Waste put to good use

Promote plastic waste for use in road construction

The statement "We are sitting on a plastic time bomb" made by the Supreme Court on April 03, 2013, highlights the grave concern that is posed by plastic waste in India. For instance, the country produces as much as 56 lakh tonnes of plastic waste per annum, as per the Central Pollution Control Board (CPCB). The four metro cities, i.e. Delhi, Chennai, Kolkata and Mumbai, generate plastic waste of 689.5, 429.4 425.7 and 408.3 tonnes per day respectively. Moreover, 40% of the total waste is neither collected nor recycled; so they become a continuous source of pollution. In this scenario, the problem is likely to worsen with time as not only is there an adequate waste management system in place but worse, even the existing system does not function efficiently. But not all hope is lost. A new initiative -- of constructing roads using discarded plastic items -- offers a ray of hope in finding a solution to the problem of disposing off hazardous plastic waste.

R. Vasudevan, the Dean and Head of Chemistry Department of Thiagarajar College of Engineering (TCE), also known as Madurai's ‘Plastic Road Man', had laid the first plastic tar road within the TCE campus in 2002. Since then, thanks to the extensive research carried out by him, Bangalore University, the Council of Scientific and Industrial Research (CSIR) and the Central Road Research Institute (CRRI), New Delhi, have helped the nation to construct several trial roads using plastic waste. The Bangalore Mahanagar Palike (BMP) decided to use plastic waste over asphalt to over 40% of the roads under a World Bank scheme in 2005. Similarly, Pune constructed its first plastic bitumen road in 2011. In addition to that, Tamil Nadu Chief Minister Jayalalitha recently announced in the assembly that the state is coming up with a plan to relay 1,100 km roads in the rural and urban areas by mixing plastic waste with bitumen. Even Meghalaya might get the first plastic road in the Northeast in the near future.

What's the reason for these states taking a shine to plastic roads? Several reports and experiments have proved that plastic roads are “25% better than unmodified roads and are almost 200% resistant to water absorption. Even the maintenance cost of these roads is very low, while the durability is high. The roads reportedly need no repairing for at least five years.” Moreover, plastic roads would be an added advantage for a country like India, which has a hot and an extremely humid climate, and where torrential rains are responsible for damaging most roads.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman

ExecutiveMBA

As sales bounce back, AC playersvie to beat the sweat

In order to grab a slice of this growing market and tap new customer segments, players are rolling out products that are energy efficient, have better technology and deliver an acceptable price-performance ratio for the target customers. By Sanjay Kumar

Air conditioners (ACs) are fast becoming must-haves as consumers become increasingly accustomed to air-conditioned environments at the workplace, homes, malls, cinema halls and in their cars. With the consumer durables industry in India growing at 15% annually, and the fact that the air conditioning segment remains among the least penetrated consumer durables segments, at less than 3%, more and more players are entering the AC market with hopes of tapping the growth opportunities. The AC market in India currently has over 20 players who are fighting for a slice of the market amidst high hopes that it will grow substantially in the future.

The fact that 97% of Indian households are still untouched by room air conditioners – while the adoption of comparable products have surged ahead – indicates that industry players are far from realising the full market potential. This has led to players intensifying their efforts to grow the market and reach out to new consumer segments. But despite fierce competition and a sizeable market turnover in the room AC industry, which last year generated sales of 4.2 million units worth Rs.72 billion, there are several issues crimping the growth and potential of the industry. According to industry experts, lack of infrastructure in the form of inadequate power supply is the most important factor inhibiting the growth of the AC industry in India. “Globally, 40 to 50% of the electricity is used by buildings, and out of that 30 to 40% is accounted for by air conditioning,” says Gaurang Pandya, MD, Carrier India. High up-front costs of an AC are also a major barrier to adoption for many Indian households. This is particularly important in India where the traditional air cooler offers a cheaper substitute for households at a time when energy prices are rising. To increase penetration and accelerate market growth, AC manufacturers are now taking a leaf out of the automobile industry's book and offering easy financing and purchasing options with the view to bring ACs within the reach of a much larger percentage of the population. Trade sources say that finance-driven sales in ACs have risen by 7-8% over last year. "Last year, finance-driven sales were 22-23% of total AC sales. This year, it stands at nearly 30%," says Manish Sharma, MD, Panasonic India.

Many players are also banking on innovation and technology to lower their cost of production, which can then be passed on to the customer through a lower ticket price. In fact, several companies have introduced air-conditioners endowed with inverter technology that has a shorter motor run-time and therefore consumes less electricity. Although energy-efficient products are relatively more expensive than the standard variants, a large number of consumers are choosing them to reduce long-term costs. Sanjay Mahajan, Vice President – Sales and Marketing, Carrier Midea India, says "energy-savers, though 15-25% more expensive than the regular models, are now viewed as ‘value for money’ by Indian consumers."

