More lethal, Virulent strains

Coronavirus and H7N9 are the latest to emerge

Another deadly strain of virus is gaining notoriety among the medical fraternity across the world. Its name is Coronavirus and its lethal manifestations have already become a hotly discussed topic among medical practitioners and across health forums in the Middle East. The virus was identified in Jeddah, Saudi Arabia, only last year. But in recent months it seems to have travelled afar, making its baleful presence felt in European countries like Britain and France, especially among people who have been late visitors to Gulf countries. Though the attack of the virus has so far been mostly confined to countries in and around the Middle East, there are apprehensions that a serious outbreak could erupt in the near future. The World Health Organisation (WHO) has found that “Coronavirus can be passed between people in close contact,” making people highly susceptible to the virus.

As per the WHO, the virus has already taken 18 lives in the Middle East and Europe. Around 34 cases of Coronavirus infection have been registered across the globe on the basis of blood tests so far. But that could be the tip of an iceberg as there is a huge probability of several such cases having gone ignored, as awareness about the virus is still very low. Most governments and their health establishments are still clueless about the virus and its implications. But the concern that the virus could touch off a global pandemic is not unfounded. Given the genesis and geography of its provenance, several reports have highlighted that the possibility of the virus travelling outside Saudi Arabia is high as the country is expected to witness a huge flux of pilgrims during October for Hajj. Intermixing of people is sure to increase the chances of this virus spreading its wings beyond the originating country.

As with Coronavirus in the Gulf, another virus called H7N9, a new bird flu strain, is creating panic in China, leading to the deaths of 32 people so far. Both these new viruses have the potential to touch off a global pandemic. In the past, policy neglect has led to pandemics fanning across the world. A decade ago, SARS (severe acute respiratory syndrome) emerged from south China and spread to Hong Kong before going on to engulf the whole world, including America, Africa and Europe. Delays in taking action by the local public health authorities allowed the virus, which was initially confined to just one country, turn into a pandemic and create global havoc . Between November 2002 and July 2003, SARS claimed 775 deaths worldwide. The virus spread the way the Coronavirus and H7N9 are emerging today before becoming virtually impossible to control at a global level.]

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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

Is Apple losing the plot?

Angry investors and bad press have done Apple much damage. Can CEO Tim Cook do anything to pump some pride into what was until recently a mammoth $658 billion-worth corporation? By Steven Philip Warner
Five months into his tenure at Apple, Tim Cook invited a select group of Apple’s shareholders at the company’s conference center at 4 Infinite Loop building. The idea was to get those investors to understand the company and its new CEO better. In their few and many years as Apple investors, the shareholders had never believed, seen or heard of a calm Apple CEO. Jobs wouldn’t have bothered to entertain a lot of dozen-odd investors, out on a ‘bus tour’ of Apple’s campus. That summer (in August), Apple became the world’s most valuable public company ever (with an m-cap of $623 billion), beating the previous best of $620 billion set by Microsoft in 1999. But that’s when the dream ended.

The past half-a-year has earned Cook a bad name. Today, Apple is battling where it used to crush.


Disappointing reviews of its new launches – MacBook, Siri, Apple iMap – and some grossly misguided HR strategies (like the hiring of John Browett as Head of Apple’s Retail business and his firing in 9 months flat, and the firing and rehiring of Scott Forstall, the man behind the Siri and iMaps fiascos and one who was responsible for failing to make the iOS 5 and iOS 6 seem upgrades to the previous iOS versions) have weighed heavy on Apple’s stock price.

Cook is trying hard to regain lost ground. What is not true is that Apple is dying soon. Each day of his tenure, Cook has added $117.33 million to Apple’s m-cap. In the six quarters gone by, the company has reported a growth in its quarterly revenues and earnings on a y-o-y basis. The topline achieved in the most recent quarter ($54.51 billion; Q1, 2013) was the highest ever in the history of the company. In his year as CEO (FY2012), Apple’s revenues grew 44.58% y-o-y to touch $158.51 billion. Good numbers.


Cook realises that he has made mistakes. If the Siri and Apple Maps were jokes, the launch of the more expensive, thinner iMac, and the iCloud (that works only as well as Maps does) are areas where Cook will have to reinvent.

