terms of punctuality. Most people I know await the Deccan SMS, which very promptly announces any kind of delays in service. The SMS is a very good thing, but ironically because of Deccans constant rescheduling by an hour or so, it is "dreaded".

They have recently stopped issuing seat numbers on boarding passes. Knowing India, this is a pathetic move. Now like in bus stations, you will find people leave vegetables, kerchiefs and briefcases to "claim" seats. At best, they should automate the numbers and leave passengers with no choice while boarding. Perhaps this speeds up the issue of boarding passes and it does, but leaving it to free seating makes it a "grab a seat however" game.

The other interesting thing I noticed was while I waited for my flight. Prior to my flight, it was Jet and KF and once their flights left, the airport had only an Air Deccan flight to go. The difference profile of passengers is discernible; Air Deccan is slowly making flying more and more accessible and opening the market up. Much like the cellphone service providers. Now, if only we could do that in education too...

Tuesday, July 25, 2006

Dangerous ideas...

I have seen autorickshaw drivers in Hyderabad use a dangerous idea (in my opinion) for braking their vehicles. They had got the brake cables removed from the handlebar. Instead they had connected it to some point on the right outer body of the autorickshaw. Therefore to stop the rickshaw, they have to press the cable using their right hand instead of having to press the brake on the handlebar. I am not sure why they do this. In Hyderbad I thought they did this because many rickshaws seat a person on the left side of the driver, so it gave them room perhaps. I saw one in Bangalore the other day, where rickshaws typically seat only three (as per law). Perhaps the control from handle becomes loose with use and there is too much play and to repair this, it takes them time and effort. By keeping the cable separate, they can pretty much do it themselves. This idea classifies as jugaad in all senses of the word.

But to me it spells danger since using a cable is like using a rope, you have no real way of estimating the precise force required to come to a sudden halt or in stop go traffic - which would be taken care of by adjusting the brake cable via the handlebar.

There are quite a few shortcuts we (people) use. Electricians and carpenters use live wires supported by matchsticks or equivalents to plug their tools into sockets. Welders often use no protection (they simply look the other way) for their eyes.

This is especially rampant on the roads. In Bangalore people drive the opposite way on roads to save a few meters driving or back up into main traffic on main roads when getting out of certain parking locations. How can we get people to adhere to some basic rules on safety. They endanger not only themselves but others around them...

Monday, July 24, 2006

Talk on creativity - Sir Ken Robinson

This is a rather late link to the presentation at TED talks by Sir Ken Robinson which I got from Presentation Zen. It is an amazing presentation in itself and I found myself listening to the talk more than once in the last few days.

Sir Ken talks about creativity, education, creativity in education, the recognition of multiple intelligences - the sameness of the educational systems all over the world (this would quite a surprise to those who hammer only the education system in India). He talks about today, even without a degree, people can get jobs and do well in life. But really, what I say does little justice to the video, so do take a look at the video.

In ancient India, there used to exist gurukuls which taught only dance, only music, martial arts, the vedic chants and so on. In the olden days we had a different educational "system". We actually have small remnants of the same even today. Perhaps Nrityagram is an example, perhaps some vedic schools are examples. I am sure there are many others, but I dont know of too many of them.

Perhaps, as a nation to use Sir Kens words, we have educated ourselves out of creativity.

Sunday, July 23, 2006

Food and oil

Got this link via Marginal Revolution and I think the author raises some pertinent points about how food is "dripping with oil". The article is quite eye opening despite being quite pessimistic in nature and a few flaws. Do read it if you have the patience, but for those with an interest in sustainable living and how we live in these days, it is quite a revelation about the energy that we use up in growing food.

Comparing to the state of the agriculture in the US and in India, here is another thing in which we can leapfrog over developed nations by slowly but surely moving towards "organic" agriculture...

Friday, July 21, 2006

Smart and dumb cooker

It started off as a comment at Perspective, but I think a full post is justifiable here. Prestige of TTK had launched a cooker by the name of Smart some time back. The cooker had some sort of unique design of a switch on the lid for the steam and that was part of the trouble. Our "Smart" cooker gave us enough trouble and last week we exchanged it for another cooker, for which we got a nominal amount back.

