Friday, August 31, 2012

Another stunt?

Angelina Jolie’s stunt director is all praises for her. Jolie, who has ‘no fear of heights at all’, trained three hours a day for three months for Salt. Alongside, this mother of six is trying to raise money for the Jolie-Pitt Foundation with her upcoming clothing collection based on her children’s styles. Could she be aiming to launch the ‘fashion brats’ and not just the ‘fashion brand’?


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Thursday, August 30, 2012

MARUTI SUZUKI LTD.: CHALLENGES

Maruti has been at the top of the list in the Indian automobile market since the 1980s, but with competition increasing in the small car segment, there are storm clouds on the horizon that the company can’t afford to ignore. What should the Indo-Japanese giant do next? by Pawan Chabra

In the month of July 2010, the company sold 100,857 units (domestic and exports), marking a y-o-y growth of 29% – a historic news for Maruti, as this was the second-highest monthly volume ever sold by the company. But this relief was not big enough to scare away its competitors. Maruti will still find it hard to continue living with its 50%-plus market share psychology. With Tata Nano gaining volumes month after month, analysts are of the view that Tata Motors will prove to be a bigger threat for Maruti than for Hyundai. Tata is all set to grab the second spot by displacing Hyundai as the second largest passenger car maker soon. In fact, the company has already done that in the month of June 2010 (though Hyundai reclaimed its second spot in July 2010). However, one needs to remember that Nano is making bigger waves by the passing day. Adds Srivastava, “A lot will depend on the strategy of the Tatas. Out of the total produced units of Nano, how many units will be retailed in India will determine its market share vis-a-vis its competitors in India.” And there are many more Goliaths in the making. Products like Toyota’s Etios, Honda’s proposed small car, Bajaj’s small car, Hyundai 800cc product, Volkswagen model below the Polo et al, are expected to hit the Indian market soon.

Maruti is currently at it to save its ‘numerical’ dream. The company has launched the new Alto with a K-Series engine and soon plans to launch CNG variants of its Eeco, Estilo, WagonR and SX4 models. But if truth be told, it has to focus more on absolute volumes than relative shares. Many-a-time, 10% proves bigger than 50%. Maruti has to work on the denominator and increase capacity soon. Additionally, identifying newer markets and product offerings that consumers desire is what will determine the numbers for the joint-venture. Rest is all well with Maruti.
 


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Wednesday, August 29, 2012

“The Prime Minister has been stoically silent till now”

In the absence of any specific contectual factors of the UPA-I, the present government seems to be taking a completely neo-liberal approach. by nilotpal basu

The Prime Minister Dr. Manmohan Singh, by no count, can be called garrulous. And, these days he has gone even quieter. To say the least, this is surprising. Prime Minister in our country, as most of our constitutional experts contend – is ‘more equal’ than all his Cabinet colleagues who all enjoy equal powers in a system of collective responsibility. Therefore, the almost deafeningly stoic silence that the Prime Minister appears to be maintaining since the beginning of the second avatar of the UPA government is strange.

This is all the more so, since today he is in his own words - ‘free and liberated’. The ‘enslaving’ presence of the Left is no longer around to disrupt his ‘peace of mind’ and derail the process of neo-liberal globalization which has characterized his policy preference! Then why is he not articulating the direction of the government with a firmness that the people and his circumstances expected him to show.

In fact, the anniversary of the UPA-II government which was to be highlighted by a free flowing media conference of the Prime Minister raised a lot of anticipation. But subsequently, as even most of the mainstream media, who never tires in showering accolades on him, has generally come to conclude that it was largely a ‘non-event’. In a way, the performance of the Prime Minister in the event was symptomatic of his government’s performance – lacklustre.

