An eventful week

If the last week is anything to go by, it probably is the end of Wall Street as we know it. At least that's what the guys who know it say.The good thing is I am now aware of Nouriel Roubini ,an interesting economist. He says it is nothing to do with management of the ibanks per ser but it is the flaw in the business model. My biggest worry is back in India everyone is feeling safe that KV Kamath has come out and said that ICICI \’s exposure to this is already assessed and minimal but that's not the problem, The problem is these same philosophy and fundamentals were duplicated elsewhere perhaps in India too. If that's the case then its time we toughen ourselves. I accept that the financial industry is far removed from my regular interactions but all the same.

The good fallout:

1. Hopefully this will end the Top MBA conforming to stereotypes  and look 4 real jobs in real world: My personal opinion is I-banking recruitment is to MBAs what joining the SWITCH(Satyam Wipro Infosys TCS CTS HCL)is to top tier engg students
2. Perhaps this will end the Government service mentality of professional programmers working with SWITCH i.e. they go to office at 9 worry about over working take long breaks use the office phone for  personal needs and are bitching about how low they get paid/work compared to someone who is on bench
3. Perhaps this will stimulate people to look at engg courses other than IT CSE .Atleast that's the norm in my state of Andhra Pradesh
4. Hopefully working in US with a body shopper stops being important achievement

Personally I think Management Consulting is another over hyped industry but then they dont do anything apart from hiring MBAs from best schools, pay very high salaries and creating a Brand out of it so it cannot crash i guess. (Pretty strong lobby)(Yeah I know they do more than that like adding value to an org etc but you  really know what it is too.)

Lets hope the remaining bad value crashes and is flushed out of the system , The government saving them will come back to haunt us.

Thankfully noone reads my blog otherwise I would get slammed

The Subprime crisis

The making of Subprime crisis

View SlideShare presentation or Upload your own.

IAMAI event

Its been a week , but could not get access to a scanner to upload handouts.

In blore was trying to help WAT team by sharing my jottings of the IAMAI digital marketing even.

You can find Rajiv doing a professional job of my  amateurish work.

The coverage is as below

Panel 1

Panel 2

Panel 3

Panel 4

Panel 5

In Panel 4 vivek mentions phone search as follows : "Phone-> Can we record conversations, Transcribe it, Index it and interupt my call by playing an ad to both parties and pickup the bill for a few minutes of the call? Also scope to record make dtmf based inputs from the users?"

Think Rajiv Poddar of Call Graph has a headstart here . Hope they can do this. Obviously they can use the OnMobile Developer Network . The fact that Callgraph now has MVP backing should also help them

ISB Private Equity Conference Panel Discussion 2

I attended the event post lunch session after the CITNE event

The moderator:

Karan Khemka; Senior Principal, The Parthenon Group

The panel :

Rahul Bhasin; Managing Partner, Barings PE Partners
Nainesh Jaisingh; Managing Director, Standard Chartered PE
Satish Mandhana; Managing Director, IDFC PE
Aluri Srinivasa Rao; Managing Director, Morgan Stanley PE
Vishal Sharma; Managing Director, Tuscan Ventures
K Thiagarajan; CEO, Maytas Properties Limited



The session started with a formal presentation by Karan Khemka informing the audience about the niche Parthenon was consulting both the Investors and the Invested in Private Equity space.They help Invested companies realise their true potential , utilize effectively the capital and the help the PE firms with due diligence .According to him PE helps validate the promoters/entrepreneurs in the business world and propels them into the next level of scalability . Promoters open up till now tightly held control and hence Trust between two parties is a key ingredient . This alliance is as dynamic and colorful as the courtship and dating rituals in our personal life.

Two case studies presented by him further explained these points

Key Takeaways for Entrepreneur /Promoter from his presentation

1) Find out true potential of the business you run, although you may never realise it.

2) Build a framework to measure performance rather than blindly adhering to targets

3)PE money usually looks for 4x returns

After this Karan put the first question to the panel:

Does Private Equity add value to India Inc's business practices?

The panel members from PE background agreed that most promoters often ask them if you could value to my business you would do it yourselves.

Rahul Bhasin pointed out that they retain around 12 firms for various services to help out the invested companies while Vishal pointed out that they hire almost all people with operational experience and do have an operational business, but he said they can do it only because they are very focused on one particular sector (Logistics).

They were us general consensus that the PE team adds value primarily in corporate finance , financial engineering ,defining inorganic agenda and corporate governance.

Rahul pointed out that creating right incentives ,KRA's ,alignment is an area where almost every company consistently gets it wrong and there are very few exceptions.

Barings PE partners are a very old firm (estd 18th century) and they have created a compendium of mistakes which helps avoid repetition of the mistakes under similar circumstances.

Responding to a question on when there is a disagreement with a promoter , the panel pointed out that they develop a framework to be used for agenda setting and this helps in bringing the discord in perspective, but taking to the the extreme like having everything penned down in black white is battle lost .

Another common opinion of the promoter that the panel encountered was that he was taking a 10 year view whereas PE is in the 3-5 years horizon . It was pointed that PE usually also takes a 10 year view in sense that though they take a 5 year view they need to exit and here the entity buying from them also takes a 5 year to set a price .Hence they need to take a 10 year view for a good exit.

In this context Rahul pointed out a tests he uses to avoid such conflict.

Test 1: Do we really know this business and can transform it.

Test 2:The shopping mall test: If I run into the promoter in a shopping mall will I go forward and be glad to meet him?

Test 3: Can I disagree amicably and professionally with this person

If any of the above answers is in the negative they don't invest.

It is very difficult situation to be in if there is a conflict and it constitutes promoter interest vs company interest, and Vishal pointed out that when in hole stop digging and get out.

When asked whether any invested company has told them they were too active .

