Showing posts with label iipm-article. Show all posts
Showing posts with label iipm-article. Show all posts

Tuesday, October 09, 2012

Let us now tighten our ties...

...for tightening belts alone won’t work! Some of the world’s leading companies face testing times in 2009

Leaders are meant to set the pace and make others follow. But the way leaders (beyond usual suspects like the Detroit trio) in diverse global industries are faring in this economic ‘winter’, we are hoping that there aren’t too many followers in that sense! While 2008 was seemingly difficult for them; 2009 too hasn’t brought much relief. As the misery of these leaders continues, we take a look of what is (or rather should be) their resolution for 2009.

Sony Corp. is one of the leading sufferers, which is expected to report its first massive loss of a whopping $1.1 billion in the last 14 years! Richard Ptak, Managing Partner, Ptak, Noel & Associates, avers, “Strong Yen versus weak Euro and dollar made their products expensive and the meltdown in US and European markets further augmented the condition.” From the same land, Toyota Motor Corp. too slashed its net profit forecast for the year ending March 2009 to ¥550 billion (half its earlier projection of ¥1.25 trillion). It has also decided to halve its domestic production to 9,000 units per day, after it suspended 12 factories for 11 days in February & March to balance inventories.

Arcelor Mittal – world’s largest producer of steel, was forced to cuts its steel production by almost 30% due to falling steel prices, dampening steel demand in US, Europe and other emerging markets. What was once the world’s largest bank, Citigroup posted Q4 losses to the tune of $8.29 billion, twice as much as analysts’ expectations. Such is the predicament of Citi, which following the enormous loss, Vikram Pandit, CEO, Citigroup is contemplating to split the multinational bank into two separate units. Blue-chip company Intel has also warned that its Q4 results will be $8.2 billion, below its guidance of $9 billion issued in November. The forecast was made on the basis of fall in end-consumer demand. Time Warner Inc. – New York-based media conglomerate, owing to credit crisis and fall in advertising revenues, will have to undergo impairment charges of $25 billion by writing down the value of its publishing, cable and Internet businesses.


Source : IIPM Editorial, 2012.

For More IIPM Info, Visit below mentioned IIPM articles.
 
IIPM : The B-School with a Human Face


 
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Wednesday, September 05, 2012

Marvel at the Mahals where they lived and bite into kebabs

Wander in the streets where Nawabs once walked, Marvel at the Mahals where they lived and bite into kebabs that were created especially for the royals; you just might find the city of your dreams waiting for you, here in Lucknow

With its imposing Deewan-e-Khas, a large number of chambers and many basements with access to strategic tunnels, it prompted some European writers to compare it to the garden of Arabian Nights. There’s Shatkhanda, a five-storied replica of the Leaning Tower of Pisa. The Hussainabad Clock Tower, proudly declared by Lucknowites as the Big Ben of India, is a 221-foot high, 20-square feet tower with a 14-feet-long pendulum. The wheel of the clock is 18 inches in diameter. On its four faces, the tower exhibits four clocks of 13 feel diameter.

The Husaianabad Imambara, built by Badsahah Mohammed Ali Shah, Awadh’s third ruler, stands in an architectural complex known as the Babylon of India. A visiting Russian Prince in fact once referred to it as the “Kremlin of India”. It bears the tombs of its builder and his mother enclosed in silver grills.

The Asfi Imambara, a blend of Mughal, Rajput and Gothic styles, is an architectural miracle built without the traditional support of pillars or beams.

Cooking was raised to the highest standards by the nawabs. The food was an eclectic mix of Persian and Mughal dishes, often with a European twist. The city’s elite encouraged experimentation by their well-paid cooks who among other things invented the Dum Pukht style of cooking. While the nan jalebis and the sheer mal were breads which first came out of the kitchens of the nawabs, the humble parantha was refined into the baqar khani. Some of Lucknow’s must-eats include Tunde ke kebab, Wahid’s biryani, Rahim’s Kulche-Nahari, Pandit Ram Narayan’s Chaat, Radhey’s malai gilori and Bajpai’s Puri Kachori.

Spoiled yet cultured, modern yet traditional, like the reflections on the many mirrors of Sheesh Mahal, every person sees a different image of Lucknow. What perhaps binds their vision, is the city’s glorious past and the common dream of a future just as bright.