What is it that has changed? The first UPA government – even critics admit had been more ‘vibrant’. With the Left parties around, the tenure marked intense policy debates. And, obviously, the performance of the government in the end did win support of the people to the point of resulting in reelection. There can be, and very legitimately at that, a debate on the reasons for such an outcome of the elections. But, nevertheless, what is undisputable is that it succeeded in sustaining some popular support. Therefore, one is inclined to go into the specific factors which distinguishes the UPA-II from its earlier predecessor, to find out the present state of affairs. The present government has also, during the last election, campaigned on the main electoral platform of ensuring the wellbeing of the aam aadmi. But where the circumstances are different-sharply brings out two specific points of departure. Unlike the first UPA, the second is not guided by a Common Minimum Programme (CMP) – not to speak of the clear mandate against the life and livelihood of the aam aadmi being threatened by the paradigm which was contained in the ‘shining India’ approach – and reflected in the CMP. The second issue pertains to the absence of the Left which relentlessly articulated the need to implement the pro-people provisions of the CMP. The Left also raised opposition to the attempts by the government to effect liberalization of the financial sector and opening up of sectors which involved employment generation like retail to FDI.


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Tuesday, August 28, 2012

What’s up?

How many of us give a real answer to this question when asked across a computer screen?

Author William Dalrymple’s City of Djinns renders a vivid picture of the several rebirths of Delhi. In fact, the roots to present-day Delhi’s class and cultural setting, as per the author’s research and contemplation, lies in the 1947 partition. It may lead one to brood over why those abandoned yet strong roots, still redolent of affection, couldn’t influence most of these migrators to come back, even for a visit? Perhaps, digital divide between the times then and the times now is the answer to this regrettable disconnect. Though the presence of media and the Internet would have helped in knowing the real situation on the ground beyond the spin doctors’ versions, the presence of a social networking site with its ability to trace old pals (and foes) could facilitate reconciliation and healing for many on the personal front. Yet, despite the hope of connectedness that a social networking site such as a Facebook or a Skype and their likes build for separated hearts, there are researches across the world that are showing the contradictory impact of technology. Results show that people lack real friends and feel isolated owing to excessive dependance on the computer for communication purposes. In a recent study by the Duke University on Americans, the social disconnect in terms of sharing personal important issues was found to be widening. ‘From 1985 to 2004, the percentage of people who said there was no one with whom they discussed important matters tripled to 25%; the same study found that overall, Americans had one-third fewer friends and confidants than they did two decades ago.’ Another research by the Michigan University suggests that college students today are less empathetic than those of the previous generations.

Read more......

Source : IIPM Editorial, 2012.

An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).

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Monday, August 27, 2012

Ah, 1985! We just remembered

The on-going Sino-Pakistan nexus is highly dangerous for long term global peace and stability

In a report that shook the foundations of Islamabad, the London School of Economics made a strong case against Pakistan’s claim of a clean sheet with respect to Taliban. Their conclusion is that “Pakistan appears to be playing a double game of astonishing magnitude”.

This allegation assumes special relevance in the context of a foreseeable Sino-Pak nuclear deal. US is strongly opposed to the idea, since it violates international guidelines for forbidding nuclear exports to countries that have not signed the NPT or don’t have international safeguards on reactors. More importantly, the suspected bonhomie between Pakistan’s establishment and Afghan Taliban makes this development even more worrying.


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Friday, August 24, 2012

IT PROVED TO BE MORE PERFECT THAN THEY HAD ACCOUNTED FOR!

BHEL WAS ABLE TO PREMPTIVELY SEE AN EXCESS MANPOWER BURDEN AND RIGHTSIZE IT TO PERFECTION. IN FACT, IT PROVED TO BE MORE PERFECT THAN THEY HAD ACCOUNTED FOR!

However, BHEL had reasons to regret the VRS decision once the power sector in India saw a sudden resurgence post the framing of the Electricity Act of 2003. The act greatly facilitated the entry of the power sector and a ramp up in the scale and number of power projects. Soon, BHEL began to face the dilemma of plenty and from 2004 onwards, it had to take urgent steps to ramp up on its manpower. In FY 2009-10, the total orders for the power sector booked by the company were Rs.419.82 billion for equipment generating 16,489 MW on an aggregate basis. Compare that to Rs.126.72 billion for equipment generating 5313 MW in FY 2003-04. With the increases in orders have come intense problems with deliveries and manpower crunch. Delivery time had just about quadrupled to 48 months in 2008 as compared to 2005. Add to that the Chinese competition flooding the market with cheap equipment and faster delivery times. BHEL’s current Chairman B. Prasada Rao defended the company in the recent analyst meeting, “We have been competing very well with Chinese because the kind of the models we have introduced... and the kind of heat rates we are offering.” BHEL has been winning orders of Integrated Power Projects again during the year. But sustainability is inextricably linked to the manpower situation. BHEL is a unique company in its field in India. Around 4000 employees are being hired every year now. Entry level talent is still available, but there is a crunch at the lateral level owing to lack of experienced people in the field. The home page on BHEL’s web site prominently displays an advertisement inviting ex-employees of BHEL to rejoin. They also recruit ex-employees on a contract basis for projects while they continue to plan ahead for a more suitable mix of manpower at all levels.

