VOL. XXXXVI NO.4
OCTOBER 2020
CONTENTS
CHINA: Business, Technology & Economy in 2020
The Art & Power of Nudging M S Narayan
Partnerships in the Age of Covid Panel Discussion
Transforming India & Indian Businesses Pradeep Deshpande
Women Leader Series: Policing in Covid Times & Beyond
Lakshmi Venkatachalam
Panel Discussion
EDITOR Gp Capt R Vijayakumar (Retd), VSM EDITORIAL SUPPORT Gp Capt Dr R Venkataraman (Retd) LAYOUT EXECUTIVE D Rajaram
MADRAS MANAGEMENT ASSOCIATION Management Center, New No.240 Pathari Road ﴾Off Anna Salai﴿, Chennai 600 006 Ph:044‐2829 1133 Email:mma@mmachennai.org | mandate@mmachennai.org www.facebook.com/mmachennai
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EDITORIAL
Gp Capt R Vijayakumar (Retd), VSM
Time to Look at Innovation, Health & Women Entrepreneurship
T
he “Winners”, during a crisis, get a few things right:
restrictions, a few companies are able to gain advantage. A
They protect and even reinvent the core of their
shock like Covid19 can bring about lasting changes in
activities with agility; they trim fat and add muscle.
consumer behaviour; and those firms that are quick enough
MMA too has undergone a transformative change with the
to spot consumer changes, have already modified their
conduct of its activities. I firmly believe that the impression
business models to reflect them. They are not reluctant to
that India has reached the Corona peak in September suffers
make investments in innovation to reap rich dividend. The
from fallacy of inference. The conclusion is based on limited
market research firm, Nielsen, said it recorded 1897 product
inputs; the number may rise again, with all our shambolic
launches in the health and hygiene portfolio since March 2020
systems and amusing statistics. It is a pity that our shifting strategies are based on mathematical models of a limited theoretical frame. The MMA Committee has taken a conscious decision to wait for few more days before we could take a call on offline activities at MMA. But not to worry, the Covid19 experience has indeed turned out to be a longterm gain for MMA to present outstanding events with the participation of speakers and viewers from around the world. Covid has been a wakeup call for India. It will be quite some time before we understand the full impact of the
The market research firm, Nielsen, said it recorded 1897 product launches in the health and hygiene portfolio since March 2020 compared to 102 in the previous six months’ period till February 2020. Companies and individuals, however, need to be cautious about how consumer demand shapes up for most innovations once the pandemic subsides.
pandemic. Even during severe economic downturns and OCTOBER 2020
3
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compared to 102 in the previous six months’ period till
The International Heart Day was observed on 29th September,
February 2020. Companies and individuals, however, need
and it has come as a reminder that it is more important than
to be cautious about how consumer demand shapes up for
ever to pay due attention to our health, and in particular, to
most innovations once the pandemic subsides.
our heart. Another issue increasingly becoming a cause of concern is mental health. More so, in India, given our poor
CavinKare‐MMA Chinikrishnan Innovation Awards
awareness and stigma associated with mental illnesses and
Innovation leads to progress. It has propelled India to a higher
inadequate health infrastructure, we strongly believe that the
plane. We are now in the top 50 league in the Global
first step towards solving this lies in enabling mental health
Innovation index. We are indeed privileged to play a small
literacy among stakeholders. MMA is organizing a series of
role in catalysing people responsible for stunning innovations.
lectures by outstanding thought leaders in association with
In this context, I am delighted to share with you that the
Buddhi Clinic, NHRD and KAS.
CavinKareMMA Chinikrishnan Innovation Awards Function is scheduled to be telecast on a national television channel at
The legend is gone, but his legacy will live on…
06.00 pm on 10th October 2020.
Fans around the world mourn the demise of one of India’s
We strongly believe that for innovative products to
greatest playback singers of all time, lovingly called SPB by
succeed in India, we must address the pain points of the
all. One keeps wondering why is it that millions feel that they
majority who are poor. Late Mr Chinnikrishnan, the father of
have lost one of their family members and what is it that
Mr C K R, too believed that for products or services to scale
differentiated him from other great singers. A true leader
they need to innovate along with the enduser or customer.
displays humility in success, remains humane in approach,
Most importantly innovations need to be affordable, scalable
and always appreciates team members. This is what has earned
and sustainable. The award is our way to encourage small scale
him legions of fans.
industries. Please do watch the telecast and get inspired.
MMA is fortunate to have hosted him for an event to pay tribute to late MSV. I still remember that during this event his
For women entrepreneurs
eyes always expressed only kindness and admiration for all
The only one challenge that every women entrepreneur faces
the achievement of others. As a tribute to late SPB we present
too often from parents, friends and even spouse: Doing
to you the talk by him to the Members of MMA from our
something about it! But the spirit with which they have taken
archives—Watch SPB share his experiences and relive his
it is what matters. When women go out there to change the
greatness by clicking the link here.
narrative, the journey is excruciatingly difficult but the reward is extraordinarily satisfying. In this context, MMA launched a new initiative—guided by Mr V Balaraman, Past President, MMA—with the forming of “MMA Women Business Council” to showcase women achievers and their incredible feats. Listen to Ms Zia Hajeebhoy share her inspiring story of entrepreneurship. Of health...
4
OCTOBER 2020
Thank you so much for reading—and all the very best for managing whatever the rest 2020 has in store for us!
They think big and want to be number one... They are, in general, implementers of technology, not particularly inventors; and they are not ashamed about that. suitable technologies, factories and opportunities. China is a very large country, three times the size of India. The population is almost similar. They have one common language—except for two or three of the farflung provinces—which helped in bringing and keeping them together. The unemployment is very low at 1.7% and youth unemployment is remarkably low. India has something like 23%. The few good things that they did I have lived in Hong Kong and China for
and a lot of support from some of the
started from 1978. Premier Deng
a little more than 10 years. I have been
developed countries nearby. The
Xiaoping brought in a sharp focus. He
very much interested in their culture
Northeast provinces like Heilongjiang
tried to open the country and develop it.
and made a lot of good friends and
and Liaoning were adopted by Japan.
In 1978 when he took over, there were
business associates. I have tried to learn
Places like Shandong got support from
88% of people below poverty line and
a lot from them.
Korea. Fujian was adopted by Taiwan
today they are at 1.7%. Life expectancy
If we look at the map of China, we
and Guangdong by Hong Kong. Thus,
from 1978 to now has improved by
can understand how the transformation
the strong influence came from these
about 10 years. Infant mortality has
happened with the State's own interest
neighbouring countries and brought in
come down from 53 per thousand to 8
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per thousand, and literacy also
Along with Deng Xiaoping, there was
factories—400 of them owned by China.
improved to 96%. The State provides
another economic mind—Zhu Rongji,
The road from Shanghai to Myanmar is
free education up to class 9. Labour
who contributed a lot to where they
so well developed that fabric is able to
force participation by women is 60%,
have reached today and how they think
reach from the textile mills in Eastern
whereas in India it is about 25%. That
now. Government policies are in place
China to the border of Myanmar in 10
means the State has provided jobs,
to create selfsufficiency, stability and
days. Also, Myanmar is one of the
income, healthcare and education.
continuity. That is the bigger approach.
countries where the important Mekong
China’s economic liberalism is a
They have something called the
transformation story of 40 years. In
‘whole nation system’ which started as
1980, their GDP was less than India’s.
a system to support sports and develop
Today they are at about 14 trillion and
a number of worldclass athletes. There
India is at 3.2 trillion. China is a global
is also another parallel system for
River flows. Water, of course, is a resource of the future. China has a lot of interest in Pakistan and Myanmar for these reasons. Pakistan gives them access to the Gwadar port and has river water up north.
China has made a lot of developments and inroads into Myanmar, to an extent that Myanmar is like another province of China. In Myanmar, there are 600 garment factories—400 of them owned by China
China has developed infrastructure extremely well—power, roads, railways, ports and communication. They think big and want to be number one. Even within their subsystems, they aspire to be number one. They are, in general, implementers of technology, not
trading power. They are trading at
education. Some of their best minds are
particularly inventors; and they are not
4,600 billion dollars with 54% exports.
grown in special universities and
ashamed about that.
India’s trade is about 844 billion.
military universities and are developed
The people want to be safe and
China's trade with India is about 100
for serving the country. China has global
respected. They are a collective lot and
billion dollars. For them, we are not a
ambitions. You take the Belt and Road
do not stand up as individuals. They
very big trading partner. But for us, they
Initiative, which is a big Silk Road kind
work as a team. They look up to the
are important because we import 75
of movement to connect countries from
government, and the government unites
billion dollars of products from them.
China to Asia, Africa, Europe and
them. They cannot perform without a
China has tweaked RMB to USD very
Australia.
leader. They are good at working as
opportunistically and intelligently, and
China has made a lot of inroads into
tries to maintain parity where imports
Africa because Africa has a lot of
and exports are both supported. In
minerals. They are not there in Africa to
Guangxi and Renqing
essence, China is a very interesting mix
make textile garments. China has made
Guangxi and Renqing are two important
of Confucian tradition, communist
a lot of developments and inroads into
concepts. Guangxi means relationship.
orthodoxy and super capitalism!
Myanmar, to an extent that Myanmar is
They are very particular about personal
like another province of China. In
and business relationships. Vendors try
Myanmar, there are 600 garment
to support each other. Even if there is a
How do the Chinese think? 7
OCTOBER 2020
teams.
Business Mandate fountainhead of excellence
minor accident on the road, drivers get
From Three Gorges to the Great
down, exchange cigarettes and start
Railway: The Han penchant for
making relationships!
greatness
People have ‘hope’ as poverty has been removed. For them, Apple and Amazon are not the happiest places to work. China’s story is somewhat like that. Happiness is not the important thing. It's about being successful and their nation being an important
2,000 gigawatts and 25% of that is coming from new energy. They have the vision
to
identify
new
energy
opportunities like solar, wind and nuclear. They set up and commissioned the Three Gorges hydroelectric power plant, which is one of the wonders of
country! They
focus
on
setting
up
infrastructure projects and identify potential industries like steel, mining, cement,
automobiles,
aluminium,
fertilizers, machine tools, armaments and food. As time progresses, they are willing to recalibrate the list of potential industries and add artificial intelligence,
drones,
ecommerce,
electric vehicles, robotics and space. So firstly, they identify the right industries and then the government supports them
They
invest
first,
start
developments and coursecorrect later. It is not uncommon for the pollution control board people to go to the factories with chain and padlock and lock it up. They shut down all the small dyeing units and revised their standards for water pollution, several years after developing the industry. In general, their approach is to finish projects ‘ontime,’ if possible to finish ahead of schedule. OCTOBER 2020
modern
engineering
world
with
generating capacity of 22.5 GW. It took them 14 years working 24 x 7. They helped in resettling some of the villagers. It has also helped them to control the flooding problem. China adds additional power every year by the same amount which Spain consumes in a year. Let us take semiconductors. They have a goal to meet 70% of their own needs locally by 2025. In April 2018, when America decided to ban ZTE, Xi
with land and tax subsidies.
