Wednesday, 25 June 2014

Generations & Leadership

Leadership is the word, which to my understanding is having as many number of interpretations as the human beings on this earth. Right or wrong, nobody knows.

Leadership is vivid but varies from ‘History Makers’ to ‘History Destroyers’. Difference lies only in the understanding of person to person. Understanding - the first & foremost requirement to be a good leader. Still lies a challenge in front of us.

What is this challenge all about?  It is nothing but failure of understanding and appreciating the difference.

Today, the business at large is consistent of 4-Generations: Baby boomers, Gen-X, Gen-Y, Millennial and 1- Variation: Female workers. In total, 5-Mindsets.

Each generation and female worker has its own set of values, biases and preferences that make them unique and different to each other. Until these differences are understood by organisations and their leaders, organisations and leaders will fail to tap the talent.

If we talk specifically about the reasons of misunderstanding, the boomers are inclined to and demonstrate commitment with 84-hrs workweeks as they have gone through that learning in their development time

Millennials today understand loyalty just opposite to Boomers and Gen-X understand. Loyalty for them does not mean staying at a company, building a career and retiring.  But something different. Each millennial wants to be treated distinctly and be appreciated for his/her contribution separately.  They want to love their company only if the company reflects who they are. Wow!!!

Gen-X: Sturdy, stupid generation of today. It is these who do not understand the generation next to them - Gen Y. Why because they do not want to understand. Simple!!!

Gen-X always wants their followers from Gen-Y to go through the same experience as they have gone through in their life. If suppose, they were given position of responsibility after 5 or 10 yrs of their joining a corporate, they wish today the same for Gen-Y.

Gen-Y on the other hand look for a place that is better aligned with their values and work styles. Gen –Y, a generation i.e. self-absorbed, entitled and tech-crazy are different in their work ethos. They leave work place dot at 5 and come online soon later and stay hooked till past mid night. They do not want to waste time in ‘learning by doing’ but want to contribute then & there. They want meaningful work projects, with even the most entry-level recruits wanting to feel connected to the greater mission of the organisation. This is what Gen-X fails to appreciate. Gen-X is hell bent to give them the same experience as they have undergone in their past.  Disconnect lies here!!! 

Further deep into the psyche, boomers who have revolted against their parents, still desire respect from next generation. Wonderful expectation, isn’t it?

It is where the change has to begin. But alas!!, it is taking all un-required time to happen. Just because, as research has demonstrated that humans subconsciously process information related to friends or ‘in-group’ people differently than processing the same information related to strangers.

Leaders and Followers are Strangers, today. Both are in their own worlds of Processing. Leadership however, has to start with understanding of Culture, Gender and Generations.  Few people understand it, they become hero, either in their own life time or later. But they do become hero. 

If we could learn to appreciate these differences, production and productivity will improve automatically.


Give it a try colleagues in Corporates here in India, and elsewhere in the world.  Corporate World will be different.

Thursday, 22 May 2014


Removing gender bias is a collaborative effort

It is important for an organization to ensure that managers and subordinates work collaboratively to remove gender biases


Rajesh Tripathi

Gender bias occurs because of personal values, perceptions, traditional and orthodox ideologies one hold on to in his life. Whenever we talk of gender bias at workplace, it is commonly referred to the discrimination women face at the workplace. At an age where people and activists are advocating the thoughts of emancipation of women and the need of ‘socent’ culture, there is a ruthless fact that only 4.2% of CEOs in Fortune 500 companies are female.
We can break down gender biasness at the workplace into three different types. These are namely biasness in terms of growth opportunities, remuneration, and treatment meted out at the work place. A majority of women carry apprehensions to come out in open about such biasness. On other occasions, they just go with what they assume and don’t try to seek the reality.
If we compare traditional jobs against the non-traditional ones, we observe that women are relegated or else considered for low-paying, clerical or administrative jobs initially, as opposed to men who are more likely to be placed in career paths straightway. For example, in the manufacturing sector, women are more often assumed as not strong enough to tackle shop floor hassles. They are, therefore, considered only for table or back office jobs. The perceptions of people influence their thought process and they are driven by that. The natural cycle of a women’s life also adds to their woes. As maternity leave is considered not a mere sabbatical but more of a stop gap in their career. This also hinders their employers and their aspirations are curtailed so as to limit their considerations for potential leadership roles in their organization. Even in management functions, options are limited for them because of their limitations with mobility. Since they also have to manage their domestic front, this parallely add as a catalyst to the cause.
Gender bias at the workplace often leads to a hostile working environment. Employee motivation may be hampered. It may reach to a level where the company is in the news for all the wrong reasons. This ultimately diminishes and slowly annihilates the company’s brand image. Gender discrimination also results in loss of productivity as employees are not motivated enough to give their best. Such kind of discrimination also creates an imbalance in the workforce population as women tend to leave the corporate workplace in pursuit of better career alternatives.
Not offering fair opportunities to women may translate into lost business prospects. Women are considered to be more innovative and creative. The human resource department within an organization plays an important role in promoting equitable practices and also creating an environment to foster the best in them. To drive the message on the need to inculcate the value of fair treatment, whether be it with managers or with subordinates, is a collaborative effort.