Preemptive Action

B. Shankar
GM-HR, BHEL

B&E: What has your experience with implementing VRS been like at BHEL?
B.S: We have had the experience doing VRS at certain points of time. The first time we attempted in in the end of 1980s. Not many people opted for it. And the need then was not so much. Second time we did in late 90s and early 2000s. Three rounds of VRS were done. Around 1998, business situation took a very sharp downturn, so we felt the need to reduce the number of employees. So we did 3 rounds of VRS. At that time, we were very successful, some 15,000 people opted for it. From 2004 onwards, business took a sharp upturn, with the result that we were faced with a dire shortage of experienced people and had to take some urgent steps to ramp up the manpower. If you lose experienced manpower through such schemes, you may get into a jam soon after.

B&E: How can a company handle resistance to VRS schemes?
B.S: Communication alone about the features of the scheme will not influence the decisions in the public sector. Along with that if some steps are taken, like some private sector company went around making arrangements for alternative livelihood/vocation for people opting for VRS. If some such things are done, then people may opt for it... generally, in public sector only those close to retirement will be doing it. There are rumours of increase in retirement age now so it will be tougher at this time. However, Government of India also has a scheme for retraining and counselling for VRS optees.


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Thursday, August 23, 2012

COMPARED TO MUKESH AMBANI, EVEN A BILL GATES IS INSIGNIFICANT AND POWERLESS. AND NOW, THE COMING TOGETHER OF THE AMBANI BROTHERS WILL ONLY MAKE THEM MORE POWERFUL!

I was in Cannes this year for the annual film festival! The day after the inaugural show, was a symposium on Indian films. While speaking at the symposium, I said that the West better take India very seriously as sooner or later, in any case, Indians or Chinese will be owning all the major Hollywood studios, since they are mostly bankrupt and on sale. At the end of my speech, most people who came up to me seemed disturbed by my statement! Many asked whether I really meant that statement!

Well, I surely meant that! One look at the global rich list today and you will see how it has been stormed by the Indians. The reasons, as I said in one of my previous editorials, is of course more to do with the way Indian governments have helped privatise national resources than encourage real brand building abilities – (‘Blood billionaires. Scam Billionaires. Indians storm into the Forbes billionaires list’; B&E Issue dated December 27, 2007). The best proof of my statement is that when it comes to the world’s top hundred billionaires, we have a lot of Indians; but when it comes to the world’s top hundred brands, we don’t find a single brand developed by Indians. However, that, I believe, is going to change – at least partially. Tatas already own Jaguar and Land Rover. And they are seemingly turning the units around. So even if we didn’t create brands thanks to the Kalingas, Singurs and Poscos, our industrialists have been made billionaires by successive governments so that they can now buy up readymade brands and build upon them.

The point, however, that I want to make today is the significance of the coming together of the Ambani brothers in the midst of this situation. Those in the know of the Reliance empire would know that till Dhirubhai Ambani, the founder of the Reliance empire, was alive, one hardly saw much of Mukesh Ambani. While insiders say he used to do the work, it was left on Anil to be the public face; and it worked very well. From a Bollywood star wife to his flamboyance, he was perfect for media to thrive upon. In fact, in the public documents also, one will find notes by Dhirubhai which make it amply clear that he trusted Mukesh more when it came to business activities. Post his death however, the brothers parted ways. And while Mukesh grew and had the right relations with the government as well, Anil went through a rough patch culminating into the latest courtroom drama on the supply of gas for his power projects and the eventual patch up between the brothers mediated by their mother!

