This is a mail by first year NITIE ( one of the leading Institutes for Management education in India) student:
O yes dear! Degrees do differ a lot. Engineering keeps us busy with Kirchoff¡¦s laws, Laplace transformations, Distribution curves blah blah blah. Sadly, we never use them on anything beyond pieces of paper. In contrast, a MBA is an excursion to reality; a confrontation with hideous facts.
Dear friends, in my 7 months of MBA education so far, I¡¦ve come across plenty of quite-disturbing truths. Each of these has a potential to stir a thinking mind. I wanted to document some of those and share them with you.
I hope you can spare a few minutes for them.
I hope you can spare a few minutes for them.
@ My first lesson was like a ¡¥wake up¡¦ alarm. Without ever realising it
I¡¦ve always lived on foreign brands. Right from the Farex which my mom
fed me many moons ago to the Reeboks I now wear; from the Colgate with
which I begin my day, to the Mortein which burns after I fall asleep,
hardly anything is Indian. Ditto for you.
I¡¦ve always lived on foreign brands. Right from the Farex which my mom
fed me many moons ago to the Reeboks I now wear; from the Colgate with
which I begin my day, to the Mortein which burns after I fall asleep,
hardly anything is Indian. Ditto for you.
¡§Wah Wah Globalisation¡¨ some might utter. But go a step below that
rhetoric and you¡¦ll notice the fact that we don¡¦t have a single truly
global brand of our own except Kamasutra and Yoga. Why?
rhetoric and you¡¦ll notice the fact that we don¡¦t have a single truly
global brand of our own except Kamasutra and Yoga. Why?
I¡¦ve identified some of the culprits. It¡¦s us ¡V the so called best
B-schools of the country. We slog day and night dreaming to be picked up
by the Goldman Sachs¡¦, McKinseys, E&Ys and other blue chip companies. We
follow the system too soon, forgetting to question it when required.
Perhaps we need a Munnabhai MBA who can think different. And until that
happens we will continue to eulogise dynasties like Tatas, Birlas et al,
but never see an entrepreneurial genius like a FedEx, a Dell or a Google.
B-schools of the country. We slog day and night dreaming to be picked up
by the Goldman Sachs¡¦, McKinseys, E&Ys and other blue chip companies. We
follow the system too soon, forgetting to question it when required.
Perhaps we need a Munnabhai MBA who can think different. And until that
happens we will continue to eulogise dynasties like Tatas, Birlas et al,
but never see an entrepreneurial genius like a FedEx, a Dell or a Google.
@*@ The next time you come across the ubiquitous blue coloured Parachute
Coconut Oil dabba, notice it carefully. Though majority uses it as hair
oil, it never mentions ¡¥hair oil¡¦ on the package. That brings us to our
next lesson -Play with the rulebook. It pays.
Coconut Oil dabba, notice it carefully. Though majority uses it as hair
oil, it never mentions ¡¥hair oil¡¦ on the package. That brings us to our
next lesson -Play with the rulebook. It pays.
Edible products are exempted from excise duty and also enjoy benefits on
sales tax. Therefore Marico/HLL officially promote their Coconut Oil
brands as edible products ONLY. By doing this they avoid paying excise
duty (16%) which maximises their profits.
sales tax. Therefore Marico/HLL officially promote their Coconut Oil
brands as edible products ONLY. By doing this they avoid paying excise
duty (16%) which maximises their profits.
@*@ Now some trade news. I assume you know that 95% of India¡¦s trade
happens through sea. We have 12 major ports in India. As per the last
Indian Ports report these 12 ports have TOGETHER handled 287.6 million
tonnes of cargo in fiscal 2001-02, which is lesser than a single Singapore
port (325.6 million tonnes) or a single Rotterdam port (320 million
tonnes).
happens through sea. We have 12 major ports in India. As per the last
Indian Ports report these 12 ports have TOGETHER handled 287.6 million
tonnes of cargo in fiscal 2001-02, which is lesser than a single Singapore
port (325.6 million tonnes) or a single Rotterdam port (320 million
tonnes).
Now you¡¦ll easily agree that we indeed contribute less than 1% to total
world trade.
world trade.
