Innholdsfortegnelse for 2-Dec-2018 i Business Today

THE B-SCHOOL UNIVERSE in India is very big – there are well over 300 institutes offering MBA degrees or PGDBM. But there is a strict pecking order among them. The Top 10 institutes tend to attract the best and brightest students in every batch as well as the best recruiters who come with offers to their campus. They also provide the best teachers, the best environment and act as a sort of finishing school for the best students in the country. In fact, I would say that this applies to the top two dozen institutes, though even within these, the first eight or nine institutes are considered the crème-de-la-crème. These institutes and their students are largely immune to the state of the economy in the country – they get multiple…

THERE’S good news for the economy at last. Bank credit, an indicator of economic activity, rose 11.30 per cent in September this year. The outstanding gross credit at the end of the month was ₹80.25 lakh crore, according to the latest Reserve Bank of India data. While lending to the micro and small sector shrunk, lending to medium and large corporates showed smart recovery. The highest gains in the services sector were in transportation, computer software, tourism and hotels; and in the industry space, they were in automobile, electronics, cement, pharmaceutical, fertiliser and infrastructure, especially roads. In the last five years, retail lending had compensated for the low growth in corporate credit. It is now time for pick-up in corporate credit. Capacity utilisation levels are gradually rising and very soon…

INDIA HAS MOVED up 23 positions in the annual Ease of Doing Business (EDB) ranking of the World Bank to become 77th in a list of 190 countries. Remarkable, as it indicates the improvement in a host of parameters like starting a business, getting electricity, protecting minority interests, etc, in comparison with other nations. The World Bank also assigns a country specific EDB score (on a scale of 0 to 100), where India got 67.23 points, up from 60.60 the previous year. This score benchmarks economies with respect to regulatory best practice, showing the absolute distance to the best regulatory performance on each Doing Business indicator. On this front, India’s improvement on several parameters has been minimal. Registering property improved 0.46 points with a dismal score of 43.55. Retaining a…

IBM DONS THE RED HAT FOR $34 Bn The Big Blue has announced plans to acquire Red Hat, the largest vendor of open-source enterprise software, for $34 billion. It is one of the biggest deals in the U.S. tech history, underlining the pressure on IBM to adapt to a fast-changing IT sector. Red Hat's technology may help create an uber cloud, easing computer overload and ensuring faster, more efficient operations. The move will help IBM compete with the likes of Amazon and Microsoft in the cloud infrastructure business. AMAZON FORAYS INTO WHISKEY Amazon is not making the liquor, but it has bottled a Scotch whisky for the first time. Bowmore is a high-end product, and Amazon is selling a 19-year-old whisky from the brand aged in 225-litre red wine casks…

₹ 12.5 lakh Average domestic salary offered to students at government B-schools, versus ₹8.3 lakh at private B-schools, in the top 100. 6:1 Student to faculty ratio of top 100 B-schools. The student to permanent faculty ratio is estimated to be 10:1. 1.37 Average ROI of top 25 B-schools in India. GOVERNMENT RUN BUSINESS SCHOOLS LEAD IN THE TOP 25 ₹ 8,84,609 Average tuition fee of private B-schools. For government B-schools, this was ₹7,49,495, in 2017/18. 65% Of students in top 50 B-schools have engineering background INCREASING FEMALE ENROLMENT IN TOP 100 B-SCHOOLS Male to female ratio AVERAGE DOMESTIC SALARY HIGHEST IN MUMBAI AMONG METROS Average mean domestic salary (₹ lakh) 8% PERMANENT FACULTY WAS PART OF FOREIGN EXCHANGE PROGRAMMES* Colleges with foreign exchange programmes (%)…

TODAY’S WORLD of business frequently throws never-before problems at people at all levels. That is why we call it VUCA and obsess with disruption. But there seems to be a demand from HR managers for MBA schools to turn out people with narrow skill-based specifications. If MBA schools pay attention to their customers and not to their dharma (which is to develop competent men and women who can diagnose and solve business problems, design and deliver business aspirations, and build sustainable, valuable companies), they will be creating generations of business managers and future leaders who cannot survive and thrive in this new environment. The ability to diagnose and solve problems, to learn and apply the learning is what MBA schools must teach. Ravi Matthai, the first director of IIM-A, is…

LIFE AFTER THE evanescent time within the B-school campus can be tough if there is a huge student loan to clear. Sadly, this is the case with quite a few students graduating from elite business schools of India. One can argue that a premier education would not be easy on the purse. But then, not all who graduate take off equally. For example, the median salary at IIM-Ahmedabad in 2018 was ₹18 lakh (fixed yearly cash component). It means half the class got compensation packages less than this amount. The fee at the institute is currently ₹22 lakh (up by a couple of lakhs in the last couple of years). About 60 per cent of the students take loans of over ₹22 lakh. One of the students who took such…

RITESH KHANDELWAL was just 27 when he joined Siemens as a senior associate. In just two years, he was made the finance head of a major business segment of the company, and in 2016, he became the CFO, Mobility Business, a key business area for the company which contributes 10-12 per cent of the total Siemens revenues in India and is involved in some high profile projects such as state-owned metro networks and railways. A major factor that fast-tracked Khandelwal’s career was his induction in the Siemens finance excellence programme – a talent pool within the company to groom potential CFOs. Khandelwal was taken in from the University of Chicago, where he did his MBA. Palpably excited at the boost the programme has given to his career, he says, “It…

