Page 1

ow… n s i MI ted! TAP accredi SB AAC


The Reflection of Management


Each Artisan. An Entrepreneur – Need for Sustainable Impact. A Ja i p u r Ru g s Sp e c i a l

The People make it possible! By Ashish Agarwal

By Simone Lobo

FMS, Delhi

XIMR, Mumbai

This very stance of power and autonomy achieved by these institutions is what Paul Volcker is adamant about ending but then who is Paul Volcker and what is he planning to do so? By Savio Fernandes GIM, Goa

Delving deeper into finer details of entire supply chain of the Healthcare industry, some glaring inefficiencies come to forefront… By Trisha Pandey SJMSOM, Mumbai

A Student’s Initiative Pratibimb | April 2012 | 1

Volume II, Issue X

April 2012

A Monthly e-Magazine

T. A. Pai Management Institute Manipal, Karnataka

About TAPMI T. A. Pai Management Institute (TAPMI) is a premier management institute situated in Manipal and is well known for its academic rigor & faculty-student interaction. The Institute has been recently ranked amongst top 1 per cent of B-schools in India & 4th in the South Zone by The Week Magazine. Founded by the visionary, Late Shri. T. A. Pai, TAPMI’s mission is to provide much needed impetus to the task of building professional management capability in the country. In the process, it has also played a role in strengthening the existing educational and health infrastructure of Manipal.

Our Mission We are committed to excellence in post graduate management education, research and practice by nurturing and developing global wealth creators and leaders. We shall continually benchmark ourselves against the best-in-class institutions. We shall foster continuous learning and reflection, achievement-orientation, creative interdependence, and respect for diversity with a holistic concern for ethics, environment and society.

Recent Updates AACSB( the Association to Advance Collegiate Schools of Business) Accreditation Standards are used as the basis to evaluate a business school’s mission, operations, faculty qualifications and contributions, programs, and other critical areas. AACSB accreditation ensures students and parents that the business school is providing a topquality education. Additionally, AACSB accreditation provides global recognition. TAPMI is the second management institute in India to receive this meritorious accreditation. Pratibimb | April 2012 | 2



APRIL, 2012

TAPMI’s e-Magazine - is the conglomeration of the various specializations in MBA (Marketing, Finance, HR, Systems and Operations). It is primarily intended to provide insights into the plethora of knowledge that relate to the various departments of Management and to give an opportunity to the students of TAPMI and the best brains across country to exhibit their creative cells. The magazine also strives to bring expert inputs from industries, thereby bringing the academia and industry together. Pratibimb the e-Magazine of TAPMI had its first issue in December 2010. The issue comprised of an interview of denoted writer Ms. Rashmi Bansal along with a series of articles by students and industry experts like MadhuSudan Rao (AVP-Delivery, Mahindra Satyam) & Ed Cohen who is a global leader and chief learning officer who led Booz Allen Hamilton & Satyam Computer Services to the first rank globally for learning & development . It also included a hugely successful and engrossing game for finance geeks called “Beat the Market” to bring out the application based knowledge of students by providing them the platform where they were expected to predict the stock prices of two selected stocks on a future date. The magazine is primarily intended for the development of all around management knowledge by providing unbiased critical insights into the modern developments. TAPMI believes that learning is a continuous process and is not limited to the four walls of the classroom. This viewpoint is further enhanced through Pratibimb wherein students manage and contribute to create a refreshing learning environment outside the classrooms which eventually leads to a holistic development process. The magazine provides a competitive platform and opportunity to the students where they can compete with the best brains of the country. The magazine also provides a platform for prominent industry stalwarts to communicate their views and learning about and from the recent developments from their respective fields of business which in turn helps to create a collaborative learning base for its readers. Pratibimb is committed in continuing this initiative by bringing in continuous improvement in the magazine by including quality articles related to various management issues and eventually creating a more engaging relationship with its readers by providing them a platform to showcase their talent. We invite all the best brains across country to be part of this initiative and help us take this to the next level.

Pratibimb | April 2012 | 3



It is always a pleasure to witness that certain efforts of the students are sustained and carried forward; Pratibimb is one such. The oft-beaten track, “We are here to learn,” ends up as a mere platitude when there are no visible actions and documentation. Whereas there is no dearth of actions at TAPMI, documentation is not something that many—other than scholars—choose to engage in; it is normally viewed as uninteresting, drab and a drudgery. TAPMIans have proved that they are equally capable of actions and of documentation without losing the intellectual flavour of it. Scholarship is too important a phenomenon to be left to scholars alone, especially in the field of management. As future practicing managers who will be engaged in rigorous action in different fields of business, TAPMIans have manifested both the penchant to produce research works and also get their counterparts in other leading business schools to contribute their thoughts to this endeavour. In this regard, TAPMIans have truly demonstrated the evidence for creative interdependence, an important aspect of TAPMI’s mission. I sincerely appreciate the students and the faculty of TAPMI who have made Pratibimb a possibility through their scholarly works, co-ordination efforts and support. I wish the team the very best. Dr. R. C. Natarajan. Pratibimb | April 2012 | 4

Editor’s corner


Dear Readers, We would like to thank all the participants and readers for

Manish Mishra

their valuable contribution. By making this magazine monthly, we aim to provide a platform that will give you more opportunities to share knowledge and showcase your talent by competing with the best minds in the country.

DESIGN & CREATIVES Abhishek Dubey Namrata Mahapatra

Our presence has also augmented due to the popularity of social media. There has been a steady rise in our total audience, including both readers and contributors, and more number of posts have gone viral. The plethora of topics published include learning from management gurus such as Peter








innovation that helped leading brands define themselves better. In fact we encourage our contributors to write about any new upcoming events related to management. For all these amazing contributions, apart from students of TAPMI and other eminent b-schools in the country, we would also like to thank Jaipur Rugs for their article in the current issue. The articles have been selected by the Editorial Team. We


wish to thank all those who helped us in improving Pratibimb through their feedbacks. We would like to take this opportunity to extend our gratitude to all faculty and students


at TAPMI for their continual support, guidance, motivation

Prof. Chowdari Prasad

and inspiration that has helped us to take Pratibimb to the

Dean (Branding and Promotions)

next echelon. To stay updated about the magazine, please like our page on Facebook. Also, send in your valuable suggestions/feedbacks to

Enjoy Reading! Pratibimb | April 2012 | 5

TAPMI , Manipal

Contents Each Aruisan. An Entreprenevr – Need for Svstainable Impact


Daniela F. Gheorghe, Jaipvr Rvgs Fovndation

Marketing: Branding Throvghovt Lifecycle of Prodvct


Ashish Agarwal, FMS Delhi

Effects of Cvltwre and Demographics on National Saxings Rate


Neil Cornelio, XIMR Mvmbai

Usage of Valve Added Seryice (VAS) amongst Yovth and Bvsiness model for Content Proxiders to Target them - Analysis and Svggestion to promote VAS


Svshant S Shrixastax, SIES College of Management Stwdies Mvmbai

Talent Management - Getting It Right


Simone Lobo, XIMR Mvmbai

Sir Volcker xs. Prop Trading


Saxio Fernandes, GIM Goa

Opening vp of Indian Stock Markets for Foreign Nationals – Issves and Implications


Gvrwcharan Singh, Praxis Bvsiness School Kolkata

Svpply Chain Management (SCM) in Healthcare Indvstrz Trisha Pandey, SJMSOM Mvmbai

Pratibimb | April 2012 | 6


Each Artisan An Entrepreneur – Need for Sustainable Impact by Daniela F. Gheorghe, Jaipur Rugs Company As you know, India is an economical paradox. “Why is it that India has some of the richest people on the planet and also the highest number of malnourished children in the world?” was one editor asking in a recent business magazine article. There are more than 3.3 million NGOs registered in India for various causes: poverty alleviation solutions, education, sanitation, birth control, health and others. Yet with 32.7% of its population living in poverty, India is home to around 383 million people who live on less than $1.25/day and they lack education, access to sustainable income, proper sanitation, health services and awareness on hygiene issues. Impact 1st, Structure 2nd

with the level of the need. The governmental and social sectors, considered primary responsible for coming up with solutions & implementation, have emphasized on challenges. The constant search for funding, which allows non-profits to exercise their mission, is one challenge. However, for both the government and non-profits, the most important challenge is again a lack, the lack of good governance: the process of decision-making and the process by which decisions are implemented don‟t always follow the rule of law or most of the times fail to be either participatory, consensus oriented, accountable, transparent, responsive, effective and efficient, equitable or inclusive (as per the complex definition of “good governance” by the United Nations Economic and Social Commission for Asia and Pacific). In this context, the role of the business sector in solving the lack of access to markets – if we see the poor as producers – or to services and products – if we see people at the base of the pyramid in India and other emerging nations as consumers – has been extensively discussed. In the world today, new business models emerge that combine commercial and philanthropic interests and break the rule of a perspective that first defines the sector and then the structure of an organization.

Advice for young starters: focus on finding a solution for a problem in society, and then decide the type of organization you will build.

During my experience with Jaipur Rugs Group, I learned that the problem of the poorest people in India is – in short – the lack of access – to services, products or markets – and it persists as the speed of existing solutions doesn‟t correlate Pratibimb | April 2012 | 7

One of these new models that focus on development impact and output rather than on defining traditional organizational structures is the so-called “hybrid business model”: the non-profit working with a for-profit under the same vision or a cross-sectorial internal-partnership for impact.

