business mandate | january 2019 page 1 of 48mmachennai.org/banner/mandatepdf/mandatepdf25.pdf ·...

Business Mandate | January 2019 of 48


CONTENTS:

Flirting with Stocks Page 5

Dr Anil Lamba

Emerging Management Challenges Page 10 T Krishnakumar (KK)

SWITCH - Sales Transformation for Page 17

Strategic Advantage

Srinivas Uppaluri

An Overview - Politics of Economics Page 25

Dr T V Somanathan, IAS

Emerging Management Challenges Page 29

Prof G Raghuram

Emerging Management Challenges Page 35

Raju Venkatraman

AI: Reinventing Human Resources Page 38

Umasanker Kandaswamy

EDITOR

Gp Capt R Vijayakumar (Retd), VSM

LAYOUT EXECUTIVE

D Rajaram

SECRETARIAL ASSISTANCE

K Pandiarajan

Designed and Published by

MADRAS MANAGEMENT ASSOCIATION

Management Center, New No.240 Pathari Road

(Off Anna Salai), Chennai 600 006

Ph:044-2829 1133|mail:[email protected]

[email protected]

www.facebook.com/mmachennai

Printed at Shree Balaji Printers Pvt Ltd


From the Editor

Dear Members,

As we welcome the New Year in all its pristine glory, its time

to review and self introspect, the year gone by. A year in which

MMA’s flag kept flying high. MMA is fully functional at the new

Management Center – Temple of Learning & Wisdom. Happy

to share with you that all the MMA events are now organized

at MMA’s state-of-the-art MMA Management Center ensuring

value for money and great joy to our members. Thank you

members for your faith in us that made this achievement possible. Records were created and adding

icing to the cake is MMA winning the prestigious Award - Best Management Association in India for

the tenth time in a row!.

Nearly 27 years ago, India embarked on a journey of economic liberalization, opening its doors to

globalization and market forces. Today, the country has emerged as one of the world’s fastest-

growing economies, with the potential to emerge as the fifth largest economy in the world by 2019.

The Make-in-India programme enters its 5th year. We strongly believe that this is an active invitation

to potential partners and investors around the world. Several initiatives have been taken to improve

ease of doing business in India. The direct result of this was jump in India’s ranking from 130th to

100th all the way to 77th as of today and a 230 billion USD of commitment to invest in the next

couple of years, propelling us ahead of US and China in FDI. The success of Make-in-India initiative

was seen in individual states launching their version of this initiative to propel growth in their

respective states. Many resorted to innovative mechanism of marketing to attract investors and

create job opportunities. The world bank reports have categorically stated that quality of education

will sustain the Made-in-India Trust, as the vision is to attract more and more foreign investments in

different industries which require personnel and manpower to match with the pace of global

standards. There has been a clear thrust for quality education. We need a bit more support from the

corporates and management professionals to make sure that education sustain in Make-In-India

initiative. In this context, MMA is organising its flagship event – Annual Convention 2019 on the

theme “Future Forward: India Leaping Ahead” on Saturday, 16th February 2019 at Hotel Taj

Coromandel, Chennai. I would like to take this opportunity to compliment Mr Ram Venkataramani,

Chairman, Convention Committee, Convention Committee Members and our Knowledge Partner,

McKinsey & Company who are working tirelessly to design and conceptualise a great Convention

which will be addressed by a galaxy of distinguished speakers from all over India. Please do block

your diary and make it convenient to attend the Convention.

The world is in deep trouble. Average global temperatures have crossed a degree Celsius above pre-

industrial level and such concentration of carbon dioxide in the atmosphere has never been seen by

human beings. The recent Convention at Polland was meant to take forward steps to address this

threat of climate change. I strongly believe that International agreements on climate change are

mostly understood only by the signatories, and carbon issues by industries. Unless there is pressure

from the people to act on climate change, the governments may not act. For people to be aware they

need to be educated. MMA has planned a series of lectures/discussions in this regard and its the only

way Earth’s future can be secured. This is our last chance to fight climate change!

The indomitable spirit of Mary Kom, the legendary pugilist, deserves rich praise and plenty of

accolades. Her exploit in the ring are a source of inspiration for women and especially for young

students to emulate to exceed and excel. Another woman achiever – after loosing a number of finals,

P V Sindhu winning the world tour finals was the wonderful example of passion and perseverance,

especially as she is the first Indian to do so. However, let us not forget the contribution of Gopichand


for the making of not only Sindhu and many other champions on the world stage. We have invited

him to address the delegates during the MMA Annual Convention 2019. Lets hope for the best – he

will be able to make it to the Convention this time.

Let me know what you think about everything that’s happening at MMA. Send me an email at

[email protected].

We look forward to the New Year 2019, with a lot of hope and ambitious plans at our new MMA

Management Center. With your support we will succeed!

Happy Reading…. and a brilliant New Year!!!

Gp Capt R Vijayakumar, VSM (Retd)

Flirting with Stocks

Dr Anil Lamba

Best Selling Author and International Corporate Trainer

Founder Director, Lamcon School of Management, Pune

A Summary of the Address by Dr Anil Lamba during the talk on ‘Flirting with Stocks’ held on 12th

October 2018 at Chennai

Let me cover a couple of areas from the book,

a couple of anecdotes. The book is not meant

for people who are heavily into stocks. It is

meant for beginners. My belief is that

everybody should invest in stocks. I think it is

a national duty to do so. I have no vested

interest in the stock market and I am not a

broker; I am a Chartered Accountant and as a

hobby, I have gone into corporate education to

train a large number of companies across the

world. But stock market has always been close

to my heart, in the sense, that I always

encourage people to invest. I even used to run an event called “Invest Fest”, probably the largest

event in the country, run for 12 years, from 1992 to 2004 including in Pune and Dubai. Also after

the Harshad Mehta scandal, when people started running away from stock market, we wanted to do

a social contribution as to how to get the people back to the stock market. So, I designed a game

called “Stock Scan” where everything was real except the money. Now it has become very popular

in websites like Money Control. But I am talking about 20 years back. That game became popular all

over the country. So, I always had a kind of inclination towards saying that everybody should invest.

The reason I say it is a national duty is this; imagine I come to all of you and tell you that I have got

this wonderful business idea but I don’t have the money, you people have the money, why don’t you

invest with me and we will all become very rich. Invest with me and I will return it to you, multiplied

many times, 25 years from now. Would you be interested? What will put you off is 25 years from

now. You may say, I have money, I can invest now. But what if I need it next year, or two years

down the line? Now imagine I came to you and said, “I have this great idea. Invest with me and I

will give back your money whenever you want it”. Would you not be far more inclined towards

investing? This is what the stock market does! When you have the money invest. When you want


the money, call the broker and say you want the money back. You may get a little more or a little

less. But now if you call your broker and say, ‘sell my shares’, and the broker goes to the stock

market and there is nobody to buy. Gentlemen, it is important that the stock market is teaming with

activity. When all of us decide to invest in shares, what happens? The stock market is a very busy

place, there are hundreds of thousands of people buying and selling and consequently anybody who

wants to sell can find a buyer and anybody wants to buy can find a seller. When buyers and sellers

find it easier to find each other, more people are inclined towards investing and when more people

agree to invest in stock market, more entrepreneurs are born. Entrepreneurs are wonderful people

with lots of ideas, but may not have the money. Those people find it easier to raise money. When

more entrepreneurs are born, more industry is created, more employment is generated and more

GDP is added. All that started, why, because you and I said, let us invest in the stock market. That

is the reason I think it is a national duty and probably the reason for my motivation and passion in

stock market.

This book is for people who have never invested in stock markets. Many people want to invest but

they don’t know how to go about and finally they do go, but they go through Mutual Fund route. Of

course, it is no harm, rather than not going, that is the best thing. But ideal is that you start investing

yourself. Then somebody says, “Tell me what should I know to become a successful investor?” To be

a successful investor, all you need to know is two things: You must understand WHAT and you must

understand WHEN. What to buy and when to buy & when to sell. Is “what” more important or “when”

more important? Let me rephrase. Is it more important to buy a good share or is it more important

to buy it at the right time? Let me rephrase again. Is it more important to buy a good share any

time? Or is it more important to buy any share at a good time? I think, ‘when’ is more important

than ‘what’. Of course both are important. Ideally buy a good share at a good time. But if you have

to choose between the two, then “when” is more important. For example, how good a share is ACC?

At one time it was one of the most favourite stocks. Had you bought ACC before the Harshad Mehta’s

scandal, when it touched about Rs. 15000, even if you hold it for rest of your life, it will not touch

that price again! What is the point of buying a good share but at the wrong time? But on the other

hand, you buy a piece of junk, if you get in at the right time and get out at the right time and you

will probably make money out of that share. In the book, I go on to explain how to choose ‘what’

and how to choose ‘when’. If you can take care of these two things, most of your problems are taken

care of.

Having said that I don’t make money from providing stock market services, let me correct my

statement. Long, long back, when I newly became a CA and had developed a new-found interest in

stocks, I used to invest myself in stocks quite a bit. Those days, I had a friend, who was a sub-

broker. I think two things happened fortuitously. He was a sub-broker, but one of a cerebral kind.

He would give lot of information and was well-read. The second coincidence, a good thing happened

was that I owned a P.C. (Personal computer), I was one of the very few chartered accountants to do

so! I owned a PC but did not know what to do with it! We used to play games on it. These two things

came together. I will tell you how. My friend with whom I used to chat about stocks, when to buy,

where to buy and so on, we both came out with a brilliant idea (if I may say so myself)! We started

providing Portfolio Management Services, providing personalised tax-linked advice. How was it personalised? Very simple, we

had a Personal Computer! It was a subscription based scheme. You join in, we will take details of what shares you have and key

it into data base. The friend of mine would study the market and come out with recommendations as to what should be

bought. What should be bought applies to everybody. We used to send a newsletter recommending

the list of shares to be bought. It also contained shares to be sold if we think they are over-priced.

For selling, our database would throw up names of clients who possessed those shares. If we know

you have Reliance for example, you will get a phone call. This was the way it was personalised again.

They were tax-linked because I was a practising CA. I would probably take the capital gains

implications into account and tell him, “We are in mid-March. Why don’t you hold for 15 more days,

it will probably reduce your tax liability?” This is how we used to work which was the first of its kind


then. We started a company. Those days, my friend used to recommend a stock of a company called

Mazda Leasing. Some of you might recall. Those were the days when leasing was becoming popular.

There was a company called First Leasing initially and then came Mazda Leasing. My friend was

recommending “Buy Mazda” which was trading at around Rs.15 to Rs.16 and it was “tipped” to touch

100. We were just not telling people to buy. We were staunch believers of our own recommendations.

Not only did we tell people to buy, we were buying ourselves. Next News Letter came up saying

Mazda had gone up to Rs.25. Again the recommendation was “to buy Mazda”. By next News Letter,

it touched Rs.40. Again “buy”. Then one of those stock market crashes came. When stock markets

crash, everything crashes whether it deserves to crash or not. When a boom comes, everything goes

up irrespective of its worth. So smart investors, when a crash comes, pick up those gems which are

under-valued and when a boom comes, there is an opportunity to get out of the junk that you

collected along the way. Good old Mazda settled around Rs.6! I realised this was a big mistake and

I did not want to be in this line. We got out of the business and since then I have never ever provided

any stock market services.

For my personal portfolio, we had a very

crude system. I had a full-scape sheet.

Vertically all the names of the companies we

hold and horizontally the prices at which they

are bought. For one month one sheet.