Topics: Culture


 Jump to Comments

Rajesh Tripathi

Rajesh Tripathi is the Vice President & Head-Human Resource at GHCL Limited More

Published in People Matters 20-May-2014

Wednesday, 21 May 2014



When the corridors of Power & Commerce Collide



As published in the Times of India, 21-May-2014

Monday, 19 May 2014


Salaries: whether to keep Transparent or Confidential?

My views as published in the Hindustan Times

Thursday, 1 May 2014

Is your Cost-Orientation a hindrance to Company Growth?

Research reveals that brain at any given opportunity does try getting into the comfortable zone, what makes our Habit. If the same theory is applied on organisations which are considered living entity, brains of employees try doing routine, controllable activities.

Every organisation – for any activity, big or small does follow the Principle of Planning to undertake an activity. But deep down every activity being undertaken is seen under the lens of cost. Therefore, planning, invariably turn out to be a ‘Cost Planning’. Reason, cost planning by & large is under the control of the company. In other words, cost planning makes a company becoming its own customer. For example, decisions pertaining to how many employees to hire, how many machines to procure, how much raw material to purchase, how much money to spend on capex etc. This nature of the organisation displays the peculiar traits associated with a customer and like any other customer, the organisation decides to stop buying a particular practice or service. Focus therefore remains the cost. However, as always, there are exceptions to it where company has no control over some of the costs, as it may be imposed on it under some laws. Bust such costs as imposed on a company by others make up a relatively small fraction of the overall cost. Primarily, most of the costs are derivative of company controlled costs. Do agree with me on it, Reader?

But very axiomatic question comes to mind, why companies get into such thinking mode? Simple reason- it is very easy to plan controlled costs with relative precision. It is this tendency of organisations which turns out to be anti-growth for them.

Mind it, I am not saying cost planning should not be done, but one must ensures that those costs which can help organisations grow further, should be undertaken. Strategy oriented costs should not be seen under the lens of Cost Planning.

 Second obvious question comes in mind is when learned professionals know flip side of this approach, why then does it happen? To my understanding, it is due to ‘planning-oriented-mangers’ tend to apply familiar, comfortable cost-side approaches to the revenue side as well; treating Revenue Planning as virtually identical to Cost Planning. But that does not in fact work for Revenue Planning. Revenue Planning is in the hands of customers and not under the control of organisation except in case of monopolistic markets.

“Bottom-line for ‘Bottom-line-obsessed companies is predictability of costs, is fundamentally different from the predictability of revenue.”

I can very well say, if companies want to grow, they must apply different principles to Cost Planning and Revenue Planning, or otherwise they will become redundant one day, as cost whatever one does will be having spiralling effect. No one can cut every cost. Revenue be given more importance to cost without blinking on cost under control approach.

Tuesday, 29 April 2014

Tuesday, 22 April 2014

Why a strategy fails to remain a strategy?

In one of my earlier blogs I wrote about how strategy is different than a problem.

Let me try giving some more insights about strategy and ‘misuse’ of the word strategy in the corporate.

If I say that the strategy is futuristic in nature which defines decision of making thoughtful choices. These choices explain assumptions about choices and reasons of choosing to do something and why not to do something.

But the reality is different.

Very seldom, you will find the word strategy being used alone. Generally, it is sufficed with ‘planning’ or ‘plans’. Therefore, the strategy becomes strategic planning or strategic plans. This change leads to very catastrophic change not to the word itself but even to the thought process in the organisation.