A Non-traditional Impact :




What are the major advantages for a non-profit organization as part of a hybrid model? I am discussing this topic in the next lines by taking the case of Jaipur Rugs Foundation (JRF). As a non-traditional non-profit, the foundation was established in 2004 and its reason for existence is: “to catalyze sustainable livelihoods for rural poor to become artisans engaged in the rug value chain in India by empowering them to establish community level enterprises through enhancing their artisanal and business skills”. It is important for it to have a clear mission as it is part of a group – alongside Jaipur Rugs Company and Jaipur Rugs Incorporated (both for-profits) – but works together with the for-profits and players in the same industry. I believe that the most important advantage of the connection with a for-profit is, in general, as well as for JRF, the sustainability of the non-profit`s

Pratibimb | April 2012 | 8

solution for impact. The focus of JRF is on young women living below poverty line. Most of them are illiterate, located in rural, isolated communities, with no access to income. JRF staff teaches them to become independent, confident and aware of their potential and trains them to contribute to the family`s income so that they grow themselves and their community. The JRF`s solution to rural poverty is to ensure access to a sustainable source of income: to create & transform skills into fair income by training low-income people in rural areas in different processes of making a rug. However, poverty and skills can co-exist and the connection to markets becomes the key for sustainability. This is where the strong connection with the for-profit comes into play: JRF can guarantee the connection of trained artisans with manufacturing companies and thus the sustainability of the source of money which can change their lives. The artisans can become part of a production chain immediately

after training. On a different note, the hybrid model can guarantee the existence of minimum funds for the non-profit to continue the exercise for impact. Other funding sources for JRF are of governmental nature and, by uniting funds, the non-profit brings together commercial, public and philanthropic interests to work for the same goal: for rural poor young women to have access to a fair income in their local community. This is one of the best practices of what Accenture describes as “cross-sector convergence for solutions”1. Furthermore, the hybrid model can assure good governance for the non-profit as it pressures the for-profit to adopt good governance practices for 1

the model to sustain. Transparency, participatory approaches and accountability become a necessity for the growth of such a model. The work of JRF under the support programs (see the graphical model) automatically impacts the level of trust that rural producers have in the manufacturing company for which they decide to work. The NGO becomes a representative of the artisans` communities in front of business interests – especially as it creates awareness and offers support for artisans to associate locally. In the same time, the interests of the for-profit pressure JRF to work efficiently and improve the productivity level of the artisans, as well as their understanding of the needs of global markets.

”Convergence Economy: Rethinking International Development in a Converging World” paper

Those living in the poor communities of India or elsewhere clearly do care about obtaining access to clean water, healthcare, education, or income but exactly how these “services” are delivered makes little difference, as long as the services meet the need of the communities themselves. The non-profit in a hybrid business model gains more potential to maximize its development impact and to scale it. And, for sure, the non-profit in the context of Jaipur Rugs Group can grow bigger than the parent-company which supports it. Jaipur Rugs Foundation is catalyzing sustainable livelihood for more than 15,000 rural Indian artisans through rug crafting training, access to income generating activities & support programs. As part of Jaipur Rugs Group, it works for a common social mission: to empower the poor in the carpet industry in India by connecting them with the rich through high-quality products. Online: Facebook/Jaipur Rugs Foundation Daniela F. Gheorghe is a Romanian Fellow in the Corporate Communication department of Jaipur Rugs Group. After a start as Junior Consultant in Political Communication in Romania, Daniela has enriched her experience in the social sector with Habitat for Humanity and, in the last one year, with Jaipur Rugs Foundation in India while gaining an understanding of the social entrepreneurship trends in the Indian context. Resource: for updates and discussion on the business models for development impact, go online:

Pratibimb | April 2012 | 9

Marketing: Branding Throughout Lifecycle of Product by Ashish Agarwal , FMS Delhi Author and management expert Peter Drucker very aptly mentions: “Because the purpose of business is to create and keep a customer, the business enterprise has two – and only two – basic functions: marketing and innovation. Marketing and innovation produce results; all the rest are costs. Marketing is the distinguishing, unique function of the business.” Marketing in its very etymology includes „market‟ and that is what any product or service launched desires to serve. The aim of a business to earn profit is met through its customers and here comes the role of Marketing. Marketing is necessary to realize what products or services may be of interest to customers, and the strategy to use in sales, communications and business development1. An idea is just a potential business. Now to realize the possibility of the conversion from idea to business is where the point of marketing starts. Marketing since inception of the idea of the product or service to be offered is when the curiosity is created in the minds of the customer. Marketing should be treated more as a way to trigger conversations than a “broadcast” channel, marketing has been by far the best way to hone product pitch and improve it too. Marketing during initial phases helps to nurture products, position them strategically, assess the competition, and work 1

toward products‟ development. Moreover it helps in developing product-pricing strategies and monitoring trends. A very generic idea of marketing an idea was displayed by Mark Zuckerberg when he used the faces of students of Harvard University to spread his idea of comparing photos online. Today we all know how that small marketing idea led to creation of one of fastest growing Internet Company with more than 800mn2 users and revenues of more than $4.25bn3 Successful launch of a product is as important as developing it. Devising a Marketing strategy aligned with the Customer and partner needs provide the product much needed recognition and acceptance from its target audience. Various aspects of Marketing in launch broadly involve a.

Market Analysis


Competitor Offering


Targeting Customers


Unique Value Proposition and


Pilot Customers among others.

Assuming that marketing will take care of itself can prove expensive at later stage. Apart from creating awareness about the product it also dictates important budgeting and long-term planning decisions. A successful marketing campaign drives hundreds of first time consumers who in turn spread word of mouth driving other thousands. Today it is common to see Bollywood

Source: Kotler, Philip; Gary Armstrong, Veronica Wong, John Saunders (2009). "Marketing defined". Principles of marketing (5th ed.). p. 7. 2 Source: Adam Ostrow (2011-09-22). "Facebook Now Has 800 Million Users". Retrieved 2011-10-29 3 Source: Womack, Brian (September 20, 2011). "Facebook Revenue Will Reach $4.27 Billion". Retrieved September 25, 2011

Pratibimb | April 2012 | 10

movie makers exploring new avenues to market their product (the movie, its music, its ringtones) during the release of the movie. “Approximately 70 percent of a movie‟s revenue such as theatrical, home video and satellite are impacted by its marketing buzz, so the marketing has to

It is more about making the consumer realize the company‟s unique product proposition that distinguishes it from the competition around. In case the firm deals with products in which the features and customer desires keeps on changing, lack of proper marketing can prove fatal. The

undoubtedly be very effective,” says Studio 18 VP marketing, distribution and syndication Priti Shahani. The table below shows the expenditure incurred in Marketing and Promotion of famous movies made in Bollywood in recent past.

growing market share in Telecom is the youth and realizing the same Airtel has recently launched its „Har ek friend zaroori hota hai” campaign. The campaign catches the youth‟s sentiments and positions the brand in the most vibrant and happening target segment. The campaign has been very successful in getting Airtel the attention and its dominance in the youth market by focusing on the „friendship‟ concept. This campaign illustrates that the fast today's marketer reacts to these change agents will decide the success of their brand.

As the product changes from being introduced to being accepted by the customers, the role of Marketing in growth of product changes from establishing the Brand to creating brand Loyalty and increasing the customer base. At this stage Marketing activities are designed to i) get your potential customer's attention ii) motivate them to buy iii) get them to actually buy

iv) get them to buy again (and again). Pratibimb | April 2012 | 11

In today‟s fierce market competition, relatively similar product quality, and excessive marketing by all companies, the quality of service provided after-sales of the product becomes a major differentiator for any customer. Poor after-sales has more annoying effect on a customer than minor faults in the product quality, as it directly reflects on the customer friendliness of the firm. Apart from customer service, after-sales have also proved to be a source of revenue for many manufacturing firms. Manufacturers of everything from automobiles and consumer durables to security systems and technology equipment have realized that revenues from after-sales product installation, configuration, maintenance, and repairs are around 30 percent of their total revenues, and the proportion is increasing.

Moreover, recent Economic downturn has made everyone realize the importance of after sales service marketing (e.g. Chevrolet Motors) when

imperative to mention that Quality of product or service is quintessential and Marketing can only enhance and accentuate the USP of the product making them more desirable. References:

customer buying sentiments were all time low. During July 2011, when car sales were falling, Chevrolet managed to increase sales by 34%4 . One of the reasons for the increase as mentioned by Mr. P. Balendran, Vice President, GM India is unique value propositions in terms of Chevrolet promise to deliver quality and performance have also contributed to the impressive sales. The promise detailed the 5 year free after sales service the company would provide to its customers, which was core of their marketing strategy during the slowdown phases.


Kotler, Philip; Gary Armstrong, Veronica Wong, John Saunders (2009). "Marketing defined". Principles of marketing (5th ed.). p. 7.


Womack, Brian (September 20, 2011). "Facebook Revenue Will Reach $4.27 Billion". Retrieved September 25, 2011.


Adam Ostrow (2011-09-22). "Facebook Now Has 800 Million Users". Retrieved 2011-10-29.

