Citizens’ Efforts to Improve Elections

December 25th, 2009 No comments »

I got this mail from Gerson Da Cunha of Agni:

“Since 1999, AGNI has sought to mobilize and guide citizens at the time of elections, whether to the Lok Sabha, Maharashtra Assembly or Mumbai municipal corporation. Citizens of Mumbai have now come to look to AGNI for help in this sense. It was no different for the elections to the 15th Lok Sabha, roughly February to April 2009, with demands and phone calls intensifying as Election Day, April 30, approached.

The queries often became angry, with citizens believing that AGNI was virtually a government department, in charge of the electoral rolls / voter registration etc. As for every election, AGNI ran consultations on, and developed, a Citizens’ Charter and Local Area Action Groups to impress on citizens the great importance of voting. Near Election Day, the Charters were presented to all candidates at citizen meetings.

AGNI made a special point of involving and supporting the media both press and electronic. Not for just this reason, the media supported and promoted the elections in an unprecedented way.

AGNI’s efforts were concentrated on citizens exposed to the media, print and electronic, and those that AGNI naturally relates to: the middle classes. The overall voting percentage was 41% of a voting population of 8 million plus against 43% of 1 million fewer in 2004. But it is now established that there was substantially lower turnout in the city’s slums – 60% of the population – and in Muslim dominated areas. The reasons are numerous and complex, among them problems with interests now called “vote brokers.” Who, then, brought the voting proportion even as high as 41%? It is not illogical to believe that the middle classes turned out in greater numbers this time round, a development presaged by the unusually large queues at polling booths in middle class areas.

This is an eminently desirable development given that these classes are more aware of political issues, are less affected than others by caste / religion / language compulsions, and by money or muscle power.

Some features of the AGNI Campaign

There was a significant volume of citizen ignorance and complaint voiced to AGNI. To help with registration, a locality drive was flagged off in a quiet locality of Central Mumbai. The local AGNI Coordinator got an officer from the local ERO to run a street corner registration office. As many as 200 registrations were effected in an afternoon, compared to only 2 applications over a whole week at the ERO. This is an initiative that deserves to be widely replicated in the city and supported by the CEO / Collectors.

Ms Shyama Kulkarni of AGNI and college students, forming an “I-Vote” group went out to some 30 colleges, supported by local AGNI Coordinators. The CEO Maharashtra wrote to some 80 college principals asking them to facilitate registration of eligible students. In this way, AGNI Coordinators and volunteers were able to get as many as some 12,000 young people registered.

Supply of CDs and Rolls

Citizens’ concern about their enrolment status is a major issue. The CEO’s website is of little use because not everyone has access to the internet and, once there, numerous problems assail the enquirer. The CEO making available to AGNI the rolls on CDs did help. But this is an area that demands study and new measures of assistance to citizens. The AGNI / ERO relationship in several areas helped to resolve some problems but the solution should not depend on this relationship and cooperative EROs. AGNI has the satisfaction of having helped countless people to verify their registration status and to orient Citizen Help Groups e.g. SEVA in Dahisar.

“Meet Your Candidates” events

AGNI conducted or participated in about a dozen events of this kind. Candidates were invited to interact with citizens, sign off on the Citizen Charters and commit themselves to implementation of those demands. We are now in a period of dialogue with elected MPs on an implementation process. Meetings are being fixed. In some constituencies, AGNI was able to motivate voting despite calls for a boycott of voting for local reasons. Five of the city’s six constituencies were covered in this way.

Spreading awareness of candidate disclosures

Alongwith the Association for Democratic Reform (ADR), AGNI summarized and summed up in easily identifiable form the disclosures made by 100 odd candidates as to their police record, if any, education and assets / liabilities. Very useful tables were produced. They were published in an AGNI organ “Mumbai Meri Jaan” of which 3 lac copies were printed and distributed.

Janaagraha of Bangalore ran for AGNI and other citizen groups a series of training sessions in which citizens were prepared for running training sessions in their own localities.

Collaboration with the CEO and State machinery

The CEO and Collectors (City and Suburbs) were understanding and prompt with their cooperation. This cannot be sufficiently applauded. But their attitude was not always reflected at the ERO level, the vital interface with citizens, where neglect, ignorance and carelessness were often experienced.

The election mechanism in the land has to depend on staff from a variety of other departments whose careers do not depend on performance at election time. This explains some of the problems, but not all. Training of such “visitors” must be taken much more seriously by them as well as the election authorities in the State. They will be aware of other ways in which the citizen can be better served, an issue that is given an undesirably low priority, well below the convenience of the administration.”

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How I Learnt What Education is All About

December 9th, 2009 No comments »

It was early evening, the air was cool, and the hall was brimming with town people and high ranking officials '" an unusual sight in a small town such as this.

This was the third year of the Annual Awards for the Most Innovative Teacher's of Cannanore District, a small town on the west coast of India. It's also my hometown, the place I lived in until I was fifteen.

But it was heartening to see the turnout as what started out as a desire to 'do something' was beginning to make a difference!

Three years ago, I read a report from a group of activists that Kerala Engineering colleges were finding it difficult to fill their seats as the high school system was just not producing enough students who could score the minimum needed to qualify in the entrance exam. Some Engineering colleges were taking in students who scored as low as 10 per cent in mathematics.

This was surprising as Cannanore, like the rest of Kerala has a near 100 per cent literacy rate; there's a school within 1-2 km of every village; there are hardly any high school dropouts compared to the rest of the country. The solution lay in making both the teaching and the learning process exciting.

So one day, my wife, who's a teacher, said, 'Why don't you start an annual award scheme to encourage innovative teachers?'

My wife and a group of volunteers among whom were the young, enthusiastic office bearers of the local Malabar Chamber of Commerce evangelized the scheme, held meetings to explain the entry requirements, supervised the evaluation and explained to the winners as well as the other entrants what went into choosing the winners. Of course we were looking for passionate teachers.

