The Edge

Vol-III, No. 4,

October 2006

FROM THE DIRECTOR’S DESK Our struggle for peace would be prolonged, full of pain and sacrifice.

Swami Vivekananda

The world is perceptibly a more violent place today. Terrorism has spread to an extent which has started affecting the public and private life of every individual. How are the B-Schools responding to this challenge?

05

A UNIVERSAL RELIGION

07

INDIA INC MAKES FOREIGN FORAYS

09

FUNDING GLOBAL ENTRIES

AACSB International realized that as thought-leaders, B-Schools have a role to play in this changed surcharged global environment. But it was not obvious what that role should be. To articulate that role as well as to see how B-schools, atleast the progressives among them, are responding, it constituted a Peace Through Commerce Task Force. It sought information from all its member B-Schools on how they have or plan to respond to the theme of Peace through Commerce. IILM Lodhi Road had also participated in the Survey.

The results of the Survey have now been brought out in the form of a Report 'A World of Good: Business, Business Schools and Peace. The study has aptly illustrated the need and contribution of commerce in conflict-plagued areas and the efforts of the management educators to develop relevant programmes. The study is replete with heart-warming examples of individual faculty members and members of the students community getting globally engaged in peace through commerce initiatives.

We are lacking very much in India in this regard, though our needs are no less than anybody's. It is time that Indian B-Schools wake up.

At IILM, we are trying to introduce some activities towards this objective.

B. Bhattacharyya

The www.iilm.edu

Edge

CONTENTS IILM’s INHOUSE MAGAZINE FOR LIMITED CIRCULATION Vol-III No. 4 October 2006

04 12 14 16 19

LETTER TO THE EDITOR

28 42 48 49 50

THE HR ANGLE USING THE IT GLUE BEING PROGRESSIVE IS KEY THE RIGHT LESSONS

21 24 31 32 38 EDITORIAL BOARD Mrs Malvika Rai Prof. B. Bhattacharya Shree Dina Nath Mishra Pradip Chakrabarty Disha Dubey

STUDENT CORNER QUOTE UNQUOTE CONTINUED ACADEMIC EXCELLENCE IN IILM CAMPUS NEWS

SHINE & THE SMEAR MARKETING BUSINESS EDUCATION IN INDIA INDIA CALLING GLOBAL INDIAN COMPANIES BOOK REVIEW

EDITORIAL TEAM Vishal Goyal Harleen Kaur Bhatia Aakansha Mehrotra Abhinav Dandia

Design: SUNIL KUMAR

THE IFRS EDGE

CLOSE ENCOUNTERS OF THE WRITTEN KIND

Published by IILM, 3- Lodhi Institutional Area, Lodhi Road, New Delhi- 110003 Phone: 91-11-43559300 Fax: 91-11-43559390 Printed by Avantika Printers Pvt.Ltd. 194/2, Ramesh Market, Garhi, East of Kailash, New Delhi - 110065

EDGE IS INSIGHTFUL I thank Prof B Bhattacharya, Director IILM, for sending me the quarterly magazine Edge which carried a write-up on me along with other global Indians.

I found the articles in the magazine insightful and thought-provoking.

Ajay Piramal Chairman Nicholas Piramal India Limited

RTI ACT IS POWERFUL TOOL FOR CITIZENS Information is power. In a democracy like India, where citizens are supreme, we need to respect the need of the common man.

The need of the hour is to act and implement RTI Act in totality without any amendment.

The RTI Act refers to right to information and a right can only be provided in a democratic country. The function of a Government is to develop the democracy in the country, their function is not to snatch the rights conferred to its citizens.

We Indians have only few rights out of which some are in force or in effect, if the Government still tries to remove these rights it means they are not practising and nurturing democracy rather it is inching towards autocracy.

RTI provides easy, effective and timebound solutions to the problems of people, the problems which have arisen due to illgovernance by our politicians and public servants.

We have numerous success stories people who have benefited from the RTI - like Mohammed Irfan who had applied for passport on 01.12.2004. He kept on contacting different authorities for one-and-a-half years but got no response. Then he applied through RTI Act on 07.08.2006.

He got his passport on 18.08.2006.

Even the high and mighty who use their position for wrong ends fear this Act. In January 2006, the Rai Bareli DM illegally constructed two shops in the collectrate premises. An activist submitted an application under the RTI Act. But there was no response. He then appealed to the UP State Information Commission and both parties The

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LETTER TO THE EDITOR were summoned on 13-07-2006. Suddenly the DM bulldozed the two shops on 11/1207-2006 and submitted a report to the Commission that there were no shops in the collectrate premises. This is the power of a citizen under the RTI Act. No amendment should be made to this Act and the common man should be made more powerful by spreading awareness about it.

I hope that better sense will prevail on the Government and it will set aside all the proposed amendments to the RTI Act, which is the greatest tool for a common citizen to fight for his rights, and weed out corruption.

Manoj Sharma Fellow , IILM

RANG DE BHARAT August 20, 2006 was an interesting day for me. I watched TV the whole day as the electricity supply was benevolently uninterrupted. I watched Rang De Basanti for the first time, the CNN-IBN poll on the state of the nation, the Great Indian Wedding on Travel and Living and, of course, the news about milk-drinking Ganeshas and celestial water on a Mumbai beach.

Indeed, this day gave me a glimpse of Bharat - a country of a million hues. What makes us different and what ties us together? What are our aspirations and apprehensions? I can answer these questions based on my TV watching on August 20, 2006.

Let me first address the issue of what ties us together - corruption. From Kashmir to Kanyakumari, from Gujarat to Bengal, one facet of life that we all experience in more than undesirable proportions is corruption/harassment. Rang De Basanti portrayed corruption in the Defence Minister trying to hush up allegations of defective airplanes that ultimately led to the death of a young pilot, and in the 'moral' police trying to dictate what to wear to the urban youth.

What also ties us together is our disillu-

sionment with this evil. No society is perfect, but we are the ones who can make it better as rightly pointed out by one of the protagonists of RDB. The second issue is what makes us different. The CNN-IBN anchor answered this question by differentiating between the terms 'India' and 'Bharat'. 'India' means the English-speaking, jeans- and Tshirt- wearing and McDonalds going population. 'Bharat' means the non-English-speaking, kurta-pyjama-clad and lassi-drinking segment. These outward differences do not matter. What matters is that there is a 'Bharat' that is lagging far behind 'India' in terms of mobile phone ownership, computer literacy and awareness (according to the CNN-IBN poll).

What matters is that the farmers of 'Bharat' are committing suicide, while the corporate honchos of 'India' are thinking about their next big take-over. What matters is that 40 per cent of respondents of the CNN-IBN poll celebrated Independence Day for the first time on August 15, 2006!

Talking of aspirations, the youth of the country ranked career on top of the list (in the poll). No wonder we are producing millions of science, engineering and management graduates, only a minuscule of whom is actually contributing to his field, and even a smaller section contributing to the uplift of 'Bharat'.

Why aren't we able to make hundreds of contributions (by writing top class papers or by inventing new things/ideas), if not more?

Apart from India losing a cricket match on the last ball to Pakistan, our greatest apprehension is to travel on an unknown path‌. the path of Gandhiji (although 76 per cent of the respondents considered Gandhi as their role model) or the path of Mother Teresa (65 per cent considered her as their role model).

India and the world at large, would be a much better place if we sometimes followed the path less travelled. We are an extremely tolerant nation, but let us not tolerate corruption, ignorance, injustice and inequality in any form and at any place. We must act and the time is now. Films like Rang De Basanti remind us that there is a long, arduous path ahead of us.

Joydeep Ghosh Fellow, IILM

PEACENIK

A UNIVERSAL

RELIGION V

ivekananda burst into the Western consciousness in the World Parliament of Religions at Chicago during 1127 September 1893. What did Vivekananda say which brought him the world’s ovation? How relevant are these to us now?

Reading the speeches Vivekanada made, one B. Bhattacharyya would realize he emphasized essentially three Director, IILM points. First, religion and scientific knowledge complement each other. In fact, religion encompasses science. Second, there is a uniqueness in Hindu philosophy, as distinct from other major religions. And third, all religions must learn to coexist peacefully.

Vivekananda had a modern mind.

He could relate, therefore, the then latest scientific theories to the eternal truth Indian sages discovered in the Vedic age.

This is what Vivekananda said: "Science is nothing but the finding of unity. As soon as science would reach perfect unity, it would stop from further progress, because it would reach the goal. Science of religion becomes perfect when it would discover Him who is one life in a universe of death, Him who is the constant basis of an everchanging world. Thus is it, through multiplicity and duality, that the ultimate is reached. Religion can go no further. This is the goal of all science". In fact, as

Vivekananda had a modern mind.

He could relate scientific theories to the eternal truth Indian sages discovered in the Vedic age.

Science, he said, was all about finding unity

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Vivekananda put before his audience the dream of a world religion ‘which will have no place for intolerance, will not be Brahminic, Buddhistic, Christian or Mohammedan but the sum total of all these……..".

This is a dream that can bring peace and prosperity

The

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Romain Rolland observed, for Vivekananda religion was the sum total of all knowledge.

Where does the uniqueness of Hinduism lie? According to Vivekananda, Hinduism is based on one basic principle: "Man is to become divine by realizing the divine". He explained that the Hindu system of beliefs is a "constant struggle to become perfect, to become divine, to reach God, see God and this reaching, seeing God becoming perfect even as the Father in Heaven is perfect, constitutes the religion of the Hindus."

And this struggle to become perfect has no substantive links to the numerous deities in the Hindu pantheon.

They are simply "the supports, the helps" in the initial phase of a Hindu's spiritual quest. In the beginning of our journey towards an understanding of the spiritual world, "the material world calls up the mental idea" by association. It helps in concentration, though the faithful knows, as does anybody else, that the image is not God. Vivekananda quoted the Vedi text: "External worship, material worship is the lowest stage, struggling to rise high, mental prayer is the next stage, but the highest stage is when the Lord has been realized".

Finally, as befits the principal disciple of Ramakrishna Paramhansa, Vivekananda preached the unity of all religions. “Every religion is only evolving a God out of the material man, and the same God is the inspirer of all of them”. All contradictions are only superficial, at surface; deep inside, they are the same as the famous dictum of Ramakrishna: 'Jata mat, tato

poth'. (follow any path, any religion, the goal is same). Vivekananda quoted Vyasa: "We find perfect men even centuries and, therefore, were never aggressive. It assimilated other religions but did never fight for its own supremacy. Vivekananda said "Do I wish that the Christian would become Hindu? God forbid". Do I wish that the Hindu or Buddhist would become Christian? God forbid. Vivekananda put before his audience the dream of a world religion "which will have no place for prosecution or intolerance. … . Will shine upon the followers of Krishna and of Christ……which will not be Brahminic or Buddhistic, Christian or Mohammedan, but the sum total of all these……..". This is a dream that can bring peace and prosperity in today's strife-ridden world.

In this post-modern 21st century, there are many who crave for ethical and moral values, independent of religious connatations. More than a hundred year after the Chicago address, leaders of all major as well as some minor religions congregated in the bingen to develop the Principles of a Global Ethic. The Declaration "invites all people, religious or not", to follow these principles because these are essentially based on broad humanistic ideals. The principles affirm that a common set of values is found in the teachings of all the religions and that these from the basis of a global ethic. 'We are interdependent.

Each of us depends on the well-being of the whole and so we have respect for the community of living beings, for people, animals and plants, and for the preservation of Earth, the air, water and soil."

BEYOND BOUNDARIES

India Inc makes foreign forays T

he economic reforms in 1991 Favourable policy initiatives — were initiated more as a restricting uninhibited flow of forresponse to the fiscal and eign capital, coupled with the freeforex crises than a growth stimulus. dom to Indian companies in creatThey also acted as catalyst in ing manufacturing and servicing unleashing the growth bases abroad, has meant potential of the Indian increased action on part of economy. As a follow up Indian companies in the to the initial set of M&A street. In the first six reforms, several meamonths of this calendar sures were initiated that year, 76 cross-border aimed at deregulating M&A deals worth $5.2bn the economy and were announced. This stimulating forcompares favourably with eign investment. deals valued at $4.7bn These mea(136 of them) recordRakhi Singh sures have cated in the whole of Fellow - Economics apulted India to 2005. Out of this, June the forefront. As 2006 has accounted the growth story of the decade for a total transaction value of $1.5 and as part of BRIC, it is now con- bn. sidered the future growth engine of The group of economists opposing the world economy.

FDI argued that the long-term burOpening up of the economy was den of repatriation of profits of forresisted strongly on the grounds eign investment would be more than that Indian companies might be the short-term gains. Also, they felt taken over by MNCs. But with the that opening up of the economy to benefit of hindsight, we can safely MNCs would not get us new techsay that M&A action has been two- nologies. They were in favour of 'opway and has been guided by effi- timal' opening of the economy to ciency motives. Indian businesses MNCs (though what is 'optimal' is have displayed the confidence to go itself debatable) and wanted global out and conquer the world. competition as a tool to encourage

FDI Inflows in India and China Country

Type of FDI

1991-96

1997-99

2000-01

CHINA

Inward Outward Outward/ Inward

25476 2571 10.1%

42759 2324 5.4%

45773 3550 7.6%

INDIA

Inward Outward Outward/ Inward

1085 75 7.05

2806 80 2.9%

3057 508 16.6%

Source: World Investment Report 2003

$ million The

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Indian businessmen to face up to which, in turn, can be used for working in terms of the dynamics of global competition. domestic growth opportunities. an open market. Calendar 2006 is The net impact of the two These companies hope to leverage expected to be a busy year for approaches has been a much slower their brands, services, processes Indian Auto industry, with many opening of the economy. It’s difficult and customer base to reach out to a high-end foreign brands entering to say whether this helped the larger global audience, besides beat- the country. At least 30 new launchgrowth of the economy or if Indian ing the downturn in one country. es, spanning from affordable hatchbusinesses would have survived a As we can see from the list of backs to mid-size models to super faster opening process. But as per companies, M&A activity is not con- luxury high-end cars and SUVs, are the current situation, Indian busi- fined to information technology (IT) expected during the year. nesses have successfully withstood and pharma sectors alone. Oil and But its not only foreign players the MNCs. offshore companies, paper firms, entering Indian market, but The positive outcome of the open- BPOs and power equipment manu- Indian auto companies too that ing up process is visible in the facturers, among others, have are moving aggressively into forincreasing levels of outward FDIs. joined the fray. eign markets.

As against inward FDI, outward FDI "Mahindra & Mahindra (M&M) shows a steep rise in recent years. has emerged as the fourth-largest Some of the big names on the tractor brand in the US in the 15-90 M&A street, include ONGC — a pubhorse power (HP) segment. It has an lic sector giant, Ranbaxy — one of assembly line for its Bolero range the leading knowledge-driven corpick-up vehicles in Uruguay. It will porates from private sector and launch new models in existing forAban Lloyd Chiles Offshore — a eign markets as well as new ones. home-grown exploration company "Tata Motors Ltd. commenced dis& a relative newcomer. tribution of Fiat cars across India as Some of the significant deals part of the new Tata-Fiat dealer outside oil & gas sector include the network and is looking at tapping BILT takeover of Malaysian Sabah overseas markets through the Forest Industries for $261m, partnership. It plans to re-launch Suzlon acquisition of its passenger car, Belgium's Hansen Indica, in the United Indian businesses have successfully withTr a n s m i s s i o n s under its stood the MNCs. The positive outcome of the Kingdom International for own brand. Indica $565m and Subex opening up process is visible in the increas- debuted in UK as City takeover of UKunder Tata ing levels of outward FDIs. As against inward Rover based Azure SoluMotors' tie-up with tions at $140m, Tata the BirminghamFDI, outward FDI shows a steep rise Coffee buyout of based MG Rover.

Eight O'Clock coffee chain and Automobiles Industry: Indian companies are expanding GHCL’s takeover of UK’s largest A case in point fast into Brazil, Indonesia and home textiles retail chain Rosebys The auto industry has been on an other developing nations with an for $40m. upswing for the past few years. At aim to provide leadership in indusIndian M&A activity has been dri- 20 per cent, India was the fastest trialization. Bajaj Auto is planning ven by CEOs who envision the world growing car market in the world in to set up its first plant outside India as their market and want to capital- 2004. This was followed by an in Indonesia. Another operation ize on any emerging opportunities. impressive 8.9 per cent growth in would take off in Brazil. It has They are aided by senior managers 2005-06. India is likely to emerge as plans to set up plants, acquire comwho are actively involved in identify- the world's largest manufacturing panies, vendor and distribution ing targets, negotiating and arrang- hub for small or compact cars, fol- networks and build brand to coming finances with merchant bankers. lowing the Government's decision to pete with renowned global players.

Indian CEOs have used M&A for cut excise duty on small cars. As per These developments indicate that geographical diversification and an industry, expected investment Indian auto brands may very well increasing the global reach. It has inflow by 2007 is $ 6.7 billion. rule the roost in not too distant also helped in generating more cash The Indian auto Industry is now a future.

The

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MONEY-RAISER

Funding global entries A

fter economic liberalizathe trend of acquisition of foreign tion which began in companies. Four years back, it 1991, corporate India has acquired UK's famous brand aggressively restructured itself Tetley Tea for $430 million. The by focusing on efficiencies and deal made Tata Tea the world's by inducing professionalism in second largest tea company. the management. This big Taking a cue from the Tatas, change in the mindset resulted other Indian compadue to greater exposure and nies began expandincreased competitiveness. ing their busiShweta Gupta Corporates successfully ness overfaced the challenges of going seas.

Fellow-Finance overseas and had their taste In January of business success. In sectors like telecom, 2005, when the Indian govauto, auto-parts manufacturing, pharma, ernment removed the $100 commodities many Indian companies have million cap on foreign become globally competitive. For example, investment by Indian compaTata Steel's acquisition of 5% stake in nies and raised it to the net Carboraugh Downs, an Australian coal worth of the companies, the mining firm, has managed to reduce the number and size of foreign input cost significantly. It makes a tonne of investment deals abroad increased steel for as little as Rs. 10,000 compared to manifolds. others who spend about Rs.12,000 to Financing these acquisitions 15,000 per tonne.

Finances for acquisitions At the same time, Indian corporates lack are mostly arranged the marketing and distribution expertise through global private overseas. In order to surmount and equity firms, Indian strengthen their presence they are focusing and foreign banks. on acquisitions and takeovers of US, For the first European and Asian companies. Factors like, increasing foreign reserves and uplifting of regulations and controls which earlier had made Indian companies to operate internationally difficult beyond exports, have facilitated the companies to go global.

Emerging Global Players It was Tata Group's Tata Tea that began

Corporates successfully faced the challenges of going overseas and had their taste of business success.

But at the same time, Indian corporates lack the marketing and distribution expertise overseas

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Some acquisitions by Indian corporates abroad & financing these acquisitions SECTOR/INDUSTRY INDIAN COMPANY

ACQUIRED COMPANY

DEAL SIZE

Consumer Goods

Videocon group

Thomson SA

Rs 1,260 crore

Tea and Telecom

Tata Group

Tetley, Tyco Global, and INCAT

$1.1 billion in total

Hotel

Tata Group

30-year contract to $50 million manage the Pierre Hotel

Hotel

Tata companies

Spice Market

NA

Auto ancillary

Bharat Forge Ltd.

Imatra Kilsta and Scottish Stampings

$57.5 million

Auto ancillary

UCAL Fuel

Amtec Precision Products Inc

$28 million

Pharma

Matrix Laboratories

22% stake in Docpharma $263 million

Pharma

Dr Reddy's Laboratories

Betapharm Arzneimittel

$573m

Pharma

Sun Pharma

Caraco Pharma Labs

NA

IT

I-Flex

Castek Software

34% stake in castek

IT

Goldstone Technology Ltd

Stay Top Inc

NA

Financial services

ICICI Bank

Investitsionno Kreditny Bank

NA

Financial Services

SBI

Indian Ocean NA International Bank (IOIB)

Energy

Suzlon Energy

EVE Holding

time in mid-2005, the Reserve Bank of India allowed domestic banks to lend money to Indian companies for overseas acquisitions. Since then, foreign banks and public sector banks are jointly financing such deals. Citibank and Standard Chartered have joined hands with several state-owned banks for this purpose.

But domestic banks and foreign banks are also competing. Domestic banks consider acquisition financing as a major revenue source, but face business barriers, as they can raise funds abroad only to lend domestic exporters. Therefore, any additional lending to Indian companies for overseas acquisitions can put pressure on their capital. Foreign banks have been quick to take advantage of this opportunity and are aggressively financing Indian companies for foreign acquisition deals.

Although some domestic banks are The

10 Edge

$565m

also active in this area e.g. ICICI has already completed several deals, including issuing a $60m syndicated

loan to Ahmedabad-based Dishman Pharmaceuticals and Chemicals for acquisitions in Europe.

Export-Import Bank of India has also funded acquisitions under refinance agreements. Under this banks were allowed to sanction term loans on merit to eligible Indian promoters for acquisition of equity in overseas joint ventures or wholly owned subsidiaries, provided the term loans have been approved by the Exim Bank for refinance.