4. How_to_make_aftersales_services_pay_off_1343


6. Print/248009.aspx


8. news.php?newsid=12234

There has never been any doubt about the

importance of marketing but realizing its potential from inception to conclusion has led to creation of successful Global brands in Ford, Apple or our Indian Brands like Tata or Airtel. The firms have always utilized the Marketing strategies be it 4Pâ€&#x;s, STP or Branding to keep their products ahead of competitors and increase their benefits to shareholders. From Inception of the idea of product or service to its conclusion which covers the whole life cycle marketing has definitive and significant role which is instrumental for market share growth. Realizing the fact many multinational firms have created a Chief Marketing Officer level post at par with other Executive level, to foster and better coordinate the Marketing strategies. At last it becomes 4


Pratibimb | April 2012 | 12

Effects of Culture and Demographics on National Savings Rate by Neil Cornelio, XIMR Mumbai Abstract: Saving is that part of the income which is not being spent and this money could be put to further use. Does culture and demographic environment of a nation play a role in household savings is what this article intends to investigate. This study considers cultural framework of Hofstede involving two main cultural measures Uncertainty Avoidance and Long Term Orientation alongside with demographic measures of ageing population over 65 years and Fertility rate for women. To confirm with my analysis I have considered a case for Uganda which is currently facing economic challenges in generating savings for its investments. Introduction: Germany is paying off Greeceâ€&#x;s debt. Chinese household saving remains high despite of the overwhelming GDP growth. Here is a question, does culture of a civilization really matter to finance managers. I would say it does if analyzed using a suitable framework for understanding cultures. Culture is a system of collectively held values which differentiate a group of people from those out of the group. Savings is the income not spent or deferred consumption. The manner in which people save does depend on culture and underlying factors which give rise to different needs apart from basic needs of survival. Culture thus effects saving and thereby effects the investments which are needed for economic growth and its mere survival. Analyzing few countries growth, saving rate and in-depth study Pratibimb | April 2012 | 13

on Uganda there is a strong correlation between the family making and culture with the economic situation. Ugandaâ€&#x;s low saving rate could be attributed to three decades of post colonial political crisis, series of epidemics this nation faced giving rise to unbelievable inflation rates, deficits which are not being paid off and the unforgettable nightmare that they faced effecting their culture and demographic scenario for ever. This article would provide analysis as to what extent the cultural parameters of Hofstede i.e. Uncertainty Avoidance and Long term Orientation along with demographic factors that affect the saving rates of these countries. Hofstede Cultural Framework: Geert Hofstede in his study of culture attributed the following five parameters of understanding culture 1. Uncertainty Avoidance 2. Masculinity v/s Femininity 3. Individualism v/s Collectivism 4. Power Distance 5. Long Term Orientation Of which the two main parameters which affect the saving rate are Uncertainty Avoidance and Long Term Orientation. Uncertainty Avoidance and the saving rate The uncertainty avoidance index (UAI) assesses how people handle uncertainty, as future events

cannot be perfectly predicted. Some societies socialize their people into accepting or tolerating uncertainty. Members of such societies tend to accept each day as it comes. They will take risks more readily. They are relatively more tolerant of opinions and behaviour different from their own. Such societies can be described as ones with weak uncertainty avoidance. On the other hand, some societies socialize their members into trying to beat the future. As future events cannot be predicted with certainty, people living in those societies tend to have a higher level of anxiety, which may manifest itself in greater nervousness, emotionality, and aggressiveness. Such societies can be described as ones with strong uncertainty avoidance. Cultures ranked high on uncertainty avoidance tend to save less as they prefer to spend all the money with them at present rather than saving for some future use. The members of these cultures do not see savings way to live a better life in future and thus spend the money as quickly as possible. On the contrary cultures ranked low on uncertainty avoidance index tend to spend very less for their current need and they save more for the future need, members of these cultures constantly believe that they have a future and believe in lot of planning for the future. China and India which are ranked low on uncertainty avoidance always have a lot of planning even for small investment decisions in order to perceive opportunity cost pertaining to the decision. Greeks, Portuguese and even Sub Saharan Africa which are ranked relatively high on uncertainty avoidance also tend to save very less. There are a number of reasons for this uncertainty avoidance to have arisen like Greece mainly gains in revenue from tourism and shipping which are themselves very unpredictable sources of revenue, now when the revenue itself is uncertain members tend to spend what they get rather than awaiting another better business opportunity. Sub Saharan Africa faces uncertainty due to other reasons, most countries face an uncertainty in climate, the region is prevalent with epidemics, famines and severe droughts, agro Pratibimb | April 2012 | 14

related economy, in the nineteenth and twentieth century this region has seen a reign of dictatorial governments that followed the colonial mayhem. Like in my personal interaction with members form the Republic of Uganda the core reasons for not saving was “we don‟t trust bank, they may close down as in the past”, “we don‟t trust the stability of our government”, “inflation of 1.2% every month eats away our saving, better spend the money right away”, “ life is short, live each day at a time” and a officer at the central bank told me “you know our countrymen defaults, so we need to have high cost i.e. US$ 25 for them to open an bank account, as people with money are less likely to default”. India, China, Singapore and Germany for instance relatively have stable economies, economic output either being manufacturing or related services which are highly predictable. Members of these economies tend to save more than they would spend as the future is relatively certain. This is evident from substantial degree of negative correlation shown between uncertainty avoidance and the gross national saving which is about -0.57. Long Term Orientation and saving rate Long Term Orientation stands for the fostering of virtues oriented towards future rewards, in particular, perseverance and thrift. Its opposite pole, Short Term Orientation, stands for the fostering of virtues related to the past and the present, in particular, respect for tradition, preservation of face and fulfilling social obligations. China, South Korea, Japan, India rank high on long term orientation members from these cultures always are aware of the future happenings hence they tend to save more rather than spend it right away. In contrast cultures which are low on long term orientation are more inclined to think of the current needs, thereby tend to spend more for short term gains keeping aside only a very little to go in for the saving. In fact there is strong statistical evidence that countries inclined to have a long term approach tend to save more, as shown

in exhibit 2 the correlation coefficient to 0.75 which indicates a strong relation between the saving rate and long term orientation. Coming to primary data on this my interaction with members from sub Saharan Africa (Kenya and Uganda) indicated that these cultures tend to think only of satisfying their current needs which itself is hard to comply due to rising inflation and increased cost so there is only a little them to think of the future needs, hence these cultures are more inclined to think of the current needs rather than keeping the money for future. On the other hand Confucian societies like China, Korea and Japan as per their cultural norms were always made to think of long term situations and back by stable economic growth they were inclined towards long term goals.

substantial amount of earnings helping it grow its investment base to become the second largest economy which in a decade is projected to surpass United States to become the worldâ€&#x;s largest economy. Demographic Factors effecting saving rate: Ageing Population over 65:

This data provides the number of citizens who are above the age of 65. These citizens are not in the current work force and are an expense to the government in terms of pension. Some countries even include additional spending to safeguard the interest of these citizens. A large population over 65 indicates that there are even lesser numbers of individuals who are working thereby governments have a lower source of revenue through taxes. To China, Germany and the Euroland Crisis: make it worse retirement age in some countries like Greece is 55 indicating much lesser workforce Coefficient of correlation between Uncertainty availability. Thus these governments are bound to avoidance index and gross national saving is have lesser saving. If there are more senior citizens in a household, which would mean more expenditure in looking after Uncertainty Gross National Nation these individuals thus eating up into the Avoidance Index Saving saving and thereby declining the saving 9.206 Portugal 104 16.9 rates. This is evident in many countries Italy 75 4.103 Greece 112 like Greece, Italy, Spain and Japan 18.44 Spain 86 where there is an increase in the 53.36 China 40 number of individuals over 65 23.04 Germany 65 delivering a blow on saving which coupled with declining workforce may only get 0.94 indicating a strong negative correlation worse. On the other hand countries like China and between the two variables. India which have less than 10% of their population This indicates that the very cause of the Euro over the age of 65, a huge growing population Crisis is the cultural frame work of the PIGS with a median of 35 and 26 respectively indicating (Portugal, Italy, Greece and Spain) economies that a huge tax pool for the government to meet the rank high on uncertainty avoidance, thereby pension expenditure and subsidies. These backed preferring to spend the money as they earn it. On by low cost of living in many Indian towns and the other hand Germany the third largest economy cities indicates that India has significant amount and a nation unaffected in terms of the series of for saving for future needs. China being out of its downgrades that followed the Greek default and is one child policy indicates that there would be an in the course of the PIGS bailout process, ranks increase in population that would provide enough low on uncertainty avoidance and high on Saving. revenue to the government to offset the Also the strong desire of Chinese to save the expenditure on aging Chinese citizens. In money for future use has helped China save countries of the Euro Zone and United States are Pratibimb | April 2012 | 15

trying to offset this by increasing the number of immigrations of skilled workforce from Asia and Africa, but still there is a long way to grow the major backlog with this regards in the cultural attitudes shown by citizens (citizenship by origin) of these countries and to what extent are they prepared to welcome these immigrants into their society. On top of that, most of Europe ranks relatively high on uncertainty avoidance. As discussed earlier, the members who rank high on uncertainty avoidance tend to be hostile towards persons who are out of their society and some members see outsider immigration is a serious threat to cultural integrity, so this immigration solution still would have a long way to go. United States is relatively low on uncertainty avoidance and already has a huge Asian population integrated in its mainstream workforce and culture making the immigration solution work well for them. The figure below represents the mechanism in which ageing affects saving rates. Fertility Rate:

Another demographic factor seen to effect saving is the fertility rate of women this is evident in Sub Saharan Africa and in some regions of South Asia where there are huge growth in population in the past decades and would continue for at least the next few decades. Fertility rate for women in these countries is as high as 7 children with an average of 5 children born of every woman. With barely any population control and substantial improvement in medical facilities in these nations there has been a strain on the household with one or two earning members looking after large families leaving very little for their saving. Also the increase in population in these less developed countries of Africa and Asia would indicate that there would be more strain on the economy and leaving lesser amount of disposable income with their citizens this would no doubt reduce their saving. In the case of Uganda, primarily an agrarian economy is having a high growth of population which is expected to double in the next two decades. The economy, due to its agrarian nature is not able to grow fast to match up with the increase population. This would lead to higher

Source: From Red to Gray, Chap 3: Aging, Savings, and Financial Markets, pg119, fig 3.1

Pratibimb | April 2012 | 16

inflation and lesser savings. Also these economies would continue this trend to save less and spend more. Conclusion: Culture and demographics indeed shape the economic landscape of a nation. These factors do contribute to a great extent in influencing a personâ€&#x;s spending or saving decision. A personâ€&#x;s habit from one culture or region may differ from a person of another region due to the underlying cultural constraints and demographic pressures. This was evident in case of Uganda and is also evident in many economies across the globe. References: The author of this article has done his summer internship and participated in an enculturation

Pratibimb | April 2012 | 17

programme in Republic of Uganda and the Republic of Kenya from where primary data was obtained. 1.