AC manufacturers are also adopting the strategy of offering a portfolio of lower priced products by resorting to economies of scale and focusing on obtaining cheaper components and materials. Currently, Haier and Onida are among the cheapest brands in the Indian market but other players – mainly Japanese and Korean – are also introducing products at cheaper price points. A case in point is the Japanese AC manufacturer Daikin, which in spite of its premium tag, is trying in earnest to tap all segments of the market. "We want to tap all segments, not just the top segment of the market. We have already launched products targeting each segment. And now it is time for us to penetrate the rural and semi-urban cities of India," says Kanwal Jeet Jawa, MD, Daikin India. As part of its strategy to increase its share in the Indian market from 12% to 20% by 2015, Daikin plans to have dealers in all Indian cities with at least 100,000 population. Not only Daikin, which claims the No.1 position in the global air-conditioning market, other Japanese AC makers such as Panasonic and Hitachi have also made a strong inroad into the bulging AC market in India over the past couple of years.


According to industry sources, both Panasonic and Hitachi have maintained a steady growth in the AC market and cumulatively account for more than 15% of the market currently.

The past fiscal year, which saw the overall AC market in India post a negative growth of 26% year-on-year, was particularly bad for the Korean majors Samsung and LG. The market share of LG dropped to 17.3% in February 2013 from 26.3% in March 2011. Samsung's market share, too, dipped to 11.3% by February 2013, from 19.5% in March 2011. On the other hand, the share of home-grown Voltas increased to 18.3% in February this year from 17.5% in March 2011. The company has attributed its latest growth to aggressive marketing of its new all-weather air conditioners introduced early last year. But its success has deeper roots than that. Over the past five years, Voltas has built its brand, introduced new products and expanded its retail presence to a total of 6,000 outlets. Fast-growing smaller towns and cities now contribute about half of Voltas’ sales and the company sees them as its main source of future growth.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman

ExecutiveMBA

What after mandela?

South Africa risks sliding back into recidivist politics

"For as long as he lives, South Africans breathe a little easier and believe in their country a little more. When the day after Mandela dawns, that belief will be shaken, not dramatically or immediately, but slowly and perhaps imperceptibly. South Africa will, quite simply, be a different country." That was British Prime Minister David Cameron’s message in the Telegraph, echoing the fears of world leaders about the possible unraveling of South Africa's racial harmony once the charismatic and healing presence of its tallest leader is no more. There are speculations, not only in the South African media but even elsewhere, that in the absence of Nelson Mandela’s guiding principles, the country could once again descend into apartheid politics.

The apprehension is that Blacks would vent their anger and frustration against the Whites. There is a simmering discontent  against the white community lording over 80 per cent of the country’s wealth. Till now, Mandela's spiritual and moral authority had had a calming influence. But once that authority is gone, repressed emotions could come to a head.  It is debatable whether the current political leadership can be counted on to keep fissiparous forces from taking over.  Even Ernst Roets, the Deputy Chief Executive Officer of AfriForum, has expressed his anxiety on the issue. "We do get calls from people saying they're scared about the day Mandela dies and what they should do. There are fringe organizations that say flee the country."

The fear, though speculative, is not altogether chimerical. There are hate messages doing the rounds of social media. "You guys just wait until the day Mandela dies and then we'll come for you," reads one such threat. A cursory trawl of the Web throws up many such minatory hints. South African whites are reading the tea leaves and taking necessary precautions. There are reports that Whites are building bunkers and stocking food to meet any eventuality. They fear that the restraint that has so far been exercised by black rabble rousers will cease to exist after Mandela.

Such apprehensions may still prove to be unfounded.  After all, many tribal clans and communities in South Africa have had their outlook and weltanschauung shaped by Mandela's sterling legacy. To expect them to disown those principles in a jiffy would be heretical to Mandela's ideals and reputation.  Also, the country now has a vibrant democracy in place, with strong institutions enshrined. In fact, the post Mandela era could pave the way for some ground-breaking political shift in the African National Congress Party, which has been the political bulwark for South Africa's blacks but has struggled to grow out of Mandela's overpowering influence. While new leaders with a modern outlook and vision could come into their own in the ANC, Mandela's exit could also spawn other political formations for the country's blacks.  Global experience shows that multiparty democracy is always a better option.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face

BBA Institute

Small films, big gains

Mumbai directors who followed their hearts and fought a dour, unflinching battle to protect their cinematic vision from market-imposed dilution have come up trumps at the 60th National Film Awards. The Sunday Indian analyses why ‘Bollywood’ movies that are not made for the 100-crore club are really the only ones that are worth celebrating

The 60th National Film Awards announced on Monday, more than anything else, have come as a strong vindication of the efficacy of independent cinema that blends the need for entertainment with a spirit of creative adventure. Nowhere is that truer than in the case of the healthy complement of Hindi-language films that have been adjudged worthy of being feted by the President of India.

