India: Emerging to Surging

[via Abhijit Gore] McKinsey Quarterly had an article in 2001 on India which still makes interesting reading. The basic premise: “In a decade, the country could more than double its gross domestic product per capitabut only if its government and people act quickly and decisively.” To double GDP in a decade, India needs a growth rate of just over 7% per annum. We finally seem to be getting there. But we should be able to do a lot better. The article had a 13-point prescription for India:

1. Completely eliminate the reservation of products for small-scale industry; start with 68 sectors accounting for 80 percent of output of reserved sectors

2. Equalize sales taxes and excise duties for all categories of players in each sector and strengthen enforcement

3. Establish an effective regulatory framework and strong regulatory bodies

4. Remove all licensing and quasi-licensing restrictions that limit the number of players in affected industries

5. Reduce import duties on all goods to the levels of Southeast Asian countries (10 percent) over five years

6. Remove the ban on foreign direct investment in the retail sector and allow unrestricted foreign direct investment in all sectors

7. Resolve unclear real-estate titles by setting up fast-track courts to settle disputes, computerizing land records, freeing all property from constraints on sale, and removing limits on property ownership

8. Raise property taxes and user charges for municipal services and cut stamp duties (tax on property transactions) to promote the development of residential and commercial land and to increase the land markets liquidity

9. Reform tenancy laws to allow rents to move to market levels

10. Privatize the electricity sector and all companies owned by the central and state governments; in the electricity sector, start by privatizing distribution; in all other sectors, first privatize the largest companies

11. Reform labor laws by repealing section 5-B of the Industrial Disputes Act, by introducing standard retrenchment-compensation norms and by allowing full flexibility in the use of contract labor

12. Transfer the management of the existing transport infrastructure to the private sector; contract out the construction and management of new infrastructure to it

13. Strengthen extension services to help farmers improve their yields

Seth Godin’s Thinking

[via Abhay Bhagat] Excerpts from a lively Reveries interview with the “Permission Marketing” man:

The problem for most people who have a good job in a big company is that their main goal is not to lose their jobs. What big companies do is reward people for not screwing up. That is exactly the wrong thing to do, because if they don’t screw up then the company will certainly fail. The whole “safe is risky, risky is safe” paradox kicks in here.

If there are [common] threads [in my books], number one is that treating people with respect always works better than not treating them with respect.

Then number two, I believe as a corollary of that, smart individuals always do things better than dumb organizations. And so if we can empower the smart individuals and organizations to move things forward — especially if they can do it in a way that respects all the constituencies without kowtowing to them, but just respect them — then everything works better. Our jobs are better, our companies are more productive, the products that get made are the products that should be made, and everything just turns out for the best.

You can fire up Outlook Express and have an e-mail relationship with hundreds of your customers before the hour is up. So why don’t you do that? Why don’t you send an e-mail to a hundred people who do business with your company and ask them a question and see what they write back?

Then, have a dialogue with a hundred people for a week and see what you learn. Why don’t you get your staff together for lunch and tell them that the last person who comes up with a crazy idea is fired and see what happens? There are lots of things you can do that don’t cost anything, that aren’t particularly frightening, that can start this process unfolding in a bunch of different directions.

But if you just keep reading about it, nothing’s going to happen.

Business Week WebSmart 50

BusinessWeek writes about “the masters of the Web” who “have shown how they’re using the Web to benefit their customers — and themselves…it’s a real-life portrait of the next stage of the Web. The Internet, it’s clear, is being woven into every aspect of business and is shaking up entire industries.” Among the companies:

COLLABORATION: Mattel, Alcoa, IBM, Eli Lilly, Lockheed Martin, Homeland Security Dept., Sony, Saint Alphonsus, Bovis Lend Lease

CUSTOMER SERVICE: Krispy Kreme, Gilbane, GM, IndyMac Bancorp, Intrawest, JetBlue, Owens & Minor, UPS, Charles Schwab, Landstar, TaylorMade

CUSTOMIZATION: BMW, Harrah’s, Northern Group Retail, Stop & Shop, Wells Fargo

STREAMLINING: FBI, GE, Imperial Sugar, Nike, Posco, Progressive Insurance, Whirlpool, Sutter,
Shiseido, HIP

MANAGEMENT: Yellow, BostonCoach, Bristol-Myers Squibb, CareGroup, Kinko’s

CUTTING EDGE: Fresh Direct,, Wal-Mart, Dell, Florida Virtual School, Metro, P&G, Cisco, Wegmans, eArmyU

Utah’s Digital Infrastructure

NYTimes reports on a landmark effort by the state of Utah:

In a 21st-century twist on Roosevelt-era public works projects, Salt Lake City and 17 other Utah cities are planning to build the largest ultrahigh-speed digital network in the country.

Construction on the project is scheduled to start next spring – if the cities can raise the money to pull it off. The network would be capable of delivering data over the Internet to homes and businesses at speeds 100 times faster than current commercial residential offerings. It would also offer digital television and telephone services through the Internet.

