The Fall of the Bear !

One of the headlines making its rounds in all newspapers worldwide is the story of the fall of Bear Stearns & Co Inc.(BSC), one of the largest Global Investment Banks and Securities trading and brokerage firms in the world. For a bank having braved several market recessions in the past, including the Great Depression of 1929, this fall comes as a shock to many.

BSC was known for its distinctive performance, and unique employees (close to 15,500 world wide! ) that it housed in its 85 year long tenure from 1923 to 2008. A two time winner of the “Most Admired Company” tag in the Fortune Magazine and the creater of one of the most widely read Market Intelligence report, the “Early look at the Market- Bear Stearns Morning View” failed to get an early view of its preciptious fall on March 16th 2008. The event is all the more shocking as it happened after a firm denial of any cash liquidity problems faced by the company and its Chairman Mr James Cayne , was found participating in a Bridge tournament just after the denial ! Barely a week since then and BSC stock went down to effectively 0! and JP Morgan bought out BSC paying a paltry $2 per share!!

A very interesting character in the rolls of BSC was Alan Greenberg, the CEO of BSC for nearly two decades begining in the late 1970s. His memos to his employees are famous world over for thier candid quality , with a tinge of humour. (It has even been published as a book for the reading pleasure of millions outside BSC ) He wrote to them about a wide array of subjects including the ever so popular topics on Cost Cutting. He is known to have been a cutting writer, and a gentleman who glided his company over the waves , the troughs and peaks. His famous methods include saving on paper clips and reusing paper. But many people also find his weird cost cutting exercises amusing and impractical , like Tying knots on rubber bands to reuse them, Licking one half of the envelope so it can be reused etc.

I will present an excerpt of this memo, dated March 13 th 1979 (Kindly note: this is Copywrighted material from the book “Memos From the Chairman” by Alan C Greenberg).

“……..it certainly looks like we have a dynamic future as long as we remember the words of the famous philosopher Haimchinkel Malintz Anainikal: “thou will do well in commerce as long as thou does not believe thine own odor is perfume’…”

That’s exactly what the Great Bear Searn & Company Inc. did!!!

A Virgin Concept in Mobile Telephony

More and more companies have realised that Innovation is the only thing that can distinguish any player in this ever increasing competitive environment. Richard Branson of Virgin Atlantic fame, has always been a forerunner in this aspect. He was on news for two reasons in the recent past. The first one for his unique experiment of flying his jet liner -for the first time-on bio fuels. This has raised many an eyebrow. Purists in the business argue, that there is nothing remarkable as far as that experiment goes, and that it was just another typical Branson trick to attract media attention. Well! that he certainly attracted. His eccentric, out of the box image has surely gone well with the media so far!

The second reason was his message on the launch of Virgin Mobile in India. Virgin announced a jaw dropping, 10 paise return back to the consumer for every 60 seconds of incoming call entertained. A unique idea atleast for the vast Indian consumer base.

The idea is clear enough. An innovative move to attract users to encourage more incoming calls to have a limit on their bill, and hence encourage more callers to subsribe to Virgin! Neat idea I must say . But before you jump over to change to Virgin connection a small analysis of your scheme would do no harm!

The service expected to be available any time this year, is expected to target the ever increasing youth consumer base (which is an estimated 400 million in India, six times the number in the US!) , and will be purely prepaid in nature. They plan to use TATAs CDMA network infrastructure .

Now for the catch. They plan to charge every subsriber 50 paise per minute for every outgoing call pulse of 60 seconds. So for every 60 seconds of call made on a Virgin -Virgin pair, Virgin stands to make 40 paise per minute, which is actually still higher than some prepaid schemes of Airtel or Vodafone, which make only 30 paise per minute! In both cases (Virgin or Airtel) the idea is to attract a larger volume of customers at the cost of lowering a revenue. But Virgin goes one step furthur by sharing that revenue with the consumer , by encouraging him to entertain an incoming call, thereby attracting a larger subscriber base, and still managing to make 10 paise per minute more than its rivals!

I remember way back in 2001 (When Mobile phones were still the gadgets of the rich!!) people carrying huge brick like phones , and paying heavily through their nose for both incoming and outgoing calls. Barely 7 years later, we are to see people actually being paid for using their phones. Now thats what I call a ‘Virgin’ concept!