The past two years, we have awarded teachers who have taught value of numbers, the meaning of angles and other math things to children in the most creative manner, thus doing away with rote learning altogether.

But this year's prize for the High School Category was an eye-opener. The Prize Winning Lesson Plan in this category went to K Nirmala, a teacher at a Government High School in a village in the district, who used a short story from our legendary Malayalam short story writer SK Pottakad. The story's called How I became a Short Story Writer.

The teacher had taken her students to an old people's home in Cannanore where they spent the day talking to the inmates, understanding why they were there and not with their children. Listening to their stories, the students gathered that a society that doesn't look after its older people is not a civilized one. I am tempted to read out SK Pottakat's story. So here's the abridged version:

'An incident that took place when I was in high school had set me on the path of becoming a short story writer. One day, as I was doing my homework in our bungalow verandah, an old woman groped her way up the verandah steps with one hand, and in the other, holding a dirt(y) envelope.

She kept the envelope on the table, sat on the floor and told me her story. She told me that she had, over the years, sold all her belongings and also worked many years as a domestic servant to give her only son a reasonably comfortable life and to pay for his education. Eventually, she succeeded in her achieving her dreams: he got a job, fell in love with a girl he met at work, married her and set up a house- but without his aged mother.

She wiped her tears and cleared her nose with the old torn towel on her chest and said to me, 'Please write a letter to my son and ask him whether he remembers me giving him food while I starved. Tell him about the time I sold the gold-coin in my necklace so that I could buy him a foot-ruler and instrument-box for school.'

Now he does not like the sight of me. He treats me like a dog and has thrown me out of his house. Please write about all this so that my son will change his mind about me.

I felt l very sad at this poor old woman's condition and started writing letters to her son on her behalf. In these letters, I started adding a few things of my own besides what she told me. After a few months, her son began sending her a little money without his wife's knowledge. I am not sure, whether he began feeling guilty on his own or whether the embellishments I had added to her story made him feel remorse.

The son even once visited his mother and asked her who helped her in writing these letters and when she told him that it was me, a schoolboy, I felt a thrill.

Sadly, well before the old woman could take her son's help, she died. That old and almost blind woman was my first teacher.'

Hearing how the teacher from a remote, small-town, government school, used Pottakad's story to teach children the real values of human life, is when I learnt what real education is about.

END

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The Congress Party Ad Campaign for the 1984 Lok Sabha Elections

December 8th, 2009 No comments »

I wrote this for Outlook Magazine’s special issue on the year 1984

The man shuffled into the room, and cleared his throat. Rajiv Gandhi glanced away from the presentation screen that he had been watching so intensely for the past few hours. The four of us who had been making the presentation to him turned and looked at the man too. It was past midnight. The man noticed he had Rajiv's attention and he shuffled along the walls of the long conference room, bent and whispered into his ear. Rajiv stiffened imperceptibly but his face showed no emotion.

'Is she safe?' he asked. The man nodded. He waited for a moment for more questions and seeing that none was coming, shuffled out of the room, We e returned to our presentation.

It was August 1983, and Ninoy Aquino, that valiant opponent of President Ferdinand Marcos's long, despotic rule had just been assassinated at Manila airport. Rajiv had enquired about his wife Corazon. In times to come, the assassination would catapult Corazon to the Philippine presidency and end Marcos' 20-year regime, but right then, it was one more unsettling event of that unsettling year.

The presentation we returned to was the ad campaign for the Congress Party for the forthcoming Lok Sabha election.

As you can imagine, all of this was heady stuff for the four of us from Rediffusion. Arun Nanda and I were in our thirties and the other two, in their twenties and we were watching world history from a ringside seat. Till then, we were content, in our little world, exploring the creative limits of advertising, experimenting with the newly emerging personal computer to do snazzy media planning and such other turn-ons that befitted a bunch of kids from the IIMs.

Rajiv Gandhi had been shanghaied into politics as General Secretary of the Congress Party; he had, in turn, shanghaied his friends Arun Singh and Arun Nehru into the Party to help improve the party's fast dwindling chances in the imminent Lok Sabha Elections. Arun Singh was at Reckitt & Coleman and Arun Nehru at Jenson & Nicholson, two clients for who Rediffusion had just done feted ad campaigns. So, when our clients were called to Delhi, so were we.

The presentation that we were all peering at was making a significant point. India, in the 1980's, had an electorate of several hundred millions, but we had discovered through rigorous computer-based statistical analysis that only a very small percentage determined election outcomes; the balance were loyalists consistently voting for the same party in every successive election. When we ran these numbers on our computers more deeply we discovered that these swing voters were very different from the rest; they were literate (in a country still swimming in illiteracy) and they were avid newspaper readers (in a country where newspaper penetration was still miniscule). This insight settled our media plan- we would run the Congress campaign only in print.

As for the creative strategy, much of it suggested itself. Look at what was going on just then. President Reagan had just raised the pitch of the Cold War confrontation by announcing his Star Wars missile defense scheme (March 1983), 3000 Tamils are massacred in a genocide in Sri Lanka, sparking off Tamil separatist movement ( July 1983), , Punjab had been on fire all year long and the Indian army had just been sent in to flush out Sikh militants from the Golden Temple in Amritsar (June 2004), half-a-million people are out on the streets of Manila protesting Marcos' rule and Ninoy Aquino's assassination (August 2004), 'confrontation was everywhere!

We correctly guessed that, in this era of uncertainty and turmoil, what the newspaper-reading swing voter wanted was the peace and quiet that only a strong and impartial government could provide.

Will Your Grocery List, in the Future, include Acid Bulbs, Iron Rods, Daggers?, asked the first ad. Ordinary citizens, we argued, need to arm themselves only when governments become weak. Your vote can make the difference between order and chaos. Vote for Congress.