The panel agreed that is never the case as in everyone is short staffed.However they are told so in a scenario where they pull a an underperforming member.

Rahul pointed that they usually need to put in as much work it takes not how much is requested for . Nainesh said depending on the limited bandwidth they have clear agenda setting on what roles the PE firm would fill in.

Karan tabled the second question,

Are family and other emerging business opening up to a PE as a source of investment?

The panel agreed that we have come long way as to how PE is perceived by family business(acceptance has gone up significantly) but still many family business are exploring the role of PE and now they have a few examples to look at.

A family business it was pointed needed to have a competency mapping done, approach its affairs in a professional way and have clear succession planning in place before starting to look for PE money.

The PE firms look for one person as a driving force in the company ,may be a father son but they avoid if they have too many relatives driving it in different directions

They also pointed out that sometimes PE money is used by a single member to settle family politics and drive the board composition in his favor.

The third question was tabled

Do PEs bring corporate goverance into invested firms?

Most of the corprorate goverance we see today especially in Indian context  is brilliant packaging.

The promoter can always beat the system the question is will he do it?

A promoter who is a long term player with a willingness to learn will ususally detest from bad goverance policies

The munnabhai test: Check if he is fair to people normally ,even to people who dont matter to him much,then the promoter can be trusted

The panel had come across many instances where violations were excused by promoters as saying it cannot be avoided. Do not take refuge in it

Most of the regulation today is cloaked and leading to a breed of disinterested directors rather than responsible independent board members.

When the panel asked the Grant Thorton representative from first panel,Harish HV, whether he has ever come across an indepent audit committee , the answer was never and dont expect to come across either.

Vishal pointed out that lack of coprorate goveranace was not Indai specific , infact it existed across the world even in US. There is a normal distribution of people. The best remedy is do your due diligence and then pray

Rahul's closing comment :PEs ususally get many things wrong hence the industry has a high mortality rate

The official coverage is here

ISB Event : Panel discussion on the " The Key Characteristics of Technology Enabled Services"

The event purpose was to kickstart research project to identify multiple measures of performance in the above IT and ITES services.
The research team is led by CODE at University of Auckland Business School harnessing the presence of CITNE at ISB. HYSEA is the partner industry forum.
Panelists:
B Balaji (Vice-president of HYSEA)
Professor Deepa Mani (Indian School of Business)
Professor Rod Brodie (University of Auckland)
Professor Ananth Srinivasan (University of Auckland)
[Trivia : Professor Ananth is from Vizag just like me ;-)]

Bringing out his India connection, Professor Rod Brodie informed us that though this is his first visit India,his mom spent her childhood in India. He will be returning again later this year for the 100 years celebration of an hospital founded by his grandfather in rural Punjab and still actively supported by their family
We had a simple walk through of the handout distributed by respective speakers.
Willing be uploading the handout by tomorrow.
Key questions that remain to be explored:
1.Does branding play a role in moving up the value chain?
2.What are the challenges to build an efficient governance model in large multi sourcing engagements across BPOs ,KPOs and IT companies with their respective clients?
3.Can governance be outsourced in large dynamic outsourcing engagements?
Observations:
1. Conflict between manufacturing mindset vis a viz the services mindset
2.Due to lack of a mature manufacturing industry and the industrial revolution the developing world has less exposure to the manufacturing mindset and more oriented towards service
3.In developing countries, customer centric service is mass produced.
Result : Technology companies investing in building capabilities in region specific social sciences in general and anthropology in particular. This will create a new category of engineers called service scientists who will have to drive innovation blending technology and social sciences
[Aside:Waiting to see what data they gather from China where Manufacturing is a Service .Can India compete with Chinese in MaaS(Manufacturing as a Service) ?]
4.Paradigm shifting towards driving innovation within Extended Enterprise rather than a large monolithic organization alone(Extended Enterprise :Customers, Partners, Suppliers, Outsourcers, Distributors, Resellers etc).
5.Is co-creation the new mantra?
Key hurdles from my(Deva5) experience:
1.Who owns the IP?(nipping the initiative in the bud)
2.Will the initiator and driver be the same entity in the long run?. If not is the initiator willing to relinquish control? (Killing the initiative midway)

The discussion concluded with a promise to share leanings with the participants once the research concludes.
A website, a blog to be created for this research project.
A lot of participants were confused on the scope of research.
Research team will be detail the scope ,exclusion once the above channels are up.
Delicious Sarovar lunch followed (ISB students get the pun?)
[Trivia : My friend who is with a research team at IISC tells me that all technological (true for all engineering disciplines other than IT) research in India is just re-search now aided by Google . ]

Innovative use of a mobile phone with a camera

I was talking to a cousin of mine, he informed me of an innovative use of mobile phone during the recent Mandal level elections in his village. The phone used was a lentry level phone of Nokia with a cam.(If I am not wrong it costs around 2500 rs )

The problem statement: It is an open secret that a voter is bribed to vote for a candidate . The bribe is usually a packet of chicken/veg biryani + country liquor for a male and sarees + trinkets if female. Additional benfits if it happens to be a close fight. The candidate after mobilising voters has to ensure that the voter did in fact vote for him/her. Many losing candidates owe their defeat to such cross voting of professional voters.
Solution: To ensure that voter infact voted for him, a entreprising candidate arranged for his men to lend the professional voter a mobile phone with a camera, ask him/her to take picture of the ballot after stamping and before casting it into the box. Only then was the voter given promised benfits.

Brilliant.

I am wondering whether this can be scaled to an Electronic Voting Machine.
Will the upcoming general elections throw up many more innovative uses of the mobile, be it legal or real?

In India the Mobile Rocks!!

Hello World

Plan to share my thoughts on Mobile ecosystem in particular and other related fields