Source : IIPM Editorial, 2012.
For More IIPM Info, Visit below mentioned IIPM articles.
 
IIPM : The B-School with a Human Face
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Monday, September 03, 2012

Lookout for animes’ invasion of Indian homes !

The anime industry is surely set to grow in India, but many mothers are anxiously monitoring excessive anime viewing, stating the programmes are not good enough or even too aggressive in nature. The Shin Chan series was banned in India in 2008 on grounds of the undesirability of its content. The Hindi version of Manga and Japanese anime that entered India in 2006, although became popular with kids here, its ill effects felt due to the character’s mischievous acts, soon went out of hand.

Despite these minor setbacks, the outlook remains positive as Kojira Uchiyama, Director, Japan Information Centre, who we met during the festival, is optimistic, as he shared, “Japan is known for its animation due to its good quality. Since the popularity of animation has increased over the years all over the world, we wanted to let more Indians know about Japanese animation.” When he came to India two years ago, he was pleasantly surprised to find the prevalence of anime on Indian television. Having grown up watching Astro Boy, like all children in Japan, Uchiyama smiles and confesses his fondness for animation.

Anime is not just for children but it’s a tool, which is widely used by people of all age-groups – from story-telling for toddlers to fulfilling bizarre adult fantasies or fetishes about women. In fact, the Japanese have even gone on to cook-up a story idea for even mundane activities like baking bread and desserts! Keep your eyes wide open for new creative expressions in the baking right here in India too!


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Thursday, August 23, 2012

A WHOLE NEW AGE OF CORPORATE DHARMA

BE IT LEE SCOTT, RICHARD PARSONS, AKIO TOYODA OR HOWARD SCHULTZ, CEOS OF THE WORLD TODAY CAN ONLY IGNORE STAKE HOLDER ACTIVISM AT THEIR OWN PERIL

It started as a movement and soon became an industry. Today the activism ‘industry’ is composed of individuals and organisations that, in fact, make a living from activism. In the middle of all this, organisations consistently face the heat whenever they make a wrong move; be it deliberately or otherwise. Larry Ellison, CEO, Oracle, once famously said, “A corporation’s primary goal is to make money. The government’s primary role is to take a big chunk of that money and give it to others.” But with the rise in activism globally, the expectations and calls for accountability by organisations have clearly grown. B&E takes a look at some of the prominent stakeholder groups globally that keep the activism torch burning bright.

Shareholder Activism: Boon or Bane

In this unquestionable era of globalisation, shareholder activism undoubtedly has a huge impact. These activists are strategically and operationally involved in the companies where they have vested financial interest. Managements of large corporations are severely constrained with their decision making on even short-term (and at times, day-to-day) operations when these activists enter the game. An activist investor may only need to secure a 10-15% ownership stake in large companies in order to place a disproportionate amount of pressure on management, especially considering the average attendance in shareholder meetings. Shareholder activism has been subject to a lot of criticism and a number of cases have been in the global limelight. In 2006, renowned shareholder activist Carl Icahn led a group that called for the breakup of Time Warner into four different companies, cost-cutting efforts and stock buyback worth $20 billion. Eventually the group won concessions, including the $20 billion stock buyback, $1 billion in cost-cutting measures and the appointment of a new board of directors. In another case where Carl Icahn was involved, Genzyme, the world’s biggest maker of enzyme drugs for genetic diseases was last year, was forced to close down production because of alleged manufacturing plant contamination. During the fourth quarter, Carl Icahn owned Icahn Capital LP more than doubled its Genzyme stake to 4.8 million shares, when they started dropping due to the factory problems.

A research conducted in 2008 by the Ohio University documents a 59% success rate for Carl Icahn with respect to achieving his stated goals in his target firms. In an article published by the Wall Street Journal titled ‘Why Carl Icahn is bad for investors’, Prof. Lynn Stout says, “Shareholder activists that corporate boards fear most today are hedge funds like Mr. Icahn’s: unregulated pools of wealthy investors who take large positions in a few select companies, use their ownership position to pressure boards into strategies they claim unlock ‘shareholder value,’ and then dump their stock as soon as the price rises.” He also confirms that a common goal of an activist campaign is to see to it that the target company is sold off to a private equity firm. This also leads to fewer good public companies to invest in for shareholders. Shareholder activism can at times be also healthy. A report published by IPREO in 2007 on shareholder activists shows that 50% of investors who participated in the survey believe that activism is helpful depending on the situation. In cases where the activist’s intent is right, they should work together towards a win-win situation.