Plans or planning denotes actionable events which are scheduled in advance to carry out in an agreed manner later. It means aligning some doable actions.

More so in organisations, strategic planning starts with referring to the vision or mission – a lofty, aspirational goal- as some say. The vision or mission is then taken to identify some related initiatives. Each ‘identified’ initiative is put under the scanner of ‘Financial Feasibility which in turn leads to ’annual budgets’. The moment this is done, strategy is relegated into the background. Chaos erupts out. Initiatives fail and whole word demean the ‘strategy’.

Annual budgets are not used to define a strategy rather a tool check the financial stability. Secondly, initiatives or for that matter financial numbers provide knowledge about short & medium term success.

A strategy is not a financial budget. So is the case with the planning, as planning is not explicit about what the organisation chooses to do and why.  Planning in reality talks about logic of affordability and therefore, it can be supervised. As we were supervisors during our course of career, we tend to go back to supervision and fail to understand the real meaning of strategy. Regarding ‘plans’, it again revolves around allotment of organisation resources.


So, when you come across strategic planning or strategic plans, beware, they are not talking about ‘Strategy’ per se. Check with people what they mean before you react.

Tuesday, 15 April 2014

A strategy is different than a Problem: Change your ways to tackle them separately.

Strategy – the most abused word in corporate corridors, is perhaps least understood. Different people use it for different reasons, giving different reasoning. However, the most common misuse by top executives of organisations is when they change a challenge into a problem and then try tackling such a problem by tried and tested tools. These tried and tested tools are put on piece or pieces of papers after long discussions – sometimes running from weeks to months, under the pretext of Strategy Making. Sometimes, another name of ‘Comprehensive Plans’ is used instead of strategy. Agenda remains only one, tackling s problem – far away from their real intention of making a strategy.

Idea behind such activities in organisations is to feel safe & secured in the dynamic market conditions. The feel predominantly is that as they have well placed strategy in place, hence their business is secured. The reason of such acts of learned well educated executives around the world is overcome the fear of failure and discomfort.

Do you such things in your organisations, readers?

But fact remains a fact. Fear and discomfort are real and integral part of strategy making. The litmus test of a ‘would be successful strategy’ is shades of discomfort and fear about its success. The reason behind it, nobody can see & predict future, therefore no one can make a full proof strategy.

A strategy in real sense is about placing bets and making hard choices. Hard choices? That people dread the most.  For all reasons, I can say a strategy should have inbuilt ‘risk of failure’ in it. In other words, strategy can not eliminate ‘risk of failure’ but only increase the ‘probability of successes.’

As organisations go along, a defined strategy should provide the flexibility to change it.  No strategy can avoid unexpected hurdles in its way. Further, ‘Perfection’ attitude in strategy formulation has no place.


So strategy formulators please do not get disheartened when your strategies come face hurdles on their way of implementation, just ensure you have given enough room for taking correct actions. 

Wednesday, 9 April 2014

Cost or Quality will not make your Organisation successful?

You may find organisations struggling to make profit, despite their been having best quality producst in a different category. 

Reasons - failure on their part to respond to customer need and ever changing world, complacency to shrug off need to change themselves and the worst, looking for reasons to justify not to change. One of causal relationship in these companies is their ‘inward’ looking approach.

Cost and quality are hygienic factors in business today. No company can survive if it does flirt with quality or cost. At the same time none of these two provide, any base for differentiation and therefore no reason to charge premium. Companies which do not have ‘anything’ in their product or services to charge premium can only make ‘Survival Profit’ for short run. Lucky companies can slower down their speed to death as they luckily got a distinct product category. But question comes how long?

New world has given a more serious threat as they lowered down their cost of production by exploiting Economies of Scale but at the same time maintained high degree of quality standards.

Man does not stop at challenges. Rather, challenges help him in being more creative

Organisations have to build a ‘Culture of Receptivity to new Ideas’ i.e. Culture of Creativity thereby any and every idea being tossed to it formally and informally is put to test before being rejected having no substance. Mind it, ‘ideas are not incubated in labs but in a positive atmosphere of Receptivity to new Ideas'. All studies show, organisations fail when they start avoiding new thinking on one or other pretext.