Will the Country's Border Finally Move to Your Doorstep, asked the next, casting an eye on the raging separatist movements. Would you soon look uneasily at your neighbor just because he belongs to another community? Vote for Congress and vote for unity, otherwise it is a vote for separatism.

Can You Name the Country That Has a Higher Growth Rate than UK or US? , asked a third. We discovered, during our number-crunching, that in the middle of all the chaos that India in the five years up to then had grown industrially 4.9% per year compared to a 1.2% growth for the US and a 0.3 % decline for UK.

Can You Taste the Difference Between Dependency and Self Sufficiency? Remember the taste of humiliation in the bread made from PL-480 grain gifted by the US and contrast this to the sweet taste of grain from India's own Green revolution: 150 million tons in 1983 versus 50 million tons in the 1950's.

The campaign was ready to go on four-week notice as the monsoon of 1984 was drawing to a close. We went back to our day-job of trying to make soaps and detergents and toothpaste exciting to consumers, awaiting the start signal from the Congress Party.

Then came the bombshell.

On October 31st, two trusted Sikh guards in Mrs. Gandhi security detail (how many times we must have greeted these two while on our way to meetings there) assassinated her. We and the whole country watch in horror as Delhi goes up in flames.

Suddenly the words we had crafted many, many months ago started ringing even truer than when we wrote them.

Would we, ordinary, law-abiding citizens have to now go shopping for acid bulbs, iron rods, daggers to protect our families from the marauding crowds? Would we start looking uneasily at our neighbours because they came from a different community? Would it now become difficult to find an Indian among the millions of Sikhs and Hindus and Punjabis and Tamils and other? Would the country descend into chaos?

Elections were called soon afterwards. The ad campaign ran as it was first created many months before that; in an amazing turn of events, reality had caught with our ad campaign. And this reality, grimmer than we ever imagined, heightened the nuances of the words and pictures we had used in the ad campaign and gave them an urgency that we had not seen when we created them.

Rajiv Gandhi and the Congress Party won the 1984 election handsomely. But life soon became complicated for him and the Congress. The high industrial growth rate that we had advertised so proudly turned out to have been achieved through large-scale imports financed by extensive foreign commercial borrowings; when worldwide interest rates rose sharply and it came time to repay, India was in dire straits. Unfortunately many, many other countries in the world had also done the same thing that India did- over-borrow from commercial banks at floating interest rates; when international lenders, fearing large-scale default pulled back, what we got was the Great Recession of 1989.

The 1989 Lok Sabha Elections, held with this inflation-stoked recession as the backdrop, resulted in the Congress Party being trounced soundly, teaching the Congress Party a lesson that they probably have not forgotten till today: never hold an election in the middle of a recession or inflation. By then, the Tamil separatist movement, that was sparked of by the genocidal attacks on the Sri Lanka Tamils in 1983 would claim Rajiv Gandhi's own life.
END

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P Sainath: “Is 'paid news' getting institutionalised?”

December 2nd, 2009 No comments »

A sobering report by the journalist P Sainath writing in the Hindu recently

“'Young dynamic leadership: Ashokrao Chavan,' read the headline of a prominent news item in the Marathi daily Lokmat (October 10). That was 72 hours before the people of Maharashtra went to vote in the State Assembly polls. The item was attributed to the newspaper's “Special Correspondent,” making it clear this was a news story. The story showered praise on the Chief Minister of Maharashtra for having achieved so much for so many in so few months. The same story also appeared word for word the same day in the Maharashtra Times, a leading and rival Marathi daily. Two minds with but a single thought? Two hearts that beat as one?

A cute and comforting thought. Except that the very same story (again word for word, only with a different headline) had appeared three days earlier in the Marathi daily Pudhari (October 7). In that case, with a reporter's name at the bottom of the item.

In the Maharashtra Times, the piece ran without a byline. But again, as a news story. There is no mention of the word advertisement or sponsored feature next to the item in any of the newspapers. And unless the bylined reporter of Pudhari moonlights as' Special Correspondent” for Lokmat, while also being a ghost-writer for the Maharashtra Times, the appearance of the same piece verbatim in the three rival newspapers does seem odd. But maybe not so odd? Mr. Chavan seems to have gained greatly from what is now called 'package journalism' or 'coverage packages.'”

…read the full story here: http://www.hindu.com/2009/11/30/stories/2009113055290900.htm

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Book Review: Munshi, Abraham (Editors): “Good Governance, Democratic Societies and Globalization”

November 29th, 2009 No comments »

It has been a source of unending mystery to me why 'corporate governance reform' in India has always meant moving towards the Anglo-American Model in which shareholders' interests are paramount (that is to say, the interests of employees, customers, suppliers or even society at large have no place) , financial markets are a source of not just capital but also discipline and there is no role for government-set industrial policy.

Darryl Reed's contribution in this collection supplies some answers: India has a legacy of a British-inspired governance process which is embedded in our Companies Act, there is a perception among the Indian elite that we tried energetic state intervention in the 50's and 60's and it did not work, we believe that an activist capital market enforces domestic competition and this helps build internationally competitive domestic industries are some of the reasons.

At a more macro level, the Anglo-American model is and is embedded in the ideology of the IMF/World Bank ( dubbed the 'Washington Consensus') and is part of terms for their financial aid to countries. India's turn for this came in 1991 when the country ran out of foreign exchange and had to go to the IMF for a structural adjustment program funding. A series of 'reforms' were set in motion from the top down.

The Editors of this volume calls this approach one of the 'Errors of Simplification' and their view is that national differences matter and that there are many different routes to a liberal democratic regime of governance and not just the one route prescribed by the Washington Consensus.

