Saturday, December 28, 2013

The year 2013 and what to expect in 2014

The last week of the year is a good time to look back and analyse the main events. I have chosen the ones that I feel are important from the point of view of the future and thus have chosen to overlook some larger events that impacted the present more than the future (like Sachin’s and Mr Tata’s retirements). Happy reading!!
Bharat Ratna To A Scientist
This is the highest civilian honour to be conferred to a civilian. This year it goes to our cricketing super hero Sachin and one Mr CNR Rao. He is a brilliant chemistry scientist and only the third Indian scientist (out of the 43 total awardees till date) to be honoured with the Bharat Ratna after Nobel Laureate C.V. Raman in 1954 and former President A.P.J. Abdul Kalam in 1997.  All our scientific accomplishments have been from the distant past, it is high time to encourage scientific achievements and reclaim our lost scientific glory. I hope we have more such chances to celebrate in the future.
Social Awareness
This was the year of the socially active. AAP success was in a large measure due to this phenomenon. We as citizens became very aware of our rights (not so much of our obligations) and were not afraid to take to the streets to show our likes (or dislikes – as the case may be).
I am sure this will carry on the next year as well with the elections giving enough opportunity to people to remain active. I also hope that this trend continues beyond the next year as well.
Gold Crashed
Gold is down 30% in the international market. It is down about 20% in India because of the 10% import duty being charged by the government to discourage imports (from Rs 35,000 to 29,000). This is the highest single year decline in the price of the precious metal in the last 20 years. Expect the price to remain here or head further down the next year as well. Note – I am not a great fan of the yellow metal (I held the same view when gold was doing very well, my earlier blog “Is gold a problem or a solution”) so the same should be read in that context.
Mars Mission
ISRO has been one of the rare great institutions that the government has built. Our satellite launches cost a fraction of what it costs anywhere else in the world and our missile programme also derives a lot of its success from our space programme. This year we did the impossible – we are on course to send a rocket on Mars. It is a very big deal indeed (we will be the fourth country in the world to achieve this) and expect us to become very serious players in the space market. The moon mission is also under way and more glory awaits this great institution.
Salute The Indian Manager
This year belonged to the Indian manager. While the trend has been picking up for the last few years, it became really big this year. I am avoiding names here as there are just too many. The managerial capabilities of Indians are now well respected the world over. Our culture also plays an important role – we are tolerant and hard working by nature and are not bogged down by diversity which is common in the global workplace.
Expect more Indians to occupy the corner offices of the global corporations in the years to come.
Powerful Men Can No Longer Get Away
Lalu, Asaram, Tejpal, Sen, Jignesh, Mallya, Deccan Chronicle promoters, Phaneesh, Rajat, Kahn, Berlusconi – the list is long and the charges different but the message is the same – you will be held accountable no matter how higher are you in the society. Outside India the justice was served without delay – in India we wait still for the bad apples to come face to face with their makers and then pay for their sins.
Presidential Activism    
Pranab Da worked hard to restore the legacy of his office. He had hard work to do specially to undo the work of his predecessor Mrs Patil (mind you, this year she finally chose to return all the gifts that she had taken home). And boy, did he deliver? Kasab and Guru (who waited for 10 years for presidential pardon) were sent to the gallows while he delayed signing the legislation protecting the tainted legislators will it was famously “torn and thrown to the dustbin” by RaGa. Great work indeed. Encore expected this year as well. May God give him the strength to do what should be done.
Supreme Court Activism
Thankfully the SC stepped in where the government failed. They had a lot of work to do this year as the government practically didn’t do anything at all. All the major policy decisions were shaped by the SC – rather the government worked for the fear of the apex court. We will see the more of the same next year – an incompetent government being pushed into action by an active judicial system. Reminds me of the famous lines of the Joker to Batman – when an unstoppable force meets an immovable object, the result is.....
Time for a Political Change
The momentum is building up for the general elections next year. Change is in the air and the UPA and its constituents are feeling jittery, to put it mildly. The disastrous 10 years that Mr Singh has been the PM of the country have been the worst that I have seen – endemic corruption, systemic breakdown of public institutions, very high inflation, very low growth, no employment generation, negative sentiment in the business community, worsening fiscal situation both at the centre and the states, currency going for a toss – Mr Singh and Mrs Gandhi leave a legacy that RaGa will have to pay for by sitting in the opposition benches for the next 10 years – maybe it will also be good for him and the grand old party – they have been so addicted to power without accountability that a long “rehab” is advisable for them. This is no anti incumbency – see the incumbent state governments of Gujarat, Bihar, MP and Chattisgarh being voted back to power. This is a message to the political system that for too long the Indian voter has been taken for a ride and the time has come to change this.  
Disastrous Foreign Policy
If you thought the current government had a worst economic policy, you need to see the blunders in our foreign policy. The world’s second largest democracy and our natural ally the US is now cold to us. Our old friend Russia is indifferent. China is claiming larger and larger parts of our country as theirs – they even did a mini Kargil in the northeast. Sri Lanka has been driven to the open arms of China. Afganistan will be in a vacuum once the US leaves. The leader of the party who thinks for us is under trouble from extrmists in Bangladesh. The real perpetrator of Kargil is back in power in Pakistan. Maldives publicly humiliated us by unceremoniously throwing out a large Indian group out of their country. Nepal doesn’t care. The blog of Indrani Bagchi captures all this beautifully
Although I am itching to write about the AAP’s proposed policies that will turn out to be disastrous, that will have to wait for a fortnight. Next week we will look at how the BJP is undermining itself by doing its best to lose the momentum that it generated.