Just In Time- IT Professionals

Many IT firms in Bangalore are looking at a Zero-Bench situation finally. The theory of ‘Benching’ employees was a typical IT tradition, for some years now. Companies used to recruit huge number of IT professionals in the past and keep them in the “Bench”, hoping to utilise them when newer projects will surface. But with most global banking majors across the world delaying or even cancelling contracts, the situation has changed. The Indian IT providers now feel that these very Benches that were once an important asset to capitalise on new oppurtunies, are now a disposable liability. Huge “Lay-Offs” are expected in Bangalore’s IT fraternity. Companies that used to show the door to the lowest performing 7-10% of their employees, will now hand the pink slip to the last 25-30%.

Industry experts decline to refer to this as “Downsizing”. They prefer to call this a Market dynamics driven cost cutting exercise. Quoting Mohan Lal Menon, managing director of executive search firm Sentient Consulting.

“The message is to cut everything that’s directly unlinked to revenue. The heat of the recession is already being felt among Indian providers. As a result, they are looking at all kinds of cost-cutting measures, including people-pruning,”

Productivity through right sizing is not a new thing in the Industry. I would like to draw a parrallel between this, and what happened with the Manufacturing sector, a couple of decades ago.

The Manufacturing sector, realising that productivity can be improved only through lean manufacturing, introduced the JIT (Just In Time) Inventory model. In this model no raw materials will be stocked for future use in the inventory books of any company. The raw materials will be delivered just in time when the final product needed to be manufactured. This ensured reduced cost of Inventory and hence improved manufacturing productivity.

Drawing a parrallel, I wish to replace the ‘Inventory’ of the manufacturing industry with ‘Benches’ of the IT Industry. By that logic, the only actual rationalisation of IT professionals can happen, if IT professionals were made Just In Time available when the IT company had a project in hand. This model would comprise, IT Professional vendors recruiting professionals and lending them in contract, for a huge host of IT companies, as and only when they have projects to execute. This would mean that the same professional could work for an Infosys for one particular project, and TCS for another! There will be no need for Infosys to bench employees in anticipation of projects as JIT IT professionals will always be available for contract from the vending company.

This might mean that the huge palatial campuses of IT industries will be crashed down to small offices employing only the bare minimum required, and hence saving the cost of having to maintain huge buildings and IT parks. Besides companies can do away with a host range of HR services,and employee entertainment expenses, which IT companies in Bangalore today boast of.

This is probably imminent , to stabilise Lay Off behaviours in the wake of a volatile market! For it clearly doesn’t make sense to ’stock’ employees when the going gets good, and ’scrap’ them when the going is tough!!

Do you see a Pattern?

When the art of ‘Writing’ was first being introduced in the Greek Culture, the Greek Orators decided that it was going to be the end of all intelligent thinking. They claimed that if you could write down things which you otherwise had to memorise, your brain was not going to be utilised anymore. They advised their kids not to write as writing reduced thier ability to memorise.

Much later when Bell invented the telephone, the people then declared, that this technology will prevent people from having to write letters. And they will hence be unable to appreciate the thrill and the beauty of writing. They advised their kids to not use the telephone, but to write long letters the conventional way.

When Calculators were invented people concluded that calculators will reduce the ability of the brain to calculate. Teachers and parents frowned at their kids rushing to use the calculator even for the simplest of arithmatic problems.

When the Television was becoming a household commodity, people tagged it the idiot box. Because young kids remained glued to it, and did not pertain to any physical exercise for entatainment. They advised their kids to reduce TV watching.

When Google and Wikipedia , today provide for everybody free and copius amounts of information, people say that such ease of availability of information has made young kids forget the charm of searching of information in a library. Governments (Like China) have tried to ban their people from having access to google and wikipedia because there is simply too much information, and that is dangerous. In fact one lecturer in UK has demanded that her students be banned from using Google or Wikipedia as references for their research work.

Guess what will happen when the new Google Goggles will be launched. A pair of intelligent glasses that will store information about all that you see, and when you want to find that key bunch you have lost, will automatically search and display the image of the location of your keys!

“What you dont have to remember where you left your keys? And Google Goggles will do that for you ? That will make you more lazy and indisciplined”

Do you see a pattern?

The Most Recent Man to have Discovered India- Rahul Gandhi

After his recent expedition in the ‘Discover India’ campaign, Rahul Gandhi, lashed out a dignified but powerful speech at the Lok Sabha, which was somewhat off-beat ,in an otherwise ‘conservative’ political environment.

This speech marks the culmination of his campaign which he chose to call as ‘Discover India’. A campaign where he visited Orissa starting from March 7th, 2008 and pursued his two favourite themes ‘The Tribals Bill’ and the ‘National Rural Employment Guarantee Scheme’. 12 years after both his parents visited the same place, and created the hugely traditional tribal support for Congress. After almost a decade, Rahul entered Orissa in a completely different scenario where the BJP had already made inroads and the Congress was seen to not keep up its promises.