Apart from arranging finances from lenders companies are also trying innovative methods of financing like Sajjan Jindal controlled JSW group has finalized the acquisition of a 200 million tonne coal mine in Mozambique wherein Jindals will pay a small token of $6 million which will be followed by royalty payments as they mine coal.

What made Tata's deal of Tetley Tea particularly special was the fact that it was the first ever leveraged buy-out (LBO) by any Indian company.

This method of financing had never been successfully attempted before by any Indian company.

Tetley's price tag of 271 mn pounds (US $450 m) was more

Some financing deals Indian Company

Acquired Company

Financers

Deal Size

Suzlon Energy

EVE Holding

Barclays Capital (UK), Deutsche Bank (Germany) and ICICI Bank

$565m

Tata Steel

Acquisitions in Southeast Asia & China

Matrix Laboratories Docpharma Dr Reddy's Laboratories

Betapharm Arzneimittel

than four times the net worth of Tata tea which stood at US $ 114 m. This David & Goliath aspect was what made the entire transaction so unusual.

What made it possible was the financing mechanism of LBO. In LBO, the target company's assets serve as security for the loans taken by the acquiring firm. The latter repays the loans out of the cash flow of the acquired company, i t s profits or by selling its assets. This mechanism allowed the acquirer

Seventeen banks facilitated the syndicate laon

$500m

ABN Amro(Netherlands)

$133m

3i (European PE Firm)

$573m

Apart from arranging finances from lenders, companies are also trying innovative methods of financing like the JSW group which finalized the acquisition of a 200 mt coal mine in Mozambique (Tata Tea) to minimise its cash outlay in making the purchase.

Conclusion Indian firms need no longer worry about being armed with sufficient money to fund overseas acquisitions.

Whether through the syndicated loans market or from private equity, they have far easier access to funds today. And this is one reason why foreign buyouts are gathering pace. In the first six months of 2006, there have been 85 outbound deals valued at $4 billion. Compare this with 2005, when there were 136 acquisitions valued at $4.3 billion.

Clearly, outbound acquisitions are outpacing in-bound acquisitions this year, both in volume and value.

What’s more, the appetite for risk is growing — the average cross-border deal size this year has increased to $47 million from $32 million in 2005.

Companies are not afraid to take over firms bigger than themselves. Take the cases of Tata Coffee's acquisition of Eight O' Clock Coffee or Subex's buyout of Azure Solutions. The deal values are higher than the revenues of the buyer.

The access to money has, thus, changed the mindset of Indian firms, making them more aggressive and willing to pay more.

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MANAGER’S DESK

THE A

HR

ANGLE

s Indian companies foray its underlying philosophy in foreign into global arena, manage- locations could be another reason ment of expatriate man- for MNCs promoting short-term or agers has emerged as a critical issue long-term expatriation. impacting the success of International assignments organizations in foreign serve as an excellent lands. An expatriate is opportunity for individual someone temporarily or managers to develop permanently residing in a international management country and culture other expertise. than that of their Expatriate management, upbringing or legal resialthough a wide-spread dence. The word comes activity and undeniably from the Latin ex (out of) significant, is performed and patria (country), poorly and often does Shweta Khanna and is sometimes not yield desired misspelt as ex-patriot results. There is an Fellow-HR or x-pat, due to its urgent need to look pronunciation. into the possible reaThere are multiple reasons behind sons for expatriate failure and to promotion of expatriation by global identify the role of the human concerns. A multinational corpora- resource manager in alleviating the tion headquartered in one nation situation. but having subsidiary offices across the globe would be required to ensure that the headquarters' policies are duly understood and implemented by subsidiary offices.

Expatriation then becomes a necessity for direct control and achieving integration. Further communication channels between headquarters and subsidiaries would need to be streamlined and improved. A common corporate culture across countries embodying the true spirit of the organization would be a true representation of a successful global giant. Expatriation serves as an important tool facilitating the development of a common corporate culture. Adequate representation of the headquarters and The

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The term 'expatriate failure' refers to a situation where an expatriate returns prematurely from a foreign assignment. There are both direct and indirect costs associated with expatriate failure. According to Tung (1982) numerous factors could be accountable for expatriate failure.

Also reasons for failure reflect certain national peculiarities. Broadly speaking, expatriate failure in the context of Indian organizations could be attributed either to familyrelated problems, cross-cultural adaptation, individual temperamen-

tal immaturity and lack of technical or managerial competence. Each of these problems could be linked to a selection error or the absence of proper pre-departure training on cultural issues and self-adjustment.

The inability of the spouse to adjust to the local environment, education of children and other familyrelated problems could emerge as one of the primary reasons for repatriation before the scheduled time.

In many cases, home-sickness and home country hangover exerts a negative influence on the expatriate manager's mindset and creates difficulties of adjustment in the new culture. Indian managers might be confronted with 'major cultural differences' in terms of eating habits and differences in work habits, lifestyle and values. The manger's personality, emotional immaturity and lack of motivation to work abroad may further perpetuate failure.

In view of the above, identifying suitable criteria for expatriate manager's selection and consequently imparting cross-cultural training becomes a crucial function of International Human Resource Management. An important parameter for judging the suitability of a candidate for undertaking a foreign assignment would be the technical competence expected of the postholder. A person-job fit based on technical ability and willingness to work abroad stands a far superior chance of success. Even though job related skills are an important determinant of success, emotional intelligence and cross-cultural adaptability are equally important factors impacting success in foreign lands.

Adjustment to a new environment which might be the opposite pole of the cultural continuum one is habituated to require a positive attitude, professional maturity, ability to deal

There are direct and indirect costs associated with expatriate failure.

Reasons for failure reflect national peculiarities. In the Indian context it can be attributed to family problems, adaptation & individual immaturity with change and ambiguity and emotional intelligence.Given their centrality in the respective decisionmaking process family , their needs and adjustment levels emerge as a

fundamental factor impacting expatriate management.

Moreover, rather than treating family as an encumbrance to be managed, families are allies who stand to gain as much from expatriation as the candidate to whom the position is offered and should be made a part of the cross-cultural training to be imparted pre-departure. The family situation in terms of life-cycle stage, children's education and the effect on spouse's career and job need to be evaluated before selecting candidates for foreign assignments.

The role of the HR department does not end with merely identifying suitable candidates and imparting cross-cultural training for foreign assignments.

All expatriate managers need to be closely monitored and provided suitable means for contact with home country. First impressions in foreign lands and work environments need to be fine-tuned to minimize culture shock .Performance management and compensation need a review.

Re-patriation following completion of assignment and the associated readjustment to the home country and reestablishment in the organization also go a long way in retaining good employees.

To conclude, one can say that even though expatriate management has received much attention in international HRM, the potential limitation of expatriates as an internationalizing force cannot be ignored. As companies go global, HR interventions need to be re- visited, understood and applied in the context of home country and host country effects and the paradoxical pulls of integration across cultures and the need to respond locally.

The

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MERGER POINT

Using the

IT

glue

M

Vandana Srivastava Fellow & Area Head-IT

The

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ergers and acquisitions have long played a vital role in corporate history. In India, they are a relatively new phenomenon. While a couple of decades back Indian companies were struggling to find a foothold in the global world, they are rapidly becoming a force to reckon with. Post liberalization and globalization, and aided by tremendous growth in information and communication technology, they are rapidly moving ahead into foreign countries and acquiring or merging with companies.

They have developed an insatiable appetite to consolidate and acquire in order to gain a competitive advantage. In the first nine months of 2005, the total size of mergers and acquisitions (M&A) in India was about $13 billion as against about $4.5-5 billion for 2004! Irrespective of the industry vertical financial & banking institutions, marketing companies or IT intensive companies like Wipro or Spectramind, M&A have become the new growth strategy of Indian organizations.

Other side of the story Statistics have shown that anywhere from 40 per cent to 60 per cent of M&As either fail outright or fall well short of the value they're expected to bring. Irrespective of the industry sector, the success of any M&A depends highly on a successful marriage of the corporate cultures and synergies

of the resources: people and technology, and the business process.

For many businesses, integration means absorbing the new units as quickly as possible by implementing a single system across the board. To oversee acquisitions and mergers, managers need keen project management skills that will help them organize employees and technologies within a short time frame. While the focus is often placed on the strategic and financial goals, an often ignored area of concern is the psychological, cultural, social and technological integration.

Integration Challenges & Role of IT The traditional view was that "companies plan, IT reacts". Till about a decade back, IT used to be the clean-up department, left to patch things together in the aftermath of a merger or an acquisition.

But as companies begin to reevaluate the role technology plays in their business, IT has been promoted to being a strategic decision-making player.

Today many businesses are so dependent for their very existence on information technology that the concept of having a business vision or strategy separate from an IT strategy makes no sense.

Whether it's merging or acquiring, a company needs to know how to integrate and implement information technology with their partners. The seamless integration is often the most difficult and time consuming phase of the entire process. If done poorly it can cause a deal to crash, or at the very least, incur significant time and financial costs.

Figure 1 reveals that IT integration is the most critical factor in the overall success of a merger and acquisition. Accenture research 2002 reveals that IT integration activities carried out throughout the lifecycle of a merger or acquisition contribute significantly to its overall success.

Companies with effective IT integration strategy are likely to achieve

better financial results and are more likely to describe the deal as a success.

The challenges faced by IT transition team in post merger period are many, as indicated in Figure 2.

Managing IT integration in mergers and acquisition does not merely mean an integration of software and systems, rather an amalgamation of the very business processes. Imagine a bank with highly IT intensive business tasks trying to integrate the business processes after a merger or acquisition. The longer it takes to integrate the business functions, the longer it takes for the organization to reap benefits from the merger.

As with all aspects of integration, speed and simplicity are crucial to making IT integration as effective as possible. The sooner two disparate IT infrastructures can be linked, the sooner other operational efficiencies can be achieved. It is therefore imperative that IT integration strategies be planned right from the beginning for a smooth transition.

Figure 2 The Pre-Merger Being forewarned is being forearmed. Planning for the changes associated with a merger or acquisition has to begin much before the actual partnership. The pre-merger activities involve: A complete due diligence of the IT infrastructure and processes. It entails taking a complete look at all the relevant sources of value and risk, and assessing the current state of IT of both companies including staffing, operations, business applications and the processes they support, and underlying technology infrastructures. This involves creation of an inventory that supports comparison of the two companies' IT resources. More structured and detailed these are, the better. It is useful to establish transition teams, with managers, which plan for the areas of investigation and discovery such as the hardware, standardization of application software, network

Internal M&A merger integration capabilites IT integration

13% 31% 26% 30% Management and leadership Cultural intgration/ adaptability to change

Figure 1

architecture, physical location and security issues, among others.

Training, which is not strictly an IT issue, has to be well planned. The planning for complete change management is done by the transition team.

Creating the vision of PostMerger Business Applications and IT

Infrastructure by identifying and closing any "gaps" between how IT operates in pre merger companies and how it must operate to support the business' vision of the postmerger company, in order to handle the changed business processes as a result of the M&A. Developing a Post-Merger IT Integration Plan. This plan contains the complete information regarding costs, benefits, schedules and required resources. Having a wellheeled post merger strategy in place with complete deployment schedule helps mitigate the risks associated with the change. A dedicated leader for managing change is a great asset.

He should already be operating at the same level as the CEO, the CFO and the COO. If used aptly, IT can play a vital role in the success of a merger or acquisition by making a company "ready" to blend with new partners and removing surprises.

After all, surprises are for birthdays, not mergers and acquisitions.

Integration of Cultures

33%

Resources / Personnel

22%

Recoganization

18%

Software Integration 16%

Sysems Integration

14%

Effect on Day-to-Day Business 8%

Poor Planning / Mechnisms Time Limitations

4% 0

5

Figure 2 10

15

20

25

30

35

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PROGRESS QUOTIENT

Being progressive is key T

wo desires have gripped the tion and globalization — to enter world in recent times — one, the global market and enjoy interto get globalized and the national standards and benefits. other to adopt economic liberaliza- This is an imminent task for develtion policies to attain that oping nations that goal. The enthusiasm of requires careful plandeveloped nations to capning, policy changes and ture markets of developthe introduction of better ing countries to enhance management methods to their business is encourmake an entry and a susaging developing nations tainable impact on the to make policy changes to global scenario. move towards a more Globalization is politiopen economy in order to cally defined as the forbenefit from such a mation of a nationDr. Madhusree Mazumdar phenomenon. state without boundBetween the issues, aries for carrying out Professor-MOUI/DM one is a means to economic activities, achieve an end and the other an especially trade and commerce — a end by itself. Of the two worlds of borderless world dominated by developed and developing coun- multinationals and financial martries, the latter will actually have to kets. The new actors to operate in a attain both — economic liberaliza- globalized world will be institutions

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like the World Trade Organisation (WTO), the international NGOs, the multinational and IT companies and the financial institutions, to be backed by a set of new rules of multilateral agreements on trade, services, outsourcing, intellectual properties and the like, supported by strong enforcement mechanisms.

While this would create better scope for employment, a conflicting situation can arise to widen the gap between the haves and the havenots, if individual capabilities are not upgraded to compete in the race for attaining international standards.

It can also reduce the scope to resolve urgent national problems like poverty, unemployment, social development and all those essential development goals that are crucial for strengthening individual nations.

A critical issue here is of enhancing human capabilities for improved productivity through better management and administration. It means that even though priority will shift from national requirements to international demands, at the micro-level human resource development and local management and administration ought to be improved to fulfill macro-level objectives.

Therefore, every country, especially the developing ones, will have to be cautious enough, to handle this mirage of contributing to the global market to

earn higher economic returns, by organization that results into reliimproving its management stanable and less costly output. It is a dards to attain its goal of strengthspecialized activity that demands a ening its own economic base. separate technique of management, Globalization also transforms which has hitherto not been taught space with time — an integration of in India, though the West has vennot just the economy, but also the tured to experiment with this culture, technology and goveraspect of management from incepnance. tion.

Though its normative base is the Peter Drucker, the management celebration of the market that "guru", whose death in recent past hopes to benefit all countries vertihas evoked reminiscences of how cally and laterally, it cannot be the study of management became achieved without creating a firm popular had once said that manplatform to sustain the vagaries of agement "deals with people, their the worldly woes like the tsunamis values, their growth and developand the hurricanes, not to mention ment, social structure, the commuthe market or the state failures. nity and even with spiritual conHowever, in this process of cerns". change, the State's role as a central Cornelis de Kluyver, dean of the actor will have to be reduced; disinPeter F. Drucker and Masatoshi Ito vestments will have to be encourGraduate School of Management at aged and privatization will have to Claremont, said: "What distinbe promoted. guished Peter Drucker from many Liberalization basically means other thought leaders in my mind is doing away with regulatory conthat he cared not just about how trols and inviting foreign investbusiness manages its resources, ments and ownership, which has but also how public and private its own pitfalls. Today the levels of organizations operate morally and economic liberalizaethically within socition are measured in ety" (The Times of terms of direct forIndia: November Developing nations will have to repriorieign investments.

2005). Hence develtize plans, deregulate industries, privatize What makes the opment is both a entire process of phenomenon and a public utilities & open up the economy to economic liberalizaphilosophy bringing foreign trade to cope with the situation tion difficult is the about a shift from dilemma to be faced traditional to modin the provision of ern, from backwardinfrastructure and public utilities, vices, downsize the government, ness to advancement, from historiwith the essential services to be reduce subsidies, open up the econ- cal past to prosperous future, from provided to one and all despite the omy to foreign trade, disinvest primitive social norms to modern society's inability to pay. equities of public sector invest- civilized society, all of which repreThe ethics of development is to ments and improve tax administra- sent a better standard of living and bring about equity in service provi- tion or whichever instrument it life. sion to all citizens, without any dif- may want to use to cope with the In terms of prosperity, developferentiation between the rich and situation. ment is an improvement in the flow the poor. Such utilities cannot be In this process of change the role of available opportunities. It repredenied to any citizens, however of development management sents a systematic, organized & much it might cost the government. becomes crucial, for development is balanced growth, which is a necesHence developing nations will have an essential aid to productivity, sity. It is a continuous link in interto reprioritize their plans, deregu- which is the sole reason for effi- national parity. It finances the purlate industries, privatize public util- ciency. chasing power, creates demands ities, commercialize public serDevelopment expects a scientific for goods and services and offers The

Edge 17

opportunities for an adequate suppractices from a system of authoriply of the requirements. Thus, ty to an availability of resource development is a reality, not a Thus development management dream that needs the support of is a system of cooperation, coordiplanning and management at every nation and integration to achieve level of governance. Development results, profits and social benefits is, therefore, the basis of all manto enhance qualitative values of agement and "development manmodern management that inducts agement" shares a social and a social elements into public responpublic responsibility to bring about sibility. It anticipates an ethical a qualitative change towards posicode as the guiding force in develtive growth. Development manageopment management vis-à -vis ment is, therefore, a comprehenmaximizing profits. This also shifts sive approach to efficient adminismanagement from ownership of tration of resources in an expandcapital and property to the maning economy. agement of social benefits emergThe focus of all management, ing out of economic operations. therefore, should be to develop new In consonance with the requireresources, new methods, new ments of management, the need plans, new approaches, new prodstudy of Development Management ucts and new lines of action. It is an through structured courses art of harmony, smoothness, coorassumes great importance. It adds dination and balanced distribution. value to the delivery of manageEfficiency of operations in the ment studies. It has been realized process of development needs an that to become better managers, effective managerial support. It is the students need to be sensitized only this support that allows a fruitto the social and the ethical aspects ful translation of policies into of management along with profitaction. making and economManagement is a ic growth models, so professional skill as to make manageDevelopment is the basis of management used for decision ment more sustainand development management shares a and action - two able. To induct this most important facsocial aspect to mansocial responsibility to bring about a qualtors that contribute agement is not an itative change towards positive growth to the success of easy task. Much any organization. It thought has to be put is a technique of in designing the result achievement. It is a goal-ori- expertise that the challenge of deci- Development Management Course ented supervision for performance sion-making and leadership that ought to include: appraisal in the context of the demand a tactful approach. Social Development (focusing expanding economy. It is manage- However, the challenges before on health and education) ment that is recognized as a medi- management are still more serious Natural Resource Management um of: when the managerial environment Urban Infrastructure a) Creation of wealth is changing rapidly. The current Management b) Generation of profit management problems are: Disaster Management c) Provision of employment 1. How to protect the social and Studies of the concerns listed d) Improvement of efficiency, and economic priorities of develop- above supplement the economic e) Progress of economy ment, along with the immediate and human resource management objectives of the organization courses. It will be worthwhile to Therefore, management perfor2. How to face greater public debate the issues that suggest the mance will have to be conducive to responsibility even in a private teaching of Development growth — it is at this stage of per- enterprise Management that helps in attaining formance based on professional 3. How to safeguard management the Millennium Development Goals.

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GLOBAL EDUCATION

The Right

M

Lessons

ore than two thirds Indians live many children from the rural backin rural areas. Studies in the past ground from entering these fields. These few years have shown negligible information gap is wider in the rural results of indivuals escaping from this areas than in the urban areas. How relicycle of poverty. Globalisation able, timely and plentiful inforand the growth of new opportumation can be made available nities have largely gone unnomore openly through instituticed by the educated youth in tional and the village. Most talented village indivualised channels are youth have dropped out somevery important. where along the line or they The software industry has have joined the workforce at the helped to equalize the availabillower levels of entry positions. ity of career opportunities in Their inability to derive ecodifferent parts of India. But it nomic rewards in proporhas yet to cover the rural Dr Shruti Singh tion to ability is a matter of India. This is where the Assistant Professor- HR considerable concern. But largest there is little done to see pool of the population how equality of opportunity can be better lives, close to 70% of all Indians live in promoted. rural villages. Yet talent in rural India The software sector or the IT sector is has not been rewarded with the opportuone who is in the fore front runner in the nities. When large proportion of nations post liberalization economic growth. The population are excluded from the range of recruitment pool of the software industry opportunities, the sum total of indivuals is primarily from the urban areas. The achievements is way below what can be rural population is under represented in achieved. the industry and the talent from these Misutilisation or non utilization of talent areas needs to be effectively tapped. is an important part of the complete Lack of information about the opportu- explanation for why India's per capita nities available is the biggest lacunae that income is lower than other countries. prevents How talent can be better

Education must be the focus of public intervention. This way our young population can become a huge asset when the rest of the world population is aging

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identified and developed and rewarded children aged between five and nine are is a critical question that has to be attending the school. Also the dropout addressed. rates in these schools are very high. , less Unless reasonable, workable and timely than half of the population who join class resolutions are devised and implemented, I actually complete class VIII and much we will fail in terms of economic growth less than 10% pass the higher secondary and in terms of equity. The quality of pub- examination. The situation is worse lic education in rural areas need to be because social and economic divisions in revamped and the availability of timely our society reduces further access to the and reliable education process.

Information will have to be enhanced.