Cultures and Organizations: Software of the Mind by Geert Hofstede, Gert Jan Hofstede, Michael Minkov


Investment Froehlich


Is the Aging of the Developed World by The International Economy; Winter 2004; 18, 1; ABI/INFORM Complete


by Dr.


Source for secondary data: 1. Gross National Saving Rates Gross national savings 2. Hofstede Dimension Values

Appendix Exhibit 01 Uncertainty Avoidance and gross national saving


Australia Brazil China Costa Rica Egypt El Salvador Ethiopia Finland France Germany Ghana Greece Hungary India Indonesia Israel Italy Japan Kenya Malaysia Netherlands Nigeria Norway Pakistan Panama Philippines Poland Portugal Sierra Leone Singapore Spain Sweden Taiwan Tanzania Thailand Turkey Uganda United Arab Emirates United Kingdom United States Zambia

Uncertainty Avoidance Index

Gross National Saving as a percent of GDP

51 76 40 86 68 94 52 59 86 65 54 112 82 40 45 81 75 92 52 36 53 54 50 70 86 44 93 104 84 8 86 29 69 52 64 85 90

24.92 16.98 53.36 15.94 16.91 10.99 20.72 22.60 18.55 23.04 19.53 4.103 20.52 34.16 33.31 18.90 16.90 23.80 15.55 32.92 25.82 12.53 33.74 13.13 19.84 24.78 16.29 9.206 7.513 46.04 18.44 24.85 32.19 20.03 30.57 13.55 8.56

68 35 46 52

11.84 12.53 17.46 19.65

Coefficient of correlation between Uncertainty avoidance index and gross national saving is -0.57

Pratibimb | April 2012 | 18

Exhibit 2 Long term orientation and Gross National saving

Country China Hong Kong Taiwan Japan South Korea Brazil India Thailand Sweden Australia Germany New Zealand United States Ethiopia Kenya Tanzania Zambia Norway Philippines Ghana Nigeria

Long Term Orientation 118 96 87 80 75 65 61 56 33 31 31 30 29 25 25 25 25 20 19 16 16

Gross national saving as a percent of GDP 53.36 4.103 32.19 23.80 31.7 16.98 34.16 30.57 24.85 24.92 23.04 16.27 17.46 20.72 15.55 20.03 19.65 33.74 24.78 19.53 12.53

Coefficient of correlation is 0.75 indicates a strong positive relation between the saving rate and long term orientation.

Usage of Value Added Service (VAS) amongst Youth and Business model for Content Providers to Target them— Analysis and Suggestion to promote VAS by Sushant S Srivastava, SIESCMS , Mumbai Market of Value Added Service (would refer to VAS henceforth) – VAS is those services that are not part of the basic voice offer and are availed separately by the end user. What merely started with SMS, Information service, Ringtone and Wallpaper features in mid-2000, the VAS industry has now grown to an estimated Market size of Rs 12,200 crores in 2010 With features like Mobile Commerce, Android Applications, Video Calling, 3G, Internet Browsing and Email, the industry is projected to grow at Rs. 48,200 Crores in 2015

Categories of VAS 1.



(Source: ASSOCHAM Financial Pulse Study – Emerging

The Contribution of Value Added Service in Telecom Revenues is approx. 10% in India while in Other Countries like is approx. 23% (Source: IAMAI Paper, Landscape






Entertainment VAS - Services like music, ringtones & games are very popular and have contributed significantly to the growth of VAS in India. Information VAS - Services like information on bank account, news, education etc. Transactional VAS - Enable customers to conduct transactions like banking and payment through mobile phone.


Value Chain Analysis of VAS :

BWA – Analyst Presentation (Reliance Industries Limited, June 2010).

The VAS Industry is currently working on a Business Model whereby the Service provider like Airtel, Reliance etc retains maximum of Margin in the Value Chain of VAS of around 60% while the Content Aggregators and Creators retain average around 15% to 20% of the revenue Margin. Youth & VAS - As per Census 2011, the youth in India from the age group 18 – 39 comprises of 29.66% of India‟s Population out of which 28.84% are literate which gives an immense opportunity to serve 34 Crores of Youth who are Literate. The youth segment that makes up 30 per cent of the total handsets market in India seeks entertainment on mobile. Currently, about 51 per cent of MVAS revenue in India is driven by short messaging service applications. The youth segment will also continue to drive the market, particularly after the 3G rollout (Source: ASSOCHAM Financial Pulse Study – Emerging Landscape in Mobile VAS Industry June 2010).

Pratibimb | April 2012 | 19

Source: TRAI consultation paper no 5/2011 on Mobile Value Added Services pg.17

Content owner/ provider – They are the authors / producers or copyright owners. These entities provide the core content which drives the VAS – which may be owned or sourced by them. Examples include the music companies, movie production houses, media companies, TV channels etc. Content Aggregators - These are the companies that combine content obtained from various content owners and convert it into the digital or any other suitable format

and make it available to technology enablers (value added service providers) or telecom service providers. Technology Enablers - These entities provides a VAS platform, Mobile Application development & hosting, MIS & reporting tools, operator billing, collection & payment settlement engine. The solution prepared is directly provided to the telecom operator.

 

To know the primary motive to use VAS To identify the youth‟s Top 5 aspirational VAS

Research Methodology – Primary research through a structured Questionnaire Target Group – 120 people in the age group between 20 years-30years Typical Profile of the Target Segment:

Youth Profile – They view their mobile phones as a device for surfing the internet and Listen Music Young

Preferred Services: Email, Social Networking, Education, SMS, Basic

Highly Educated

Downloads and Entertainment (Music, Movies, Sports) Age: Mainly 20 – 27 (Young) bifurcated between 20years-23years and 23

Students & Young working

years-27 years. Age group between 28-30 did not respond to the survey Equal mix of men and women, Mostly belonging to SEC A


Majority are post graduate and less are Graduate *The analysis obtained and the survey conducted was a part of Course Project in January 2012

Telecom Service Provider - Telecom Gender Based Analysis: service providers own the access network & Out of the total respondents 48% of the population end users and also provide end-user billing & were male and 52% were female collection for the provision of VAS. Handset manufacturers - In some cases the Mobile handset manufacturers have direct agreement with content owners or VASPs for content which are embedded in the handset or terminal device.

Analysis on Usage of VAS amongst the Youth Segment – India is a Young Nation with 34.56% of the India‟s Population is between the age group 15-39 and Maximum of the population between the I. age group of 20-24. The nation‟s growth and employment opportunities have made the youth more options to explore the Communication medium in a fun way. The following survey* highlights a primary Market research attempting to highlight the top 5 used VAS by the youth segment and an attempt to know their primary psychology to use VAS. Objective/s of the survey 

To identify the Top 5 VAS used by Youth

Pratibimb | April 2012 | 20

Features of Male Population using VAS a. Approx. 60% of the Male Population has Prepaid connection b. Average recharge of more than Rs. 111 per month c. Population having Billing Service has a bill range of Rs 301 – Rs 400 d. They Prefer Using VAS on Laptop / other mediums through PC suite/Apps e. The Usage of VAS is on a daily basis f. Prepaid Connection users prefer basic VAS as they think VAS are Expensive g. The Top 5 VAS used by the Male



Population areii. Internet Search i. Listening to Music iii. Downloading Games and ii. Watching News Updates Ringtones iii. Social Networking iv. Email iv. Internet browsing v. Internet Browsing v. E-mail. The above analysis shows that majority of the In future the Male population would love to users are not post paid users. For those having post have the following VAS paid connection the Monthly bill ranges from i. Listening Music more than Rs. 500 and more. Majority of the post ii. Watching Live Sports paid connection customers feels that the VAS is iii. Watching News Updates costly and they prefer to use it on other medium iv. Internet Search like Laptop, Computers etc. Their preference v. More Social networking Sites shows that majority of the VAS users are internet based hence they prefer Laptop or computer to Features of Female Population using VAS access it. a. Approximately 38% of the total population is having a prepaid Top 5 Value Added Service currently used by Connection Youth Segment: b. Average Daily recharge was Rs 111 and above c. Population having Billing Service has a bill range of above Rs 501 and above d. They usually prefer to use VAS on Laptop or other mediums e. Most of them use VAS on a weekly basis f. The Top 5 VAS used by Female Population are From the above figures The 5 Topmost Value i. Listening Music Added Service used by the target group is in ii. Social Networking accordance to the ranking isiii. Internet Browsing iv. E-mail  Listening Music v. Downloading Videos and  Internet Searching Ringtones  E-Mail g. Aspiration Level of the Female  Social Networking Population describes that in the Future  What‟s App (Chat) the top VAS , the male youth would most prefer would be i. Listening Music