So what does this mean for India and the world? For starters, one thing is now almost certain that post the mutual cancellation of non-compete agreements, there would be no need for Mukesh to hunt for other ways to be in the telecom business – his long cherished dream. It’s widely speculated that whichever international player shows interest in Anil’s telecom business, it’s finally going to go to Mukesh. Same will be the case with the financial arm of ADAG. With that, it will be almost like old times. Mukesh will run the big businesses. Anil will own them along with him and would be left free again to concentrate on things he enjoyed – films for one are high on his agenda; one reason for Hollywood studios to beware! It also means that together now the brothers will be more valuable than ever before. Mukesh more so!


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Wednesday, August 22, 2012

The virtuos cycle of growth and investment

Bold but politically unpalatable reforms such as freeing up the labour market are necessary to permit a higher rate of sustainable, non-inflationary growth

India weathered the global financial crisis comparatively well, with growth slowing to a still solid 5.8% at its weakest in the March 2009 quarter. Since then, the economy has recovered speedily, with GDP expanding 8.6% in the March 2010 quarter and accelerating to 7.4% for the entire fiscal year from 6.8% last year. Encouragingly, growth was driven by soaring private-sector investment even as rapid inflation dampened consumption. The near-term outlook is generally bright as surging investment and recovering exports drive should deliver growth near this fiscal year’s 8.5% target. But risks remain that could prevent the economy from maintaining this pace over the next decade.

Apart from possible negative international developments such as a renewed downturn in the US or a worsening of Europe’s debt woes, soaring prices and the government’s fiscal woes are the most pressing domestic economic concerns. The Reserve Bank of India has started to tighten policy, but needs to do more as wholesale inflation remains just under 10%. Much will depend on the strength of the monsoon given the impact of food prices, but capacity constraints mean the supply side is also underpinning rapid inflation as prices for manufactured goods have been gathering momentum in recent months. Further rate hikes, even as much of the world maintains very loose monetary settings, would be expected to put upward pressure on the rupee and weigh on exports.

With the trade deficit expanding rapidly, the authorities are concerned over the potential damage to exports from a stronger rupee, but cheaper imports and inflows of capital would be positive for domestic investment. The trade deficit rose to just under $100 billion for the year in April, well below the previous peak of $122 billion in 2008. The current account gap looks likely to widen to 2.2% of GDP in 2010 as domestic growth outpaces export, but it should be easily contained at under 3% of GDP this year. With nearly $300 billion in reserves, India should easily avoid the sort of funding crisis suffered by some countries with similar debt concerns.


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Tuesday, August 21, 2012

Spooked!

Who knew that this tough, unabashed and outspoken girl would be a chicken when it comes to ghosts? Recently, on the sets of Golmaal 3, Ajay Devgn and Rohit Shetty played a prank on Kareena Kapoor and told her that a woman was brutally killed in the hotel they were staying in, and that her ghost still wanders in the hotel. This story made Bebo’s blood run cold! One thing is for sure, we won’t see this lass in any of RGV’s films!


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Friday, August 17, 2012

World-class brands offered at insane discounts is every fashionista’s dream

To find world-class brands offered at insane discounts is every fashionista’s dream, and it is now being made a reality by exclusive online shopping clubs

But there are lots of other apparels that have a slightly lose fit, which work very well. We also have a fairly detailed size chart so we have sizes small, medium, large, how they correspond with the UK size, the US size, and, even within that, what does small mean in terms of shoulder, bust, waist, etc. Lastly, we also have a very flexible return policy.”

Most Indians have been rather timid in making online transactions, but that is swiftly changing. While cash on delivery is an option, Ishita reveals that “almost 70% of our members use credit cards or electronic banking.”

These sites have also had to fight a tough battle convincing brands to participate in their sales. While they’re mostly wary about discounting their products around the year, some brands like Hidesign don’t go on sale at all as they don’t want to be known as a discount brand. But being able to liquidate their stocks, save on costs of retail and marketing, the closed-door member-only concept and access to a huge number of clients are all factors helping companies warm up to these shopping clubs.

In less than half a year, several such shopping clubs have sprung up, as the entry barriers are very low for Internet-run businesses. And in less than half a year, people from Mumbai, Delhi, Dibrugarh, Trichy and overseas have logged in and shopped from the comfort of their homes. These clubs are here to transform shopping, and they might even soon displace diamonds and become every lady’s, or maybe even every man’s, new best friend!


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