Why Do NRI Professionals Find India So Difficult ?

22 11 2016

As Indian companies want to expand overseas and become globally competitive, one often cited prescription is to get the best people particularly NRI professionals to work in India.

Some NRIs are keen to return to India for various reasons, sometimes professional and sometimes personal or both. Compensation at the top is hardly a constraint these days for top professionals.

Yet, I see from several anecdotal evidences that the NRIs who choose to return to India taking plum assignments in top corporates or even government, wish to return back and many do.

Raghuram Rajan is back to teaching at Chicago. Kaushik Basu is back to US as a World Bank Economist. The recently fired Nirmalya Kumar after being in Mumbai for three and a half years is also leaving India, though he has not announced where he is heading.

I have spoken to a few friends who chose to return back after spending a few years here and this is their gripe about India and Indian organisations.

1. Professionalism in even the so-called professionally managed organisations is a 3 Micron gold plating. Beneath the coat is feudalism, bureaucracy, nepotism and a deep seated hatred for outsiders. Factions based on state, caste, village and colleges prevail. Merit is often the casualty. Mutual respect and valuing other persons time is more an exception than a rule.

2. The families find it very difficult to navigate the daily life in India. Be it the school or the traffic or getting simple things done at home. Unlimited patience and perseverance is required. Also, one can hardly trust anyone, because falsehoods and promising more and delivering less is the norm here.

3. The high pressure school environment in India with almost total focus on academics often puts off children who started studying in a western system.

4. India is no longer inexpensive. For global class goods and services, you pay dollar prices.

Urjit Patel’s Signature in Rs 2000 Note

15 11 2016

After the demonetisation was announced, the newly issued Rs 2000 has come into circulation. The Rs 2000 notes currently being issued have the newly appointed RBI Governor Urjit Patel’s signature. urjit-patel-signature

PM Modi and FM Jaitley have claimed that the preparation and printing of currency notes were being secretly done for the last six months. This would mean the Rs 2000 currency notes should have been under printing for the last six months.

But, Urjit Patel was chosen as the RBI Governor only on August 21, 2016 and he took charge from Raghuram Rajan only on September 4, 2016, just two months before the November 8th announcement.

Something is amiss. Either, the government is lying when it says it has been printing currencies to prepare for demonetisation from the last six months or they had decided  Urjit Patel as the next RBI Governor, atleast four months before the official announcement.

It can be speculated that when Raghuram Rajan made an announcement on June 18, 2016 that he would not take the second term as Governor, already Urjit Patel’s signatures as the next Governor were being taken in the new Rs 2000 note. This could have well led to Rajan’s decision to return to academia.

Nirmalya’s Jor Ka Jhatka..Dheere se

7 11 2016

Nirmalya Kumar, a former member of the Group Executive Council of Tata Sons has written a blog post, “I Just Got Fired“. You can get the link to his post here. The post has gone viral and has appeared in many publications.

At first reading, it is a personal account of a senior person’s firing by a corporate.  By using phrases like “No pity is needed” and “ I have nothing negative to say about the Tata group” he creates an impression that this post is not a way of complaining or hitting back at his former employers who fired him. By using “I realize that I am unemployed for the first time since the age of 18 and “Well, a bit lost, and ready at 8:30, instead of the usual 8:00, I head for my morning Starbucks coffee “, he tugs the heartstrings of his readers.

He mixes up the criticisms and his emotions, so cleverly, that you only realise after multiple readings that , this post is a subtle attack at some of the popular  beliefs about Tatas as an employer and as a business group.

Let me elaborate with examples :

  • “Despite the unceremonious and un-Tata like end”

This phrase clearly dispels the popular belief that Tatas do not follow a hire-and-fire policy. A popular perception among the employee community is that a  Tata job is very secure. By using “un-Tata”, he has brought out that Tatas are not what you think. Another aspect is that Tatas are not always graceful and dignified as they appear.

  • “What I found exceptional about the group was the kind of person that Tata attracts – unpretentious and dedicated. Yes, they really drink, as we would say in America, the “koolaid” of Tata. But I observed how hard they work, and how committed they are to the group and its values. “

This to my mind is the nastiest that Nirmalya gets. By praising the average Tata employee as hard working, dedicated and unpretentious, he gets them on his side and then he says “they drink the “koolaid” of Tata”.

Drinking “koolaid”  is an expression that is a reference to the 1978 event at Jonestown, Guyana, where hundreds of members of the Peoples Temple, a Californian cult, committed suicide by drinking Kool-Aid laced with cyanide.

He is clearly hinting that the gullible employees of Tatas are blindly believing the cult of Tatas without knowing the consequences of their faith, which could be disastrous.

  • They deserve a great Chairman.

He could not have got more direct than this one. He clearly feels the current one is not good enough.

  • It was not as if I was fired for non-performance (my last evaluation was excellent).

By this statement, it is apparent that Tatas do not follow any performance management system, despite their claims of professional management. They also are not fair and just with their employees, if the person belongs to a different camp.