Somebody in the office would mark the daily

prices. Then after some months, if you see, at

a glance you can find out whether the share

price has gone up or down. Mazda for years

together was steady at Rs.6. One day I found

out Mazda had moved up to Rs.8, followed by

Rs.10, on the next day and 12 and then Rs.15.

Next day, I received a letter from Mazda, they had a Rights Issue, offering a Rs.10 share for Rs.10

to existing shareholders. Who will buy the Rights Issue of Mazda at such prices, when the share was

trading in the market below par? My thought was that the company must be rigging up the price

with the hope that the Rights Issue will succeed. The Rights issue forms were torn and thrown into

the bin. I remember Dr. Chopra, Founder Director of Symbiosis College was sitting in my office that

day and he saw the Mazda letter on the table, he asked, “Do you too have Mazda”? I said, I tore the

Rights forms. He said he was also going to do that. Everybody probably did that. I am trying to tell

you the lessons to be learnt by assumptions. Then Mazda continued to rise from 15 it became 18, to

20, 35, up to 45 and then it fell a little. He said, I recovered most of the investment and let us not

be greedy. We sold half of my holdings. Mazda started rising again to 45, 60 up to 75. Again a little

dip came. Now I said, enough is enough and sold the entire lot and got out. Mazda started rising

again to 100, 200, 500 and went up to Rs.1600! Mazda was rising because Harshad Mehta had

bought into the company. A little research would have shown that. I was talking to a friend of mine

around that time. The stock markets were booming at that time and normally conversation goes

towards stocks. He was a leading architect in the town. I asked him whether he was investing in

shares and he said no. He said, he is holding some shares which I recommended many years ago

and he opened a drawer and found about 500 Mazda shares! He was holding 500 Mazda at Rs. 1600!

When you monitor every day, you sell it at Rs.40 or 50 or 60! This is one of the interesting things

that happens in the stock market!

Let me throw some light on what is written on the back cover of the book. When you buy shares on

grounds of safety, you don’t guarantee safety but you guarantee mediocrity of returns. What does

that mean?


I can run you through two identical companies with same volume of production, same product, same

cost and same everything. But suddenly you may realise that in one company compared to the other,

you could have probably made 10 times more money. Then when I point out how much more

profitable this company is, somebody would get up and say, “This is also very risky”. It is undoubtedly

risky. I never said it is not risky. I only asked you which one is more profitable. There is an established

correlation between risk and returns. High risk, high returns. When I recommend still going into

stocks, the natural reaction is: Why you are asking us to take risky investments? My point is

gentlemen, if you don’t want to take risk, don’t come to stock markets. People finally decide to invest

in stocks and then they try to be as safe as possible. In that case, stick to debt instruments , don’t

come to stocks. But even if you choose safety, my next question is: “Are you sure that the company

that you think is safe is really safe?” What do I mean by that? Had you asked the finest brains in the

world, (by the finest brains, I mean the Merry Lynches and the Goldman Sachs of the world) in the

month of October 2001, “What is your opinion of Enron?” Without exception, everybody was saying,

1). there hasn’t been a company as good as Enron in the entire 20th century”. 2). Without exception,

they were putting a “Buy” recommendation against Enron. In December 2001 that company did not

exist anymore!

My point is, are you qualified to judge safety? People go to great lengths to take investment decisions

on grounds of safety when they don’t understand anything about safety except the spelling! When

you choose investments on grounds of safety you are not guaranteeing safety, gentlemen, you are

guaranteeing mediocrity of returns. Or when you consciously take risks, the returns are also

proportionate. Therefore only put that much money in stocks which are risky which you are willing

to lose. That amount is not so big that it will make a dent in your life style. But on the other hand if

you do make money, probably you will make more money on that, then you have made on the rest

of your investments put together.


Emerging Management Challenges

T Krishnakumar (KK)

President, Coca-Cola India and South West Asia Business Unit

A Summary of the Inaugural Address delivered by Mr T Krishnakumar during the 17th MMA All

India Management Students Convention 2018 on 25 September 2018 at Chennai

It is an honour and pleasure to be with you

here today. One of the major reasons for my

coming here today, is to see all of you because

about 35 years back, I was sitting there as a

student where you are all sitting now. Even

now, when the Secretary of MMA referred to

me as Chief Guest, I was looking who the Chief

Guest was! I have still not got over the student

within me! You may expect me to talk a lot of

about Coke, but I am not going to talk anything

about Coke because I am here to share with

you what I have experienced in the corporate world. I started this journey of moving out as a student

of a Management Institute to a practising leader in business. I don’t like the word “Management” per

se, because it sub-optimises of what you can do in life. You all know that our life is beyond managing

resources including people. So, I am really going to take you through some of what I believe are the

differences in the world we operate in, between when I started working, to what it is today. I believe

the world has been a fantastic place for all of us, but, things have continuously changed, and they

are going to continually change as Professor Raghuram alluded to.

I think this journey you are embarking on is great. In fact, I feel envious of you. When I started my

working life, India a large country, was regulated by licenses; there were two players in every

category; there was one TV channel; you could maneuverer on your TV Channel and you had done

your marketing and if you had a license, you were into business. I think India has gone through the

most dramatic change in the last 35 years, than any other part of the world. I believe that today,

what is great for all of you is that, India gives you equal opportunities as any other part of the world

and what is happening elsewhere. I don’t really feel great about people moving out of this country

as this country provides an opportunity unparalleled in the world today.

With this preamble, let me spend some time taking you through some of the complexities of emerging

management challenges. I believe that it is important for us to recognise that the world in which we

are operating has definitely changed during the last two decades and even faster in the last 5 years.

It is not that change is new. Change has always been there, but the speed at which the change is

happening now, is what has changed. All of you know that when change is accelerated, then the

rate of changes in inputs and initiatives we need to adopt, are also different.

Despite the slow change of curriculum in the context of Indian management education, words like

“product” and “Brand life-cycle” would have changed so much, that entire topics should be re-written.

The expectations of consumers have undergone massive changes across the world and for the first

time you have consumers in India, who really don’t want anything different from the rest of the

world. I still remember the day when I got my first car and I had to wait for two years after paying


the advance to somebody; then that guy would come and give the car and if you find something not

right with it, they would say, “Sir! This is what is available now. You take or else wait for another six

months”. Today you can aspire to drive the same car which is from USA or Germany. So that is the

kind of change you see in consumers’ aspirations today.

Technology, including digitisation, is bringing in disruption and obsolescence almost overnight. All of

you would have heard of the “Kodak moment” where Kodak, a very successful company, a leader in

its category of business just vanished from the face of the earth. Believe me, this is the fate which

is facing multiple organisations and most of them don’t even realise it because very few people are

foreseeing the change at the speed at which it is going to happen.

So it is important, and it is as important as when you cross the road, you look on either side, you

see a car and you estimate the speed at which the car is coming almost in an instinct and then you

cross the road thinking that you will beat the car. Imagine if you make that mistake, what happens

to you? It is fatal! The same thing is happening to businesses. Businesses which are not anticipating

change at the speed at which it is going to come, are going to perish because it is the same as what

happens to you on road.

When I started my corporate career, life was relatively simple. You had a shareholder and the

shareholder was very keen that you deliver on their investment. So you had one metric, Return on

Investment (ROI) on the capital. If you are a public limited company or promoter- driven company,

they wanted to know what the return on their equity is. Period. So you did everything to maximise

one metric. Today if I see our corporate scorecard, my head spins because half the metrics you

cannot even quantify and at times control fast enough. Because the whole purpose of business to

drive shareholder value has been complicated by every stakeholder involved in the business, the

communities, the government, and every person in some way responsible for your day-to-day

operations. So, the whole concept of delivering value has gone through dramatic change. As if this

was not enough, we have two serious challenges and we have to be very humbly careful about them.

Irrespective of whether you like it or not, whether it is scientifically proved or not, climate is changing

and I have seen it as somebody who has born and brought up in this country and most of the time I

lived in India, I can see weather patterns dramatically changing. The phenomenon is real; and the

fact is that we are over-exploiting resources of the world.

Second is poverty. Whether we like it or not, give or take, one third of the world is poor. This actually

has a serious bearing in the way we do business because, we cannot be generating value without

really handling these two problems. This adds to the complexity of the journey that we undertake

in our professional lives.

Professor said the VUCA world already existed. Yes, it did exist. When I joined my first job, for 15

years nothing majorly changed. Today, every 15 days, things change! That’s the difference in the

pace of volatility, uncertainty and chaos. What was changing once in 15 years then, is changing once

in 15 days today. So, it is still a VUCA world, but it is changing at a very rapid pace.

And one of the key things that you need to really understand that this VUCA world is even more

getting complex. All my first 25 years of worklife, everybody talked to me about the borderless world.

Many books were written; they were all about globalization and the world is going to be one ‘free

economic zone’ and everybody was going to really have seamless fun. It was really like a fairy tale.

With economies of scale and ability to mass-standardise, suddenly the fight started. The order of the


day for the first 25 years was: how many free trade agreements that the country is going to have?

From there, we have now moved to: how many countries are going to fight with each other and

create local tariffs to block business? I think the world is very complex today because there is no one

single undercurrent which is driving the world. It is being driven in multiple ways by multiple complex

forces and undercurrents at play.

In India for instance, we had a dramatic change. When I started work, we had around 35 local taxes;

we had different types of central taxes; we had manufacturing tax, we had sales tax. Today we have

one single tax regime. India has achieved today what the world said, “It would be a free, single

marketplace”. India has a single marketplace and this is changing India.

I remember way back in the 1980’s, India had very few developed states which were developing

ahead of the curve. But today with the kind of opportunities on account of change in taxation and

the emergence of other parts of India, you finally have many states coming to the party in terms of

a single seamless marketplace.

In fact, just to put it in perspective, the way India’s population is moving, we would be literally 22%

to 23% of the global population. I believe an Indian job would be more global and diverse than many

global jobs today. Because ultimately, the marketplace is defined by population and I am sure you

will all find this exciting prospect of slices of the world coming together in India.

When I used to think of business in those days, the whole paradigm was really different; you thought

through, you analysed, then you got in, you did a small pilot, then scaled up to a larger pilot and

then did a big business. Today the mindset has moved dramatically. It’s all about a “quick start and

rapid scale-up”. This is the world where everybody is connected and if people come to know that

there is something new coming in, they can neutralise it pretty fast.

So if you want to really delight consumers and get the first mover advantage as they say in industry,

it is important for you to have the ability to think and appetite for rapid growth.

In fact, with the shortening of all these processes, even big organisations like ourselves, we have

two approaches. We have a different approach for our core which moves in a normal business process

model of “slow, start, pilot and grow” model. We have another approach which we call “Incubator”

where if you get an idea, we can execute the same within 12 weeks of the idea in the market place.

Then we study, correct and are able to scale up very fast. We believe that if we don’t have these two

types of thinking, we will not be able to get on to our growth trajectory. So every organisation is

trying to at one level create a culture with this lighter start-up model.

While I like the whole concept of business end-to-end, the most important change in my view, is that

innovation has changed because the time you have to leverage innovation is very short. In fact

digitisation has destroyed entire product categories.

Going back to the Kodak example, as a company, it was a well-run company. They followed every

good practice. The only thing they missed was that the innovation could destroy their category. In

fact, they were the first to invent the digital camera, even though they were the leaders in

conventional camera business. They invented the digital camera, but they never thought that this

innovation will quickly take charge of the world. What happens today with any innovation? Once you

get into innovation, a whole lot of people try to get in and improvise around your innovation. The

key factor for success is not who scales up the innovation. It is about who democratises the

innovation.