Organisations therefore, have to look for ‘External Exposure’ to create differentiation in their products or services to look for premium.  We all know, source of profit is value being derived from a product or service by the customer or consumer. It thus, means any activity which can define further the value enhancement in the entire value chain can help organisations in achieving differentiation in their products or services.  Differentiation leads to Premium. Organisations have to look at both ends of its spectrum to enhance the value of its products or services. At one end, they should look for integrating very closely with their supply chain partners, improving their manufacturing processes and at the other end they should optimize customer value across the whole chain, not just their part of it and should also harness technical capabilities of their supply chain partners.

At the end, organisations should create an ecosystem of its own to build either product or service superiority. Mere focus on cost will not guarantee profitability in changing world and down play with quality will wipe the organisation overnight.

So, what stops organisations to be successful, it is only organisations. Do you belong to such an organisation? Change it.

Tuesday, 1 April 2014

Leadership in VUCA World

"Leaders need to 'see around corners' - to see something significant about the future that others don't see.'

An apt saying for the current VUCA world, where everything & anything is volatile, uncertain, complex in nature and ambiguous by its presence or absence.

Leaders make plan well in advance and try achieving them by organising resources around those plans. But the reality hits them hard on their faces when these plans are either under achieved or not at all achieved. This can very well be seen in slipping down financial numbers in majority of cases.

Learning by most of executives to my mind is cribbing about the conditions & cursing it, instead of taking appropriate actions. At the same time there are leaders and organisations which undertake diagnostics and change themselves to 180 degree. It therefore means what all needs to be taken into account in this VUCA environment and come out successfully are.

a.     Actions & Comprehension
Clarity in the minds of leaders is the foremost point to succeed. No effective actions can be taken if the clarity is not there about what all needs to be accomplished. Once, the clarity is established, it becomes very easy to channelize resources and people around it.

More VUCA environment, the harder it is for leaders to comprehend the situation. Resulting in the difficulty to comprehend and articulate it. This leads to inaction by leaders or simply following the down trodden path of reaction.

Therefore, it is of utmost importance to articulate well what all to be accomplished and actions should not stop.

b.     Higher in position, tougher to articulate an objective
It is seen that inaction starts at the top. Any immobilisation at the top has multiplication effect at the bottom. Leaders are being watched by their followers. They watch you for your every action & inaction and accordingly make up their minds to take actions or not.

Leaders need to force themselves to get clarity in their own minds and let their subordinates know how they see things. Articulation and corresponding actions will become easy for both leaders and their subordinates respectively.

c.      Look for Actions and not for Right actions
I believe ‘one cannot see future with clarity and therefore it is almost impossible whatever one does will test the testimony of time and will come out right.’

Instead of fighting for the right actions, it is imperative to take actions. Correct the actions on way, if required.

d.     Establishing a Common Purpose
Objective in hand will give leaders required insight on continuum. Objective also will give a common purpose for the people to align their actions.

Leaders could not see that their incapability to bring people around one common purpose will eventually be fatal for the organisation. Only thing they may see or in most cases may not, the date of fatality.

e.      Lead by Values
When everything around is so ambiguous that a decision cannot be taken, leaders should lead themselves by following their values.


Value your values. I believe in ‘When going gets tougher, hold tight to your values’. Any slippage on your values will put you on a wrong path. Leaders need to make their organisations ‘to be values led’. Mind it everybody is watching you.

Monday, 31 March 2014

Saturday, 29 March 2014

Commoditisation of a Product- Who is responsible for it?

Who wants to see their products becoming a commodity? But it happens. Market forces are relentlessly striving to make every other product a commodity product. Reason, it is easy to ‘imitate’ than to innovate - a short term haul to become successful.

Whose mistake is this to see happening, their products becoming commodity products?  I am sure; you will agree with me, it is companies who allow it to happen.

Reason, ‘Product Differentiation’ requires relentless innovation at the end of the sellers - but this needs a different mindset along with resources.

Yes, there are companies who defy the ‘rule’ of commoditisation and continuously, unabatedly try putting in time, efforts and resources to innovate. Result, these companies charge premium and ensure for themselves Sustainability.

Each and every product can be differentiated or allowed to become a commodity, I believe in it. You simply need a different mindset.

As rightly done for his company by Franklin D Raines, Chairman & CEO of Fannie Mae, who later said, ‘People talk about mortgages as commodities. But........ nothing has to be a commodity. Not even mortgages....... Indeed our strategy is to transform mortgages from commodity....... We are not talking about mere branding, we mean creating real differentiation that consumers value.’