Pratibimb | April 2012 | 21

Aspiration of Value Added Services amongst Entertainment services such as listening to music and Bollywood movies will be adopted by masses. the Youth is The future adoption of Live Sports is in tandem with increasing viewership for all sports such as cricket, soccer, formula one and tennis. Future adoption relates closely to the current awareness levels of consumers. Trends depict a growing demand for entertainment services like listening to music and watching movies over mobile. These are followed by high potential information based VAS such as news updates and medical services over mobile. The 5 Topmost Aspired Value Added Service used by the target group in accordance to the Analysis of Percentage increase or decrease in ranking isValue Added Service

The difference between Current and Future Analysis of usage pattern of Value Added Service shows that the following VAS has the highest percentage of Jump in terms of percentage of users switching for other Value Added Service Purchasing online for Products – 480%  Taking Medical Advice – 466%  Stock Market Trading – 337% Bill Payments – 315% Check Bank Accounts – 300% 

    

Booking Movie Tickets Bill Payments E-Mail Check Bank account Internet searching Browsing

Pratibimb | April 2012 | 22

 

Medical Advice VAS has the capability to allow the deprived sections of society to access quality

medical advice at an affordable price. It is expected that the share of wallet of healthcare for an average Indian household would grow at a CAGR of nearly 9 % (from 2005 to 2025). Surprisingly, VAS of medical advice from doctor has good awareness level of and people who want to adopt it at a later stage are increasing by 466%.

shows that the product designing and pricing has to be matched accordingly and promoted in a different manner. Consumers Psychology in Buying Value Added Service:

Analysis of Frequency of Usage of Top 5 Value Added Service�

As per the data the users usually are bifurcated between Everyday and From the above analysis the Target Group is very Once or Twice a month. Mostly the male users are much comfortable in using vas as 53% of them Listening to Music Every Day Between 1 or 2 day Once in a week Once or twice in a month Other (Not using, other options) Total

Internet Search / Browsing


Social networking sites

Chat (e.g. What’s App)


% of Respondents


% of Respondents


% of Respondents


% of Respondents


% of Respondents

29 12 10 28 22 101

24.17 10.00 8.33 23.33 18.33 84.17

29 10 11 13 2 65

24.17 8.33 9.17 10.83 1.67 54.17

28 9 7 13 2 59

23.33 7.50 5.83 10.83 1.67 49.17

27 7 11 12 3 60

22.50 5.83 9.17 10.00 2.50 50.00

23 5 7 10 1 46

19.17 4.17 5.83 8.33 0.83 38.33

believe that they find using VAS very convenient, using it every day and Female population mostly which is followed by the TG feeling that it saves uses VAS once or twice a month. time and help them to be updated. Since the service From the above analysis and the previous analysis is a low involvement and is based on cognitive on gender we can conclude that the Majority of attitude of the customer, the user is following a Males who use top 5 Value Added Service are Low thinking sequence of do-feel learn quadrant of using VAS everyday basis. And majority of the FCB grid (Vaughn, 1980, 1986). Females use VAS, once or twice a month. This Pratibimb | April 2012 | 23

Purchase with the advent of technology and 3G where they would be more curious to try and would need more variety to save time. The data also states that the users who is currently uses it or who find convenience to use VAS, wants to try more or less the same VAS and Majority people being a prepaid user. So there is a scope to promote VAS keeping in mind the kind of user (pre-paid or postpaid) If we plot the above responses in the Baumgartner Suggestion Model for the VAS companies to (Baumgartner 2002) model mentioned below the target Youth segment for VAS Value Added Services fits into the MVAS industry is at a nascent stage and it still has to receive an „Industryâ€&#x; Status. They are not Functional Purchases. The plotting is shown currently regulated or licensed and they mainly are below the service partner of various categories of VAS. They are termed as OSP (Other Service Providers). Baumgartner 2002 Model Giving the Content creators their due and Keeping in mind the boosting of revenues for both the business model, the following model can be used on off-deck basis starting with the Youth Segment Spontaneous

Low purchase Involvement

Spontaneous Purchase: So we can conclude that at a later stage when the TG aspire to have all the VAS especially the prepaid users, Pricing and positioning strategy can play an important role in marketing the product. As the consumer is moving towards Exploratory Pratibimb | April 2012 | 24

Bundled Service – The top 5 value added service can be delivered accordingly by following the Revenue Sharing Model. Here the services can be priced off deck model, if customer orders through internet /GPRS / 3G. The plan in the table ( refer next page) can be jointly promoted with the Service provider on contractual basis with different Value Added Service provider. This kind of agreement will give boost in Competition and different VAS partners

Off deck Content Revenue %* What Customer Pay for

Off deck Content Revenue Price* Rs 150 + per month for 1GB and 25 Mb free, post

top 5 VAS Content Owners


that 10 paisa / 10kb Rs. 37.50 Per user

Content Creator


Rs. 22.50 Per user

Content Aggregators


Rs. 60.00 Per user

Service Provider


Rs. 52.50 Per user

(+) Cost of SMS

Rs. 3/ SMS (If ordered through SMS)

(+) Taxes as per GST „12 In Off-deck content, the VAS Provider sells content directly to subscribers. The content can be provided either through the operators' portal or through their short code.

for different type of Content. The offering of these services could also customized as the charges levied overall on user will be less as the competition amongst content will eventually decrease the cost of application provided by the VAS providers.

on the Social Media space and other online portals. be Bibliography the  PWC. Connect with Consumers Value Added the Services: The next wave. PWC, March 2011 the 

The positioning of these services could be on the basis of convenient service and Rates where the  promotion would be mainly Above the Line focusing on TV ads, College Promotion and BPO‟s where the target group is maximum in number and would be given at half the price for the Closed  User Group Customers Conclusion:

As per PWC report Students will comprise around 28% of the estimated mobile subscribers‟ base in 2015. Students are expected to be the highest consumers of most VAS services based on future adoption levels. This can generate additional  revenue of Rs. 1411 crores in 2015. The total revenue from information services is expected to reach 7,953 Crores by 2015.

TRAI Consultation paper on Mobile Value Added Service, 21st July 2011 Deloitte, ASSOCHAM Mobile Value Added Services (MVAS) - A vehicle to usher in inclusive growth and bridge the digital divide January 2011 PWC, CII-MITSOT report Beyond voice and Text Teletech 2011, January 2011 Ernst and Young, FICCI report Enabling the next wave of telecom growth in India Industry inputs for National Telecom Policy, 2011 IAMAI report, Towards a liberal Mobile Value Added Services Regime Approach paper submitted by the Internet and Mobile Association of India to the Ministry of C ommuni cati ons and Inf ormati on Technology, March 2007

So a combination of Top VAS used by the Youth segment and bundling at a competitive pricing will make the youth feel more attracted towards using it and the Gender specific usage pattern can be Reference Books Naresh Malhotra book on „Review addressed through effective promotion through Marketing Research‟ Volume 6 Above the Line Marketing strategy and keeping in mind that they are low involvement products. The internet usage of these consumers need to analyze which will provide the company to market Pratibimb | April 2012 | 25


Talent Management – Getting It Right by Simone Lobo, XIMR Mumbai Financial capital earns no gain without human capital. Even the 4 Ps of marketing i.e. Product, Price, Promotion and Place, require a 5th i.e. People. The corporate landscape today is witness to hits and misses through M&A‟s and crashes and burns with the economic crises the world over. Uncertainties lurk within organizations and the environment around. In the haziness of the abstract scenario in the business world, silhouettes of people stand out. They come alive and quieten the din. It is people that take life-altering decisions, help restore organization health and put pieces of the puzzle back together.

HR today has come full circle, with shareholders now concerned not only about annual report figures but also what‟s happening on the shop floor. The key to carrying the baton of organizational success forward is innovative practices in talent management. It is essential today to ensure that new recruits are a cultural fit and uphold the strongly held organizational values. The founders of successful organizations leave behind a legacy that is entrusted in the care of generations to come. A striking example of an organization that is known for its exemplary values is the Tata‟s.