This is also because of huge under proEducation and dissemination of informa- vision and poor quality provision in the tion goes hand in hand. government school system. The inadeEducation is one issue where we see quacy of basic infrastructure, non availconsensus amongst different political par- ability of teachers are active impediments ties in India. At one level education is one in the entire education process in our of the fundamental human rights, without country and these inadequacies are most which capabilities for a decent life and pre dominated in rural India. effective participation in society Unless emphasis is taken place are less likely to be develin the education process by oped. Therefore, all our the government on rural Industry citizens deserve equiIndia these impeditable access to a public ments will be mountwill benefit by havschool education sysing and create furtem of reasonable ther obstacles in the ing access to a wider quality. For a susentire development tained growth and and globalisation pool of qualified talent all round economic process. Lack of progress an educateffective functioning both from urban and ed labour force is of proper education absolutely essential. system leads to lack rural side And as economic tasks of information about become more complex different opportunities in and interdependent and the work or labour force of require different kinds of literacy our nation and leads to inability the importance of higher levels of educa- of rural India in participating in the globtion also grows. alization process. This creates a spiralling The creation of knowledge society is effect on the development and globalizabased on the realization that education tion aspect in rural India thus the governmust be a major focus of public interven- ment needs to focus on this with equal tion. Education is also important keeping concern and emphasis. in mind the 'demographic dividend'. This Industry will benefit by having access to is the fact that our relatively young popu- a wider pool of qualified talent both from lation can become a huge asset when urban and rural side. Government will most of the rest of the world population is benefit when poor people from villages aging and this difference in demographic develop greater stakes in city based ecostructure can create a large positive nomic growth. And rural communities potential for faster growth. Thus empha- will benefit when their more talented sis on rural India is imperative to see members achieve positions and can guide globalization at the local level. and assist others. Resolving the informaIt is in this sphere of equitable access to tion gap will help remove the critical barquality education for our people that we rier and improving the quality of rural have been conspicuously absent. education will have a great impact on According to the census only 56% of the globalization at the local level.

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SHOPPING ABROAD

SHINE & THE SMEAR T

he last few years have seen (24%). increased aggressiveness by The number of Indian companies Indian companies investing that are investing abroad has been abroad. India has traditionally steadily growing ever since the Tata always had a highly protective atti- Group successfully acquired UK's tude towards Indian Tetley Tea for $430 milinvestment, possibly lion four years ago. because of the view that According to KPMG, Indian capital should help Indian companies have India rather than other spent upwards of $1.7 bilnations. Further we were lion in the first eight dogged by a feeling of infemonths of 2005 for riority that Indian compaacquiring 62 overseas nies really can't compete companies. The IT sector, with multinationals banking and financial serabroad. vices and pharmaceutiShailey Dash All this has changed cal companies have Fellow-Economics dramatically over the been the most active in past few years. The M&A deals accounting value of overseas purchases by for 50 per cent of the deals.

Indian companies more than douThe Indian IT sector leads with bled to $9.3bn in 2004 from $4.5 bil- nearly 17 per cent of all acquisitions lon a year earlier, according to con- abroad in April-July 2005, followed sulting firm Grant Thornton. Foreign by Banking and insurance compaacquisitions edged up to $9.5 billion nies with 13 per cent of all mergers in 2005 and accounted for 60% of all and acquisitions, the pharmaceutiM&A deals by value. cals industry with 13 per cent and In fact, more Indian companies FMCG with 8 per cent. However acquired foreign firms last year than increasingly other sectors are also the other way around. The largest getting in on the act. share of Indian overseas acquisitions The trend towards acquisitions occurred in Europe (50% of deal began with the IT and BPO sectors. value), followed by North America The main motivation for these acqui-

sitions was to acquire clients and domain expertise, onsite presence and to grow inorganically in a shorter time. At least in the area of IT the acquisitions have not been large, typically ranging between $40-60m.

Wipro Technologies is one of the major shoppers and has bought four companies this year and is currently evaluating over a dozen. The biggest acquisition was made by Bangalorebased Subex Systems, acquiring UKbased Azure Solutions for $140m.

Surprisingly the biggest deals have not come from India's tech and outsourcing sector, which, analysts say, has a sound domestic business model and doesn't see the need to travel abroad but from the more traditional industries: telecommunications, pharmaceuticals, auto parts, and other manufacturing businesses that want to secure export markets.

For example the Tata Tea mega purchase of Tetley or the acquisition of global color-picture-tube business of France's Thomson (TMS ) with units in Mexico, Poland and China for $289.8 million by TV maker Videocon International Ltd. This makes the Videocon group the third largest colour picture tube manufacturer in the world.

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Though picture tubes are old technology, Videocon which is one of the largest manufacturers of picturetube glass, plans to supply its products to the Thomson operations and integrate the businesses. Other well known deals are: Tata Motors, buying up South Korean company Daewoo's truck plant in that country.

Reliance Infocomm's , takeover of Flag International, a major telecom network, for US $211 million which would give Reliance access to 50,000 km of fiber optic network worldwide.

Software giant Wipro Ltd has acquired US-based consulting company Nerve Wire for $18.7 million; Infosys Technologies, have bought up Australian software firm Expert Information Services Pvt Ltd for $23 million; Pharma major Ranbaxy has purchased RPG Aventis, the French generic wing of multinational Aventis.

What lies behind this sudden assertiveness on the part of Indian companies? Earlier, global operations for an Indian company meant plain exports. But now the definition has been expanded to include assembly and manufacture in foreign shores. In fact, many of the traditionally domestic market oriented large business houses are now turning their attention to global markets .This is illustrated for example by the Aditya Birla Group, which now has a presence in 18 countries and overseas revenues of $1.8 billion which account for 30% of its total sales.

The group employs 12,000 people in 20 countries with manufacturing

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Many traditionally domestic market oriented large business houses, like the Aditya Birla House, are now turning their attention to global markets.

Mahindra & Mahindra, for example, produces 100000 trucks annually at its US subsidiary activities ranging from carbon black, tire cord, viscose staple fiber, metals and chemicals. A spin-off of Indian companies taking the acquisition route for further growth is the trend of other corporates setting up greenfield ventures abroad. For example Mahindra & Mahindra is producing 10,000 tractors annually at its US subsidiary.

Indian assertiveness in the international arena has a number of factors underlying it. Firstly at the policy level many of the stringent regulations and controls which had earlier made it difficult for Indian companies to operate internationally, beyond exports, have been lifted. A key restriction lifted in January 2005 by the Indian government was the removal of the $100 million cap on foreign investment by Indian companies and raised it to the net worth of the companies.

Another reason for this sudden surge in India Inc's global acquisitions is the easy availability of dollars in India as a result of the government's policy of economic liberalization which began in 1991.At that time India had less than $1 billion in reserves whereas currently the country has healthy stocks of foreign reserves, totaling $140 billion.

Thirdly, according to The Economist the strong performance of the Indian corporate sector is another factor leading companies to expand aggressively. The average net profit margin for a sample of 420 companies rose to nearly 9.2% in the first quarter of the 2006 financial year from 8% a year earlier. In the liberalized environment firms are also facing increasing domestic competition Rising competitive pressures are also prompting Indian companies to grow rapidly through acquisitions.

Another possible reason is that there is a big change in mindset that has come about as a result of greater exposure and increased competitiveness. Corporate India, over the last decade, has aggressively restructured itself, making management more professional, and increasing efficiencies. In a long list of sectors, including telecom, auto and autoparts manufacturing, pharma, and commodities like steel and aluminum, Indian companies are globally competitive. At the same time, they still lack the expertise needed in overseas marketing and distribution.

To fill this gap they are pursuing deals in the U.S., Europe, and Asia.

Given some of India's built-in advantages - such as its enormous output of skilled engineers - its global reach can only grow.

Nevertheless, the need is for Indian companies to go global.

Acquisitions represent a short cut specially for acquiring access to markets, clients, know how, brands, and marketing expertise. However to put all this in perspective Indian acquisitions abroad are still very nascent, and have a long way to go before it can reach the level that Chinese companies already have with Chinese acquisitions involving buyouts running into billions of dollars.

However the Chinese global acquisitions have had the huge backing of the Chinese government whereas the Indian acquisitions are purely independent of any state support.

Given the highly competitive Chinese domestic market Chinese companies are regarding acquisitions abroad as a means of growth.

Many of the companies which are venturing abroad have been finding the going in the Chinese domestic market difficult.

For example, Haier has bid for the Maytag and Hoover brands because its own brands failed to

The jury is still out on the possible benefits of global acquisitions as they tend to be expensive and often do not live up to expectations. At times, acquisitions can even cause the acquiring firm to go down under breakthrough in the American market. This is in sharp contrast to the Indian case where companies which are investing abroad are doing extraordinarily well and appear to be flush with funds.

Further in the case of Chinese acquisitions many of them have failed to live up to their expected track record: for example the acquisition of IBM PCs by Lenovo may find the going tough given that the PCs are already largely produced in low cost locations and relocation to main land China will not reduce costs substantially. In such a scenario Lenovo may find its work cut out in trying to find that extra leverage.

What are the benefits of such

acquisitions? The jury is still out on this in many countries as typically acquisitions tend to be expensive and often do not live up to expectations and at times can even cause the acquiring firm to go under.

For example, the purchase by D'Long, a Chinese conglomerate, of troubled foreign brands, such as Murray lawnmowers and parts of bankrupt aircraft-maker Fairchild Dornier, resulted in it collapsing under its own debts last year.

Similarly TCL, the Chinese television manufacturer is struggling to turn around the loss-making TV operations it bought from Thomson.

Whether an acquisition works or not depends on a complex range of factors many of which are impossible to predict in advance including market conditions and fundamental problems with the acquired company, etc. There also remains the point that most companies are put up on the selling block when there is a problem and not when they are doing well. Turning around a loss making proposition may not necessarily be something which is guaranteed.

Ultimately there is also the very real issue of whether the resources going out in the acquisition of foreign assets could not have been better deployed in the Indian economy. When a company invests abroad, it is the sole beneficiary of such investments via a positive bottom-line.

But this ignores the multiplier effects of investment in the domestic economy via increased employment, income and expenditure generated by the investment. This multiplier effect is currently being exported outside. This is not to say that we should go back to the preliberalization dark ages but that the government needs to seriously consider why domestic investment opportunities are not striking these companies as being equally profitable.

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MARKET PRICE

MARKETING BUSINESS EDUCATION IN INDIA E

ducation institution in devel- uct" from different institutes vastly oping countries have faced different from each other. Even more demand than they though standardization of courses could cope with. For a specialized according to some prescribed field like management where norms may be attained, it is diffiattractive market potencult to 'standardize' inditials have increasingly vidual performance i.e. caused more and more the faculty resource perinstitutions to be set up, son. That perhaps, is not competitive situation is even a desirable goal in slowly changing. Even education, but maintethe institutions facing nance of a certain quality heavy demand have been standard across 'perconfronted with the quesformers' certainly is. In tion of being able to the absence of acceptDr. Deepankar choose the desired ed quality standardizakind of target custion mechanism in this Mukherjee tomers and are, context, it is the marProfessor - Marketing therefore, faced with ket forces alone which issues like product differentiation would force quality standards on and service integration. Education education. is geared primarily to the consumer Characteristic of educational sermarket. There is a category of cus- vices necessitates careful personal tomers for whom education and the selection and planning, constant pursuit of knowledge are expres- and careful monitoring of stansive motives. Education standard- dards which can provide cues to ization opens up the marketing the prospective customer to aid opportunity of creating highly dif- choice of institutions. Examples of ferentiated need based course these cues could be success rate of packages. the placement programme, the The standards of services, educa- absorption of the institutions prodtional services included, would uct in the job market, or the perfordepend upon who provides the ser- mance of the pass outs at other vice and how. This heterogeneity of competitive examinations. performance renders service offers In the context of education, the for the same basic "service prod- customer only buys access to eduThe

24 Edge

cation or derives the learning benefit from the services provided.

There is no transfer of the ownership of the tangibles and intangibles which have gone into the creation of service product. Payment of fees (price for the service) is just the consideration for access to the knowledge for the use of the facilities for the given tenure.

Marketing Strategy and Education Some directions for marketing strategy for education can, however, be drawn keeping in mind the special characteristic of education as intangible dominant, people based, and high contract consumer service. These are outlined below: The dominantly intangible nature of education service may make the consumer's choice of competitive offers more difficult.

In case of delivery systems where the performance of the service demands the presence of the instructor, marketing of education would need to be localized and offer the consumer a more restricted choice.

Perishability may prevent storage of the service product and risk and uncertainty to the marketing of education.

The basic questions for strategic marketing planning that need to be answered are:

What business are we in? In the nature of the benefits sought by number of alternative positioning order to properly define the mis- its 'customers'. Are they merely choices are possible for educational sion and the over all objective of the seeking a certification, or develop- institutions, the task of positioning organization it is essential to define ment of a specific kind of expertise is slightly more difficult proposition what business you are in. Are we in or is accumulation of knowledge here because of the absence of a the business of transmission and the real value sought? Since the strong service differentiation which propagation of knowledge? Are we purchaser of the educational ser- can generate a clearly focused in the business of creating new vice is primarily buying the exper- organizational and product image knowledge? Are we in the business tise or knowledge he believes that in the consumers mind. of developing professional skills? the institution has it at its disposal, How should we offer new serAre we in the business of develop- it is important for the institution to vice offers that help/strengthen the ing special skills preparing people be able to define the kind of exper- competitive position? As needs and for a specific vocation? Or are we tise it is capable of producing. It is want of the customer population there to prochange, existing vide basic Every organization has to consider an entry strategy course packages knowledge and into a market and then plan the protection of a com- or delivery systraining to peotems may cease petitive position. Positioning becomes difficult due to satisfy them. ple which will enable them to The preemptive to the absence of a strong service differentiation reach a level approach to eduwhere they can make further choic- also important to develop an cation planning suggests that satises? Answers to these questions will understanding of the criteria fiers to such needs be preemptively lead the institutions to identify which prospective students apply developed and offered the need what it hold to itself as the organi- when they choose between compet- really becomes apparent to the cuszation mission and overall objec- ing institutions. tomers themselves. Since educative.

Identification of criteria used to tion, to an extent, represents a Who are our customers and differentiate between competing derives demand dependent upon what benefits do they seek? offers may lead institutions to lay the final demand for desired qualiIdentification of target customers emphasis between their offers and fications from employment, changand understanding the needs of the competitor's offer. ing job scenarios, industry requirecustomers, as well as the criteria How can we build or defend our ments and consequent need for they use to make choices, repre- competitive position? Every orga- qualifications may be one indicator sents an important step in market- nization has to consider an entry to watch for generation of new sering strategy formulation. For an strategy into a market and then vice offer ideas. Though a highly educational institution, the task plan as the creation and protection structured approach to research translates to determining what is of a competitive position. Though a and development in a new service The

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may be difficult, there is no reason why systematic organizational processes for generating and testing new course package concepts and weeding out any "unprofitable" service offers should not be designed.

Promotion & Education Services Offer The objective of promotion in education services would be akin to its role I other marketing endeavors. Accordingly, the basic objectives that promotion as a marketing tool is expected to play for marketing of education would include: Building education of the education offer package and the organization providing it.

Creating and sustaining differentiation of the organization and its offer from its competitors.

Communicate and portray the benefits sought to be provided.

Build and maintain the overall image and reputation of the service organization.

Persuade customers to use or buy the service.

Generating detailed information about core, facilitating and augmented service offer.

Advising existing and potential customers of any special offers or modifications or new service offer packages.

Eliminating perceived misconceptions.

Educational institutions have not been able to use promotional tools effectively because of certain perceived or notional barriers. Some of these are: Most educational institutions are product oriented rather than market or student oriented. They perceive themselves as producers of certain educational programmes rather than satisfiers of certain learning needs. This lack of marketing orientation keeps those managing educational institutions from realizing and exploiting the role that promotion could play in The

26 Edge

attaining their organizational objectives.

Professional and ethical consideration prevents the use of certain forms of promotion. Established educational institutions may regard the use of mass advertising and sales promotion as being in bad taste.

The nature of competition in the case of educational institutions like universities, technology and management institutions are such that they are unable to cope with their present demand and work load.

They, therefore, may not feel the

indicators of quality like the provider's reputation or image.

They also tend to rely far more heavily on word of mouth referrals rather than published literature or material supplied by the institutions.

Some guidelines that can be used while applying this powerful tool for generating awareness, interest and enrollment are summarized as follows: Create clear, simple messages: the real challenges in advertising educational services lies in communicating the range, depth, quality

need to promote the demand generation purpose. What has to be realized, however, is that even such institutions need to use promotion for image creating and sustenance as well as to maintain a secure market position.

The nature of consumer attitudes regarding education and their perception of mass media information sources may sometimes preclude the use of intensive promotion. For making their choices regarding a particular institution or a course package, prospective students rely mostly on subjective impressions of the institutions or use surrogate

and level of the service offers provided by a given institution, in simple, unambiguous form. The need of giving pertinent information has to be balanced against the need to avoid wordy copy.

Emphasize service benefits: Based on an identification of benefits sought, advertising for the educational product should emphasize the benefits to be promoted rather than the technical details of the offer.

Make realistic, attainable promises: Education, by its very nature is a high reliability service where expectations are high.

Unfulfilled promises create dissonance which may turn out to be a cost to the organization. Promises in terms of performance of services therefore should be realistic.

Build on world of mouth communications and referrals: As noted earlier, non marketer dominated sources in case of education marketing may be more important to the consumer. Educational organizations should, therefore, build upon the importance of consumers to share their sense of satisfaction with others, directing ad campaigns at opinion leaders and

ities, international orientation, tradition of quality, range and depth of specialization offered, progressiveness, delivery systems, flexibility, supporting services or a combination of any of the above.

Place Decisions & Education Service Depending on the competitive situation, the factors that have marketing implications in terms of location are: What does the market demand?

Will the purchase of service be postponed or negated if the institution is not conveniently located? How critical are accessibility and conve-

encouraging potential customers to talk to existing consumers.

Provide tangible clues: In terms of certification, records of attainment and past success figures provide the prospective target population with tangible clues to enable them to make choice decisions.

Develop continuity in advertising: Most successful institutions position themselves in different ways so that their images are discernibly different in the eyes of the consumer population. Positions could be built around innovative teaching methods, faculty expertise, research and development possibil-

nience in service choice decisions?

Are competitors finding alternative ways to reach out to the markets (distance learning in education)? Can some competitive advantage be gained by developing alternative/different norms of service location and delivery?

How does flexibility, being technology or people based, affect the educational service offer in terms of flexibility in location and relocation?

Is there an obligation on the part of the institution to be located in an convenient site (i.e. public heath education centers, family

planning training centers, vocational training centers etc.)

How critical are complementary services to the location decision (transport, residential and canteen facilities and so on)?

Answers to issues like the above underline the critical importance of the location decision and ay result in more systematic approaches than in past.

Summary In the present ear, it is not natural resources or natural wealth which distinguishes an affluent society from a backward one — it is the accumulation and development of knowledge resources. Education was never as important a utility as it is today.

People, however, differ in the benefits they seek from the educational services provide to them. It is important, then, in order to be able to satisfy these needs and wants effectively, that a marketing orientation be applied to the conceptualization, design and delivery of the educational service.

This is even more imperative in a developing country like India where resources are scarce and a better match between needs and services provided is to be attained.

Education planners' in order to plan the service offer well and deliver it effectively need to understand the behaviour of the target population and the criteria they use to exercise choice. They key to better delivery of the education service is not that it is performed by people buy that it is performed for people.

People, therefore, represent the starting point for analysis to precede conceptualizating the service offer and developing it into a marketable service package.

The education service offered by the institution must reflect the organization's response to the identified needs and wants of the target segment in a given socio-economic context.

The

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ACCOUNTING TOOL

The

IFRS edge I

nternational Financial Reporting Standards (IFRS) are a new set of accounting standards issued by the International Accounting Standards Board (IASB). The IASB replaced the International Accounting Standards Committee in 2001. The IASC has issued a total of 68 exposure drafts, 41 International Accounting Standards (IAS) and Interpretations of IAS between 1973 and 2001.

Subsequently, the IASB made a statement on April 23, 2001 about current and future standards: “IASB publishes new arrangements for its Standards in a series setting global standards. of pronouncements Since then, the IASB has called IFRS. It has also issued several new IFRSs adopted the body of to replace some IASs and Standards issued by the on topics for which there Board of the IASC. These was no IAS as part of its pronouncements continconvergence project. ue to be designated IAS.�

In addition, the IASB The ultimate goal has made improveNavneet Saxena of IASB is the develments and revisions opment and rigorous to some IASs as part Fellow- Finance and Accounting application of a sinof its improvement gle set of global accounting stan- project. Numerous interpretations dards which will produce high and exposure drafts have also been quality transparent and compara- issued. ble information in general purpose It has been considered that comfinancial statements. On May 23, panies listed on any foreign stock 2002, IASB published the Preface exchanges may find reporting their to IFRS which provided a brief financials in IFRSs to be more description of the purpose and advantageous to them than those function of the main structures of companies which do not have any The

28 Edge

listing on any foreign stock exchange.