Blog and Consumer Activism

Evelyn Murphy, who was the Lieutenant Governor of Massachusetts from 1987 to 1991, once quoted “Corporations will keep doing things the way they’ve always been done, unless they face ongoing public scrutiny, or a real threat to their reputation and self-respect.” Globally, ethical consumerism is a market on its own, and has been growing at 14% per annum. The latest edition of the Ethical Purchasing Index values this market at around $34 billion. Consumer activism is a very old phenomenon, as old as the origins of the word ‘boycott’ in Victorian Ireland. Such movements are known to spread geographically from an epicentre. And this epicentre is now increasingly moving online. The internet has taken consumer activism to new dimensions as information can be exchanged from anywhere. According to China Internet Network Information Center, China will overtake US in terms of Internet users in another five years. Similar is the case with other developing nations around the world where disposable incomes and internet penetration are on the rise. The latest example of backlash against a giant corporate house from the public is Starbucks. Banking on the boom in coffee houses, Starbucks became the undisputed leader. Due to corporate clout and deep resources it was able to overthrow many mom and pop coffee start ups that tried to make their presence felt. But in Kansas city, Starbucks is facing some heavy competition; simply because coffee lovers are now supporting the once struggling coffee start ups. It so happens that whenever there is a coffee shop that seems to be doing good business, it either is acquired by Starbucks or a fresh Starbucks outlet pops up in the vicinity. Starbucks says that it has no such strategy but some evidence does exist to indicate that this happens. This pattern is attested by the Specialty Coffee Association of America. Allegations that it does not pay coffee farmers adequately are also affecting brand equity.


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Monday, August 13, 2012

Winners ideate

What nanotechnology can do!

Finally, nanotechnology is all set to revolutionise the age of modern technology. For the uninitiated, nanotechnology is old age manufacturing with new age atoms. The Centre for Responsible Nanotechnology observes that this technology will help in making new nanofactories that will produce any product rapidly, cheaply, and cleanly. Technically, it is a revolutionary, transformative, powerful technology. But more importantly, it can be potentially either very dangerous or extremely beneficial.

Going by statistics, investment in nanotechnology has increased exponentially in the recent years. According to a nanotechnology development blog, investment in nanotechnology research was over $8.6 billion globally in 2004, which increased to $12.4 billion in 2006; the area accounted for $50 billion of global sales in 2006. Countries investing heavily in nanotechnology are the US, Germany, Japan and South Korea. But China is rapidly emerging too. Nanotechnology is of particular interest to China to maintain itself as the manufacturing hub of the world. While the US is the leading investor in nanotechnology with 28% global share, others include Japan with 24%, Western European countries with 25%, and the remaining being accounted by other regions, including Asia, Canada and Australia.


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Saturday, August 04, 2012

BCCL: DHANBAD

BCCL township have undergone paradigm shift in the last four decades, but not all is well. Gyanendra Kumar Kashyap reports… 

Things have certainly changed. I remember when I last visited the township in March 2005, there were no security guards and the mere presence of them near the entrance instilled in me the question of Naxalism and its allied threats. Sukhdev Prasad, a retired CISF personnel, shares his views, “There are no threats from Naxals. But BCCL has taken the necessary precautions as there have been some alarming cases of burglary in the township.”

All seemed well so far. But an unexpected interaction with a trade union leader provided me with a contrarian view. “As an employee, I am happy that my salary has increased seven-fold in the last 14 years but (he claimed he speaks for the workers) a number of decisions of the government have been superfluous and fabricated,” he said. He went on to add that there is a manpower deficit (he said that the total employee strength is 70,000 as against the mandated figure of 170,000) and that contractual labour constitutes more than 50% of the workforce. He continued that the physical infrastructure needs to be taken care of while medical facilities need further improvement. But he also agreed that he has seen the aspiration levels of people around him increasing over the last decade and a half, and that that is a good sign.

Lives have definitely changed in the last 40 years, but there is a disgruntled lot that BCCL needs to do its bit to assuage. And that lot doesn’t need much to become satisfied.