Who supports such reforms and who opposes them and why has been another source of wonder for me. Darryl Reed has an answer to this. 'Such reforms,' he says, reflects the interests of the international ( and some domestic) business and political elites'. Who exactly these domestic elites are and what specific interests of theirs are served in this support for reform is an intriguing question.

This book is the outcome of an international conference held at IIM Calcutta in 2002 as part of the European Union-India Economic Cross-cultural Programme.

At the time of this conference, 2002, the globalization and its attendant neo-liberal ideology tsunami was at its peak and appeared unstoppable. Many papers in this book assume that and thus many prescriptions are aimed at mitigating its ill-effects by putting a supra-national regulatory system in place.

The Wall Street financial crisis of 2008 and the return of an activist State in the United States turns that assumption on its head. Globalization no longer looks inevitable and the shine has been taken off from blind faith in the power of markets. Other than this perspective , this book is a must-read for anyone thinking about the issue of corporate and country governance. Its available to buy online at http://books.rediff.com/book/biju-paul-abraham

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Thought Leadership at the 7 IIMs

November 29th, 2009 No comments »

The question of whether the IIMs contribute enough to thought leadership is often debated in Indian policy circles. To put this debate on an empirical footing, I waded through some 300 papers and used that as a basis of a keynote I was invited to make at the Dubai Pan IIM Alumni Meet May 23rd 2009: 'Dealing with the Downturn'

If you have been through seven recessions like I have been you know some things for certain. One is that recession come every five years or so; somewhat as predictably as the Bombay famous monsoon which comes every year and flood our roads. The next thing you know about recessions is that they always go away too, often after a year or two. The third thing you know is that everyone at the start of a recession swears that this is the worst ever and that they see no end in sight.

All this we know. But what is not as often discussed is that recessions are often times of paradigm change. For example, at the start of the 2000 recession, Google was a small company with a annual revenue of about $85m and a profit of $10m. Then they executed the pay-for-performance model in advertising where advertisers need pay only if they got results, a paradigm change, and this took them in the next seven years to their present position as one of the largest companies in the world.

Its my belief that the current recession will also introduce new paradigms in many different industries, even though it is hard to tell, at this point in time, what these paradigm changes are going to be.

Lets conjecture what some of these could be using insights from the research work of many different IIM professors.

One I can think of is the role of derivatives in the next decade; derivatives have been vilified of late, Warren Buffet the legendary American investor, even called them Weapons of Mass Destruction and many media reports blame derivatives and other forms of mathematical modeling in finance for the financial destruction that is going on now.

Yet, why is it, ask Prof Jayant Varma, of IIM Ahmedabad, that while banks who traded in derivatives have been driven to distress, that no major derivatives exchange has faced a similar difficulty? The question is even more intriguing when you consider that while banks faced trouble with real-estate derivatives, the exchanges themselves have been trading in all that plus equity derivatives which are twice as volatile as real estate and natural gas derivatives that are ten times more volatile. Could it be, he asks that the methodology used by exchanges to set margins were 'crude' but robust while that used by investment banks were very sophisticated but calibrated to markets? He goes on to suggest that growing computational power makes it feasible to use previously infeasible explicit models of risk based on coherent risk measures like expected shortfall, fat tailed distributions and non linear dependence structures (copulas). His paper, Risk Management Lessons from the Global Financial Crisis for Derivative Exchanges is currently a working paper and available on the IIM Ahmedabad website, and is worthwhile reading for all who are trying to guess at the paradigm change that is taking place in financial service today.

No other topic is heard more frequently these days than the word 'corporate governance'. 'The Intelligent Person’s Guide to Good Governance' is a very timely book by Prof Munshi, Prof Biju Paul Abraham and others at IIM Calcutta. The central argument of the book is that the paradigm of the last decade, an exclusive reliance on markets, or the paradigm of the 1960's, an excessive reliance on the State, may stand in the way of good governance; any serious engagement with good governance, they say, must go beyond an exclusive reliance on the state or the market and must explore different modes of partnerships, including public participation.

Or take the way we currently look at employees. Prof Pankaj Kumar and others from IIM Indore did a fascinating study of Employee Engagement, a concept that reaches beyond traditional concepts like employee motivation and employee commitment. The instrument and methodology they used will be of use for many different types of organization. Their work is published in the IIM Indore's own journal, The International Journal of Management Practices and Contemporary Thought.

Those of us who operate eCommerce businesses know the challenge of assessing an online buyers intent; the problem being that in the absence of a human sales rep to judge the nuances of a customer's intent: what is the degree to which price is important, which among the features of a product matter and to what degree? Or, take for instance, the way we model consumer behavior. Prof Mohanty at IIM Lucknow has been studying this uzzy set theory, which if you recall your Stats 101 courses at IIM is a form of reasoning where a truth value need not be exactly one or zero but can be either zero or one or any value between. Prof Mohanty has been applying this 'fuzzy' approach in a series of papers published over the last few years starting with the International Multiple Criteria Decision Making Conference in 2004 in Canada; in the International Journal of Electronic Business in 2006 (where he added a game theoretic approach as well); at the 2008 International Conference in Advanced Computer Theory and Engineering (where he found a way to mathematically model the 'tranquility' and 'anxiety' that a customer experiences during the buying decision-making process).

During the current financial crisis, many people have asked, how did so many bright people in the financial services industry educated at stellar institutions like Harvard or Yale or the IIMs , make decisions that have destroyed whole cities and industries and left many millions of middle class people jobless and fearful of their future? These talented executives are supposed to be masters of rational decision-making, expert in the usage of formal models, operations research techniques and so on. How could they get it so wrong? In reality, says Prof Mathew Manimala of IIM Bangalore, most managers rely on a set of “heuristics,” , or rules of thumb such as 'Do not put all your eggs in the same basket', which helps make decisions in situations where many alternative courses of action exist and information is unclear or conflicting. . For these original insights, Prof Manimala was awarded Certificate of Distinction for Outstanding Research by the prestigious Academy of Management of the United States and his work has been widely cited. It may lead to a paradigm change in the way we look at decision making.