8
In power, their installed capacity is
Jinping arranged a meeting with his industry leaders within a month—in May 2018 itself. They have 139,000 kms of railway lines; almost double that of India’s. They executed the Qinghai to Tibet train project covering 1400 kilometres –with 1000 metres of the stretch set up at altitudes of more than 4,000 meters, overcoming lots of challenges and yet, completing it one year early! Then they set up a train system
The people want to be safe and respected. They are a collective lot and do not stand up as individuals. They work as a team. They look up to the government, and the government unites them.
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through Kazakhstan and Kyrgyzstan to
are very important part of the Chinese
from USA. Once China decided to
Europe, and it is functional. A lot of my
system. They have labour incentives.
embrace the world, USA decided to
produce is going by train from China to
The workers and staff have a lot of
embrace China and trade was going to
Germany and Spain now.
respect. Among the business units
be a big opportunity. For instance, the
Recently China had the foresight to
within an enterprise, there are profit
entire city of Chongqing is modelled on
seize the opportunity to set up the Tesla
centres and profit sharing. The unions
Chicago. Everything is big like
Gigafactory. It took them just 18 months
are generally passive. They don’t believe
McDonald and Kentucky. They like the
to
to
in gossip but only work. The
big scale concept. The banks favour the
commissioning and start of production.
government does a good job on skill
bigger and stronger companies.
This is an entirely American investment
development using many vocational
Let's take the example of Midea and
project. They were able to change their
training schools. People are getting
Galanz, two Chinese home appliance
mind and did not wrangle about the
more tech savvy. In the global
companies. Midea makes washing
factory being halfChinese and half
Innovation Index, they are at 14,
machines and Galanz, vacuum cleaners.
American.
Vietnam at 42 and India is at 48.
They reached the peak in that category,
go
from
land
approval
When we decided to go in for 3D
then Midea decided to make vacuum
They are agile and think in very
designing, we invested in two licenses
cleaners and Galanz decided to make
innovative ways
for India, 2 for China office and 2 for
washing machines. They just went with
They develop ecosystems in clusters. We
Vietnam office. But one of my Chinese
the proposal, got their approvals and
also have clusters in India, like Tiruppur
suppliers called Ningbo Kashion bought
loans and got into production.
and Surat in the textile industry. When
50 licenses! That is the way they go
we talk of Chinese clusters, they have
The Canton Fair is an amazing fair
with muscle, scale and power. The
the
and
held in Guangdong. It is held two times
government and banks support them.
ecosystem of all the vendors and all the
a year, in three phases because of the
They are agile and think in very
subassemblies available around. So this
number of products they have to cover.
innovative ways.
It is a place where businesses get really
complete
infrastructure
is the difference. The government
My garment sample room in
transacted and huge orders are closed.
Hangzhou make samples in about six
I went in and walked around Canton
working days and we courier it out to
Fair for the first time. I went to a booth
Zara in Spain. What did my Chinese
and picked up a garment. I looked at it
To cite an example, in January
competitor do? He moved his sample
and made some remarks. The next day,
2005, the global textile quota was about
room to Spain, just outside Zara. I could
I was back in my office and I saw that
to be abolished, and the world was going
not beat him on that. These are some
the same product which I had seen in
to become a level playing field and
interesting things our competitors do
the fair was sent to me. I did not ask for
China was expected to boom. Around
and we learn from them.
it. This is their initiative. They know
provides a lot of incentives by means of tax rebates. In India, we call them as duty drawback.
February 2005, the Indian government
how to promote and develop business!
withdrew duty drawbacks! These kinds
When it comes to thinking of business
of signals can often be very confusing to
development…
the industry. Speed, agility and support
The inspiration for size came to them
9
OCTOBER 2020
For those who cannot go to Canton Fair, there are places like the Shanghai
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Mart which is a 365 daysayear
one with 100,000 pieces capaciThey
anomalies exist and one keeps
exhibition. It is one huge mall where
always get the benefit of doubt due to
wondering how they manage to do that.
suppliers from all over China have their
their scale.
Subcontract is a way of life. They
stalls, all the time. There is the Yiwu City
They have already gone ahead to
don't think anything wrong about it.
consumer product wholesale market. It
develop base line on the electric vehicle
They take it for granted. They don't
is an amazing place and a Disneyland for
batteries. Two of their companies are in
always ask for permission. Subcontract
the consumer products business. There
the top five–CATL and BYD. A number
is something you have to live with if
are huge malls all around the city—one
of other Korean and Japanese
you're producing or sourcing from
mall is only for stuffed toys, one for
companies are also producing in China.
China. The factories are profit centres
footwear, and one for household plastics
I believe they struggle in a couple of areas. They have a culture of cost‐ cutting in the factories and there is a rampant problem of counterfeiting
and they decide whether to do inhouse Of the 'counterfeit’ mindset &
or subcontract. They think it is cheaper
subcontracting
to buy outside. This is not only for
I believe they struggle in a couple of
apparel but many other engineering
areas. They have a culture of cost
industries too.
cutting in the factories and there is a rampant problem of counterfeiting.
The mysterious ‘shadow factories’ &
There is also a problem which some
the 'third shift'
people call as ‘quality fade’. The quality
There are ‘shadow factories’ in China.
of products starts declining over a
They project at the front a factory as the
period of time. One has to patrol a lot to
face to the client and behind them are
achieve the quality standard. This I
other factories, which don't always
and so on. You can go there and buy one
believe is because of their mindset of
follow all the compliances and laws of
piece or 600,000 pieces. That is how
frugality. They believe that one should
the land.
they
not spend too much and they look if
When faced with quotas or
something can be cut down to a cheaper
restrictions on the amount of export
level. Not always do they take approvals
from China, they wriggle out by moving
and permission for that change!
the goods to Singapore, Cambodia or
think
of
their
business
development. In terms of capacity and delivery, the factories are so large. To traverse from Line No.1 to Line No. 20 of a T
The counterfeit business is also
Dubai, repack, redocument and re
Shirt factory, we need golf carts! Why
because of their mindset. They feel,
export. Then, we have the famous
does scale and size matter? Let's take a
“Why should only some people have
China's third shift philosophy. If they
customer like Uniqlo. They have got an
Louis Vuitton bags?” They go around
get an order for Hugo Boss shirts, in two
order for 100,000 pieces. They know
copying Louis Vuitton because that
shifts, they will make Hugo Boss and, in
that things may go wrong in the pre
doesn't need any marketing. They have
the third shift, they will make a precise
production or planning. When it comes
Land Wind car which is a direct copy of
copy and these will be sold in other
to the crunch, who will catch up with the
a Range Rover. It was launched almost
outlets. Where they falter are in the
delivery faster? The factory with 1000
at the same time when the Range Rover
areas of product integrity. German
pieces per day capacity in India or the
was launched. These interesting
engineers from Bosch once walked OCTOBER 2020
10
Business Mandate fountainhead of excellence
around a factory in China looking at the
humanely acceptable or not? I raised the
Partnership (CPTPP) with Canada and
ball bearings. They were so experienced
question to ETI (Ethical Trading
Australia has come through. Free trade
and by the handfeel of the bearings
Initiative) in the UK and they said, “No,
agreements are very important to boost
found out that something was wrong.
Sorry. We cannot approve and you
the business.
When questioned, the supervisor
better pull back.”
We have to benchmark and improve
scratched his head and said that they are
China is often blamed for ‘dumping’
our ease of doing business. All the
made in another factory. The infant
because of their mass production. One
parameters on ease of doing business
milk powder case was very famous. The
has to be very careful about IP issues
are very relevant and directly contribute
milk powder had melamine plastic
with them.
to the growth of Indian industry. We
components which were added to
should partner with Taiwan and
increase the protein content of the
Can India do a China?
Singapore for electronics to move away
powder. It does not just happen by
Can India become as big as China? They
from our dependence on China. We
default; it has something to do with the
started reforms in 1978 and we in 1991.
import about 66% of our electronic
culture.
We are now at $3.2 Trillion GDP and
products from China.
I had placed an order for shirts and
they are $14 trillion. 15 years back,
when I went for inspection, nothing was
China was at 3 trillion. So we are 15
going on in the factory. When asked
years behind them. As time progresses,
about my order, they said they are made
maybe we will ramp up. It is not about
in another place called Anhui. At Anhui,
trying to be as big as China but trying to
I saw that every house in a village was
have our own position in global
making my shirts!
business. I feel that we must give economy the primacy and which I
We should take Koreans and Japanese as our mentors. Wherever the Koreans and Japanese have gone, they have developed the industries very well. Japanese bring in the quality angle while Koreans bring discipline into business. We have to make worldclass quality and execution our brand!
Jianyu Gongchang and the question
believe is not being given. We should
of ethics
cast a vision for 2047, when our country
We have to set a time plan for self
My Quality Controller once went to a
will be 100 years old. We should be
reliance. We can't say that we will stop
factory for inspection. They replied that
forwardlooking. Our policy should not
importing from China from tomorrow.
the job had been subcontracted. As my
be two steps forward and one step
We have to sharpen the saw in terms of
QC insisted on inspection, with a lot of
backward. Government should try to lay
skills, competencies and logistics
reluctance, he was taken to a state
the carpets out, offer incentives, remove
infrastructure. We should try to develop
prison. Their state prisons referred to as
the barriers, lower operating costs and
Northeast India where there is a lot of
Jianyu Gongchang have a lot of
try to make the factories thrive. We
potential. That will also help us in
workshops not only for tailoring but
should pitch for FTAs like Vietnam.
keeping these states closely bonded with
also engineering and other industries.
Vietnam was working on free trade
us. We have to maintain our software
My QC brought back samples. They
agreements with USA and Europe. Their
asaservice (SaaS) leadership and Start
were pretty good. But something
Europe FTA has come through. Their
up leadership. We have to be assertive.
bothered me.
Comprehensive
Progressive
We should try to be a little more
TransPacific
powerful. Chinese people respect that.
Is prison factory production 11
OCTOBER 2020
Agreement
and for
Business Mandate fountainhead of excellence
China's rise was not limited to just export oriented factories and shiny new physical in‐ frastructure. It made startling shifts in power relations too. sprees of Western Nations including Spain where I am sitting right now. During the seven years that I spent in China, I worked in three capacities —initially as a teacher; I was teaching news writing in English. Subsequently, I was an advisor to the CII. Overlapping with that, I worked as a journalist, eventually becoming the China Bureau Chief for The Hindu newspaper. At that time, I was the only Chinese speaking Indian foreign correspondent based in China, which I always found amazing, considering that together we
I had written a lot about the challenges
2009 and this was really an epochal
of Indian businesses and also tried to
time in the country's opening up. China
unpack the complex reasons behind
had just joined the World Trade
China’s success in driving itself and
Organization in 2001 and Beijing had
transforming itself from a bit of an
won the bid to host the 2008 Olympic
Although Indians remain obsessed
agricultural backwater into the kind of
Games. So there was really a kind of
with China, there was very little
manufacturing
visceral energy that was palpable across
investment in trying to understand or
the country in those years.
learn about it as evidenced by the fact
and
infrastructure
superpower that it has become. I have often said that the Yiwu City Market was more spectacular and amazing and jawdropping than the Forbidden City.