The question is, how do companies treat a "failed" product like this? In India recalls are far and few in between. So, while the Smart cooker seemed like a smart idea, it was a total failure in the kitchens - and it was not due to mishandling. Either the switch gave way or the ring or something else. While, we are all for innovation, we would really expect that the company compensate customers who have bought into their "innovation" and tested and pronounced the failure of the product. The company on its part has discontinued the production of the "Smart" cooker for now.

Retail - the coming battle 2

As the biggies move into the retail space, there are battles to be fought and won at various levels.

A large format store needs to change the mindset of the customer - she has to go to a place some distance away and shop in bulk. That is not the "current" way of shopping in India. The current shopping method (especially groceries) in India is to pick up stuff on a JIT basis or on the way back from work or elsewhere. Today the kirana affords her the luxury of both home delivery and zero planning (if need be). The only persons who will go that way are those who own cars (well, you can use a bike...). Otherwise, these stores are places you visit, but necessarily buy anything or buy something small since you cannot carry it back easily on public transport. Having said that, the market size of "car grocery shoppers" is pretty big as big bazaar has discovered.

So, while, a "Walmart" may find the going easy at the level of the consumer who is used to going out and shopping for a month or so, it may not find these local victories so easy, especially with low margin stores like Subhiksha that do not really seek to change the mindset of the Indian consumer.

I believe, that the player to be watched in this space is Reliance. They have got the whos who of Indian industry and it will be interesting to see if these strategists have got the mind of the Indian customer right. I am pretty sure, that a Walmart Americanised model will not work in India. The Big Bazaar, the Walmart of India, if I may, has an interesting model, but it is closer to the American "drive and shop" model. With parking space and crowds both being a big issue at most Big Bazaars - we need to see what new entrants learn from these shops.

Apparently Reliance will have a mix of large format stores and small stores (I read that somewhere, cannot recall where) - now that is interesting. Its first tie up (acquisition) with Sahakari Bhandar (aha, nostalgia) in suburban Mumbai seems to have given it encouraging results.

There are many other fragmented segments - which may or may not be worth tapping. Buying in bulk saves money - so you order in bulk. For instance you can buy 25 kg of rice at 20 rupees instead of buying 5 kg for 23. Or sugar for that matter. Or even wheat. This used to be in vogue in certain areas. I remember lorries unloading 50 kg rice sacks for quite a few households in Mumbai. (Delivery used to be free if a few people ordered together). The Roshan Punjabi Atta delivery model is another example. You called up and they delivered atta in a bright coloured Bajaj tempo at your doorstep. Indeed Big Bazaar as well as Subhiksha offer "free home delivery" - which is a good idea for "non-car" shoppers. "Free home delivery" is something the consumer is used to in an Indian groceries context and getting totally rid of that will be tough. So what will Reliance come up with? Somebody who will take your take your order from the kirana down the road and pick stock from the store and deliver it home? This is my speculation, but why not?

Thursday, July 20, 2006

Sahakari Bhandar

I was busy with the second part of the coming battle in retail when I chanced upon Reliance Industries tie up with Sahakari Bhandar. Sahakari Bhandar, was, in many ways the pioneer of self service stores in Bombay. Then, there were very few self service stores. Therefore a visit to the Sahakari Bhandar was some sort of an event. For my parents, Sahakari Bhandar was where they got a few rupees discount (they had a lower margin of profit). For me, as a child, it was immense fun walking through aisles of products that you could touch and feel. It usually involved me holding up a brightly coloured packet of something and my mom sternly scolding me "Leave it there" and buying all the uninteresting items - dal, kabuli chana and sugar. But it was still worth it, getting a little lost in the aisles and doing my own browsing thing.