One of the tenets of the new era unfolding before us embodied in concepts such as Prahlad's ( incidentally a product of IIM Ahmadabad) 'The Fortune at the Bottom of the Pyramid', Clay Christensen's, 'The Innovator's Dilemma' and the emergence of products such as the Tata Nano. Cutting across all of this is the notion that vast new markets are created by products which are 'nearly as good' products as opposed to the earlier notion that successful product need to be 'top quality'. The vexing questionabout this line of thinking has been, how does one decide the optimum level of quality that will qualify as 'nearly as good' and not either sink on the one hand into 'not good enough' or on the other 'too good'?

Prof Rameshan of IIM Kozhikode presents a framework for doing this kind of analysis in his paper, 'Optimum Quality as Strategy: a Conceptual Framework'. This paper was presented last July at the 9th World Congress of IFSAM, held at the Fudan University, Shanghai, China.

Then there is an equally extraordinary phenomenon, the acquisition activity by Indian companies in international markets. Sathyajit Gubbi, Preet Aulakh, Sougata Ray, M.B. Sarkar, and Raveendra Chittoor, from IIM Calcutta, took a look at this and their paper, 'Do International Acquisitions by Emerging Economy Firms Create Shareholder Value? The Case of Indian Firms' has been accepted for publication by Journal of International Business Studies, one of the highest rated journals across all management disciplines.

A hallmark of the last decade, leading up to the current recession, has been the blind faith with which countries have had in 'good infrastructure' as a pre-requisite to economic growth. . You can see this in the mega shopping malls and flyovers being built in Dubai, in the massive SEZ projects in China and India.

Prof Nandkumar of IIM Kozhikode and his partners looked closely at data from Europe Union and concluded that what matters is not any of these, not even policy initiatives such as trade liberalization nor even the use of information technology but the presence of a skilled and scientific workforce. So you can see, all the efforts in building grand Export Zones and glitzy airports matters much less than investment in high quality scientifically oriented workforce.Their paper, Economic Convergence in the Old and the New Economies of the OECD, was accepted for publication in the Journal of the American Academy of Management.

In using technologies such as derivatives, should we look at the institutional context in which they are used? I can think of no better articulation of how technology and society interact than the evocative articulation t of Prof Anil Gupta of IIM Ahmedabad, who says 'If Technology is like a Word, Institutions are like Grammar.' In one simple sentence he has presented to the world a snapshot view of how technology and institutions interact and influence each other.

Our latest and youngest sibling IIM Shillong has also started contributing to the IIM thought leadership effort. Prof Subhrangshu Sarkar has an interesting paper on a subject that all of us , whether we are business executives or financial services executives or scholars have long been intrigued by: is there any connection between the intrinsic value, that is, the book value of a firm and its market quoted value. His paper, Intrinsic Value vs. Market Price, a Sectoral Analysis should be of interest to all of us who are intrigued by this relationship.

It is only appropriate that in these troubling times that we look deeply not merely at the technocratic areas of management but also at cultural and value issues. We have a slew of research papers from IIM Calcutta on these topics. Rohit Varman of our Marketing Group takes a long , hard look at the phenomena of Consumer culture where people portion pursue, acquire and display goods and services that are valued for non-utilitarian reasons, such as status seeking, envy provocation, and novelty seeking. In one paper, Weaving a web: subaltern consumers, rising consumer culture, and television, published in the international journal, Marketing Theory, he points out, among other things the troubling connection marketers make between a consumer culture and other 'western values' such as 'democracy' and 'modernization', as if consuming more is essential to being modern. In another article, due for publication in the prestigious international Journal of Consumer Research, Rohit looks at the emerging anti-consumption movement. There was a time such work might have been viewed as 'socialist', but many of you must have noticed President Obama's remark at the G20 Summit recently about the need to dampen the 'voracious consumer market' that has characterized the United States.

The research ideas I have recounted today need two qualifications. First, they represent perhaps 5% of the valuable ideas that have emanated from the seven IIMs in the recent past. There are many , many more that deserve mention but the limit of time prevents me from mentioning. Second they ones I have presented today represent my idiosyncratic choice. When I look at all the research papers available across the seven IIMs I often feel like a kid in a candy shop- there are so many good choices, why cant I have it all! But you can make your own choices by going to the websites of the IIMs.

In alumni gatherings such as this, we often ask ourselves what can alumni do for these institutions who have done so much for us.Here are some suggestions. Try and engage our faculty in strategy-level consulting assignments. They need the exposure to real-life problems of the business world, they need the access to empirical stuff which is the bedrock of all theory building. Once assignments are crystallized, assume a leadership role in the dialogue between faculy-consultants and your business. As an alumnus you understand the language of both worlds. Be the interpreter.

Try and get faculty members onto Boards of companies you are involved in. Board are great vantage points where faculty members can observe the real world. The world of business is badly in need of more independent Board members and I can think of no better qualified independent Board members than IIM Faculty.

END

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Business School Experience

November 27th, 2009 No comments »

Interview I did with Bhakti Chuganee of Business India , September 2009

Question: What made you decided to go to business school in the first place?

Answer: I had run into an IIM student (by accident) while I was in final year of undergrad and still figuring out what to do next; his glowing report of the multi-disciplinary curriculum sounded exciting to me

Question: Why did you choose IIM Cal?

Answer: At that time ( 1969) there were only two: Cal and Ahmedabad. Since IIM Cal was the first one and ( viewed from the Kerala small town that I was in), Calcutta was 'big city' and the capital of Indian football (which was what I lived for those days)

Question: In hindsight, what was your business school experience like?