China's rise was not limited to just export oriented factories and the kind of shiny new physical infrastructure
At least 90% of the world's
either, indicating one of the most
Christmas trees and ornaments were
startling shifts in power relations.
being manufactured in and around
Beijing had also begun to emerge as the
Yiwu and being sold there. Similarly
globe's chief creditor and it had
80% of the world's zips and buttons,
accumulated the world's largest foreign
plush toys, even Ganesha and Krishna
currency reserves. Particularly after
statues were made there.
2008,
I lived in China between 2002 and 12
OCTOBER 2020
formed a third of the world's population and were very important part of the geostrategic picture.
that there were so few journalists stationed over there. When I moved to China in 2002, like most Indians, I knew very little about it. There had been a long diplomatic freeze between the countries and there were no direct flights. Between 2002 and 2008, the growth was really exponential. My first impressions of the country
financing
were about scale. The size really hits you
powerhouse, financing the spending
—the roads and the buildings. This was
it
became
a
Business Mandate fountainhead of excellence
not only true of modern China but true
itinerant vendors that would pass by
nothing at all that we could learn from
throughout the history of China. For
there. People addressed each other in
them. I travelled the length and breadth
example, the Forbidden City was huge.
familial terms just as they do in India.
of China and visited about 25 Chinese
We saw it replicated during the
When quizzed on their perception of
provinces during the years I lived over
Communist period as well. They relied
India, they would talk of India as a
there. I went looking for poverty and
on this kind of gargantuanism with size
Buddhist country.
was taken to a village in Ningxia, which
and heft as a symbol of authority. It has
A certain demographic people had
is one of the poorest provinces in China.
translated into the modern and
been watching Hindi movies that were
I met two old couples who were
contemporary times too.
massive hits from the 1950s and 60s
supposed to be really poor. They lived in
through to the 1980s. They would even
a room, had a motor cycle, fans and a
dance to the songs from the movie
refrigerator. Looking at the consumer
‘Awaara.’
products definitions in India, they were
The rhythm in Hutongs As I lived in the city and learned Chinese, I ended up living a very local
very firmly middle class. This was
life. Unlike a lot of expats, I did not live
Some would comment on our
in the suburbs. I lived in the Hutongs
population and suggest that we should
(narrow lane in Beijing) and spent a lot
have ‘onechild’ policy. Once I asked an
of time with the workingclass Chinese
old bicycle repairman for his views on
Prelude to Covid‐19
people. I learned quite soon that a lot of
India. He didn’t open. After a lot of
I began my reporting career writing
the stereotypes we had about the
prodding, he said that India’s telecom
about a strange new virus that had
Chinese as being inscrutable, unfriendly
policy is quite advanced, people have
begun over the winter of 2002 and
and inhospitable were completely
choice in choosing the operator and the
which the Chinese government was
wrong. They laughed readily, had a great
tariffs are low. I was blown away by that
covering up. That was a novel kind of
sense of humour and were very much
—the fact that this guy had that kind of
corona virus. That's how I began my
into teasing people and teasing me as an
knowledge, but I think it was also a
China journey and we seem to have
Indian as well.
reflection of the broadening out of
come full circle today!
They were rustic and easy to approach. Like in India, people
coverage that they were getting about India.
supposed to be like the deepest poverty that you could find in a village in China!
I think that China has learned a lot of lessons from 20022003 in managing
welcomed you very effortlessly into their
In India too, we had very little
the present outbreak. South Korea,
homes. Lower down the socioeconomic
knowledge about China and when I
Japan, Taiwan and Vietnam have been
order, people were more open.
asked the reverse question in India, I
relatively successful in how they have
would get the full spectrum between
handled the corona virus as opposed to
Pride and Prejudice.
Europe. We can trace the epochal
If you took a bus into the countryside, people would share their eggs and oranges and nuts with you just
There were people who either
change after Xi Jinping came to power
like people would, on a train in India.
believed everything was so amazing in
in 2011 2012.The China of today and
There was a sort of rhythm of everyday
China and we should emulate it in every
the trajectory it has taken is quite
life in the hutongs. That was again very
way or people who thought that China
different from the one I would have
familiar to an Indian. You had one to ten
was the biggest enemy and there was
predicted 10 years ago. OCTOBER 2020
13
Business Mandate fountainhead of excellence
The ‘mandate of heaven’ also shares the platform with other philosophies and values of China... This is the basis of the underlying belief system of the Chinese people.
Professor Vijay Govindarajan. This flagship program is offered for about five large US based multinational companies and one British company, which is RollsRoyce. I started picking up a liking for China. I could connect a lot of dots from the past to the present. Incidentally, ethnography is my speciality and that's the reason why Tuck School absorbed me into their programs. I started seeing different aspects of China, largely from I am primarily an educator. I used to
of the ancient travellers of China came
run Indology programs for American
to India and vice versa; and these were
and British based museums and also for
so compelling on me. I decided to go to
educators who teach about India. I had
China. In 2008, I landed in Beijing.
this big apathy for China like most Indians. I had one long stint in the Nalanda archaeological site in Bihar. My guide, an elderly person, always used to tell me that I should see the beautiful Chinese Museum which was being constructed by the Chinese. The map that led to China
I was there for a BMW foundation and a CII meeting. Then I took off and I spent about a couple of weeks in the region of Zhengzhou. That is where I could really learn about China’s glorious past, the Chinese people and their backgrounds, cultural moorings and why they think the way they think today.
an American lens, but also from working on developing leaders who were yelling in pain about doing business in China. I also went through the transition of China with Xi Jinping coming in and the metamorphosis of China happening. Experiential learning was my specialty. My job involves taking people and putting them for half a day in a small little Communist Party office in a village, then bringing them out and having conversations with them.
One fine day, he took me to the Chinese
I went all the way to Kashgar which
Museum and what struck me was the
is in the extreme west of China. I
What I learned is that in China, there is
huge map of China. I looked at the
travelled extensively and that was my
a deal between the rulers and the
Xinjiang province in the West of China
passion. From 2005, I have been
subjects. This deal was made some time
and thought about the connection
running a Global Leadership 2030
in 600 BC. It is known as the ‘Mandate
between India and China through the
Program for the Tuck Executive
of Heaven.’ They don't necessarily
West, the pathways through which some
Education in which I am a partner of
believe in gods and goddesses, but they
14
OCTOBER 2020
The deal
Business Mandate fountainhead of excellence
do have a notion of a heaven.
emperor is gone and the rebel hero
authoritarian rule. It is not a
Metaphorically, let us assume that the
becomes a new emperor, a new dynasty
dictatorship as when Mao Zedong ruled.
heaven is like the ocean and the earth is
starts off and people follow the new
Subsequently, there have been a series
the only ship in the ocean. The emperor
dynasty.
of wellplanned successions in China,
has the mandate of the heaven to steer
This cycle has been going on. The
which do not exist in any other
the ship in a way that there is harmony
last cycle in China was broken in the
communist country. Xi Jinping has
at all times.
‘century of humiliation’ as Chinese call
taken that away. As long as he is
Then there are subjects in the ship
it, when westerners for the very first
winning, one cannot argue. It is also
and their responsibility is to serve the
time came into China and ruled for
very difficult to say that the people have
emperor and follow him. This deal has
about 100 years. For Chinese, it is all
not given him the mandate. Of course,
helped China sail in the past. The
right, if the problem is within China.
there is unrest going on in Hong Kong.
‘mandate of the heaven’ says that
Now the Chinese Communist Party
subjects have the rights to rebel but they
(CCP) has this deal with the people of
better be sure because the emperor's axe
China is a country which believes in
China. The ‘mandate of heaven’ also
could fall on their neck. It also tells the
meritocracy, which is very important for
shares the platform with other
emperor that it is his responsibility to
them. This is not imposed by the
philosophies and values of China, like
lead in righteousness and if he does not
government or Chinese Communist
the Confucian and Taoist values. This is
deliver, there's going to be a rebellion.
Party. Meritocracy is something which
the basis of the underlying belief system
came to China way back from the 12th
of the Chinese people.
century.
The ‘mandate of the heaven’ also
Merit all the way
tells that from time to time the heaven
China is an authoritarian state, but
will give clues to the people when
You need to very good. You need to
that doesn't mean that the people are
righteousness is being defiled. Those
have excelled in school not only in your
unhappy there. People are proud of their
clues are diseases, earthquakes, natural
studies, but also in games and extra
culture and they have managed to
calamities and foreign enemies ganging
curricular activities. Then you get a
maintain this heritage in all these years.
up and trying to break the fort and come
ticket to the Communist party. You are
With this as a mooring, you can drop
into the country. This might sound very
judged and rated as you pass out from
down to presentday China.
school, college and in the party affairs.
much like a fantasy, but this has been in
Xi Jinping has a vision that no
Only if you are good in all these things,
other country has in the world today.
you can climb up the party ladder. You
In China, there were many
His vision is to deliver China as the
can imagine the people who are sitting
dynasties which came up and went
number one country in the world. That
right on top in the politburo of China
down. Every time a dynasty came up, it
vision is backed with the traditional
—the seven member committee who are
was because there was a rebellion. It
Chinese values. This is the single most
reporting to Xi Jinping. They are highly
starts from the intellectual circles. There
important differentiator between China
qualified and very capable people who
are wise people who start voicing up and
and any other country and it percolates
have risen up the ranks.
eventually there are people who take up
down into everything else.
vogue in China.
arms. When the civil war ends, the
15
OCTOBER 2020
China
is
a
bureaucratic,
If as a CEO of a company, you end up in one of the cities in China
Business Mandate fountainhead of excellence
discussing with a local Communist Party
vision of saying that they had to come
When we talk about freedom, there
office about doing a joint venture with
out of the ‘century of humiliation’ and
are three kinds—the personal freedom,
the semiconductor factory in China, you
become the best. The roles were very
political
better be sure that the person sitting
clear; the commitment to the party and
freedom. Soviet Union and most of the
there is amongst the best CEOs in the
to the Communist Party Chief was also
Communist Bloc countries started with
semiconductor industry.
clear. But the mission was all a series of
political freedom, which is not possible
experiments.
without personal freedom. Then they
There is no inheritance in China. What I mean is that in India, we had a legacy from the British. They left us a ‘workinprogress’ sort of administrative system. But for China, there was nothing like that. When they got the country, it was a clean slate development. They had to learn everything. So they had this grand
freedom
and
economic
allowed markets to take care of Decentralised China 85% of the total spend of China is done by the local governments. The central government or the federal government spends only about 15%. Even in the most developed economies, the rate would be something like 5050 at best.
economic freedom. Most of them failed, or so say most authors. In China, they never gave personal freedom and political freedom. The freedom they gave is economic freedom. And, this is the kind of a competitor we are actually up against.