Do you see the difference in the above quote? Only of the mindset.

In commoditization, product differentiation is destroyed by competition and therefore buyers refuse to pay any premium. Under pressure to survive, companies immediately try becoming ‘Low-Cost Leader’ and consequently resort to Cost-cutting as the only means. Commonest & easiest actions are taken, as these actions are under the control of companies. Actions like moving production to low-cost locations; trading low margins for hopefully to have higher volume; pleading to customers to ‘let them have some margins’ by sharing their cost structures and overall just focus on ‘Sales’ and not any other thing, including ‘Marketing’ to differentiate and charge premium are resorted to.

Companies have to change their ‘Thought Process’ and must become ‘Problem Solver’ for their customers and not simply a producer of products.  Companies have to integrate their businesses with their customers and work on the problem areas and solve them for their customers.

‘It is not mere having a product that can make you demand premium, but a product has to be wrapped in the ‘Wrapper of Service’ to command premium. I believe in it.

As rightly summed up by a CEO; ‘Companies sell services only when they cannot sell their products.’

Other thing I want to exhort to here,  is that ‘No two customers in any industry have similar needs.’ It thus means principles of Segmentation and Marketing Mix have now reduced importance in today’s business world. Companies have to move away from segmentation and marketing mix to create differentiation.


Every company has ‘genes’ of Differentiation and Commoditization. Choice is of CEOs what they want their company to be known for.

Monday, 24 March 2014

Domestic Cos go slow on Expat Hiring, turn to Indian Talent


My views got coverage in many daily newspapers of India. Also, find enclosed below the online link regarding the same:











Sunday, 23 March 2014

5Qs: Ingredients to make you and your Organisation successful

Every one - organisations to people - want to be successful, in this rapidly changing world. Success means different to different people. However, bigger part of the society, including organisations and people generally, do measure success in the term of monetary advancements? So what organisations and people have to look at continuously to make advancement in the set direction of success are Soft and Hard Resources. It is not only availability of these two ingredients which make someone successful or otherwise, but the proper mix of these two is of paramount importance. Of late, it has been seen that soft part is gaining utmost importance.

The world today is primarily facing two challenges - understanding & making sense of the changes around us at both individual and organisation level, and setting direction & making progress in an increasingly unpredicted world; rather on positive tone, daily unfolding world.

It would not be of prudence here to talk about the Hard Resources like material, machine, capital etc, as the whole world has understood its limited role in the success - whether an organisation, for that matter even an individual. There are many examples of successful people and organisations that have underrated importance of hard resources in continuous success. Best example is of Ford.

To make sense of fast changing world and fast acclimatization & accommodation at the end of organisations and people will help in achieving success. There are following 5-Qs which therefore need to pay attention to:

·        Intelligence Quotient
·        Emotional Quotient
·        Resilience Quotient
·        Political Quotient
·        Moral Quotient


 I will deal with each quotient, one-by-one in my next blogs. So look for it

Friday, 21 March 2014

Do Organisations know who their Customers are?

You inquire CEOs about what sort of companies they head. More often than not, answer you get is, they head, 'a Customer-Focused Company’. But, you find them fumbling at your second question of who their customers are? Most of the time, you might have noticed, you get generic answer to this specific question.

Reasons could be many.

One general reason could be overwhelming ‘use to misuse’ of the world ‘Customer’. However, the specific reason which I see is the  hurry on the part of CEOs to make quick bucks, covering as much catchment of customers - relevant to irrelevant, as possible.

Coming back, this fumbling you can see in an entire organisation, where you even come across the word, customer being used for interdepartmental relations; by employees of one department to the employees of another department. More difficult it becomes for me to even understand about their intention for this ‘misuse’. On one hand companies insist on departments, calling each other as customers and on the other hand, they insist on building a culture of collaboration among departments and their employees. Collaboration with Customers, can you digest this proposition??

If I look at the understanding about the word ‘Customer in business perspective, customer is generally defined who can add value to revenue. It thus means who can help in increasing sales. But such short-sighted interpretation leads to confusion among not only employees but also ‘real customers’. What I call ‘Diffusion of Confusion’. More is the diffusion in a company, more will it have confusion. This confusion eventually, erodes the basic perspective of doing business i.e. increasing revenue.