With a $470 million price tag, the project is considered one of the most ambitious efforts in the world to deploy fiber optic cables, which carry data in bursts of light over glass fibers.

The cities involved argue that reliable access to high-speed data is so important to their goals of improving education and advancing economic growth that the project should be seen as no more controversial than the traditional public role in building roads, bridges, sewers and schools – as well as electric power systems, which are often municipally owned in the Western United States.

This is what India needs to do – recognise that the digital infrastructure is as important as the physical infrastructure, and remove all restrictions on the sectors.

Wal-Mart’s Power

Fast Company writes: “Wal-Mart wields its power for just one purpose: to bring the lowest possible prices to its customers. At Wal-Mart, that goal is never reached. The retailer has a clear policy for suppliers: On basic products that don’t change, the price Wal-Mart will pay, and will charge shoppers, must drop year after year. But what almost no one outside the world of Wal-Mart and its 21,000 suppliers knows is the high cost of those low prices. Wal-Mart has the power to squeeze profit-killing concessions from vendors. To survive in the face of its pricing demands, makers of everything from bras to bicycles to blue jeans have had to lay off employees and close U.S. plants in favor of outsourcing products from overseas.”


Dave Pollard has an excellent post which describes the need for a new department which “would have not only the traditional responsibilities for managing the financial, HR and sales systems and the centralized and desktop hardware of the organization, but also these new responsibilities”:

  • Development of new social software tools for front-line employees, including:
    – Expertise locators – to help people find other people inside and outside the organization they need to talk with to do their job more effectively
    – Personal content management tools – simple, weblog-type tools that organize, access and selectively publish each individual’s ‘filing cabinet’
    – Personal collaboration tools – wireless, portable videoconferencing and networking tools that save travel costs and allow people to participate virtually in events where they cannot afford to participate in person
    – Research bibilography and canvassing tools – technologies and templates that enable effective do-it-yourself business research and analysis and facilitate the preparation of professional reports and presentations, and

  • Hands-on assistance to front-line employees — helping them make effective use of technology and knowledge, including the above tools, one-on-one, in the context of their individual roles. Not training, not wait-for-the-phone-to-ring help desk service — face to face, scheduled sessions where individuals can show what they do and what they know, and experts can show them how to do it better, faster, and take the intelligence of what else is needed back to HO so developers can improve effectiveness even more.

  • McGee has a nice accompanying graphic which discusses push and pull inefficiences in knowledge management.

    The focus: on improving individual and group productivity, out of which comes enterprise productivity.

    TECH TALK: An Entrepreneurs Attributes: Problem Solving Focusing on Cause

    The better part of an entrepreneurs day is about solving problems especially in the early stages of a venture. Many things will go wrong; there are various challenges which need to be tackled. At these times, it is important to get to the root of the problem focus on what are the key causes, rather than just looking at some aspects of the issue and trying to fix the ones that are easy. When it comes to problem solving, one must not make the mistake of trying to go for the low-hanging fruit.

    Identifying the causes of what is going wrong is very important. What one sees are the effects. What is needed to trace back the lineage to the roots, and identify those key issues which cause the problem at hand.

    Let me give a current problem that I face and go through the problem solving process. In my company, we face an issue of support for our customers. Some customers are unhappy because they have to hold for a long time when they call, others are not too thrilled about having to explain the problem every time they call in the event that there is a new person who they are communicating with. If one just looks at these issues, then the obvious solutions would be to add more support staff and get the staff to document the problem faced by the customer when they call. But the issues are a lot more complex.

    The real reason that customers have to hold when they call is because there are too many calls coming. As we analysed the calls, we realised that many-a-time, we were being asked to tackle issues which are not even directly related to the solution that we had sold the customer. This was because we were offering unlimited and free support (as part of the package), so it was quite simple for the customer staff member to just call us and have us troubleshoot rather than taking the trouble to think and do it locally. So, perhaps, the right way to approach the solution is to limit the number of free calls with the solution that we sell. Once the customer realizes that there is a maximum number of free calls, then there will more caution exercised in the calls made to our office, thus automatically reducing the number of calls that the support staff have to handle.

    To tackle the other problem, one way to look at it is to get the support engineers to document the problem. When I talked with them, their answer was that it is hard to make notes and attempt to solve the problem at the same time. So why didnt they do it after the call? No time! This was because more often than not, the next call was given to them as soon as one ended. So, the solution is probably to separate the problem-taking and problem-solving, where the problem-takers make detailed notes in their discussion with the customer, but do not actually solve the problem. This could be complemented with an online problem-solving guide which helps the customer try and resolve the problem without calling our support staff (especially if the customer knows there are only a limited number of free calls).

    Thus, the solutions which are immediately obvious may not always be the best ones it helps to understand the core issues and then work on resolving them. By focusing on a few core issues, more often than not, one will find that most of the effects of the problem will vanish.

    Next Week: An Entrepreneurs Attributes (continued)

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