Answer: I was a Maths-Physics-Chem type and did not even know that there were ways of looking at the world like Sociology, Psychology, Economic History etc'so, discovering these was breath-taking and life changing. The main lesson you learn when you first enter these all-India meritocratic institutions ( IIMs, IITs, etc) is that there are as many bright people in the world as you, that there are many different types of 'brightness' and that success comes from discovering what you like doing best and from serving society

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The Old Economy and the New

November 27th, 2009 No comments »

Q&A I had with IIT Bombay's Entrepreneurship Cell September '09

Question: You have experienced both the worlds - the old economy (while at the agency Rediffusion) and the new economy (Rediff.com).When do you think the Internet will become an integral part of the media and marketing plan of companies?

Answer: Internet media today is only 2% to 10% of media spend while it is 10%-40% of reach across countries This kind of lag of Spend to Reach is normal in the evolution of a new medium and we have seen ithistorically when TV and Radio came about. This gap is usually bridged in a decade or so

Question: In the Indian internet space a few players are taking away a disproportionate share of the revenue. When do you think this will change and when will revenue convert into profit for the players in the net space?

Answer: Winners-takes-most is normal for ad revenue; the answer is to build a supporting subscription revenue by delivering a really useful service

Question: Today there are hundreds of newspapers and magazines in our country. But a large number of them are loss-making propositions. Do you think emergence of online media like Rediff is a key factor in this?

Answer: Those newspapers that are 'vanity' businesses, that is, those owners who run them for returns such as promoting a cause, social prestige in the community and so on will keep going even if there are losses. The ones which are real businesseshave a decision to make. I personally hope they will all survive and prosper because newspapers are key social actors.

Question: What is the future for e-commerce in India, considering the numerous players in the industry, and the apprehensions the Indian consumer still has about the industry?

Answer: ecommerce in India is held back by poor broadband and credit card penetration and not by consumer apprehension. Government has to act with policy initiatives to fix this

Question: Rediff has been a trailblazer and a leader in the Internet space in India. What were the major setbacks and the major highlights while you were building up Rediff? What has been impact of the US meltdown on your business? How are you coping with the current recessionary business climate? You came up with a ' No ads on the homepage' policy in your latest revamp. How did it affect ad revenue overall for Rediff? If revenues decreased, where did you cover up for it?

Answer: The business we are in goes through techtonic change every five years or so and true to pattern we are in the middle of one right now. The current change is characterized by a move from PC to Mobile ( mode of access), from text to video (form of presentation), from ads to subscription ( revenue), from passive media consumption to active ( user generated media) and from personal to social. And all this is going on while there is a recession. But I think these are the challenges that makes for an interesting life, don't you think?

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How IIM Calcutta Fared in Thought Leadership in 2008

April 22nd, 2009 1 comment »

Speech I made at the IIMC Convocation April 2009

     What an extraordinary year this has been! Iconic companies, the ones who set benchmarks for management practices, companies like General Motors, Citibank, Meryl Lynch and Royal Bank of Scotland have been felled and now exist because of the kindness of their governments. World over, there is a sudden loss of faith in the power of markets, in the sagacity and expertise of corporate chieftains. The very role of the private sector as an economic institution that benefits society is being questioned. Is a new world in the making where there will be a new balance between the role of the state and that of the market? Will the present world economic system that is driven by what some call "excessive" consumer consumption, particularly in the United States, be replaced by some new architecture?

     Clearly, thoughtful people throughout the world are reflecting on all this.

Today I will walk you through some of the thinking that is going on within the IIM Calcutta faculty and graduate students as our contribution to this discourse. As you will see, the quality of this thinking is high indeed as some of the most prestigious journals in the world have published this work.

As a first example, let's take the extraordinary turn of events in which Indian companies long used to playing a defensive game in our domestic markets are taking the battle abroad and in the process transforming themselves in to multinationals. Raveendra Chittoor, M.B. Sarkar, Sougata Ray, and Preet Aulakh looked at a specific case of this phenomena, the story of Indian pharmaceutical companies stepping out into the world in their , 'Third-World Copycats' to 'Emerging Multinationals': Institutional Changes and Organizational Transformation in the Indian Pharmaceutical Industry. This found a place in the world renowned management journal, Organization Science.

Then there is an equally extraordinary phenomenon, the acquisition activity by Indian companies in international markets. Sathyajit Gubbi, Preet Aulakh, Sougata Ray, M.B. Sarkar, and Raveendra Chittoor took a look at this and their paper, "Do International Acquisitions by Emerging Economy Firms Create Shareholder Value? The Case of Indian Firms" has been accepted for publication by Journal of International Business Studies, one of the highest rated journals across all management disciplines. What is significant here is that Sathyajit is the first ever doctoral student from India to get an acceptance in any “A” rated journal before completing the dissertation.

Does the founding context of firms leave a long-term imprint on them and constrain their future degrees of freedom? This question has importance in India as many family-dominated business groups face the new ,dynamic environment. Indrajit Mukherjee, a doctoral student studied this issue and his paper was nominated for the Best Conference Paper Award in the Strategic Management Society Annual Conference last year at Cologne in Germany.

These three papers are from our Strategy Group which is growing into a formidable research team. During the past three years, five of their doctoral students namely, Raveendra Chittoor, Indrajit Mukharjee, Sathyajit Gubi, Anubha Sinha and Somnath Datta presented or will be presenting more than 20 conference papers in top tier conferences such as Academy of Management Annual Meetings and Academy of International Business Annual Meetings. Additionally, half a dozen of papers have been published by them in high quality international journals such as JIBS and Organization Science

Let me move next to that issue that is centre-stage during the current financial crisis that grips the world- the issue of governance. Governance, particularly good governance is like love, something that everyone aspires to and wants but seems so hard to get in today's world. What better time to publish original insights into governance. "The Intelligent Person’s Guide to Good Governance" is a very timely book by Prof Munshi, Retired Professor of Sociology here, Biju Paul Abraham one of our young professors and, Soma Chaudhuri of Vanderbilt University..The central argument of the book is that any serious engagement with good governance must go beyond an exclusive reliance on the state or the market and must explore different modes of partnerships, including public participation.