The form factor and lack of innovation with the iOS 6 introduced on the iPhone 5 and the hardware of the iPhone 5 are two other chapters from which he could dig out a lesson or two. Cook needs to understand that on the OS front, it has to fight with open source forms. One bomb is Android. So what should Cook do? In more ways than one, under Cook, Apple needs to open up. Within 12 months of his becoming CEO, Cook launched the 7.9-inch iPad mini that was 33% smaller and priced about 25-40% less than the iPad. Result? In Q1, 2013, the iPad mini outsold the original tablet 3:1. Today, tablets contribute to 20% of the company’s topline. The same magic needs to be repeated for the iPhone. This needs introduction of larger screen phones and lower-priced models that would give the company more market power in fast growing telecom markets like China and India. There is more to the introduction of the low-priced iPhone – a move that would prove beneficial for Cook and the Apple stock. The low end iPhones that Apple would deliver would call for margins of about 38%. That would be lower than the current 50%-levels that this category contributes, but would have dual benefits of making the company competitive in a tough environment and not dilute earnings at the same time. The right thing for Cook to do would be to introduce such a mid-range quality product at the $320-$340 price range (a low-cost 3G device, with at least 8GB of memory and a hardware similar to the iPhone 5). The low-end iPhone would be an indication if his claim is true.

Additionally, such an introduction would give rivals sleepless nights. As per Credit Suisse, this introduction would also help the iOS capture 40% share in the $300-$400 market. If Cook delivers the low-priced handset soon, when Gartner comes out with its market share findings in Q4, 2013, Apple’s share amongst smartphones will read between 24-28% (currently 20.9%).

In December last, of the 60-plus analysts covering Apple, only one rated Apple’s stock ‘Short Sell’ (as per Bloomberg data). Cook knows that most in the investor community believe it when they hear the sky is falling. It’s over $400 billion-plus in value he puts to risk each time. Cook cannot underestimate competition from Samsung – which is the smartphone leader today and threatens Apple’s dominance in smartphones. Its Galaxy S IIs, S IIIs and the newly launched S4 and the Notepads are ways for the users to consume larger screen phones. Apple could also replicate the Note’s multi-window home screen. It has been Samsung’s best user interface to date. It wouldn’t hurt Apple.

On the OS front, there is much work to be done still. Working along the lines of offering fresh user interface skins with each OS released, offering services web apps (to users who want to access Facebook or Amazon, or YouTube, rather than having to get into the App Store each time), or even doing something similar to Microsoft’s Live Tiles interface (that provides updates from web services to users without bothering to open apps) could be a start. Cook has to self-disrupt the closed world of iApps to an extent.

Finally, there is a big PR problem that Cook has to deal with. And it all starts with flamers and fanboys offerings concerns about Apple’s lack of innovation. At present, Apple spends the least on R&D and absolute terms amongst all bluechip Silicon Valley giants. It spent 2.2% of its topline on R&D in FY2012, as compared to Google, Cisco, Microsoft & Oracle – all of whom spent in excess of 10% of their revenues on R&D. Cook could divert a couple of billion dollars more into his labs and avoid another Maps or Siri debacle.

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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

Battle station Delhi

The bonhomie between the people of India and Pakistan has been cut short with the killings at the LoC. Can the tension spark off a larger conflict? Ranjit Bhushan looks at the options

In retrospect, Pakistan Interior Minister Rehman Malik's recent trip to New Delhi now seems like a distant little joke. All his ridiculous utterances paled into insignificance after the decapitation of two Indian soldiers on the Line of Control (LoC) by Pakistani Army regulars along with their terror cohorts, the globally banned Laishkar e Toiba (LeT), on January 8.

In one stroke, all the good work done by diplomats, Track Two specialists, peaceniks, cultural exchange wallahs, sporting icons and the mass of common people was undone. A process which had gathered momentum as never before with the most people-to-people contacts on a sustained basis since 1947, certainly got someone's goat. Not too difficult to guess who it was though, as India pointed its finger at the Pakistani Army – after all who resides in the LoC?

The killings sent shock waves of anger as gory details emerged, prompted by a belligerent opposition demanding heads in return and shrill TV anchors equally vocal on asking questions on behalf of the 'nation'.

The impact was immediate – and visible. Pakistani hockey players who were in India to play in the Indian Hockey League were packed off home, a liberal visa regime for Pakistani elders was stopped hours before it was to be launched at the Wagah border, a visiting women's cricket team from Pakistan looked all set to return and the many weekend parties and dos meant to showcase this newly-found Indo-Pak bonhomie in Delhi, Mumbai, Hyderabad and other places came crashing down like a pack of cards.

While Opposition ranted and railed, the Indian Army let it be known that a counter-hit would take place at “a day and time of their choosing.” Army Chief General Bikram Singh exhorted his army commanders to hit the enemy hard and not be 'timid' while placing their shots.

For some, the latest rocketing of tensions and its unpredictable outcome in the days to come is a worthy end to Prime Minister Manmohan Singh's affair with Sharm-el-Sheikh, where India made undue 'concessions' to Pakistan in the desert expanse. Says BJP's Arun Jaitley, “The major lapse at Sharm-el-Sheikh was to delink action on terrorism from the Composite Dialogue Process. This can be considered a huge set back for India and I hope that the current development will be an eye opener for the UPA government.”

