Friday, December 4, 2009

Procrastinate

Procrastinate is defined as 'to put off from day to day, to delay, to defer to a future time. As I read this, the word doesn't seem to carry a negative connotation. Then why is used in that sense? Another misused word, quoted out of meaning!

And in today's information overload environment, hectic work-style, procrastination is a necessity, and may be the right thing to do. With more technology, we are able to handle more. But demands have also increased manifold. We allow ourselves to be interrupted and disturbed in more number of ways than ever before. And reminders and follow-ups have become the norm.

If you don't procrastinate, you will have to act on all your deliverables, without assigning priority, and it will require us to multi-task. And there is nothing more inefficient that multi-tasking.

The word 'procrastinate' is so benign, so harmless, even necessary. But its usage is incorrect. However, that doesn't mean there is no problem. We have probably used the word to describe a wrong problem. In reality, the problem we are trying to describe could be one of lack of planning, inefficiency in execution. By using a word that means something else, we are actually misreading and misrepresenting the real problem.

So what do we do about it? Lets discuss that some other day!

New York! New York!

An exceptional Mumbai-bred mathematics student is convicted of threatening to kill George Bush and other ministers over his web post. The FBI has filed a case against him based on messages on a Yahoo site, and they believe that the statements calling Iraqis to avenge war on their country by America, were sent from his computer in his university.

That's Vikram Buddhi! He has already spent two and a half years in jail, and has apparently been the target of racially motivated violence. He is looking at 35 years, if convicted. And people believe he is innocent and wrongly held.

This is another example of a possible over-reaction by America post 9/11. A subject very well handled by a recent Hindi movie 'New York'. We saw that movie a couple of weeks back again when it ran on television. The treatment of the subject is very mature. And I like the character played (very well) by Irfan Khan.

Especially two lines. One where he says that it is only a person within the system can restore the confidence lost. And the other where he says that this is the country in which you can still expect a migrant's son to captain the baseball side. Somehow, the way it is said invokes a sense of belief and leaves you assured that things change for the better.

We may or may not agree with what is said. And what was said could be untrue. But in the context and presentation, it appears justified and logical, depending on how liberal your viewing lens are. The current episode of Vikram brought back memories, and gave another reason to not believe!

Wednesday, December 2, 2009

Business and Finance are very different

Last week, I happened to attend a seminar on treasury and finance organised by EuroFinance at Taj Lands' End, Bandra. Ajit Ranade was the keynote speaker. He spoke about the current financial situation in brief. He also quoted an article that Michael Kinsley wrote in the New York Times in 2007 when Warren Avis of Avis Rentals passed away. An amazing article which I was forced to search and retrieve on the net. I reproduce the article below. I was reminded of the many times we discussed about the importance of the real as opposed to the derivative, about the cake rather than the cream, about drink rather than the fluff. Read the article. I needn't say more.

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We Try Harder (but What’s the Point?)

By MICHAEL KINSLEY
Published: May 16, 2007
Seattle

IN 1946, Warren E. Avis (who died last month at the age of 92) had an idea: rental cars should be available at airports. So he founded Avis Airlines Rent-a-Car. In 1954, he sold the company to another businessman, Richard Robie. Two years later, in 1956, Robie sold Avis to an investment group led by a company called Amoskeag. In 1962, the investment banking firm Lazard Frères bought Avis. In 1965, Lazard sold Avis to the giant conglomerate ITT Corporation.

Since 1946, Avis has been sold or reorganized 17 or 18 times, depending on how you count. Each time Avis changed hands or structure, there have been fees for bankers and fees for lawyers, bonuses for the top executives and theories about why this was exactly what the company needed. 

In 1972, ITT spun off Avis as a publicly traded company. Then, in 1977, the company was bought by another giant conglomerate, Norton Simon. In 1983, a company called Esmark (formerly Swift & Co.) bought Norton Simon. In 1984, Esmark was bought by Beatrice Foods, and in 1986, Beatrice was bought by the leveraged buyout firm Kohlberg Kravis Roberts & Company.

Kohlberg Kravis Roberts immediately sold Avis to an investment group called Wesray. Wesray sold Avis’s fleet leasing business to a company called PHH Group. Then it spun off Avis’s foreign operations and took them public as a company called Avis Europe P.L.C. And then, in 1987, Wesray sold Avis to its employees under an employee stock ownership program. Wesray more than tripled its money in 14 months.