Another perspective on governance was contributed by Prof Sushil Khanna- he reviewed 30 years of Indian experience in corporate governance and contributed a paper to the European Conference on Corporate Governance in Brussels.

One of the features of today's uncertain world is that a firm's external environment can suddenly and irretrievably change. This shock can be brought about by technological evolution or government policy change or, as we recently experienced, a crisis in housing markets in far-off places. Suddenly a firm finds that human assets created arduously over many years are mismatched to the new challenges. How does the Human Resource policy of a firm respond in such an event? Sumita Kelkar, a doctoral student, guided by Prof Prodip Sett explored the dimensions of HR flexibility and postulated a new one which they call "flexibility inducing HR practices". Their paper, "Environmental Dynamism, HR Flexibility, and Firm Performance: Analysis of a Multi-Level Causal Model” has been accepted for publication in the International Journal of Human Resource Management which is one of the top two Human Resources Management - journals in the world.

This is Sumita’s second publication in this journal.. Her first article was accepted for publication by IJHRM early this year. Both these articles are out of her thesis work at IIM Calcutta.
Contributions from our Finance and Control Group include a novel NPV-based method of pricing telecom infrastructure by Prof Ashok Bannerjee and Debasis Saha and presented at the Hawaii International Conference on Business.

Contributions of our Operations Group include a paper on supply Chain issues by Prof Subroto Mitra presented at a conference in Hawaii; another paper from him on the Logistics Industry at a conference in Lugano, Switzerland; a design of a game management software for the Oil industry by Prof Balram Avittathur presented at the International Service Systems conference in Melbourne , Australia; on modeling regional electricity load by Sahadeb Sarkar at a Honolulu Conference; a strategic planning model for freight movement by Prof MN Pal, Sourav Basu, and Prof Nag presented at a conference in Cartegena de Indias, Colombia; another paper at the same conference by Prof Ashish Chatterjee and Dipankar Bose on Capacity Planning under Demand Uncertainty; one on ordering strategies for short-lifecycle products by Prof Balram Avittathur presented at the International Symposium of Logistics, Bangkok, Thailand; a paper on probability matching by Prof Rahul Mukherjee at the Yokohma, Japan conference on Stastical Computing and another paper at the same conference by Prof Saibal Chattopadhay on designing pilot samples under certain specific conditions; one on aspects of data envelopment analysis by Prof Sanjeet Singh at a Washington DC conference.

Every state Chief Minister sees the setting up of an IT services industry as the route to providing high-paying jobs in his state. You see these well constructed apparitions' spring up on the outskirts of our major cities. You can see many for example on the road from Calcutta Airport into town. What is the implication of this kind of frantic building or land use and land markets? MK Satish guided by Prof Annapurna Shaw, took a close look at this in their paper, "Information Technology, and Information Technology Enabled Services Cluster Growth: Impact on Metropolitan Land Use and Land Markets."

In our attempt to correct various wrongs in our society, we have been experimenting with various kinds of reservations and the jury is still out on which of these deliver the results we hope to get from them. One such experiment is the ongoing reservation of some Gram Panchayat Head positions for women. In a co-authored study, Prof Ragabh Chattopadhyay found that there was a significantly higher investment in drinking water facilities in those Gram Panchayats that were headed for women. The study, "Women as Policy Makers", merited publication in Econometrica, the prestigious quarterly journal of economics. This certainly is a finding that reflects the new era: women make better bosses!

It is only appropriate that in these troubling times that we look deeply not merely at the technocratic areas of management but also at cultural and value issues. We have a slew of research papers from IIM Calcutta on these topics. Rohit Varman of our Marketing Group takes a long , hard look at the phenomena of Consumer culture where people portion pursue, acquire and display goods and services that are valued for non-utilitarian reasons, such as status seeking, envy provocation, and novelty seeking. In one paper, “Weaving a web: subaltern consumers, rising consumer culture, and television”, published in the international journal, Marketing Theory, he points out, among other things the troubling connection marketers make between a consumer culture and other "western values" such as 'democracy' and 'modernization', as if consuming more is essential to being modern. In another article, due for publication in the prestigious international Journal of Consumer Research, Rohit looks at the emerging anti-consumption movement. There was a time such work might have been viewed as in the provenance of socialists, but many of you must have noticed President Obama's remark at the G20 Summit a few days ago that he was not in favor of the "voracious consumer market" that has been the United States for so long.

Other contributions from our Marketing Group: a methodology for assessing the quality of Education as a service, presented by Prof Koushiki Choudhury at a conference on Education in Paris; a similar study on service quality in retail banking presented at a conference in Kuala Lumpur, Malaysia; an empirical classification of the global auto industry by Prof Profulla Agnihotri presented at a conference in Paris.

Contributions from our MIS Group include the following: Prof Debasis Saha on methods to audit LAN-networks at a Hawaii Conference; a method of accurately computing fidelity in routing trees presented by Prof Parthsarathi Dasgupta at an international workshop at Newcastle-on-Tyne, UK; another paper by him on placement of standard cells and gate arrays at a conference at Montpellier, France; a paper on using wireless-sensors in agriculture by Prof Somprakash Bandopadhay at a conference in Geneva, Switzerland; a paper on a pernicious form of online behavior, "shilling" ny Prof Ambuj Mahanti and his graduate student, Sanjog Ray at a conference in Patras, Greece; a framework for understanding technology use by virtual teams by Prof Priya Sethuraman and Prof Snjiv Vaidya at a conference at Christ Church, New Zealand; one on the dynamics of growth of Wikipedia presented by Priya, Rahul Roy and Amitava Dutta at a conference in Paris, France; a paper on valuation of combinatorial auctions by Prof Anup Sen, Prof Amitava Bagchi and their doctoral student, Spumyakanthi Chakraborty presented at a conference in Hawaii; Prof Subir Bhattacharya presented a paper on agent-based model for portfolio selection at the same conference; a paper on achieveing fault-tolerance in wireless networks by our doctoral student D Anuragh at a conference in San Francisco.