The incident confirmed how tenuous the peace is between the two south Asian neighbours. For those in Rawalpindi –  the Pakistani Army's headquarters – who see peace between the two countries as anathema, it does not take much to undo years of hard work, back-channel diplomacy and intricate labour; a beheading like this is all that it takes to snuff out the peace pipe without breaking a sweat.

The Indian government has so far reacted soberly, even though Western diplomats based in Delhi attach much importance to the statement of Prime Minister Manmohan Singh who said that post the Mendhar killings, “it could not be business as usual” between the two countries. That, ironically, was signal enough for the others to follow suit with even the BJP saying the “PM has sensed the public mood.”

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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

In pursuit of happy capitalism

Policies should be directed at making the environment for entrepreneurship far more enabling in India than what it is today. However, entrepreneurs must also contribute to the larger social goal in their own interest

Eight out of the world’s top ten richest people on the Forbes’ The World’s Billionaires 2011 List are self-made, that is, people who have not simply inherited their fortunes, but have built them over time due to their entrepreneurial vision, exemplary leadership and years of hard work. And of course, a huge majority in this list hails from the US, a country that has successfully nurtured the spirit of entrepreneurship since ages; and is also the nation with the highest GDP in the world. These people are the perfect embodiments of leadership, who inspire millions to live their dreams and make them a reality, even in the most unfavourable of circumstances. But there is something more compelling that these entrepreneurs manage to achieve. Through employment generation and equitable wealth creation within masses, these entrepreneurs contribute immensely to nation building and to the subsequent upliftment of disadvantaged sections.

In other words, it cannot ever be overstated that promoting entrepreneurship is absolutely essential for progress – and more so if it’s the case of India that we’re discussing. The Economic Survey for 2011-12 laments that while India is the world’s 4th largest economy, it is also the poorest among G-20 nations in terms of per capita income, which was around $1,527 in 2011. It has been also estimated by the World Bank that India has more than 400 million people living below the poverty line; UN confirms that more than 700 million Indians live on less than $2 a day. These figures are shockingly mammoth.

Entrepreneurship could very well be the only real hope for India to create virtuous cycles of employment to ensure that a massive majority of these disadvantaged classes are uplifted in quick time. If China could manage this kind of a feat, then I fail to understand why can’t India? Between 1981 and 2004, China got more than 600 million people out of poverty – this is more than has ever been achieved by any nation in history. UNDP data estimates that the incidence of rural poverty in China went down from 30.7% in 1978 to 1.6% in 2007. These electrifying improvements correspond to the spectacular rise of Chinese manufacturing and the growth of hundreds of thousands of Chinese entrepreneurs throughout the nation – and all with the proactive support of the State, which ensured continued public-private coordination throughout this growth story.

Leave the macro story, even at the micro/corporate level, promoting entrepreneurship – even within an organisation – is critically essential, The most respected Peter F. Drucker strongly believed that no organisation can dream of being stupendously innovative unless its employees are die-hard entrepreneurs; warriors who live and die with the consistently burning desire to start something new! If I were to expansively summarise the import of his iconic book Innovation and Entrepreneurship, Drucker defined an entrepreneur as an innovator and vice versa. Indeed, that key character trait that separates these entrepreneurs and innovators from the rest is ‘passion’. In a path-breaking May 2007 official Microsoft research release (‘The Rich Have Money – And Passion’), the Harrison Group, a leading international research firm, showed how 70% of America’s big family fortunes are less than 13 years old (that is, they’re not ‘inherited’) and more importantly, that “the people who amassed those fortunes are primarily entrepreneurs – risk takers for whom wealth is a by product of pursuing their passion!”

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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

IndiGo wants to win through discounting

Kingfisher is desperate for cash flow. Spicejet is aiming at market share. Jet desires to get back to its old profit-making habit. IndiGo wants to win through discounting. And Air India is simply paralysed. In such an unstable environment, will the formation of a cartel to control price satisfy the varied agendas of our aviators?

That demand hasn’t shrunk is good news for conspiring airlines – the purpose of cartelisation is being served. But airlines argue otherwise. Their claim – fair pricing strategy is being followed, no union has been formed to cheat fliers, and the overall increase in fares only happened because two airlines Kingfisher and AI have shed weight. [In the first 9 months of 2012, KFA’s flight count fell y-o-y by 65.19% and AI’s 39.31%.]