Saturday, December 21, 2013

Thank You

The last two weeks of the year mean different things for different people. For most of us it is a time to plan for a party – to celebrate the year gone by and welcome the coming year in high spirits (literally). For some of us (including me) it is a time for introspection – hits, misses and the plan for the next year. But it is also a time of intrigue for me as most of the western world heads for almost a 2 week holiday. I wonder how can countries practically shut down for 2 whole weeks. Thanksgiving and Christmas are the festivals responsible for this annual shutdown.  While Christmas (Santa Claus - a very good example of globalisation and a connected world – I am sure he can be recognised anywhere in the world) is widely celebrated across the world, I think Thanksgiving is equally important.
Thanksgiving was originally the harvest festival of the west – people celebrated a good agricultural season and thanked Gods for the same. As a festival it is celebrated across the western world, although on different dates. I find the idea behind the festival very compelling – thanking the almighty and all others who have made a difference in our lives and is one of the things that I should have added to my previous blog – what we can learn from other religions (21 Sep). Even in India various states celebrate different harvest seasons but thanksgiving as a festival concept is still uniquely western in nature.
Come to think of it – there are multitude of people that make our lives better every day. While some of them can be thanked directly – our families, friends, colleagues, service providers and many others, most of them are working earnestly but are not in our line of sight. How about a special day for thanking them? A day spent thinking about the positives and to thank the almighty for making our lives beautiful. Although I know and fully understand that things are not perfect and lot of things could be a lot better, still there are a lot of things in our lives that we should be thankful for, as things could easily be a lot worse than they actually are. While we are formal in our approach and thank a lot of colleagues for helping us out (or not creating un necessary obstacles – as the case may be) we don’t thank our family enough (at least I don’t). Relatives are a different discussion altogether – although most of them can easily be classified as a pain in various body parts – some of them are blessings that we should be thankful for.
A day spent in counting our various blessings and thanking everyone for the same will indeed be a special day. For us as it would create a lot of positive energy. For the receiver of the thanks for it will make them feel special, valued and encourage them to keep doing the things that made them special in the first place. A show of sincere gratitude indeed goes a long way in keeping the “positive feedback” cycle going.
I think it is something that we all must do. It is definitely something I will start doing. This should be on the top of our list in the concepts and culture that we are in a hurry to copy from the west. Let us copy it and modify it for our society by adding humility to it.
As we head to the last week of the year I wish all readers an amazing festive season. Next week we will look at the year and 10 major events that will have a disproportionate impact in the times to come.

Saturday, December 7, 2013

What I may do VS what I will never do

Life is full of choices. Come to think of it – every decision that we make is a choice between 2 or more options. Although choices make life more exciting, they also bring about the pressure and post decision stress – have we made the correct decision. The plethora of choices is not always a good thing – I always find it more difficult to make a purchase decision if there are too many options to make a choice from. Some friends have been happier to make a marriage decision (arranged marriage – a very imp one in life) by limiting their choice to five or less candidates, others have been far unhappier to look at close to 100 candidates and then realising that the 6th one was the “better” choice!!  
The question that arises is – should choices always be available? Are choices always good? Maybe not. There are many things that would rather not have choices – what we can call the “negative list” these are the things that one would not do no matter how compelling the choices. For example – I cannot stay in UP although most of my relatives are there, I cannot indulge in anti national activities no matter what the payoff. Most of the moral questions should find their place in the negative list.
That also leaves us with another question – can one determine the choices that one can have in life? Or is it better to keep options open and then decide what is best from the available choices. In this case the negative list helps – if we don’t have to do something then the choices don’t matter.
The opposite of the negative list can be the “positive list” this is where we can have choices or must have choices. The positive list can be very exhaustive and may be impossible to compile. Hence it is important to have a small negative list and follow the same.
Problems arise when everything is fungible, including the choices in life. It is important to have goals in life and work towards achieving them and the choices that we make in the process are extremely important.  The negative list can prevent all the indiscretions that people indulge in and then the repent.
In the last 2 weeks there have been various reported instances of powerful men having made wrong moral decisions and having seen their lives and careers being dissected by the media. Come to think of it – how can one go wrong on these very basic moral questions? I guess it is about the choices or options available. Maybe if there was a non negotiable negative list for these people these indiscretions would not have arisen.   
So think through to create your own negative list and may God bless you with the power to make the correct choices.