Another slant of thinking on values here at IIM Calcutta has been led by Prof Panduranga Bhatta of the Business Ethics and Communication Group- looking for answers for today's challenges in traditional Indian values. His paper, “Using Indigenous Knowledge in Management Education: Indian Experiments” is being slated for publication in the US-based Journal of Management Education.

So, as you can see, the research pickings at IIM Calcutta have been pretty good this year. Encouraged by this we are stepping up the budget for research funded from the Institute's own resources. The results I have described so far came out of a regime which had a budget of Rs 10 lacs a year; this year onwards we have budgeted Rs 2 crores per year.

In addition to this, we have budgeted for each faculty member to go to 3 international conferences in a block of 3 years as compared to just once every three years previously. This is because we understand that world class research operates as part of a world-wide network of ideas and people. It is important that our faculty interact frequently with their international intellectual peers.

I, for one, can't wait to see all the wonderful and original ideas that will flow during this year and which will be my privilege to report at next year's Convocation.
END

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The State of the Indian Online Advertising Industry- Is the Glass Half Full or Half Empty?

April 22nd, 2009 No comments »

Speech I gave at the International Advertising Conference meeting in Bombay 26th March ‘09

     It was in August 1995 that VSNL, then a state enterprise, started an ISP service in Bombay. By the end of that year India had 25,000 users I started rediff.com around the same time, so its been an interesting journey.
     Today, India has 35-40 million users, defined as unique individuals who visit any internet site at least once in the last 30 days a glass-half-full-or- half empty depending on how you look at things, as I will describe shortly
     This user base grew 20% or so and looks set to grow about the same this year that makes us the fastest growing market in the world
     We also have 300+ million mobile phone users; estimates of how many of these access the internet in any given 30 day period vary but 10m looks right
     By comparison, satellite TV reaches 250m and all of Print gets to 220m. So, internet reaches an audience just 20% of TV or Print but delivers a disproportionate reach among SEC A&B groups
The Internet and Mobile Association of India estimates that Online ad revenue in 2008 was around Rs 500 crores or $ 100m. That makes it just 3% of total advertising in India. So, things are at a very early stage.
     The online ad ecosystem is by now reasonable well developed: all major ad agencies now have digital divisions and have started recommending online media routinely in their media plans; besides these, there are at least a dozen, well staffed Interactive Ad Agencies in each of the major metros. During the last year dedicated ad sales networks have sprung up: at least 6 in the general online space, 3 or 4 in mobile ad sales and at least 2 in selling video ads.
     I started by saying that the Indian Online scene is capable of being viewed as either half full or half empty. 40 m users puts India among the top 5 internet markets in the world, and the 20% y/y growth rates makes us the fastest growing. But 40m is small compared to the size of country we are. And this low number means that a generation of young people is coming of age digitally challenged.
     What could make us achieve the true potential of this market which many of us believe can be as much as 300m+ users?
     Universal availability of reasonably priced broadband is probably the topmost driver. This has lagged in the last few years because our telecom companies have , in the immediate past, seen it much more worthwhile to invest in mobile phone growth. Capital markets reward higher mobile subscriber numbers much more than broadband numbers; solving the last mile access problem requires capex and getting right of way permissions requires both money and time. However the last few months have seen a flurry of activity in broadband launches both in ADSL wired as well as wireless broadband.
     Availability of Indian language content is probably the next driver. The absence of standardized unicode based fonts across our 22 languages, lack of Indian language keyboards, absence of unicode language rendering engines in mobile phones sold in India are all contributory factors.
     The third driver is higher credit card penetration. There is a strong link between higher credit card penetration, a flourishing ecommerce system and a vibrant online advertising industry. Online ecommerce players are the ones who get immediate and direct value from online advertising and anything other than the most basic ecommerce requires a user based equipped with credit cards. India has just 10 m unique credit card users- rightfully that number ought to have been 100m + by now. What is holding things up is the absence of a common credit rating system that all credit card issuers have access to. Incumbents drag their feet in joining such shared systems- only firm government mandated action can help here.
     There are good things happening as well.
     After a four year effort, a new version of the Information Technology Act got passed in December 09 in which online players are granted the status of "intermediaries" along the same lines as the Digital Millennium Act in the US and EC Directives on eCommerce. This brings a modern regulatory framework allocating the right balance of liability among all the players in the digital chain.
     Venture capital activity has reached a new high level with companies like Sequioa, Matrix, Draper Fisher and others setting up strong Indian offices. These firms not only bring capital but also insight into what business designs work or not work as well as patience in working with our young entrepreneurs. I only wish we'd have more, many more angel investors who would provide the first Rs 20- 50 lacs to get young enterprises started.
     There is frantic government activity on the eGovernance front. Major government initiatives are under way in digital geo maps, online filing of income tax returns, and the bringing of digital era efficiencies to government departments such as Sales Tax and Land Records. Our massive public sector banks are pushing hard now with ATMs, Credit and Debit cards and online banking. Each of these efforts is important because they demonstrate to the lay public the efficiencies of a digital system and make them familiar with the digital world.
     3G mobile phone licensing activity is under way, and we should see launches by the end of this year. With the arrival of smart phones and 3G there is a possibility that India may leapfrog the PC era as we leapfrogged the mainframe era and went directly to PCs.
     In the balance, maybe the glass is after all half-full!
END