They have a point. A reduction in supply causes price to rise for market to be in equilibrium. And that is one reason why prices have skyrocketed since January this year. In the nine months leading to September 2012, the number of departures fell y-o-y by 28.45% (to 421,883), and the number of seat units supplied fell by 25.74% (to 58,880,373). How much of the price increase does this fall in supply justify? As per the paper titled, ‘An Airline-Based Multilevel Analysis of Airfare Elasticity’, by Castelli, Pesenti & Ukovich, the price elasticity of supply (frequency) is 0.862. Another study by Jorge and Calderon, titled, ‘A Demand Model for Scheduled Airline Services’, puts the figure at 0.79 to 1.26. Giving airlines the benefit of doubt, we take 1.26 as our figure. Calculations prove that as supply gets reduced by 25.74%, prices could rise by 32.43%. Market dynamics does therefore explain a significant portion of the price rise. Blaming airlines of colluding to fix price isn’t sufficient an argument.

Those who argue that cartelisation is in vogue in the Indian aviation industry might also want to consider the rise in count of players. As compared to a decade back, we have double the number of airlines today (eight), which makes cartel formation less likely. Adds Gordon Bevan, VP, UM Aviation, to B&E, “Cartels are most effective when there are fewer players. There are too many players at present in the Indian airline circles for them to conform to a cartel pricing regime.” There is too much to gain by the profitable market leaders by pricing competitively rather than throwing a cartel-style lifeline to those that really need price stability. Ask yourself – why should a SpiceJet or an Indigo provide KFA or AI an extended period of competitive relief?

There is the claim that FSCs are influencing the LCCs to set floor prices, which creates very little difference (less than $9 in some routes) between their entry fares. At present, LCCs account for 55.74% of the flights that operate on domestic networks across India (during Jan-Sept 2012), and 59% of passengers (September 2012). In short, LCCs dominate the Indian skies. How are FSCs arm-twisting the dominant no-frills lot into fixing their fares? Difficult to believe.

There is another argument that strongly goes against any possibility of a cartel in operation in India. Of the two airlines that made profits last year and are expected to make money again this financial year, both are LCCs. Had the FSCs been involved in fixing prices, they would have applied sounder mathematics to ensure their bottomlines do not bleed. Instead, it is the influenced group (LCCs) that is experiencing a positive cash flow. What manner of cartel is this that does not profit the supposedly ‘powerful, influential’ side?

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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

"It is one of the ideas I am most proud of"

Dr. Li Ka-Shing doesn’t really need an introduction. With a net worth of $25.5 billion, the Hong Kong business magnate has built one of the greatest business empires. In this interview, he speaks about the goals of his charitable giving and the role of his gifts in transforming lives through learning

Can we reflect a bit on the idea behind the Li Ka-Shing Foundation? It would be great to have some insight regarding your motivation to set up an independent foundation, and perhaps about the particular aims that the foundation’s projects have tried to further. You have referred to it in the past as your ‘third son’ Li Ka-Shing (LKS): It is one of the ideas I am most proud of. Maybe even the idea I am most proud of. I had made donations before [the Foundation was set up in 1980]and giving had been part of my life ever since my companies had achieved enduring success. But, I was worked over by thoughts about what would happen if times would turn bad and cash would be tight and scarce, and by the fact that without a system and an independent entity that implements it, this philanthropic work could not develop and grow on its own. Running a business is difficult work and takes a lot of time and attention, and there are additionally many temptations which could lead one away from the hard work that philanthropy requires. Then, early in the morning, I had the thought of creating the Foundation and thinking about it as a ‘third son,’ an independent, autonomous entity that would pursue its mission, stay true to its course and have the resources to do so.

The ‘third son’ metaphor is particularly suggestive for Asian cultures – educational, even.

LKS: That is true. In fact, I refer to the Foundation as a ‘him’ in some of my messages, to reinforce the imagery of personhood. It is a powerful metaphor in a culture where wealth is passed predominantly along family lines. Thinking about an instrument for doing social good as a child – as your child, in particular – focuses you as the giver on building an entity that is robust, one that has inner strength.

It is relevant that the over-arching goal of the Foundation is ‘to promote a culture of giving’ for which the Foundation itself is a paradigm example?

LKS: This is true. There is an example in the act of setting it up, especially in a culture in which these organizations are unusual. But, the Foundation tries to develop and nurture a culture of giving within its projects as well. For example, we have built and are supporting hospices for terminally ill cancer patients in China. To date, we have built 42 hospices that care for 20,000 terminally ill patients every year, enabling them to spend their last days in comfort and dignity.

I sense a strong commitment, a bias, even, towards projects – such as the hospice for the terminally ill and the surgical cleft lip and palate repair centres that address, and redress slights to human dignity. Would you agree?