Saturday, November 23, 2013

Famous Business Rivalries

Competition is good for everyone – individuals, companies, education institutes, states and societies. It encourages one to excel in their chosen field, drives innovation and keeps everyone on their toes. The only thing to watch out here – competition should remain healthy. Classic example is the rapid strides made in the space exploration programme in the 1980’s when the USA and USSR were locked in a race to be the first one to send a man on the moon – many often lament that the progress in the space programmes has become slow after the disintegration of the USSR as there is no competition to the USA. It is also true that competition can bring out the worst in us, if the aim is to win at any cost.
Similarly monopolies are bad for the society, especially in business. Notice how most of the monopolies are run by the government - public transport, water and electricity supply, law and order, waste management. Monopolies emerge in the absence of competition eventually get misused as the people have no other choice but to pay the price that the monopolist demands.
Let us now look at some famous business rivalries that have spurred entrepreneurs and benefited customers over the years -
Ferrari vs Lamborghini
Enzo Ferrari founded the company in 1947 that bears his name and is famous for making mean racing machines. Ferrucchio Lamborghini was a tractor engineer who began purchasing Ferraris for personal use in the late 1950s and believed the car could become better with some modifications – suggestions that were promptly brushed off by Mr Ferrari. This led to the birth Lamborghini that competes with Ferrari in making racing cars and has benefited racing fan across the world.   
Coke vs Pepsi
The oldest and the most followed rivalries in business history. Coke was launched in 1886 and Pepsi was born 12 years later. Since then they have been in serious competition with one another across the world and have spurred product innovations and many interesting ad campaigns in the process.  
Microsoft vs Apple vs Google
Microsoft virtually monopolised the PC market with Windows and was way ahead of Apple till the launch of the IPOD, IPAD and the IPHONE – the founders of both the companies had opposite ideas on how the computing industry should evolve – both the founders were famous dropouts and it did not help that that windows was not suited to run on Apple computers. Microsoft totally missed the move from PC to smart phones and Google capitalised with its famous Android operating system for phones. The rivalry has now shifted to Apple vs Google with Microsoft a distant third in the smart phone OS market. While the verdict is still not out, the loss of Steve Jobs may prove to be a major disadvantage for Apple in this battle.  
Ford vs General Motors
Ford was founded in 1908 and General Motors 5 years later. The founders of both the companies and their successors took different paths to build the company but the rivalry still continues a century later.
Visa vs Mastercard
Both Visa and Mastercard are global payment gateways. Financial institutions issuing debit or credit cards tie up with them and issue cards that carry their logo with one of the above. The competition between that has ensured that the transaction charges remain low and the list of the outlets accepting card payments keeps going up and the transactions become secure with each passing day. 
So keep the competitive juices flowing and supporting your favourite company. After all, it is for us consumers for whom these business rivalries have been on for centuries and will continue well into the future.
The title for the next weeks blog is being kept a secret and will be unveiled soon (next week, actually).  

Saturday, November 9, 2013

Gyan aur Dhan (Knowledge and Wealth)

We worship both the goddesses of wealth (Maa Lakshmi) and the goddess of knowledge (Maa Saraswati) to seek their blessings. Their photo with Lord Ganesh sitting between them is a common feature in the puja ghar of most Hindu households. I thought it would be interesting to see how gyan and dhan compare to each other.
Gyan or Knowledge has been sought after and desired by the Indian society for time immemorial. Even today our society respects a person with knowledge more than the wealthy. Dhan or Wealth is being sought after only recently – till 20 years ago the rich were generally looked at with suspicion – most of the villains in the movies were the rich people. Ostentatious display of wealth was also looked down upon. The lakhpatis and crorepatis were hard to spot and had to be pointed out in a crowd. Now wealth is celebrated and displayed rather openly in everyday life. So Knowledge gets you respect, wealth gets you envy.
Knowledge is ever lasting  - unless you are unfortunate enough get a rough knock on your head and lose everything – one more popular scene in the movies. Wealth is more temporary in nature – there are many stories of rich people becoming poor in a very short span of time. Knowledge is permanent, wealth not.
Knowledge can lead to wealth. Wealth need not lead to knowledge – on can be wealthy but not necessarily knowledgeable. Similarly one can be knowledgeable but not necessarily wealthy.
Wealth is easy to measure. We can exactly know how wealthy we are and estimate the wealth of others (except in Delhi where the entire city looks like made up of crorepati residents). Knowledge is difficult to measure, as someone said – the more we learn the more we realise how ignorant we are. And it is not a talent that people normally compete for – you will hardly hear “I want to be more knowledgeable than you are”.
Knowledge and wealth are not mutually exclusive – they are known to co exist, more so in today’s world of IT where good ideas can get popular almost instantly and lead to great amount of wealth. However it would suffice to say that if you don’t have knowledge, you will not be able to retain wealth. Those with knowledge can also hope to recover the wealth they have lost due to an unfortunate event.
Wealth can be got by illegitimate means –short cuts are generally the faster way to accumulate ill gotten wealth. Knowledge can only be gathered by the hard way – continuously keeping at it for a long time daily.
Knowledge is difficult to pass on to the next generation – unless they are suitably disposed. Wealth is easily inherited from the previous generations, although staying wealthy may not be so easy if one is not capable of handling the same.
Both also have similarities – the possessors of both cannot rest. One cannot have too much knowledge or too much wealth – it becomes a lifelong passion to gather more of it every day. Also the attainment of these can easily lead to pride and arrogance – qualities to watch out for as they invariably lead to a downfall of an individual.
From the point of view of desirability – knowledge is better, in its pursuit many have stumbled upon great riches. Many have also discovered that wealth or the worldly pleasures are unnecessary distractions.
As for me, I am more in favour of attainment of knowledge. I will end the blog with a prayer to both the goddesses to bless the readers so as to maintain a fine balance in our lives. Next week I will take the readers through some famous business rivalries which have benefited the society.