So what happened in the case of digital camera? It got so democratised that every mobile phone had

a camera. That is what I believe is true democratisation. Today’s world is all about how you

democratise an innovation; how you can take an innovation quickly and drive it across the 1.3 billion

people in India or eight billion people in the world. The first one who does that generally gets the

cake; the rest of the people are left to really have whatever is left over in the plate. So it is all about

who does it first.

It is no longer about who does it perfect. I can tell you the first few smartphones really hanged. I

had my nephew who used to work for one of these companies. I used to call him and ask him what

is happening with the phone. He used to tell me, don’t worry uncle! It has a problem because we

were told to quickly turnover the software. We will correct in the next version! So, it is no longer

perfection, it is fast and democratisation of an innovation in the market place.

I don’t understand much of technology

except that it changes everything and it

disrupts the world! I think we should, as

students of management, be able to

anticipate what technology is going to do.

You need not understand everything

about technology but you should be able

to really understand what it can do to your

business and all other businesses

adjacent to you.

It has the ability to speed up; it has the

ability to disrupt; and it can increase

productivity. You have all sorts of bots today – robot programs that operates as an agent for a user

or another program or simulates a human activity – and everything is automated.

I was in the Bay area and I found that they have automated their front office. There is nobody in the

front office. Today the front office can be managed by a bot which can do much better than any other

humans. That is one area. Then more advanced technologies have the ability to segment and

customise.

If you are in the US, and you want a specific beverage of Coke and it is a mixture of 10 different

flavours, you can actually program it and before you go to the outlet you can just use your mobile

phone to send the message to the machine and when you go to the outlet, you just press your button

and you get your beverage. That is the level in which technology is disrupting things today.

In fact, AI is moving so fast that it can even identify your preferred choice and correct you if you had

chosen a wrong flavour. That is what technology is doing to businesses today. Not only is it doing it

in consumer spaces, but also for Supply Chain. Today Supply Chain has become super-efficient

because you can really automate everything you want to really do. Therefore, you have one more

dimension which is constantly be aware of what is happening on the technology/ automation front.

I mentioned about “Multiple Stakeholders”. It is a very important thing which you have to remember.

I personally believe that sustainability is at the core of everything. In fact, many consumers, you

would be surprised, would want to know what your basic philosophy in sustainability is, before they

buy your product. This is something which is unheard of 30 years back. Secondly, it is important for


us to recognise that even though we manage corporations which are for profit, it is very important

for us to recognise that when we do well, the communities around us have to get positively impacted

by our doing well. Because, if you don’t do that, you are not creating shared value and you will lose

your right to exist at some point of time because of irrelevance.

I think we really need to make a difference to the community that we operate in. In fact, one of the

big programs that we have launched in Coke is called a Fruit Circular Economy. I don’t know how

many of you are aware that India is the largest producer of fruits and vegetables in the world. So,

we have created a 360-degree program where we will work with the farmers to improve their

productivity of fruits both in terms of per hectare yield and per fruit quality and try to help them

create demand by producing beverages. We call this the Circular Economy as we believe that we

have to make a difference in our own small way to our economy.

At the same time, I want to state that for the economic value creation, the engine is still on. There

are series of opportunities in terms of consumption goods and services. In fact, emerging economies

are going to drive demand which is something that global companies are grappling with, because the

business shifting to the emerging economies. The emerging economies’ business models are not

exactly a replica of what they do in the developed world. If you do not find a right model, you are

not going to be able to deliver value to your shareholders.

I have heard many people saying that “We have succeeded in Australia. Why not in India?” India

needs a different business model. Professor Raghuram talked about Bottom of the Pyramid. If you

want to really get business from Bottom of the Pyramid, you have to have a different business model.

You have to create a business model that works. People say it is Jugaad in India, but whatever it is,

you need to have a model which works for every market. So this is where your roles and opportunities

are going to be fantastic. You have the opportunities for creating models for the emerging world

which are still not really institutionalised.

I don’t want to go without giving some clear thoughts.

The first important lesson I learnt in my journey is: Stay relevant. Most of us forget this word

“relevance”. If the world is changing so fast, the consumers are changing very fast, your stakeholders

are changing very fast, and your employee’s aspirations are changing very fast. How do you be

relevant to each of these constituencies? It is true even in the family. I work hard to stay relevant

to my children because they are in a different space and I was brought up in a different space. The

first mantra is: everyday wake up in the morning and ask yourself or when you go to meet people

on business purposes, “Am I relevant still?” Most of the times, relevance involves learning new

things. The solution does not lie in what you learnt till yesterday.

Second mantra is my favourite one. Move to “backcasting” The forecasting model is definite ticket to

failure today! Because the world tomorrow is not going to be exactly the world of yesterday. It is

going to be quite different. I have learnt this word from multiple sessions I attended. You ‘backcast’.

You predict the world what it is going to be in five years from now and do something today which

will be relevant for the world which is going to exist five years from now. Forecasting was good when

the pace of change was slower. When the pace of change is being really fast, you need to really start

looking at ‘backcasting’.


Third mantra is that you have to develop the ability to manage rapid change. I realise that your

mobilephone version keeps changing every six months. I find difficult to handle my new mobile. You

people are good at it. But this is not enough. Rapid change brings stress along with it. All of you will

be part of a larger system and to keep that system going at that pace is a capability you have to

build. Digitisation will be necessary as part of what you do. It has its pluses and minuses. The plus

is that is the way the world is and you don’t have a choice. The minus is, by digitising you really are

very transparent and so you can be disrupted easily. Capital is the scarce resource, I believe the

world is not going in the right direction in terms of capital. I am not a great propagator of spending

large money which is not backed with real assets. When capital is scarce, it really devalues the world.

Sometimes the one thing that keeps me awake in the middle of my sleep is the way capital is being

deployed in the world in many ways.

The last mantra which keeps me highly positive and top of the world is: there is always a way to

grow business. I have had many people working with me who had the syndrome of “sky falling down

when things don’t work”. I don’t get into this syndrome. With this syndrome, you will be pulled down

when you are in a corporate world. Whole lot of corporate managers ended up managing what is

called “budgets” for many years. I call that a cancer because what relevance is there with your

internal plans and budgets, with what happens in the market place? I think you have to be market-

focused and if you are treating the consumers as sacred, there is always a way to grow. If you are

the person who has discovered the way to grow, your life is made! If you are otherwise and one

among the corporate citizens who are pulled by the “sky falling down’ syndrome, you will only be a

log of wood which will float when everything is fine and when things are bad, you will get the pink

slip.

One of the big traits I personally believe is that “Always think like an entrepreneur”. This entrepreneur

thinks 360 degrees. Always look for an opportunity to make things work. But act with accountability.

Many of you may be in start-ups in future. You may not have adequate financial resources and you

will be responsible to multiple stakeholders. Always have a long-term vision but achieve goals in

short sprints, because you have to break the long-term visions into parts.

Finally, keep your mind agile so that you can think on your feat of better and more sustainable ways

to grow.

To sum up, the world is still in positive territory despite all the noise you hear. I don’t read

newspapers often. When you read newspapers you hear lot of noise as though the world is coming

to an end tomorrow! You always put on your filters to ensure that you cut the noise and see the

opportunity.

Be relevant, be humble. You have to learn a lot from people working around you. So retain your

humility which is a great virtue. Be conscious of your role in creating sustainable communities as you

do your business. It is our role as management graduates, to build a sustainable community because

you are a privileged lot in this 103 billion population. I stand back and pray to God that all of you are

great citizens of our great country who can realize India’s potential and take it to its peak of success.


SWITCH - Sales Transformation for Strategic

Advantage Srinivas Uppaluri

Former Global Head of Marketing, Infosys

Author, Advisor and Leadership Coach

A Summary of the Address by Mr Srinivas Uppaluri during the talk on the theme ‘SWITCH - Sales

Transformation for Strategic Advantage’ held on 28th September 2018 at Chennai

This book has been divided into three themes

which I am going to cover in this session. For

each of the themes, I will turn to the panel

members and ask them to share their experience.

One of the things which always intrigued me is

the need to be successful at all costs. If you see

this particular cartoon (I purposely dramatized a

little bit), somebody in 1996 selling Cloud

solutions which was obviously not there at that

point in time. A client is asking for Cloud solutions

and the sales person says, he has that feature to sell. The sales man got the contract and he also

got the bonus. Subsequently when the consulting team which had gone there was unable to

implement it because obviously cloud services never existed at that point of time. In this the question

that everyone needs to ask is: Who is the winner? Is the selling company the winner or the buying

company the winner? Neither. We always are having the salesmen as the winner. Many times, I

think, for the success of the salesmen, the purpose for which the companies are formed are

destroyed.

Many of the companies in this room are formed to address a particular market situation. But because

you have this regular pressures, you allow the salesmen to respond in this way. So the question I

want every one of you to reflect about is: the pressure of targets is compromising the core purpose;

the core purpose for which a company is set up is always compromised because your quarterly short-

term results become more important.

Many times, the executive score cards have too much weightage towards finance. It is not about

customer satisfaction, it is not about customer relations. Therefore the whole sales process becomes

very tough.

How many of us go to a showroom to buy something and you are immediately attacked by the

salesmen walking around you whatever you are doing and not allowing you to do your minimum

browsing? Sales always tend to be aggressive, intrusive and almost desperate. They want us to buy;

they don’t allow us to make our choices.

Lastly, most of the people exist for the short term gain. In a B2B relationship, always it has to be a

long term. The sales struggle because you move away from that core; that core that you need to

work for the success of your customer, the core that you have actually created a product or a service

because there is a market gap. You move away from the core and focus on short term basis. I think

there is a great problem in sales because B2B is never going to be for short term. If you manage it

once and succeed, it may not happen but you cannot sustain in the long term. So, the fundamental


shift I propose in the book is to live the larger vision of the organisation. The struggle is always

moving away from that objective. As long as your larger vision is to serve that market need and you

stay long term, you will have a consistent, more predictable and perhaps a very successful sales

organisation. That’s the fundamental shift that I talk about in this book. I talk about it with three

broad themes.

Theme #1: How do you transform your attitude and approach towards the customer?

Theme #2: How do you transform your engagement to the customer?

Theme#3: How do you transform your sales management?

But central to all this is ethics. Are you selling something that customer needs. Are you selling

something which is useful to the customer? Are you making money through values? One of the best

things I always like about Chennai for its a strong culture of value and ethics. Perhaps, this is the

only city I see in this country which is very much grounded and always sticking to that core and

perhaps this is a very nice place to come and discuss this book here. So ethics is always central to

your success. I will touch upon each of these themes and turn to the panel for their experiences.

Transforming Attitude and approach towards the customer

How many of you have browsed any company’s website and there is automatically a pop up saying

“Do you want to meet my salesman?” All of us have this experience of whatever website we go to.

I go to some conferences, and you see people selling their wares. I would have probably gone to

such conferences understand something new. Finally, they start ending up landing at your desk

saying that “I have seen you downloading a paper or seeing product and “do you want to buy this

product?” It is all about the immediate need.

I do a story in this book about somebody trying to put IOT into their product. To do that, there are

multiple layers of things to do for which you have to understand in terms of sensors, in terms of

networking needs and in terms what kind of data need to be crunched and so on. For a company,

there is a need to put a business case internally. To do that, they start going around in the market,

trying to understand what the trends are, how best way they can engage. It is a long process. Are

you educating the customers in this process? Are you holding their hands to put the business case?

That is a fundamental shift.