  • When in future anyone mentions me, please don’t say anything positive. Throw me under the bus to gain credibility in the new regime. It’s my parting advice.

This parting advice is revealing of the insides of Bombay House and the Tata culture. Bad mouthing the previous bosses and blaming those who are no longer in favour and around to defend themselves, appears to be a sure ticket to succeed.

Tatas in their web-site have said the ” Dr. Nirmalya Kumar, Dr. N S Rajan and Mr. Madhu Kannan have decided to explore options outside Tata Sons and have left the services of the company.”  By writing this post and titling it as “I just got fired” he is openly saying that Tatas are lying when they say the GEC members have left on their own, when actually they have been fired.

Forget about all the exalted Tata values and ethics, one of the basic value is telling the truth and even on that count Tatas fall short.

Nirmalya Kumar through this one post has created such an adverse impact particularly among existing and potential employees of Tata group, that it will take a lot of corporate communications effort to undo the damage.

  •  Posted by G.Mohan

Nirmalya Kumar has posted a follow-up to the above post titled “Just Fired, and Moving On”. 

Boycott TOI, Boycott Reebok

29 10 2010

“Run Delhi Marathon only if you have Reebok” could well have been the headline for a sports column in Times of India, Hyderabad edition today ( 29/10/2010),. Since it is not an advertisement and is published in Times of India, a newspaper with over 100 years history, the headline was just a wee bit subtler in   ”It is important to wear the right gear while running.” The author of the column is the cricketer Yuvraj Singh. The column is sponsored by Reebok Zigtech, a brand endorsed by Yuvraj Singh. The columnist goes on to write a full paragraph on the virtues of Reebok Zigtech. There is no disclaimer that Yuvraj Singh endorses Reebok Zigtech. The para is reproduced below

It is also important to wear the right gear while running. Reebok has recently launched the most technologically advanced running shoes ZigTech. The shoes help to reduce wear and tear by up to 20 percent in key leg muscles, especially shins and hamstrings. These shoes are my personal favourite and I feel they serve as the energy drink for my feet.

This is yet another instance of advertising passing of as a news item or an editorial in Times of India. TOI has often compromised on separating the advertising from its editorial. For the right price, it will sell anything, including its masthead. In today’s newspaper, the first page delivered a full page ad for a Delhi based developer with some false news about Govt approving FDI in retail. The look was exactly like the normal TOI first page, masthead and all. It is a different matter that the normal first page was also there actually in Page 3.

Advertisers like Reebok would like to use the goodwill of sport stars like Yuvraj and the reach of TOI, to make their brand a recommendation to the gullible Indian public (?). I am certain they pay a disproportionate sponsorship rate for such columns.

To stop being deceived, the public should boycott such products. This will hurt the advertiser and advertiser in turn will stop using such tricks. This will also hurt TOI.

– G. Mohan

The Hypocritical Succession Culture of Indian Business Houses

4 10 2010

In a recent interview to Business Standard, Kishore Biyani, the Founder and CEO of Future Group made a very controversial quote

“I don’t believe in the hypocrisy of asking family members to join at a junior level. The CEOs would run the business and be accountable; family members would set broad guidelines and manage relationships.”

There is no denying that several business families in India induct the sons and daughters at a junior level initially in their family owned company. Then they make accelerated progress through the ranks of the organization, before being appointed on the board and then eventually becoming the successor. The Bajaj sons, Ranbaxy inheritors, Birla inheritors, all have gone through this route.

The hypocrisy of this route can well be seen in the recent example of Rishad Premji, son of Wipro’s Chairman, Azim Premji.

In a 2007 article in Rediff, it was reported:

The elder of Wipro  Chairman Azim Premji’s  two sons, Rishad studied at the Harvard Busines School and graduated from Wesleyan University, Connecticut. With a penchant for software and music, Rishad sure has learnt one thing from his father, and that is to maintain a low profile.

Rishad, who is currently with Bain and Co, had a brief stint with GE before doing his MBA. His move now to join his father’s empire is interesting considering the fact that Azim Premji once said he did not want Wipro to become a family business.

Sources in Wipro maintain that Rishad will have to work his way through to the top. It is said that Rishad was keen on joining Wipro. Like everyone else, he too had to send in his resume and as luck would have it, he managed to find a placement.

Rishad will join the 70,000-employee-strong software-led conglomerate, which also makes soaps and bulbs, as a business finance solutions manager. It is also learnt that he will report to its president, Girish Paranjpe.

In September 2010, The Hindu Business Line reported :

Mr Rishad Premji, son of Wipro Chairman Mr Azim Premji, has been appointed Chief Strategy Officer of IT Business, Wipro Technologies. In a statement, Mr Saurabh Govil, Senior Vice-President – Human Resources, Wipro Technologies, said Mr Rishad Premji was till recently General Manager – Treasury & Investor Relations and brings with him a diversified experience of Consulting, Finance, Treasury and Operations. In this role, Mr Rishad will report to the joint CEO’s, IT Business.