It is therefore suggested that every company first, therefore should take the cognizance of the importance of identification of set of people who will not only increase the revenue but help a company in unlocking the most of the value in a business. Until, a set of people which can be defined as ‘Primary Customer’ is not identified by companies, who can continually provide unlocking business opportunities to them, companies will only be successful for a while and will only falsify their claim of being ‘Customer-Focused’

I am quite often been asked, whether there should be only one ‘primary’ customer or it could be more than one.  My response generally to this query that too with a rider is, a company can have as many primary customers as it can deal with it & unlock value residing in the relationships but first, companies should check their resources & competencies. There are instances wherein, companies have identified up to 4 primary customers, but it is suggested that a company should have only one primary customer.

Whatever be the number of Primary Customers, a company choose; it must remain focused on those selected primary customers. Any inconsistency will only dilute its business perspectives and reputation the market.

The advantage of being focused on selected few customers, will help spread the understanding at every link of entire value chain. Starting from suppliers to buyers. This will lead to building unparallel Customer Loyalty, which will help in creating wealth ultimately.

Further, once primary customer is identified, it will help in continuous value adding interactions with each other. A company and its customers. This interaction will help in knowing the exact needs of customer and fulfillment of the same by the company. End result, unlocking of value and better revenue.

To become customer focused, a company should look at three facets of self and its primary customers. These are company perspective in the market, its capabilities and finally, profit potential from its identified set of people as primary customer.

The company perspective usually provides insight about a company’s liking and disliking, its nature, its culture. I will say in sort, it is ‘soft part’ of a company. For example, you may hear about a company that it is frugal in nature or it provides superior experience or like for Apple, it is perfectionist.

Capabilities on the other hand, give indication about a company’s competencies to provide desired product value, as desired by customers.

The third facet predicts about a customer’s profit providing ability. Every customer cannot provide value to a customer. For example, customers for high end luxury products are different than utility oriented customers.
Also, companies need to keep in view that within the same market and industry, different primary customers may value different things. This could spread from low-price to service quality to convenience to technology to specific attribute in a product.


Conclusively, it can be said that to become a Customer- Focused’ Company, companies need to work hard initially in identifying their primary customers or otherwise, calling themselves  as customer-focused will only remain a tag for them and not value adding connotation.

Sunday, 16 March 2014

Cost of Thinking: A variable in the Profitability Formula of Organisations

A customer when is out for a purchase, he is not miffed about his purchasing decision. Mind already has taken a decision, what to purchase & why to purchase. However, sometimes you become jittery when you see an advertisement about a new product in the same product category, you intend to purchase while on your way to the shop. Did you ever experience it?

Two theories come in play. One theory explains mind’s continually attempting effort to minimise hidden costs and hidden risks. Therefore, it is the force of mind, compelling the customer to buy a known product only. The second theory describes what all goes inside when you look at a new product.

However, the underlying facet of both the theories is where ‘Advertising’ plays its role.

In my one of earlier blogs, I explained about resistance of brain to experimenting newer things. It always tries going a beaten track. It always looks for stability so that it does not have to apply its ‘brain’ again to know about the new thing. This aspect of brain helps us in building our habits. It follows a pattern of thinking out of its habit while taking a decision; any deviation to earlier decision criteria, puts it into ‘discomfort state of mind’.

This is where the Law of Advertising comes in picture. Advertisement and repeated advertisement first breaks the inertia of customers about a new product and then same inertia is used to stop customer switching over to another product later. What a brain, we human beings have? Same principle, two applications.

In researches conducted on consumer behavior so far, not much has been found how brands influence customers at macro level but it does when seen at behavior level. Advertisements incite & persuade customers to buy a product based on specific advertisement themes.

What goes inside our mind is that customers try minimizing their efforts directed towards reducing hidden costs and hidden risks of using a new product. These efforts are primarily focused on minimizing efforts  for information acquisition, learning, storage, retrieval, comparison, evaluation etc. This is called Cost of Thinking.

This habit of ours put us into a very awkward situation. If I say that this habit of ours only makes us pay premium on product we purchase and that too again and again. Out of this only, companies compel their customers to buy their products again & again and pay premium of using it repeatedly.

Conclusively, it can be said that our intention to reduce, Cost of Thinking, helps companies to make profit for themselves. Companies as per available research data available, try getting targeted and potential customers to their fold using the ‘principle of minimizing the Cost of Thinking.’ And the means used for this is ‘Advertising’. Advertisements are aimed to incapacitate customers of thinking to switch to another brand. Thereby, making customers buy same product or products, over & over again and also pay premium for our ‘habits’ at continuum.