So the question I want to reflect upon is: Are you as a company playing the role of an educator to

the market and customer? Or are you pushing things? Your product and services may not fit the

larger picture. I told you about the IOT. You are only selling the big data or sensor alone. But it has

to fit into the larger picture. Are you helping them to fit the larger picture? I worked at a large IT

company where one of the customers we had, was a global MNC. It took us two years to probably

get them comfortable with outsourcing. We met them in some conferences, we started nurturing

them over the period of two years, helping them to feel comfortable about outsourcing, go back to

their organisation and put a case. So everywhere the need to educate the customer has become very

critical. How are you supporting them in the process of putting a business case? These are the

questions I would want to reflect about your own organisations. If you continuously start playing that

role, you have a much better chance of building a longer B2B relationship.

The other point is about conferences as mentioned by Group Captain. There are lot of conferences

happening. They create communities. They champion issues. How many of communities you are

part of, how are you engaging with these communities? How are you championing with these

communities? In terms of building mindshare and education, what extent are your driving it from

campaign approach? This is another issue which is very important. The last very important thing is


campaign orientation. Many of us do ‘one-off’ events. I was advising a start-up company which got

a Series-A funding and they go and splurge that funding on the marketing only through events. You

go to several events and you don’t end up getting the right people buying your idea. You have to

build a campaign around it. You have to have a continuous long 18-months or 24-months campaigns

and nurture the minds of the people. The idea is how you build that kind of a campaign-orientation

and build that kind of right community around you. If you look at the B2C world, advertisements are

done on a sustained period of time. It is never done one-off. That’s what the time taken to build a

campaign. Campaigns are always long. One-off events or one-off touch points with the customer

does not work. The key take-away is that you should be willing to nurture your customer to assess

and getting ready for your product.

I want to take up a case from this cartoon. All of us want to escape from our work at some point or

other and we find pleasure outside the work. We find pleasures somewhere else. We don’t find

opportunities within our own selves. We don’t find opportunities that we can create for our customers.

Such people are always looking forward for holidays. They challenge themselves in this particular

story, how they find opportunities within their work; how they can transform experiences. They are

all doing routine work. They are probably doing ‘menu-card’ sales. How by selling from the menu

card sales, they can create opportunities for their own customers? Finally the transformation happens

to them when they start finding opportunities.

The full approach of “how I can look within to start finding better solutions for the markets” is another

attitudinal shift. Am I creating opportunities? This does not happen at individual level. The questions

to reflect upon here is: Are we selling on features or outcome? Many of us sell products. Even if I do

the most sophisticated product, if I don’t sell the outcome, but if I only sell the feature, there is

always a problem. So, am I thinking ahead of how the customer is going to put it to use? In fact one

of the best lessons I have learnt from Tamil Nadu early in my career in LMW in Coimbatore. They

had the textile machineries which they used to ensure that their customers put it to use and they

get the best out of its features. They always stayed ahead of the needs of the customers; they never

wanted a particular customer buy a product who will never put it to use. They always ensured that

the customer is getting the best value out of the product. So, are we selling features or are we selling

outcomes? Give the competitive edge to the customers. As I said in the LMW case, they are always

willing that their customer gets the best out of it and then he is getting a competitive edge out of it.

This is not done at the individual level. It is at the institutional level.

It is not that a single sales man or single account manager who can do this. Organisation has to

support. We have to make investments into it. How do you stay ahead of the customer needs? I have

a colleague from my Anderson Days. In Anderson Days, it is always said, “go and tell a customer

what improvements we can do continuously” and that was the mind-set. I could never sell features

to them. Always have to create an opportunity which gives the competitive advantage for the

customer. Institutional investments are being made to stay ahead of customer need.

Finally, “How are your executives measured?” If you do all this and if your measurement is only on

the next quarterly results, it will never happen. The culture should be that ‘this is important that you

create opportunities for the customers”, and that ‘this is critical that the customer comes first”.

Unless the executives are measured on that, it will not happen. How many of us have experienced

different telephone services provided to us where he chases for bills but never pick up our calls for

any faults. They are not measured by customer satisfaction. They are only measured by how many

sales they have done or how much outstanding bills have been collected. It is a cultural issue. It is


an institutional thinking of customer need ahead. It is another important shift in terms of creating

opportunities in thinking ahead of the customer needs is what the second change.

Last one is building trusted relationships. This cartoon is very interesting because I play golf and

many times I meet strangers on the golf course. Within the second hole, they would try to give me

a visiting card saying “I do this service” or “I sell this product”. I go there to enjoy by playing golf as

I pursue that very passionately but these people come there to see me as an opportunity to sell their

products. Trusted relationships don’t build if you don’t have common passion for the same thing. In

my case, since both of us are golfers, over a period of time we could build the trust with each other.

Same thing works at the company level. If I don’t go and present the right commitment to the

customer, and don’t think ahead of the customer needs, there is no trusted relationship built between

us. The questions we need to reflect about is: “Are you having a common passion? Is the customer

looking forward to your visits saying “Are you the sounding board”? You may be selling your

machineries here but is he looking forward to your visit because it will help him to put the product

to better use? You can tell him the new trends in the market and how you can improve it. Is the

customer satisfaction central to your existence?

In one of my consulting experiences, I thought I did a fantastic transaction with the client. I delivered

a value beyond what the client was expecting on the transaction but when they took a feedback

about me, the client gave the feedback saying he did not look forward to my visits. He said, I come

only for the transaction and therefore there is nothing to reflect upon my services. He said, I visit

him just to update the transaction. Many of us are caught into the transactions. We are not caught

on to thinking long-term relationships with the customers.

We used to do in a unique way of building common interest at one of my earlier companies. We used

to go to the World Economic Forum and our CXOs were present there as somebody who champion

on global issues such as somebody as a champion of Public Private Partnership and another as a

champion of Corporate Governance. They used to meet CXOs of similar backgrounds who have

similar interests. They used to meet each other, may be five to six times a year, only on that common

interest and growing strong trust between them . We used to never talk about business with these

two companies. It was just about the trust between the individuals on some common global issues

they used to work on. That trust has helped the organisations benefit behind because they know that

we will never be let down. So building trust is a structured way of doing things. Building trust is

having that investment being made into it. Building trust is to have the person to person and

organisation to organisation. What all this does is very important. If you build trusted relationships

you create more pull; you don’t need to push your products anymore. Automatically every time

there is a demand. Automatically every time they look up to you and saying, I have this issue. Can

you please look into this? Can you come over and share what your thoughts are on this. By this you

are creating a pull for your product and not a push. Most of the times sales fail because we push.

Successful shift in attitude will transform the organisation’s approach and increase customer and

market confidence, creating stronger pull for your products and services.

How do you transform your engagement to the customer?

Having built a right attitude and a right approach to the customer, I was talking about how do you

transform and engage with the customer. Again I am taking the help of this cartoon which is very

familiar to you all. The gentleman therein is throwing a stone in the air hoping that he will get the

fruit to drop. Most of our sales efforts are like that, knocking at doors hoping that somebody would

come out who is willing to buy our product. It is aimless. They are constantly going without keeping

any aim. One of the concepts I talk about in this book is that every company can exist in this market


and create its own monopoly. You could have your own monopoly by the way you define your market,

your universe and your sweet spot. One of the questions you need to start reflecting is: How is my

lead to sale ratio? In many places I have seen this is very bad because you have not defined your

market; you have not defined who the right set of customers are for you. Your right set of customers

for your competitor within your own space need not be the right ones. Both of them can have unique

preferences. Is your customer a strategic fit to you? Is he looking for you that you add value and

you get the best benefits?

Let me give you an example. A large IT company would want a company which will at least give

them 50 million dollars run rate per annum whereas a medium size company would probably want

only about 5 to 10 million dollars as run rate per annum. If the medium size company chases

somebody who gives 50 billion dollars may win but it may not be in a position to service. It may not

be a strategic fit to them whereas a large company, a 10 million dollar account exists but they don’t

get the right attention.

So, how do you define your own sweet

spot? How do you define your universe?

The second part is, do you understand their

ability to buy? Ability to buy is just not

financials. Do they have the credit

worthiness, do they have the right financial

growth - all these will matter. It is also the

readiness to buy to put your product to

use. Many start-ups struggle here because

start-ups are coming with a product in

which they are ready, but the market is not educated about it. How do you get the customer ready

to buy? If you chase somebody who does not have the experience to put the product to use, how do

you sell? I think you need to understand the difference between ability to buy and readiness to buy.

But the most important thing is the propensity to buy. Is there an urgency? Is there a hunger? In

this story, I use a case in which I have actually worked for. It is a large product company who is

already an existing leader in the market, yet struggling on sales, we helped them to understand the

propensity to buy through financial numbers. We looked at some company which needed improved

governance; improved governance for this large IT product company could have been a value add.

Improved governance may be probably a case where a PE having invested in them or new Board

members coming in, whether they are growing, adding new products and so on. Only when we

targeted from 100 to 5, we actually helped them from 40 to 10.

That’s the kind of a sales ratio we changed because you are engaging with the market only when the

market is ready. This is also important that you don’t sell a product to a customer when he does not

use your product. How do you understand the propensity to buy? This particular chapter gives you

an approach towards this aspect. But each of your decision has to be fine-tuned and customised. It

is an on-going learning. But only when you start defining your market, understanding their ability to

buy and understanding their propensity to buy, will you not have the problem of knocking many

doors and not finding one of them to open. The first engagement is to have your sweet spot, define

your market and understand the propensity to buy.

I had three to four calls when I was waiting for this session this afternoon. I had a call on credit card,

I had a call whether I needed a personal loan and so on. When we get such calls, we slam the phone


down. Yet as companies, we are still doing the same thing. We still keep making calls. We still have

direct marketing hoping that somebody will pick up the phone. The next thing is that we start making

colourful brochures. How many times you get these brochures, you don’t even read them, you just

dump them. Yet, the inside sales team talks of how to do more. By doing more of the same, is it

going to be successful? If we constantly do the same thing, increase the number of calls, increase

the number of brochures, make them more colourful, send direct mails (most of my time is spent on

deleting such marketing mailers!) and so on. This does not work, but people spend a lot of money

on this.

It is true for B2B and may be in some B2C, there are examples of companies who have succeeded.

But I think the ratios are getting worse. The questions I want to ask you are: Are you leveraging

your networks? In times of such a strong social media networks, how are you not leveraging? When

I was finding a publisher for this book, the best way was to use my social media network and that

way I could easily reach out to the publisher than try and do a cold call to all publishers. Leveraging

networks gives you credible access to the right customers. The most important thing is that does the

network trust you? You have to go back to the first principle that we have talked about which is: Do

you have the right attitude to the customers? If you have the right attitude towards the customers

to whom you always want to give some value, then and then only the network will trust you. For

example, when Microsoft invested into LinkedIn, some of the large organisations, the way they use

it, it is very sophisticated. My calendar is now exposed to LinkedIn. In your organisation, there are

10 more people whom you are meeting with have connects with. Do you want them to have a word

with these people? So, it makes a big difference when you leverage networks. In the B2B word, it

does not make any sense at all. All of you have connects, from your past companies, from your

current companies and other networks. Just getting access to them is not a biggest thing. But it only

works when the trust works.

The other thing that people fail to understand in the story I talk about is: how do you position your

product to something which is strategic to that customer? Do you understand what is important and

what are his priorities? I was just helping a small software company that makes products in the space

of engineering design. Their buyers are somebody who simulate design requirements of their

components before they make them. I realised that in one of the sales reviews, I found that there

was a very good prospect whom they were going after. They had done demos after demos,

benchmarks after benchmarks hoping that the particular customer is willing to buy their products.