The ‘mandate of heaven’ also shares the platform with other philosophies and values of China... This is the basis of the underlying belief system of the Chinese people. recruited a number of Chinese staff and sales managers. We supplied fabric to a number
of
Chinese
garment
manufacturers who used to ship the garments over to USA and Europe. Coming to the Chinese staff, one of the most important aspects that I noticed was their total focus on quality and productivity. Compared to an Indian staff member, they were not as quick in grasping things. They took a lot more time and needed handholding. I will share my experience working with
two decades back and one more recently
Chinese people, competing with and
between 2015 and 2018. I set up from
supplying to Chinese companies. My
scratch the AsiaPacific regional office
experience is in two parts—one is about
for Arvind Mills in Hong Kong. I
16
OCTOBER 2020
But once they understood the process and requirements, they could do the same thing again and again. I could close my eyes and trust my staff with the shipping documents, bank documents,
Business Mandate fountainhead of excellence
invoices and any operational aspects.
would deliver something to the
they would work very hard to learn
There would be absolutely no fault.
customer, they would do it. One of my
English so that their teacher need not
Their productivity was two to three
biggest challenges in leading the team
lose her face.
times what I used to observe back in
of sales personnel was to be able to
With respect to competition, they
India.
make sure that the backend team in
do not have a profit motive but market
India meant what they had committed Face value
share is very important. They work
to the customer. It was a hard time
The second important aspect I noticed
backwards from the selling price while
retaining the sales people because they
is a basic philosophy in China called the
we normally work on cost plus profit
would not want to lose face with the
‘face concept’. What it means is that: “I
model. Therefore, competing with
customers. If once or twice the
cannot lose my face in front of either a
Chinese in manufacturing is especially
deliveries got delayed, they would just
customer or somebody superior.” They
very difficult.
leave the company. This was their
will go to any level to make sure that
mindset.
their ‘face’ is protected.
Chinese customers expect us to be extremely agile and nimble. The
My wife worked as a teacher in
I noticed this very strongly with my
commitment made to them should be
Hong Kong teaching English to Chinese
sales team. If they promised that they
met and they follow up closely. Promises
school children. They used to say that
must be delivered, come what may.
OCTOBER 2020
17
What should we do to attract Apple and Samsung to India? Mr Venky Nagan: When I drive down in Hanoi and go past the Samsung factory, I find it humongous. It is really a giant factory that provides employment to around 20,000
Will the supply chain move away from China?
people. The question is—will our policies change every few
What is the impact of an adverse USChina
years?
relation?
Mr Balaraman, Past President, MMA: Mahesh told
Mr Venky: Many are scared by the tensions in USChina
me that in China, the government makes sure that the entire
relationship. But they feel that things can change in
value chain is competitive.
November. So they adopt a wait and watch approach. They
Mr Mahesh: In China, the entire value network is important. They are into many fields—Electronics, PCBs,
look at other options but after going through all the pros and cons, they still find China as the best option.
Semiconductors, Wafers, Fablabs and so on. They probably
Ms Pallavi: There has been thinking in China in
don’t have raw materials. In India, we can only get contract
preparation for this scenario. They may challenge the entire
manufacturers like Foxconn to set up shops. The
world. Whether they have miscalculated their strength or
government gives incentives and capital subsidy. As
not, will be known only in the next few years.
components are not made here, China can possibly create
How do you view the strength of India’s history of
roadblocks in our getting the components.
democracy versus China’s authoritarian rule?
Due to the failure of globalisation, many companies that
Ms Pallavi: India has a safety valve in democracy. In
have established their entire value chain in China feel they
China, things can change only by revolution. There is no
are stuck. Now, if we go on an audacious scale by having the
question mark on the future of India as a country. Transition
entire value chain here, countries will not want to risk now.
of power can be China’s Achilles heel. But I don’t think there
For them, it will be shifting the problem from China to India.
will be a revolution in the near future. They have developed
Maybe, we should tie up with other countries like Malaysia
domestic markets. They say that the Communist Party is an
and Singapore so that we can assure the big players that they
elephant riding a bicycle. An economic slowdown can be a
are not putting all their eggs in one basket. Because of the
serious challenge for them.
trade war between US and China, many companies who have set up their factories in China are anxious. They begin to realise that they have to work with pockets of excellence like India in spite of changing governments and policy issues. Ms Pallavi: Countries like Japan want to diversify away from China but they do not prefer India. They prefer Vietnam or even Bangladesh. This is because of the policy changes in India. For India to emerge as an alternative, they have to convince the manufacturers a lot but I think it is difficult.
Mr Balaraman: I know that many Chinese workers have lost their jobs in the recent slowdown and they are moving to their villages. There are huge empty buildings in the cities. Mr Mahesh: Xi Jinping and the Communist Party have promised to deliver to their people. The people of China do not know what is happening in the world other than what is told to them by the Chinese media. So, there may not be a major shift in the near future.
M S NARAYAN
are ads on TV and even reminder letters.
value of future benefit in favour of
They send this kit out once every two
immediate gratification. In the same
years. It takes maybe 10 to 15 minutes
way, we intend to join the gym but it is
ecent insights into how
to take this free test. Yet, for the last 10
always something we will do tomorrow
people think impact all of us.
years, I have put these kits aside, fully
—and tomorrow never comes.
Governments
and
intending to, yet never actually getting
organisations use these insights to push
around to do the test. I am not alone
Jumping to conclusions
us to certain decisions, often for our
—58% of Australians don’t send the test
If you are asked the following question:
benefit and perhaps, sometimes, not
kit back. Why don’t sensible people do
A bat and ball together cost $1.10. The
with our best interests at heart. M S
sensible things that could potentially
bat costs $1.00 more than the ball. How
Narayan, Principal AdvisorGateway,
save their lives?
much does the ball cost?
R
Sydney, Australia, explores the factors at play in “Think, Think, Nudge, Nudge,” a talk organized under the Pond’s veteran series at MMA. When you turn 50 in Australia, you get a bowel cancer test kit, free of cost, from the government. The kit comes with a letter that says, “Every week, 80 Australians die of bowel cancer. With early detection, 90% of bowel cancers can be successfully treated.” And there
Many of us jump to the conclusion Dessert choices
that the ball costs 10 cents—and we are
If you were deciding next week’s dessert
not alone. Around half of Princeton
today, would you choose chocolate or
graduates gave this (wrong) answer
fruit? 74% people opted for fruit in a test
when this test was run. If this question
that was run in 1998 (Read and van
were to be asked in a Class X exam,
Leeuwen). But when the same question
students would have given the correct
was tweaked and asked: If you were
answer as 5 cents. But when asked
deciding tonight’s dessert, would you
outside of a formal test, many people
choose chocolate or fruit? Most people
instinctively jump to an answer. We go
opted for chocolate. Clearly, we know
for the simple, obvious choices.
what is good for us. But we discount the
Business Mandate fountainhead of excellence
Leveraging the understanding of human behaviour If we can recognise human behavioural patterns, we may be able to develop highly adaptive and effective programs, and find ways to overcome our cognitive limitations. This knowledge can be of great value to designers of public policy, such
as
me.
It
requires
an
understanding of some of the theoretical frameworks that acknowledge that people are not always rational and recognize what possibly can be done to Understanding how people behave is
Professor at the University of Chicago,
key
won the Infosys Prize in 2018). In this
Policy makers need to understand how
book, the authors looked at how our
Not always the best choice
people actually behave, which is not
mental capacities are consumed by
In 1738, Daniel Bernoulli hypothesised
always rational. For example, our
conflicting demands. They tested the IQ
that people maximise utility in making
behaviour is not directed towards an
of farmers in India before and after
choices. For 200 years, this was taken
objective
overcome this failing.
but
our
harvest and found that IQ was
as a ‘given’ by economists. Then in the
representation
or
significantly lower preharvest (when
1950s, Herbert Simon, who was to win
construct of the world. We may be afraid
they were cash strapped) than post
the Nobel Prize in Economics many
of flying, even though objectively it is
harvest. Similarly, in the UK, a group of
years later, argued that people do not
the safest mode of transport. We also
people were told that they had to spend
necessarily maximise utility because of
overestimate our mental capacities or
1000 Pounds on car repairs the next
limitations in knowledge, social and
bandwidth. When we text or answer the
day. Just contemplating this expense
personal connections. They are often
phone while driving, even if it is hands
resulted in a 1314 point drop in IQ
happy with less than optimum solutions
free, our peripheral vision and reaction
—almost as if they had stayed awake all
—i.e., finding an acceptable solution
time are affected as much as if we were
night.
even if it doesn’t maximise benefits.
real
idiosyncratic
world
legally intoxicated.
Thinking about the fact that we may or may not have money affects our
Scarcity affects mental capacity
mental capacity and decision making. It
In the 2013 book called ‘Scarcity: Why Having Too Little Means So Much,’ Mullainathan and Shafique came to some
stunning
conclusions.
(Incidentally, Prof Mullainathan, now a 21
OCTOBER 2020
Simon introduced economists to terms such as “bounded rationality” and “satisficing”.
may be that people are not poor because
Cass R Sunstein and Richard H
they make foolish choices; rather, it may
Thaler wrote an article in The New
be poverty that consumes mental
Yorker, (Dec 2016) titled, ‘The two
resources and leads people to make bad
friends who changed how we think
choices.
about how we think.’ They were
Business Mandate fountainhead of excellence
When dealing with complex
think irrationally. If we can identify the
Amos Tversky who published a paper in
problems,
use
patterns in which people think
1979 which disrupted the world of
heuristics or mental shortcuts
irrationally, then we can design choices
referring to Daniel Kahneman and
Economics by outlining what they called Prospect Theory. According to this theory: •
people
to transform complex matters into simpler ones, to make decisions. Daniel Kahneman won the Nobel
Losses mean more than gains.
better decisions.
the very popular best seller, ‘Thinking
principles. For example, nudging was
Fast and Slow’, which many people
never to be about compulsion, reducing
would have read. His 38 minute Nobel
freedom of choice or significantly
People make decisions based
Prize acceptance speech is well worth
changing economic incentives. It was
on the potential value of losses
listening to.
not about forcing people to do
than the joy we get from gaining $20.
something they didn’t want to do.
and gains rather than the final Nudge Theory
Instead, nudges should be easy to avoid.
matter
Richard H Thaler and Cass R Sunstein
The theory was put forward as an ethical
—people care more about
wrote the bestselling book, “Nudge,” in
way of simply helping people to make
2008. They took Kahneman and
better decisions, for their good, by using
Tversky’s concepts and built on them,
knowledge of the mental shortcuts or
packaging them attractively and
heuristics that people use to make
accessibly.
decisions.
outcome. Reference
points
what they gain or lose depending on what they start with •
understanding and help them make
The theory established some
get from losing $20 is greater
•
that will take advantage of this
Prize for Economics in 2002. He wrote
This means that the pain we
•
•
People tend to underestimate high
probabilities
and
See
some
examples
small
The idea behind Nudge Theory is
comparing Traditional and Nudge
probabilities. If something has
that people can be “nudged” to think
approaches to addressing an issue in the
properly and make better choices by
table on this page. The authors called
offering them choices that are designed
nudge theory ‘Libertarian Paternalism.’
to help them do so. We know that people
Of course, while there was a degree of
overestimate only
1%
chance
of
a
happening, people think that it has a 5 to 10% chance and they behave accordingly.