People are priority: People are an organization‟s corner-stone on which its foundation firmly stands. A breakthrough innovation, a cutting-edge product, a world-class leader – people make it possible. And behind every successful corporation are its people. Business intelligence and competitor analysis are enhanced by technology but enabled by people. Values are disseminated by top management and imbibed by new entrants of a company – again an exchange through people. At every step of organizational life – hand-holding, enculturation, learning and development, career growth, employee engagement – people initiate and facilitate. The changing face of HR: Enter Human Resources, and the task at hand seems daunting. Laying to rest misconceptions of a „9-5‟ job and „fun‟ work life, HR is here to deliver and demonstrate its impact on bottom-line results. Pratibimb | April 2012 | 26

HR strategies make tangible results visible. A good induction programme, valuable training and positive re-enforcements like career growth opportunities go a long way in setting a positive trend with the promise of a future in the company. Providing a safe work environment and fair compensation are other important areas. Through leadership coaching and mentoring, employees are given the encouragement to initiate, freedom to create and empowerment to inspire. HR helps make the voice of employees heard through the Voice of Customer (VOC) report. It is the pulse of an organization and is adopted by many businesses today. With regard to employee engagement and welfare, many aspects need to be considered e.g. work-life balance, trust and respect, job security etc. Open communication is the need of the hour. Management by walking around, open-door policy and town-hall with the CEO are some of the practices followed in organizations today. It helps connect with and understand the needs of an

organization‟s internal customers – its employees. The protocol followed by many effective HR practitioners is never to compromise on quality. A concern of highest regard is to follow Standard Operating Procedures (SOPs) and relevant laws applicable from time to time. Motivation matter:

Source: http://


The common thread that binds employees to the company and prevents them from switching loyalties is motivation. If we look at Frederick Herzberg‟s two-factor theory, it talks about motivators and hygiene factors. Motivators are the intrinsic factors that motivate an individual e.g. higher responsibility, recognition etc. Whereas, hygiene factors are the extrinsic factors that don‟t motivate if present but their absence leads to demotivation e.g. salary and other benefits. Taking this forward, we will look at innovative practices being followed by organizations presently to attract and retain talent. With the veil of economic uncertainty imminent today and looming large, monetary gains like increments have taken a back-seat. This has led many companies to turn to newer approaches of preventing people from changing jobs.

In times of inflation, altered lifestyles, the onset of new illnesses and subsequently burgeoning medical expenses, the above seems to be an excellent proposition. Although it falls within the gamut of medical benefits in the construct of compensation, it is a welcome step towards employee attraction and retention. A stride in this direction could take companies a long way. Whether packages such as these help the companies in actual talent management remains to be seen. It is for employees to recognize the access to such benefits and appreciate them as instruments of employer care. “Whatever be the reason, healthcare is no longer a hygiene factor for companies – it is now a conscious retention tool.” (Sengupta, 2012)

The employee lifeline: The fitness test – internal seems the best: “This year, a healthy employee will be the sign of a wealthy one”. Current examples of organizations that “have started betting on health and medical benefits to rein in as many as possible from shifting loyalties” are Wipro, Tesco, Philips and Intel. “They are also looking at attracting talent with a revamped medical benefits package.” (Sengupta, 2012). This is evident through the illustration below. Pratibimb | April 2012 | 27

Most employees have access to information on Internal Job Postings (IJPs) through the company intranet. While external consultants help gain access to a pool of qualified talent fit for the job, “some organizations are adopting innovative ways of filling job postings through internal headhunting of premium talent. This serves two purposes. One, the organization gets the best

candidate for the job posting while enabling it to retain key employees and, two, employees get a better posting, for which they would have otherwise looked outside the group.” (Singh, 2012) Examples of companies with such initiatives are many. Different companies have different criteria that need to be met before an internal candidate is considered for a role. The process adopted by each company also differs. “In the 20,000-strong Essar Group, 200 people have so far benefitted from the HR initiative. There is a seven member team which identifies high-potential talent within the organization and, like any other external headhunter; it reaches out to such employees to offer them a host of opportunities within the group. The understanding is that the employee should have completed a minimum of two years in the previous role.” (Singh, 2012) Candidate fitness to the role is of prime importance. Persuasion also helps employees consider jobs available internally, that they may have previously not contemplated. At times, there are separate people from the recruitment team assigned to handle requirements of such a nature, on an on-going or project basis. “Santrupt Misra, CEO, carbon black business & director, group HR, Aditya Birla Group, describes his group's initiative in this direction as an internal talent management process which works as a virtual head-hunting team. „There are many examples where people have been actively influenced and persuaded to look at a role that they would otherwise have not thought about‟, he said.” (Singh, 2012) Today, it is not very easy to acquire the right people for the right job at the right time. Competition is fierce and with companies offering swanky roles and lucrative packages, the potential candidate is sometimes driven in the opposite direction. Time is of the essence especially when it has a direct impact on business and bottom-line results. “Marc Effron, president, The Talent Pratibimb | April 2012 | 28

Strategy Group, believes that internal headhunting is the right approach in a talent-scarce world. „You should check what's in your own cupboard before taking a trip to the market. Internal headhunting is advantageous in three ways. Firstly, internal candidates are far more likely to succeed, since they've already been vetted for cultural fit and performance. Two, it sends a powerful message to the organization's employees that there will be opportunities to grow and develop. And, three, absence of such opportunities is proven to decrease employee engagement and increase turnover of a company's high-potential leaders. However, the only area of caution is to realize that internal talent might not be the best fit for every opportunity‟, said Effron.” (Singh, 2012) HR innovation vis-à-vis employee inclination: Apart from verifying employee fitness for an available position internally, it is important to check employee readiness for such an opportunity. While in-house head-hunting presents a platform for employees to traverse organizational businesses and offers a great deal of exposure and learning, there exists a fine line between employee fitness for a suitable role and their readiness to take up the same. Having said this, the efforts taken up by organizations in this direction are truly commendable and open doors to endless possibilities. Such innovative avenues should be respected. Think talent management – think avantgarde – seems to be the mantra today for planning and executing talent management programmes effectively. Recruitment etiquette: Recruiters today need to be well-informed. Apart from role clarity, it is important to ensure that compensation parity exists among team members. This is crucial and must be done with the help of benchmarking and other tools. HR needs to be aware of headcount as per budgeted manpower plans. There also needs to be robust interviewing mechanisms in place e.g. resume screening,

personal interviews, group discussions, case study/ article writing, testing etc. It is essential to have a candidate pipeline and it is extremely vital for HR to connect with potential candidates on a regular basis, so that time is uncompromised. A clear understanding of the career growth prospects for a given role under consideration must be charted out in detail. Candidates today are keen to know their future role within the company. When considering a candidate for a given profile, his/her resume serves as a yardstick that enables decision-making. While past laurels do not guarantee a successful future with the company, they serve as a guide nonetheless. “A person‟s past job performance is the surest guide to future performance. The right education + the right experience + a compatible personality = a good fit.” (Luecke, 2002). Today, reference or background checks play an important role in the recruitment process. With many reported frauds, certifying credentials of new entrants helps ensure that the necessary checks and balances are in place. This also lowers the risk that companies are otherwise faced with when they encounter a situation of this nature. Employment errors: There are certain hiring mistakes that companies often commit. Falling prey to the pressures around, they are then trapped with employees who are either high maintenance or lack diversity. To understand this further we consider 2 aspects – “desperately seeking the hottest prospects and hiring in your own image.” (Luecke, 2002). Such decisions can prove to be ill-suited to the role requirement in the first place. “Winning the hottest prospects may cost your firm more than it can comfortably afford. Their educational or professional background may be more than what the job in question actually requires. They may be so confident of their desirability that they won‟t bring a healthy dose of appreciation and gratitude to their new job at your firm – and they‟ll always have one eye out for the bigger, better Pratibimb | April 2012 | 29

deal.” (Luecke, 2002) The second aspect focuses on the importance of workforce diversity. It is a concept that many organizations today are fast embracing. “Another all-too-common mistake is to hire people just like you. Many managers assume that they can build strong teams by gathering people who all have the same strengths and personalities – those defined by the managers themselves. But diversity in personality, work styles and decision-making approaches creates richness in a team‟s culture, increases the group‟s chances of generating creative ideas and solutions and lets members complement one another‟s strengths and make up for one another‟s weaknesses.” (Luecke, 2002) Personalized attention: Today, companies offer various opportunities, with part-time, contractual and temporary employment on the rise. HR is then faced with an uphill task of managing such employees. “Retention is especially challenging when the workforce is highly diverse. One-size-fits-all strategies for keeping good people simply don‟t work any longer. Companies can best improve their retention rates by crafting creative, specialized strategies for each major segment of the workforce.” While a contingent workforce presents an organization with advantages like flexibility in work timings and affordability, they have a down-side that cannot be ignored. The challenges include a high turnover witnessed among such employees, a lesser degree of loyalty towards the company and a demand for similar benefits accrued by a company‟s regular employees. (Luecke, 2002) The happiness quotient: If the business environment today is a battle field, employees are its arsenal. They breathe life into an organization‟s existence. Hence, attention to talent management becomes paramount. With companies foraying into unexplored terrain, the responsibility

of hiring right rests with HR. And it doesn‟t end there. Entry into an organization is just the beginning of an employee‟s journey – the duration of which is determined by the quality of HR and the success of their practices. Talent attraction, retention and growth are inter-connected. As Abraham Lincoln said, “Be sure you put your feet in the right place, then stand firm”, it is important for an organization to have sound talent management practices. A Confucius saying goes thus – “Ability will never catch up with the demand for it”, so also when HR is faced with niche requirements and talent shortage, therein lies innovation. It is the breeding ground for future thought and action. All aboard the talent management bandwagon, ahoy!

insurance-medical-benefits-high-premium 

Website: 

Sengupta, D. (2012, February 17th). Cos Wipro, Philips, Intel and others line up huge changes in medical benefits to attract talent. Retrieved March 26th, 2012, from http:// http:// -02-17/news/31071292_1_medical-

Pratibimb | April 2012 | 30

Book: 

References Articles:

Singh, N. (2012, February 17th). Headhunting goes inhouse at companies like Essar, L'Oreal and others. Retrieved March 26th, 2012, from http:// http:// -02-17/news/31071281_1_head-huntingaccord-group-india-hr

Luecke, R. (2002). Harvard Business Essentials - Hiring and Keeping the Best People. Boston: Harvard Business School Publishing Corporation. Pages 8, 27, 69 and 70.