The term International IFRS has both a narrow and a broad meaning. Narrowly, the IFRS refer to the new numbered series of pronouncements that the IASB is issuing, as distinct from the International Accounting Standards (IASs) series issued by the predecessor. More broadly, IFRS refers to the entire body of IASB pronouncements, including standards and interpretations approved by the IASB and IAS and the SIC interpretations approved by the predecessor International Accounting Standards Committee. IFRS are continually reviewed and updated to take account of changing business environment and new challenges that emerge from time to

time.

Adopting a common financial reporting language is a big step towards improving the efficiency of international capital markets. The adoption of IFRS will reduce the barriers to both trade and the flow of capital. Investors will have access to more reliable financial data to compare and analyse corporate performance in multiple jurisdictions.

Sir David Tweedie, Chairman, IASB, lists out the benefits of IFRS: "The goal is to create one single set of accounting standards that can be applied anywhere in the world, saving millions for firms with more than one listing and allowing investors to compare the performance of businesses across geographic boundaries for the first time."

As issuers of securities, companies will be able to access investors more easily, potentially reduce their cost of capital, and save the costs of conforming to different requirements in different jurisdictions.

Audit firms will be better able to assure quality of audits among national partner firms. Regulators will benefit from the greater consistency and quality of information.

On a macro economic level, the gains to be derived from such a market are considerable. Also on a lower level, the move to IFRS is beneficial. It presents company executives with opportunities to challenge the way in which their company is viewed and evaluated by investors, other key stakeholders, and competitors.

Conversion to IFRS allows companies to: Re-shape internal management reporting systems to effectively manage financial statement generation within the new regime, and to provide essential management information required internally.

Improve the metrics that evaluate company and executive perfor-

Conversion to IFRS will require significant alterations to financial accounting and reporting processes and systems. The challenge is to complete the conversion effectively with sufficient time to train people mance, particularly in terms of increasing shareholder value Enhance the communication of the company's financial results and position-together with other performance indicators- to analysts, investors, and other key stakeholders Benchmark the company against its global peer group, gaining a broader and deeper understanding of the company's relative standing by looking beyond the country and regional benchmarks Reduce its cost of capital Conversion to IFRS will require significant alterations to financial accounting and reporting processes and systems. The challenge is to complete the conversion efficiently and effectively, with sufficient time to test systems, train people, and deal with change-management issues before the system must go 'live'. The steps are conducting an initial diagnostic analysis; designing and planning the IFRS conversion process; identifying key issues; developing and implementing solutions; addition, training to company personnel and review of the company's IFRS financial statements.

In India, accounting and legal systems have been developed on the British pattern. However, the Companies Act and other related statutes to Industry and Commerce were amended many times to meet changing requirements. At present, after the deregulation of the economy in 1991, it is trying to bring its accounting standards closer to the IFRSs, subject to applicable local laws, customs and business norms.

The increase in FDI in India has necessitated the use of internationally-accepted accounting practices and led to a rapid adaptation of the IFRSs. In India, the regulatory framework governing corporate disclosure includes the Companies Act 1956 and Securities Exchange Board of India 1992. The annual accounts are prepared according to section 211 and schedule VI of the Companies Act. At present, Indian accounting standards are of good quality in most instances, in fact are practically the same as IAS. A switch to IAS would be a more in form than substance.

Anyhow, adopting IAS will be of tremendous help in attracting foreign capital and, thereby, lowering cost of capital to Indian companies.

It is suggested that the cost of capital is lowered for firms that adopt international accounting standards. A number of leading companies, like Infosys and Bharati Tele Ventures, have voluntarily adopted IAS or US GAAP. The comparison of Indian Accounting

The

Edge 29

Standards with IAS reveals that the cost of capital, and increasing the Europe and the United States. Such Indian standards require more dis- opportunity for investment, employ- failures are causing regulators, closure than International ment and world growth. The poten- governments and stakeholders.

Standards in cases of accounting tial benefits of an integrated global This will have serious impact on for leases, earnings per share; con- capital market regulated by a single corporates worldwide. In order to solidated financial statements; worldwide financial reporting lan- prevent such repetitions, there has accounting for investments in asso- guage will be long lasting. been an overhaul of accounting and ciates; financial reporting of interReporting corporate performance auditing standards.

General ests in joint ventures etc. in a way that complies with all the Agreement on Trade in Services Prior to 1991, the global flow of complex corporate reporting regula- and World Trade Organisation have information, technology, capital, tions and laws of each country in mandated to achieve greater goods, services and people has never which you operate has never been degree of liberalization in all serbeen greater. Since the late 1990s, easy. And now, new regulations and vice sectors. Powerful new techunprecedented growth is being wit- standards such as IFRS have made nologies and communications nessed in the developing world. the task even more challenging. devices have opened the world for Think globally, act locally is Meeting these new reporting stan- an explosion in cross-border comimperative for survival and growth. dards will — at least over the short- merce and capital creation.

In an increasingly competitive glob- term — almost certainly add to your It is clear that the adoption of IFRS al marketplace, the ability to oper- company’s headaches. High quality could have a huge positive impact on ate profitably in diverse geographic corporate reporting is too important the Indian economy by affording markets, and shift operations flexi- to be determined solely by the shape more Indian companies access to forbly between countries may be of externally imposed regulation. eign capital and lowering the cost of essential to the succapital generally. cess of any business. It India should redefine Adoption of IFRS could have a huge positive also creates vast its objectives by makopportunities for ing radical structural impact on the Indian economy by affording Indian management reforms in the democmore Indian companies access to foreign professionals all over ratic economy. the world. But operatInvestors also want capital and lowering the cost of capital ing globally generates companies to report on generally. India should redefine its aims a wide variety of praca broad set of nontical, legal, and HR financial measures, and finance issues.

To stake its own claim to report- which combined with financial Multinational firms must comply ing excellence and public trust — reporting might provide a better with host countries' laws on tax, your company must foster a culture basis for judging corporate perforpensions, business practices and that views reporting transparency mance.

The International human resources. One country's as a worthy end in itself, indepen- Accounting Standards Board and entrepreneur may be another's dent of rules and regulations. In Financial Accounting Standards antitrust violator. Hence, continu- recent times there has been a para- Board have agreed to collaborate. ous improving performance has digm shift in many economies in In the context of the emerging globbecome a persistent need for com- the way that corporate governance, al economy such convergence is panies. The country's low-cost, business ethics and compliance are imperative. Therefore a desire for a high-quality human resources approached. It is a shift that contin- new single set of accounting stanafford Indian companies a unique ues to be driven by demanding per- dards has been expressed frequentcompetitive advantage. But to fully formance expectations, increasing ly worldwide as Globally Accepted leverage this advantage, they need stakeholder demands and growing Accounting Principles. to attract more foreign capital from public scrutiny after some spectacIFRS should get sufficient particiglobal financial markets. ular failures around the globe. pation from industries, accounting The move towards a single set of Potentially, this is a highly positive academics, voluntary organisations high quality global accounting stan- development. of academics, environmentalists, dards which transform the landMuch has been heard about the ecologists and humanists. And the scape of accounting is a change that financial scandals and corporate ICAI should carefully consider the has important practical implications: frauds that have shaken the finan- suitability of the IFRSs in Indian building confidence, lowering the cial world in the past especially in context further.

The

30 Edge

HITECH OUTING

T

he world is discovering that India is a superpower in developing IT solutions.

Swept by the current trend of IT outsourcing to India, many Fortune 500 companies like Microsoft, Oracle, Citibank, Morgan Stanley, Wal-Mart, AT&T, General Electric, Reebok, General Motors, Sony, Coca-cola, Pepsi, Swissair, Philips & IBM are the beneficiaries of it.

International Data Corporation estimates that, in the near future, three-quarters of the world's call centre services will be provided from India.

India's language, educational system and training programs have helped transform the country into an outsourcing superpower. It is a fact that in the West, call centres depend on poorly educated labour force.

India being the world’s second highly populated country, human resources are a boon by itself. Just as the Gulf is renowned for its natural resource of crude oil, and South Africa for its diamonds, India is proud of the abundance and availability of its highly qualified and technically cially among graduates. skilled English speaking This makes India the computer professionals; preferred destination who are key to success in for outsourcing of serthe field of IT outsourcing vices. Western compato India. nies are moving their Despite its status as a telephonic customer developing country, India support functions to already has an excellent Indian facilities not only educational system; for cost-saving, but P Sunil Kumar young people in India the service quality is take their education often improved, too.

Personal Assistant, Chairman's Office very seriously, many of China and India them to have multiple degrees in have the same level of talent, but engineering, computer science and India has become a bigger outsourcbusiness.

India's work force is ing centre because there are no known internationally for its entre- communication barriers. preneurial spirit and a burning Information and notes can be desire to succeed. exchanged in English. But India has India has one particular advan- major infra-structural deficiencies tage over its major competitor, — power cuts, poor roads, shoddy China — fluency in English, espe- airports — but there are major pro-

India

Calling jects already under way to address some of those.

Excellent telecom, ISP and cellular networks are available in all cities & towns in the country which helps the country to look at business with West. India prides in the reliable satellite and submarine communication links that facilitate good band connectivity with the rest of the world. Thus, companies engaged in IT outsourcing to India, can be in touch with the vendors without any connection hurdles. This plays a significant role in determining the success of IT outsourcing to India.

IT is regarded as one of the top 5 priority industries in India. IT is part of the national agenda and policies are framed so as to obtain maximum benefit out of IT outsourcing to India.

The

Edge 31

CORPORATE EXPANSION

GLOBAL INDIAN COMPANIES

usiness week, the celebrated business magazine had run a major story about top 100 companies from rapidly developing economies on May 30, 2006. These countries comprise Brazil, China, Czech Republic, Hungary, India, Indonesia, Malaysia, Mexico, Poland, Russia, Thailand, and Turkey.

This list has been prepared by Boston consulting Group (BCG), the major consulting firm, on parameters like the size of the firm, unique globalization capabilities or business models like major international investments, manufacturing facilities, sales networks, research and development centers, its access to capital for financing international expansion, the breadth and depth of its technologies and its intellectual property portfolio.

These companies are “The New Global Challengers", as the report says. BCG names these 100 companies from Rapidly Developing Economies (RDEs) that are poised to become important 21st century multinationals. They will radically transform industries and markets around the world.

This list includes 21 Indian companies, which have rapidly globalized their operations on many parameters. Apart from these 21, eight companies doing strong domestic business with focus on either fighting foreign competition in Indian market or making their presence felt in foreign market are also on the list. We look at their strong points:

B

BAJAJ AUTO Bajaj Auto started importing two and threewheelers in 1948. It started manufacturing in 1960 and in the next 30 years, it reached the figure of 1 million two wheelers and threewheelers annually. The rise of Bajaj Auto coincides with the rise of modern independent India.

Bajaj Auto is the world's fourth largest twothree-wheeler manufacturer and the brand is The

32 Edge

STUDY PAPER

By Rahul Mishra Assistant Professor- Marketing

known in over a dozen countries in Europe, Latin America, the US and Asia.

Chairman Rahul Bajaj took charge of the Co. in 1965. Under his leadership, the turnover of the flagship Bajaj Auto went up

from Rs. 72 million to Rs. 46.16 billion.

Bajaj Auto continues to be India's largest exporter of two-three-wheelers. During 200506, it exported 250,204 two and three-wheelers which represented a growth of 27 per cent over 2004-05. Exports now constitute 11 per cent in volume terms and 12 per cent of its value of net sales.

Bajaj Auto has developed distribution network in 50 countries, with dominance in Sri Lanka , Columbia , Bangladesh , Mexico , Central America , Peru and Egypt.

BHARAT FORGE Bharat Forge Ltd., flagship company of the US $ 1.5 billion Kalyani Group, is a 'Full Service Supplier' of engine & chassis components. It is the largest exporter of auto com-

ponents from India and the leading chassis component manufacturer in the world. It is the second largest forging company globally.

With manufacturing facilities spread over 9 locations and 6 countries — two in India, three in Germany, one in Sweden, one in Scotland, one in North America and one in China — the company manufactures a wide range of safety and critical components for passenger cars, commercial vehicles and diesel engines.

Bharat Forge has built a strong capability in design and engineering, including a full fledged product testing and validation facility, which gives it a Full Service Supply Capability - from product conceptualization, designing, manufacturing to product testing & validation.

Group Chairman’s Baba Kalyani vision is for the company to become the No.1 forging company in the world by 2008. As No. 2 now, it will be not be a distant goal.

The company rests on state-of-art, global scale facilities, Global Dual Shore Manufacturing Capability, World Class Technology, Full Service Supply Capability, largest single location capacity worldwide, wide product profile across auto & non-auto segments, and best 'Speed to Market' in the Industry.

CIPLA Dr K A Hamied set up "The Chemical, Industrial and Pharmaceutical Laboratories Ltd (CIPLA)" in 1935. The major boost to CIPLA came after independence. In 1952, CIPLA set up its first research division for attaining self-sufficiency in technological development. It started manufacturing Ampiciline in 1968. In the next 15 years, it developed anti-cancer drugs, vinblastine and vincristine in collaboration with the National Chemical Laboratory, Pune, and won the Sir P C Ray Award for developing technology for indigenous manufacture of basic drugs.

In 1994, CIPLA launched Nevirapine, antiretroviral drug, used to prevent the transmission of AIDS from mother to child. There are seven manufacturing centers approved by FDA, USA, Medicines and Healthcare products Regulatory Agency (MHRA), UK, Therapeutic Goods Administration (TGA), Australia, Medicines Control Council (MCC), South Africa National Institute of Pharmacy (NIP), Hungary, Pharamaceutical Inspection Convention (PIC), Germany World Health Organisation (WHO), Department of Health, Canada, State Institute for Control of Drugs, Slovak Republic and ANVISA, Brazil .

CIPLA's products are sold across 160 countries. The exports for financial year ended March 31, 2006 were more than Rs. 15,000 million. Cipla exports raw materials, intermediates, prescription drugs, OTC products and veterinary products. Technical know-how/fees received during the year 2005-06 amounted to Rs. 4156 million.

CROMPTON GREAVES A pioneering leader since 1937 in the management and application of electrical energy, Crompton Greaves, today, is India's largest private sector enterprise, extensively engaged in designing, manufacturing and marketing high technology electrical products and services related to power generation, transmission, distribution and executing turnkey projects. The company is emerging as a first choice global supplier for high quality electrical equipments. The fans and lighting businesses acquired "Superbrand" status in January 2004, a unique recognition among the country's 134 selected brands.

Crompton Greaves goes back to 1878 when Col. R.E.B. Crompton founded R.E.B.Crompton & Company. In 1947, it was taken over by Lala Karamchand Thapar.

Crompton Greaves acquired Belgium-based Pauwels in May, 2005. The company has manufacturing facilities in Belgium, Ireland, Canada, USA and Indonesia and a distribution network across the globe. The acquisition catapults the company amongst top 10 transformer manufacturers in the world.

Crompton Greaves products have been exported to over 60 countries including USA, UK, European Union, Australia and New Zealand. Crompton Greaves is the leading exporter of power transformers and fans and

aggressively pursues export opportunities for all its product categories. The company's advantages of low production cost and high engineering quality makes its products an attractive choice and the company is increasingly considered as an ideal source for a range of products. The exports have shown impressive growth rate, with exports reaching up to level of Rs.500 crore.

DR. REDDY'S LABORATORIES Dr. Reddy's Laboratories was founded by Dr Anji Reddy, entrepreneur-scientist, in 1984.

The DNA of the company is drawn from its founder and his vision to establish India's first discovery led global pharmaceutical company.

Dr Anji Reddy started Dr. Reddy's Laboratories with $40,000 cash and $120,000 in bank loan. Today, the company with revenues of Rs.1947 crore (US $446 million), and it is India's second largest pharma-

ceutical company.

The company manufactures and markets API (Bulk Actives), Finished Dosages and Biologics in over 100 countries worldwide, in addition to having a promising Drug Discovery Pipeline. Dr. Reddy's started its first big move in 1986 from manufacturing and marketing bulk actives to the domestic (Indian) market to manufacturing and exporting to highly regulated overseas markets, leveraging on its 'Low Cost, High Intellect' advantage.

With over 950 scientists working across the globe, round the clock, the company continues its relentless march to deliver breakthrough medicine and address an unmet medical need and make a difference to people's lives worldwide.

HINDALCO INDUSTRIES Hindalco industries part of Aditya Birla Group, is the fourth largest Aluminium Company in Asia. It also remains the largest producer of Aluminium in India. Hindalco remains one of the lowest cost producers of Aluminium in the world. The company's quality has been ISO 9001:2000 and 14001 certified with Alumina refining capacity of 1,160,000 tpa and Aluminium metal producing capacity of 439,000 tpa.

Hindalco has also got India's largest copper smelting and refining plant at Dahej, Gujarat, with two copper mines in Australia. It has got smelting and refining capacity 500,000 tpa, the largest single location smelter in the world.

Hindalco has set the Vision of the company as to be a premium metals major, global in size and reach, with a passion for excellence.

INFOSYS TECHNOLOGIES Infosys Technologies Ltd. provides consulting and IT services to clients globally — as partners to conceptualize technology-driven business transformation initiatives. With over 58,000 employees worldwide, Infosys uses a low-risk Global Delivery Model to accelerate schedules with high degree of time and cost predictability.

The company provides end-to-end business solutions that leverage technology. It works with global corporations and new generation technology companies to build new products or services and to implement prudent business and technology strategies in today's dynamic digital environment.

Infosys has long overgrown its roots and become a $ 2 billion company in revenues.

Infosys has made its operations in many ways. The sources of finance and revenue sources of employees and also global ocation for its development centers — Global development centers in USA, Canada, UK, and Japan, expand the capabilities of Infosys' global delivery model to leverage talent and infrastructure in different parts of the world.

LARSEN & TOUBRO (L&T) Larsen & Toubro Limited (L&T) is a technology-driven engineering and construction organization and one of the largest companies in India's private sector. It has additional The

Edge 33

interests in manufacturing, services and Information Technology.

L&T has a global spread of offices. A thrust on international business over the last few years has seen overseas earnings growing to 18 per cent of the total revenue.

The company was founded in Mumbai in 1938 by Danish engineers Henning HolckLarsen and Soren Kristian Toubro, both committed to developing India's engineering talent. Beginning with the import of machinery from Europe, L&T rapidly took on engineering and construction assignments of increasing sophistication. Today, the company sets engineering benchmarks.

L&T has executed comprehensive construction projects in the areas of fertilizer and petrochemicals, airports, townships, hotels, public buildings, bridges, transmission lines, water treatment plants, hydro-electric power stations and irrigation structures in the Middle East, South East Asia, Russia, CIS, Mauritius, African and SAARC countries.

MAHINDRA & MAHINDRA LIMITED Mahindra & Mahindra Limited is the flagship company of the US $ 2.59 billion Mahindra Group which has a significant presence in key sectors of the Indian economy. A high performer, M&M is one of the most respected companies in the country.

Set up in 1945 to make general-purpose utility vehicles for the Indian market, M&M soon branched out into manufacturing agricultural tractors and light commercial vehicles (LCVs). The company expanded its operations from automobiles and tractors to secure a significant presence in many more important sectors. Over the years, it has transformed itself into a Group that caters to the Indian and overseas markets with a presence in vehicles, farm equipment, information technology, trade and finance related services and infrastructure development.

Its Automotive Division manufactures utility vehicles, light commercial vehicles and three wheelers. The Company has recently entered into a JV with Renault of France for the manufacture of a mid-sized sedan, the Logan, and with International Truck & Engine Corporation, USA, for manufacture of trucks and buses in India.

The Tractor (Farm Equipment) Division makes agricultural tractors and implements The

34 Edge

that are used in conjunction with tractors, and has also ventured into manufacturing of industrial engines. The Tractor Division has won the coveted Deming Application Prize 2003, making it the only tractor manufacturing company in the world to get this prize.

M&M employs 11,600 people and has eight manufacturing facilities.

ONGC The ONGC completed 50 years of successful operations on 14th August 2006. It is a tower of strength in the national economy and a force to reckon with in the global petroleum industry.

It has discovered six out of the seven producing basins in India and established more than 6 billion tonnes of in-place hydrocarbon

reserves in domestic basins with 330 oil and gas discoveries. It is contributing more than 80% of crude oil and natural gas production in India.

ONGC has become transnational company of India having presence in 14 countries with 24 projects and committed overseas investment of over USD 5 billion.

The fiscal year 2005-06 was yet another landmark year. A few indicators will give an outline of its strength: Profit after Tax (PAT): Rs. 14,431 Crore, Net Worth: Rs. 53,593 crore.

With a market capitalization having exceeded Rs 1 trillion, ONGC retains it's position as the most valuable company in India in various listings.

RANBAXY The Indian pharmaceutical industry is at the centrestage in global healthcare and Ranbaxy

endeavours to be at the forefront in delivering Indiacentric advantages to advanced and developing countries.

From a small domestic company at inception, Ranbaxy has grown formidably to be a billion dollar institution that was envisioned

by Late Dr Parvinder Singh, Chairman and Managing Director, Ranbaxy in early 90's.