Kalahandi in Orissa is one of the most poorest regions of India, and Rahul managed to strike a chord with the tribals in general. However, it is his speech in the Parliament that managed to take in the limelight. His very strong rhetoric, and powerful oneliners were characteristic of the young and vibrant India image that Rahul Gandhi has been talking about for quite sometime now.

Rahul Gandhi is reminiscent of his father to many people. He has an uncanny habit of appearing more people friendly than party friendly and an ability to appear less agressive and more sophisticated are some traits he might have borrowed from his father.

Whether or not Rahul Gandhi will manage to inspire youth and energy into politics, or whether he will be able to revamp the image of Indian politicians from ‘ huge , big bellied corrupt individuals’ to the ‘ young educated dignified individuals’ , time can only tell!

Athithi Devo Bhava

At a casual dinner table discussion with some of my Spanish colleagues, I was impressed in the way they spoke of tourism in Spain, as a major contributor for their annual GDP. Quite understandable from any Indian’s point of veiw.(Don’t many of us fantasise of that golden honeymoon at Spain!) What is interesting is that the seriousness with which many tourist dominated countries , look at their tourist guests from other part of the world. This seriousness is a result of a very candid understanding of the nature of the business itself. Tourism in that sense is slightly different from that of other service businesses. Tourism is not just about making available “places” for people to visit, its about making a tourist feel like a king. Its about the people who make him feel that way.

As I get down from my bus at Bangalore KBS at 4 AM , returning from my trip to Vijayawada, I am greeted by a flurry of Auto Rickshaw drivers (the capital ‘A’ is out of respect), waiting at the door of my bus, compelling me to accept thier services, often quoting favourable phrases like “pre-paid” “meter only” etc. I dont feel like a king waiting to be served by a million Auto Rickshaw drivers.I feel like a guinea pig, waiting to get experimented on by smart, sinister cunning Auto Rickshaw drivers, and only count the seconds before I fall prey to the devious plans of somebody waiting to cheat me. If this is the way touting makes me feel, I cant imagine how abused a tourist from a distant country is bound to feel. Surely not like a king at all!

Touting leaves a bad taste on everyone. I hope somebody understands this. I understand the competition to catch the unknowing tourist from a foreign country (read as white skinned idiot!) I realise that the taxi drivers in the Airport, Railway station or the tourist guides in front of the Taj Mahal or Charminar or the beggars in MG Road are all waiting to make some business. But little do they realise that touting may make them money in the short run, but in the long run they are themselves burning their own business. The disturbed tourist is not likely to speak well of the Charminar or MG Road, to his friends back home. The chances that he chooses India for his next holiday,is that much reduced.

India has a huge possibility of a much increased tourist revenue. But that can be possible only if a few things are to be taken in serious interest by all of us.The most important of all those things is to respect and recognise tourist as a guest. Tourists come to India because they think of it as the land which has welcomed millions of cultures open heartedly. We need to appreciate the cultures of our guests , and demonstrate our open heartedness towards guests. We cannot afford to depict a closed mind towards tourists.

The government and the private sectors have already identified tourism as an important avenue for revenue. A lot of investment is already underway to realise this hidden potential of ‘ Incredible India’. But all these investments will only make better places for tourists to visit and enjoy. What is more important is that we as Indians make ourselves better people to meet and get to know.

As a closing note I want to tell you about a Swedish passenger , with whom I travelled once. He was 52 years of age! After he realised I was an Indian, he struck into a very incredible conversation with me. He said that he loved India and he loved Indians. He said that he saved money working for 10 months a year (without any leave) and then travelled to a village in North Rajastan to spend the remaining 2 months of his year! He looked like a satisfied tourist. He didn’t come to the Taj Mahal, or the Charminar to see India. He straight went to a remote village in the North of Rajasthan to meet the Indians he loved. The Indians who open heartedly allowed him into their village and made him feel like a part of the family! Made him feel good about having to come here every year. I am sure , we city dwellers have an important lesson to learn from those villagers in North Rajastan. A lesson India is supposed to have taught the rest of the world from long long ago. The lesson is simple. ‘Athithi Devo Bhava’ .

The Railway Dream!

The Indian Railways has come a long way! From being content of being referred to by every Quiz Master , as the largest employer in the world, today it stands at the brink of occupying the slot as the No: 1 Railway company in the world.

The inimitable Lalu Prasad Yadav, Minister for Railways, has proven to be (of all things!) a fine businessman. He quips in his rather non-chalant style, hitting out at the NDA Government for not even being able to pay the Rs 2473 Crores dividend, while in his term the same company has made a whopping surplus of more that Rs 1,00,000 Crores. He proudly declares, “We are not dependent on the Finance Ministry or the Government for any money! We have our own resources.”