The value of the National Film Awards stem primarily from the fact that they aren’t, as a rule, influenced by extraneous commercial considerations or the crowd-pulling capacity of the reigning movie stars, which, incidentally, are the two principal pillars on which all the Mumbai cinema-dominated, made-for-television award shows firmly stand.

The National Awards are meant to recognize excellence in Indian cinema – and that, barring stray aberrations, is exactly what they do. This year has been a perfect demonstration of what sets these awards well apart from the all the other glitzy star-driven events that are avowedly about showcasing the biggest and the brightest of the industry and not necessarily about celebrating cinema for its own sake.

Hindi, Malayalam and Marathi cinema have cornered the lion’s share of the major National Awards this year, with cinema in the national language securing a greater presence on the honours list than usual.

Tigmanshu Dhulia’s critically acclaimed Paan Singh Tomar has been adjudged the best film of the year gone by. The film’s male lead, the redoubtable Irrfan Khan, has won the best actor. Nothing could have been better for Hindi cinema – the two awards for Paan Singh Tomar are not only richly deserved, they provide a fillip to filmmakers who, while staying within the parameters of the Mumbai movie industry, desire and strive to carve their own niche.

The jury, in its citation, has lauded Paan Singh Tomar for its “sleek and sensitive handling of a not-too-common subject with remarkable aplomb”. Indeed, unwavering authenticity of location and lingo is the prime strength of the film, which narrates a gritty tale of the eponymous athlete-turned-brigand whose brief run from the law in the ravines of Chambal ended in dusty death in a police encounter in the early 1980s.

It certainly wasn’t easy for Dhulia to bring to the screen the compelling story of an ordinary villager, soldier and steeplechase champion who was forced by rural oppression and lack of redress to take up arms against the law.

The director worked on the idea for close to a decade, researched his subject thoroughly and, when he eventually got down to filming, he shot on actual locations, including the places in Chambal and the barracks in Roorkee where the real Paan Singh Tomar lived.

After it was wrapped up, Paan Singh Tomar languished in the cans for a year and a half for want of takers despite the critical applause it earned at festivals around the world. The film finally hit the screens in March 2012 and instantly garnered both critical accolades and commercial success. The rest, as they say, is history.
Recognition for Paan Singh Tomar at the National Awards is also recognition for the kind of culture-specific and rooted cinema that the Mumbai film industry has all but abandoned in its unthinking pursuit of big box office returns.

Significantly, all the other Hindi films that have won National Awards this year have emerged from independent spaces where funds weren’t plentiful and star power was barely available. These films swam against the tide with intent: one revolved around a heroine who is heavily pregnant all through a narrative set in Kolkata, the other dealt with the travails of a young sperm donor in Delhi.

Neither Kahaani nor Vicky Donor left any stone unturned to capture the essence of city that it was set in, even resorting to hit-and-run guerrilla filmmaking methods (especially in the case of the former) to shoot scenes on crowded streets and bylanes. Despite being fictional stories with dramatic twists, both films had a real feel to them.  

In both Kahaani, which has fetched director Sujoy Ghosh the best original screenplay award, and Vicky Donor, which has been named the “best popular film providing wholesome entertainment”, the script was supreme. The actors, outstanding as they were, had to play second fiddle. It was cinema that was the ultimate winner.
Indeed, who would have imagined that a film about a guy who works for a fertility clinic with little-known actors in the cast would go on to conquer all manner of scepticism and score big at the box office and in the critical ratings? An unqualified triumph for director Shoojit Sircar, Vicky Donor also fetched two best supporting actor awards – for Annu Kapoor and Dolly Ahluwalia. What a story that!

The jury noted that Vicky Donor is “a wholesome entertainer presented in a breezy and humorous fashion” and went on to praise the filmmaker for “deftly avoiding falling into the beaten track of formula films”.

Kahaani was definitely no less. Vidya Balan may have been beaten to the best actress prize by Usha Jadhav (who won for her powerful performance in the Marathi film, Dhag), but the suspense drama, whose editor Namrata Rao won a well deserved nod from the jury chaired by veteran filmmaker Basu Chatterjee, proved that there can be no substitute for artistic integrity.

The director made no compromises with his vision – the refusal to kowtow to demands of the marketplace served to make Kahaani a huge success story that it eventually became. The National Awards are only the icing on the cake.

It is significant that all the three Mumbai-based directors in question – Dhulia, Ghosh and Sircar – dared to follow their hearts in a movie industry where it is customary for superstars and big banners to call the shots and determine what kind of cinema gets into the distribution chain. These directors are among those that are spearheading a much-needed revolution and the National Awards for their work is proof that they are well on course.

Read more.....

Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman

ExecutiveMBA

Obama administration on the domestic as well as the international stage

Not much changed for the US in 2012. Obama stays President, Republicans continue to control the House of Representatives and Democrats retain their hold on the Senate. While American citizens should continue to hope for a lot from the Obama administration on the domestic as well as the international stage, but what they will actually get in 2013 may be much less
A comprehensive program to increase economic opportunity and reduce inequality is also needed – its goal being to remove, within the next decade, America’s distinction as the advanced country with the highest inequality & least social mobility. This implies, among other things, a fair tax system that’s more progressive and eliminates distortions and loopholes that allow speculators to pay taxes at a lower effective rate than those who work for a living, and that enable the rich to use the Cayman Islands to avoid paying their fair share.

America – and the world – would also benefit from a US energy policy that reduces reliance on imports not just by increasing domestic production, but also by cutting consumption, and that recognizes the risks posed by global warming. Moreover, America’s science and technology policy must reflect an understanding that long-term increases in living standards depend upon productivity growth, which reflects technological progress that assumes a solid foundation of basic research.

Finally, the US needs a financial system that serves all of society, rather than operating as if it were an end in itself. That means that the system’s focus must shift from speculative and proprietary trading to lending and job creation, which implies reforms of financial-sector regulation, and of anti-trust and corporate-governance laws, together with adequate enforcement to be able to ensure that the markets do not become rigged casinos.

Globalization has made all countries more interdependent, in turn requiring greater global cooperation. We might hope that America will show more leadership in terms of reforming the global financial system by advocating for stronger international regulation, a global reserve system, and better ways to restructure sovereign debt; in addressing global warming; in democratizing the international economic institutions; and also in providing assistance to poorer countries.

Americans should hope for all of this, though I am not sanguine that they will get much of it. More likely, America will muddle through – here another little program for struggling students and homeowners, there the end of the Bush tax cuts for millionaires, but no wholesale tax reform, no serious cutbacks in defense spending, or significant progress on global warming.

With the euro crisis likely to continue unabated, America’s continuing malaise does not bode well for global growth. Even worse, in the absence of strong American leadership, longstanding global problems – from climate change to urgently needed reforms of the international monetary system – will continue to fester. Nonetheless, we should be grateful: it is better to be standing still than to be headed in the wrong direction.

Read more......

Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

 

For More IIPM Info, Visit below mentioned IIPM articles

 

IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman

ExecutiveMBA

Lack of connectivity and inadequate mechanization

A raft of infrastructure issues is affecting the growth and prospects of our ports. In the face of capacity constraints, lack of connectivity and inadequate mechanization, ports are burdened with excess traffic they can’t handle

The total available capacity at Indian ports during FY2012 was 1,172.93 MT while the total projected traffic for the same period is expected to reach 876.7 MT as per the National Maritime Development Programme. This translates into a Berth Occupancy Factor (BOF) of 74.7%. Going by the recommendations of the Major Port Development Plan prepared by the Port of Rotterdam, this is more than the acceptable berth congestion level. Against the ideal BOF of 60-70%, as recommended in the Plan, a majority of Indian ports operate with wavering BOFs. In 2010-11, while ports at Haldia, Vishakapattnam, Paradip and JNPT had an average BOF higher than the prescribed 70%, those at Cochin, Chennai, Goa, New Mangalore and Mumbai fell below the 60% threshold. Only Kandla port fell into the perfect mix of occupancy with an average BOF of 69.95%.

Non-adherence to the prescribed BOF levels directly impacts the efficiency of ports, something that Indian ports seem to be deeply plagued with. Another indicator of inefficiency is the cumulative average turnaround time for ships entering major ports of India, which aggregates 4.67 days. This is phenomenally high when compared to the turnaround time at the Singapore port, which is less than a day. While the delay in turnaround time can still be explained away as a result of large vessels needing more evacuation time, the tardiness in the matter of pre-berthing directly points to shoddy infrastructure and lack of ample berthing space at the ports. The fact that such pre-berthing delays were a regular feature throughout the year shows that there is an urgent need to undertake capacity expansion at the earliest. In order to quicken turnaround time as well, there is a need to have greater use of mechanization in the evacuation process rather than relying on conventional methods.

The practice and prevalence of conventional methods for port operations have been the bane at most Indian ports. In the case of Paradip port, it’s the inability to adopt modernisation that has bestowed on it the dubious distinction of having the longest turnaround time amongst Indian ports. Between FY2009-10 and FY2010-11, while the availability of modern wharf cranes at Paradip port increased from 75.3% to 95.23% during the period, its utilization rate increased by a meagre 0.3% from 20.85% to 21.15%. The situation was no different in the case of forklift trucks - while being available for use 97.21% of the time during the year, they were used only for 3.69% of the time that they were available. This sorry plight of low utilisation of modern machinery goes to show that Indian ports, instead of moving forward towards modernization, are still stuck on using tedious and slow conventional methods.