But what we realised in their case was the company whom they were pitching, the R&D and the IT

people were very happy with the product but the strategic objective of that company was to reduce

the level of components. Nobody had gone there to identify what the strategic objective of the

company was. They were actually pitching a wrong story. Months together they were wasting. So,

we have to understand whether it was strategic to that company, who will champion that issue and

then work with them so that you can leverage the network also aligning to the strategic needs of the

company. These are two critical aspects in enhancing your engagement.

The third thing is: Are you throwing communication darts at customer hoping that something will

address their needs? This whole chapter is to understand what the customer is looking for. You should

engage with all stakeholders and calibrate communication. What are the different stakeholders that

customer has to go back and communicate? Any buying is not a straight forward process. It is a very

complex process. Even if you are buying your own house, someone in your house might ask, “Has it


got a good resale value?” “Is it easy to maintain?” “Is it close to all my facilities?” “Are the papers

good?” So many different questions that need to be answered. People may be wearing different hats.

If you don’t recognise the different stakeholders’ needs, you will not be able to sell effectively. Half

the time your engagement fails, because you are not understanding the stakeholder. Unless you

understand them and calibrate your communication, it does not work. You need to reflect on those

questions that are associated with the stakeholders. Actually there are tools available in the market.

But the most important part is, are you having this as a practice? Without that practice, your

engagement purpose is defeated. Successful transformation of engagement will build lasting B2B

relationship and will result in enhanced sales effectiveness.

How do you transform sales management?

Let me shift to the last theme of the book. I am again using a cartoon to highlight on this theme.

What you see here are three different interviews with three different people. The first candidate says,

he has the product but the market is not ready. The second case talks that the market is ready but

his product features are not ready. Third scenario says that the product features are ready, market

is ready but he is selling in a market when the product and market demands are meeting. These are

three different scenarios. But sales management, I see in many organisations, tend to be the same

no matter what the market or product situation is. Sales management cannot be same for different

situations in the market. Many times, organisations and senior managements don’t provide that kind

of a support or they fail to provide that support. Generally sales reviews are fault finding. There is

no constructive organisational support happening there. For example, if your product is not ready

and the market has good demand for your product, the institutional support required for that is

completely different. You probably have to put the right team to ensure that your product catches

up with your market needs. If you product is ready but the market is not ready, may be, you have

to do lot more marketing. It is not the salesman’s job anymore. The organisation has to take over

and handle the issue. The salesman cannot sell a product when market is not ready. If both are

ready, you have to go back to previous chapter where we talked about the calibrating communication

and how effectively you are helping them to engage with the different stakeholders. As a senior

management, you have to start understanding what kind of support you can give to salesman. The

kind of senior management intervention has to be dramatically different depending on the situation.

So putting effort at the wrong end is not going to increase the sales. Increasingly sales management

is all about pushing more things from top, not helping things move from one stage to another stage.

I was actually sitting with a CEO of a medium size company who was only adding about two new

sales for every quarter. They are having, of course, mining of the existing customers. His entire

concern was that sales is not putting efforts. But if I looked at their pipeline, I saw things in different

stages; there were over 100 proposals. Management could have helped in negotiations. But the focus

of the review was all about “How much is not added to the pipe line?” “You are not meeting enough

people”. So more and more pressure is always put from top without moving them from stage to

stage. . In your own organisations, you should start looking at where the pursuits are. The

institutional support required is significant. It is just not a review for the sake of focusing on outcome

and saying that the salesperson is not doing enough work. What kind of institutional support you are

providing is very critical for outcomes.


An Overview - Politics of Economics

Dr T V Somanathan, IAS

Additional Chief Secretary to Government, Planning, Development and Special Initiatives

Department, Government of Tamil Nadu

A Summary of the Address by Dr T V Somanathan, IAS during the National Conclave on ‘Functional

Governance for a New India: Politics of Economics’ held on 12th November 2018 at Chennai

It is a great pleasure for me to be here today to

discuss a topic which is somewhat unusual and

a bit intriguing, and which is extremely relevant

to the present times, namely the “Politics of

Economics”. Before I go on, I should make it

clear that the views expressed by me here are

my personal views and not necessarily the views

of the government.

Economists, I am also one, would like to believe

that they are followers of a scientific method and

hence Economics considers itself a social

science. Matters of pure science do not attract much political disputation. For many years, for

instance, students were taught that Pluto was a planet. But in 2006, it was suddenly demonetised

and scientists declared that it was no more a planet. There was no political controversy in this regard.

However, economic issues on the other hand very frequently become the subject of politics; some

of you may be aware that till the late 19th century the subject we call Economics today was known

as Political Economy. Let me try to identify why economics is so political and let us see whether some

improvements can be made.

Positive vs. Normative Statements

Often people in India make comparisons with China, which is a national pastime of late. One of the

statements which is often made in that context, is that “Democracy reduces the rate of growth” and

another statement that is often made in the same context is that “Even if income is lower, we should

prefer democracy because freedom is intangible but invaluable”. The first statement can be called,

in the jargon of Economics, a “positive statement”. Positive statements are assertions; they may be

true or untrue, but they can at least in theory be tested or checked against evidence. The second

statement is a “normative statement” which is a value judgement. It cannot be tested against

evidence. It is based on individual value system and belief. There may be some who feel strongly

that regardless of income, the freedom that we enjoy in a democracy is most important and therefore

we should not worry if the prevalence of democracy impedes slightly the rate of growth in the

country. But there may be some who might say, “I am so poor and frankly it does not matter;

freedom is intangible; I would like to actually have a higher income”. Both points of view are personal

points of view. Ideally economists should carefully distinguish between the two and be clear as to

which part of the advice that they give is based on positive economics and which part is based on

their normative preferences. But often they do not. In fact, economists quite often tend to mix

positive statements based on theory, evidence etc., with normative statements based on what they

believe is the way the country should behave. This is the first reason that economics is so political--

because there is often a mixture of the positive and the normative, and norms of different people

are different; and therefore there can definitely be different political views on economic statements.


Gaps in empirical and theoretical knowledge

I said earlier that positive economics normally consists of potentially verifiable statements; the

emphasis is on the word ‘potentially’. Even positive economic assertions often cannot actually be

tested against evidence because unlike the physical sciences, we cannot conduct any laboratory

experiments. So if you are thinking of devaluing the currency, you cannot first do it in a test-tube,

check and then actually implement it. If you do it now, it may be different from what happened in

1966 because the circumstances are different between now and then. So, in the absence of laboratory

experiments, the ability to prove or disprove even positive statements is limited. Economists usually

have to rely on available data and the data available may not be sufficient for them to prove or

disprove the positive assertions that they make. And yet they are often under a compulsion to give

a conclusion. They have no option but to give some advice.

Also in many fields, and Economics is definitely one of them, big gaps exist in theoretical knowledge.

There are big gaps in the knowledge that economists possess even on issues of positive economics,

and analysis; recommendations may be made even in the absence of adequate evidence or the

presence of a gap in the theoretical framework. They may be based on normative values and figures.

A related point is that, many economists, tend not to disclose or reveal the gaps in their analysis

when they make their recommendations. They make strong assertions on weak foundations.

Distributive Effects in Economics

The third and most crucial issue, which is why economics and politics are closely connected, is the

distributive effects of economic policies. Economists typically make recommendations, or most often

make recommendations, based on aggregate costs and benefits. They look at whether a policy will

increase or decrease overall income, national income, wealth etc. A good example is International

Trade. As a matter of positive economics it is fairly established now (and incidentally today we saw

the obituary of Professor T N Srinivasan one of the votaries of free international trade who is from

Chennai) that in most situations free trade without import or export restrictions increases global

GDP. This is a proposition on which most economists would agree as a positive statement. If there

were free trade with no quotas, no tariffs, no exchange control, no import or export restrictions,

then, in such a scenario, the resulting GDP would be higher than in the presence of trade restrictions.

This is the basic foundation on which many economists argue for free trade. But this does not consider

the distribution of gains and losses. Suppose a country enters into a free trade agreement; it may

benefit some groups, say by 50 billion dollars and it may harm certain others by, say 30 billion

dollars; so there is a net gain of 20 billion dollars by entering into the free trade agreement. This is

the kind of analysis that is typically used in economic discussions on trade. But even in this example,

where the gains are positive, some countries, some industries, some workers and some consumers

are losers. In most trade deals, there are some losers. There is almost no free trade agreement

where there are no losers. The logic that says, “Look, we Economists look at the greatest good of

the greatest numbers; it is a great pity that you are one of the losers; perhaps you suffer but there

are number of people who have benefited; so you have to put up with your suffering” is not a good

enough answer to a person who actually has suffered losses. And this makes the policy inherently

political.

The problem is that, economists, because of their focus on aggregate costs and benefits (it is not a

failing with the discipline, but it is more of a failing with the way the practitioners use it), don’t pay

enough attention to compensating the losers from a policy which is overall good but has some. Brexit

is a very clear case; probably 95% of British economists, if they had been polled, would have voted

against Brexit but a majority of the population voted for. Again this is because, though there were

aggregate benefits, there were significant losers in the United Kingdom. The North American Free


Trade Agreement (NAFTA) which involved Mexico, United States and Canada is another example

where most economists to this day believe it to be one of the most positive movements in the global

trading system but a significant number of the people in the United States were losers; there were

significant sections of the country, certain types of industry, certain type of workers who were

affected negatively and that helped produce a popular backlash and you have seen the protectionist

trend in the United States.

The basic point is: Economists often do not explicitly identify the distributive consequences of the

policies and programmes that they espouse in terms of who gains and by how much, and who loses

and by how much. Sometimes, this is because they have not been diligent or because there is lack

of evidence and hence they are ignorant of the plight of those who will be adversely affected. But

sometimes, they are aware, but they keep quiet because they feel that it is still the right policy and

they want it approved and it is better to get it approved by stealth (because if you reveal all the

complications, the political executive may not agree to the policy). There is a Tamil proverb that

says, “Tell 1000 lies and conduct a marriage”, in

the same spirit they say, “Look! It is a good

policy and let us tell a few lies or not tell the

whole truth, and let us get it approved.”

Interest rates as an example

Let me take interest rate policy as a specific

example to illustrate each of the three problems

that I referred to, namely, positive vs.

normative statements, absence of empirical or

theoretical data and the distributive issues. Let

me start with the statement that “An increase in the interest rate will reduce the level of economic

activity”. This is a positive statement that can be positively checked. There is a lot of theoretical and

empirical evidence that it is true and I am sure many people here in this room will not dispute that

an increase in interest rate will bring down the level of economic activity. Let me make a second

statement: “A reduced level of economic activity will reduce the rate of inflation”. This is also a

positive statement. Here, the economic evidence is mixed. Sometimes, if you have a cost-push

inflation, let’s say, due to import prices going up, of oil or steel, a reduced level of economic activity

does not by itself cure inflation because inflation actually has cost-push cause. Yet Central Banks

globally tend implicitly to assume that every reduction in economic activity will help in reducing

inflation. For argument’s sake, let us accept the second statement that “reduction in economic

activity will reduce inflation”. If both statements are true, then, raising interest rates will lead, firstly,

to lower inflation which is a good thing, but will also lead to lower growth, which is not a good thing.

Partly this becomes a normative question. Do you prefer low inflation with low growth or do you

prefer high inflation with high growth?