LKS: I do feel a special commitment to helping people lead their lives in dignity. As is often the case, it relates to a personal experience. I was 15, and my father had passed away a year earlier. A relative whose circumstances were even direr than mine and who was having a very difficult time making a living in Hong Kong said that she needed to bring her children back to Chaozhou. I gave her enough money for food for her whole family during their long boat journey back to mainland. This was a heavy burden for me at the time, as I was poor, and had to work hard to support my own family. But she had no one to turn to except me. On the day that they were to depart on the ship, she came to me, crying. She said that all the food they had prepared for the six-day journey had been stolen. I had no other resources. But I felt compelled to help her. So, I took the clothes that my father had left behind and pawned them for cash. It was my first and only time in a pawn shop. I took the cash, bought food, and returned to the pier only to see that their ship had just raised the first sail to set off. I hired a sampan to go after them, but a sampan is no match for a sailboat in terms of speed, and we fell farther and farther behind. But, I noticed that everyone on their ship had gathered on one side, waving to me and yelling something I could not understand. I was too far away to hear what they were saying. The ship finally raised all three sails and gained greater speed. We went after them for over an hour to no avail. Finally we had to give up and turn back. I was certain I had disappointed my relative and I felt heavyhearted. Later, I received a letter from her. She had returned to her home village. She said that my attempt that day to catch up to them to give them food had touched the captain and all the passengers. They all shared their own food with her family. My attempt had gained her their respect. The passengers on the boat were shouting at me to go back because they wanted to let me know that they would themselves take care of my relative and her children. They took care of her, because they saw that she was cared for by someone else. This episode will always stay with me. It shows how care can restore and even create dignity, which, once created, begets more care.

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

B And E This Month

share price
The world in thrall of Apple’s magical success
Nothing succeeds like success and the stratospheric rise of Apple’s shares in recent months defy the laws of business gravity. Its share price has been on a steroidal sprint ever since Apple became the world’s most valuable public company back in August, elbowing out long-time rival Microsoft from the tech pedestal. After the company announced its earnings for the first fiscal quarter of 2012, its share price picked even greater velocity, climbing 22% over the past three months, and sending its market cap gyrating above $650 billion. The past few days have seen its share price ascend to heart-stopping vertiginous heights, climbing over $700, in large part hopped up by the blockbusting sales of iPhone 5. Estimates say Apple would have sold between six and eight million units of iPhone5 in its first weekend on the shelves. So maddening has been the demand that over two million units sold out in the first 24 hours of its launch and they has been vanishing faster from shop shelves than would woolen sweaters from Antartica. Some analysts are predicting that the iPhone5 could eventually drive the price of Apple stock to a staggering $850 in the weeks to come. Apple’s stock price will have to to climb to $1067 for the company to hit a trillion dollars in market cap. If the success of its iPhones are an indicator, Apple can well keep marching ahead and sew up 30-60% of the mobile computing market, which seems like the easiset and fastest route for the company to touch the one trillion dollar milestone. If Apple becomes the first company on the planet to reach that goal, it would indeed be the most befitting tribute for its legendary former CEO and founder Steve Jobs.

on the hunt
Brazil could be its next big playground
China’s Lenovo Group, the world’s second-largest PC maker, will be buying out Brazil’s largest domestic PC manufacturer CCE. The deal is estimated around $150 million. Brazil is a promising consumer market where Lenovo will also be able to retail mobile phones and televisions as part of its growing product line. The company recently announced plans to build a $30 million factory there. The acquisition will also help Lenovo climb to third spot in PC sales in Brazil from the current seventh position. Many Chinese tech companies have set up base in Brazil like Foxconn, which has installed a local manufacturing facility to make phones and notebooks. Lenovo also plans to invest $100 million in research and development in its Brazilian facility over the next five years. The Brazilian technology market for smartphones, TVs, notebooks, PCs et al is worth roughly $124 billion. China continues to be Lenovo’s biggest market with 42% of sales coming from there, but due to slowing growth there, the company is rapidly scaling its operations in the fast growing and promising BRIC (Brazil, Russia, India, China) markets.

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

TRAI: A woeful downslide

The Indian telecom sector’s current situation merits a more progressive line of thinking from the regulator to ensure that the sector continues to progress on the government’s stated agenda of inclusion. But TRAI’s recommendations for 2G auctions and spectrum refarming would actually end up achieving more of the opposite.

In July 2012, India’s mobile GSM subscriber base reached 679.05 million from just over 1 million in 1998 through just voice services for the most part. And by that time, CDMA subscriptions had reached around 230 million (AUSPI). This stupendous growth in subscriptions has been a revelation of sorts globally, along with the surprisingly low price points at which Indian telecom players are providing these services. From an ARPU of Rs.362/user/month for GSM players in December 2005, the figure has declined to Rs.100/user/month in March 2011 as per a PwC report. The report further highlights that India’s ARPUs are around 3 and 10 times lower than developing and developed countries respectively on an average.