Ranbaxy Laboratories Limited, India's largest pharmaceutical company, headquartered in India, is an integrated, research based, international pharmaceutical company, producing a wide range of quality, affordable generic medicines, trusted by healthcare professionals and patients across geographies. It is ranked amongst the top ten generic companies worldwide. The Company has manufacturing operations in 8 countries with a ground presence in 49 countries and its products are available in over 125 countries.

Ranbaxy has an expanding international portfolio of affiliates, joint ventures and representative offices across the globe with a presence in 23 of the Top 25 pharma markets of the world. Additionally the Company has a presence in 21 of the 25 EU countries.

Ranbaxy has robust operations in USA, UK, France, Germany, Russia, India, Brazil and South Africa, and is strengthening its business in Japan, Italy, Spain and several other markets in the Asia Pacific.

Ranbaxy views its R&D capabilities as a vital component of its business strategy that will provide the company with a sustainable, long-term competitive advantage.

The company today has a pool of 1,100 scientists who are engaged in path-breaking research.

The Company's vision is to achieve significant business in proprietary prescription products by 2012 with a strong presence in developed markets. It also aspires to be amongst the Top 5 generic players with US $5 Bn in sales, by 2012.

Ranbaxy has world-class manufacturing facilities in China, Ireland, India, Malaysia, Nigeria, USA and Vietnam. Some agencies such as MCA-UK, MCC-South Africa, FDAUSA, TGA-Australia and WHO have audited and approved Ranbaxy's manufacturing facilities for the compliance with international Good Manufacturing Practices and have registered its products for safety, quality and efficacy.

RELIANCE PETROCHEMICALS Reliance Industries Limited operates worldclass manufacturing facilities at Naroda, Patalganga, Hazira and Jamnagar, all in western India.

The Naroda facility near Ahmedabad, houses a textile plant on a 150 acre site. The Patalganga complex, near Mumbai, has polyester, fibre intermediates and linear alkyl benzene manufacturing plants and is spread over 200 acres of land. The Hazira complex, near Surat, has a naphtha cracker feeding downstream fibre intermediates, plastics and polyester plants and is spread over 700 acres of land. The Jamnagar complex has a petroleum refinery and associated petrochemical plants making plastics and fibre intermediates. It is spread over 7,400 acres of land.

Reliance's Jamnagar complex represents the largest industrial project ever implemented by the Indian corporate sector. It is the world's largest green field petroleum refinerycum-petrochemicals complex. A captive port terminal has the capacity to handle 50 million tones per year of liquid products.

SATYAM COMPUTER Satyam Computers is a leading global consulting and IT services company, offering an array of solutions customized for a range of key verticals and horizontals.

Satyam's network spans 55 countries, across 6 continents. Nearly 30,000 dedicated and highly skilled IT professionals, work in development centers in India, the USA, the UK, the UAE, Canada, Hungary, Singapore, Malaysia, China, Japan and Australia and serve over 489 global companies, including over 156 Fortune 500 corporations.

WIPRO Wipro Technologies is a global services provider delivering technology-driven business solutions that meet the strategic objectives of our clients. Wipro has 40+ 'Centers of Excellence' that create solutions around specific needs of industries. Wipro delivers unmatched business value to customers through a combination of process excellence, quality frameworks and service delivery innovation. Wipro is the World's first CMMi Level 5 certified software services company and the first outside USA to receive the IEEE Software Process Award.

WIPRO has 490 clients and 53,000 employees with footprints in all continents. To ensure the customer proximity, the company has deployed 5000 consultants in USA, Japan and Europe. At the end of March 2006, Wipro's revenue stood out from all combined IT businesses as $2 billion.

over 300 cities in India and a comprehensive portfolio of managed services that makes VSNL the most reliable provider of solutions to, from and within India.

VSNL International is a 100% subsidiary of VSNL comprising of over 17 legal entities, and has registered headquarters in Singapore.

VIDESH SANCHAR NIGAM LIMITED On April 1, 1986, Videsh Sanchar Nigam Limited, a wholly Government-owned corporation, was born. It introduced Internet services in India in 1995. The new era of communications started towards the new millennium.

In February 2002, the Government, as per its disinvestments plan, released 26% of VSNL's equity to a strategic partner.

VIDEOCON The Videocon group emerges as a USD 2.5 billion global conglomerate continuing to set trends in every sphere of its activities from a conference room sized assembly line in 1979.

The Videocon group has four business areas: 1. Consumer Electronics, Home Appliances & Compressor manufacturing where Videocon enjoys a pre-eminent position in terms of sales and customer satisfaction in many of consumer products like Televisions, Washing Machines, Air Conditioners, Refrigerators, Microwave ovens and many other home appliances.

2. Display industry and its components With the Thomson acquisition Videocon has emerged as one of the largest Colour Picture tube manufacturers in the world operating in Mexico, Italy, Poland and China, continuing to lead through new innovative technologies.

3. Colour Picture Tube Glass Videocon is one of the largest CPT Glass manufacturers in the world with a high level of experience and technical expertise operating through Poland and India.

4. Oil and Gas An important asset for the group is its Ravva oil field with one of the lowest operating costs in the world producing 50,000 barrels of oil per day.

Consequently, VSNL went under the administrative control of TATAs, India's best known industrial house.

The company's ADRs are listed on the New York Stock Exchange and its shares are listed on major Stock Exchanges in India.

VSNL with its dedicated work force of about 2000 employees is committed to providing efficient and cost effective world class telecommunications services.

VSNL business portfolio ranges from national long distance to international long distance to broadcast by providing uplinking facilities to many telecommunications services. The global business arm of VSNL is VSNL Internationl.

VSNL International's Global Network spans across four continents and comprises major ownership in 206,356 km of terrestrial network fiber and subsea cable. This, coupled with a powerful domestic network that covers

TVS MOTORS TVS Motor Company Limited, the flagship company of the USD 2.2 billion TVS Group, is the third largest two-wheeler manufacturer in India and among the top ten in the world, with an annual turnover of over $650 million.

In the future, TVS Motor Company will be one among the top two 2-wheeler companies in India and one among the top five 2-wheeler companies in Asia.

TVS has two state-of-the-art manufacturing plants in Mysore and Hosur, near Bangalore, India's IT Capital, are spread over 272 acres and 174 acres respectively, with a combined The

Edge 35

capacity to produce over 1.5 million two wheelers per annum.

TATA TEA Set up in 1964 as a joint venture with UKbased James Finlay and Company to develop value-added tea, the Tata Tea Group of Companies, which includes Tata Tea and the UK-based Tetley Group, today represents the world's second largest global branded tea operation with presence in 40 countries.

The consolidated worldwide branded tea business of the Tata Tea Group contributes to around 86 per cent of its consolidated turnover with the remaining 14 per cent coming from Bulk Tea, Coffee, and Investment Income. The Company is headquartered in Kolkata and owns 27 tea estates in Assam, West Bengal and Kerala.

Tata Tea brand is accorded "Super Brand" recognition in the country.

Tata Tea has subsidiaries in Great Britain, United States and India.

The Tetley Group has been a member of the Tata Group since March 2000 and now contributes around two thirds of the total turnover of Tata Tea Ltd. Headquartered in Great Britain, its footprint is global: Tetley has offices in Australia, Canada, Poland, Russia, South Africa and the US, as well as joint ventures in Pakistan and Bangladesh. Today, Tetley is the second largest tea bag brand in the world, and Tetley products are on sale in over 40 countries.

Tata Tea Inc. in the USA processes and markets Instant Tea from its facility in Florida, based on sourcing of Instant Tea products out of Munnar, Kerala.

Everyday over 64 million cups of Tata Tea teas brightens up the day for its consumers.

TATA STEEL Established in 1907, Tata Steel is Asia's first and India's largest private sector steel company.

Its captive raw material resources and the state-of-the-art 5 MTPA plant at Jamshedpur, in Jharkhand give it a competitive edge.

Determined to be a major global steel player, Tata Steel has recently included in its fold NatSteel, Asia (2 MTPA) and Millennium Steel (1.7 MTPA) creating a manufacturing network in eight markets in South East Asia and Pacific rim countries.

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36 Edge

Tata Steel's products are targeted at the quality conscious auto sector and the burgeoning construction industry. With wire manufacturing facilities in India, Sri Lanka and Thailand, the Company plans to emerge as a major global player in the wire business.

World Steel Dynamics has ranked Tata Steel as the world's best steel maker (for two consecutive years) in its annual listing in February 2006. Tata Steel's turnover has reached to 25,000 crores of rupees.

TATA MOTORS Tata Motors Limited is India's largest automobile company, with revenues of Rs. 24,000 crore (USD 5.5 billion) in 2005-06. It is the leader by far in commercial vehicles in each segment, and the second largest in the pas-

senger vehicles market with winning products in the compact, midsize car and utility vehicle segments. The company is the world's fifth largest medium and heavy commercial vehicle manufacturer. Tata Motors is India's only fully integrated automobile manufacturer with a portfolio that covers trucks, buses, utility vehicles and passenger cars. It would be no exaggeration to say that Tata Motors provides wheels for India's growth.

Tata Motors, the first company from India's engineering sector to be listed in the New York Stock Exchange (September 2004), has also emerged as a global automotive company. In 2005, Tata Motors acquired a 21% stake in Hispano Carrocera, a reputed Spanish bus and coach manufacturer, with an option to acquire the remaining stake as well.

The company's commercial and passenger vehicles are being marketed in Europe, Africa, the Middle East, Australia, South East Asia

and South Asia. It has assembly operations in Malaysia, Kenya, Bangladesh, Spain, Ukraine, Russia and Senegal.

With 1,400 engineers and scientists, the company's Engineering Research Centre, established in 1966, has enabled pioneering technologies and products.

TCS Tata Consultancy Services Limited (TCS) is the world-leading information technology consulting, services, and business process outsourcing organization that envisioned and pioneered the adoption of the flexible global business practices that today enable companies to operate more efficiently and produce more value. TCS has reached to 3 billion dollar of revenue with 71,000 employees with CAGR in last five years coming to 34%.

TCS commenced operations in 1968, when the IT services industry didn't exist as it does today. Now, with a presence in 34 countries across 6 continents, & a comprehensive range of services across diverse industries, we are one of the world's leading Information Technology companies.

Seven of the Fortune Top 10 companies are among our valued customers.

TCS core areas of research are systems & software engineering, process engineering, embedded systems, VLSI, bioinformatics and security. Due to our applied-research outlook, TCS has developed several proprietary tools such as MastercraftTM and AssentTM that allow it to automate the software development process & significantly bring down development costs. The R&D investments helps TCS to enhance & differentiate its services and delivery capabilities.

After the above mentioned companies , there are nine companies which have proved to be strong global and national competiton.

We are doing the broad profile of these companies belowRELIANCE COMMUNICATIONS Reliance Communicatins is the outcome of late Dhirubhai Ambani's dream of bringing about a digital revolution in India that will bring to every Indian's doorstep an affordable means of information and communication.

"Make the tools of infocomm available to people at an affordable cost. They will overcome the handicaps of illiteracy and lack of

mobility", was how Dhirubhai, as he was fondly called, spelt out Reliance Communications mission in late 1999. He firmly believed the country could use information and communication technology to overcome its backwardness and underdevelopment. It was with this belief that Reliance Infocomm began laying its 60,000 route kilometres of pan-India fibre optic backbone in 1999. The backbone was commissioned on December 28, 2002, Dhirubhai's 70th birth anniversary, first since his sad demise on July 6, 2002.

Reliance Infocomm's network is a highcapacity, integrated (wireless and wireline), and convergent (voice, data and video) digital network. The network is designed to offer services that span the entire Infocomm value chain - infrastructure, services, both for enterprises and individuals, applications, and consulting. The network is designed to deliver services and applications that will change the way we Indians live.

Reliance Communications is the flagship company of the Anil Dhirubhai Ambani Group (ADAG) of companies. Listed on the National Stock Exchange and the Bombay Stock Exchange, it is India's leading integrated telecommunication company with over 25 million customers.

It encompasses a complete range of telecom services covering mobile and fixed line telephony. It includes broadband, national and international long distance services and data services along with an exhaustive range of value-added services and applications..

Reliance Mobile (formerly Reliance India Mobile), launched on 28 December 2002, coinciding with the joyous occasion of the late Dhirubhai Ambani's 70th birthday, was among the initial initiatives of Reliance Communications. It marked the auspicious beginning of Dhirubhai's dream of ushering in a digital revolution in India. Reliance communications is part of Anail Dhirubhai Ambani group.

ICICI BANK ICICI Bank is India's second-largest bank with total assets of about Rs. 2,513.89 bn (US$ 56.3 bn) at March 31, 2006 and profit after tax of Rs. 25.40 bn (US$ 569 mn) for the year ended March 31, 2006 (Rs. 20.05 bn (US$ 449 mn) for the year ended March 31,

2005). ICICI Bank has a network of about 614 branches and extension counters and over 2,200 ATMs. ICICI Bank offers a wide range of banking products and financial services to corporate and retail customers through a variety of delivery channels and through its specialised subsidiaries and affiliates in the areas of investment banking, life and non-life insurance, venture capital and asset management.

ICICI Bank set up its international banking group in fiscal 2002 to cater to the cross border needs of clients and leverage on its domestic banking strengths to offer products internationally. ICICI Bank currently has subsidiaries in the United Kingdom, Russia and Canada, branches in Singapore, Bahrain, Hong Kong, Sri Lanka and Dubai International Finance Centre and representative offices in

the United States, United Arab Emirates, China, South Africa and Bangladesh. Our UK subsidiary has established a branch in Belgium. ICICI Bank is the most valuable bank in India in terms of market capitalisation.

ICICI Bank's equity shares are listed in India on the Bombay Stock Exchange and the National Stock Exchange of India Limited and its American Depositary Receipts (ADRs) are listed on the New York Stock Exchange (NYSE).

At June 5, 2006, ICICI Bank, with free float market capitalization* of about Rs. 480.00 billion (US$ 10.8 billion) ranked third amongst all the companies listed on the Indian stock exchanges.

ESSEL PROPACK Essel Propack is the largest speciality packaging company in the world manufacturing laminated and seamless tubes cater-

ing to the oral care, cosmetics, personal care, pharmaceutical, food and industrial sectors. The clients include top multinational companies as well as local & regional companies in the countries that it operates.

The company has its headquarters at Mumbai, India, and is a part of Essel Group.

Essel Group has a wide range of global business interests encompassing speciality packaging, media programming, broadcasting & distribution, entertainment, telecom & trading, having close synergies particularly with ventures active in the areas of content, distribution / reach and infrastructure / logistics.

Essel Propack has state-of-the-art manufacturing facilities in 13 countries through 20 plants, such as China, USA, UK, Russia, Germany, Mexico, Colombia, Venezuela, Philippines, Indonesia, Egypt, and Nepal besides India. The Company is ranked no. 1 in the manufacture of laminated tubes in the world and has an estimated 32% global market share. Essel Propack's stock is listed on the National Stock Exchange of India and the stock exchange of Mumbai in India.

Essel Propack was the first company to introduce laminated tubes in India. The company started in 1984 with an integrated facility to manufacture Laminated tubes and laminates in India.

In 1993, Essel ventured out to become a global player by setting its first overseas venture in Egypt. In 1997, the Company formed a wholly owned subsidiary in Guangzhou, China.

In December 2000, the Company acquired the tubing operations of the Propack group. Propack was the fourth largest laminated tube manufacturer in the World with operations in China, Philippines, Columbia, Venezuela, Indonesia and Mexico. This acquisition made Essel Propack the world's largest manufacturer of laminated tubes. In 2003, the Company set up a manufacturing plant at Danville, USA, to supply laminated tubes for Proctor & Gamble's North American operations..

Essel Propack's global operations have achieved a turnover of USD 149 million for the year 2004.

The write has taken liberal help of websites of mentioned companies while writing the broad profile.

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Edge 37

BOOKMARK

Good perspective on CRMs C

RM is at the forefront of marketing ideas and practices. The vast business writings attest to its popularity.

Moreover, with global CRM spending in products and services more than $15 billion in 2003, projected to grow to $17.7 billion in 2006, CRM is one of the top of business spending priorities.

Originally conceived as a technology, CRM has evolved into an enterprise-wide philosophy of maximizing customer value by placing the customer, rather than a product or a service, at the center of business decisions.

This view is the focus of the crisp 200 pager book Customer Relationship Management: A Strategic Perspective by Prof.

Shainesh and Prof. Jagdish Sheth.

The book comes in a start-to-finish fashion, with initial chapters defining and providing background and subsequent ones describing areas where CRM can be used and how.

It is in an easy-to-understand style without too much technical jargon. Diagrams and tables complement the text well.

Appropriate subheadings allow the reader to visually see the path of discussion. The extensive "References" section provides a wholesome list of books, magazines, journals and websites.

The book is divided into four parts: Concept, Applications, Technology and Implementation.

The first chapter, The Strategic Imperative, highlights emergence of service as well as market economy, global orientation of business and the aging population of economically developed countries as growth drivers of CRM. In Chapter 2, Conceptual Foundations of CRM, the evolution The

38 Edge

BOOK REVIEW Prashant Singh Kutaula Assistant Professor

CUSTOMER RELATIONSHIP MANAGEMENT G. Shainesh & Jagdish N. Sheth

of CRM is looked at with a brief on Anglo-Australian, Nordic and North American schools of tought.

CRM is aptly described as an old-new concept as merchants have been practising customer relationship from time immemorial. The authors also review the most commonly used definitions of CRM and find a commonality in terms of a process-oriented view, collaborative nature of the relationship and metrics.

In the chapter on Building Customer Relationships, the Peppers and Rogers IDIC relationship model is in focus. An interesting concept of ‘ladder of loyalty’ is explored to show how a prospect passes through customer, client, supporter, advocate and partner and is combined with a CRM

framework linking psychological steps of switching, satisfaction, trust, commitment and loyalty.

Economics of CRM lucidly explains the concept of market share vs the share of a customer, using the example of Maruti’s old warhorse 800. Concepts of lifetime value of customer and activity based costing (ABC) are suitably highlighted.

The second part begins with a review of CRM practices in service businesses and includes two Indian case studies — Implementation at Ritu Kumar's and Titan.

The third part on technology starts with Components of e-CRM Solutions where authors espouse a balanced CRM architecture approach which encompasses operational CRM and analytical and collaborative CRM. The role of Data Warehousing and Data Mining tools is highlighted. The functionalities of the main components of a CRM solution, viz., Campaign Management, Sales Force Automation and Customer Service and Support are discussed.

Product Offerings in CRM Space covers not only functionality and applications of CRM products targeted at large enterprises (Oracle, MySap) but also those at the SME (Sales Logix, Talisma, Onyx). Such a wide gamut of solutions and aggressive sales pitch by vendors often lead to confusion regarding selection of a suitable solution.

Authors have tried to simplify the managers’ task by presenting a list of criteria covering technical, organizational and price related aspects.

An integral part of CRM initiative is the contact centre. Initially intended to handle customer complaints, contact centres have

undergone a sea change, today handling a wide variety of operations ranging from sales, marketing, customer service and support.

The chapter on contact centres discusses their role in building customer relationships and the economics of starting one.

The fourth part has two chapters — The CRM Road Map and Operational Issues in Implementing CRM. Many organizations have burnt their hands implementing CRM as they adopted a technology oriented view and their implementation team was staffed primarily from IT. However, CRM needs to be viewed as an enterprise-wide initiative because a CRM implementation impacts all aspects of business, including processes, goals, orientation, focus, technology, performance and effectiveness metrices.

In the chapter on Operational Issues, the authors espouse a process view of CRM encompassing relationship formation, relationship management, governance, relational performance evaluation and CRM evolution.

The development of a customer retention plan and its evaluation is discussed.

Despite the detail, the book is not flaw free. The authors should have highlighted the teaching objectives of each chapter and provided a list of key terms as well as a set of questions for review and critical thinking. CRM is growing by leaps and bounds, so a website support for updation of content and additional test bank was needed. The technology orientation linkage of CRM with marketing needed to be built further with webshots of the screens illus-

trated in the text.

The review of major product offerings should have had data about the Indian market and a comprehensive tabular comparison of product features. The authors should also have strived to include more Indian cases on CRM in B2B markets, contact centres and lifetime value of customer. A glossary of terms section that helps to further clarify any of the words and phrases that are used should have been incorporated.

Other than that, it is a book useful for MBA students. It fills a vacuum in terms of being an authorative and detailed text on CRM in the Indian scenario.

It’s several Indian case studies and examples are gems that aspiring students can easily relate to and understand.

Leading by example L

eading Coherently draws leadership wisdom born out of rich experience from a diverse group of credible leaders across the world.

It give you an insight from the leaders to illustrate a natural and effective relationship between leadership formation, performance and sustainability culled from various walks of life, irrespective of gender, culture, and context.

These global players reveal how leaders are formed and how they influence others to achieve goals.

The book is divided into four parts, each with sub-parts.

Authors have interestingly maintained a flow and harmony between sections.

The book essentially focusses on human capacity and how leaders might best influence such

BOOK REVIEW Sahana Dey Fellow

LEADING COHERENTLY Mancy Stanford-Blair & Michael H Dickmann

capacity toward the achievement of goals. In all the four parts, it has been brilliantly portrayed how a coherent relationship between formation, performance and sustainability expands the consequence of leadership.