Sunday, October 27, 2013

Ads – Fads

For people like me for whom marketing is a profession, it is a way of life. But like it or not, this is true for all others as well. Come to think of it – we have to market ourselves to our employers – both current and prospective, life partners (before and after marriage), relatives, social circle and everyone else. Conscious or otherwise, it is an activity that we can’t do without.
Some people take it to extremes – too much show off, some underplay it. Same is true for brands - great brands connect with their consumers and are able to charge a premium while others flounder. There is some inherent value and some perceived – for good brands the perceived value is very high. While good products and services eventually get popular, the role of advertising should be restricted to the dissemination of information about the launch of a new product or service.
With the overload of information and the emergence of electronic media, more and more advertising campaigns have been “trying” to be different to break the clutter. Some of the recent ones have been downright stupid, as below -
Two time strong jeans –
So till now we were wearing weak jeans, even then the normal jeans refuse to wear and tear after years of abuse, I wonder what will the newer stronger jeans will do to us.
3D TV ad in normal TV -
If I can appreciate the features of a 3D TV in my normal 2D TV then I don’t need the 3D TV. Period.
Better sound ads in normal speakers -
Same as the above. If my normal speakers can make me differentiate how a “better” speaker will sound, I definitely don’t need a better speaker.
Air cushion shoes to bare foot running -
The shoe makers have taken us for a grand ride. All these years the focus was on “cushion” shoes – air cushion soles and what not. All this was apparently scientifically proven – that is why we paid more and more money for shoes. Apparently all that was hogwash. The latest trend is “barefoot running” – shoes so thin that you feel you are running barefoot. Also they cost more than your normal cushion shoes.
Deo/Aftershave/Perfumes -
This industry is built on creating “desirability” amongst males. Nothing else matters – if you are using the right brands of the above girls will flock to you. Except the fact that now all the above have the same advertising and hence in order to have a sure shot result it is better to apply all the ones at the same time so that at least one works. Unfortunately nothing of this sort works.
Fairness creams -
Our weakness for fair skin is legendary. Many fairness creams (for both males and females) have taken advantage of this weakness and launched products. Now there are powders available to make us look like westerners. These products are like the “garibi hataao” policies of the Congress – so many decades of implementation and no results. Same is true for the users of these products.
Good Luck medallions/rings/bracelets -
If there was ever a product category made to benefit from our insecurities – it is this. This is 2nd on the list of things that irritate me – on top are the chain mails/sms’s that if not forwarded immediately bring you bad luck for many years to come. Come to think of it – if adding or removing an alphabet to your name or wearing any of the above could change destinies then the makers of these would be rich beyond imagination and not peddling these services to make their ends meet.
While marketing helps, it can’t really support a weak product – truth eventually prevails as one can’t fool all the people all the time. See how chinks appear in the carefully cultivated image of our aspiring PM Pappu every time he opens his mouth. I hope we start to see better campaigns and some memorable ones like Hamara Bajaj, Neighbours Envy - Owners Pride and others.  
I end the week wishing the readers a happy Diwali and a prosperous festive season.
Keeping with the festive mood next week I will write on the relationship between “gyan” and “dhan”.

Saturday, October 19, 2013

Education = Knowledge = Opportunity

Education has always been a very important part of our society, well educated citizens generally earn the respect of their community. The Guru Shishya Parampara is rooted in our psyche and we pay our homage to our gurus on the pious occasion of Guru Poornima every year. I am sure we all remember some of our teachers who have inspired us to be what we are today.

Takshshila was the earliest recorded centre of higher learning in India from at least 5th century BC. The Nalanda University was the oldest university-system of education in the world in the modern sense of university. Western education became ingrained into Indian society with the establishment of the British Raj and the knowledge of English was possibly one of the good things that they did for our country.

Education is also very important for our socio – economic well being - India has seen success in the field of IT and Pharma industries because of its large educated population.

In Numbers –
We produce 50 lakh graduates every year
We produce 15 lakh engineers every year – more than US and China added together
The size of the Indian Education Industry is about Rs 3.5 lac crore now and will almost double to Rs 6 lac crore by 2015 as per a recent India Ratings research report. India's higher education system is the third largest in the world after USA and China.

Reach -
Our census puts the literacy rate at 66% - not good enough after so many years post independence.
As per the Annual Status of Education Report (ASER) 2012, 96.5% of all rural children between the ages of 6-14 were enrolled in school. 83% of all rural 15-16 year olds were enrolled in school. The challenge is now to keep these children in school and the programmes like the mid day meals certainly help.

Quality of Government run institutions -
20% of primary education is privately run whereas 60% of higher education is privately run. We know the problems in the govt run institutions – poor quality infrastructure, absent teachers, lack of motivation on the part of the teaching staff etc. Since a majority of our population (specially rural) goes to the government run schools, it is very important for their quality to improve.

World Class -
IITs and IIMs are the only world renowned institutes in the country. Their alumni today run many companies in India and overseas. There is a strong case for many more such high quality education institutes in the country.

Qualit0y of output -
While we produce a staggering number of students every year, very few of them are employable. All companies have a comprehensive training programme to train freshers every year. The quality of the students will improve once the curriculum is revised more frequently and have more interactions with the industry to gauge their demands so as to be able to adjust the inputs accordingly.

Commercialisation -
The private sector loves education. All aspiring businessmen now want to have a piece of this action and are creating more and more institutes. The potential of the sector is high – high profit margins, capitation fees and the chance of converting black money to white – no wonder most of the politicians have schools and colleges being run by them. The problem with this is the rapid escalation of costs across the industry – my friends today pay more for their kids pre school (couple of hours) than what I paid for 2 years of my post graduation – all this has changed over the last 10 years!! No one seems to mind really – education loans have become commonplace with some MBA colleges charging upwards of 15 lacs per year – I sadly think of graduates from these institutes who have a EMI burden on them before they start working.

New ways of delivery – online education -
The industry needs to innovate fast – a cost effective way to deliver education online/on mobile/TV needs to be found and implemented. There is very little possibility that those who are hungry for education would find their way into a school or a college – if the students can’t come to a school can the school go to the students?

Role of NGO’s/Training Institutes -
NGO’s are playing an increasingly important part in the industry – they reach out to students and adults and train them. Training Institutes which provide basic skills to the youth to make them employable in the catering business/shop floor/retail industry are also doing a good job.