Even the Ministry of Shipping, which is the nodal agency for framing the policy agenda for port development, has not been able to spur port operators to adopt greater levels of efficiency and productivity. Its lackadaisical attitude towards port management is reflected in the fact that the MoS accepted less than appropriate target levels for performance improvement of ports. The only port to show some performance worth speaking of has been the Jawaharlal Nehru Port Trust (JNPT), which reported utilization rates above 60% and availability above 90% in 2009-10. No wonder that amongst all Indian ports, JNPT is India’s busiest container port, accounting for over 55% all Indian containerised cargo traffic.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

 

For More IIPM Info, Visit below mentioned IIPM articles

 

2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year

BBA Management Education

MERGERS & ACQUISITIONS

A host of companies have sold their stakes out in distressed situations in the recent past.

Another hallmark case is that of Xstrata. It took quite a while for the mining giant’s CEO Mick Davis to convince his shareholders of the value proposition in the company’s merger with Glencore. Shareholders felt that the Xstrata management had not sold the deal to them adequately. In fact, when they finally approved it after bitter negotiations, they voted for a deal that ensured that a planned retention payment of around $200 million to top Xstrata officials was not made! Finally, the $32 billion merger deal was approved by shareholders on November 20 this year after Glencore raised the ‘price’ to 3.05 Glencore shares as opposed to 2.8 – the transaction finally created the world’s fourth largest mining behemoth. The deal was done in the wake of declining commodity prices and falling demand from India and China. Financially, Glencore’s shareholders have less to complain. The combined entity will have a D/E ratio of 42% by the end of 2012, while Glencore would have the ratio at a huge 96% on a standalone basis as per BMO Capital Markets!

While many had applauded Google’s iconic $12.5 billion acquisition of the struggling Motorola Mobility – a deal that was completed in May 2012 – the financial results round the corner have been far from a scream. Mobile devices sales of Motorola crashed for the quarter ending September 2012. at $1.78 billion, 26% less compared to the same period last year. Moreover, the quarter’s losses have increased to $505 million, up from $41 million in the previous year – killing for Google by all standards.

And who can forget the United-Continental episode. United and Continental were America’s 4th and 5th largest airlines respectively. Stung by low cost airlines and struggling with their respective business models in the recessionary period, both decided to become one. Their $3 billion merger, which was initiated on October 1, 2010 (and which, officials mention, will be completed by end 2012)created the world’s largest airline by revenues and the 3rd largest by fleet count. It is well documented that aviation mergers, more often than not, tend to complicate things. Interestingly, the two had attempted to merge even in 2008, when Continental walked away owing to United’s poor financial health. United cut costs and improved its cash scenario over the next two years and the two entities got back to the negotiating table. In the interim, the United board led by Chairman Glenn F. Tilton even commenced talks with US Airways, in a move that is perceived to have been made to influence the Continental board to take the decision faster. Operationally, the merger had many disastrous consequences. Even a simple task of having a common online booking platform led to mass chaos. United is also facing trouble on the financial front with a combined loss of $103 million in the first three quarters of this year; ironically when most other large US airlines are showing profits.

The deals mentioned above were supposed to be the exemplar highlights for the M&A sycophants, peddling a straightforward ‘sellout or blowout’ punchline to companies gasping for breath. Clearly, the iconicity of these deals has had more spots than was boasted of by the brady bunch on the Street. Do such deals, then, really work?

Read more....

Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year

BBA Management Education

RIP: Fannie Mae, Freddie Mac, 2012

The recent changes in bailout agreements indicate that the Federal Government is now gearing up the process to end the era of mortgage giants Fannie Mae and Freddie Mac. But is it the right time? Is the US housing market ready to accept this and move on with the reform process to a new system? An analysis of why this is essential.

The United States government couldn’t have been clearer on this. The latest changes to the US Treasury bailout agreements with government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac clearly indicate that it’s just a matter of days when the official words will be out to wind them up; the process has started though. As per the changes made to the agreements, the mortgage finance giants have been asked to turn over all profits to the government and wind down their large investment portfolios at 15% per year rather than 10% as stated earlier. Result: The US government would soon take over all business controlled by the two GSEs for which it has been acting as the primary guarantor since both the institutions announced bankruptcy in 2008. The fact is that when the US government decided to continue the two agencies after bankruptcy, everyone knew that sooner or later they will be asked to shut their shops. They only existed because the government wanted them for reviving the distressed US housing market. Now, when the government looks decisive, the question remains, has the US housing market stabilised enough to say goodbye to Fannie and Freddie? It’s a point worth exploring besides understanding how the two mortgage giants have contributed to the overall US housing scenario.