Within three years, Rishad has moved from an entry level position to become a direct report to the CEO of the IT business. This blogger believes at this rate Rishad will be the CEO in another three years. No prizes for guessing why this movement has been so rapid.

 Azim Premji owns 85 % of Wipro and if he feels his son Rishad is his rightful successor nobody can question him. His dilemma, perhaps, is the cloak of professionalism that he wishes Wipro to project. 

Kishore Biyani has no such dilemmas. His daughter Ashni Biyani has joined directly as Director of Future Ideas and his nephew Vivek Biyani has joined as the Director of Home solutions retail.

 The second part of Mr Biyani’s quote is also very interesting where he says “The CEOs would run the business and be accountable; family members would set broad guidelines and manage relationships.” A textbook role of CEO of any company would include setting broad guidelines  and managing relationships, yet Biyani feels CEOs just stop at running the business. In other words, what he really means is Chief Operations Officers ( COO) will be professionals but CEOs and Board members will be family members. Just that, in these title fluffing times, COOs will be called CEOs, without having the role and responsibility.

Now let us look closely at what a rich businessperson running a public limited company can bequeath to his sons and daughters. He has wealth which he has by virtue of the shareholding in his companies. He can sell his holdings in the companies and bequeath the wealth to his inheritors. He can bequeath the shareholding directly to his inheritors, thereby they becoming claimants to board positions as owners. He can not only bequeath the shareholding, he can also appoint them as successors to the top job, thereby becoming owner-managers. 

A vast majority of Indian family owned public limited companies choose to bequeath their holding as well as appointing them as successor. Contrast this with what Bill Gates is doing.

Bill Gates, one of the world’s richest men, has said that he is not interested in using his billions to launch a dynasty and would not leave his fortune to his children. Gates and his wife Melinda, 44, have three children –Jennifer, 14, Rory, 11, and eight-year-old Phoebe. 

“I knew I didn’t think it was a good idea to give the money to my kids. That wouldn’t be good either for my kids or society. So the question was, ‘Can I find something that had incredible impact?’ I knew I wanted to do that,” Gates was quoted by The Sun as saying.

So far, Gates and his wife, through their foundation, have given away £18 billion which has helped deliver vaccines to more than 250 million children in poor countries. 

If Indian businessmen cannot do what Bill Gates has done, they should go by what Kishore Biyani says and spare us the hypocrisy. 

– G. Mohan

The Abuse of the Inland Letter

29 09 2009

The blue inland letter evokes warm feelings.  Those who lived in hostels would know personal letters from family and friends would usually come in those inland letters.

Private. Economical. Large enough to convey the message.

The very same virtues of the Inland Letter seen by middle-class Indian families have been discovered by the corporate India now. What started off last year as a one-off case has become the norm this year. Premium notices from Insurance companies, Dividend information, IPO allotment information, Notices for AGM to shareholders etc which earlier used to come in envelopes are now being sent in Inland Letter cards.

The Blue Inland letter instead of evoking warm feelings, now evoke feelings of disgust, reserved for junk mail.

With companies in cost-cutting mode, every rupee saved helps. Inland letter postage is Rs 2.50 as against Rs 5.00 postage for an envelope. In addition, there are savings on stationery.

The cost of delivering a letter from one-point to another in India is the same, whether it is an Inland letter or an envelope. Government through India Post subsidizes the Inland Letter postage.

When Television competitions were abusing the low cost of post-cards, the postal department came up with a separate category of postcards called competition post-cards, which was priced much higher than the ordinary post card.

As the government subsidizes the postage on the Inland Letter, the government should check this abuse and come up with a separate category of Inland Letter for Business use in a different color.

The Blue Inland Letter should get back to its original use for personal mails only.

– G. Mohan

Share Premium: An Ingenious Political Graft

23 09 2009

One ingenious method for raising money that has come to light in Andhra Pradesh is using share premium account. It is well known that the late CM’s son has business interests in the media sector. The media ventures are already operational and hence visible.  Fewer people are aware of newly floated  cement and steel companies  which are yet to be operational.

The media, steel and cement companies issued shares to the promoters, namely the family, at par. Then the same companies sold at huge premiums often 100-500x times the share value to other investors. On the strength of these investments the media business was valued at Rs 3500 crore in 2008.These investors were large real estate, construction and other AP based firms. These investors perhaps, invested large amounts of money and gave such valuations to shell companies or yet-to-be executed projects with the hope or explicit knowledge that the returns for the investment will come not from the projects per se but through other considerations. The considerations could be anything like concessional land, government contracts, tax concessions etc, which only a person in power can give.

There is nothing intrinsically unethical about issuing shares at a premium. Share valuations have an element of subjectivity. Many angel investors back greenhorn entrepreneurs, based on instinct. It is just incidental that the entrepreneur here had a very powerful father. Now, if the returns do not come through, they will be written off as bad investments in their books. If these investments have been made by public limited companies, as indeed many are, then it is the minority shareholder who loses.

–       G. Mohan

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