Sir Volcker vs. Prop Trading by Savio Fernandes, GIM, Goa “Rest Assured Sir, Just wish us Luck” says the big banker to his customer .If the deal turns sweet, it‟s the bankers to praise and if it doesn‟t well they are “Too Big to fall”. This very stance of power and autonomy achieved by these institutions is what Paul Volcker is adamant about ending but then who is Paul Volcker and how is he planning to do so? Paul Volcker, is an economist and former head of the Federal Reserve who currently heads President Barack Obama‟s Economic Recovery Advisory Board and is credited with ending the high periods of inflation during the 1970‟s and 1980‟s. But then he is more famous among the biggies of the financial markets because of the “Volcker rule” established by him. Wiki states the rule as “a ban on proprietary trading by commercial banks, whereby deposits are used to trade on the bank's personal accounts, although a number of exceptions to this ban were included in the Dodd-Frank law”, such as the municipal, Treasury and federal agency securities. The rule's provisions are scheduled to be implemented as a part of Dodd–Frank Wall Street Reform and Consumer Protection Act on July 21, 2012 and were publicly endorsed by President Obama on January 21, 2010. (Refer Figure 1). There has been a constant tussle between the Regional Bond Dealers Association being supportive of the rule while the Securities Industry and Financial Markets Associations oppose this provision. "The Volcker rule remains highly problematic and is likely to have the unintended Pratibimb | April 2012 | 31

consequence of constricting market liquidity, as evidenced by the fact that Treasuries, agencies and munis are exempted," said Michael Decker, managing director and co-head of municipal securities at SIFMA. Let‟s delve deeper into the various provisions and technicalities of the rule and leave such decisions to the avid readers. The financial industries started off with the banking industry and investment banking being at bipolar ends but as time passed these were brought under a common umbrella holding for e.g. Citibank has retail banking as well as an investment arm though the line has blurred being under the same cap. Let us rather use the term investment banks to generalize the commonality between the bank and the investment arm. The main motive of such banks is to make a market for themselves (market-maker) to survive in terms of the services offered (trading stocks, derivatives, currencies, loans in capital raising etc.) .Say, a new trader decides to sell his shares through private placement, since his repute is limited, there would be few takers but then suppose an investment bank say Citibank agrees to purchase the shares and then sells the same at a marginal profit, it would definitely lead to quick liquidity. This is the basis of proprietary trading which has come to the phase wherein banks employee traders devoted to the sole cause of trading though now with more focus on profits. These proprietary desks usually have the highest value at risk compared to other internal divisions. Many famous financial entities belonging to the 2007-08 crises have been known to garner a significant portion of their annual profits through the means

described. History speaks of traders such as Brian Hunter who brought down the hedge fund Amaranth Advisors when his massive positions in natural gas futures went bad The Federal Deposit Insurance Corporation (FDIC) provides deposit insurance, which guarantees the safety of deposits in member banks, up to $250,000 per depositor per bank similar to the DICGC guarantee of Rupees 1 lakh in India. Thus banks were basically handed a silver platter for proprietary trading knowing very well that any loss would be stalled by the government, in short a Win-Win situation. In contrast financial entities such as Goldman Sachs, speak of the huge reduction of liquidity in the US equity markets as well as international bond markets. Another issue lies in the operation difficulty of distinguishing “permitted” activities such as underwriting, hedging, trading of government securities etc. from the restricted ones. This entails additional spends on technology and infrastructures by banks to comply with these rules thus claiming these as higher fees for the corporate customers. Ponder on the following example. The same banking entity as before, acting as a market maker, has purchased one of the several 40,000 corporate bond issues in the U.S market and wants to resell the same though a match is not readily found. During this holding period the bank can experience risks such as counterparty risk, price movement risk etc. But then when the bank is able to liquidate the same and it so happens that at a profit, the question is “Is it a form of proprietary trading?” The repercussions have been felt on the Indian Soil too with the Reserve Bank of India becoming ever more cautious towards such trading firms who seldom divulge their contact information. Recently the finance ministry imposed a ban on proprietary trading by finance arms or group companies of foreign banks and a complete restriction on foreign direct investment (FDI) in Indian finance companies that only trade in Pratibimb | April 2012 | 32

financial assets on their own account. Sources also speak of a rejection of about three to four proposals regarding proprietary trading in India, from firms such as Morgan Stanley India Company Pvt Ltd and UBSSecurities India Pvt Ltd. Domestic banks are not allowed proprietary trading as a standalone activity but are allowed to do so through separate subsidiary or a joint venture though the maximum market exposure cap stands at 40%.Currently FDI is allowed foreign investment promotion board (FIPB) channel while 100% FDI through the automatic route is permitted in 18 other NBFC activities. This has been viewed by the RBI as a “clear possibility of regulatory arbitrage: by foreign investors for then can directly pump in their money into these firms without having themselves subject to the regulations of SEBI. This uniform amount of higher capital inflow can subsequently weaken the Indian rupee thus harming the nation. Rough estimates during the April-June 2010 period state that nearly 24% of total trading on the stock market was a part of proprietary trading. On a different perspective, we are limiting a huge chuck of the bank‟s assets which could be used for the trading activities benefiting not only the bank but also the customers through lower transaction charges. True we already have Capital adequacy ratio based on the BASEL norms which restrict reserves in bank but a ban on proprietary trading may actually increase the systemic risk by accumulating assets into the banking system thus only fuelling the too big to fail scenario. The new norms release by RBI for banking licenses states that a minimum capital of 500 Crore needs to be held hence the banks will lose a significant amount of returns which could be passed on to customers. Overall ,calling for a sudden closure of such trades leads to a huge increase in the bank‟s administrative costs such as costs of regulatory compliance ,which would be passed on to consumers thus making capital investments costs

much higher in turn affecting the GDP negatively. Studies state this as an additional 6.6 million work hours coupled with 1.8 million hours per year for enforcement. It would also entail an additional 3000 employees per bank along with a cost increase of around $350 million. The effect may also make foreign interest rates attractive thus affecting trade and devaluation of the domestic currency. Small time firms and startups would also be left devoid of funds due to these high fees and interest rates. In conclusion it can be said that these regulation don‟t merely remove risk but simply transfer it. Say a company that would be protected by hedging strategies used by a bank may now undergo currency risk, operational risks, currency risks etc. Of course the end customer seems to be at a loss but then frequent financial crisis such as the collapse of MF Global Holdings Ltd, attributed to proprietary trading, left the authority no other option but to tighten the regulatory cords which come into effect post July 21, 2012.

Pratibimb | April 2012 | 33

References: Articles:  EBSCO database with search on articles referring to Volcker rule  SB100014240529702043948045770120619 70129588.html Websites:  glasssteagall-act-and-volcker-rule   ban-fdi-in-proprietary-trading-rbi.html  Economic Times

Opening up of Indian Stock Markets for Foreign Nationals – Issues and Implications by Gurucharan Singh, Praxis Business School, Kolkata

The very first day of the year 2012 brought happiness and smile on the face of the Indian financial markets, when government opened up the opportunities for the foreign nationals to invest directly into the Indian Stock Markets, which until now was not possible. It being a topic of heavy speculation, the experts have opined that if everything goes well, then Indian Stock markets would see a significant foreign inflow which will bolster the economic growth of the country and would add to the stability of the markets. The main aim of this opening up is to widen the investor class and attract more funds which would help to deepen the Indian capital markets. It is said that stock market indices are the barometer of the country‟s economic growth, and in our country the two main indices are- SENSEX and NIFTY- SENSEX is the basket of 30

shares. After the subprime crisis when the world economy was recovering, India showed strong positive growth and especially in the year 2010 there was a huge foreign inflow of about $ 29 billion which made Sensex grow by 17%. But reverse situation was seen in the year 2011 where a net outflow of $ 380 million was seen from the Indian markets, forcing the rupee to slide down by 24% in its value against dollar. Earlier a foreign individual or the concerned investor could not invest directly into the stocks, all they were allowed to do was to open up a demat account with SEBI, FIIs and to invest in the securities indirectly by way of mutual funds or through P-Notes (Participatory Notes: an instrument which derives its value from an underlying financial securities such as an equity share) for those who were not registered with SEBI. But now there could be direct investing in equities by:   

foreign individuals pension fund trusts and other associations

All these investors are called „QFIs‟ or (Qualified Foreign Investors). This particular move is expected to lure wealthy investors both individuals and organizations from over and above 80 countries who will be eligible to invest as QFIs. *Source: Google Images

companies‟ shares and NIFTY of 50 companies‟ Pratibimb | April 2012 | 34

But there is a cap on their holdings in the Indian market. These QFIs can own up to 5% of Indian companies and cumulatively they can own up to

10% of the Indian companies. The other important point here is that Indian companies having significant foreign holdings like ICICI Bank and HDFC Bank, where the foreign holding according to the stated norms is reached, would be inaccessible to the foreign investors.

example: Terrorist funds could very well flow into the markets which would be detrimental to the society as a whole. Implications of the opening: The step taken by the Government as a whole looks optimistic and emit positive vibes, thus lot of positive implications can be seen like:  

Issues & Implications: Issues related to the opening: It becomes very difficult to enlist the issues related to the concept which is new to the market, but here are some issues listed based on the forecasting of the market experts which can arise in due course of time: 

It is being considered as hot money in the market & hence can have a negative effect because it can move out of the country as freely as it came in. The reason behind this could be: any vibrations in the global markets and foreign investors move out. Now this can really create problem for the Indian markets, as funds outflow from market would invite a fall in the markets and this fall could be sharper than what was seen in the past. Though it seems that it gives an adrenaline rush to the investors to invest but it must be remembered that money would not flow in immediately as global economic conditions would remain volatile for some time and foreign investors will wait for quality offerings like that of Coal India in the year 2010. As retail investors would participate in large numbers the KYC (Know Your Customers) procedures would be complex and could pose a problem, for safety measures. For

Pratibimb | April 2012 | 35

It will boost investor‟s confidence in the Indian markets. It will help Indian Government to counter the increasing perception of policy paralysis, which would directly affect the economy in a positive manner. It will also help the Government to solve the problem of nation‟s widening current account deficit. The other critical point is that until now only institutions were investing in the Indian markets and hence they only knew the companies and regulatory bodies, but now this measure will let retail investors know about the Indian companies, that is how big it is and what are their business, which can further improve the chances of exports, along with better representation of India Inc as a whole. The most important implication which is expected is the resurrection in the value of rupee against the dollar.