The story of Fannie Mae is certainly interesting in this regard for the fact that it was commissioned in 1938 after the Great Depression provide the necessary impetus to the US housing market as a part of the New Deal (a series of economic programmes enacted in US between 1933 and 1936). Interestingly, it was this mortgage giant that ended up initiating the second biggest financial crisis ever. In fact, by the time Global Financial Crisis started (in the second quarter of 2008) Fannie Mae and Freddie Mac (the younger counter art of Fannie Mae was commissioned in 1970 to give competition to the former) had been exposed to subprime/Alt-A loans worth a mind-boggling $388 billion and $392 billion respectively. Certainly, considering that the annual Private-label Mortgage-backed Securities issuances remained at over $800 billion per year in 2005 and 2006, one cannot say that these GSEs caused the crisis, but they for sure were the biggest contributors. Perhaps this was what prompted Senator John McCain to say that “the catalyst for this housing crisis” was Fannie Mae and Freddie Mac. In one of the debates during the Presidential campaign in 2008, he had claimed that these two GSEs “caused the subprime lending situation that now caused the housing market in America to collapse.”

However, with the taxpayers owing close to 80% of the two GSEs post bankruptcy, the onus was on the government to use them to reorganise the US housing market. And as it can be seen, the job is done, at least to some extent. After long, the US housing market seems gaining legs. What is more interesting is the fact that now it’s in a situation where people have started looking forward to it as a growth driver. Agrees Celia Chen, West Chester based Senior Director at Moody’s Analytics, as she tells B&E, “Housing, once the Achilles’ heel of the US economy, is starting to look like a source of strength in a recovery that has lost its vigor and faces significant roadblocks. That housing is now a bright spot speaks more about the weakness of the recovery than absolute strength in housing.” This comes as a relief at a time when the other drivers of growth are faltering. Housing is about to turn from being a drag on the broader economy to being a driver. 

Read more.....

Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

 

For More IIPM Info, Visit below mentioned IIPM articles

 

2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face

B&E Indicators

Inadequate logistics network

Logistics infrastructure is a critical enabler of India’s economic development. Recognising this pivotal role, India has tripled its logistics infrastructure spend from $10 billion in 2003 to over $30 billion in 2011. However, despite this increase, the country’s logistics network remain insufficient. Still seven corridors along with some national highways handle 40% of road freight traffic even though they are less than 0.5% of the Indian road network.

Relies excessively on roads

India’s roads account for a higher share of freight traffic compared to other continental sized countries like US and China. In fact, India’s dependence on roads is more than three times that of China. This is despite the fact that a large part of the country’s freight traffic comprises bulk material and moves over long distances that can be more economically served by rail and waterways.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

 

2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face

Can he be a change agent for his party?

Keeping in mind the mood of the electorate, which has become increasingly clamorous for change and development, Akhilesh Yadav appears to be going about in earnest giving his party a much-needed makeover.

Way back in the 1980s two Young Turks set out on a mission to transform Indian politics. One of them was Ajit Singh - the America-returned son of Chaudhary Charan Singh (aka kisan neta), the former Prime Minister of India. A computer engineer who spent 17 years in the US, Ajit made Baghpat his pocket borough, travelling the length and breadth of the constituency. He went all out to court the youth and dreamt of bringing about a massive change in the state’s political scenario.

The other young man was none other than former Prime Minister Indira Gandhi’s son, Rajiv Gandhi. A Cambridge University alumnus, Rajiv became a beacon of hope for the educated youth of the country.

Both Ajit and Rajiv went on to achieve huge success in terms of winning thousands of followers. Most still fondly recall Rajiv while Ajit Singh, now a Cabinet minister in the UPA government, is known as one of the most opportunistic political leaders of our times.

Flash forward to the present and there is an unmistakable sense of déjà vu. Once again we see a young duo trying to change the political scenario of the state. One of them is Rajiv’s son, Rahul Gandhi, and the other one is former UP chief minister Mulayam Singh Yadav’s son, Akhilesh Yadav. Both are ‘foreign educated’.

Recent months have seen Rahul take upon himself the challenge of resurrecting his party from the state of political wilderness in which it has been moldering since 1989. In a bid to revive his party’s challenge in UP and galvanise an otherwise moribund party apparatus in the state, Rahul has undertaken numerous stump tours and has been organising party and public meetings in different parts of the state. The Gandhi scion, in his campaign speeches, has repeatedly harped on the issues of employment and development and has talked of transforming the fortunes of the state if his party is voted to power. And though Rahul has staked his own political credibility in the polls most political observers are not very optimistic about Congress’s chances. But that has, however, not prevented senior Congress leaders such as Pramod Tewari from claiming that the Congress would be able to win majority on its own.