Two years after the stock ownership deal, the company sold General Motors a complicated security that effectively gave it a 26 percent stake in Avis. Apart from that, Avis’s employee ownership experiment lasted nine years, until 1996, when Avis sold itself to a company called HFS. Employees got an average of $26,000 each. Eighty or 90 current and former Avis executives got an average of $1.75 million each.

A year later, in 1997, HFS took Avis public. (The initial public offering raised just over $330 million. The banker Bear Stearns charged $15 million for its services.) In 1999, Avis bought PHH. Remember PHH? That was the company Avis sold its fleet leasing operation to in 1987. PHH was owned by Cendant, a company that had been formed in 1997 by the merger of HFS — right, the company that had spun off Avis in 1997 — and another company called CUC. HFS had retained 19 percent of the company’s stock when it took Avis public. With the stock portion of Avis’s purchase price for PHH, Cendant now owned 34 percent of Avis.

A couple of years later, Cendant bought the roughly two-thirds of Avis that it didn’t already own and made Avis a wholly owned subsidiary.

In 2006, Cendant split itself into four independent companies, one of which was the Avis Budget Group. (Somewhere along the line, Cendant had also acquired Budget Rent a Car.) The Avis Budget Group became the parent company of Avis Budget Car Rental.

Modern capitalism has two parts: there’s business, and there’s finance. Business is renting you a car at the airport. Finance is something else. More and more of the news labeled “business” these days is actually about finance, and much of it is mystifying. Even if you can understand — just barely — how it works, you still wonder what the point is and why people who do it need to get paid so much. And you strongly suspect that the swirl of financial activity around Avis for the past six decades has had little or nothing to do with the business of renting cars.

Last September, a week after the Avis Budget Group began trading on the New York Stock Exchange, The Wall Street Journal reported that the new company was “ripe for the picking.” Carl Icahn, another wily financier from the 1980s, had acquired a $100 million stake in the company and would not comment about his intentions.

The Journal warned, “If a buyout or acquisition deal doesn’t materialize for Avis, stock and bond investors will have to focus on the fundamentals of its car-rental business.” Goodness! Anything but that!


Michael Kinsley is a columnist for Time magazine.


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Thursday, November 26, 2009

Where was I when Mumbai was attacked on 26/11

Some events in history are so profound that you'd remember exactly where you were, what you were doing when you first heard the news.

The truth of this statement cannot be disputed. I read it in "The Prodigal Daughter' by Jeffrey Archer. I was thinking of this statement in relation to the anniversary of the terrorist attacks on Mumbai.

We are at one year after the 26/11 attacks on Mumbai. This is one of the defining moments for India, definitely for Bombay. I say defining because it reiterated what we are, our spirit, which many events in the past have done. But this one was different in that we realised that this spirit is not one of defiance, but of reconciliation and acceptance of our limitations.

Coming back to the statement, I feel that it has a personal thrill attached to it. We seem to derive a great amount of pleasure narrating shock events. The more the shock, the more the pleasure. And the closer you are to the event, the more the intensity in the narration.

And what a contradiction this throws up! If I were to be confronted with a developing event such as 26/11, my natural reaction would be to run to safety. But once the event is over, I would want to claim proximity.

Every citizen will have his own story to tell of how he heard the news and how he reacted. And what better occasion than the first anniversary. All news channels had taken full advantage of the situation, just as they had done a year back, in whipping up emotions.

I can tell you where I was. We were writing and practicing our lines for our drama at a friend's place. That was when my wife got a call from her colleague that there had been a blast at Vile Parle. And then I got a call from my colleague about the same blast. And another friend got a call that CST had a terrorist attack.

I'm no different! Some events in history are so profound that you'd remember exactly where you were, what you were doing when you first heard the news.

Thursday, November 19, 2009

Peter Drucker is 100

Peter Ferdinand Drucker is 100 today. If there is one person who has impacted the thought and direction in the field of management in the most profound manner, it is Drucker.

I admire his thoughts and his writings for the variety of subjects he covered, for the simple underlying principles for all that he said, and for the vision and foresight.

Some of the basic ideas that he propounded were indeed basic. But those basic ideas had been lost in the myriad and complicated world of management literature. In such a scenario, he chose to remain simple in his explanation.

The belief that thought before action is very important, decentralisation and rejection of command and control structure, focus on employees as assets, who needed to be cared for, 'planned abandonment' of existing and past successes, importance of processes for everything, the concept of the knowledge worker, and the need for community were the highlights.