Education builds character in an individual and hence is essential, more so in today’s world where your basic education qualification matters. One can also argue that it is not necessary -  one of our top industrialist was not even a graduate, but that was 30 years ago. In the modern world it has become absolutely necessary.

Some of the most successful people never stop learning – that is a characteristic that our education system should instil in all students – education can stop but learning should not.

Next week I will question some marketing fads – as a marketing graduate I hope that I would be able to do some justice to it.

Saturday, October 12, 2013

Healthcare industry – what went wrong and what can be done

I begin this blog with the invocation of Lord Dhanvantari, an avatar of Vishnu, a medical practitioner and the surgeon of gods.

The Indian healthcare industry comprises of hospitals, medical infrastructure, medical devices, clinical trials, outsourcing, telemedicine, health insurance and medical equipment. Potential Healthcare is the world's largest industry with total revenues of approx US$ 2.8 Trillion. In India as well, Healthcare has emerged as one of the largest service sectors with estimated revenue of around US$ 30 billion constituting 5% of GDP and offering employment to about 4 million people. Sample this -
·         We have the largest number of medical colleges in the world.
·         We produce among largest numbers of doctors in the developing world. Indian doctors work in many other countries and are considered among the best in the world.
·         We get ‘Medical tourists’ from many developed countries reflecting the high standard of medical skill and expertise here. They seek care in its state-of-the-art, high-tech hospitals which compare with the best in the world.
·         We are the fourth largest producer of drugs by volume in the world and are among the largest exporter of drugs in the world. Indian Pharma companies are feared across the world for their cost efficient production methods and competitiveness.

Since we Indians have a genetic makeup making us vulnerable to heart and sugar ailments, our visits to the doctors is virtually guaranteed. Let us look at what ails the Indian Healthcare industry -  

Avoidable deaths
We don’t value the human life in this country. A mere look at the simple ailments that cause many deaths in the country – 40,300 Indians died of malaria last year, about the same no of typhoid, 50 lakh kids die every year during childbirth (called the Infant Mortality Rate which is 42 per 1,000 births for us) and we lost about 56,000 mothers during childbirth last year - the highest women mortality rate during childbirth in the world. Very little effort can make a big difference to save so many lives, but then, who cares?

Accident victims
18 deaths occur every hour in our country as accident victim don’t get timely medical aid (the first hour is the most crucial). Do the maths – how many lives are lost each year? Let me tell you, these numbers are again are the highest in the world. But we don’t care. If we did, the courts would not need to continuously remind hospitals to admit accident victims so that their lives can be saved. Still the hospitals will not do what is instinctively the right thing to do – what’s the point if the patient is unable to pay the bills?

Too much greed
A doctor’s job is good for society.  But that was 50 years ago. Now it is a cash cow which needs to be milked as much as possible. Why not? The medical fee is so high and the cut offs so impossible that only the brightest make it to medical school. There is then the fierce competition to make money for the hospitals that you are associated with to justify the set up costs and profits. Don’t worry about your bill – just swipe your credit card or better still – there is a medical insurance to fall back on. Also the Gold Loan branch is just around the corner – in case you need to raise some quick money by mortgaging your ornaments.

Private sector – the wrong way
The motto of the private sector is to maximise profits. If hospitals are run by the private sector, don’t blame them for not thinking twice before engaging in questionable behaviour to maximise profits.
Consider this - most of the medical resources lie with the private sector - 80% of all doctors, 26% of nurses, 49% of beds and 78% of ambulatory services and 60% of in-patient care. It is naive not to exploit the dominant position. I wonder why almost all the deliveries of my friends were caesareans – maybe a couple of days more spent in the hospital is good for the hospital profits. Why would anyone complain about that, after all there is a bundle of joy to show for the “expense”. Freely recommend angioplasty and other complex procedures – who minds spending a couple of lakhs on a surgery when it might extend your life. There is a BIG case for the hospitals to be run purely on a “non profit” basis. Why should our celebrities (Mangeshkar) and business houses (Ambanis, Hindujas) run hospitals to make money? Don’t they have enough already?

Customer Centricity
I am sure that a majority of the readers will not be “happy” with their interactions with the medical practitioners. Are we all “customers” of the services offered by them? Yes. Do we feel like “customers” when we visit them? Certainly NO. I am yet to see a doctor who is on time, a 2-3 hour delay is considered normal. And I have never heard them apologise if the patient is kept waiting for hours after the scheduled appointment time, we are supposed to understand that there are emergencies and many lives of us ordinary citizens that these angels are supposed to be saving. When loved ones are admitted for procedures in hospitals, the relatives are made to sign a declaration absolving the doctors of many things. Is this not one sided? I hope the courts in the country take note – we have no choice but to sign the totally one sided declaration. This is not the way a customer – service provider relationship is supposed to operate.

Human Touch
How do you handle patients? They are suffering and need a delicate touch – not the push and the cold shoulder. Arrange for the money and only then the critical operation will be performed. Make arrangements for the blood. Sign these forms which absolve us from punishment in case the patient dies due to our mistake. The canteen is only for the patients – relatives are free to go out and eat. The waiting benches are uncomfortable? Why are you thinking of comfort when your loved one is in danger?

Five star treatment
The hospitals are now 5 star hotels and the per night room rates also match. If it was not for the sanitized smell and the presence of white coats around, you would not be able to make out the difference. The charges on the items of the bill vary depending on what sort of “room” you are admitted in. But then, not everyone can afford 5 star. What happens to the not so lucky in the society? Who decided who can pay how much for a treatment. Foreigners are welcome to be treated in our country – Indians – well what is your net worth?