There were a few me too stores like Sahakari Bhandar - Apna Bazaar, Apka Bhandaar and so on, but I digress. Some of these Bhandars had a self service section and a regular section where you could ask the attendant for items. If I recall correctly, this was more for high value items and items that could be pilfered easily. Those days there was no bar code nor electronic surveillance. They used a simple method. All exits had a sales counter and there was no exit without a sales counter.

I am not sure how they are doing these days, but Reliance Industries has sensed its potential and has soft launched their retail venture through these Sahakari Bhandars.

The funny thing about the ban...

...is that it lets me "post" on my blog, but I cannot view my blog (on the original website, I mean).

Why? Because the site where I post is blogger.com and not blogspot.com, which is banned!

Wednesday, July 19, 2006

Retail - the coming battle 1

The war for retailing muscle in India is hotting up. While preventing the biggies from abroad to enter, this is seen as a time to create/consolidate their own standings by the new/existing entrants, before the biggies finally make their entry.

I believe, retailing will be the next big thing in India - if we go by Reliances usual strategy of scale - though I think a one size fits all model wont work. Reliances refinery, telecom and perhaps in retail will be a case study in the years to come, but for now, I see interesting challenges for new entrants in the retail space in India.

Today, the retail space in India is fractious in the size and shape of shops. There are the neighbourhood kirana stores which are as much about convenience as much as they are about leakages in the tax system. There are also neighbourhood kirana stores masquerading as supermarket stores - basically self service stores- that use "in house branding" to protect their margins. Then there are the slightly older supermarket stores like Foodworld. Newer entrants like Big Bazaar have successfully penetrated the existing market, even with their limited stores - indicating that the market is ready for big ticket retail. But even as Reliance makes its plans, there are several smaller players like Subhiksha - who are adopting a different strategy and which is why this space will be quite interesting for the next few years during which a shake-out is imminent.

Also in this space is ITC with its rural malls and many others with their micro distribution models. Each of these above models have their own advantages and the newer entrants will have to fight each of these battles at their levels. Let the games begin...

Monday, July 17, 2006

Broadband and computers

As I called up Airtel (my broadband service provider) for yet another issue, it turned out, as it has more than once previously, that the issue was with my machine and not with their service. Airtel has perhaps one of the most efficient broadband service in Bangalore and their service engineers are good. They nail the problem pretty quickly and when it comes to replacing modems - they do it without cribs.

I was talking to this engineer yesterday and I realised that rather than go to my computer vendor, I would rather that Airtels service engineers fix any problem on my machine. I think that Airtel can spin off their service as a separate venture and while fixing issues on their broadband, also offer to fix home PC's - for a fee of course. Currently, the home PC service market is serviced by fly-by-night vendors, fake components among other things. Perhaps this is a market opportunity for all broadband service providers. Like all proverbial markets, it is not an easy market to service, but if they can figure out how, it may well lead to something.

Sunday, July 16, 2006

Is the customer a fool?

Recently my friend placed an order with Domino's pizza - a home delivery order. According to their scheme they have 3 coke free with every large pizza (or likewise). So for an order of 4 large pizzas the team should have received 12 cokes. One they received 11. As if they couldnt count. Two, the bill is as complicated as it can get. First they subtract each coke against each pizza, then they add it back at the end. In this case, they subtracted 12, but added back only 11...my friend spotted it and pretty much 'snatched' a coke, but this is not the first time.

On numerous occassions with both Pizza Hut and Dominoes, I have found that the delivery person says, "Oh, I am sorry, I forgot to get 3 cokes (usually a small number)". Since its a large order, typically we tend to forget, but when I saw this particular bill it set me thinking. Is there some small scam going on? Or is it that some establishments take customers for granted. I have seen that double checking the bill in some restaurants usually leads to some thing extra that has been charged for for either something we did not order or something we cancelled the order for.

Why?

Thursday, July 13, 2006

The Reliance effect

I got the Newsweek link on Mukesh Ambani from Deesha.org. You can read either the former link for the entire piece or go to Atanus blog for a perfect summary. Theres a Mukesh Ambani interview too at Newsweek.

But heres what he is upto.