@*@ Manufacturing has lost its pride. Today a Babulal & Sons manufactures
the goods, a Ghanshyamji Brothers Ltd packages it and then passes it to a
Nike/HLL. These guys offer it to you with the w-i-d-e-s-t artificial smile
and rob you off thousands in the name of ¡¥customer delight¡¦ and other
concocted management jargons.
the goods, a Ghanshyamji Brothers Ltd packages it and then passes it to a
Nike/HLL. These guys offer it to you with the w-i-d-e-s-t artificial smile
and rob you off thousands in the name of ¡¥customer delight¡¦ and other
concocted management jargons.
You might think the profit pie is shared equally between all partners.
Take this. ..
Take this. ..
There are many small enterprises in Bombay who manufacture toothbrushes
and sell it to the big FMCG companies for anything between Rs.1.75 to Rs
4. These toothbrushes are then ¡¥brandedised¡¦ and sent to primary market
with a price tag ranging between Rs 11 to Rs 20. Can you visualise the
easy profits after removing the advertising and distribution costs? It¡¦s
whopping!! Btw, this toothbrush market is alone worth Rs 2000 crores in
India.
and sell it to the big FMCG companies for anything between Rs.1.75 to Rs
4. These toothbrushes are then ¡¥brandedised¡¦ and sent to primary market
with a price tag ranging between Rs 11 to Rs 20. Can you visualise the
easy profits after removing the advertising and distribution costs? It¡¦s
whopping!! Btw, this toothbrush market is alone worth Rs 2000 crores in
India.
@*@ Does price of a good always reflect ¡¥added value¡¦ inside it? Or is
the poor ignorant customer paying for something else? Let data answer this
question.
the poor ignorant customer paying for something else? Let data answer this
question.
Most premium goods use raw materials which are imported. They pass through
our ports which are grossly inefficient. The importers have to make a
freight payment which is a proportion of the total import value. The world
total freight payment is 6.2%. In India the figure is a terrifying 12%.
This obviously gets added to the basic price.
Also, we are always over-staffed. Mumbai port alone has 23, 600+
employees. Their salaries and wages amount to 77% of its operational
earnings.
our ports which are grossly inefficient. The importers have to make a
freight payment which is a proportion of the total import value. The world
total freight payment is 6.2%. In India the figure is a terrifying 12%.
This obviously gets added to the basic price.
Also, we are always over-staffed. Mumbai port alone has 23, 600+
employees. Their salaries and wages amount to 77% of its operational
earnings.
Who pays for these inefficiencies? The customer of course!!
@*@ After several years of deliberation a good thing is finally happing in
Indian Taxation System ¡V implementation of VAT. A little reading revealed
some interesting facts. VAT was first introduced in Morocco (1962) and is
being currently used in about 120 nations. In spite of many advantages
like general reduction in prices this bill faced huge resistance from many
traders. Guess why?
Indian Taxation System ¡V implementation of VAT. A little reading revealed
some interesting facts. VAT was first introduced in Morocco (1962) and is
being currently used in about 120 nations. In spite of many advantages
like general reduction in prices this bill faced huge resistance from many
traders. Guess why?
Because VAT mandates complete transparency. It requires traders to
maintain records of the transactions they make. Simply put, it makes pay
their income taxes which they have been evading since ages.
maintain records of the transactions they make. Simply put, it makes pay
their income taxes which they have been evading since ages.
@*@ How urban are our cities? Does urbanisation mean constructing
commercial centers, malls, theme parks or iMax theatres? What about
sanitation, public health, transport? Forget the cities, why can¡¦t we
ever ¡¥urbanise¡¦ an Indian? Why do men treat this country like an
open-air toilet?
commercial centers, malls, theme parks or iMax theatres? What about
sanitation, public health, transport? Forget the cities, why can¡¦t we
ever ¡¥urbanise¡¦ an Indian? Why do men treat this country like an
open-air toilet?