It can be said that, this is one of the crucial steps taken by the Government of India to address a series of issues in India, be it related to the economy growth, or the devaluation of the rupee against the dollar, or ill effects of inflation and ill effects of curbing inflation which caused the nation to compromise with the GDP growth. Whatever the case may be, it can be said that the opening would do good to the stock markets only and only if the sentiments of global market doesn‟t fluctuates heavily. The other thing which is to be taken into account is that, if the stock markets tend to provide good investing prospects to the foreign

investors, then only the market can expect the kind of inflows which it witnessed in the year 2010. It is yet to be seen that if the move can actually bring in the funds to the extent it is predicted or not and if not, then what would be the probable reason for it. Not only that it is also to be seen that how would the Indian economy would fare in the coming fiscal given the problems of rupee fluctuation, inflation threat and other political issues. All we can do is hope for the best. o r e i g n - i n v e s t m e n t - i n indian.html#axzz1jz49xE10 markets/stocks/market-news/India-opensstock-market-to-foreign-investors/ articleshow/11326902.cms

References:  report_stock-market-may-open-to-foreignindividuals_1449880

Pratibimb | April 2012 | 36

Supply Chain Management (SCM) in Healthcare Industry by Trisha Pandey, SJMSOM Mumbai

Healthcare spending accounts for substantial share in Gross Domestic Product (GDP) and has increased rapidly over the years. Rising healthcare costs has become a major concern not only for individual

incompetents, costs are bound to rise and that too inexorbitantly. Considerable amount of cost saving can be made through filling the gaps in healthcare supply chain and the savings made can then be transferred to

Figure 1. Healthcare Supply Chain

patients or their families but also for companies and for governments all over the world. This is primarily because companies have to provide allowances for healthcare expenditures of their employees and governments. In the present day environment marked by resource

patients in form of reduced bills.

Delving deeper into finer details of entire supply chain of Healthcare industry, some glaring issues that come to fore. This article discusses about some of these glaring inefficiencies. These include:

Figure 2. Inefficiencies in Healthcare Supply chain

constraints, hospitals work under the pressure of limited investment budgets and are compressed between two-sided wall of quality and cost. Healthcare costs are rapidly increasing and have become unsustainable .One area that has tremendous potential to arrest the rapid increase in healthcare costs is Healthcare Supply chain. Supply chain strategies are important to realize the competitive capabilities. As long as supply chain remains disorganized or Pratibimb | April 2012 | 37



Misalignment of interests: Misaligned interests of multiple healthcare agents such as hospitals, doctors, insurance companies and regulatory bodies. Supply-intensive Procedures and Insulated Silos: Like joints or hip replacement etc. where supplies constitute a

substantial portion of the total cost of the surgical procedure. Multiple players in healthcare sector work in their own silos under a sense of competition without realizing that at some points collaboration can give them better cost advantage than competition  Paper Records: To a large extent purchase orders and transactions are monitored manually through on-paper records. This results in inefficient monitoring of inventory levels due to increased errors between actual numbers of medicines, equipment etc. and numbers in book. Eventually the result is either excess inventory carrying costs or stock-outs. On one hand, high level of inventory carries risks of expiry and on the other hand stock-outs in healthcare sector imply immediate loss of customers or patients. Agency Theory and Gain-sharing Model: Most of the times, the interests of healthcare agents are misaligned and this may conflict with each other. A doctor who has been trained to use a particular product or equipment would not find any personal incentive or motivation to undergo a re-training in order to switch to a low cost equal functionality substitute. This results in prolonged use of old technologies and products and is also sometimes referred to as ever increasing “legacy tail”. The gain sharing model handles such alignment issues by sharing of gains among healthcare agents through incentivizing cost reduction techniques employed by any of its agents. The implementation of such a model has following basic requirements:  Transparency of the model among the concerned healthcare agents  Establish Cost and Quality thresholds  Identification of actions that can result in cost savings  Development of framework or measures of Pratibimb | April 2012 | 38

  

incentive models based on quality metrics , resource utilization and cost information Mapping of cost saving actions quantitatively to incentive models Smooth transitions from old to new approach or techniques Sustainability of the model so that gain sharing model does not collapse within a short timeframe

However the implementation of such gain sharing and incentive models has its own challenges in terms of monitoring the quality of patients‟ care and delegation of power and responsibilities. Supply-intensive Procedures, Insulated Silos and Economies of scale: The supplies required for procedures like joints or hip replacements are basically of two types: 1.

Those that are common to all such types of procedures i.e. common place supplies and


Those that may vary depending upon type of patients being treated i.e. customized supplies

These supplies are extremely expensive in terms of equipment cost, sourcing, procurement and storage. Also most of these procedures require revisions after a certain timeframe due to wear and tear or some misfits that arise in due course. These revisions are even more costly. The foremost requirement is the standardization of equipment required across different surgeries. This can be achieved only through collaborative efforts by healthcare professionals across the industry to reach certain common must-follow surgery norms. Once this is achieved, healthcare providers within an optimum geographical distance can forecast and pool in their requirements of such equipment together. They can then go for collective vendor analysis, vendor selection, purchase order placements, procurement and payment. Procuring

volumes from a common vendor would help draw benefits of volume discounts and would also provide easier access to new technologies. This can help achieve economies of scale and can also bring down the total number of intermediaries substantially. Cost savings thus accrued can be passed on to final consumers or patients. Paper Records and Automation: Employment of techniques like computer-based patient record systems (CPR), electronic medical records (EMR), computerized physician order entry (CPOE), picture archiving and communication systems (PACS) etc. has the potential of substantially reducing duplication of records as well as the manual effort required for handling such records. This will free up healthcare

Pratibimb | April 2012 | 39

professionals for more important activities like frontline patientsâ€&#x; care. The transactions done online will automatically keep the database updated corresponding to each and every issue of material or medicine etc.; thus monitoring inventory levels efficiently. Automatic product replacement mechanisms will completely eliminate the need of manual counting and manual placement of the order. The need is to gradually fill the current gaps in supply chain so that healthcare does not remain a distant dream for people - particularly those belonging to the low and middle income groups. Some can also this as just another method of bringing in social equity.

Introduction `Does the stock market overreact?' De Bondt and Thaler in 1985 gave start to a new wave of thinking known as behavioural finance. Weak form inefficiency of the stock market was discovered by them after analysing how people are systematically overreacting to unexpected and dramatic news events which were surprising and profound. The Efficient Market Hypothesis as proposed by Fama (1970) asserts that the stock prices reflect the relevant information. The asset prices follow a random walk path i.e. they are merely random numbers. The study conducted by Caginalp G. and H. Laurent (1998) by the predictive power of price patterns finds patterns and confirms that they are statistically significant even in out-ofsample testing and report. The pattern of the stock index might help in predicting some of the effects of the various events. The calendar anomalies tends to exist which goes against the efficient market hypothesis. The researchers have used Gregorian calendar to investigate the calendar anomalies. There are various countries and societies which follow their own calendar on the basis of their religion. For example, the Hebrew calendar is followed by the Jewish society, which is strictly based on luni-solar, the Christian society follows the Gregorian, which is based on solar, and similarly Hindu and Chinese follow their own. The Hindu calendar is called “Panchanga” and it is based on both movements of the sun and the moon. The festival of “Diwali” is typically occurs at the end of October and beginning of November. The special ritual called “Mahurat Trading” can be observed on major stock exchanges like NSE, BSE, NCDEX to name a few lasts for about an hour. It is performed as a symbolic ritual since many years. It marks a link with the rich past and brokers look at it on a positive note. It marks an auspicious beginning to the Hindu New Year. The investors place token orders and buy stocks for their children, which are sometimes never sold and intraday profits are booked, however small they may be. Thus, it is widely believed that trading on this day will bring wealth and prosperity throughout the year. It is interesting to observe the behaviour of trading activities during the period preceding and succeeding Mahurat Trading. The purpose of this study is to know the effect of the festival prior and post diwali on the the returns.

Econometric methodology

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I have measured stock return as the continuously compounded daily percentage change in the share price /

index (S&P CNX NIFTY) as shown below:

Visit: Rt = (lnPt – lnPt-1) x 100 …………………… (1) Team Where, Rt = return at time t



Pt, Pt-1 = closing value of the stock price index at time t, t-1.

Bag No. 9 in its portfolio. Further, the National I have used S&P CNX Nifty as it has gotPost the most liquid stocks Stock Pratibimb Exchange | Aprilis2012 largest | 40 in terms of Market capitalisation and Volume. I have used the data of the Manipal—576104

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