Cal Poly MBA Trip

http://www.businessweek.com/articles/2012-07-31/day-two-of-indias-blackout-hits-half-the-population

India has a power grid that is under incredible strain at the moment and has been having “back-to-back grid failures.” Due to this, there has been a surge of bad reputation for the country and businesses like “crematoriums…switched back to wood, tax authorities extended the deadline for filing returns, and stock analysts recommended shares for power equipment makers in anticipation of more investment in the grid.” Furthermore, grid failures have caused many multinationals such as GM who does some of its manufacturing in India to be fearful. Since the state “dominates power production” and the private sector accounts for only “27% of generation capacity” the question about whether the industry should be entirely privatized comes to my mind. If it were, the country would not be so dependent upon forces beyond its control such as rainfall shortages which decrease the ability of its hydroelectric power supply accounting for one-fifth of overall generation. Obviously there are also alternatives to privatization such as selecting different energy generation methods that are less susceptible to outside forces which is what the power ministry and Prime Minister Singh would like to do. His plan for $400 billion in power sector investment and intention of raising energy rates seems like a good short-term solution to the problem the country faces. However, many like S.L. Rao, former chairman of the Central electricity regulatory commission, think that this will be enough in the long run. I tend to think he’s right but I also believe that by privatizing the industry it opens the doors for potential environmental damage if the government cannot do a good job policing private energy generators. Since there is a great deal of corruption in the government already this is highly likely and so it might be in India’s best interest for the time being to continue having the government sponsor the energy industry while also setting long-term goals for transitioning it into the private sector.

http://www.businessweek.com/articles/2012-10-25/indian-companies-are-america-bound

In order for Indian businesses provide competitive services for American clients there has been a recent phenomenon of reverse outsourcing. That is to say $27.7 billion were spent by Indian firms to move some of their operations to the US for “faster customer support.” These firms argue that it “pays for Indian companies to hire some Americans, even though they’re more expensive.” Ironically, this has caused American technology firms to compete directly with these Indian firms for “tech talent” in the US because there is seemingly not enough of it. To further support this claim the article addresses the fact that some Indian outsourcers like MindTree have actually opened up software development centers in the US. Meanwhile, it seems as if this trend is leaving behind the many capable Indians who are talented in tech just because of the difficulty of obtaining foreign visas. This role reversal is interesting to see but as an American I am happy that some jobs are now returning to our country. Still there is a greater issue at hand here and that is – what will the American workforce be doing in the near future? It has been projected that many Americans will become knowledge workers but after having read this article I’m not so certain who will really end up behind the steering wheel of progress anymore.

http://www.businessweek.com/articles/2012-10-25/behavior-architects-tackle-indias-social-problems#p2

Is it possible for marketing firms to save lives? India based FinalMile has proven to me it is. Using what has become known as behavioral economics in the U.S., the company reduced train track related deaths by 75% in one city and was commissioned improve safety by India’s national railway system because of this. Moreover, other industries that might not usually used marketing are also employing FinalMile to campaign for initiatives involving safe driving and toilet use as opposed to public defecation. While this could be looked at as a progression toward more government propaganda, I think the initiatives that are currently being promoted are a good use of the government’s limited resources since health, wellness, and safety education is likely to be scarcer among India’s large poor population. In fact, I feel that it has just scratched the surface in terms of what it could do and that it should be used more regularly throughout the country. It has been said that a picture is worth a thousand words and with India being a country with citizens who use many different languages and are often illiterate, graphic illustrations such as those used by FinalMile are probably the best way India’s government could reach the largest number of its constituents with the clearest message. Obviously, radio and television can be used to help shape its citizens behaviors are both require technology while FinalMile goes back to the tried and true permanent billboards that require nothing more than an observer’s attention.

http://www.businessweek.com/articles/2013-04-11/ebay-helps-snapdeal-an-ebay-wannabe-in-india

Ironically, even though a large part of India’s population pays their professions off of providing services online to foreign customers its own “online retail comprises only 0.2% of India’s retail market.” This becomes less ironic when one considers the fact that only 10% of India’s population is online with “barely 10 million Indians having high-speed access.” However, this fraction of online retail is growing at 45% a year and companies like Snapdeal are quickly stepping in to fill the gap with local eBay-like services. Snapdeal much like MakeMyTrip is banking its success on the projected proliferation of low-cost phones and tablets that are making their way to a large part of India’s population. I think we will have to wait and see whether this business model will be successful in the long run in India. It has been known to work unites dates where national shipping is much more reliable and online purchases much more trusted. Furthermore, if as the article says “85% of transactions [in India] are in cash” which in my mind poses a large hurdle; one that online retailers will have to overcome somehow or else they will most likely fail. Since only time will tell how this industry actually fares, it is careless to make further projections, but if I were a betting man I’d say it definitely has a chance at being highly successful. EBay’s CEO John Donahoe certainly thinks so since it has invested $50 million in the 100-employee company.

http://www.businessweek.com/articles/2012-12-13/in-india-a-facebook-and-free-speech-debate