Compulsory medical insurance
Each visit to the doctor is getting costlier. Each admission to the hospital can easily set you back by a couple of lacs. Everyone of us should have medical insurance – but that is not the solution. There are no free lunches in life – the insurance company will compensate you but unless the industry corrects its way, the premiums that we pay will keep going higher every year and will become unsustainable at some point of time – at the current rate – very soon is my guess.

Pharma value chain –
Companies make medicines. They have a sales force that can be seen sitting outside the doctors cabins, eager to meet them. Their job is to “influence” the doctors to prescribe their medicines over others. On offer are prizes, white goods, cars and foreign holidays. Let’s look at the entire value chain – the drug producing company makes 20%, the wholesaler 10% and the pharmacy 20 – 60% Pharmacy retailing, people in the jewellery business and agricultural middlemen are the most consistent profitable (legitimate) businesses in this country. Is the cost of this intermediation good for the society? NO

Drug prescription and pricing
We buy the medicines that the doctors prescribe. What are medicines? They are chemicals agents that are mixed together and some of them are now generic household names like Paracetamol. Generally in the markets there are more than 20 brands available for the same chemical agent. So a diabetic patient should only be recommended a chemical agent that he can buy from a pharmacist or given a choice of 5 brands to choose from instead of buying the expensive brands that are prescribed so that fat commissions can be paid to the doctors and pharmacists. The high drug costs lead to very high out-of-pocket (OOP) expenditure for the general public. It is estimated that 78% of all spends on healthcare are paid by the people and 72% of this is on drugs alone. Estimates suggest that 39 million people are forced into poverty because of medical expenditure. 

Imagined ailments, expensive prescription
The industry keeps researching new (questionable) ailments to cure and the doctors are more than happy to prescribe them. Anxiety, hypertension, sleep disorders, vitamin D deficiency, bipolar disorder and schizophrenia, ADHD, osteoporosis – latest being sweating while sleeping, the industry is in a mad rush to create new ailments and expensive drugs around the same. The new fad is combination drugs – one may not work so try a combination – dosen’t matter what effects they have on the human body. Why don’t we still have a cancer cure? (refer to my earlier blog- 10 questions that need answers). 

Is medicine science
In science you can control the output based on inputs. In medicine you can’t. Doctors say it is difficult to estimate the end result as the human body is complex and different people react differently to treatments. Most of the decisions on the line of treatment that the doctors take are based on “experience”. In earlier times surgeries were performed s a last resort on patients that had no hope of survival. Thanks to anaesthesia now surgeries are recommended performed as a routine for ailments that did not exist some years ago.  I would encourage readers to pick up Antifragile by Taleb and read the chapter on Medicine – it is an eye opener.

Government intervention –
The government spending on healthcare is grossly inadequate. We spend about 1% of the nation’s GDP on healthcare – lower than even some of our neighboring countries. Healthcare was never a top priority after independence which has led to social sectors like health and education (my next blog) being neglected. In fact, it wasn’t until 1982 that the National Health Policy was endorsed by our lawmakers. Medical education is also neglected, there are no great Indian medical institution brands like the IITs or the IIMs.
I am a strong supporter of “government should not be in business”  However there is a good reason why the private sector should never be allowed to run law and order, utilities (water supply, electricity, transport) and defence as the profit motive mentioned above will lead to the exploitation of the monopoly that these services create.
Healthcare is facing the same problems today. The private sector should run hospitals but the government should be in the dominant position and the private sector should operate on the fringes (say 80:20). The private sector should compete with the government sector in providing healthcare services – today the private sector competes with each other and this way the costs will only keep on rising. Only a significant government intervention will make a difference. I know that the majority will (rightly) feel that the government cannot run any enterprise effectively – let alone something as critical as hospitals. The other solution is a cap on the returns that the private sector can make from these businesses, let us say 20%. I don’t know which is a better solution, but one thing is for sure, things cannot be allowed to run in this way.

Need for a change and choice –
We should have a transparent choice between doctors and hospitals.
We should have a choice of brands for purchasing the medicines that the doctors prescribe.
There should be accountability in the medical profession
We should be treated as customers deserve to be treated.
Medical insurance should cover all costs – including visits to the doctor
There should be a regulator/watchdog for the industry
Government should be the leading service provider for the industry.

Disclaimer– I hate taking any medicine and going to the doctors/hospitals (like most of us) so some of this may be biased, but a lot of it is (unfortunately) true.

I also end this blog with the invocation of Lord Dhanvantari, an avatar of Vishnu, a medical practitioner and the surgeon of gods. I also hope the practitioners stops chasing only the “Dhan” in Dhanvantari. I wish all readers a Happy Dussera and pray that the industry return to the right path that they should follow.

Next week I will take the readers on a journey to take a look at the Indian Education Industry.

Sunday, October 6, 2013

Poll promises to be made and kept

Before every election all the parties vie for the attention of the voters by putting up manifestos – documents detailing the work that the party will do if voted to power. Voters should take note of the manifestos as they affect our lives. Now a days the party in power wants to cling to power at all cost and the challenging parties are often desperate to come to power as the opportunity cost of staying out of power is too high. This has resulted in the election promises going from weird to absurd – free food, free medicines, free laptops and mobile phones, regularisation of slums, free power and what not.