The uniqueness of this book lies in the adaptation of the Hawaiian tradition of "talking stories", which means sharing something about you with others. It has tapped the ancient practice of collecting and reporting the "talked stories" told by 36 leaders chosen from across the world, about their leadership qualities.

Part one starts with how a core of values and commitment is built up in leaders. It deals with the reflections of the leaders who reveal the fundamental elements of leadership. It tells you how leaders can be formed and are The

Edge 39

BOOKMARK not essentially born. Leaders have a set of values that do not change over time and that guide them in making difficult decisions. This is one of the qualities which makes them different from others.

Part two captures how in the minds of these 36 leaders, performance is strongly aligned with values and purposes, both in character and behaviour. It has been critically analyzed how values and character are aligned to three important elements of leadership — community building, centering, and thinking. It's true that a leader's performance and behaviour establishes influential connections to others which should be prominently social, emotional, and reflective in nature.

The most important element of leadership coherence — sustainability — is dealt with in the third part. The strategies leaders adopt to sustain their body, mind and spirit are well addressed in this

section. A relationship between sustainability and leadership formation and performance has also been tried to establish.

In the last part, lessons gleaned from previous parts are synthesized carefully to present a model for assessing and advancing coherent leadership.

This model interprets a dynamic and reciprocal relationship among the elements of leadership, viz. clarity of values and purpose, congruent character and behaviour, compounded capacity and resulting expansion of consequences.

This is a comprehensive book.

The language is simple and yet powerfully conveys the message.

Excerpts from original interviews/ conversations with leaders make this book interesting.

Another very distinct feature of the book is its intent to structure a leadership conversation that encompasses the reader's experience beyond the wisdom of 36 exemplary leaders.

After reading this book, one can say that a leader always culls and imbibes the positives out of adversities to form and reform him/her throughout their life.

Last but not the least, this book is recommended for anyone who wants to have a deep understanding of leadership.

Moreover, it is a quintessential book for students in leadership programmes as well as all aspiring and practising leaders who are interested in understanding powerful influences within their formation, improving their performance, and sustaining themselves and their purposes.

Leading Coherently offers great hope in creating better and more caring institutions and society for the future.

Authors Nancy Stanford-Blair & Michael Dickmann are professors in the Department of Educational leadership and the Leadership Center at Cardinal Stritch University in Milwaukee, Wisconsin.

Intellectual trade-off T

his book looks at international trade relations since 1945 from an intellectual point of view. It emphasizes on inter-governmental negotiations and the significant role of multinational corporations. The context is the changing political and economic environment.

The book is segregated into three parts: The Western system of interdependence, the North-South system of dependence and the EastWest system of interdependence.

The so-called Third World countries are coupled for trade negotiations in their own Group of 77 while Communist countries are isolated from the mainstream. The The

40 Edge

BOOK REVIEW Roma Mitra Debnath Assistant Professor

THE POLITICS OF INTERNATIONAL ECONOMIC RELATIONS John E Spero, Jeffrey A Hart

Western system is seen under 'crisis' but, at the same time, there is an interest in finding a solution acceptable to the various participants in critical periods. There is new information on monetary crises of the late 1990s, the early years of the World Trade Organization and the growth in foreign direct investment. It also includes an intensive discussion on

the relationship between globalization and governance.

The East-West system has a limited opportunity for growth though it is not in a crisis period. The authors have identified the limitations contributing to this problem as the doctrine of the Marxist community and the failure of Eastern economy.

The most controversial area addressed in this book is the NorthSouth system which is also going through a crisis period. The authors

have addressed this issue beautifully and have suggested a possibility of change in the scenario. Though the approach is Marxist, the opinion is fairly liberal.

The concluding part deals with the Fourth World. This is a further fragmentation of the Third World. Very few countries are able to cross the development gap whereas a large number are sinking into a more miserable state called Fourth World.

Though the conclusion is very

gloomy, it compels us to see the reality.

The general belief of the Western world is that the root of the problem lies in the culture of Third World countries. The authors presented an optimistic view of the Third World.

They portray them as entrepreneur havens where the enterprise culture is advancing fast. The authors opine that the Soviet Union is increasingly developing the characteristics of the Third World economy.

Witty business M

any recent books have dealt with the exciting realm of economic research — application of certain economic models to what most people would consider non-economic behaviour.

Steven Levitt's Freakonomics has made the economics of everyday life a trendy subject for readers. Tim Harford, writer for Financial Times, a World Bank economist and former faculty at Oxford, has caught the wave with his “The Undercover Economist.�

Freakonomics dealt with subjects concerning sumo wrestlers or high school teachers cheating or whether abortion in the 70s influenced the crime rate in the 90s.

These events are not related to a consumer's everyday life. This is not the case with The Undercover Economist. Harford has picked his topics carefully, using everyday products that we are all familiar with to explain basic economic concepts.

It is a field guide to economics and exposes the economic principles lurking behind daily events. he reveals how supermarkets, airlines and coffee chains are vacuuming money from our wallets. It

BOOK REVIEW Disha Dubey Fellow

THE UNDERCOVER ECONOMIST Tim Harford revolves around how coffee shops and supermarkets alter prices to target consumers who are not vigilant in their spending decisions, why buyers are always at a disadvantage in the used car market, how to improve the price and fairness of medical insurance and why

poor countries are poor. He shows how companies from Amazon.com to Starbucks have gouged consumers through guerrilla pricing.

The book does an excellent job of explaining economic theory through simple experiences of consumers. It explains underlying economic forces that apply to our everyday purchasing choices.

Harford does an excellent job of tying microeconomics to world economy. How buying a cup of coffee at Starbucks boosts Brazilian coffee exports to the US, which affects the US current account deficit that, in turn, impacts the US demand for foreign capital, which may affect interest rate levels and future economic growth. The author educates the reader from the basic to the cutting edge.

Content is presented in a practical way. Harford explains abstruse ideas like pricing along the demand curve and game theory using real world examples without relying on graphs and technical jargon. Covering an array of economic concepts, including scarce resources, market power, efficiency, price gouging, market failure and game theory, he tells you how these forces shape our lives.

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Edge 41

STUDENT CORNER FOREIGN PREDATORS

OIL MONEY MYSTERY

Bill Gates, the world’s richest man has said: "Indian market has the maximum opportunity in coming years". What impact will this statement make? The most visible is the intent of foreign multinationals on increasing footprints in India and to take the maximum profit share out of the Indian market.

Recently, the hostile acquisition of ROMSHA SINGH Arcelor by Mittal Steel and consequently the stand taken by the Government of India sent shock waves across India Inc. Industry observers felt like sitting ducks for MNCs vieing to enter the Indian market.

In many of the flagship companies, Indian promoters own less than 30% stakes and are worried how to protect their companies. Corporate India is concerned over the stand taken by the Government on the Arcelor issue, where it has clearly mention that acquisitions should be based purely on business & financial considerations. Effectively, this means that they do not have any legal tool to get protection from foreign predators. This is particularly true for firms engaged in sectors where FDI is allowed up to 100%.

Let's talk about HDFC. It is not a bank and falls in the category of non-banking finance companies where 100% FDI is allowed. It has no Indian promoters. Currently, FIIs own 67.79% of the institution. In fact, Citi Group has just bought around 10% ownership from Standard Life. In case, Citi Group decides to increase its take to 51%, at current market price it will cost just $2.55 billion! Is it a large sum for acquiring a majority stake in a company like HDFC? After the hostile acquisition of Arcelor, when Mittal was about to visit India an apprehensive Tata Sons decided to hike the stake in Tata Steel by 5%. But even after that, promoters' stake in Tata Steel is less than 32%. A hostile bid will cost $3 billion for 51% stake. Same is the case with the Aditya Birla Group which owns less than 25% stake in its flagship company, Grasim Industries. Market analysts say, at the current valuation, even after adding a premium of 25%, these companies are available as a cakewalk to MNCs. Should the Indian market be made so easily available to foreign predators?

The similarity between a devout Muslim and a modern day investor is that while the former kneels towards Mecca six times a day, the latter does the same to track the rising tide of petrodollars.

The biggest mystery in the coming days will be how petrodollars are being utilized. Oil prices have risen sharply since 2002 with the AAKANSHA MEHROTRA major oil exporting countries experiencing high export revenues.

The national income of these countries collectively has risen by 40%. The question being put forth is what is happening to this money? Part of it is spent on imports, while some is spent to build the sprawling buildings in Dubai, West Asia.

The consumption is on a boom there. The way the oil surpluses are being spent there, it seems they are preparing for a post oil era. A forecast by International Monetary Fund (IMF) points out that soon the current account surplus of the oil exporting countries will be much higher than the current account surplus of Asia. This will bring a fundamental shift in the world economy.

The availability of ample money in the hands of Muslims of Pakistan and elsewhere also sometimes puts a question mark. Are the Arabs passing this money to their Muslim brethren in Pakistan and other Muslim countries, which is used to raise arms and ammunitions against rest of the world? But the Arabs will be more cautious this time, unlike the 1970s, when a part of the sudden wealth, which came to them, was spent to fund white elephants and the rest was parked with American banks that used it for their own sake. The Arabs are now taking an intelligent step to move their reserves into special investment companies that are under no obligation like central banks to report their portfolio choices to regulators. But where are these investments (dollars, euros, share, gold, land, commodities etc.) heading? The mystery of Arab money might get solved one day. Till then the financial markets will be clutching and guessing where is the biggest windfall being put to use and the share prices, currency values, interest rates, gold prices will depend on where the oil money is heading.

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EDGE OVER CHINA

HUB OF GLOBAL ECONOMY

After 10 years of development, India has emerged as the world's No 2 software industry with an annual output of more than US$ 55 bn. Indian software companies quietly started to penetrate the Chinese market years ago with many engineers taking part in the software development of China's telecom, aviation, textile, transportation and financial industries.

VISHAL GOYAL Satyam, TCS, Infosys and Wipro all have business plans for China. As China excels at hardware production, these companies could help manufacture complementing software resulting in a win-win situation for companies of the two countries. China needs at least 1,20,000 entry-level software engineers per year, yet less than 60,000 are available at present, which could be met by Indian software firms.

The development of China's IT industry is quite unbalanced with the software sector, only one-fifth the size of the hardware sector. China has many software companies, yet most of them are small in size with less than 50 employees.

China has not been able to come up in the software business because of the low English proficiency and the protection of intellectual properties, which is the other major concern for foreign companies. The Indian software firms enjoy a few advantages over their Chinese counterparts: I.Indian companies are more flexible in making specialized goods, especially in designing management solutions.

II.As labour is cheap in India, China loses its advantage.

III.Indian companies have better R&D capabilities.

IV.Indian IT firms are high on efficiency and have rich experience in providing specialized software solutions.

V.The big Indian IT firms have proved their mettle in the developed economies of US and the European countries.

Chinese software makers focused on its fast-growing domestic market. But as competition intensified at home, they started looking at other countries, particularly US. Chinese software companies face formidable hurdles before posing a threat to India. And if big IT firms are able to meet with success in the Chinese markets, it would pave way for other medium and small IT firms to foray into China.

India, a nation with a GDP of $ 3,319,000 million, hoard of companies and plethora of resources has become a pivotal liaison in the chain of international corporate world.

Carrying on operations in almost all parts of the world, India, if not a forerunner, is not even lagging behind in the race to corporate development. It has successfully manAJAY NAINI aged to stand up and make its position on the international market podium.

Not only as an attractive land to make investments, India Inc, since its inception, has come a long way. India itself is chanelising its resources in foreign markets to grow and become a global competitor.

Companies like Tata, Birla, Infosys, Wipro are at par with international excellence. With examples like Nat Steel, which was acquired by Tatas, India is definitely making a mark on foreign lands. In the current scenario, all the countries have identified their interdependence. The corporate world is transcending not only geographical boundaries but also cultural and regional barriers in search of markets, resources and opportunities. India, rightly identifying the trends, is becoming one of the key players with mergers and acquisitions worth US $ 185 billion in 2005. India Inc now stands shoulder to shoulder with the leading economies.

Much of the credit goes to the changing policies that have made the business environment conducive for free trade.

Changes in economic policy of 1991 and introduction of concepts like privatization, liberalization, and globalization have given a boost to the trade, making the growth rate rise to nearly 8% from 5%. Also a change in RBI's credit policy from 100% to 200% of net worth of company have certainly encouraged and propelled the trade in India.

Today India Inc, like an elephant, is emerging as a powerful economy. Expanding its area of operations, India is becoming an attractive spot for foreign investors too. At this pace no target will be left unachieved and no target is unfeasible. India Inc has a golden future. India has proved to be one of the most promising countries, a pillar on which the edifice of global corporate world will rest.

The

Edge 43

STUDENT CORNER PLAY YOUR CARDS RIGHT

CHARITY BEGINS AT HOME

MBA students are seeking meaningful, productive and challenging work even before their curriculum is over. This approach not only benefits the student but also maximizes the return on their investment.

Many of us have no job experience therefore it becomes difficult to figure out what an organization expects from us. What one learns HIMANI PRAJAPATI from practical experience is unmatched with anything that the books provide.

It is important to get a desirable work during the summer internship, which is not an easy job. One has to drag the company's attention towards him by doing whatever the company wants him to do at that point of time. This may lead to self-promotion and an opportunity to learn.

Not all experiences are quite so rosy, but in any case, young employees get both a feel of the corporate culture and a taste of the work force during the course of these often finely crafted programs. Whether their time is spent in doing substantive work that affects the company, or just making Starbucks run all summer, there is a goal in mind.

Summer interns need to spend those precious weeks making a favourable impression in order to get that all-important full-time offer. The fate of the company may not hinge on the work interns produce. Optimum efforts must still be made on assignments.

Simply put, no matter how insignificant it seems, "whatever work you do, make sure to do a good job," advises one recruiter. Most businesses do not think kindly of employees who leave a vapor trail outside the door when they leave.

Connections, however informal, with established employees are important. Of course, even when interns generally play their cards right, one wrong move may stand between them and a job offer. At the same time, summer interns need to be careful about exposing, or more to the point imposing, their personality on their fellow employees.

Summer internship is the most effective way for students to test and evaluate career goals while contributing to the bottom line of your business. We need to find out what's important for us and what we will be missing without it.

Concern for the community is often mistaken for socialism. On the contrary, capitalism thrives only when every citizen is an asset in economic activity and has opportunities to succeed.

Corporate Social Responsibility (CSR) a misunderstood concept is viewed as a drain on profits. Philanthropy takes a back seat with the SHIVANGI AGRAWAL burgeoning expansion and robust growth of corporates in the economic arena.

Sanjay Bapat of indianngos.com explains that CSR is not philanthropy but a business process, where the institutions and individuals are sensitive and careful about the direct and indirect effect of their work on internal and external communities, nature and the outside world.

Thus every process, HR, Marketing, Finance and Production, within an organization would come under CSR portfolio. About 80% of CSR is business process and only 20% is philanthropy. It ensures that your people, neighborhood, customers, shareholders and business partners are happy with you, and the government and media looks at you with respect.

It is an outcome of the business models, chanelising the billions of poor to become the part of the market if helped.

Corporates in their efforts to engage in strategic philanthropy need to marry needs of community with business objectives.

Say for instance, a company can reduce the absenteeism of female workforce at the workplace by providing crèche facility, subsidized meals at the canteen and sufficient health care facilities in the vicinity.

Prominent organizations are heading steadily in this direction. Bank of India focuses on schematic lending for those below the poverty line under the various government sponsored programs. It has relationships with NGOs like Cancer Foundation, wherein the employees volunteer to support NGOs in noble causes as blood donation and eye donation camps. Clearly the reason to get into CSR is the mutual beneficial partnership between the corporate and the world around. I, hereby, conclude with the great saying, "We cannot all be great, but we can attach ourselves to a great cause."

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MUTUAL FUNDS INDUSTRY, AN INSIGHT he mutual funds industry is not new to India. It the Net Asset Value (NAV) starts at Rs.10. Later syshas been prevalent in India since the early 1980s. tematic investment plans are offered at the minimum Its mechanism revolves round three participants — price of Rs. 500 and can go upto any desired value. Genoffering company, asset management erally these plans have a continuity of SANDEEP KANDHARI company and investor. The investor is one month. The net asset purchase valthe one who does not want to invest in ue is calculated as the average of pureither the primary market or the secondary market and chases made at the beginning till the end. That is why is risk averse. in the current market scenario the investor tends to gain Mutual funds have seen lot of changes in two decades when the indices go up. For example if ‘A’ buys 100 units or more. There have been various highs and lows which at the NAV of Rs. 10 the purchase price will be Rs. 1,000. include the scam by Sameer Arora of Alliance Mutual Next month he purchases another 100 units at Rs.10.50 Fund. The scam lead the industry to its lowest in 2001. which would value Rs. 1,050. Thus the total purchase Under the present UPA made by ‘A’ in two Government, the marmonths is Rs. 2,050. ket regained and has Hence his net gain is seen a boom since Rs.50, or 2 percent in 2004. The market has terms of law of aversince then been able to ages. attract a lot of FII (ForThe companies noweign Institutional Ina-days have an entry vestors) which presentload or exit load sysly stands at $ 7.2 biltem. Suppose ‘A’ has a lion. The present team Net Asset Value of which includes the Rs.10 and there is an Prime Minister, Finance entry load of 2 percent Minister PC Chithe investor gets the dambaram and Planunits at an extra price ning Commission head of Rs.10.02. At this valMontek Singh ue he gets 998.04 units Ahluwalia, are largely and next month on the responsible for these purchase of 10.50 it investments. goes upto 147.05 units.

There has been a startling change at the indices. When His net gain is 1.874 percent due to the entry load. Now the present Government. took over, the BSE and NSE if we take the example of ‘A’ buying these units at an stood at 4,000 and 1,800 points respectively, while toexit load load of 2 percent he will get: day BSE stands at 11,500 points and at NSE 3,500 100 Units at Rs. 10 (NAV)= Rs. 1,000 points. Despite a correction in the month of June the 100 Units at Rs. 10,478(NAV)= Rs. 1,047.80 FII’s did not shy away from our markets.

The total value at the time of exit is 2,047.80 thus Most of the companies in the Indian mutual fund inthe net gain is Rs. 47.80 or 1.912 percent. Thus we can dustry including the big wigs like Prudential ICICI, State see that there is a gain when a company changes an Bank of India, Franklin Templeton and the Tata Mutuexit load. At times the asset management companies al fund have similar investor plans. The initial issue called charge both entry load as well as the exit load.

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STUDENT CORNER MANAGERIAL INITIATIVES IN PHARMA he pharmaceutical industry is one of the ponent of knowledge. most vibrant and rapidly growing indus Need for specific skills for this sector speciftries in the country. This industry today ically for handling management related issues. competes with sectors like IT & ITES. Industry’s Acceptance of industry specific managegrowth figures are estimated at around 13-14 ment programs by corporate as well as stupercent for the last 5 years. With more than dents. Since mid 1990's several private initia20,000 companies and a market size of about tives were undertaken by launching manage6-7 billion dollar, Indian pharmacy sector ranks ment programs exclusively designed for the 13th in terms of value and 4th in terms of volpharmaceutical sector. What started as an exume.The phenomenal growth witnessed in this periment has now been successful in meeting VARDAN SHASTRI sector is well complemented by the 2.9 milthe corporate requirements and fulfiling stulion jobs offered by Indian pharma companies. dent expectations to equip themselves with the necesAfter adopting the Product Patent Regime(PPR) in 2005, sary skills. Over the years B-schools have been producpharma majors are enhancing their productivity to being quality managers for the sector. The reason for this come globally competitive. Expansion by means of mergsuccess can be attributed to carefully devising the sylers and acquisitions and an increased focus on research labus suiting the needs of this industry. However, this does and development are the routes by which Indian pharnot mean that such programs are perfect. They come with ma companies are becoming globally competitive. All top their own set of flaws. The focus of a majority of these Indian companies like Ranbaxy, Sun Pharmaceuticals, Cipla, programs is towards sales and marketing.

Dr. Reddy's, Nicholas Piramal aim at maximising global However many management programs are slowly competitiveness by maintaining cost efficiency and adapting themselves to the changing scenario and are product innovation. modifying the course content to meet the needs of the The pharmacy sector has also changed from being a Pharmaceutical corporate. manufacturing based sector to a knowledge based secThere are number of professionals in the industry who tor. The transition has completely changed the functioning do not have management qualifications. This explains the of the industry. The sector now requires different types need to organise specific executive management programs of managers with distinctive knowledge, skills and attifor such working professionals so that they can learn the tude. To become an effective manager in a particular secbasic nuances of management while continuing their jobs. tor an individual must possess both generic as well as speExecutive MBA would be the mode of inducing mancific skills. For example a good human resource managagement perspective among such professionals. Such proer does not require pharmacy knowledge to work in this grams can either be focused on general management or sector. The same holds valid for other functions except be specifically function oriented. The program is usualmarketing. However a pharma marketer requires some secly flexible depending on the needs of the corporate at tor specific knowledge such as product launch dynama given point of time. It's a win-win situation for corics, process, consumer behaviour etc. A quick glance at porates and professionals. The former can expect an inthe profile of senior managers at pharma majors hints crease in productivity due to value addition in its manat the number of positions being occupied by general power, and the latter can simply become better profesMBA's without any pharma specific knowledge. sionals.