However, the recent trends point to trouble in paradise. For a sector that is already struggling with low ARPUs, slowing penetration and high debt, the last straw would really be a lack of appreciation of its achievements and insensitivity towards its pressing issues. But unfortunately, that insensitivity is real, and it is coming from none other than the regulatory authority TRAI. By proposing a spectrum reserve price of Rs.36.22 billion per MHz on a pan-India basis in the 1800 MHz. band for the 2G spectrum bidding process planned in November, the regulator is imposing a burden that only serves to undo much of the good that has been achieved by the telecom sector in the past.

In February this year, the Supreme Court quashed all 122 licenses that were given out during the A. Raja regime, and TRAI came up with its revised recommendations as per the SC’s directions. The price it has proposed has united an otherwise intensely competitive industry against what they term as an atrocious figure. The price is 10 times higher than the benchmarks used under A. Raja. And at Rs.180 billion plus for 5 MHz, it even beats the 3G auctions that took place last year, where the reserve price was Rs.168.28 billion (and they were globally declared as atrociously overpriced!). The regulator has stuck by its argument and asserts that the new reserve price will impose a relatively insignificant burden on end consumers. Later on, the industry got some respite as an Empowered Group of Ministers (EGoM) panel led by then Home Minister P. Chidambaram brought down the reserve price to between Rs.141.11 billion Rs.151.11 billion for 5 MHz. on a pan-India basis. But players are far from satisfied. The level of competition this time around for the re-auctioning process is not as bullish as it was when the first auction was carried out. One has to keep in mind that licences of most of the telcos are up for renewal soon. Also, they would not be exempted from paying for the spectrum they gain through any source (direct buying via auction or M&A activity). Thus, the incumbents are feeling reluctant to join the bidding process. The same goes for the relatively new operators in India, for their investments have really not paid off well. TRAI is assured of 2-3 big telecom players participating in the process, but it already seems that the top circles may not see significant participation due to high prices.

There are legitimate reasons why such exorbitant pricing will do little more than providing some short term gains to the government. TRAI has gone on and on discussing how the price will have limited impact on the balance sheet and the impact will in fact come further down over a period of 20 years. But Franco Bernabè, Chairman, GSMA and Chairman & CEO, Telecom Italia Group, cautions with respect to the TRAI decision, “Efforts to squeeze money out of mobile operators for some perceived short-term gain will only reduce investment in networks, inhibit growth of mobile services and drive up consumer prices – limiting the value that the public will derive from spectrum resource in the long term.”

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

No more the good guy

E. coli is now declared a human hazard as scientists are observing a discomfiting link to bowel & colon cancer. The world must act.

Beware! E. coli is a dire human threat now. Research done by medical scientists in Britain has revealed that the primary cause of one of the most common cancers is the E. coli virus.

As a matter of fact, Escherichia coli (commonly known as E. coli) happens to be the most studied organism in the world. It is a very complex group of gut bacteria that’s found in all warm-blooded animals including humans. The general theory and empirical evidence till date postulated that the bacterium was mostly harmless. This bacterium has even been deemed in some past studies as being essential for the survival of human beings and cattle as it helps to digest food. But recently, medical tests have revealed that E. coli might be the main cause of bowel/colorectal cancer (a disease which claims 600,000 plus lives a year, as per WHO’s International Agency for Research on Cancer). Tests have indicated that E. coli bacteria are more prevalent among bowel cancer patients than otherwise. A germ being the root cause of cancer may seem uncommon. However, it is not totally out-of-place, as it has been proved beyond doubt that there are living viruses that cause cervical cancer and bacteria that lead to stomach cancer.

E. coli reportedly has genes that are poisonous and lead to DNA damage that is common in cancer. However, it is not a sureshot cause of food poisoning and can remain dormant in the bowels with no ill effects. But the recurrence is high in patients. This is reflected in a study published in Journal Science. A sample size of 21 taken from bowel cancer patients revealed that two thirds of them were carriers of this bug; whereas among healthy individuals, that rate is just one-fifth. Experiments on these lines are carried out extensively on mice. They also show that bowel cancers are much more frequent when the bacteria with a particularly DNA damaging pks gene is present in the body.

It is also suspected by researchers that E. coli is a carrier of colon cancer, and its involvement is deeper than previously thought. Professor Jonathan Rhodes of Liverpool University is studying this with keen interest, and opines from his own analysis, “The bottomline message is that there seems to be a strong association between a type of E. coli and the development of colon cancer. And given that this type of E. coli is specifically able to damage DNA and inflict the sort of damage you get in a cancer, it is very likely that it has a causative role, at least in some patients.”

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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 the Dragon execute the ‘soft’ landing?