1) Build cities - yes you read right, build cities.
2) Build retail stores
3) Build farm supply hubs

Theres another nugget in the article on bio fuels:

Ambani's farm, retail and energy visions merge at his Life Sciences Center in Mumbai, which is pursuing his "second green revolution." Founded in 2002, its research includes experiments in growing biofuels from the jatropha plant and cellulose on a commercial scale. "If you can crack the cellulose code just like the Da Vinci code, cellulose and jatropha could give us two agro-routes to a world without gasoline," he says. About half of Indian homes have no electricity, and Ambani says big companies have no workable plan to bring it to them (an indirect slap at Anil's Reliance Energy). His answer is to go "wireless." He now has teams setting up experimental biomass generators in remote villages, and envisions a day when thousands of villages have these generators—sold and serviced by Reliance's rural retail network.

And I like the way Atanu has summarized it in the end, which to me, is the tenet of capitalism and I cannot say it in any better words myself.

But the question we need to ask is this: is it better that the land gets utilized and wealth created, and even though some of that immense wealth will go to enhance the Ambani fortunes, than the alternative where the land sits around doing precisely nothing and millions of people don’t get to lead a better life? I think the answer is a no-brainer (unless of course the answer is from a no-brainer communist), “Yes, better that someone creates wealth and takes a chunk of it if it means that lots of people will also grow rich, than the alternative.”

There have also been news that Reliance is considering building a university, a cargo airline for itself and a TV news channel apart from the above.

More than doing these things, I believe that the man encourages Indians to dream and think big. Like his dad, who pretty much "created" the primary equity market, Mukesh is perhaps inspiring a lot of Indians to dream big...

Wednesday, July 12, 2006

Mumbai - the day after

A day after yesterdays dastardly cowardly terror attack on suburban trains, the newspapers carry the same inane headlines. They were an attempt at disturbing communal harmony, Mumbai has a human resilient side and blah. Mumbai is my favourite city, having spent all but my last few years there and it hurts to see the city (and country) being shortchanged and sold out to terror like this.

The Prime Minister has vowed that the fight against terror will continue and we will win. I do not see any signs of a fight - I havent seen any sign of a fight against terror in India except one that is reactive. Statements are read out by politicians behind bulletproof screens to television cameras. I do not see how we will win as we keep losing hard working citizens who were going home after they daily work or citizens who show up at temples to pray or at markets to shop. We seem to be cowering in fright. This is not the first time Mumbai has been targetted and this wont be the last. Nay, there will be yet more attacks in more cities across the country and we will get to hear more "statements on fighting terror" and very little real action.

The way we are trying to eliminate the terror tree is by cutting one leaf after another. We will never win unless we cut the tree and pry away its roots. We know who they are, but we will arrange more buses and make our borders to the west and east ever more porous. The warning signs of such an attack was always there, but then you, know, we are Indians, in the guise of self restraint, our leaders, are, perhaps, really spineless.

If this doesnt spur us into action, perhaps nothing will...

Update: A brilliant piece by Saisuresh Sivaswamy - do read it

IT SEZ is a real estate charade

Says S Sriniwasan in the Economic Times. He has dissected the IT SEZ charade beautifully....

In simple terms, the SEZ policy essentially exempts the developer of the SEZ from taxes. It also exempts the occupier of the property from taxes on exports. Both the developer and the occupier enjoy the tax break for over 15 years starting from 100% exemption and progressively going down in blocks of five years.

To elaborate, the developer has tax exempt-profits on development of the IT park and thereafter the rental income he receives from the occupier for 15 Years! The large slurp that you hear is the chorus from real estate developers and real estate investors!

So, every Ramu wants to set up an SEZ even on his 600 sq ft plot. (I am not sure if the land size is a factor, it was) I exaggerate, but you get the picture. Every real estate developer wants a share of this pie. Then he goes to say how the SEZ policy is biased towards the big companies.

Since large IT companies like Infosys get the SEZ status for their campus they will not be affected. Commercial interest will ensure that other SEZ developers (read real estate players) will prefer the big IT companies and MNCs as tenants.