In early 1990's certain things started changing fast.

Managerial issues of the pharmaceutical sector will be Some of the industry specific changes are as follows: dealt at length so that the managerial dimensions of this New trends in the modern pharma company emerging sector is well appreciated. The potential of phar Global evolution of pharmaceutical industry as a commaceutical companies in India is known to all.

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E-WASTE DISPOSAL — A GROWING PROBLEM he industrial revolution due to advances products we should opt for the ones that have in information technology has radically been certified by regulatory authorities. Betchanged people's lifestyle. While the ter go for upgrading the computers and othworld is marvelling at the technological revoer electronic items to the latest versions rather lution, countries like India are facing an imthan buying new ones. Other things like toxminent danger. The technical prowess acquired ic content and energy saving capabilities should during the last century is posing a new chalbe looked at time of purchase. lenge in the management of wastes. E-waste We should take care while disposing e-waste. of developed countries, such as the US, in InThe initiatives like installation of specially dedia and other Asian countries. ‘E-waste’ is a signed bins at prime locations such as Forum HARLEEN KAUR BHATIA popular but informal name for electronic prodMall and Garuda Mall should be encouraged. ucts nearing the end of their useful life.

The installations is actually a part of the recycling proAccording to the Waste Electrical and Electronic gramme initiated by IT solutions company WeP PeriphEquipment Directive, e-waste includes items ranging from erals in collaboration with Saahas, an NGO. Except for large household appliances like ovens, refrigerators etc. the fastener, the specially made bins are a product of reto electronic equipment like chip boards. E-wastes are concycled material too.The recycling is done by E Parisara, sidered dangerous, as many components of electronic an authorised recycling centre, which follows a systemproducts contain material that is hazardous. The hazatic method of crushing, shredding and powdering the ardous content poses a threat to the human health and used electronic material. The waste that remains after environment. these processes is harmful to health and instead of throwA recent investigation revealed that much of the elecing it into waste land like most scrap dealers do, E Paristronics turned over for recycling in the US end up in Asia, ara stores them in sealed containers. where they are either disposed off or recycled with litThe India Inc. has also been targeted by the Greenpeace tle or no regard for environment or to the human health International for the handling of e-waste. Under pressure and safety. Major reasons for these exports are cheap from environmentalists, Indian outsourcing company labour and lack of standards in Asia.

Wipro has announced that in September it will offer a Computer wastes that are landfilled produces contafree e-waste disposal service to its PC customers. Earlier minated leachates which eventually pollutes the groundthis month, Greenpeace challenged Wipro and its chairwater. Acids and sludge obtained from melting computer man, Azim Premji, to be the first Indian electronics comchips if disposed on the ground causes acidification of pany to tackle the growing e-waste crisis.The environsoil. Similarly solder in printed circuit boards, glass panmentalist organisation Greenpeace International last Sepels and gaskets in computer monitors constitute lead tember dumped some 500 kilograms of electronic waste which has many ill effects, like causing damage to the outside the Wipro's Bangalore headquarters. central and peripheral nervous systems, blood systems and The activists targeted Wipro because it is an iconic Inkidney damage. Chip resistors and semiconductor condian company, and its adoption of environment friendtain cadmium which can cause toxic irreversible effects ly practices can set a trend for the rest. on human health, and neural damage, relays and Wipro has announced that it expects to have composwitches, printed circuit boards contain mercury(Hg) which nents in its PCs that comply with the requirements of Eucauses chronic damage to the brain and respiratory and ropean Union's Restriction of Hazardous Substances. The skin disorders. directive restricts the use of six hazardous materials in The graveness of the matter necessitates implethe manufacture of various types of electronic and elecmentable management measures. While buying electronic trical equipment.

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QUOTE UNQUOTE

India is a rising economic influence of power in the international system.

It's a great multiethnic democracy

[RatanTata's] $ 14.3 bn family conglomerate is a picture of what was and is India Inc

Condoleezza Rice

Forbes

US Secretary of State

We want to bring to the world various facets of this extraordinary country, its people and progress Chris Cramer

India could emerge as a global KPO hub as the business requires specialised knowledge in respective verticals and the country's engineering and technical institutes are geared to address the manpower demand CII Study India in the new knowledge economy

This market (India) is critical to our plans for building a Ford Motor Co. for the 21st century Bill Ford Chairman and CEO,Ford Motor Company

...India (is), the most promising and dynamic economies of the world. In this day and age of globalization, ...Scandinavian corporate leaders feel that, more than ever, it is of utmost importance to get to know industrial and political leaders in a country of India's stature Marcus Wallenberg, Chairman of the Board SEB, during a recent visit to India along with a CEOs delegation of top Swedish companies

India could emerge as a global KPO hub as the business requires specialised knowledge in respective verticals and the country's engineering and technical institutes are geared to address the manpower demand CII Study India in the new knowledge economy

International Managing Director, CNN

FDI will continue to be encouraged and actively sought, particularly in the areas of infrastructure, high technology and exports P. Chidambaram Finance Minister, Government of India

Not only are there brilliant engineers here [in India], I've been seeing that the entrepreneurial spirit of the businesses is second to none Mike S. Zafirovski President and Chief Operating Officer, Motorola Inc.

This is a historic moment for our country, for the entire Indian private sector and for Reliance. Reliance has become the first private sector company from India to be ranked among the world's top 500 companies in terms of the Fortune Global 500 list. We are now ranked 189 in the world in profits. The ascent of a first generation company, Reliance, to the distinguished Fortune Global 500 club is a tribute to the vision of our founder Chairman, Dhirubhai Ambani, and to the glorious spirit of Indian enterprise and entrepreneurship.

Anil D. Ambani when he was Vice Chairman & Managing Director, Reliance Industries Limited

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Continued academic excellence in IILM (AIMA-IMRB Survey 2006) This year, the study has been done by the Indian Market Research Bureau, the leading MR agency in India. The September 2006 issue of The Indian Management: The Journal of the All India Management Association has published a ranking of 214 B-schools based on specific criteria. The five parameters used for ratings are intellectual capital, admissions and placements, infrastructure, industry interface and governance.

IILM has been participating in the AIMA survey for several years and has been consistently rated as an A+ category B-school. This year’s results have confirmed this status of IILM. Only eight Bschools have been placed in the A+ cat-

ADMISSIONS & PLACEMENTS

INFRASTRUCTURE

INDUSTRY INTERFACE

GOVERNANCE

PARAMETERS INTELLECTUAL CAPITAL

INSTITUTE

egory, including IILM. The IILM has scored 90 percentile points overall. This means that IILM is within top 10 per cent of the surveyed B-schools. In terms of infrastructure, intellectual capital and industry interface, IILM ranks above institutes like IIM-L, IRMA & NITIE. However, such laurels have not created any sense of complacency. In fact, IILM has already put in place an ambitious programme for further enhancement of its programme content, delivery systems and academic ambiance.

OVERALL PERCENTILE SCORE*

With the rapid proliferation of B-schools in India, aspiring management students have a very difficult task in distinguishing the best from the rest.

B-School rankings are recognized the world-over as data-driven, unbiased indicators of overall academic and infrastructural standards of schools participating in the exercise.

Though there are many such rankings, prepared basically by media groups in India, there is only one which is undertaken by an apex management body, the All India Management Association. AIMA does the annual exercise through a specialist research agency.

Location

95 95 95 95 95 95 95 95 95 95

95 95 90 95 85 95 80 95 85 95

95 95 95 95 95 90 95 95 95 95

95 95 95 85 85 95 90 95 95 75

85 95 95 85 95 70 95 90 95 95

85 90 85 85 90 90 85 80 95 95

New Delhi Ahmedabad Bangalore Kolkata Lucknow Ghaziabad Anand Gurgaon Mumbai Jamshedpur

90 90 90 90 90 90 90 90

90 95 95 95 90 95 85 85

90 90 70 80 80 90 90 90

65 95 85 90 90 75 90 90

95 80 90 85 90 85 80 80

90 75 95 90 55 95 85 65

Bangalore New Delhi Lucknow Bhopal New Delhi Delhi Mumbai Bhubaneshwar

CATEGORY (SUPER LEAGUE) Indian Institute of Foreign Trade (IIFT) Indian Institute of Management, Ahmedabad (IIM-A) Indian Institute of Management, Bangalore (IIM-B) Indian Institute of Management, Calcutta (IIM-C) Indian Institute of Management, Lucknow (IIM-L) Institute of Management Technology (IMT) Institute of Rural Management (IRMA) Management Development Institute (MDI) National Institute of Industrial Engineering (NITIE) Xavier Labour Relations Institute (XLRI) CATEGORY (A+) Alliance Business Academy Asia Pacific Institute of Management Babu Banarasi Das National Institute of Technology & Management Indian Institute of Forest Management Institute for Integrated Learning in Management International Management Institute K J Somaiya Institute of Management Studies & Research Xavier Institute of Management

* The overall and parameter scores are percentile figures calculated as on average of range. A score of 95 for example, means that the institute is in the top five percent.

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Close encounters of the written kind

Mr Shourie advised writers to do a lot of reading and get into the skin of writing

Words are things, and a small drop of ink, Falling, like dew, upon a thought, produces That which makes thousands, perhaps millions, think — Lord Byron A writing workshop was organized on July 18 at IILM, Lodi Road. An ideal way to sharpen ones writing skills that help drown the demons of a writer’s block. Academics are always on the lookout for an arsenal of good writing tips and a state-of-the-art armoury of writing abilities.

The Boardroom, venue for the workshop, was abuzz with animated and before long Mr. Arun Shourie was ushered by Mr. Dinanatha Mishra, Prof. Pradip Chakravarty and Ms Disha Dubey.

Mr. Mishra introduced Mr. Shourie and Mr Sangeet Ragi, the two resource persons invited to conduct the workshop.

Mr. Shourie needed no introThe

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duction. He has authored many books besides having been the editor of the Indian Express. He has also held the office of the Minister of Divestment, Communication and Information.

Starting the workshop, Mr. Shourie said writing was an important communication tool which could be used to further knowledge of concepts relevant to society.

For a management institute like IILM, cultivating an intellectual writing capital was essential, he felt.

He said there was paucity of research and it was here that the faculty could step in.

He reiterated that a wellresearched faculty should provide useful tips to policy makers.

Recalling an incident from his ministerial days, he said when he searched for a research study on a particular topic to assist him in making an important policy decision, he was disappointed to dis-

cover that a country as large as India did not have any useful material on it.

As India suffers from a shortage of intellectual capital, Mr. Shourie advised writers to do a lot of reading and not shy away from getting into the skin of writing.

Aspiring writers should develop the ability to collect valid information from available resources rather than run around in circles looking out for some hidden material. Plenty of literature was available and one needed to just look at the right places and use those resources for writing, he added.

For reference purposes, only works by leading authorities should be preferred.

Like others, Mr. Shourie also believes in the writer's talisman that "rewriting is the essence of good writing".

To achieve a good writing result one should always check

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and recheck for errors. This, he felt, helps minimize grammatical mistakes. Be wise enough to keep three copies of the writing manuscript, he advised, adding that the smartest way would be to mail it to a friend or to one’s self.

The best way to overcome a writer's block was to keep on writing without getting confused and by being clear in objective.

He said he once finished an entire chapter of a book on a flight to London.

Reflecting on how he wrote Worshiping False Gods by just reading the voluminous works of Dr Ambedkar, he said it helped him derive certain aspects from just going through those works.

He also said that he wrote World of Fatwas by visiting Jama Masjid, buying some copies of a series of fatwas written in Urdu and getting a translator to translate them.

On his days at Indian Express, Mr. Shourie said he was possibly the only Editor who had the dubious distinction of having been fired twice by Indian Express.

Journalistic writing in India, he said, is based in many ways on

IILM faculty participation in the writing workshop

what the Government says and rarely about critically evaluating information.

Today, writers often take a balanced view trying to take both the sides of any issue; instead he opined they should take up one side of the issue.

Cultivating good public relations is another key trait a wise writer needs to adopt, believes Mr. Shourie. It proves to be a very potent tool for writers and helps them make friends they can use those relationships to advantage in time of need.

He felt Indians lack reading

habits and do not spend money on books. On a recent visit to Punjab he was disturbed not to find any bookstore. At Amritsar, he found liquor shops at every corner but no bookstore, only an odd stationary shop thrown in here or there.

Writing based on experience according to Mr Shourie has the capacity to explore factual truth.

He said he was always right on facts because he made sure that he used authentic records and research material.

To a question on whether a writer could be held captive by

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his/her own perceptions and use data selectively, he asserted it would not be right to do so.

To a dissenting note that it was not right to compare with the West and say Indians lack intellectual capital or produce only substandard studies he maintained that Indians need to be more dedicated and sincere towards research. Mr Shourie believes that the level of intellectual discourse in India is very low and leaves a lot to be desired and one could become an expert in any area by reading up just for a year.

He said very often people start commenting on books without even reading them. He said he was yet to come across a journalist who has read a book before asking questions on its launch.

He cited an example of how once a journalist asked him how he felt releasing his first book when he had already many to his credit.

Speaking from experience that one can print and publish very easily in today's times he advised would-be writers not to be dependant on big publishing houses as one could use the services of newcomers in the field who are more efficient and quick.

Mr. Ragi, Reader from Maharaja Agrasen College, shared his experience on what goals were needed to be adhered to while writng a research work.

The workshop concluded after providing a great deal of inputs to all. Workshops are good places to exchange thoughts and ideas. To become a good writer one has only to follow what William Wordsworth says very aptly said: “Fill your paper with the breathings of your heart…”

Such sincerity and honesty always fetches great rewards.

— By Fatima Khader The

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FACULTY DEVELOPMENT PROGRAM

Faculty Development Program in the area of Finance & Accounting

The FDP in Finance and Accounting area was conducted by Prof. Ramesh Gupta of IIM-Ahmedabad on 1st August 2006 at IILM Lodhi Road on the Topic: Computer Applications in Finance and Accounts. Prof. Gupta is a MBA and Ph.D. form University of Berkeley and an alumnus of IIM-Calcutta and AICWA. He has earlier taught at the University of California, Berkeley. He is currently a member of the Accounting Standard Board of the Institute of Chartered Accountants of India and SEBI's Mutual Fund Advisory Committee. His has published over 100 articles in reputed foreign and Indian journals and a book on `Inflation Accounting'. All faculty members in the area of

Finance and Accounts from the various campuses of IILM group-Lodhi Road, Gurgaon and Greater Noida attended the FDP. Besides discussing the application of computers in accounting, Prof. Ramesh Gupta gave some useful insights on The changing role of CFO. The discussion revolved around rearchitecting the finance function, what makes an exceptional CFO and Exceptional CFOs: An Indian perspective. He also gave some interesting inputs on usage of computer to handle certain areas of corporate Finance. Use of computers in finance was handled with the help of a case study.

The FDP received unanimous appreciation from all participants.

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PG Orientation An Orientation Program was held for the XIV Batch of PGDBM students from July 17-18 2006 to give them an overview of the Program. Prof. B Bhattacharya, Director - GSM, gave the inaugural address followed by a welcome address by Ms Sapna Popli, Dean.

The different areas of Management at IILM along with Faculty were introduced by Dr Naseem Abidi, Associate Dean, GSM. Later, Mr Naushad Mullick, Controller of Exams, briefed the students about the academic environment, pedagody and examination system at IILM. One of the reasons for the popularity of PGDBM is excellent placement offered to IILM graduates.

Dr Deepankar Mukherjee and Sumati Channa explained briefly about the services of the Placement Cell.

IILM, an A+ B-school, is well endowed both in terms of knowledge resources like books, journals, magazines and has state-ofthe-art IT labs. A brief overview

Prof. B. Bhattacharyya, Director, IILM lighting the lamp

of Library and IT Resources was provided by Mr Shantanu Ganguly and Mr Yavar Ehsan respectively. Later, Dr Irfan Rizvi and Mr Harsh Sharma undertook an interactive session on Goal Setting and gave tips on how to make the most of the top notch education given by IILM. Prof. Chakraborty and Ms Disha Dubey spoke briefly about IILM's vibrant in-house publica-

tion, The Edge, which has contributions from both faculty and students.

A hallmark of any successful Bschool is its continuous interaction with alumni. Ms Gunjan spoke about the activities of the IILM Alumni Cell.

All work and no play makes Jack a dull boy, so IILM has many student clubs for broadening the horizon of students. Prof. AN

XIV Batch of PGDBM students attending the Orientation Program The

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Bhattacharya introduced students to these clubs.

After liberalization in 1991, Education Sector has also witnessed many changes, a major one being a significant number of International Exchange Programs being signed up for student exchange. IILM has many such tie-ups, which were briefly touched upon by Dr Surabhi Goyal.

Case Methodology is a wellrenowned pedagogical tool at top B-schools around the world and at IILM also it is extensively used.

A case workshop was taken by Dr NL Ahuja and Dr Deepankar Mukherjee to highlight the appropriate way of participation in case studies.

The highlight of the 2-day orientation was the session on Stress Management by Swami Gokulanandji. Swamiji gave many tips regarding effective ways to combat stress.

IILM believes in Integrated Learning and what better way to showcase that then have a panel of corporate honchos in talk.

Panel experts discussed what corporates expected from students.

The experts were Mr. Basant Rathore, President, Dainik Jagran, Mr Santosh Chakraborty, MD, Touchtel India, Mr Kamal Bhasin, Sr. VP Indure, Mr Sanjay Dayal, DGM, HT Media and Mr NE Kumaraswamy, Regional Director, Hughes Communications India Limited.

The students resolved many queries through this first hand contact with the corporate world.

A B-school graduate has to inculcate social etiquettes for which well-known grooming expert Pria Warrick give tips.

The orientation concluded with distribution of student handbook, textbooks, course outline and the 1st semester time table.

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Twin-Integrated Management Development Programs on Financial Analysis for Management Decisions and Financial Management

Management Development programs get high attendance Twin-Integrated Management Development Programs on Financial Analysis for Management Decisions (Program-I) and Financial Management (Program-II), were organised by IILM at Lodhi Road from 24th to 30th August, 2006.

Dr. N.L. Ahuja, Dr. K.G. Ray, Prof. Gunjan Sanjeev, Prof.

Girish Tripathi, Prof. Meena Bhatia and Prof. Sweta Gupta were the resource persons.

Guest resources included industry experts Mr. Vijay Mehta (Stock Exchange Operations), Prof. S. Sampath (Corporate Tax) and Dr. D. Jagannathan (Strategic Cost Management).

The feedback from participants indicated that they had found the program content and the interactive sessions on various aspects of Financial

Management very useful, thought provoking and they greatly enjoyed the sessions.

We received fairly large number of nominations (14 in the first Program & 11 in the second program) from organizations such as NTPC (New Delhi & Noida), RITES Limited (Gurgaon), Oriflame (Noida), JCB India (Ballabgarh), Wipro BPO (New Delhi), Rajasthan Patrika (Jaipur) and SKH Metals (Gurgaon). Our senior alumnus, Mr. Sandeep Kandhari, who has over 8 years of industry experience, participated in both the programs. All the participants were given a 'Certificate of Participation' and a copy of a group photograph.

Special prizes (books) were given to a few outstanding participants.

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UG Orientation Day What sculpture is to a block of marble, education is to the human soul — Joseph Addison The Orientation Day of the B.Sc (Hons) Undergraduate students Batch 2006-2009 was held on Friday, 28th July, 2006.

The Program began with the lighting of the lamp by Chairperson Mrs. Malvika Rai. Prof. B. Bhattacharya, Director IILM, delivered the inaugural address recalling with verve the importance of collegiate education in shaping future leaders.

Prof. Kamal Ghosh Ray welcomed the students to the IILM stable and exhorted them to appreciate the fact that the Bradford B.Sc (Hons) degree offered at IILM is a high-end program far superior to many MBA programs offered by Indian universities.

Ms. Neeti Sanan, Asst.

Professor, introduced the UBS faculty to the audience and later delved on the association of IILM with Bradford University and gave the big picture of the B.Sc (Hons).

Ms. Shweta Khanna, Mr.

Mrs. Malvika Rai, Chairperson, IILM Lighting the lamp

Maneesh Mishra and Ms. Meena Bhatia, faculty members, spoke at length about the academic environment, pedagogy and learning in three stages of the three-year degree programme respectively.

Ms. Merlin Mythili, faculty incharge Program Office, made a presentation on the regulations at IILM outlining academic rigour and discipline required at IILM. This was followed by an interesting presentation that gave an overview of stage 1 modules by the respective faculty members.

The session started with an enthralling presentation by Ms.

Orientation Program of B.Sc (Hons) Undergraduate Students

Pria Warrick Exe. Director, Warrick Finishing School on body language, manners and etiquette which proved to be curtain raiser on the IMAGE course on personal grooming and development.

Ms. Shanta Bhalla of Perfect Relations introduced another value added course on communication skills.