A truly commendable job one must admit. Hats off to Lalu and whoever else is behind this successful parade. The increased realisation of revenues through increased movement of goods traffic, introduction of easier ticketing services, introduction of “Rail Neer” and many other similar innovative initiatives has really paid off!

But we still have a long way to go! I recall the agony, that I have had to go through every time a ticketless traveller bullies his way through to my seat. In my opinion , Lalu will have to address this one very important setback, that can be a big bottleneck,in the furthur growth of the railways- Ticketless travelling.

I have personally encountered hordes and hordes of ticketless travellers, making their way to their daily routine, (to office mainly) using the Indian Railways free-of-cost! The Mumbai Suburban Rail System, Surat- Mumbai Lines, Bhopal-Itarsi Lines are some of the places where ticketless travelling is a daily routine.

If at all the Railways needs to continually grow in this fashion, the capitalistic approach adopted sounds very useful. But then one needs to balance that off against the socialistic temptation to remain slack against ticketless travellers , just to enable the poor man who cannot afford a ticket!

For many a time, socialism favours the meek and the weak, and gives an incentive for everybody to become weaker to derive its benefits!

Time to Change our National Game?

Sharukh Khan in his award winning movie “Chak De India” plays a hockey coach, driving the not so famous Indian National Women’s hockey team to win a gold medal and drives home the populist point “A tribute to the National Game”. Makes fine entertainment value. But with our National (Men’s) hockey team failing to even qualify for the Olympic event, a lot of dust has been raised about the lack of importance given to our dying national game. With all these controversies the only game to take some beating is the ever so popular Cricket.I was in Helsinki last winter, a place so far of from India, and with such a sparse percentage of Indian population. I happened to meet a fellow Fin on a train. After some short “hellos and “How do you dos” (typical of a European stranger on a train!). He ventured to ask me “Are you from Malaysia?” I replied in negative. I told him that I was an Indian. Pat came the reply” Oh! Indians …you guys are so passionate about your cricket!”

I recall this incident, today again as the media and all other notable observers are suddenly back to the cricket bashing, on how too much of importance is given to cricket. The accusations range between varied aspects right from — how cricket gets too much of media attention, on how too much money is spent on cricketers, on how government spends too little money to protect our National game.

The nationalist pride again displayed for the wrong reasons. (read the post on http://kplogs.blogspot.com/2008/02/fallen-face-on-floor-still-no-dust-on.html).
This only raises several questions on my mind.

1. Why (on Earth) is Hockey our National Game?.
Yes I know about Indians being the unbeaten heroes of 6 Olympic medals, way back between 1928 to 1956. But then that’s exactly when Hockey started to be played on synthetic turfs, as against the natural turfs earlier. Let us admit that Indians have been struggling with their performance ever since. Today a distant Finnish stranger identifies an Indian through his passion for Cricket! Our identity has changed a lot ever since 1956. Today we are no more an underdog third world nation. Our identity is with rapid -growth, BPOs and Cricket! I think its time to change our National game to a game where we have just beaten the World Champions!

2. Why shouldn’t there be too much publicity for cricketers?
Coca Cola is an American Company, Its an avid sponsorer for cricketing events. But so is Sahara Pariwar an Indian Company. Both these companies would rather invest their money in publicity into a game like Cricket which can attract millions of Indian viewers rather than on a game like Hockey, where it is difficult to find one Indian who can recall the names of all players on the hockey turf! Publicity and sponsorship have nothing to do with Nationalist feelings. Its about populist feelings. So it makes fine business sense for Coca Cola, to invest money in cricket in India and maybe Ice-Hockey in Sweden. After all in advertising the returns are where the audience is.

3. Why shouldn’t we treat Cricketers as Heroes?
As far as the Indian psyche goes, Indians enjoy watching, playing, criticizing and commenting cricket! They love the game. Its players provide us a lot of entertainment value. And simply by that logic, they are heroes. I happened to meet a friend of mine in Gurgaon, who told me this,
“I don’t watch hockey, because its boring! there is no charm , thrill and a feeling of strategy in hockey which is characteristic of cricket!” . Cricket is a game of long term strategy which excites Indians. Indians have never been enamored by 22 people running behind a ball (with a stick or otherwise) in a display of physical talent or immediate thinking. Indians invented Chess, again another slow game with a lot of strategic play! If the Cricketers can entertain us, why can’t they be heroes?