I liked him because he was a skeptic of macroeconomic theory. Since the advent of banker economists, decisions are being driven by macroeconomic masala with absolutely no awareness or understanding of the real economy. Drucker warned against this. And look where we are today.

He also believed that CEO pay should not be more than 20 times worker pay. This has been flouted many times over, and we've ended up in this state of the mass up against the establishment.

Look at the wide spectrum that he has touched upon, and you will realise that most others who have claimed to have said something path-breaking are but reflections of this great man.

I remember him and his view in a class of cost accounting in which my professor explained why relevant costing was so good, spending great amounts of time to convince us why we should look at relevant costs, only to conclude by quoting Drucker who said that you should cover total costs if you have to be in business in the long term.

There is only one guru, and that is, without doubt, Peter Drucker. He hated being referred to as a 'guru', and said that the term was being used as it was shorter than 'charlatan'. I don't agree with this. I'm not sure if he was only being modest, but in the Indian sense of the word 'guru', a teacher, he absolutely fits the bill.

It would be an achievement if I could test the waters, touch the shores of the ocean that Drucker is. I'll read what I consider to be one of his best works 'Management Challenges for the 21st Century', today. It could very well be called 'Management Challenges for any Century'.

Saturday, November 7, 2009

Mozhi, Language

Mozhi is a beautiful movie. And the music of the movie complements the concept well. The highlight is the song 'Katrin Mozhi', written with a lot of love, music and lyrics. This is a song that touches your heart, makes you smile, and feel good. And it reflects the mood very aptly. I rate this as one of the ten best Indian songs created.

The format of the song is very simple, very conventional, following the usual mukhda-interlude-antara pattern. But it scores with its simplicity and its adherance to the mood without exception or stray. Another important aspect of the song is that it ensures that the lyrics are clearly understood by any listener. The singer has an understanding of the feeling expressed in the song.

There are few songs which are able to stick to the regular format, yet establish such a rapport with the listener. And linger on in your thoughts. I reproduce the lyrics below. I thought I'd attempt a rough translation, but realised two things. One, that I was good only at prose, not poetry. And two, translation kills the mood. Most things are better in their original form.

Katrin mozhi oliya isaiya
Poovin mozhi nirama mananama
Kadalin mozhi alaiya nuraiya
Kadhal mozhi vizhiya idazha

Iyarkaiyin mozhigal purindhuvidu
Manidarin mozhigal thevaillai
Idhayathin mozhi purindhuvidu
Manidarin mozhigal thevaillai

Katru visum podhu disaigal kidaiyadhu
Kadhal pesum podu mozhigal kidaiyadhu
Pesum varthai pola mounam puriyadhu
Kangal pesum varthai kadavul ariyadhu

Ulava therya katrukku oruvam theta mudiyadhu
Kadhal pesum mozhiellam sabthakootil adangathu
Vanam pesum pechu thuliyai veliyagum
Vanavillin pechu niramai veliyagum

Unmai oomai anal kanner mozhiagum
Penmai ommaianal nanam mozhiagum
Osai thoongum jamathil uchimeengal mozhiagum
Asai thoongam idayathil asaivu kooda mozhiagum

Friday, November 6, 2009

Michael Crichton on humans

I had to post this compelling quote by Michael Crichton from 'The Lost World'

“Human beings never think for themselves, they find it too uncomfortable. For the most part, members of our species simply repeat what they are told — and become upset if they are exposed to any different view. The characteristic human trait is not awareness but conformity…Other animals fight for territory or food; but, uniquely in the animal kingdom, human beings fight for their ‘beliefs’…The reason is that beliefs guide behavior, which has evolutionary importance among human beings. But at a time when our behavior may well lead us to extinction, I see no reason to assume we have any awareness at all. We are stubborn, self-destructive conformists. Any other view of our species is just a self-congratulatory delusion.”

Wednesday, October 14, 2009

Staying on top

An excellent leader in The Economist analyses the calibre of chief executives of banks in America.

Only three of the chief executives from the ten largest banks in America during the unfolding of the financial crisis remain. The rest have been asked to leave over the past year.

Some are claiming conspiracy, in that chief executives have manipulated for personal gain. This may appear true considering the lavish perquisites that they showered on themselves - expenses claim on a $87,000 rug, playing a game of bridge as their firms collapsed, almost like Nero. The article compares this to actions of Kenneth Lay of Enron and concludes that most of the current breed were useless.