Ms. Kakoli Sen, Associate Dean, extolled students on the international linkages and their benefits and talked about student societies at IILM that help pursue extra curricular activities.

Ms. Disha Dubey, Editor of The Edge, spoke about the magazine and encouraged students to use this platform to hone their writing skills.

This was followed a presentation by NIIT faculty on the value added course they would take up relating to computers.

The orientation day ended on a happy note that proclaimed in effect what Martin Luther King Jr. said "Intelligence plus character — that is the goal of true education."

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Convocation ceremony at IILM The 1st Convocation ceremony at IILM Institute, Gurgaon was held with great enthusiasm on September 13th, 2006. After completing two years at IILM, the graduating students saw their efforts translating into reality in a graceful function.

Ms. Kumari Selja, Union Minister of State (Independent Charge), Ministry of Urban Employment and Poverty Alleviation, was our distinguished Chief Guest.

Professor Badal Mukherji, Director, IILM Institute for Higher Education warmly welcomed invitees and the distinguished chief guest.

He expressed his gratitude and said he felt privileged that a legend of the corporate world who left an inimitable mark in higher education, graced the occasion.

Prof. Mukherji advised students on this big day to keep an open mind to go on imbibing the everincreasing flow of ideas, information and skills. He said this could be done only if one kept

Ms. Kumari Selja, Union Minister of State, Ministry of Urban Employment and Poverty Alleviation awarding the degrees

the fire of curiosity burning.

Dr. Padmakali Mishra, Dean, set the honours rolling by announcing the names of successful students. Heads held high, students walked up to receive their awards. They were greeted with a warm handshake from Chairperson, Mrs. Malvika

Mrs. Malvika Rai, Chairperson, IILM with Ms. Kumari Selja The

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Rai in their moment of glory.

The highlight of the ceremony was the speech delivered by the Chief Guest, Kumari Selja.

She began by extending her wholehearted congratulations to the Institute for creating a unique niche for itself in a short span of time, and offered her best wishes to the young graduates.

She built an exciting foundation by narrating how in the space of a decade India has emerged. Holistic development of infrastructure is taking place.

Major policies and projects like special economic zones are providing boost to the economy.

Foreign investors are making beeline. The graduates are destined to see during their early career itself that India will have eliminated poverty. All these would provide brilliant opportunities for technical and management professionals.

She quoted Goldman Sachs report that predicts India, China

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First Annual Convocation at IILM, Gurgaon

When you reach a stature in life, India will, if all goes well, have eliminated poverty and be in the ranks of middle-income countries. Some of you will have climbed your way to top of Fortune 500 and USA would be the three top economies by 2050, or sooner.

And if India plays its card right, it could occupy an even higher position. In this dramatic scenario, extraordinary times are waiting ahead for the graduates, offering the big challenge of change. They must anticipate the change and make things happen on India's own terms. We in India should

have the ambition of leading the change.

And she said, "Challenges, you will overcome" On a different plane she spoke of Bhagbat Gita which tells us that the goal itself is of limited utility. Rapid fame and fortune are not enough. The process matters. Enjoying the job is important. Work with all the passion in

There are extra-ordinary opportunities for those who are prepared to face the challenge of change. We in India should have the ambition of leading the change and make things happen on our own terms

The institute has a dream of becoming a global center of excellence in Management Education, Research and Development. This dream can be converted into reality, if we create the right 'ambition' and the right 'ambience' your heart. Work itself is its own fulfillment. Adopt a proactive approach. Reach out and explore different things.

Improve the quality of life of the poor. Touch lives of the common man. Make people successful. Play a strategic role. Finally, her advice, "be a good human being". That's success.

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A WINDOW TO IILM FOR FRESHERS The principle goal of education is to create men who are capable of doing new things, not simply of repeating what other generations have done — Jean Piaget In keeping with this philosophy, IILM’s mission is to become a centre of excellence in Value-Based Management Education, Training, Research and Consultancy.

A hearty welcome awaited our students and their parents at IILM, Lodhi Road campus, on the occasion of the 'Orientation of the Early College'. The orientation was held at the board room on June 25th, 2006 under the able guidance of the Director, Chairperson and Course Co-ordinator Ms. Kakoli Sen. We introduced this highly prestigious course of Cambridge International University in our institute.

Ms. Sen briefed students on the two examining bodies — CIE (Cambridge International Examinations) and EDEXCEL (London University).

CIE is part of UCLES (University of Cambridge Local Examination Syndicate) which also produces the school examination in the UK and tests English speakers of other languages. Ms. Sen further informed

Early College Orientation Program The

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Faculty introducing the courses to the students of early college

the students/parents that CIE qualifications are accepted and recognized by universities and other professional organizations across the globe. “At IILM our Qualifications Development Manager is dedicated to acquiring and documenting recognition for full range of CIE qualifications,” she said.

Frequently described the Gold Standard of the British Education System, the General Certificate of Education (Advanced Level) remains by far, the most popular and valued means by which students aged 17 or 18 can gain access to a degree program and the world of higher education.

The program is academic in

nature. The syllabi are designed to be challenging and stimulating. The General Certificate of Education (Advanced Subsidiary Level) or AS level, was introduced in 2000. AS levels are accepted in all the UK universities and carry half the weighting of an A level.

IILM early college will offer subjects like computing, accounting, business studies, economics and English language as a compulsory subject.

Students who secure high grades in their A levels will be eligible for the Gold Certificate Award which will allow them to pursue and complete a US graduation degree in three years.

The Early College students will also have an opportunity of being integrated into the three year undergraduate programme with University of Bradford, UK. At IILM, for the Early College, a trimester pattern of academics will be followed which has been clearly detailed in the handbook. The final exams are held every year by the Cambridge University between May 11 and June 9.

This program is run for two academic years and students take the

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board examinations at the end of 2nd year. There have been changes in the A level programme in UK. These changes introduced an element of breadth in the curriculum.

Now it is possible for students to take an examination on half the subject content of an A level at the end of the first academic year and be awarded an AS level qualification.

There are five passing grades (A to E). Minimum Matriculation requirement is at least two pass grades.

In order to prepare our students of Early College at IILM, internal examination per term along with an internal assignment/mock tests for the final exams has also been designed.

Students are required to compulsorily attend all classes as per choices indicated and have a minimum of 90% attendance in all subjects.

This was followed by an introduction of the faculty members (Mrs. Madhu Garg - English, Ms. Disha - Economics, Ms. Himadri Economics and Accounting, Ms. Damini- Computing and Mr. Girish - Accounting and Business Studies) to students and their parents by course co-ordinator Ms. Sen. They were briefed about the modules, contents and teaching methodology to be followed in classes. Students also filled up forms indicating their choice of subjects.

Thereafter, Ms. Tanya, from Admission Office, took the students and their parents for a round of the campus. Ms. Sen had a one-to-one interaction with parents and students and answered queries on academic & administrative issues.

Refreshments were served during interaction. The program ended with the distribution of the time table for classes beginning July 26 and thank you note by Ms. Sen.

NETHERLANDS COMES CALLING

VISIT OF PROFESSOR/ STUDENTS FROM RADBOUD UNIVERSITY NETHERLANDS

RADBOUD UNIVERSITY, NETHERLANDS: A delegate team comprising 30 students and one Professor visited IILM, New Delhi campus, on 1st August, 2006. The students represented the school of business and administration and were on a special visit to India to conduct research in Indian markets.

A brief introduction about IILM was held. The Netherlands Embassy was represented by Mr. Giovanni Van Der Lugt, Head Economic Affairs, and Ms Ravleen Pal, Business Representative of The Netherlands Embassy.

Mr. Giovanni and Ms Sapna Popli, Dean Graduate Business School, IILM, encouraged and motivated students to make good use of the seminar and develop ties with professors.

A special seminar on Understanding Indian Markets and Consumers was held. Students received lectures from Prof. Tarun Das, Dr. Deepanakar Mukherjee and Dr. Rajesh Pillania.

The students were impressed by especially Prof. Das and Dr. Pillania.

Dr. Deepankar enthralled them by teaching them marketing vis-a-

Mr. Giovanni Van Der Lugt, Head Economic Affairs, Netherland Embessy

vis soccer, the favorite sport in The Netherlands. The students then split into the groups to receive more personalized attention.

POSSIBLE AVENUES: A team led by Professor K.G.Ray, Director Undergraduate Business School, interacted on the possibility of conducting joint research work.

The team initiated the effort to explore the exchange programme in the following areas: Faculty Exchange Student Exchange Programme Exchange Research and Development Affiliations The professor from Radboud University was very excited for having collaboration and gave a detailed copy of the university and its international exchanges.

The Nijmegen School is very keen to have international collaboration.

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LIFE BEYOND IILM HORIZON IILM organizes a refresher course, namely a summer school, with topranked and distinguished institutes around the globe. The institute believes that such courses offer students the unique opportunity to explore, combined learning, innovative enrichment and actionpacked adventure in notable and recognized institutes.

This summer, students went to the University of California, Berkeley, and the London School of Economics (LSE).

On 1st July, Rajeev Pugla, Rahul Jain and I, Atif Ansari, undergraduate students boarded the first flight of the day — BA 0256 — from IGIA to Heathrow. The journey was comfortable as we almost slept the whole way. From Heathrow, we took a train to High Holburn and checked into our respective rooms.

The institute had provided the accommodation.

We got ourselves registered for the London School of Economics Summer School from 2nd July to 21st July, 2006. Summer school started with a welcome speech and orientation. It was followed by a lecture on Competitive Strategy and Game Theory. The strength of the class was 35 and students from all over the globe with different ethnicities could be spotted.

After three hours of lecture, we finally got an hour’s break and then the tutorial followed where we were divided into a class of 12. By 5pm, our first day at LSE came to an end or so we presumed.

But, for people at LSE life had just started. We started mixing up with our roommates and people we saw in the lecture and tutorial. We played soccer, pool, table tennis, video games, poker and watched TV etc. There were many cultural activities happening at the same The

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Students attending a refresher course at the University of California, Berkeley

time. We had our supper and moved to the study room. Most of us were busy till midnight, as we had to present a case study and prepare ourselves for the next day’s lecture and tutorial.

The following day was almost the same except that it was more strenuous. We had a fresher's party at night. Ten days later, we appeared for our mid-term and faired well. The routine continued until 21st July. However, the later weeks added further amusement, entertainment and excitement. We

Students exchange program

appeared for our final term and headed off from LSE. Twentyone days of intense summer school had been very laborious. But for people who could tackle it well, LSE's pub was the right place to be. After all, the student's hub was there.

The quality of teaching at LSE is far beyond words. We owe a lot to Dr. T. Kretschmer and Prof. K. Srikanth. Their teaching approach was incredible. We thank them and hope they will think over the unwary request we made them, to come down and teach for a few weeks at IILM. The only grey area was the short period of stay. We made a lot of friends and hope they will be a part of our lives throughout. During our trip, we also visited Scotland and other places in Central London. One could not even think of coming back home with empty bags, so we shopped a lot. Yes, a girlie trait we had acquired for the time being — 'shop, shop & shop'!

In the end, we would like to thank Dr. Surabhi Goyal and Ms. Shweta Gupta for all their support and guidance and our parents for their encouragement.

We hope to see more and more undergraduates going for the summer school in the years to come.

— Atif Ansari

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Corporate Connect @Placements The enterprising and industrious students at IILM, Lodhi Road, have valuable inputs and skills being taught to them in the classrooms by the best of faculty.

However to bridge the gap between theoretical and practical aspects of the curriculum, Industry and Corporate Interaction is extremely important.

The IILM, Lodhi Road, Placement Team recognizes this need and addresses it through the Corporate Connect @Placements.

Regular associations and meeting with corporates provide industry exposure to the students and enable them to pick up new skills other than what is being imparted in the classrooms.

Some of the Corporate Connect initiatives in the Fourth Trimester are mentioned below:

TOPIC Panel Discussion on "Corporate Expectations from MBA Students"

NAME OF SPEAKER Mr. Sanjay Dayal

COMPANY HT Media

Dy. General Manager

Mr. Basant Rathore

Dainik Jagran

President

Mr. Santosh Chakraborty Managing Director

Mr. Kamal Bhasin

Blaser Swisslube India Pvt. Ltd. Indure Pvt. Ltd.

Sr. Vice President

Mr. N.E. Kumaraswamy Regional Director

Live Project

Mr. Sachin Sodhi Regional Director

Mr. Ruchir Aggarwal Manager Sales

Mr. Hemant Kumar Asst. Branch Manager

Live Project

Mr. Amit Arora

Hughes Communications India Ltd. Kotak Mahindra Old Mutual Life Insurance Ltd. Kotak Mahindra Old Mutual Life Insurance Ltd. Kotak Mahindra Old Mutual Life Insurance Ltd. Reliance Life Insurance Co.Ltd.

Sr. Sales Manager

Ms. Vaishali Grover

Reliance Life Insurance Co.Ltd.

Sr. Sales Manager

Mr. Nitin Trikha

Reliance Life Insurance Co.Ltd.

Sales Manager

Mr. Tushar Vikram Bopche

Reliance Life Insurance Co.Ltd.

Sales Manager

"Customer servicethe key success factor of retail industry" "OPTIMIZING One's Potential" Internet Business

Mr. Anirudh Yadav Asst. G.M. (Food Supply Chain)

Mr. Pradeep Menon Vice President (HR)

Mr. Vineet Singh

Reliance Industries Ltd. (Retail) Primus Telecommunications India Ltd. Naukri.com

Sr. Vice President (Domestic-NEW & Intl.Sales)

Service Marketing

Mr. Jawahar Sen Vice President - North

HR Practices

Mr. Vivek Gera

CHR Global (HR Services) Pvt. Ltd. Centurion Bank

Regional Resource Manager

Industry Trends - Job Scenario for MBAs Compensation Management

Alumnus from 2004-06 Mr. Vijay Srivastav

Apollo Tyres

Sr. GM (HR)

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The grand galore

Students performing on teacher’s day

A grand galore. That's precisely what the cultural evening was.

The event co-incidentally or quite intentionally was scheduled for the 5th of September which was also Teacher's Day. The welcome party for the new PGDBM Batch of 2006 was impeccably organized with the last detail sorted out.

Such a warm welcome by PG 2 students was heartening for us.

The dance, songs and mimicry items that were performed by the PG1 and PG2 students spoke volumes of their talents. The function was attended by PG faculty members, The show was compered by Priyanka from PG 1 and Pari.

The cultural program proved that students at IILM are not just hard working but creative as well.

The idea behind having this cultural event was to facilitate interaction between the two batches.

We are thankful that seniors took time out from their busy schedules to organize the entire event.

Abhinav Dandia PG-I

Workshop on global marketing IILM in association with PHDCCI organised a two-day workshop on International Marketing at Chandigarh on 23-24 August, 2006.

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NEW JOINEES Prashant Singh Kutaula Assistant Professor Prashant Singh Kutaula has 7 years of teaching, corporate and entrepreneurial experience. He is an MBA from IIM, Ahmedabad. He has worked as Key Accounts Manager in HCL. He has an international stint with Toyota Motors. He also ran a successful Education Services Company in Ahmedabad. Before joining IILM, he was FacultyManagement and COO of Incubator at National Institute of Design (NID) Ahmedabad. He has conducted workshops for Industry on Creativity and for students on Entrepreneurship and Interviews. His teaching interests include Business Communications, Creativity and Innovation, Entrepreneurship, Services/ Strategic Marketing.

Dr Sahana Dey Fellow Dr Sahana Dey is a PhD in Educational Psychology from Banaras Hindu University. She has done her M.Ed, B.Ed & B.Sc(H) from BHU. Dr. Sahana has worked as a program executive with an international funding agency, Catholic Relief Service & with Centre for Education & Documentation, an NGO in Mumbai. She has been associated with the International Management Institute. Her area of interests includes Emotional Intelligence, Corporate Social Responsibility.

Roma Mitra Debnath Assistant Professor Roma Mitra Debnath has seven years of teaching experience. She is M.A. (Stats) and an M.Phil. from Delhi University. She has published papers in refereed Journals such as Decision, Productivity, Quality Assurance in Education, International Journal of

Business Performance Management and ORSI Conference Proceedings. Area of research, among others, include centers on performance and efficiency. She has participated and presented her research in national conferences. Her areas of interest include consumer satisfaction research and statistical analysis.

Girish Ahuja Fellow Mr Ahuja has a teaching experience of 6 years in Accounting and Finance.

He is a Post Graduate (M.Com) with specialization in Finance from Delhi University. He has a PGDIM from IGNOU. He was awarded Junior Research Fellowship (JRF) in National Eligibility Test (NET) conducted by UGC in 1999. His core areas of interest include Financial Accounting, Management Accounting and Financial Management and Portfolio Analysis.

Himadri Dutta Faculty Associate Ms Himadri Dutta is a B.Com (Hons) from Gauhati University & ICWA Intermediate from the Institute of Costs and Works Accountants of India. At present, she is teaching economics and accountancy in Early College at AS and A level. Her core areas of interest are Costing & Financial Management.

Ferojuddin M. A. Khan Assistant Professor Mr. Ferojuddin Khan is a Fellow member of ICWAI, a Licentiate Company Secretary (ICSI) and M Com. He has 15 years of corporate & teaching experience. He has worked with both Public (NTPC, BYN) and Private sector enterprises in the core sectors of Economy like power, heavy Industry, financing etc. He also taught in many prestigious institutions

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ACADEMIC ACHIEVEMENTS B. Bhattacharyya

HSMI/HUDCO on Feb. 13, 2006.

Director

❘❘❘❘❙ A monograph entitled "State Trading Enterprises in WTO Negotiations: A Developing Country Perspective" was prepared and published by Oxfam (India) under the Make Trade Fair Project. ❘❘❘❘❙ The Revised 20th Edition of the book International Marketing Management by Bhattacharyya and Varshey was brought out in 2006.

❘❘❘❘❙ Was invited by USEFI to be a member of the Selection Committee for American Fulbright Students who would be visiting India in the academic year 2006-2007. ❘❘❘❘❙ Consultancy done for JBIC sponsored SAPROF (Special Assistance for Project Formulation) Study on Amritsar Water Supply and Sanitation Project, April-May, 2006.

Dr. Tripti P. Desai Professor

❘❘❘❘❙ Alfred P. Sloan Foundation and the Chicago Center on Parents, Children, and Work, invited Dr Tripti P. Desai to be a speaker at the international conference, Why Workplace Flexibility Matters: A Global Perspective. The conference, hosted by the Sloan Foundation in collaboration with the University of Chicago Sloan Center, was held in Chicago May 16-18, 2006 at the Gleacher Center. The conference included researchers and policy makers from the U.S. and other nations.

The conference session for presentation was titled "Looking Abroad'.

Dr. Madhusree Mazumdar Professor

❘❘❘❘❙ Training Session taken on Planning Healthy Cities: Issues and Concerns, for an International Training Programme for Overseas Professionals on Urban Infrastructure Planning and Management" conducted by

Ms Sweta Gupta Fellow

❘❘❘❘❙ Presented a paper on "Yield Curve: Economic Indicator and Role of Central Bank" at the Seventh International Conference on Operations and Quantitative Management organized by AIMS International, held between 3rd5th August, 06 at Jaipur. The paper dealt with the significance of different shapes assumed by yield curve and the role played by central bank in governing those shapes. ❘❘❘❘❙ Conducted a session on "Capital Structure Decisions" in the Twin Integrated Management Development Programs on Building Financial Skills held between 24th 30th August at IILM campus.

Gunjan M Sanjeev Associate Professor- Finance and Banking Deputy Director ( International Office)

Conference on Global Best Practice with Cambridge

Research paper titled "Data envelopment analysis (DEA) for measuring Technical efficiency of banks" has been published in Vision, Vol 10 No. 1, 2006.

Cambridge International Examinations (CIE) organized a conference on 4th September at Intercontinental Grand Hotel in New Delhi wherein the faculty members of Early College,IILM, namely Ms Madhu Bhatia, Ms Himadri Dutta, Ms Damini Grover and Mr Girish Ahuja participated.

The theme of conference was to equip the teachers about CIE Courses and tools to provide them with best educational experience.

Teachers from various schools across the country participated in various workshops and interactive sessions.

Our faculty members attended following workshops:

SEMINAR PARTICIPATION ❘❘❘❘❙ Presented at a symposium in the International Conference of Applied Psychology at Athens Greece on 'Work and Family Conflict in the Emerging Economies: Israel. Taiwan Turkey and India. In July 16-21st.

ed in IILM (24th -26th August 06) on 'Financial Analysis on Management Decisions'

Vandana Srivastava Area Head - IT, IILM

Attended a seminar on "Challenges of European BPO Market" at MDI, Gurgaon on 24th August, 06. The seminar brought together industry and academia to bring out the Issues and Challenges of European BPO Market and the Strategies for BPO Business Growth in Europe.

Meena Bhatia

❘❘❘❘❙ Curriculum Support and Professional Development

Assistant Professor

❘❘❘❘❙ Took sessions in the Management Development Programme conduct-

❘❘❘❘❙ Learn more about CIE

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3- Lodhi Institutional Area Lodhi Road New Delhi- 110003 Phone: 91-11-43559300 www.iilm.edu