Some examples comparing Traditional and Nudge approaches to addressing an issue
OCTOBER 2020
22
Business Mandate fountainhead of excellence
•
Loss aversion
•
Selfcontrol strategies
•
Availability
•
Spotlight effect
•
Optimism/overconfidence
•
Temptation
•
Priming
•
Conforming/following
the
herd •
Language and signage design
There are, of course, others. Growing global interest David Cameron, former Prime Minister of England, after reading ‘Nudge,’ reportedly became a fan of the book. He set up a ‘Behavioural Insights Team (BIT)’ aka ‘Nudge Unit’ in 2010 with an annual budget of GBP 500,000. The BIT team was challenged to produce a ten fold return on operating cost in two years, failing which the unit would be shut down. The team coopted Richard Thaler (2017 Nobel Prize winner in Economic Sciences and coauthor of Nudge Theory) to be an advisor and saved 22 times its running costs. This success led to BITs being formed in many countries. Google searches on ‘Nudge Theory’ continue to paternalism, it was still consciously
that has not always been the case, as we
about preserving liberty and allowing
shall see later.
grow year after year, which shows the ongoing interest in these ideas. In 2017, OECD published 100 case
people to make their own choices. In their construct, ‘nudge theory’ was
Common mental short cuts
studies from 202 countries across the
aimed at making the community better,
In addition to the examples of anchoring
world highlighting success stories from
not a mechanism for commercial
and status quo discussed above, there
the BITs. In 2018, the World Bank
exploitation
are many other such heuristics or
published a study on Behavioural
mental shortcuts, including:
Development Economics identifying
or
government
manipulation. In practice, of course, 23
OCTOBER 2020
Business Mandate fountainhead of excellence
global leaders in this area.
.... the experiment ran for just five weeks, and cost very little. And just changing around 15 words on a web page ended up potentially saving many lives.
Success stories from around the world In the UK, the BIT team increased tax receipts by 200 million Pounds a year. They achieved this by sending an initial letter to the defaulter saying something along the lines of, “90% of the people
just changing around 15 words on a web
road, people were nudged to
have paid their tax on time. We note
page ended up potentially saving many
stay in their lane.
that you have not. Can you please pay by
lives.
•
The ‘Keep Singapore Clean’ campaign is another example
this date?” Many responded. Another
In Tokyo train stations, there was
letter said “Nine out of ten people in
reportedly an 84% reduction in suicide
your local area pay their tax on time.
Government nudging people
attempts when they installed ‘Blue’ LED
to do the right thing using
You are in the minority…”And so, with
lights above train station platforms, a
publicity, and social pressure.
a series of letters, they nudged people to
lowcost alternative to sliding barriers.
“follow the herd”—and comply.
The blue lights reportedly have a
Enrolling organ donors was another
soothing effect on the mind. This idea
big success of the BIT in the UK. The
has since been adopted elsewhere in the
Nudge Unit was able to increase the
world too.
number of people registered as organ donors by 96,000 a year. How did they achieve this? The ‘Nudge unit’ created nine different versions of the landing page where people had to go to renew
•
the speed limit. In a 25 mph zone area, those who exceed
limit are eligible to go into a
Marking of lines on the road
lottery to win a share of the
to demarcate lanes and ensure
fines. The result: The average
lane discipline is an example
speed of vehicles in this site
of a ‘nudge.’ It is the single device in the world. There are
read, “Three people a day die because
many stories on how it came
there are not enough organ donors.”
into being. One story is that a
version, which was based on the
to nudge people into obeying
those who drive within this
slightly different wording. One version
If so, please help others.” This last
In Stockholm, ‘speed camera lottery’ signs were introduced
Here a nudge, there a nudge
most effective road safety
organ transplant, would you have one?
•
the speed limit are fined and
their car registrations. Each version had
Another version said, “If you needed an
of behaviour change by a
lady doctor in California, Dr Jane McCarroll who narrowly escaped being run over by a truck coming in the opposite direction,
decided
to
‘reciprocity’ heuristic, was the most
something
about
effective in getting people to agree to be
painted a line in the middle of
organ donors. The experiment ran for
the road herself. By artificially
just five weeks, and cost very little. And
reducing the width of the
it
do and
dropped from 32 mph to 25 mph. •
Smaller plates in a hotel buffet reduced food wastage by 22%
•
To reduce cigarette littering, a campaign was run themed, “Think inside the box. Vote with your cigarette butt. Who is the best player in the world – Ronaldo or Messi?” For each player, there was a box into which cigarette butts could be deposited to “vote”. This led to a 74% reduction in cigarette OCTOBER 2020
24
Business Mandate fountainhead of excellence
•
•
littering.
by taking the stairs is a nudge.
to charity. Compared to the first group,
Similar, fundriven, concepts
In another famous nudge, at
there was appreciable reduction in fuel
were devised to encourage
Odenplan
station
savings delivered by the second and
people to dispose of chewing
Stockholm,
stairs
gums in designated spaces
modified in such a way that
and waste in segregated
when people walked on the
“Lemonade,” a disruptor in the
boxes.
steps, musical note were
insurance industry in the US employs
In a behavioural test done in
produced. This led to a 66%
on its rolls a world leading behavioural
India on car drivers, a button
increase in the use of stairs.
economist as Chief Behavioural Officer.
was introduced to encourage a
Such musical stairs have
reduction in honking. Every
spread to Milan, Melbourne,
time a driver honked, a red
Istanbul, KL and Auckland.
light would flash and would
Fun can obviously change
keep flashing annoyingly until
behaviour.
manually switched off. There
•
were
third group.
Lemonade makes use of AI and behavioural insights. For example, when people are asked to fill a form, if they are asked to sign at the top rather than at the end, they are more likely to be
was a 61% reduction in
Nudges in business
honest in their declarations and less
indiscrete honking.
Virgin Atlantic was able to save 6828
likely to lie. Lemonade uses techniques
In Copenhagen, authorities
metric tons of fuel by nudging their
such as this. They are even referred by
provided waste bins and made
captains. A test was run by behavioural
them highly visible. They also
some as ‘The Tesla of the Insurance
scientists on pilots, who were divided
industry.” While this may be hype, they
into three groups. The first group was
are definitely a business to watch out
told that fuel consumption during the
for.
painted
green
coloured
footsteps that led to the waste bins, thus nudging people to use the bins and resulting in a •
in
trip would be monitored. The second
46% reduction in litter
group was given a target consumption
Nudging and marketing
Reminding people to use the
figure; the third group was given a
Marketers
steps instead of escalators by
target and told that if they beat the
unknowingly used nudges for years; for
painting the calories burned
target, a certain sum would be donated
example, by comparing in advertising
have
Fundamental differences between nudging and traditional marketing
25
OCTOBER 2020
knowingly
or
Business Mandate fountainhead of excellence
OCTOBER 2020
26
Business Mandate fountainhead of excellence
What next for Behavioural Insights
Nudging can also be used in ways that are not necessarily in people’s interest. For example, the UK proposed a new campaign—trying to get people back to work in offices rather than from home during the Covid 19 pandemic.
﴾BI﴿? •
innovation adoption suggests that there could be a trough after seeing a peak of positive results
credibility, trust and influence are all
subscription with the cost of a chocolate
important factors.
sundae; or the cost of an Ikea coffee maker with the cost of parking. Other examples are a service
and
inflated
expectations from BI. •
the daily cost of a newspaper
Gartner’s ‘Hype Cycle’ of
However, while in some countries
BI
units
have
harvested the low hanging fruit, there is still considerable
Also, one size does not fit all. A
scope in other countries to do
nudge that works in one context may
the same. At the same time, advanced BI units such as in
not succeed in another
Australia are working on
provider who offers different plans for
complex issues like gender
availing a service, identifies one of them
The dark side of nudge theory
as the most popular plan, thus
Nudging can also be used in ways that
anchoring and nudging people to make
are not necessarily in people’s interest.
that choice; and the use of price framing
For example, the UK proposed a new
scope for nudge techniques to
i.e., pricing at 599 rather than 600; or
campaign—trying to get people back to
be employed by governments
giving people a welcome gift for signing
work in offices rather than from home
and business.
up for a service. These are all nudges.
during the Covid 19 pandemic. The message says, in effect, “If you don’t go
Designing a nudge
back to work, the manager may forget
How do you design a nudge? It’s quite simple conceptually:
This was to counter the overwhelming
First: Frame the problem. Next: Design experiments and run randomised and controlled trials. Third: Interpret results. Finally: Implement
It is important to be trusted when nudging. People are more open to being nudged if they have positive feelings
27
the
nudger.
OCTOBER 2020
•
•
is: “Yes, every day and in many ways.” Are you aware of this? Are you happy to be nudged? •
Likeability,
you
designed
your
nudges? Have you considered behavioural
accounts and fake news in social media
very difficult to get out of.
Are you a nudger? If so, how have
negative content on people’s emotional
make it is easy to join or sign up and
Are you being nudged? The answer, if you think about it,
Facebook did clandestine tests in
encounter ‘sludge’ where organisations
There is still considerable
I leave you with these closing thoughts:
from home.
that constantly nudge us. Finally, we
domestic
Closing thoughts
preference of people to continue to work
India to see the impact of positive and
and
violence.
wellbeing. We are familiar with fake
Cautions and observations
toward
you and you might risk losing your job.”
inequality
insights
in
designing these nudges? •
Should you consider adding nudging to your tool kit?
PANELISTS
S
ection 135 of the Companies Act, 2013 along with the
•
Social business projects
Companies CSR Rules, 2014 makes it mandatory for
•
Contribution to Prime Minister’s Relief Fund and
mentioned under Sub Section 1 of Section 135 to comply with and these are: • •
•
Employment enhancing vocational skills
•
Contribution to technology incubators located within approved academic institutions
Companies with net worth of Rs 500 crores or
•
more;
These are similar to the 17 sustainable goals of the UN
Companies with turnover of Rs 1000 crores or more;
•
other such State and Central funds
certain companies who fulfill the criteria as
Companies with Net Profit of Rs 5 crore or more during any financial year.
These companies shall be required to constitute a CSR
Rural development projects.
and the ‘triple bottom line,’ which takes into account profit for the society and environment apart from profit to the company. Anu Oza: How did Boomika Trust respond to Covid?
committee of the Board. They shall ensure that at least 2%
Aruna: Floods and earthquakes are very frequent in India.
of the average net profit of three immediately preceding
The NGOs are the first responders in a disaster. We can split
financial years would be spent on CSR activities every year.
our action into three phases, which we call the 3Rs—Rescue
Activities allowed under CSR:
phase, Relief phase and Rehabilitation phase. The rescue
•
Promotion of education
phase is best left to experts. Civil society has rescued people
•
Eradication of extreme hunger and poverty
during Gujarat earthquake, Kerala floods and Chennai floods.