It says "Far from expertly manipulating their firms' books, many could not even understand them" and "....even when they had decent numbers, executives struggled to manage their mutinuous staff". One ex-boss said "... his job was less of management, more crowd control".

Did acquisition make a difference? No. Acquisitive firms such as BoA, Fortis and RBS floundered. Those who were not acquisitive, such as JP Morgan Chase and Barclays prospered.

Did long-term perspective make a difference? No. Managers at Bear Stearns and Lehman Brothers did have a lot of their personal holdings, but did not focus on the long-term.

Did risk committees make a difference? Hardly. Santander had 98 meetings in 2007 while Credit Suisse's had just six, yet both did much the same.

So, what is generally prescribed by the know-it-alls as required and essential is not necessarily the right thing to do. Its better to be a historian than a politician; an economist rather than an executive. The former have the advantage of hindsight.

The summary "On any measure of banks' boards - experience, gender, age, independence - there were successes as well as failures". "What firms need is a culture of excellence, but that is like saying all football teams should be like Manchester United".

My line "It is remarkable that these executives stayed on the top without staying on top of their jobs."

Monday, October 12, 2009

Mediocrity rules

We had been to a music concert of old hindi film songs from the 60s and the 70s yesterday by a group called 'Klub Nostalgia' held under the aegis of our association Mulund Fine Arts Society at Kalidas Natya Mandir, Mulund. I've heard them several times before, out of which a couple were under our sabha. Anil Bajpai was exceptional, as always; Vinod Seshadri was good in some songs, while average in most others. Others were at their own best, but that's it.

To tell you the truth, I always liked 'Golden Greats', another such group, more. I don't know the entire inside story of how and why singers moved en masse from 'Golden Greats' to 'Klub Nostalgia' so I cannot comment on that.

But 'Golden Greats' was true to what they did; the effort was diligent and impeccable; no compromise whatsoever; you could see them being very passionate about hindi film music of the yesteryears. 'Klub Nostalgia' is, at best, a compromise, a 'chalta hai' effort group. And since the whole world is at a level of mediocrity, they thrive. 

This reflects life, as most matters do. The few who attempt to reach excellence and perfection eventually fall to the sides. And the ones who compromise and insist on the mediocre, keep going. You must only know how to capture the stupid imagination of the masses. The numbers count. If you can't act like Naseeruddin Shah, fool around like Govinda. If you can't sing like Sonu Nigam, there's Kumar Sanu. If you can't create a 'Gulaal' make a 'No Entry'. The world has been returned to the bin.

Friends tell me there are a few things left in the world where excellence still rules. Wimbledon, Oscars, are what come to my mind. With no information contradicting that view, I agree.

But we don't live in that world, do we?

Tuesday, October 6, 2009

Bombay to Goa




We had been to Goa over the weekend. And I must say, Goa is amazing in the rains. With lesser crowd and a cooler climate, it is the best time to be there.

A little on the journey.

We left at 9.30 pm on Thursday, October 1, 2009, by road. We took the Mumbai-Pune expressway, the Pune-Satara-Kolhapur highway NH-4, turned right at Nipani, and reached Panaji at 9.30 am through Amboli Ghat. We reached the Nipani turn at the wee hours of the morning. The ghat section took time because of the inclement weather, the mist and the rain, the poor visibility. I liked the experience of driving the Amboli ghats when everyone else had slept off in the car. It was just me, my car, my music, the mist, the waterfalls and the winding road ahead.

The return back was more routine. We found a better road back to the Kolhapur expressway, that went through Ajara and Sankeshwar. Thats a better road than what we found on the way to Goa. But we found lot of local traffic on the Kolhapur-Satara belt since it is not an expressway. So there are a lot of turns into villages and towns on both sides of the highway. One has to be careful.

A few facts. The road to Goa through Pune-Satara-Kolhapur via NH-4 is the same distance as the road through NH-17. Both are 590 kms. The old road is more enjoyable, I heard, because it has four ghat sections. But NH-4 should be preferred for night drives. But the highway is safe only during nights, since there is no local traffic.

While on the Kolhapur highway, we turned at Nipani, next to a hotel called Cauvery. Its better to continue further and turn at Sankeshwar. As I said before, that road is better.

On the way, you go through a patch of Karnataka. Maybe a few kilometres. And in this stretch, there is no board in English or Hindi. And there is no mention of Goa anywhere. Its better to ask before you turn.

More on Goa later.