It’s the smaller companies who will pay the price since they will be denied the present STP policy benefits and would also be on the last priority of SEZ developers to rent out space.

Theres more juice. Nasscom is trying to retain the STPI scheme so that smaller firms get to benefit.

Where is the real estate charade in this? Well, development profits of residential and other commercial space (retail, etc) are also exempt from tax in an SEZ! So in a 50-acre SEZ the “non-processing area” which is 60% of the space for other uses is also tax free!

So, even if my SEZ area is 600 sq ft, I can use 60% of the area tax free. And here salaried individuals are suffering under surcharges, cess, tough to fill firms and investigations and the like while poor real estate developers and poor IT companies and captives get to pay zero tax. I think I must float my own firm. Neelakantan Inc.

The government is now thinking of limiting the number of SEZ to about 150 odd, i.e., those who stood first in the queue! This will further skew the supply, result in profiteering by the few who get the SEZ approval and adversely affect a large number of IT companies.

Licence raj, welcome back.

My twenty five paise on the SEZ is that, SEZs need to be used for attracting fresh industry and investment and infrastructure. The policy has got it all wrong, if it is used by people to shift out of their current locations and move into new SEZ locations. This is like the erstwhile sales tax arbitrage on trucks registered in the North East. Suddenly there were a lot of Nagaland registered trucks in Mumbai - it was worth driving down all that distance and still save money. Similarly there were a lot of Dadra, Nagar Haveli registered cars in Mumbai until that loophole was plugged.

SEZ's should be used to augment infrastructure, create manufacturing or a technology capability. It is no use if we have coaching classes set up SEZ's.

Tuesday, July 11, 2006

Organic food - some questions

Organic is the word to use if you are in with the food tastes of the times.

The Wikipedia entry has this to say on Organic food...
"Organic food is, in general, food produced without the use of artificial pesticides, synthetic fertilizers and in many definitions genetically modified organisms (GMOs). Farms that grow organically, often do so in a sustainable, environmentally sound, manner, and more often than not, are small family-run farms. These qualities of organic farming, among others, are in stark contrast to the more common industrial farm."

It also goes on to say, Organic food may be fresh or processed. Read the entry for some nice gyan on organic food.

For fresh food, "organic" usually means produced without extensive use of synthetic chemicals (eg: fertilizers, pesticides, antibiotics, hormones), in the USA substantially free of genetically modified organisms, and often, but not necessarily, locally grown.

Processed organic food usually contains only (or at least a certain specified percentage of) organic ingredients and no artificial food additives, and is often processed with fewer artificial methods, materials and conditions (eg: no chemical ripening, no food irradiation).

One question I have is why is organic food more expensive than regular food? Indeed it should be cheaper, considering it is usually less processed, uses lower inputs - so why the premium? The wiki entry says that it is because "farmers who grow organic food have to meet stricter quality standards to have their products certified organic. More labor is required to achieve this, bringing up the cost." That is interesting since in India farms arent greatly mechanised neither is there an Indian quality standard on organic food, unless we adopt European or other standards.

Perhaps organic should also be local, as this post says, among other things...

Monday, July 10, 2006

Retail - Subhiksha widens footprint

Even as Reliance, the Goliath in waiting draws up plans of a massive entry into retail, there are some players who are creating their own markets. In the area that I live in Bangalore, a new Subhiksha a low margin retail format store has opened.

They are positioned as your neighbourhood kirana store with self service and home delivery options - that offers low(er) prices. The interesting thing is that everything in their store, and I mean everything is sold for below the MRP. This is how the kiranas have always done their business - so this about taking their war to them. Subhiksha also has discount pharma and a vegetable and fruits outlet.

When they launched in the area near us, assuming this is how they launch elsewhere, they made a small but significant splash. Door to distribution of membership cards, using the discount pharma (10% off MRP on everything, unlike your friendly neighbourhood pharmacist who charges "Local taxes extra" on the MRP) to attract customers to the other two (groceries and convenience store). With their home delivery option, in time, they may well cause a significant shift from the kirana.