CEOs, so do not hesitate, go for & keep aside a budget for branding your products and reap the benefit continuously. Advertising is the winning Profitability Formula; do not doubt its advantages.

At the end, it is the game of Mind only.


Mindless Experience or Mindful Action: what makes a difference for success?

Human is slave of its behavior. Brain makes behavior for the reason of not doing his job. Brain does not want ‘one’ to change; not only this, ‘other brains’ do not want other to change too. In essence, we all seek stability. We do not want to go through the grind every time, despite the fact the ‘grind of time’ is ever running. Everyone wants to keep hold of everything and anything. Brain, I say is not in one’s control. It literally takes granted the ‘holder’.

Conclusive impact in the corporate world can be seen when you see a manager talking to his subordinate, ‘This is the way to do it.’ How come there is only one way of doing one thing. It is not managers only who stop creativity, out of their fear of losing control?? Look at other manager, saying ‘I have experience of doing it, so you have to do it the same way’.

How unfortunate it is. How mindless we become due to our habits of seeking stability by stopping other from attempting something afresh. Let the experience people know, the relevance of ‘experience’ is to learn but not to follow. 

Context and perspective keep changing, ever changing. Unstoppable.

It therefore means that there is not only one way of doing a job but many ways. Only difference is or rather has to be, the chosen way should depend on the current context.

‘You can’t solve today’s problems with yesterday’s solutions.’ Ellen Langer says.

What it does mean that what made one successful, cannot make other person successful by following same rules of success. Context changes, time changes, even perspective & objective changes of doing a job; than how come one rule applies to all. Mindless thinking.

Be Mindful to be successful, she suggests.

Mindful state makes you get the guidance from old rules, routines and goals but never allow them to govern you, today.

Research of over nearly 40 years done by Ellen Langer proved be mindfulness.  She has defined Mindfulness as a process of actively noticing new things.

“Mindfulness makes one, more sensitive to ever changing context and perspective. It is the essence of Engagement.” The study of Langer revealed that by paying attention to what is going on around us, instead of operating on auto-pilot, we unlock our creativity and boost performance.

So, go around ‘mindful’ to look at things in your own perspective in different or changed context. ‘Experienced people’ will try putting before you their perspective even in changed context today. What a mindlessness proposition. Isn't it?

Saturday, 15 March 2014

Indian Economy: Reviving the Growth

A surprising but the fact is that the Indian Economy grew at the rate of around 8% till 2011-12; quite opposite to the general perception. This reality does therefore give a hope that nothing much has slipped out of our hands in terms of the Indian Economy. It was just one year back we were crunching average 8% growth per year that too continually since 2005. A well deserved appreciation for the economy which was known for the ‘Hindu Growth Rate’. This is just opposite to the wide spread criticism of late, for the Indian Economy not only in India but across the world.

First, let us look into what all made India achieve ‘Accelerated Growth Rate’.

Primarily the reason of this continuous feat for a period of 7-8 years was that every single sector contributed to the growth. Although, the blue-eyed services sector which made it largely possible, others were not left behind. However, other two sectors which contributed immensely to this success were agriculture and manufacturing. Manufacturing sector grew at a reasonably unexpected rate, particularly in the watershed year of 2011-12 it grew at the rate of around 7.4%. Agriculture grew at the rate of around 3.6% in the same period. Other economic factors which helped India achieve the feat were its domestic savings rate, making Indian economy, one of the fastest growing economies. What came handy was enough money making opportunity and Indian habit of saving money.  Country reached to its highest ever level of domestic savings of 36.8% and Investment Rate of 38.1% of the GDP, respectively in 2008. The ICOR i.e. Incremental Capital Output Ratio was maintained till the year 2012 at the level of 4:1. ICOR is the ratio to know the efficiency of the investment. Higher the ICOR, lower the efficiency of the investment.

What went wrong in last two years?

This analysis will let you know real reasons of downfall in last two years. Such introspection hopefully will help the country, in reverting the trend as it would not be difficult for resilient Indian Economy to bounce back to the ‘Accelerated Growth Rate’ of 8%+.