How much can you say online without getting arrested in India? Apparently it doesn’t take much now due to a little-known provision of India’s information technology act known as the 66A. This article points out examples to support the claims. For instance, Shaheen Dhada, a “member of a prominent Muslim family in the town of Palghar” was arrested for her negative Facebook comments about Bal Thackeray, recently deceased leader of the nationalist Hindu party. Moreover, businessman Ravi Srinivasan was arrested for “defamatory/scurrilous tweets” and cartoonist Aseem Trivedi was arrested for “sketches he posted online that attacked government corruption.” All of these instances have been met with public outrage as those who were previously used to having more free speech rights become afraid of the direction the government is going toward. In fact, many got together to petition section 66A in India’s Supreme Court claiming that it violates Indians’ constitutional rights. However, it has been kept in place for the time being with the attorney general’s assurance that the government would be tightening guidelines to check abuse of this section. It is shocking to me that such a guideline ever even passed in India who is known for being open-minded and democratic. Furthermore, I believe it indicates that the Indian government feels threatened by its citizens’ exchange of opinions because it fears that their dissatisfaction is more widespread which if not curbed could lead to organized dissent. This argument might not be agreeable to some but I fail to see any other reason why the government should censor and punish its citizens are sharing their thoughts unless they can actually cause the severe “annoyance, inconvenience, hatred, danger, obstruction, or insult” that 66A is purportedly intended to curb. As the presence and use of online technology grows in India I have to wonder – where will the government settle on to draw the lines about what is “dangerous” and what isn’t?

http://www.businessweek.com/articles/2012-02-23/chinese-imports-invade-india

Unfortunately, there is very little reciprocity between China and India when it comes to the export of goods. In 2011, exports from China to India reached $43.5 billion by exports from India back to China for only $19.6 billion. This makes people, such as the chairman of Bharat Heavy Electricals, very worried about India’s future dependence on China. He says, “Without a duty to control Chinese imports, we will continue to lean on cheaper, unproven equipment instead of building our own technology and our own industry.” However, it would seem that this is not only an Indian problem but American problem as well as both governments may join together to submit a complaint to the World Trade Organization about Chinese companies allegedly dumping cheap government-subsidized product into industries to knock out foreign competitors in their own markets. Needless to say this is a serious issue and the likelihood of the claims being true are fairly high judging by China’s past history and lack of reliability. The question is – will America and India begin erecting trade barriers to stop China from dumping or are they too hooked on cheap Chinese products step up and make such bold decisions?

http://www.businessweek.com/articles/2012-03-15/outsourcing-a-passage-out-of-india

India’s sales pitch is going to need to change for American companies to want to employ its workers in upcoming years. That is, in the past India was always good for what Robyn Meredith refers to as “back office operations” such as running call centers and data storage centers at a fraction of what it would cost to do the same thing in the US. However, many US companies are now looking to export their “skilled white-collar jobs in research, accounting, procurement, and financial analysis” to lower-cost countries but are not using India even though it is the cheapest. The doctor suspects that the rationale for this can be encapsulated by the opinion held by Phil Fersht, CEO of HfS. Phil states that “the higher-value outsourcing jobs require a greater understanding of business context and a higher amount of interaction with clients”; something he concludes cannot be found as easily in India. Therefore, businesses are turning to “nearshoring” jobs to European and South American countries. Employing workers in these countries often have the benefit of being in the same time zone which by now most businesses understand is advantageous for creating organizational synergy. Furthermore, labor in many of these countries is still very cheap and employing workers from them also has the added benefit of multilingual employees that do not have Indian accents (which carry a negative connotation) should a company choose to also locate its call centers there. Therefore, it is clear that the India workforce sales pitch will soon be in need of an image overhaul if it wants to stay internationally competitive.

http://www.businessweek.com/articles/2012-07-05/mumbais-boom-turns-renters-into-millionaires

It is common in India to have apartments with established rent protection because of the Bombay rent control act of 1947. Because of this, residents who have lived in the same place for several decades are now turning into millionaires as developers offer them large sums of money (the article cites an example of one couple pocketing $2.5 million from Orbit) to sell and vacate their apartment. The reason developers are so willing to do this is that certain areas in South Mumbai are projected to have a potential value of “$40 billion if redeveloped” according to Pujit Aggarwal, managing director at Orbit. This means that renters who pulled off the longest from being bought out usually get the greatest payoffs. As a business person, this begs the question – which areas will be next for development? If investors are able to predict this in the near future, I believe it is safe to bet that real estate investing will quickly grow and small player wins like the ones discussed in this article will fall. Moreover, if this is widespread, who’s to say India will not experience a similar housing bubble to the one taking place in China?

http://www.businessweek.com/ap/2013-05-14/india-announces-low-cost-rotavirus-vaccine

To combat the rotavirus, one of the leading causes of childhood death, the government has announced that it will be selling a vaccine for $1 a dose. Every year the virus kills roughly half a million children worldwide. With the cost significantly lower than it otherwise would be, I expect more children will be able to be immunized. After presenting the history of how the vaccine was developed in New Delhi through a public-private partnership, it drew the conclusion that “broad cooperation reduced research costs for the manufacture and helped keep the vaccine and expensive.” I personally tend to believe that partnerships like this should be encouraged to develop technologies that save lives; especially in countries like India where there is great need. It would have been nice if the article all had gone into further depth about how this partnership structured but that would probably have taken several more pages explain. It would also have been nice if it had shared how it plans to reach the children affected that do not live in India. Still, this is a great example of how businesses and government should and can work together toward social responsibility and based on India’s family like culture; it does not surprise me that it is a trendsetter in this field.

http://www.businessweek.com/articles/2013-04-04/on-matrimony-dot-com-indias-arranged-marriages-hit-the-web

So you thought parental matchmaking was something of the past in India? Think again – “marriages within the community is still very much the norm” except now there is a modern twist to the process. Narayan’s article focuses on the growth of Matrimony.com, a company that has “brokered more than 2 million marriages” by helping parents match their children by cast, complexion, and religious values. The company also touts an Elite Matrimony unit for those who don’t want their offspring’s profile blasted around the web and have the money to pay for this premium service. Putting aside the standard ethical debate that centers around arranged marriage and just looking at this from a business perspective, this industry has a great deal of room for growth I do not doubt that he will meet or exceed its $37 billion projected cap.