Subhiksha still not have the reach (in terms of number of stores) or the width (they cannot stock as many different items as the local kirana guys) and are also quite constrained by the weights and measures (they sell their stuff packed, so you cant buy 250 grams of something if their package is half a kilo) - but within these constraints, they are a force to reckon with. Today, I would prefer to go to a retailer who bills me (and therefore I hope pays taxes) and someone who gives me more value for money. Therefore, if the impact is severe enough, kiranas may move away from some of the brands and move into the "loose" "niche" space.

Friday, July 07, 2006

India shining or not

...not is what an op-ed in NYT (link from Abi) by Pankaj Mishra (yes, the person behind this) says. It is also what some sitting in airconditioned rooms with unlimited broadband sitting in this half of the world writing about the other half peering through tinted glass windows would like to have us believe. Titled "The Myth of the New India", here are some excerps...

There is, however, no denying many Indians their conviction that the 21st century will be the Indian Century just as the 20th was American. The exuberant self-confidence of a tiny Indian elite now increasingly infects the news media and foreign policy establishment in the United States.

Well, the confidence is justifiable. In terms of the technology outsourcing work, we are doing pretty well. Facts and figures from the Nasscom site:

  • The total direct employment in the Indian IT-ITES sector is estimated to have grown by over a million, from 284,000 in FY 1999-2000 to a projected 1,287,000 in the current fiscal (2005-06)
  • In addition to the nearly 1.3 million-strong workforce employed directly in the industry, Indian IT-ITES is estimated to have helped create an additional 3 million job opportunities through indirect and induced employment. Indirect employment includes expenditure on vendors including telecom, power, construction, facility management, IT, transportation, catering and other services. Induced employment is driven by consumption expenditure of employees on food, clothing, utilities, recreation, health and other services.
Just taking these figures at face value, thats 4 million (40 lakh) jobs created, which did not exist before.

It was not so long ago that India appeared in the American press as a poor, backward and often violent nation, saddled with an inefficient bureaucracy and, though officially nonaligned, friendly to the Soviet Union. Suddenly the country seems to be not only a "roaring capitalist success story" but also, according to Foreign Affairs, an "emerging strategic partner of the United States." To what extent is this wishful thinking rather than an accurate estimate of India's strengths?

Suddenly? The change has taken us about 15 years and we are getting there, though slowly. Strategic partner of the US notwithstanding, today, we as a nation are far more self sufficient, industrially better off than we ever were. We have progressed, though there is lot more we need to do. We have one of the fastest growing mobile phone markets, one of the largest pool of engineers and work is steadily flowing into India.

Yes, there are farmers who commit suicide, children who are malnourished in our country - these problems have to be addressed, it wont happen if the country does not progress. After all we have to clear the muck left over after almost 50 years of failed socialism, a hundred odd years of British occupation. There are also a bunch of beyond-expiry-date politicians who are trying their best to turn the clock back. We also have leftists, corruption, communists and terrorists (verbal and others) who are trying their best in their own way to see to it that India remains retarded, ignorant and illiterate.

Progress is about where you look. In India you can see the gutter as much as you can see telephone towers. If you chose to see the gutter like Pankaj Mishra does, you will find muck. But if you see the telephone towers and see how many in the gutter are trying to get out (and are getting out), you could choose to be optimistic and confident...

Thursday, July 06, 2006

The one year bug

A year into their job, aspirants seek to more qualifications to their resume to gain that "edge". Correspondence courses, distance learning courses are the ones they usually pick. Very few of them get completed. The one year bug afflicts everybody...

A year into their job, employees feel inadequate and decide to collect a post graduation degree or certification or diploma by hook or crook (or correspondence). After all, a job is a job is a job and one cannot expect a promotion within a few months, but for the new entrant, without a quick promotion the job seems dead end. And he tries to add "value" to his resume in an effort to search for a new job.