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Tuesday, July 31, 2012

Stratagem-INTERNATIONAL

In the case of Apple, however, the opposite seems to be happening. Apple is finding ways to add its own flavour to a host of technologies through its vertical integration strategy and is using this to produce the differentiated products that we all love. One of its advantages is in its shorter lead-times, which are enabled by not having to talk to all sorts of suppliers before getting things done. Another advantage is its ability to design products containing its own components, a classical vertical integration strategy. This helps Apple turn received wisdom on its head. Google now appears to be trying to take a leaf out of Apple’s book by becoming more vertically integrated. Will it succeed?

This is a difficult call. But several arguments weigh against Google’s decision. First, Google is effectively following the herd (Apple) here. Playing a game of catch-up is always difficult, and particularly so when the firm you are trying to catch up with is as successful as Apple. Second, it is not clear Google can be a successful manufacturer of mobile devices. Unlike Apple, it lacks any background or experience in the production of goods and thus has not been able to build up the capabilities needed to be successful in that game. Firms, which outsource, need to have sufficient capabilities to monitor and manage their suppliers effectively. But firms, which vertically integrate activities, need a strong ability to undertake the activities on top of this. If they do not have this, they might be better off outsourcing the activities. Third, one way or the other, by becoming a hardware producer Google will start to compete with the other users of its Android mobile operating system, such as Samsung and HTC. It is difficult to see how that can make everybody happy at the same time, particularly if growth rates in the smartphone segment start to decrease, as they inevitably will, and Android manufacturers start to compete harder.

Finally, it is not clear whether there will be any consumer response to Google’s new strategy. Are consumers happy to buy a mobile device from a firm which already holds much of their data? With pockets as deep as Google’s you can probably afford a gamble financially, and the Motorola takeover will also give Google an interesting addition to its patent portfolio, but there is a downside to this particular deal that Google will hope does not materialise. If it does, outsourcing might have been better than vertical integration after all.


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Thursday, July 26, 2012

Is Honda Losing Steam?

Failure to Refresh its Offerings has Cost Honda dear, which has Lost Sales and its Leadership Position in The Executive and Premium Cars.

After the earthquake and tsunami ravaged Japan on March 11, the loss to the country has been beyond thousands of innocent lives. The Fukushima nuclear crisis triggered a loss of 1.25 trillion yen ($15 billion), forcing the exit of Masataka Shimizu as the President of Tokyo Electric Power Co., Sony Corporation faces a loss of a possible $3.2-billion in the just-ended fiscal and Japanese automakers have announced production cuts that is certain to bleed their bottom lines. Indeed, the past few months have proved to be one of the worst in the history of Japanese business. Out of all, the Japanese automobile industry, famous the world over for its just-in-time manufacturing, has been one of the worst hit. While Toyota lost its numero uno position as the world’s biggest seller of cars to GM — it sold 1.79 million vehicles worldwide in the first three months of the year (down 12% from the first quarter of 2010) as compared to GM’s 2.22 million — Honda was struggling to keep its business together in many major markets, including India.

Honda’s Indian arm, Honda SIEL, sold 1,990 units in the month of April 2011 logging a negative growth of 43% as compared to 3,507 units sold in the corresponding period in 2010. Following in the footsteps of its Japanese peers, Honda also announced a production cut in the Indian market necessitated by the limited availability of critical auto components from Japan. It was Toyota, which first announced a 70% cut in production. Honda followed with a 50% cut in production as both companies depend hugely on the imports of critical components like transmission systems and engines. Honda produced 3,530 cars in the month of April 2011 with a negative growth of 6.2% as compared to 3,767 units produced in the same period in 2010.

However, for Honda SIEL, the bad news is not limited to only the adverse impact on its supply chain due to the natural calamity in Japan. In fact, it also continues to lose ground to the competition in India. Much before the natural tragedy struck Japan, Honda’s Civic and Accord models had already lost their leadership positions in the executive and premium sedan segments to Toyota Corolla and Skoda Superb respectively. For the month of April 2011, Civic sold 253 units as compared to 776 units sold by Corolla. The situation for Accord is slightly better as it is still the second-largest selling car in its segment. Honda sold 194 units of Accord in April 2011 and trails behind Skoda Superb, which sold 243 units in the same period.