More importantly it has a distributive impact. The first distributive question is: who gains from higher

interest rates and who loses from higher interest rates? Very simply, depositors gain from higher

interest rates; depositors include senior citizens, people who depend on small savings and so on–

they benefit. Who loses? Borrowers lose in general; borrowers include those who take home loans,

consumer loans and of course businesses taking working capital loans. The losers are businesses as


well as some groups of consumers. The second distributive question is: who gains from lower inflation

and who loses from lower growth? As an over-simplification, those who with fixed incomes are

benefited by low inflation and also don’t gain much from growth. On the other hand, those with

flexible incomes gain from growth more than they lose from inflation. Suppose we want to assess

the impact of interest rates from the poor, whether high interest rates hurt the poor or benefit the

poor will depend on which category they fall in. Are they predominantly savers or borrowers? Are

they predominantly on fixed incomes or variable incomes? The point of what I am saying on this

simple economic question on the effects of a change in interest rates, is that any economic policy

change can affect different groups very differently.

Secondly, we cannot always be sure which group will be affected in which way because we don’t

have perfect data on what the poor do or what the rich do or how many people are rich consumers

and how many are poor consumers or rich savers or poor savers and so on. We often have to make

decisions in the absence of precise data.

Towards better policies even when economics is political

This brings me to my main point which is: When an economic policy benefits some and harms others,

there are obvious and inherent political implications. I would submit that such decisions cannot and

should not be made by experts alone. These decisions, when you are choosing between one group

of people over another group of people, which you are often doing either consciously or

unconsciously, need democratic legitimacy. Hence, politics, especially democratic politics is an

essential part of economic policy-making however much the middle classes may prefer it to be the

other way. It cannot be any other way and it has to be political and it will always be political.

Then what is the role of the economists if these are political decisions? The role of the economists, I

would submit, is to help a democratically-elected executive make better choices or make the best

possible choices with the available information and available situations. To do this, I would submit,

and I say this as an economist myself, is that economists need these three things:

• they need more clarity;

• they need more modesty;

• and they need more honesty.

They need more clarity in distinguishing between the positive and normative aspects of what they

say. They need more modesty in admitting gaps in their knowledge; and they need more honesty in

identifying who will lose from a policy that they are espousing and finding ways to compensate them.

The other half of the equation is of course our politicians and policy-makers who also, I would submit,

need to become better at interpreting the advice of economic experts. They should have a healthy

scepticism of any blanket or simplistic pronouncement from a so-called “expert”. Second, they should

insist on being informed of both advantages and disadvantages of any policy recommendation which

they are presented with by civil servants or by economists.

In conclusion, politics can never be removed from Economics, but the country can benefit from better

policies and greater democratic accountability. For this economists giving advice need to be more

diligent, while politicians interpreting that advice need to be more vigilant.


Emerging Management Challenges

Prof G Raghuram

Director, Indian Institute of Management Bangalore

A Summary of the Keynote Address delivered by Prof G Raghuram during the 17th MMA All India

Management Students Convention 2018 on 25 September 2018 at Chennai

At the outset it is an honour for me to address the

Students Convention.

Before coming here, I thought I should

understand about MMA and so I gathered

information about MMA. MMA was founded as

Madras Institute of Management in August 1956

by Dr. Lakshmana Swami Mudaliyar, the then

Vice Chancellor of Madras University along with

20 institutional members and it was inaugurated

on September 19, 1956. Then they became a part

of the All India Management Association in 1957

when the name was changed to Madras Management Association. It is a humble vision of

Academicians to reach the pinnacle of excellence. They have a long way, 62 years! MMA actually sets

the standards. This event is amazing to see with 1000+ students from large number of institutions

from Tamil Nadu and may be other parts of the country. The All India Management Association has

awards for the local Management Associations and MMA has been winning the best local management

awards continuously now. So you must all be proud in participating in an event of the MMA. I must

say that I was also associated with Ahmedabad Management Association which also is like a role

model amongst the local management associations and before MMA took over Ahmedabad

Management Association has been winning the awards. I am on the Board of All India Management

Association.

I am going to give some counter points. Today in many such Forums I find people saying that the

environment is changing fast and often they use the term “VUCA”. By VUCA, they mean, the world

is volatile, uncertain, complex and ambiguous. Of course I am worried when we paint it that way

because things are always changing. In fact change is the constant as is often said. VUCA existed

200 years ago, it existed 50 years ago. If you go into recent history, let’s take the years between

the First World War and the Second World War, you would not know to which country you belong to.

You could have had a more VUCA world then. To me what is important is the environment and that’s

how the environment will always be. Therefore I don’t want to get perturbed about it. I would like to

focus on myself to see how I can read the environment and see how best I can contribute based on

whatever I think I can do. That to me is important.

Same way, in a context, in somewhat critical note when I just picked up a sentence from the

Challenge of Talent where we have said that the “human capital has virtually become last unexploited

source of competitive advantage”. I would again worry about it. I have always heard that if you want

to run a good organisation, if you want to do something meaningful building across people, whether

you went to a war or anywhere, it is always how you work with the people around you. As a

fundamental principle, these have always existed. But, yes, dimensions changed and what we need

to be able to understand is what those are.


Today’s employees are distinctly different from their predecessors partly due to change in value

systems (of course, I would worry what kind of value systems) and partly due to rising educational

levels. I look at myself in 1976 when Ram and I were batch mates in IIM Ahmedabad, I somehow

could make it there. But today when I see our students, they are amazingly aware of things. So there

is very high educational and awareness levels. It further says that the new generation employees

resist command and control leadership styles, may be to some extent, have less reverence of

authority (I hope not!), possess greater ambitions, more questioning of conventions and rules (that

should be a continuous process) and stay focused on work-life balance (Very often it is interpreted

as work and life as two different constituents and you have to fight time for both. To me work and

life have to merge into one another and bring a little bit of life into work and vice versa. I have no

grievances of work-life balance). Of course while posing a problem to their managers, they can also

be a source of creativity and innovation, (Yes, just because awareness levels are more, this is

important), risk-taking behaviour and achievement orientation. I believe that many of these traits

always exist in us and the important question today is “How do I unlock those traits?” How do

successful organisations of today overcome the challenge of engaging the new generation of

employees and produce superior results?

Recently I was in a small and medium enterprise (SME). There was an event in Belagavi, in Northern

Karnataka and in one of the enterprises, I found an interesting “Factory vs. Work Temple”. Basically

the philosophy with which that gentleman was running his enterprise had it is a work temple. They

were making some valves and high-precision manufacturing. I will highlight some of the principles.

Of course, these are in some sense exaggerated concepts and I am sure, many organisations are

somewhere in the middle but it is useful to think of some of these attributes. One side you think of

the self and the other side we all think of “we” and more inclusive, all the stakeholders are important.

May be in time sense, relatively shorter term, in longer term, you discipline people with somewhat

of a threat or force but discipline is by understanding. Some of you may have heard of Theory X and

Theory Y. In some way you can say that a lot more of theory Y exists in the work temples and theory

X in the factory concept. People work under pleasure in Work Temple and people work with pressure

at factory. Human resource is a need in factory while human resource is an asset in work temples.

That is very important. So, invest in human resource. Less freedom and authority in factory whereas

resources are more empowered in work temple. Output delivered due to pressure in factory and

output delivered happily in work temple. Output may be a product but output is actually more than

a product, high quality or pride in quality or may be, to view it as a solution to your customer.

There are four environmental aspects and how well you integrate them when you take an

organisational perspective. People’s challenges are customer and talent and competition and

technology which play a critical role today. Within technology, digital; of course our PM has been

reiterating that somehow in India technology has synonymised with digital. We need to look more

than that, any new way that allows you to have a quantum jump in terms of your output or ability

to do something different, I think is a form of technology. Of course, yes, digital is making a big

impact.

We are looking at these dimensions. Having said that, what I want us to understand is that we are

in India and therefore what this India we are talking about is, I am sure, many of us may be coming

from smaller towns or tier-2 towns. You all must have heard about Bottom of the Pyramid. India is

highly skewed in the wealth distribution. There are very few people at the top who control and own

huge amounts of wealth and the large group down there which barely is able to manage its survival.


I don’t want to get into the details of the numbers. There is an interesting comparison with China

and you will find China for whatever it has gone through, today the income distribution is relatively

better than India. In India, if we really want the country to grow well, for which we have enormous

potential, double-digit economic growth is possible. It is not 6% or 7%. At one time we thought some

Hindu rate of growth at 3 to 4%. We broke that and there is no reason why cannot get into two-

digit growth. In fact, our greatest resource are the people. So, skilling today in my view is a very

important aspect and that’s where all of us need to understand the potential of this. Here I am

saying, most of us are already in the skilled category. The fact that we are doing an MBA means that

we have come a long way compared to the large number of India’s population. But yet we need to

see how that resource can be used in a better way to not only achieve double-digit growth but to

give them meaning, to give them good earning potential. It is assessed that in the next five to ten

years, every year we need to up-skill 2.5 crores of people per annum. This is a huge opportunity for

all of us.

There are lot of data the Skill Ministry has put out as to where are these people likely to be employed.

For example, out of 2.5 crores, number one is actually the domain of infrastructure. Construction,

road making and housing - all these sectors need people. We need to improve the quality of houses.

We need lot more roads, quality roads have to come in such variety of activities in infrastructure.

Some 0.8 crores out of the 2.5 crores can be employed in infrastructure. Following that there is

already a mention of services and logistics as a service. Just being able to get goods across in a less

damaging manner is very important and a lot needs to happen in that. Health, wellness and beauty

– people even in tier-3 or tier-4 towns want to be well groomed and hence there is a huge service

activity.

In fact, underlying would be in many ways using digital or data analytics and lot of these applications

actually will emerge, may be not naturally but with the right nudge in the tier-2,3 and 4 cities and

may be in rural areas. Though I think between rural and tier-2,3 and 4 cities, it is a bit granular

because you will find tier-4 or tier-3 town almost within 20 to 25 kilometres of the remotest part of

the country. Today, with the roads under Pradhan Mantri Gram Sadak Yojanas, motor cycle

ownership is increasing and availability of bandwidth and mobile and smart phones, I think that 20

kms is not such a big issue and so even if we focus on employment generation in these areas, that

2.5 crores will get something meaningful to contribute to the economy. Here I am trying to analyse

to get a broad sense and to see how there will be an equilibrium that where are the 2.5 crores of

people from? Where will they come from? 0.4 crores per annum is expected to be a shift from

agriculture. Today we have about 60% of India’s population dependent on agriculture which produces

16% to17% of the country’s GDP. It cannot sustain. You cannot have 60% of the people earning

16% of the country’s total revenue generation. That itself is a cause of what is often said as

“Agricultural distress”. While we can improve agricultural productivity, remember, India is self-

sufficient in food. We can improve value addition, maybe, we can export, but to me, the head room

is not too much. In fact, the way people earn more in agriculture is when more people move out of

agriculture and there is a huge aspiration to do that. That’s where the 0.4 crore will come from which

is all from rural areas. Then comes the demographic dividend. About 1.2 crores who are in the next

five to seven years, given our population profile change, will be moving into the 18 to 60 bracket.

This means that 1.2 crore people over and above who will move out. They have to be provided for.