At this point many of the engineers who had "decided" to stay on in engineering as a career decide to "try for" CAT. For many of the MBAs, it is the time when they think if they should acquire a law degree or a CFA. Techies try to get themselves certified in as many courses as possible. In organizations where training is available, they try and attend as many trainings as possible and put it on their CVs. CAs think of acquiring a costing degree or a CFA degree.

Applications are sent to ICFAI, CS and other universities - which I think (based on anecdotal evidence) rank in decreasing order of the number of dropouts. The common theme is "Let me invest some money in this course, therefore I will study". The investment happens, but study doesn't.

As a nation, we have trivialised the value of a degree. We hire graduates (and find them, since there is a perennial paucity of jobs) for positions that require little or no intelligence. We hire post graduates, engineers and MBAs where any qualification, really, would do. Therefore, everybody is running after a degree, because there is simply no other option. If you dont have a degree you stand to lose out not only in the job market, but also in the marriage market, therefore collecting degrees is our hobby.

Alternate careers were a strict no-no until recently for various reasons (employment) and for various other reasons (low paying "other"jobs). Why, many of our best cricketers have engineering degrees.

The point being, a qualification will only take you so far. Without a degree your resume wont even earn you an interview invite. There are universitites and institutions cashing in on this "apparent" need and laughing all the way to the banks. They attract a huge number of fee paying students on whom their investment is just a few printed notes and they wont even complete the course. A random survey around you of those who have completed one year at work will tell you that they are "disillusioned" and are looking for ways and means to enhance their value in the job market by adding one more qualification to their resume. The hypothetical situation they are trying to address is that, "If there are two perfectly matched resumes on which the employer has to shortlist, he will shortlist mine because I have one more qualification." Believe me, such a situation will never arise. If it does arise and you have an interviewer who decides to employ you based on such a situation, you are better off not joining that place.

Once you are in a job, in many places the education qualification doesnt matter it is only your performance in the job. (what goes unsaid is the fact that degrees matter atleast a little - a good degree is never forgotten.) So, when the first year bug bites, just let it pass. The additional value of every incremental degree or certification is very low. It does nothing. At some point it can become a talking point with your interviewer, but really little else beyond that.

On Salaries and workplaces

Rashmi points out in her blog that the hotel industry is stingy and does not pay its employees very well, definitely not in the early years. That came as somewhat of an insight to me. I was under the impression that the hotel industry is booming and like every booming industry (IT/BPO), these chaps would be paying well.

Actually, the concept that employees have to paid a decent salary is a recent thing and in part due to the IT revolution in India. I remember, post engineering, I met this chap who owns a factory somewhere in Maharashtra telling me, "I cannot pay you much, but I can offer you a job that gives you good learning." This for many years was the paradigm that our subsidy eating small scale sector or the licenced capacity monopolising private enterprises lived by. Indeed this was always the story throughout the 70s and 80s. Companies, would, as far as they could, pay the least possible and then proceed to extract the maximum juice out of the employees. After all, it is about margins too.

Ditto about offices. Offices, until recently (and there are quite a few even now) were just cubbyhole rooms with a few tables and chairs strewn about (except for the big guys cabin). No company thought they should invest in good office space to keep their employees happy - surely nobody beyond the glitzy offices in CBD Bombay.

If the hotel industry is losing out people to IT and BPO, well, thats their problem and not the problem of the IT/BPO and that last thing people should do is point fingers at them, since they are actually improving the quality of life of these graduates. Today, the number of "decent" offices is high. In one of my earlier workplaces even our office boy had a small desk he could call his own. Companies have seen that a good place attracts people to work there. And why not?

I used to wonder why architects, mining engineers join IT companies. It is because of working environment and salaries. After all, passion works only upto a certain point. You cannot fill your stomach on passion - you need money to pay your room rent, daily expenses and you need to save too.

Aha, that triggers a new thought on passion and careers and stingy misery private enterprises. Someday I will expound on that too.