The world views with mixed feelings of awe, admiration, cynicism and even some apprehension, as the Chinese Communist Party undergoes a transition in leadership in August, as is customary in the country once in ten years. The 18th National Congress is now widely expected to see Xi Jinping and Li Keqiang as the new President and Premier of China, replacing Hu Jintao and Wen Jiabao respectively, a process which should be culminated by early next year.

It would be a gross understatement to call this the end of an era, besides the fact that it was the first peaceful regime change witnessed by the People’s Republic of China (Mao’s last years saw the Cultural Revolution accompanied by large scale violence and the end of Deng Xiaoping’s regime was marked by the infamous Tiananmen Square protests and subsequent military intervention). In the period since Hu Jintao first took over as General Secretary in 2002 and today, China has given the term ‘superlative’ a new meaning.

In 2002, China had a GDP (current US $) of $1.45 trillion, over 1/7th of US GDP of $10.59 trillion. The picture is starkly different now with Chinese GDP (current US $) at $7.29 trillion in 2011, which is a little less than half of US GDP of $15.09 trillion. Even in GDP per capita (PPP, current international $) terms, China has grown phenomenally, from $2,866 (less than 1/12th of US GDP per capita) to $8,442 (more than 1/6th of US GDP per capita). Net foreign assets (current CNY) have swelled from CNY 3.17 trillion to CNY 25.09 trillion. FDI (net BoP, current US $) has also surged from $46.78 billion in 2002 to $124.93 billion (2010). In 2010, China led the world in terms of exports of merchandise goods, which stood at $1.57 trillion (growth of 31% yoy) in value, and it cornered a share of 10.4% of global merchandise exports.

However, there is a catch, and a very critical one, and we are not talking about the malaise in China’s key export markets. Analysts have long argued that China’s ‘hard culture’ led by a one party top-down system will ultimately come face to face with its inherent limitations. This was evident to the world when Hu Jintao faced a massive rally from an estimated 4,00,000 protesters (as per the organisers) on his Hong Kong visit on July 1. They were protesting against the manner in which Hong Kong was run and also the way in which new Hong Kong Chief Executive Leung Chun-ying was appointed. In China, too, social unrest has been increasing quite alarmingly with rising social inequality. The Gini coefficient has breached the 0.47 mark, which is greater than 0.4, the accepted trigger for social unrest in an economy. The Chinese Academy of Governance estimates that the number of protests in China have doubled from 2006 to 2010 to 180000 incidents, which are over issues like corruption, forceful land grabs, Tibetan autonomy and environmental issues. The general mood is towards better people representation. Wen Jiabao himself commented last year, quite tellingly, that the Chinese government needed to embrace more democracy and implement wider political reforms to prevent the nation from descending into a chaos similar to the Cultural Revolution, which could undo much of the gains that the country has made over these years.

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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

An OPEC disaster moment!

Last month, for the first time in history, Saudi Arabia failed to control OPEC’s discrete members. The June OPEC meeting couldn’t reach consensus – and such a situation has happened only once before in history. For whatever it’s worth, OPEC’s cartelized unity was important for the global economy and oil stability. What now?

“It was one of the worst meetings we’ve ever had. We were unable to reach an agreement.” That’s how Saudi Oil Minister Ali al-Naimi described the 12-member Organization of Petroleum Exporting Countries (OPEC) meet that was held in June this year. The meet concluded with fissures emerging within the group. On one hand, Saudi Arabia, along with Kuwait, Qatar and the UAE, proposed an increase in group crude oil output by 1.5 million barrels a day to 30.3 million barrels a day; while on the other hand, member countries including Iran, Libya, Angola, Ecuador, Algeria and Venezuela warned OPEC of near-term collapse of oil prices. Critically, and dangerously, this is the first time that Saudi Arabia has failed to control the group! This diplomatic disaster gets further complicated when you consider the abysmal fall in OPEC’s market share over the last 6 years from 65% to 35%. The meeting ended sans consensus for the second time in OPEC’s history (the first instance was the meeting in the 1980s during the Iran-Iraq war)!

There seems to be a new power equation forming with Saudi Arabia on one side and Iran on the other. Interestingly, the member countries on Iran’s side have more oil reserves compared to member countries supporting Saudi Arabia. Venezuela (a prominent member of Iran-led group in OPEC), for instance, has more than 500 billion barrels locked under their part of the earth – around twice that of Saudi Arabia!