It’s a new and a vibrant India. Should we still fight to keep the legacy in calling Hockey—A game which we don’t seem to be able to imprint in our identity—as our National Game?

A Costly Celebration – The return of Kashmir Singh

Kashmir Singh was on news with his emotional release from the Pakistani jails, as he crossed the Wagah border last week after having spent 35 years on a death row. His return was celebrated, with the Government of Punjab, declaring him a national hero who had sacrificed his life for the sake of the nation and honored him and his wife with pension, and a job for his son.But the same hero did probably a costly mistake just as the media approached him. Being 35 years in jail, might have made him unaware of the role of media in today’s world and he failed to realize that a miscalculated statement could start a storm.
Quoting him ”My mission in Pakistan was not to explode bombs. I was in Pakistan to get the location of their Army and take pictures to get information about their tanks, their guns, their army divisions and brigade, their units and the names of the officers,”

Ansar Burney the Minister of Human rights in Pakistan’s caretaker Government had managed to convince the release of Singh who was convicted of espionage. He managed however to get Singh released with the explanation that he was actually a business visitor, an electronic dealer with a lost passport. He thought that this release will pave the way for a new Indo-Pak relationship, releasing innocent prisoners from either sides of the border.

But Singh’s retort has really changed things for Ansar Burney, the Government of India, the 600 Indian prisoners in Pakistani Jails, and 200 Pakistani prisoners in Indian jails. I doubt if Singh’s statement of denial later that he was not in a stable state of mind when he made that remark, will do any good. At least not after one reads the rather acid remark in the Associate Press version of the story published in websites including the famous Khilafah. (Read the full report at http://www.khilafah.com/kcom/analysis/news-watch/indian-s-confession-disconcerts-pakistan.html)

In the face of the political change happening in Pakistan, where the elections have clearly shown for the first time, a desire for useful trade relationships between the rival nations, India has a question to answer. Will it remain content with the release of Singh at the cost of throwing a spanner on all the good things happening to erase the hostility between the two nations?
Or will India take steps to avoid running a stick into the spokes? Can India reciprocate by releasing more prisoners from the Indian Jails? (May be even some convicted of espionage?)

This decision can be critical; a soft decision as such can really boost the morale on either side to take the path of friendly economic development.

The worst form of Terrorism!!

I recently heard from a friend about her recent experience in an interview where she was a panelist. She was working for a leading software firm in Bangalore, and happened to be rather proud of her accomplishment of having recruited a large number of competent professionals for her company. What startled me of course is a candid admission she made while saying that, she made sure that no Muslim got screened into getting selected. It shocked me and I thought that I heard her wrong! She explained that it was a dangerous risk to take in Muslims into an organization anymore, besides she personally preferred to work with non-Muslims!The recent occurrences of educated employees from leading firms and respectable professions in Bangalore being involved in terrorist plots and being accused or arrested have opened a can of worms. I suspect a strong undercurrent which I wish do discuss in this article.

There are two aspects to these occurrences’.
1. The new face of terrorism, which breeds itself within unsuspecting neighborhoods of educated and sophisticated individuals.
2. A form of terrorism, which creates a rift between people on communal lines.

It is the second aspect, which I believe can get alarming. As far as this new face of terrorism goes, it is very interesting that terrorism improvises newer and newer methods of looping in individuals into its fold. In a few years the methods will not be the same. The police system and the government would have posed a check on today’s events from happening. That will provoke promoters of terrorism to invent newer ways of propagating themselves.

The alarming aspect however, is that this method employed to loop in unsuspecting individuals is leaving an indelible mark on the communal perception of individuals. It is creating fear in the household, in the peaceful workplace and hence creating a communal rift!!

What has been the worst act of terrorism so far? Is it 9/11 or the London bombings? I don’t really think so, for although these events have caused a tragic loss of life and property; history shows that discrete events however disastrous are easily overcome. But the form of terrorism that is most dangerous and self sustaining is the one that causes permanent fear in the minds of the masses! I am afraid that this form of terrorism has struck!!

The perpetuators of 9/11 or London bombings or any other such act will be sooner or later brought to punishment. Terrorist outfits will also be disbanded in the future. But what all the Governments across the world will find it challenging to erase, is the fear in the minds of the masses, against the innocent peace loving Muslims spread across the world.

While we resolve to fight terrorism, we also need to address this concern! We need to educate our children in schools and homes to delink terrorists from religious identities. We need to realize that a terrorist is a terrorist whether a Muslim or not! It is a tough fight against the worst form of terrorism! But we need to fight it. We need to be more cautious of acts of terrorism, but not let ourselves fall prey to allowing terrorism from taking a communal color.