Today I will attempt to put forward the items that parties can promise the electorate to implement if they are voted to power. The criterion for choosing the items was simple – things which can be easily implemented but will have a profound impact on the country and will also result in winning votes for the parties - 

Abolish income tax -
How much do we collect in income tax every year – 1,93,402 cr in 2011 - 12
How many people pay taxes in India – 3.5 cr (3% of population)
What is the size of the income tax department – 43,000 employees
Size of the Indian Economy – 120 lakh cr (2 trillion dollars)
Share of services in the economy – 84 lakh cr (70%)
Tax of 10% on half of service sector will yield in collection of – 4,02,000 cr (double of current income tax collection)
The government should just abolish Income tax and introduce a tax on consumption instead.
Although this math is simplistic (we already tax some services, last years taxation was 70,000 cr) the idea of the same is to highlight the potential of taxing consumption and not income. Not only is this easier to collect and monitor (at source) but it also encourages savings which are vital for a developing country like India. It is also logical as services contribute about 70% of the Indian GDP and are growing at the fastest pace in the last 2 decades (agriculture and manufacturing contribute almost equally to the other 30%)
What happens to the staff of the IT department then? They can be merged with the service tax department to handle the increased work load of the department.

Law reforms -
Court cases in India are nightmarish. Because of the huge backlog of cases (more than 3 cr court cases are pending in various courts of the country) the judicial system is unable to deliver timely justice resulting in a cavalier approach of the people breaking the laws. It took our system 17 years to sentence Lalu Prasad to a jail term for 5 years during which he was a key supporter of the UPA government. We just cannot have so much delay in delivery of justice. This one reform itself will led to the resolution of a lot of the problems facing the country today – I have covered the topic in detail in my earlier blog – “Many problems? One solution”

Police reforms -
We all know that the law enforcement agencies are in the need of a major overhaul. We as citizens can (rightly) complain that the police is corrupt and lethargic. But lets examine the issue from their point of view – they work under lots of pressure (both political and otherwise), have long working hours, don’t get too many public holidays as they are busy protecting us, have terrible working and living conditions, their stressful lives are at potential risk every day (so is everone else’s even in a simple activity like crossing a road) but for these people it is a part of their “job description” all this and they don’t get any respect from the society (fear yes, respect no). And what are they paid for all this trouble? Sample this – for Maharashtra Police the per month pay range for a sub inspector is Rs 5500 – 7000 and for a constable is 5200 – 20200 (source These days many drivers in the private sector are paid more than this.            
“Bhookhe bhajan na hoye Gopala” is apt here. We would be fooling ourselves if we expect them to do a great job given what they are paid and what they go through every day. Let’s treble their salaries and then demand delivery – for people who don’t fall in line the courts (after reforms) can quickly decide if someone is guilty and take appropriate action.

Bureaucracy reforms -
What is true for the police above is also true for the bureaucracy. Starting from the babus to their seniors, the entire hierarchy is grossly underpaid. So let’s treble the packages again and expect to see tremendous improvements – for people who fail to deliver there would be enough people to take their places.

Social spending heads in budget
We spend over 1,30,000 crore every year for 147 schemes (plan is to bring it down to 70 schemes this year). To name a few of these schemes – Sarva Siksha Abhiyaan (budgeted spend Rs 61,734 cr for 2011 - 12), NREGS (budgeted spend Rs 40,000 cr for 2011 - 12), Rajiv Gandhi Gramin Vidyutikiran Yojna (budgeted spend Rs 6,000 cr for 2011 - 12), Mid Day Meal (budgeted spend Rs 10,000 cr for 2011 - 12). This is a utter waste of taxpayer money and a breeding ground of corruption. How can anyone keep a track of so many schemes and their proper implementation? Let the new government run only 10 scheme and tightly monitor them – once the intended benefits are realised the other priority areas can be taken up.

River interlinking –
The earliest plan for river interlinking in India was proposed in 1972.  The gist of the plan is to link the water surplus rivers of the East and North to the water deficit rivers of the West and South India. It is indeed a grand plan both in vision and the positive spin offs it can create – government spending on infrastructure will create a multiplier effect on sectors like cement, steel, capital goods, construction companies and generate productive employment for many, more land will come under cultivation, water scarcity will get solved in many areas, the waterways can be developed as an alternate way of transport, we will conserve a precious resource such as fresh water, flooding will get reduced, fishing and other activities can be created along the new rivers, power can be generated, water tables will get recharged and water levels improve in the areas where the rivers will flow from. There are too many direct and indirect benefits to ignore this project.

New ways of service delivery -
Almost everyone today has a camera phone. Thanks to cheap mobile plans videos can be uploaded and downloaded quickly. It is possible to deliver a lot of services to the people using this facility – can I upload my grievance on a website, can the citizens become the eyes and ears of the government to notify law breaking, potholes, garbage, land grab, stagnant water, bribery, waiting lists at hospitals/courts/government offices to a portal where it can be tracked and solved? Yes. Can I get the status of my requests on my mobile? Yes. Should the government start thinking of its citizens as its customers? Definitely yes.

Government landbanks –
The government holds large land banks in practically every city. Although only a few of them are vacant, most of them are occupied by crumbling structures created decades ago. There a case for redeveloping these (except heritage structures) so as to create a better infrastructure and enabling webcams, sprinkler systems and other modern office tools. Let the government make better use of its properties and the life of the people working in those structures get better.
Government hospitals -
Same applies to the government run hospitals, most of them are in a very bad shape. Let there be a massive effort to redevelop these in record time so as to provide better services to the needy. Not only the buildings but the equipments, layouts, capacity and the staff quarters. The costs of a medical problem have become so high in the past few years because of the excessive commercialisation of this industry (more of this in the next blog) that the weaker sections of the society have to depend on the government created infrastructure for the delivery of this basic necessity. Let there be more people who can avail of this service and the quality of the delivery improve.