Then another 0.9 crores are under skill-up gradation. They are people today who are completely

unskilled but do some daily wages. That’s how the 2.5 crores comes in. If I split this between urban

and rural, 0.4 crores from agricultural which is anyway from rural and I am splitting the remaining


in the population profile as it is today. The total out of 2.5 crores will be 0.7 crores will be in urban

areas, 1.8 crores in rural areas. Now see the equilibrium. The primary source of this human resource

is in rural areas; the need for development such as roads, housing, electricity, toilets are all in rural

areas. That’s the opportunity in the country and that’s what all of us who are better off, as we move

out of our management education, need to think of, especially in entrepreneurial way, as to what I

can do to marry these two together. Of course, we must recognise that India is culturally, socially,

geographically, environmentally and economically diverse. When we are worrying about what kind

of organisations, I think, this is the reality. The most important expertise a manager must have is

understanding of the reality of grass-root level population. Today, if I go out from my MBA without

an understanding of the true India, I am not sure I have really got, what I think, is any education.

Accountability and responsibility is not limited to customers, shareholders and employees alone who

are the traditional stakeholders, but also to society and the environment and in a sense to

Government too. In India, Government plays a very important role and many times, many of us do

our businesses viewing government more as meddlesome. Of course it may be, because

unfortunately government itself needs capacity building. But we must understand how Government

policies, systems and regulations work so that instead of being a “We vs. They” we need to

understand what are those limitations, partly to influence and get those limitations out of the way

and partly, to work with government and create these new economic enterprises.

Let me now list out the expertise that are “Must have for Managers”. I want to highlight that the

entrepreneurial mind-set is important and may be, the data analytics as some new ideas. Otherwise,

of course, customer orientation, accountability, adaptability, conceptualisation and so on. The World

Economic Forum came up with an analysis in 2015 an assessment of 2020 as to what would be the

top 10 skills required.

What is interesting is that while complex problems-solving skill has been number one, and India is a

classic example of that. Anything you do, there is a complexity, the web of challenges. But that is

our responsibility to work within that web. Critical thinking was number 4 that has come to 2.

Creativity which was much lower down at number 10 is moving up to number 3. So the ability to

think out of the box is very critical because I need to marry all those human resources in rural area

with the kind of opportunities in small towns, and for this I need to think out-of-the box. Interestingly

emotional intelligence has made an entry into the top 10. For Understanding human behaviour and

building relationships, emotional intelligence is very important. What is moved out? I think on a

global scale, it is quality control. I would be, of course be, worried for India because I think in India,

quality is still a much needed attribute. Anyway in the top 10, globally these are some of the

differences from 2015 to 2020. But I have to leave with the thought that creativity is important;

emotional intelligence is important apart from complex problem-solving. At this stage, I want to give

an example of an organisation in which very beautifully combined Indian reality and yet makes a

strong global presence and that is the Gujarat Co-operative Milk Marketing Federation. I am sure all

of us have heard of Amul as a brand which simply comes from Anand Milk Union Limited. Amul

started out around a time of independence and it married the Indian reality, in the sense, the dairy

farmer is still from a self-respecting family, wants to be his own boss. They own few cattle. How can

Amul aggregate across the large number of farmers and collect that milk and then move it into the

organised sector? Amul gives guarantee to the farmer that whatever milk he brings, Amul will take

it. Amul will focus on marketing, quality control, high-end processing, and the milk supply started

increasing year after year. New products started coming in. In fact Amul has so many products that

today they have retail outlets that handle only Amul products, with this interesting marriage of what


we call the semi-organised sector. In fact the success of GCMMF created a parent organisation called

National Dairy Development Board which carried this model to all the states and even in Tamil Nadu,

the way the milk system is handled is based on the same model. In 2010, India crossed the United

States to be the world’s number one milk producer. Today we are almost 80% more than the number

two in terms of total milk production in the country. We have come a long way in that and the kind

of employment it has provided to small, medium and large enterprises is something noteworthy.

Let me just end now. I said, it is better for us to take hold and not get affected by the VUCA world

but be good observers. Therefore we need to get to fundamentals. Management education must

challenge and create a thinking and learning human being. I can do any kind of course say supply

chain or branding. But the ability to think through and to be willing to learn new things is important.

It is not to be pushed against the wall but as one of my favourite teachers in IIM Ahmedabad says,

it is to push through the wall. They are the barriers and I must be able to break into barriers. The

“what” is not important as the “why” and “how”. Attitude and aspirations are more important than

(again if you don’t mind), talent and terminology. Today if I go for any recruitment, what I look for

is the positive attitude of a person along with the ‘fire’ to do something. This is more important. The

rest of it you can build into a person. Culture is reinforcement. By reinforcement I mean you need to

get into the fundamentals and repeat them and that is how culture is built. Then of course, the

multiplier effect being a faculty must go all out to invest in faculty development.


Emerging Management Challenges Raju Venkatraman

Founder Chairman & CEO, Medall Healthcare Pvt Ltd

A Summary of the Valedictory Address delivered by Mr Raju Venkatraman during the 17th MMA All

India Management Students Convention 2018 on 26 September 2018 at Chennai

It is always a pleasure to come to MMA and

particularly to the Students Convention. I

want to thank Ramesh who does this with

lots of passion and also Gp. Captain

Vijayakumar. I know that lots of speakers

have spoken on the theme of “Emerging

Management Challenges”. I really think

that it is an exciting world that we are

living in. My conversation with you is going

to be very focused on the word

“emerging”. What does ‘emerging’ mean?

In Tamil, it means one that is ‘growing’. It has lot of potential in it. If you look at India why people

like us are excited to live here and continue to work hard is because we really believe that we are

going to be a super power. We really believe that people like you in the audience have a very big

role.

I want to just put some numbers and perspective to you. Let us assume that you have 100 items on

your hand. Here 100 is the starting point and you grow it at 2% per year, and with the hope that

most of you will work for at least for another 30 years, that 100 will become in your life time 178. I

just want you to spend just two minutes to understand this because there is an important message

here. So 100 becomes 178 in the 30th year if it is growing at 2% per annum. What if it is 5%? At

5%, it becomes 412. This is the opportunity in front of us. Now we are talking of GDP growth of 8%

and I don’t want to worry too much about trillion dollars. But let’s take 100 as the base and see what

is 8%, 30 years compounded growth. It is 931. Before I go further, can anyone guess what that

number would be if it is 10%? It will be 1586. And if it is 15% per annum over 30 years, 100 becomes

5757. I know you all know math and you can work on excel. There is growth opportunity to each and

every one of us. Now if you take 100 and convert that to one lakh, and say you are going to grow

personally at 1% per annum, 30th year what is your salary per month? It is 57 lakhs per month.

Humongous Opportunities are there but there are challenges too.

“Emerging” really means “there is an opportunity to grow”. I think the Convention is clearly focusing

on what the management challenges are around the world, particularly in India, and I am sure you

guys will know most of it and I want you to take home that there is a huge opportunity ahead of us.

I can tell you from my personal story that I have seen this kind of growth in my life in the last 30

years. It is actually 37 years since I started working. You don’t have to be an entrepreneur to make

it. There are several success stories today where young management talents helped other

entrepreneurs and they have also gained their own share. It’s not about the money. It’s about the

skills you need, the talent that you need to acquire and how do you go about it at this point in your


time. Life is very important. I will tell you couple of other things. We talked about “emerging”. Now

let us focus on “Management”. If I were to define “management” in three words that I use personally,

“plan, plan and plan”, “execute, execute and execute” and have “controls, controls and control”.

There are enough CAs and accountants in the world to help to ensure good controls. But planning is

not easy. For growth, you need people, you need ideas.

Let’s talk a little bit more on what is it that is required and what are companies like ours who are

growing fast and what are other companies that are struggling with? The real challenge is not lack

of opportunity but how do we convert the opportunity to actually cash. Whether it is for a company

on which you get a part of it or yourself if you are the entrepreneur. If you are the entrepreneur, it

is not you alone. It is your entire 10000 people who work will also benefit from whatever number

that works with you. So, today when we look at the eco-system, I don’t know how many of you have

been to IIT Madras Research Park, it a green facility. Green facilities are there today. If you look at

the IT companies and the buildings in OMR that are there when we were growing up, you will find

them green. This is a dream in front of you. We have world-class infrastructure here today as against

the times when we did business. When I went to the US, believe it or not, we lived on Faxes! Every

night we would write proposals and we would send them by Fax. Then came Fedex. Today, with the

digital technology, you can do business at any part of the world and you don’t physically have to be

there. But still there are significant challenges for people, for organisations and for the country and

even the government to grab the growth potential. Realistically an 8% growth of Indian GDP is

possible for a sustained period of time. But we are struggling. There are lots of internal issues; lots

of challenges. So these are things I would like you all to think about. We may not be able to do many

things, but if we can create a few ripples, that is good enough. So please understand your

responsibility.

When I left India and went to the US, and I am not here to say, “Don’t leave India”. If it works for

you, go out but the real growth that is there is in India. We may have challenges, we will overcome

them. The rest of the world, Europe and America today are not even growing at even 2 to 3%. When

we look at the 1.2 billion plus people who will soon be 1.5 billion people, everywhere there is

opportunity. There is opportunity to build homes, there is opportunity to build roads, to bring power,

there is education, health care, and then there are consumer goods. Everywhere there is opportunity.

But India is not an easy country. I have now lived for 18 years and all that I would say is”Indian

consumers understand value”. You have to price your product according to Ravi Venkatesan (Author

of “Conquering Chaos”) with 30% price and 70% value. Indian consumers are extraordinarily smart.

30% price and 70% value is the mantra. But then how do you make money? That’s what we need

to figure out right everywhere wherever we go. The products that are priced at 30% of the perceived

market value, and the value is not 100. Value is only 70%. People buy it.

Let me go to one more thought: what is the emerging management challenge? In my mind, it is

skills. We don’t have enough skills. Skills can be acquired. The real challenge is talent. Now, what is

the difference between skills and talent? You people can Google it, it’s all there! Can anybody sing?

Can anybody dance? Can any individual in the world become an entrepreneur? The answer to all of

these is “Yes”. The guys who are talented have certain natural inborn skills but that does not make

them great. You take Tennis super stars, they work from the age of 5. You take Bharatanatyam


dancers, they put 70000 hours of practice before their first stage performance. You take cricketers

today, the skill is acquired. Talent is there but if there is no hard work behind it and there is no

mentoring to help, we are not seeing them blossom to lead the field that they are in.

What about organisations? Now I can talk of top 50 guys whom we meet in Chennai and constantly

they are saying, they are short of talents. Let me give you a very simple example. I did not know

the difference between talent and skills some 20 years ago till I hired a consultant. He said, “I did a

study for Ritz Carlton, a big hotel chain. They were going down; their house-keeping staff recruiting

was a problem. Everywhere else, there were problems. They said, they give a job description of what

a house-keeping person should do. The JD contains the following tasks. “Remove the bed-sheet; put

it upside down; dust the window; clean the lampshade; flush the toilet” and so on. All these are

acquired skills. But when we went in we threw the JD out and we said, “We want you to have the

talent to find the dirt in the room”. It is an inborn skill; people who enjoy doing something like this,

they go home and clean their house. Whereas the guys possessing the skills go home and say they

are tired and they have already done eight hours of house-keeping. They don’t have time to keep

their house clean! Just giving you a little bit of example. Therefore, please dwell on it and acquire

the talent. Organisations need talent. You can check with any manager or any leader; their biggest

challenge is to stay ahead of what is happening and continuously learn. If they stop learning they

are over.