This is my first stay in Bombay and I¡¦m enjoying the love-hate
relationship with it. This city is the true microcosm of India. I¡¦ve seen
grandeur which can make any middle class guy gape. I¡¦ve also seen gauns
(villages) right here which made me chuckle. You¡¦ll be surprised to know
that in a mega-city like Bombay the distribution of kerosene still happens
through bullock carts. Yes, bullock driven carts fº Click this link.
relationship with it. This city is the true microcosm of India. I¡¦ve seen
grandeur which can make any middle class guy gape. I¡¦ve also seen gauns
(villages) right here which made me chuckle. You¡¦ll be surprised to know
that in a mega-city like Bombay the distribution of kerosene still happens
through bullock carts. Yes, bullock driven carts fº Click this link.
@*@ India got independence in 1947. Israel, a year later, in 1948. In the
last 50 odd years they have fought more wars than us. Had more bitter
enemies (Jordan, Egypt, Iraq, Lebanon and Syria) than just China and
Pakistan. Terrorism never let them breathe peacefully. Add to it severe
shortages of water, land and capital.
last 50 odd years they have fought more wars than us. Had more bitter
enemies (Jordan, Egypt, Iraq, Lebanon and Syria) than just China and
Pakistan. Terrorism never let them breathe peacefully. Add to it severe
shortages of water, land and capital.
Today, they are irrefutably more advanced than us in most departments. We
take their help in Agricutute (drip irrigation), Weather (artificial
rain), Defence (Phalcons, Tavor rifles) and even peacetime reconnaissance
(advanced UAVs).
take their help in Agricutute (drip irrigation), Weather (artificial
rain), Defence (Phalcons, Tavor rifles) and even peacetime reconnaissance
(advanced UAVs).
Where did we go wrong?
@*@ Lemme end this list with that fact which pushed me into writing this
mail. Every year, the World Bank comes out with a compendium ¡¥World
Development Indicators¡¦ which has rankings of all nations on various
parameters.
mail. Every year, the World Bank comes out with a compendium ¡¥World
Development Indicators¡¦ which has rankings of all nations on various
parameters.
The 2004 edition of the same has the World income map on its inside cover.
The map pictorially categorises 210 nations into 4 slots ¡V Low income,
Low middle income, Upper middle income and High income. Guess where we
stand?
The map pictorially categorises 210 nations into 4 slots ¡V Low income,
Low middle income, Upper middle income and High income. Guess where we
stand?
Low income; alongside nations like Ethiopia, Rwanda, Togo, Cameroon, Sudan
and other no-so-glorious names. How does it feel? Doesn¡¦t it feel worse
than losing the World Cup finals to Australia?
and other no-so-glorious names. How does it feel? Doesn¡¦t it feel worse
than losing the World Cup finals to Australia?
My dear reader, I can go on like this forever, but I¡¦ll stop here. I hope
you have got the gist of what I¡¦m trying to say. It will be a shame if
you think my sole purpose was to criticise or mock the system. NO. I am as
much a part of it as anybody else. My only motive was to make you aware of
the malaise around us. To make you ¡¥think¡¦ over some basic issues. God
willing, one of us will probably solve a few of those.
A departing note ¡V A country as great as India cannot be judged solely on
a few hiccups like mentioned above. Agreed, these are some aspects which
make us feel uncomfortable. But the fact that this nation braves to fight
this cancer is what makes us all proud. On some other day, I¡¦ll tell you
about innovative projects like Tripura¡¦s Rubber Parks or mighty moves
like the Iran-Pak-India pipeline, Kochi¡¦s Hybrid Port etc which have the
potential to affect even the last common man.
a few hiccups like mentioned above. Agreed, these are some aspects which
make us feel uncomfortable. But the fact that this nation braves to fight
this cancer is what makes us all proud. On some other day, I¡¦ll tell you
about innovative projects like Tripura¡¦s Rubber Parks or mighty moves
like the Iran-Pak-India pipeline, Kochi¡¦s Hybrid Port etc which have the
potential to affect even the last common man.
Before I sign out, I¡¦d like to thank my college for making me capable enuff to write this mail.
Praveen Gattu
First Year, PGDIM
National Institute of Industrial Engineering (NITIE)
Mumbai.
(praveenk.im11@nitie.edu)
PS: This mail is going to a lot of people from diverse fields. I¡¦d love
to know the ¡¥weak-links¡¦ in your part of the system. Thanks.
to know the ¡¥weak-links¡¦ in your part of the system. Thanks.
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