Agricultural produce movement -
In India the agricultural and farm produce cannot freely move across the country due to a law passed in the 1954 (called the APMC act) which gives the states the power to create mandis and decide who can participate in them. It also forces the farmer to sell their produce in these mandis to middlemen. The 5 – 6 layers of middlemen that the goods pass through ensure that the good sell at least 3X the price of what they are bought from the farmers. While the states have been protecting the middlemen and the traders for decades now, never before have they been so brazen in hoarding goods and creating artificial scarcity and benefiting from the price rise (like the current case of onion prices). In the name of protecting the farmer the government is hurting both the farmer and the consumers. Today when goods can move freely across the worlds, why restrict their movement within the country, especially when the inflation rates are so high and hurting everyone?

Although the list can be much longer, I chose to focus on the high impact items here that are also vote catching. I am hoping that most of these items are a part of the agenda of the party that aims to form the next government.

Next week – medical industry – what went wrong and what can be done.

Saturday, September 28, 2013

The Dumbing down of Media

Media – the fourth estate – the pillar of democracy – the conscience keeper of the nation. These are indeed high expectations and the current state of the Indian media indeed leaves a lot to be desired.

The media is all around us both print and increasingly digital. Media plays 3 critical roles in a vibrant democracy (democracy is the important word here – in any other form of government the media merely plays the role of being the official mouthpiece) –

1.       Information – get the correct information, report the facts, prevent misinformation campaigns.
2.       Conscience keeper - Hold the mirror to the elected representatives on their promises, bureaucrats and law enforcers on their duties, guide the society as to what is happening and desirable.
3.       Take up causes – for issues of great significance, channelize the public opinion to put the correct sort of pressure on policy makers, bring the prominent public figures and the intellectuals on the same page so as to be able to educate our masses.

Let us look at what is “desirable” from the Indian media –

Lack of depth in the coverage -
I felt really let down by the token coverage on the two very important bills passed recently – the food security bill and the land acquisition bill. Both the bills (independently) can take us back by 50 years. And what did you read in the media – either the government version (Bharat Nirmaan – beats me why it is no longer Hindustan – more of that in a different blog) or the “skimming the surface” coverage that I have read in most newspapers – done by people who are too busy to spend time to study these pieces of regressive legislation and educate the masses on the real impact that these will cause.

The debates have got increasingly meaningless and the breaking news now borders around absurd –
Either we have too many news channels OR the hosts have run out of topics to ask their participants OR the Indian public sees news channels as a source of entertainment rather than information. Either ways, it’s a race to the bottom. The sooner we get there the better, at lease things won’t get any worse from there (hopefully)

Should the older unresolved topics be reignited once in a while? (my earlier blog – 10 questions that need answers) –
Sensationalism serves the media well. The problem is that there needs to be a newer, bigger story that needs to be frequently broken. And the stories that were once sensational die down – most of the without getting resolved. It may be a good idea to dig up the old graves once in a while. Public memory is short – a refresher every 3 months will be indeed useful.

Provide a platform for the eminent personalities of the society to come together for the greater public good –
Forces multiply when united. Can the personalities working for common/parallel causes come together? Can the opinion makers work together to spread knowledge through media? The answer is yes – if the medium is correct and the cause is noble.

Be sensitive and unbiased –
Know your limits. Exercise restraint and use discretion. Refrain from asking for comments from the dear ones who have suffered a great personal loss. If you have reached a place where a tragedy has occurred or is unfolding – help those affected instead of trying to cover the same live.

Show restraint- live coverage of terrorist acts/interviews of fugitives/promoting comments of foolhardy politicians (Digvijay Singh tops the list)
The handlers of the Mumbai attackers were able to guide the terrorists inside the Taj hotel about the positions of the security forces and the rescue of the people inside the hotel because of the live coverage of the event on TV.
Several operatives of Indian Mujahideen went underground because its founders Bhatkal’s arrest was breaking news on TV.
You know some leaders have a foot in the mouth disease and talk rubbish – you will still rush to them for comments – maybe if you stopped giving them so much of importance they will stop their tamasha – Lalu is a classic example.

TOI campaign for Nirbhaya/2G/Coal Scams/Ordinance against protecting tainted MP’s -  
Some recent examples of how a market leader swung into action by launching campaigns and kept up the pressure by channelizing the public support for these causes. Great initiative indeed, applause!! If you still haven’t, give a missed call on 08067730022 for a campaign against tainted MP’s retaining their seats.

Some positive coverage please -
It is difficult to believe that only bad things are happening in the society – can we have some coverage of the small acts of kindness that are making a large difference to the lives of people. I am sure there are a lot many unsung heroes amongst us and a little positive motivation will go a long way.

Great Power – Great Responsibility –
Classic lines from the movie Spider Man.
You have the power to make a great difference. In fact you are the keepers of “balance of power” the state of equilibrium that nature loves. Maybe this is because some also become power brokers – the Radia tapes have the names of some very successful anchors featuring rather in a sorry state. Use the power constructively.

The expectations are high and it is very important for them to keep the promise and deliver, given the pivotal role that they have in the society. In its current state the media is looking titillate the “dumb” masses – that is a gross misjudgement and self destructive path.

Next week – the election season is fast approaching and we will be wooed with many promises, very few of which will be kept. I would try to create a “desirable” election manifesto in my next week’s blog which would be practical and high impact for the country.