What you are seeing here is the model which Nol Tichy who set up Crotonville for GE and I had the

privilege to take classes under him in the University of Michigan. He would summarise and say that

the talent that we need is people who have ideas not just hare-brained ideas, but ideas that can be

fitted into a business model, which can generate money for the organisation. Never forget the word

“Values”. We talked about ethical values. No compromises because organisations without values

generate lot of money but they don’t last forever. So, values are equally important. Then comes the

‘raw energy’, the energy to execute, energy to ideate, energy to grow and the energy to look for

opportunities. Those are the critical things. Last but not the least, the toughest talent is “edge”,

which means the ability to take a decision. You can analyse and paralyse yourself but if you don’t

have the skill to take the decision and make an impact in your organisation, you will not be very

successful. We talked a lot about edge and we talk about all this when we set up seminars like this.

What is it that MMA wants? What does Ramesh and Raju benefit after spending their time on these?

Everybody is doing pro bono. We just hope we inspired one person in the audience. We just hope

that one person gets the idea then it is all worth it and we can continue to keep on doing this. We

do this year after year. We bring great speakers from all over India to help people absorb these

things.

Having said this, I want to leave you with a thought, that our biggest challenge is not money today,

it is not the government laws, it is not the demand from the consumers, it is putting together things

with talent and talent that can continuously upgrade their skills and keep themselves ready for the

next opportunity.


AI: Reinventing Human Resources Artificial Intelligence (AI) is all set to take your HR experience to another level

Umasanker Kandaswamy

COO & Joint Director, Bruhat Insights Global

Scenario One: The Vanishing Act

Jacob, Hiring Manager at a leading pharmaceutical company,

was in full swing to fill the vacant sales positions in the newly

launched innovative medical branch of the company.

The week ahead was lined up with interviews and Jacob was

extremely thrilled and excited about meeting new candidates.

The interview day dawned. And what was supposed to be an

action-packed day, turned out to be a shock-giver when 30 out

of the 55 candidates that were lined up for interviews that day,

didn’t show up.

Having invested time, energy in screening, sourcing, resume

matching and more important lining up interviews, Jacob felt

annoyed and was frustrated to have a no-show on the D-Day!!!

The follow-ups with candidates by his team were in vain. Repeated attempts to establish

communication with those 30-odd candidates went futile. The baffled recruitment team had to start

screening and searching for suitable possible recruits all over again. Now, the company’s brand name,

a well-established one, was at stake. It was crucial and critical that Jacob traced his communication

footprints with candidates and figure out where he and his team went wrong. He was perplexed once

again.

Scenario Two: The AI eye view

A new play that was being screened across theatres was drawing in crowds. The protagonist of the

play was a candidate who invariably performed the disappearing act in most interviews leaving

behind a trail of frustrated hiring managers. Companies were tired of analysing candidate behaviour,

trying to find out on why candidates did not show up for interviews. An advertisement on the internet

caught their eye and they hired the services of an AI detective – yes, you read it right -- who solved

their problem in no time.

So, what was the AI detective’s magic wand?

Did the detective have any placeholders? If yes, what were they?

How did he manage to bring the elements of hiring into one single cognitive hiring?

How do we ensure greater conversion from interviews to acceptance of offers?

How do we recruit talent with a higher probability of staying?

How do we read more deeply into candidate mindsets to analyse their patterns?

How do we leverage technology for business success and continuity?

Getting the “Tech” Hand

These and to those other million dollar questions that most recruiting managers today are faced with

and are seeking answers -- AI promises to help HR automate their myriad of tasks such as candidate

screening, hiring, engaging, re-engaging, employee relations and on-boarding that involve never

ending man-hours. AI frees hiring managers of mundane functions and enabling the HR department


to be more efficient, and building compliant and regulatory policies. This means HR managers must

be able to hire bold!

BRUHAT Insights Global presents solutions to all those unanswered questions – one-stop solution for

predicting candidate offer acceptance ratio. Yes, We Can Help You Hire Bold!

AI: The Enabler

Artificial Intelligence (AI) is set to be a game changer in the HR function primarily in the field of

talent acquisition (TA).

Among the prominent areas within the HR function that AI permeates, talent acquisition is the most

prevalent and pervasive in corporates. The importance and the impact of AI that has been in

existence in the form of people management tools ever since the origin of HR was never undermined.

However, in today’s networked world, while talent shortage still remains a concern to most HR

managers, the other popular problem faced by recruiters today is candidates not turning up even

after accepting job offers. And reasons, are varied and absolutely bizarre in most cases.

A meaningful combination of Artificial Intelligence (AI) and Human Insights paves the path to

innovation in hiring. BRUHAT is an AIHR (Artificial Intelligence in HR) company that utilizes artificial

intelligence to make it easier for hiring corporates to not only effectively manage their people

requirements but also obtain actionable insights, to drive productivity and engagement.

Bruhat: Think Big

Bruhat devised a robust data capturing mechanism that helped the team leverage both structured

and unstructured data that emerged during candidate interactions. By employing data-driven

profiling methods, the team was able to ensure a very high candidate selection rate and high

interview-to-joining conversions. Today, this data analytics process has scaled up to use AI and

machine learning.

Artificial Intelligence is capable of detecting several layers of information that emerge from a single

conversation with a potential candidate. But such data is possible only when human insights also

combine with AI to build a valuable relationship. This service utilises not only the machine learning

that emerges from providing multiple cases to the tool – it also leverages the profiler’s innate skill in

having a thorough, data-rich conversation with the candidate.

It uses Bayesian inference to create prescriptive offer-acceptance scores of shortlisted candidates,

based on 166 unique touch points. Data mining is an opportunity to learn more about the candidate.

It uses of a transparent recruitment mechanism that includes a candidate’s competency scoring,

identity cloud capture, keyword cloud capture and prior offer- acceptance patterns, using AI

solutions. It is derived from profiling of 1.5 million resumes and seeks to close the gap between offer

and acceptance. Bruhat is a one–of-its-kind AI venture that eliminates human error in screening

processes especially in volume based hiring. With data scientists and behavioural scientists added to

the sourcing efforts, Bruhat kick-starts a new path in hiring process, one that is cost effective and

encourages productive interaction with candidates.

Human element is necessary to deal with humans. Whereas, intelligent and strategic approach is

necessary so that a person is not unpredictable. AI cannot replace the human element in hiring.

Making the best use of resources, we are here to empower recruiters with technology and enable

you to hire BOLD..!!!


Registering Memories

Senior Defecne Officers from the

College of Defence Management,

Secunderabad visited MMA on 13

December 2018 as part of HDMC

Management Education Tour

(L to R) Mr Palam Kalyanasundaram,

Mr Ratheesh Krishnan, Ms Aparna

Sharma, Mr Bagavan during the MMA

- KAS Panel Discussion on ‘Between U

& Me’

(L to R) Mr Raghavan Srinivasan, Mr A

Vellayan, Mr R Seshasayee, Mr Srivats

Ram and Mr Vinay Kamath during the

Panel Discussion on ‘Table Talk:

Conversation with Leaders’

Mr Peter Rimmele, Resident

Representative to India, Konrad-

Adenauer-Stiftung addressing the

delegates during the MMA–KAS

National Conclave on ‘Functional

Governance for a New India: Politics

of Economics’ held at Chennai



Mr Andrew Harding, Chief Executive -

Management Accounting-

CIMA/Association delivering the

Keynote Address during the Seminar

on ‘The Future of Finance’. Gp Capt R

Vijayakumar, (Retd) VSM, Mr L

Ramkumar, Mr Venkkat Ramanan and

Mr Bhaskar Ranjan Das were also seen

Mr Harry MacLure - Editor - ‘Anglos in

The Wind’, Film-maker & Designer

addressing the members during the

Event Series ‘The Uncommon Leader:

Empowering Entrepreneurship’.

Mr AVIS Viswanathan - the

happynesswala is chairing the session

(L to R) Mr P C Balasubramainan, Mr

Karthik Kumar and Ms Sangeeta

Shankaran Sumesh during the MMA–

KAS Panel discussion on “Don’t

Startup - What No One Tells You

about Starting Your Own Business”

Participants of Five-Day Certificate

Course on ‘Occupational Safety’

jointly organised with Regional

Labour Institute (RLI), Government

of India


17th MMA All India Management Students’ Convention 2018

Theme: Emerging Management Challenges

25 & 26 September 2018 - Kamarajar Arangam, Chennai

The Chief Guests Prof G Raghuram &

Mr T Krishnakumar (KK) releasing the

Students’ Convention Special Issue of

Business Mandate during the

Inaugural Session of 17th MMA All

India Management Students

Convention 2018

(L to R) Mr K Srinivasan, Mr Sriram

Narasimhan, Mr K S Ramesh & Mr

Kumar Kandaswami during the

Business Session on ‘Emerging

Business Challenges’

(L to R) Mr Balaji Prakash, Mr

Ranganath N K and Mr Krish Ganesan

during the Business Session on

‘Emerging People Challenges’

Finalists of Grand Finale, Chanakya

The Mastermind 2018 Competition

along with Panel of Jury and

dignitaries


17th MMA All India Management Students’ Convention 2018 (contd…)

The Quiz Master Mr Ajay Antony

conducting ‘Think Tank: The Master

Brain - Management Quiz

Competition’ during the 17th MMA All

India Management Students

Convention 2018

Dr Mr K M Padmanabhan addressing

the delegates during the Presentation

by Champion Team of Business Plan

& Paper Presentation Competitions at

17th MMA All India Management

Students Convention 2018

Mr Shiva Subramaniam addressing

the delegates during the special

session on ‘The Creativity Challenge’

at 17th MMA All India Management

Students Convention 20180000

M The Chief Guest Mr Raju

Venkatraman along with dignitaries

presenting Cash Award of Rs One

Lakh to Mr Sandeep Kumar Patra of

IIMB the Winner of ‘Chanakya – The

Mastermind’ for the Year 2018



Mr M Selvam, Chairman, MMA Attur

Chapter delivering the welcome

address during the talk on ‘Stress

Management - Key to Performance

and Productivity’ by the Speaker

Mr T K Vadivel Pillai, CEO & Founder,

IIMS Mind Academy (seen seated

third from right) at Attur

Prof Dr M Desingurajan, Member,

MMA Attur Chapter introducing the

speaker Mr G R Balaji, AVP, Wealth

Advisors India Pvt Ltd (seated second

from right) during the talk on ‘Keys to

Wealth: Wealth Management for

Businesses and Entrepreneurs’

Speaker Mr G R Balaji receiving

memento during the talk on ‘Keys to

Wealth: Wealth Management for

Businesses and Entrepreneurs’ at

Namakkal

Mr T Manoharan, Business Strategic

Consultant, delivering a talk on ‘Role

of Leader in Modern Organisation’ at

Salem



Mr C K Ranganathan, Chairman &

Managing Director, CavinKare Pvt Ltd

during the MMA-KAS Lecture on

‘Creating the Innovative Field - The

Navarasas of Innovation & Thinking

Tools and How to use them’ by Dr

Rekha Shetty, Managing Director, Farstar Distribution Network Ltd

Mr Prinjal Sinha, Ms Pushya

Sitaraman and Mr T N Manoharan

during the MMA-KAS-FCDR ‘Business

- Mediation Summit’

CA Umesh Gulecha, Partner, Prakash

Kochar & Co addressing the members

during the MMA–KAS Talk on ‘GST

Annual Return (GSTR-9) and GST

Audit (GSTR-9C)’ for the financial year 2017-2018

Dr V Chockalingam, Emeritus

Professor, Cadiology, Dr MGR Medical

University, Chennai addressing the

members during the talk on ‘Manage

your Stress for Success’. Mr C Siva

Kumar, Member, MMA Managing

Committee chairing the session

business mandate | january 2019 page 1 of 48mmachennai.org/banner/mandatepdf/mandatepdf25.pdf ·...

Documents