Though both Rahul and Akhilesh have their own challenges to face, the latter’s task seems more difficult. As the State President of the Samajwadi Party - an outfit accused of promoting casteism and sometimes even called the ‘goonda’ party. - not only does he need to change the party’s image, he also needs to bring it back to power. Sanjay Lathar, National President of Samajwadi Yuvjan Sabha and the man in-charge of Akhilesh’s political campaign, says, “We have the largest number of youths and females contesting the elections. About 122 of them are highly educated first-timers and 75% have held positions in student unions. We have also created history by giving tickets to 40 women.” According to Lathar, the party was approached by about 50 candidates with muscle power. “Around 30 to 35 of them would have won the elections. Yet the party decided not to embrace them,” he added.

Read more......

Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

 

2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face

B&E This Fortnight

INTERNATIONAL

BUSINESS, ECONOMY & FINANCE
He end of Gaddafi

In what will probably be remembered as a landmark event in the history of dictatorships, Muammar Gaddafi, the man who ruled Libya for 42 years was captured, beaten ruthlessly and finally killed on October 21, 2011, as he tried to escape with his convoy. Although it is not clear how the tyrant was murdered, videos shot by bystanders and interviews of eye witnesses reveal the disturbing events which led to his death. Most of the videos circulating on the internet are graphic in nature and give an extremely violent account of his death. The entire drama led to an intervention by the US Secretary of State Hillary Clinton, who has even suggested a possible enquiry into the incident given its chaotic nature. However, the more important question is the risk of a power struggle, primarily because Libya has the ninth largest oil reserves in the world. According to data released by the CIA World Factbook, the country produced 1.789 million barrels of oil a day before the unrest started. This accounted for roughly 25% of the GDP. In the aftermath of these events, oil production has fallen to 400,000 barrels a day. More importantly, even if Libya does manage to restore production, it is not enough to fulfill the employment needs of all Libyans demanding jobs. The developments need to be closely monitored by the US in order to establish a healthy democratic system..

The netflix syndrome

‘Strategy’ has turned out to be one of the most alluring and elusive business terminologies ever conceived. What Apple has achieved through strategy, HP has destroyed. In yet another case of a strategically and financially sound company getting it wrong, Netflix has almost undone what it had managed to do over the past several years. A few weeks back, Reed Hastings, co-founder and CEO of Netflix, announced that he would be splitting up the company into two parts. While Netflix will continue to provide streaming service, the DVD rental business would be christened Qwikster. The idea has been hailed by some and criticised by many. The poorly introduced pricing and service alterations ended up upsetting customers. In fact, analysts are estimating that Netflix might have lost as many as 600,000 US subscribers since July. The announcements did not alienate the customers of its live streaming service who continued to opt for the $7.99 monthly rental plan. The backlash came from subscribers who were used to receiving DVDs in red envelopes. It appears that they perceived the streaming service as a free add-on. Now, the CEO has suddenly decided to backtrack on the plans. How the company will regain lost ground is still a question, but this was a very bad move on the part of Hastings (no wonder he’s on the board of Microsoft).

Read more....

Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

 

For More IIPM Info, Visit below mentioned IIPM articles

 

2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face

Global top 10 debt analysis

The top 10 indebted nations of the world are the countries who are currently struggling from the financial downturn. While US tops The list in terms of absolute value, japan stands out in terms of debt to gdp ratio. Though raising of the debt ceiling by the us has already triggered a fear of double dip recession, there are others as well who are giving the world sleepless nights.

Everybody knows it

The raising of the debt ceiling by the Obama government followed by S&P’s downgrade of US treasury bonds says it all. With the country now sitting on top of a debt pile that is a notch higher than its GDP of $14.7 trillion, the largest in the world, the global economy is now teetering on the brink. But the gradual escalation in debt, which has been happening for over a decade before it just shot up to $10.5 trillion in 2008 after a $700 billion bailout package, doesn’t seem to be taking a breather. IMF forecasts US debt will increase to $15.15 trillion by 2015. Obama’s ratings have apparently fallen to the lowest ever. If one could prove a negative correlation of his ratings with debt, would that motivate him enough to reduce US debt?

Do the world like japan

If the US showcases the highest national debt, Japan is not too far behind with a total debt of 1,055.54 trillion Japanese Yen ($13.75 trillion using exchange rates prevailing on August 17, 2011). Considering the current sensitivity of the global financial market, the impact of the dire fiscal position of Japan could be felt worldwide as it is also capable of creating a domino effect on the sovereign debt front. The country has so far been able to save itself despite a huge debt load since the days of the real estate bubble burst (early 1990s). Also, a major reason why the country is still not considered to be in a financial-crisis mode is that it owes most of that debt to itself. Moreover, IMF forecasts Japan’s debt will grow at a slower rate than the US.

Read more.....

Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

 

For More IIPM Info, Visit below mentioned IIPM articles

 

2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face
IIPM – FLP (Flexi Learning Program)

Search for The Next ‘Hundred Zeroes’!