A close analysis reveals a pro-West and anti-West split. Undoubtedly, Saudi Arabia, Qatar, UAE and the likes would love to increase oil output to keep their dominance high and collect as many ‘petrodollars’ as possible. The other group is conceived to be a firm believer of an anti-West philosophy with Iran in the lead. As is known, US has imposed strict sanctions on Iraq and has very fragile terms with Libya (after NATO’s attack) and Venezuela (where US has imposed sanctions against state-controlled oil companies). These nations are more worried about international oil prices and demand-supply dynamics than America’s diktats. Moreover, for the first time in 36 years, Iran (the second largest oil producer in OPEC) was unanimously chosen for the presidency of OPEC last year. As a part of the rotation policy, the

baton has been passed to Iraq (a member of the Iran-led group) this year. This gives the Iran-led group an opportunity to defy US and its allies.

Moreover, the new hot spots of oil exploration across the world are threatening OPEC’s business at large. For instance, the Athabasca Oil Sands in Canada are estimated to have 1.7 trillion barrels of crude bitumen, out of which a large chunk is exported to US every day. Similarly, Jubilee Field in Ghana has reserves of more than 500 million barrels of oil; French Guiana recently found 700 million barrels of oil within their territory, the Aldous field of Norway is said to have 1.2 billion barrels of recoverable oil reserves and Mozambique discovered 7.5 billion barrels of oil in 2010.

Interestingly, OPEC, which has 78% of global oil reserves, produces only 35% of oil supply; while non-OPEC countries who possess 22% of global oil reserves, produce more than 60% of oil supply! Shockingly, OPEC collectively produces lesser oil now than it used to produce in the 1970s! A Wikileaks cable quotes Al-Husseini (former Executive Vice President for Exploration & Production, Saudi Aramco) thus, “It is possible that Saudi reserves are not as bountiful as sometimes described and the time line for their production is not as unrestrained as Aramco executives... would like to portray.

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

Can JSPL keep its global expansion plans on track?

Jindal Steel & Power Ltd. (JSPl) has reasons to cheer as it has been able to deliver growth in profitability for the past fiscal when the entire sector has been facing severe margin pressures. But in the midst of environmental and regulatory hurdles back home and an unfortunate debacle in Bolivia, can the company keep the investor sentiment bright? Ashish Kumar of B&E undertakes an insightful visit to the company's Raigarh plant and interacts with senior officials on how they plan to keep the growth story going
When you land on the airstrip of “Jindal Airport” inside the three million tonne per annum capacity integrated steel plant of JSPL at Raigarh, the first thing that strikes you about this once sleepy town in the state of Chhatisgarh is the visible abundance of yellow metal. And no, we don’t mean gold, but the numerous yellow coloured JCB machines and cranes that keep the town bustling 24/7, a sight unimaginable over two and a half decades ago.

As is the norm with industrial townships, the plant area stands out as an island of affluence relative to the surrounding area, and the company has painstakingly endeavoured to provide its employees with every possible facility. In fact, to further secure their commitment, the company provides stock options to all employees, from the topmost official in the plant to the driver who took us around the area. However, the influence of the company on the town is quite evident when you talk to the locals around, so much so that a sizeable number of them prefer to deposit their hard earned money with JSPL for safekeeping, rather than with the five odd bank branches in the area! While the Jindal Hotel in Raigarh has no relation to the group (just a case of clever branding), the town has a state of the art auditorium set up by the company, where locals can watch the latest movies. JSPL has also provided mobile healthcare vans, among other facilities, as a part of its drive to ensure harmonious relationships with the community there. So far, their land acquisition drive in the area has been successful (read: no major flare up, even though all locals haven’t accepted the compensation/R&R/employment terms), making it rare in a milieu wherein numerous projects have been stuck in land acquisition controversies.

However, there are some very serious stakeholder issues that JSPL hasn’t been able to maneuver its way through as well. It faces the ire of the Coal Ministry due to delayed development of the Jitpur coal block allocated to it in Jharkhand (along with 29 other companies who got coal mining blocks). Their proposed 5 million tonne per annum steel green field project in Jharkhand is stuck for quite sometime due to this. Moreover, while the company has taken several initiatives to minimise environmental degradation like making bricks and cement out fly ash and planting some 3 million trees (initiatives that were visible in and around their Raigarh plant), it has also come under close scrutiny of the environment ministry for beginning construction work in the non-forest area for the Angul steel plant in Odisha, before the forest area was cleared by the ministry. In addition, the National Green Tribunal cancelled the environmental clearance for their coal & washeries plant in Chhattisgarh, as it claims that the public hearing of the matter was not conducted in the right way. Land acquisition issues have similarly cropped up with regard to the Rs.350 billion steel plant project in the West Midnapore district in West Bengal. Commenting on the issues, N. A. Ansari, whole- time director and executive director, JSPL Raigarh laments, “Lack of clear cut policy measures has affected not just us but the whole sector. Regulations need to be practically feasible and consistent to reduce the environment of uncertainty.”

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