The current sales situation is a matter of concern for Honda which, after having established its presence in the sedan segment during 16 years of its existence in the Indian market, is now seeing its dominant position slip away to rivals. Its experiments in the hatchback and SUV segments have not been able to fetch high volumes for the company. Its hatchback Jazz failed to excite consumers, largely because of the hefty price tag as compared to the competition, which offered similar benefits at a lower price point. Honda sold 4,862 units of the Jazz in FY 2010-11 while relatively new products like Volkswagen Polo and Nissan Micra sold 28,904 and 12,302 units respectively. Similarly, CR-V, with its petrol only variant on offer, was not able to attract consumers for long amidst the rising competition in the SUV segment. The 22 units of CR-V sold by Honda in the month of April 2011 was worth peanuts as compared to 739 units sold by the segment leader, Toyota Fortuner.


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Tuesday, July 24, 2012

Stratagem-GOVERNANCE:2G PROBE

With both The Joint Parliamentary Committee and The Public Accounts Committee now Investigating The Infamous 2G Spectrum scam, a fresh dispute over The Scope and Jurisdiction of The Committees could hamper the very Idea of Initiating a probe into The Biggest loot that India had Ever Seen. 

Also, the JPC or the PAC can only look at the documents and examine ministry officials who testify before the committee. The parliamentary committees can arrive at independent conclusions based on documents placed before them and members of the committee can only place dissent notes if they do not agree with the majority. Furthermore, prosecution of individuals and cancellation of licences are executive functions which can only be initiated by the government. A JPC report can recommend the prosecution of a particular person or the cancellation of certain licences. However, the government can always disagree with the JPC’s findings and refuse to take action.

In another development, in a letter addressed to the JPC members before it met on March 24, JPC chairman Chacko asked them to intimate any pecuniary or other interest on subjects to be enquired by the committee. Chacko’s letter follows reports that some Congress members had raised questions on the tenability of the presence of 2 former BJP Ministers, Yashwant Sinha and Jaswant Singh, in the committee. As the Finance minister in the Atal Bihari Vajpayee government, Sinha presided over the Group of Ministers (GoM), which went into the issue of fixed-service providers being allowed limited mobility.

Jaswant Singh was a member of the group. Congress has asked how the two would be able to judge the decisions that may have been taken by the GoMs of which they were a part. The BJP, however, has questioned the rationale of the members of the Congress on the ground that they had no ‘personal’ conflict of interest on the mentioned telecom related issues.

The issues of accountability, transparency & governance are huge concerns for the UPA government. With the probe now extending to the tenure of the NDA government as well, we wonder whether the findings of both these committees, set up to investigate the scam in detail, will only be a cover up or not.


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Friday, July 20, 2012

Accept or Reject without a Reason

The Term “Accept or Reject without a Reason” Is The most Misused term across Government contracts – and for Shamefully Corrupt Purposes

Without even one iota of doubt, there is an urgent need for the government or the judiciary to pass strictures against this clause and ensure that the power to accept or reject contracts is via transparent means and not through unilaterally decided arbitrary decisions that cannot even be questioned at a later date. Just look at the putrefied list of our gloriously corrupt government representatives and you start understanding why this clause has become a debauched, unethical entity.

AICTE’s Chairman R. A. Yadav was suspended in 2009 under a corruption case, while AICTE member secretary K. Naryan Rao was even arrested. In the same year, former Jharkhand chief minister Madhu Koda was arrested in a case of disproportionate assets. Ramachandran Nair, CEO, LIC Housing Finance was arrested in 2010, again on charges of bribery charges. A. K. Srivastava, CMD, Nalco was arrested in February 2011, of course, on bribery charges. Secretary General of CWG organising committee Lalit Bhanot, former telecom minister A. Raja, and more, the list simply does not seem to stop.

Our proposed solution to resolve corruption by getting rid of the clause, obviously sounds too simplistic by itself. But wonderfully, the most complicated problems in the world have had quite simple solutions. With the government running away from owning up to the issue, it’s obviously the judiciary that has to get working. Well, we guess even the judiciary has to clean up its house first of all. The Tis Hazari Courts, in their tender for purchasing aerosol insecticide, writes, “The Purchase Committee reserves the right to accept or reject any tender without assigning any reason whatsoever.” Way to go judiciary, way to go!


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