Technology Companies are setting up VC funding Arms, Raising optimism of a Great Inorganic Leap forward. Seriously, aren’t corporate venture funds already too overrated?

When Google founders Sergey Brin & Larry Page decided to take up VC funding of $12.5 million from Kleiner Perkins Caufield & Byers in 1998, they told the VC firm’s partner John Doerr that they were willing to hire an outside CEO, but they backtracked a few months later; saying they would like to go on their own. They were then taken by Doerr to meet a number of CEOs like Andy Grove of Intel, Jeff Bezos of Amazon & Steve Jobs of Apple to really appreciate what a CEO’s job entailed. Finally, they relented on the outsider proposition, provided the outsider was Steve Jobs and no one else, before finally being convinced to explore further!

Considering Steve Jobs’ iconic personality and a high probability of a clash of equals, that may not have been a genuinely good idea. But this anecdote from Steven Levy’s book titled In the Plex: How Google Thinks, Works & Shapes Our Lives, really underscores how Google’s founders never really were comfortable letting their baby being run by anyone but themselves. The inevitable happened this year, when Page took the reins as CEO and Eric Schmidt became Chairman. Page already is talking about taking Google back to its start up days when it comes to the culture of innovation.

They have always been concerned about the company slowing down on growth. Levy mentions that they once fired all the middle managers for that! In fact, though not all may take such extreme action, that reflects a genuine concern of technology companies beyond a certain size, as they risk getting blown over by the next disruptive technology in a dynamic industry. This fact has proved true for companies like Microsoft, Yahoo!, HP, BlackBerry, Dell, IBM and Google itself, to an extent. Apart from a number of initiatives to get the company on the innovation drive again, which include working on book search and autonomous vehicles, one of the Google’s most ambitious moves is with respect to its VC firm Google Ventures, which has earmarked $200 million to fund promising start up companies (touted as a move to find the next Google?). That’s significantly large by VC standards and Google claims that it has a special secret algorithm that can help it find what the next big start ups would be. Apart from Google itself, a number of big technology names are on the list of corporate venture funds like IBM, Intel, SAP, Microsoft and National Semiconductor. But how successful can this VC model led by technology companies be?

Read more.....

Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face
IIPM – FLP (Flexi Learning Program)

B&E This Fortnight

INTERNATIONAL

BUSINESS, ECONOMY & FINANCE

Japan Upbeat on M&As

Taking a giant step towards shaking off the slump bedevilling the Japanese industry, pharma giant Takeda and nuclear reactor manufacturer Toshiba have decided to lead the nation’s aspirations for cross-border takeovers. The unprecedented earthquake has taken a heavy toll on the entire nation, shrinking the Japanese economy by more than 3.7% for the first quarter Y-o-Y. So, realising that they can’t survive on domestic business alone, Takeda agreed to take over pharma company Nycomed, which gets most of its revenue from emerging markets, for $13.7 billion, whereas Toshiba agreed to shell out $2.3 billion for buying Landis+Gyr, a Swiss electronic-metering company. Taken togther, the two deals account for a whopping $16 billion. Japanese companies have traditionally followed the policy of hoarding cash, especially in times of economic distress. But now the thriftiness is being shrugged off as more Japanese firms now scout for across-the-border acqusitions. Boosting the M&A wave further are big firms like Mitsui Sumitomo Insurance Co, which has readied plans for the acquisition of Indonesia-based PT Sinar Mas Multiarta’s life insurance unit for $818 million; another company, Sumimoto Mitsui Financial Group Inc has been in talks to buy 25% stake in Malaysian Financial lender RHB Capital Bhd for $1.6 billion.

Symantec’s purchase

Symantec Corp, makers of Norton, the popular anti-virus software will acquire Clearwell Systems, a privately held database specialist firm, for $390 million in an all cash deal. The deal is expected to close in the September quarter. With this move, the world’s No. 5 software maker is aiming to shore up its storage and cloud computing capability, and become a key player in the data discovery market. Symantec has said that Clearwell’s eDiscovery tools will help its Enterprise Vault eDiscovery system and also the other cloud-based database. Clearwell specialises in ‘electronic discovery’ or the categorising/processing of data, a market that Gartner estimates will be worth $1.7 billion by 2014. Law firms are increasingly relying on such IT companies that can archive and search massive troves of court documents, which simplifies the vital discovery process and cuts down on time and costs otherwise spent on painstaking staff work. Symantec disclosed that the purchase would dilute adjusted earnings by 1.5 cents per share for the 2012 fiscal, and is expected to add to fiscal 2013 earnings. Symantec shares held steady around $19.57 in after-hours trade following the announcement.

Read more....

Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist). For More IIPM Info, Visit below mentioned IIPM articles

2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face
IIPM – FLP (Flexi Learning Program)