•
Gender equity and women empowerment
As an NGO, we manage rescue by helpline, geo tagging people
•
Reducing child mortality and improving maternal
and connecting them with the government.
health •
Combating disease
•
Environmental sustainability
All disasters are characterized by the need for food security. NGOs have a constraint as they receive project
Business Mandate fountainhead of excellence
migrant labour crisis followed. We created a project called, ‘Food First’ which included delivery of cooked food and rations. Even NGOs who were not tuned to do these activities stepped in, generating local funds. Over the last few years, the response of nonprofit organisations to crises has been exemplary. They have been able to identify the needs and ensure lastmile connectivity. In essence, though we didn’t understand the pandemic, our first response was in ensuring food security for
Over the last few years, the response of non‐profit organisations to crises has been exemplary. They have been able to identify the needs and ensure last‐mile connectivity.
the people and in supporting the Tamil Nadu government which did a great job by opening up the rations. Those who didn’t have ration cards were helped by the civil society and NGOs like us. Anu: So, in a crisis, we need to see
denominated funds and they are not free to use them for disaster relief. Because of their DNA to reach out, they cannot stay away from a disaster either. So NGOs take donations from civil society for natural disasters; some are able to get corporate donations. In the rehabilitation phase, only the government and some of the larger NGOs play a role while the others are not involved in this phase. Regarding Covid19, we were only reading about it and not seriously bothered. Only when our Prime Minister declared a lockdown on the night of March 24, we realised the magnitude of this crisis and disaster. It was difficult to hit the ground running because of the fear of infections. Normally disasters are geographyspecific and time specific, unlike Covid. We had to move straight to the relief
under which phase it falls into and respond. In any crisis, people need funds and food. Therefore NGOs need to be embedded in communities and they also need to partner with the government to see that people don’t go hungry. Can you give us some idea, from a corporate angle, how Covid funding and CSR funding are managed and share some of the key learnings? Shyam: Many companies distributed PPEs, sanitizers, ventilators, ICU beds, medical equipment and dry rations for migrant labour. Many reached out to migrant labour through food cooked in their company canteens. There were three broad approaches to funding by the companies: a)
budget were used. b)
mode. We initiated a helpline for senior citizens and this was supported by remote volunteers. The larger crisis broke out when the daily wage earners did not get paid and soon the
Provisions available in the company’s 20192020 Some of the companies created a special fund over and above the CSR funds for Covid.
c)
Others utilised the funds from the current year’s CSR budget. OCTOBER 2020
30
Business Mandate fountainhead of excellence
Many companies also contributed to the Prime Minister’s
5000 to 6000 people. That was their way of providing rescue
Relief fund—PM Cares. As per reports, Rs 15,000 crore is the
and relief by cooking. Medicines came sans frontiers. IBM
annual CSR spend with 3,000 crore coming from PSUs and
offered to come up with software to help people identify the
12,000 crore from the private sector. Of this, about 5000 to
dead, upload their details and perform the last rites. That is
6000 crores went to PM Cares. The rest were marked for the
the power of partnerships.
company’s CSR activities. With 25 to 30% CSR funds of
The 17th SDG (Sustainable Development Goals) of the
companies going to Covid relief, how do companies plan for
UN (United Nations) is about how we develop partnerships
other CSR activities during this year?
for the other 16 SDGs to happen. In the ‘Rescue’ phase, the
1)
The flagship CSR activities of companies are not significantly reduced.
2)
New projects and those that do not align with the
government has to take the lead. The Disaster Management (NDM) Act 2005 came into
companies’ vision for CSR will be under scrutiny.
being because of the 2004 Tsunami. The PM heads the
These will be either delayed or withdrawn.
Disaster Management Authority. The government provides
Anu: What is the reach of government and NGOs? How can
the structure for various organisations to collaborate and
we improve collaboration between the government and
without any of them feeling intimidated. Capacity building
NGOs?
is one of the objectives of NDM Act 2005. We lack seriously
Vivek: A government is a system, and like a rudder, it
in capacity and need to focus on this, going forward.
controls the movement of its various constituents. The
Anu: So, you have to go the extramile to be a partner even
government and nongovernmental organisations form a
if you are not necessarily seen as a partner. We need to build
dichotomy. It doesn’t need a crisis for them to come together
capacity working in tandem, right from the beginning
and collaborate. NGOs have a higher trust quotient compared
rather waiting for a disaster to strike, for everyone to pull
to some of the government organisations. I was
together. What kinds of capacities are needed in the short
commissionerincharge of Tsunami relief in Nagapattinam
term?
in 2004 after Tsunami struck on Dec 26 of that year. 6000
Shyam: Skilling is one area we need to focus on. For
people died in the area where I worked.
instance, healthcare frontline workers are now in great
It was a shocking sight then in Nagapattinam. When I
demand. We have to skill people for the right sectors that are
entered the town, I saw a vegetable vendor carrying three
needed to tackle the Covid crisis. Because of loss of livelihood,
dead children in his vegetable cart. We started with rescue,
many girl children will be denied the opportunity of getting
which was predominantly done by the government. Many of
higher education. The education programs have to be tweaked
the government staff had also lost their family members in
to support girl children. Healthcare infrastructure and
the tragedy. India’s concept of Vasudeva Kudumbam, i.e.,
implements like ventilators need attention. Similarly, electric
‘The world is one family,’ is something that we should be
crematoriums are the need of the hour. The existing CSR
proud of. A large convoy of trucks came from Punjab and all
projects have to be tweaked to factor in the current realities
that they asked for was space. I gave them a school which was
from Covid. Next is the use of digital in fields like education
not functioning. They had brought everything from Punjab
and medicine. Companies can leverage the existing public
right from cooking utensils and materials for dishes like
infrastructure and work together with the government. Some
masala, atta and even salt. Every day, they cooked food for
of the existing hospitals have to be made Covidready. One
31
OCTOBER 2020
Business Mandate fountainhead of excellence
project which can combine all the above is addressing child
We used our tech volunteers in this. We worked together with
malnutrition. Healthcare workers can be used to measure
the police. It was a very happy marriage. NGOs now have to
the weight of children using a weighing scale and track other
build on the trust gained during this crisis and the
parameters that reflect the health condition. They can feed
government also has to raise it veil. In the last few years, we
the data in an app. Data about the vulnerable population can
have not moved in the SDG ranking. Currently, NGO spend
come from the government.
is only 6% of the government spend. We have to cocreate
Aruna: Strategic partnership is very important. Between
projects. The corporates must think in terms of creating
the government and NGOs, there was a six degree separation.
‘Impact Funds’ instead of aiming for mere philanthropy. The
We have closed the gap to three degrees now. I am not sure
benefits must be 10X.
of the exact reason for this gap, if it is a trust deficit or a threat
Vivek: There is a significant linkage between growth and
perception. But that apart, we have had some brilliant
poverty. Because of growth, poverty has been reduced by half.
experiences in working with the government.
Rural poverty has come down from 50 to 25% and urban
We worked together with the government to reach out to the migrant labour in Thiruvallur district. We created
poverty from 31 to 14%. As there is a sharp decline in growth thanks to Covid, naturally it will impact poverty too.
larger ration kits that suited their kind of eating habits. The
The work, work place, work ethics and work force will
police have data on the migrants. We approached the district
play a defining role in the new normal. We need to build
SP. In less than 24 hours, he sent us data of migrant labour
capacities for the work that will be important in the new
in various zones under his control like where the clusters are;
normal. The work place has now changed dramatically with
and, which industries they were working for.
‘work from home’ (WFH) being adopted widely. What will
There were 18,000 of them. Thus we knew the
be the work force like, how much of automation will be there,
population that we were addressing. The SP also provided
what will be the work ethics? All these have to be identified.
space for our team to store and sort the materials. He brought
Many things existed even before Covid but we are utilising
us volunteers from police to support us and help us in
them now more. For instance, Zoom existed before Covid but
packing. The police team made it so seamless for us. They
we now use it extensively.
also provided us trucks to deliver the relief materials. They
Anu: Let me sum up what we have discussed so far. NGOs
stood shouldertoshoulder with our volunteers to see that
can use the understanding of the CSR Act and use certain
there was orderliness and that social distance was
immediate relief provisions; NGOs and Government can
maintained.
proactively take partnership stance right from the beginning.
The government has the foundation. NGOs have to step
Companies are likely to look at things like skilling in relevant
in with their empathy and they bring a different perspective
sectors; they now focus on Covid related programs in the
to the game. NGOs do not merely look at numbers of people
short term followed by their flagship programs. There are
for distributing materials but they consider in terms of
several examples of GovernmentNGO partnerships in many
empowering the people.
disaster situations and there is enormous potential for
We were able to pick up the phone and talk to several IAS officers. Again, when the labourers had to be sent home, GCC—Greater Chennai Corporation—provided us the data.
cooperation. There is scope for the corporates too, to make different choices for CSR activities, depending upon the funds that they have. OCTOBER 2020
32
PANELISTS
W
hen the Covid crisis struck India, at a
investigation? How much manpower can the government
moment’s notice, our police force swung into
provide to the police?”
action and came to the rescue of the
He highlighted the shortage of manpower as a major
government by maintaining order on the roads, taking care
problem for the police. “Out of two million police personnel
of citizen’s safety, standing behind the health workers and
in India, more than 75,000 go for paramilitary duty and
doing a commendable job in combating the pandemic,” said
roughly a million are available for protecting the common
Mr Raghavan. He praised the Indian police for grabbing the
man,” Mr Raghavan said. He lamented that in India, people
opportunity presented to them and proving that they are a
expect the government to do everything and indicated there
force to reckon with.
is plenty of scope for NGOs and Private Sector to chip in and
“In the days of my career, the police approaching the
strengthen the resources of the police.
private sector for support was stigmatised. Today, fortunately, the situation has changed. Recently, I am told,
Multiple responsibilities
the Maharashtra government quickly and generously
“Even though the police are the first responders for any
accorded permission to the state police to seek support from
public crisis, our police are woefully understaffed and heavily
the private sector for their efforts in managing the
overworked,” said Mr D Sivanandhan. “Since 1945 to 1947,
pandemic,” said Mr R K Raghavan.