Tuesday, July 04, 2006

Co branded store

Co branding is not new, but this particular co branding in a store took me by surprise. A shop in Bangalore is a twin shop for GK Vale (a well known chain of photo studios in Bangalore) and Sony (yes, the Sony). One of the GK Vale studios in Bangalore doubles up as a Sony Showroom (I believe, only cameras and related stuff) too. This store is near a perpetually jammed traffic intersection, so I have observed it only from the road, never been inside.

GK Vale is a service provider, while Sony is a product manufacturer. You can be pretty sure you wont see a GK Vale camera anytime soon nor a Sony Studio. The co branded store makes sense from Sonys perspective since GK Vale sells a range of digital cameras from all manufacturers. But if the GK Vale outlet only stocks Sony products (cameras), then its not a great situation for their customers. But I thought it was a nice new experiment.

Sunday, July 02, 2006

Correspondence and MBA

During the course of many interviews, I have come across candidates who say that they have a "correspondence MBA" and therefore they should be given weightage for it. I personally believe that, simply put, a correspondence MBA is useless. Correspondence accounting courses, technical courses and even economics courses are ok, but a correspondence MBA course, definitely not.

An MBA is not about mugging a few theories and appearing for an exam. Many students, especially the ones who go to tier II and tier III MBAs view the MBA as just another course, or as I often put it, "Advanced BCom". In many of the MBA colleges under Bombay university, professors offer tuitions (and there is demand) for some of the "tough" subjects. Whats next? "21 most expected question paper sets for MBAs"?

An MBA is not about Accounting, Costing, Marketing and Operations Research papers. It is about being able to learn concepts and applying them. So, you spend time learning these concepts in your classes and you apply them through your case studies, the projects you take up and the internship that you do during your summer months.

The other thing that a good MBA course teaches is "you are not the only one who is smart". Put in a class of 60 odd people from varied backgrounds - including ones with experience, without experience, military experience, bureaucracy experience and varied educational and social backgrounds - and what you get is a sheer intellectual buffet. In a case study, you would think you have covered all angles when a team blows you with another 30 different angles.

The MBA is also a race against time. You are expected to complete 3 or 8 different case studies within 24 hours. How do you do it? Time management, planning are things that really, cannot be taught beyond a certain point. You got to pick up skills as you go along.

It is about team work. For the individual contributor - or those who can never work in a team, it is about being able to work with a team. For the rest, it is about being able to work on your strengths or being able to reduce your weakness by trying something you have never tried. Thus, in a group case study, you would try to reduce your fear of econometrics by trying your hand in the mathematical part of the study or use some bodys econometrics skill to bolster your argument. It is essential that you do both, not just one.

A correspondence teaches you very little. It prescribes a few books and offers you some notes. Yes, it does involve committment of time, but really not as much as the other options and then again, it is devoid of interactions with other teams or professors.

Unfortunately just reading a few courses and mouthing a few jargons is simply not enough for an MBA (though you can argue that most MBAs at the end are reduced to only that).

At the end of it my simple advice. If at all, you want an MBA and you cannot take a two year full time course, look at a one year MBA or a part time MBA. Part time MBAs (that demand a fair time while you are working) are tough. I would go so far as saying, it is tougher than a regular full time course. Usually the people who enrol for a part time course or a one year executive MBA are very committed and it does make for a wonderful experience. This is what I have gathered from some of my friends who have taken/taking the 3 years part time course at IIMB.

Businessworld on Indian innovation

This weeks Businessworld is a special on Indian innovation (registration required).

Some of the products featured are the Tata Ace, Trichy police (for community policing), ITCs e-choupal (which is my personal favourite) etc. which are quite nice to read about.

My personal view on Indian innovation is that Indians are innovative with their jugaads, work arounds for everything. Rural innovation is something we have always been proud of. But our companies can be a lot more innovative. Some of it is a hangover from the earlier era of protected markets and licences, but we have seen that more competition (like we have seen in the IT/telecom/broadband sector) can spur innovation.

Perhaps all the government needs to do is open up and let more competition in. Especially in the education (which is in dire need of some reform), energy and infrastructure spaces.