As per old proverb, money makes money. It stands correct in case of Indian economy or any other economy.  When country started making money, habit of savings, made it possible to save. Saved money was rotated back into the economy. It therefore, means that any weakening of this cycle, will lead to breaking the momentum in the economy.  It is all that happened, post 2008. World economic crisis, led to low FDI, low sentiment in the corporate. General public which was happily spending the money a couple of months before crisis, start hoarding the money. Resulting into slow growth rate, in short.

Let us look at reasons more based on Economics theories. The capital in an economy primarily comes from three sources: household, corporate and government savings, called domestic savings. In last two years, available data shows that although not much change has happened with respect to household savings but other two savings i.e. corporate & govt have gone down drastically. India savings rate which peaked at 36.8% of the GDP in the year 2008, stooped to 31.3% in 2012 and again to 30.1% in 2013.  A big change was in the nature of household savings. It moved significantly from financial savings to physical savings.

This all made situation little complicated. Market saw short supply of fresh infusion. Further complication surfaced when supply of coal to manufacturing and power generation plants became a challenge due to cancellation of mines/litigation cases. Infrastructural projects which were backbone of employment generation, started spinning off the track. It resulted in negative change in ICOR that hovered at the level of 5.4% to 11.4%. ICOR is the index of efficiency of investment. It gives the indication that investment capital accumulated in projects is not yielding commensurate output. Overall domestic savings dropped to 30.1% and Investment Rate to 34.8% of GDP in 2012-13.  This is due to increase in the negative savings by the Government, the decline in profitability of private players and decline in net financial savings of households. The widening gap between the savings and investment rate, resulted in all-time high CAD of 4.8% of GDP in year 2013.

Furthermore, investment rate which is a function of CAD and saving rate bore the brunt at both the levels. CAD gone to unexpected high level and saving went down as mentioned above.

Future is bright for sure!!!

Green shoots however, can be seen in the Indian Economy in last couple of months. We have to water to make these shoots to grow into big tree again, together.

In last three quarters of the year 2013-14, the economy has grown by 4.9% rate. The manufacturing sector has started giving better than expected results. Picture of Agriculture sector is better than the year 2012-13. Food inflation which was turning out to be an issue of late has started residing in background. Economists are hoping to close the year at around 5% growth rate. Not bad at all, keeping the size of the Indian Economy.

Investment rate is still at commendable level of 30.4% of GDP, now. But, ICOR has to be brought back to the level of 4:1, as was the case till 2013.

Government however, has to work on retaining CAD to the level of 4.2 to 4.8% of the GDP. It has to further move out of populist measure like subsidies, no matter what. Keeping the disparity of ‘have & have not’, the government although has to continue with its subsidy measure, but it should be restricted to food subsidy and should slowly move away from others. The target should be to retain it at the level of 1.2% of the GDP from the current 2.2%.
Other specific areas for government to focus are:

i.              Infrastructure sector has to be made viable by infusing better liquidity. Projects which got de-railed of late, fist should be brought back to normalcy level. No further delays to be tolerated.
ii.            Some specific measures should be taken to make free agriculture sector from the shackles of uncertainties.
iii.           Power is another area which needs immediate attention. Any unavailability effects manufacturing directly.
iv.           Reforms need to be pushed forth with undeterred attention. Reforms in the following areas are already late beyond general comprehension:


a.   Land Acquisition
It has been a tussle point between general public and growth. Without easy land availability, how country, shall provide required land for infrastructural development.

b.   Environment
Fortunately, we have fuel for our required fire. We as a country are sitting on huge natural resources of coal etc. We need to be cautious & careful only to extract it as it is unfortunately available under our green belt. Although, some compromise has to be made while mining coal as these are available in dense forests cover of the country. Any unscrupulous action can lead to havoc to the environment.

c.   Governance
Governance is not only the responsibility of the government. Private sector has to take serious steps to ensure its compliance, as well.

d.   Labour Reforms
This is another area which needs immediate action. Economy today does not rest on steady requirement of labour supply. There are many employment opportunities which can be termed seasonal and therefore, these types of companies should be able to hire & fire as per their requirement. Adjustment to labour requirement should be made possible, as it is followed in countries like Germany.

For example, textiles industry is extensively labour intensive industry. Of late, India has started losing its importance, as countries like Bangla Desh came into fight as they have industry favouring labour laws. Flexibility of hiring & firing is available to them.


Looking at the trend of economic indices, India will shine again.