36.000 police personnel have been killed and they have
He however raised certain pertinent questions. “Were our police equipped to handle the situation? Is it fair to expect them to carry out so many tasks and execute varied instructions like, for instance, enforcing closing down of shops at different times on different days and which led to the unfortunate Sathankulam episode that is under CBI
made the supreme sacrifice of laying down their lives in upholding their responsibility. Over 74,500 have so far been affected by Covid. More than 435 have died in fighting the pandemic, with Maharashtra accounting for 50%,” he stated. On the roles that police play, he said, “They take care of
Business Mandate fountainhead of excellence
law and order, crime control, crime detection, management
implementation falls on the police. On the one
of traffic during normal times and special festivals, VIP
hand, there is shortage of manpower. On the other
movement, pandemic management and so on.”
hand, the duties keep on increasing. Therefore, the government should do a detailed costbenefit
From peak fitness to depression… Mr Sivanandhan elaborated the reasons for police personnel
analysis before implementing new social laws. •
through a separate wing or consider the
ending up with depression. “We recruit the best candidates
requirement of additional manpower to the police
with the best physique for the police force. But by the time they turn 30, they wade through multiple problems like
The government can think of enforcing social laws
when implementing new laws. •
The government can include ‘’reaching out to the
having to work for 12 to 14 hours per day, irregular food
police” under the permissible list of activities to
habits, lack of leave or rest and unlimited stress. There are
qualify for the 2% mandatory CSR spend of
no rest rooms for women police while they are on outdoor
companies, through a proper mechanism. This
activities. The police have an endless list of bosses including
could
their superiors, bureaucrats, Press, TV, Politicians, Courts and Commissions. Anybody can pull them up. They have no right to form a trade union or any association. According to
include
activities
like
providing
infrastructure, technology, equipment and health facilities to the police. This will lead to the police getting lot of support from private sector.
a study, many police have died between the age of 37 and 41 from stress induced illnesses.” Thanks to the effects of Covid, there will be a spurt in property and credit card related crimes, cybercrimes and chain snatching incidents. Many crimes will be committed using smartphone or technology as a tool, warned Mr Sivanandhan and indicated that the public must exercise great vigil. His suggested a number of steps to strengthen the police
Were our police equipped to handle the situation? Is it fair to expect them to carry out so many tasks and execute varied instructions like, for instance, enforcing closing down of shops at different times on different days... How much manpower can the government provide to the police?
force: •
Police have to upgrade technology.
•
The Police Act 1861 has not been revised so far. Amendments have to be made to the Act, to
• •
Mr Sivanandhan quoted from his experience of
reflect the current situation.
providing 30 stateofthe art gyms for the police in
Nonessential arrests should stop. This will free
Maharashtra when he served as DGP there with the project
the police of considerable work load.
undertaken completely with the public support. We say,
The physical fitness of the police personnel needs to be improved through SIP– Systematic Investment (in Health) Programs.
“Doctor, Heal Thyself.” The police too as Defenders must defend themselves, he said. Dr Meeran Chadha Borwankar pointed out that we did
•
The police should focus on ‘Team Building.’
•
Whenever new social laws are promulgated, like
not remember the police before Covid and wondered if we
banning of smoking in public places, the onus for
would forget their role after the Covid days. According to
36
OCTOBER 2020
Business Mandate fountainhead of excellence
Dr
Meeran
pitched
for
upgrading technology available with the police. “Now, police use their vehicles to take the accused persons to the courts. These can be avoided by switching to virtual mode. We need to scale up ecourts where trials can be done online and evidence can be presented on e platforms. For prison inmates, we should provide timely medical support using telemedicine. By these measures, we can greatly research, she said that on an average, the police work for 14 hours a day and for 365 days in a year. The Epidemic Act 1897 is now being used by our
strengthen our police force,” she said. In the Q&A Session, the panellists answered a variety of questions.
governments to manage the pandemic but its provisions are not known to many of us, she said. She argued that the 30% vacancy in the police force all across India must be
Do our allwomen police stations serve their purpose?
highlighted and quickly remedied. “It may be shocking but
Dr Meeran: It is now realised that the allwomen police
the finding from a survey is that 37% of the police are
station is not a great idea, considering the ground realities.
demoralised and would not want to work in the department,
Instead of having a limited number of allwomen police
given an option,” she said.
stations, all police stations should have on their rolls, women police, along with men.
Academia must research on policing Dr Meeran said that all police personnel undergo 6 to 9 months of rigorous training on recruitment. But, only 6%
How does our police force compare with their counterparts
of them go through inservice refresher training. She
in other countries?
appealed to organisations like MMA and ORF to collaborate
Dr Meeran: I did an internship under Fulbright Hubert H
with the police to develop case studies and train the
Humphrey Fellowship program and interacted for a year in
constabulary on life skills, so they can stay motivated. She
the US with the police there and later for four months with
suggested that our academia should do extensive research
the police of Australia. Based on my experience, I rate our
on policing and criminal justice system in India and suggest
Indian police as more disciplined despite their numerous
improvements which can be taken up for implementation.
challenges and that they carry out a much wider spectrum
“At present, there is very little research done in these areas,”
of duties and without any overtime.
she remarked.
OCTOBER 2020
37
Business Mandate fountainhead of excellence
Have we captured the lessons from the pandemic?
How can we deal with the VIP culture with the VIPs
Mr Sivanandhan: Many of the lessons are converted as
expecting special treatment in our country?
Standard Operating Procedures (SOPs) and these are now
The panellists pointed out that today thanks to public
available in states like Telengana and Maharashtra.
awareness, media campaigns and social media impact, many VIPs shun special treatment. They are concerned that if
If there is another major spike in Covid, are our police prepared?
someone takes a photo of them demanding or being given special treatment and posts it in social media, it will affect them adversely. Mr Raghavan singled out the impartial role
Mr Sivanandhan: Covid came without any warning, yet
played by CISF deployed in airports. They treat everyone on
our police have so far handled it admirably well. In Mumbai,
a same footing and they have set an ideal example, he said.
they have created facilities for 75,000 beds. The outbreak in Dharavi was handled very well, and handling of Dharavi has now become a model for United Nations. So, there is no
What role can the Retired IPS Officers associations play in
doubt that the police can handle any future spikes too.
the current situation? Mr Raghavan: They have very limited role to play as they
How can we change the mindset of our people to follow Covid precautions without fail? The panellists felt that we need to run more awareness programs, because, if we are not aware of the rules of the game, then we are going to lose more lives.
have no authority. I may be hauled over the coals for saying so. But that is the reality. At the same time, there have been individual bright spots from the retired officers like Mr Julio Ribeiro, who are able to create an impact. The police, having gained an invaluable experience in handling the pandemic, should document the experience; and create enough training materials and literature from the
How can we improve the public experience of dealing with
Covid lessons to train future police recruits and for posterity.
the police?
If you don’t learn lessons, halfthe battle is lost.
Mr Raghavan: If systems are designed in such a way that there will be less facetoface contacts with the police, then it will lead to a better experience and efficiency. In that case, complaints can be filed online with proper supporting documents, which in turn can be converted to a FIR. But for this to happen on a scale, the police stations should have the best connectivity possible. They should be given top priority because police stations are, in fact, a symbol of governance.
38
OCTOBER 2020
RAMYAA RAMESH
T
he
career
of
Lakshmi
Venkatachalam is riveting and fascinating, especially her
uncanny
ability
to
embrace
opportunities that comes her way. It is not easy to forge a career in the US, especially when one does not graduate out of a university there; Lakshmi seems to have managed it very effectively. It would be interesting to follow the journey of this typical ‘Mylaporian’ girl who did her schooling in Rosary Matriculation and then completed her B.Com in Ethiraj College. She later completed MBA and ICWA and was all set for a great career in India with her first job at Pond’s. It was a job that was doubly exciting for her—as it was in Chennai itself, a city that was her greatest love. But matters of the heart took priority. Marriage to her classmate, who wanted to pursue his career in the US, took her to Silicon Valley, California. A finance and operations career in an all tech Silicon Valley seemed a difficult prospect for young Lakshmi as she began her career search. However, she believed in herself and has strived hard to see herself as a Vice President in the $40 billion technology giant, Oracle Corporation today. “Believe in yourself, work hard, do
Business Mandate fountainhead of excellence
your best and you will be successful,” summer internship at Pond’s. I ended
to connect remote villages to ensure
she says with conviction. “It was not all
up getting my final placement in the
information on crops, illnesses, and
that difficult to decide what I would do
same company and that too in my
natural calamities was circulated so that
after my B.Com. I love numbers—I
hometown Chennai, an icing on the
the villagers could be better prepared,”
relate to them and understand the story
cake! It was my dream job; the most
she said.
they tell me. With my father being a
coveted place to work for and I was
Chartered Accountant, doing CA seemed
ecstatic to land this opportunity. Now,
The crossing
a natural choice. However, the challenge
as I look back, age just does not matter
Lakshmi met her husband in IIM (B), an
of getting into an IIM led me to take
as long as you enjoy doing what you are
engineer at heart, who went on to the US
CAT. Luckily, I got calls from both IIM
doing, but I was 21 when I got my job
for his grad studies and wanted to stay
Bangalore and Calcutta and I decided to
offer and it was an incredible
there. Marriage in 1997 took her literally
accept Bangalore as it was closer to
achievement for me at that time!” said
kicking and screaming to the shores of
home!”
Lakshmi. She believed Pond’s was home
the United States.
—a company that challenged her,
“We set up home in the Silicon
The lure of Chennai
pushed her, and also cared for her at the
Valley where almost everyone was a
“My new adventure of an MBA excited
same time. She joined the company as a
‘techie’ and very few really understood
me but I faced the rude shock of having
management trainee, and for 18
what finance and operations were,” she
to live away from home. I spent my first
months, she worked across various
said. “I would remember my initial
six months figuring out how to get home
functions and locations.
months in the US as one of the worst
every weekend. I found myself on
“One of the most interesting
periods of my life in terms of my career.
projects for me was working around the
I still remember sitting in a coffee shop
villages of Etah, UP, as part of our social
with a recruiter who looked at my
responsibility assignment. There were
resume and said, ‘If you get a temporary
villages with no electricity, yes, in 1994.
job paying even $20, I would be very
We spent our days interacting with
surprised.’ I went home extremely
villagers,
grassroot
dejected that day. My husband probably
problems and helping find solutions.
remembers the day even more vividly
Organizing child immunization camps,
for the amount of grief he got! I realized
Over the years, she learnt that
talking to the women about health
two things, a job rejection or failure is
everything is a transitionary phase and
issues or addressing cattle care—we did
not the end of your life. One failure does
one will go through many difficult
it all. The village doctor even indulged
not evaluate you, you just need to get up
phases in life and evolve to become a
me and allowed me to inject medicines
and keep going.”
stronger person.
for a buffalo. As part of a project, my
Brindhavan Express or Bangalore Mail more often than I was on campus. I learnt a lot of management principles during the two years in Bschool, but I also learnt the important lesson of how to live by myself, knowing that home and Chennai were not far away,” said Lakshmi.
A dream job in a company that was ‘home’
fellow management trainee and I designed a walkietalkie network across the villages. It was the premobile phone
“I was extremely excited to do my 40
understanding
OCTOBER 2020
era and it was considered the best way
At the right time, right place “Is everything orchestrated? I wonder at times. I was in a temple one day when I heard someone calling out my name.
Business Mandate fountainhead of excellence
It turned out to be a senior from school.
management processes. We just took
She told me that Bearing Point
over the entire finance operations and
Consulting was recruiting. I expressed
helped prevent insolvency and brought
interest, and thanks to her referral, I
the company to a cash positive state.
found my first job four months after I
We also set up ecommerce stores for
moved to the US,” she said.
companies, because the Internet had
This
first
job
of
hers
in
management consulting helped shape
gained prominence and was opening new channels for them.”
her in many ways. She, along with her
Though work was very interesting
team, working directly with CXOs, was
and exhilarating, after four years of
looking to solve problems that were
constant travel, and waking up some
crossorganizational and sometimes
mornings wondering where she was,
global. It trained the mind to quickly
Lakshmi decided it was time for a
filter down to the problem and make the
change.
changes required. She travelled from one end of the country to another and
My time in a startup
was exposed to multiple industries and
Change came in the form of an opening
cultures.
with a startup called Veloz Global
While most of her projects were interesting, a few stood out. She
“My first project was for a company that sold musical instruments and was looking for a plan to expand their stores across the country. We made a proposal for the probable locations based on census data, demographic and economic profiles of the areas. We also set up complex mathematical models that stock
holding
and
transportation costs and optimized warehouse locations. Another project was for a food coop that made canned food. Though very popular and successful, they were on the verge of bankruptcy
due
to
poor
workflow automation solutions. “It was local, a known team and an
enthusiastically spoke about them.
minimized
Solutions, which focused on creating
cash
opportunity for a stint that could make it big! We were less than 20 employees and I had the opportunity to do everything from process design to office space hunting to hiring to VC presentations. The founder and I have continued to share a great personal and professional bond—but I learned that I was not best suited for a startup life.” Lakshmi went on to explain. It was also the time when her son was born and she decided to take a year’s break. Career after a break “When I was ready to go back to full time work, I started the job search OCTOBER 2020
41
process. It was deja vu all over again. After several rounds of interviews, I was close to joining Infosys in the US when I received a call from a recruiter
about 40 to 250+ in a year and it is a key
exceptional people. And for you to
contributor to our consulting capacity
succeed, do your best and do better than
globally. It was new, challenging and
your best the next day!”
very gratifying for me personally. And of course, the attraction of visiting India
The best is yet to come…
and working with teams there cannot be
“My biggest achievement? That is yet to
missed. Having worked both in India
come. I cannot look back and think of a
and in the US, I was able to balance both
single achievement and say that it has
work cultures well. The work I did and
been the most important and valuable.
the lessons I learnt from my consultancy
I believe that at every stage we set a goal
days also came to my rescue. I have been
and achieving that goal seems like the
deeply involved in multiple acquisitions
biggest challenge at that point in time.
The Oracle sayeth...
and have integrated them into our
Then you realize there is a next step that
“Oracle is where I have spent more than
business. Every acquisition brought
you want to reach.” she says. So, what is
14 years of my career. I was part of the
unique needs and challenges which
Lakshmi’s next big goal—to become a
core team that managed the acquisition
required equally unique solutions.”
COO of a global company.
one day. I did not make much of it initially but on his persistence, I went to attend the interview at Portal Software and ended up with an offer letter. It was meant to be,” she said. It laid the foundation to her career with Oracle; Portal was acquired by Oracle in 2006.
and the integration of Portal into Oracle
Recently, she has taken on a new
As a woman who had the ability to
initially and this helped me build key
role in Oracle. As Vice President of
dream big, take up challenges as they
relationships within the company. I
Operations for the Communications
come without being overwhelmed by
work with a wonderful bunch of people
Applications Business Unit, she heads
them, we have bigger hopes for this
and have had progressive opportunities
endtoend
including
Chennai girl—that she joins the ranks of
with global exposure. I understand how
strategic planning, sales, engineering
Indianborn CEOs of global companies!
the company works and have a deep
and consulting operations and learning.
Best Wishes, Lakshmi!
network that sets me up for growth and success. In terms of assignments, I ran operations for the consulting business and as part of that, I got to build an offshore delivery center across four cities in India. We grew the team from
operations.
“I am often asked if there are differences between working in the US vs. India or in different companies. Probably, yes. But the fundamental truth remains that all successful companies in any country are driven by strong processes and
Ramyaa Ramesh, author, had interviewed Lakshmi Venkatachalam for this series.
I
am inspired to write this column for Business Mandate after witnessing the resounding success
of the recent presentation of Ritesh Andre, Spokesperson for Mumbai Dabbawalas, and our associate Raja Atmamayan, Vice President, ASCENT Transformation Ventures, Coimbatore. MMA reported that two thousand viewers tuned in for a Sunday session and many provided positive feedback on the session. It is hoped that viewers would consider making a donation to the Dabbawalas. MMA is to be felicitated and thanked for this success. The viewers learned in the presentation
that
exemplary
performance is possible when and only when the level of internal excellence is high. In the case of Dabbawalas, theirs is a Six Sigma operation and the Dabbawalas are Varkaris, intensely devoted to customers and whom they consider as God. Internal excellence and emotional excellence are two sides of the same coin. When emotional excellence rises, the level of internal excellence too will rise. Pursuit of high levels of emotional excellence is a wellposed scientific problem. Emotions can be measured, and the process with which to enhance
Business Mandate fountainhead of excellence
emotional excellence is meditation, or
of emotional excellence will bring a
itself has provided ample evidence
more generally yoga, known for
myriad of additional benefits. They
of such creation. One famous
thousands of years. Since emotions can
include:
example from Tamil Nadu is S.
be measured, progress can be audited. As evidence on the need for emotional excellence, Gallup published a survey of a large number of business units across many industries in 2004
• Health and wellness. Negative emotions lead to stress, a root cause of many serious illnesses including cancer. Nobel Laureate Elizabeth Blackburn has shown that high levels of stress shorten telomeres
finding that there were more than 22
(the protective caps at the ends of
million workers—in the United States
our chromosomes) and accelerate
alone—who were extremely negative or
aging. Medical researchers have
"actively disengaged." This rampant
also
negativity was costing the US economy
lengthens telomeres and slows
between $250 and $300 billion every year in lost productivity alone. Gallup estimated that when workplace injury,
shown
that
meditation
aging. • Leadership. Harvard Business Review has carried numerous Researchers reported in HBR that
were added, the cost could exceed $1
intuition and selfawareness are
trillion, annually. In fact, they found
critical components of leadership.
that negativity appeared to have spiked
Intuition is immediate cognition
across the world in recent years.
without the benefit of the five
Emotions Survey, BBC said people around the world were angry, stressed
senses and the rational mind. Yogic processes can enhance intuition to a point it becomes possible to do numerous
tasks
blindfolded,
and worried. Gallup interviewed
provided training is given at a
150,000 people in 140 countries for
young age. For adults, meditation is
their 2019 Global Emotions Report and
a route to enhanced intuition.
found that a third of them were stressed while one in five experienced sadness or anger. In this survey, the United States was 39th most positive country and India ranked 93rd. Clearly, negativity is a serious issue for India Inc., as well.
• Less discord and violence. Improved
interpersonal
relationships, less discord and violence are natural consequences of higher levels of emotional excellence. • Creativity
and
Negativity and negative emotions
innovativeness. Pursuit of higher
are synonymous. Negative emotions
levels of emotional excellence is a
lead to stress while positivity attenuates stress. Successful pursuit of higher levels 44
OCTOBER 2020
graduate,
Ramanujan
would
formulate complex mathematical theorems and their proofs without knowing the steps in between. He told his mentor, G. H. Hardy at Cambridge,
creation
happened
when he connected to the source via a prayer to his Goddess. Progress in America Ancient India is the home of emotional excellence, but you would find it interesting that America is recognizing
reports on emotional intelligence.
illness, turnover, absences and fraud
Reporting on Gallup’s 2019 Global
Ramanujan. Barely a high school
pathway to connect to the source where all creation happens. India
Emotional intelligence is an intellectual inquiry to fundamentally understand the importance of emotions within oneself and in others, and it indicates the capacity to be aware of one’s own emotions and intuit the feelings of others with obvious implications for decision‐making.
Business Mandate fountainhead of excellence
its importance independent of any
Intelligence: “In 2002, UNESCO began
intelligence by itself cannot bring about
scriptures.
a worldwide initiative to promote social
the required positive changes from
In 1990, University of New
and emotional learning (SEL), sending
within.
Hampshire psychologist, John D. Mayer
a statement to ministries of education
Emotional excellence, the term I
and his friend and a fellow psychologist,
in 140 countries.” He writes that he was
have coined, is the wherewithal of how
Peter Salovey, now President of Yale,
most gratified to note that tens of
to bring about the required positive
coined
“Emotional
thousands of schools worldwide offered
changes from within and there is only
Intelligence”. By then, the importance
children SEL. He says that in the United
one way to achieve this feat and it is
of IQ was wellknown globally but the
States, many districts and even entire
through meditation, or more generally,
profound implications of emotional
states currently make SEL a curricular
yoga. No amount of training, rules,
intelligence or EQ (emotional quotient)
requirement mandating that just as
regulations, and policies, topnotch
had not yet been understood in the
students must attain a certain level of
quality initiatives, nor intellectual
West.
competence in math and language, so
pursuits will cut the mustard.
the
term
Emotional intelligence is an intellectual inquiry to fundamentally
too should they master these essential skills for living. The
Alarmed by the aggressive pursuits of China, India Inc., appears to be
Business
making concerted efforts to wean
within oneself and in others, and it
Roundtable released a New Statement
companies away from China to India.
indicates the capacity to be aware of
redefining the purpose of a corporation
There is also a reported effort at
one’s own emotions and intuit the
in 2019. The 181 CEOs of some of the
Government reforms. Pursuit of
feelings of others with obvious
largest companies in the world who
external and internal excellence is
implications for decisionmaking.
signed the New Statement, committed
essential for the success of these
to lead their companies for the benefit
initiatives.
understand the importance of emotions
Relatedly, Daniel Goleman first published the bestseller, Emotional Intelligence in 1995. That book sold four million copies and was on the New York Times bestseller list for a yearanda half. According to HBR, Goleman’s articles on emotional intelligence are some of the most enduring in their publication. Goleman says in his HBR article, “IQ and technical skills are important but emotional intelligence is the sine qua non of leadership.” Goleman goes on to say in his tenth anniversary edition of Emotional
of
prestigious
all
stakeholderssuppliers,
employees, customers, communities and shareholders, away from the shareholdersfirst ideology. A little reflection should convince the reader that enhancing internal excellence is the only route for one group of stakeholders to work for the benefit of all stakeholders. The progress Americans have made in realizing the importance of emotional intelligence is laudable. However, as important as an intellectual inquiry to fundamentally
understand
the
Pradeep B. Deshpande is Professor Emeritus and a former Chair of the Chemical Engineering Department at the University of Louisville. He is also President of Six Sigma and Advanced Controls, Inc.
importance of emotions, emotional OCTOBER 2020
45
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