COLOUR-CHANGING LED LIGHT STRIPS are hot favourites just now – after all, they can easily create the right ambience for any occasion. You can stick one behind the TV to reduce eye strain, put one under the false ceiling for mood lighting or use it on any other surface, thanks to the adhesive layer on the back of the strip. Yeelight is part of the Xiaomi ecosystem and one of the best smart lighting solutions I have come across in recent times. The two-metre light strip, which can be stretched up to 10m if you purchase extension strips, houses 48 multicoloured LEDs and the company claims that the number of colours supported will be 16 million. It comes with a 1.5m data cable, a connector (for turning the lights on/off…

AS THE VIRUS CAN only be contained in Hepatitis B and no permanent cure is available, research is being done on eliminating it from the infected liver cell. The aim is to develop drugs that can act against the virus at the molecular level, says Dr Kulkarni. It will take a long time, though, maybe a decade or more, for such drugs to hit the market. Research is also on to develop a vaccine for Hepatitis E. Drugs are already available for Hepatitis C and the focus now is on further refinement. At the moment, for all hepatitis alphabets, the watchwords are better hygiene and sanitation.…

DISRUPT AND CONQUER: How TTK Prestige Became a Billion-Dollar Company BY T.T. JvATHAN WITH SANDHYA MENDONCA Publisher: PENGUIN RANDOM HOUSE INDIA Pages: 232 Price: ₹599 WHAT DOES one do when a 44-year-old family business is in deep trouble? In the case of T.T. Jagannathan, a gold medallist from IIT-Madras who was studying for a master’s degree in Operations Research from Cornell University way back in 1972, it was a case of being summoned to his roots by his father T.T. Narasimhan, who was looking after the business till then. The journey that followed has been well captured by Jagannathan and Sandhya Mendonca, the latter a journalist-turned-media entrepreneur, in Disrupt and Conquer, a classic turnaround story. The business was set up in 1928 by Jagannathan’s legendary grandfather T.T. Krishnamachari or TTK,…

STAY CONNECTED WITH US ON www.facebook.com/BusinessToday@BT_India PERSPECTIVES 5G Knocking on the Doors, But Are Telcos Ready? The investments in 5G are going to be more obligatory than voluntary for incumbent operators like Airtel, Vodafone Idea given their financial health businesstoday.in/5g-telcos India Gets US Waiver on Iranian Oil, But What About Chabahar Port? Will the future of Chabahar port depend on further reduction? Washington is not comfortable enough to respond as yet businesstoday.in/Iranianoil-chabahar Why Weak Banks Under RBI’s Intensive Care Will Continue to Struggle The lending environment is still challenging. The corporates are still to get into the expansion mode to borrow from banks businesstoday.in/rbi-lending Key Issues That Banks Under PCA Framework Are Dealing with Close to a dozen public sector banks are under PCA framework, monitored by RBI with lending…

TELECOM OPERATOR Airtel has recently moved to a new prepaid recharge mechanism where subscribers are required to pay a minimum amount – ₹35 – every month, failing which they will be booted out of its network. The move is likely to boost Average Revenue Per User (ARPU) of India's second-largest telco and aims to let go of low-value subsribers who are using its network largely for incoming calls without making enough monetary commitments. Strengthening of ARPUs is important for Airtel at this juncture when its top line and bottom line have been under pressure. Airtel is sort of following Reliance Jio’s path of a similar strategy for its prepaid customers. In India, prepaid subscribers account for 95.86 per cent of the market, as per TRAI data. It’s likely to result…

MONTHLY GST collections crossed ₹1 lakh crore in October this year. The last time this had happened was in April 2018. Experts had attributed that to the year-end spurt in tax collections. Unlike the last time, this time, the collections crossing ₹1 lakh crore is not seen as an exception and more as a norm even if one of the reasons for the jump could be the start of the festival season. Antievasion measures like tax collected at source, e-way bill are finally coming into play to give a fillip up to the GST collections. There is a feeling now that the revenue department will go the whole hog to ensure that collections do not fall below ₹1 lakh crore now and, therefore, businesses should ensure that their GST audits…

TATA SONS, the holding company of Tata Group, is reportedly gearing up to pay a major chunk of the ₹10,000 crore dues of Tata Teleservices (TTSL) to the government. The holding company had earlier written off its investment of ₹28,652 crore in TTSL and compensated about ₹8,000 crore to Japanese partner DoCoMo for the losses it incurred. The telecom misadventure has cost Tata Sons heavily and profit declined to ₹4,379 crore in the last fiscal from ₹18,432 crore before that. Although Tata Sons is the parent of more than 100 group companies, 90 per cent of its dividend income comes from TCS – a sign of over-dependence. Tata Sons, which made a windfall gain of ₹10,000 crore in the TCS buyback in FY18, is also looking to sell more shares…

“ANYONE WHO wins on digital will win the elections as well.” This statement by digital marketing expert Ahmed Aftab Naqvi, CEO and Cofounder of Gozoop, might have seemed an aberration a few years ago, but now it is the new normal. These days, elections are won and lost on social media – the 2014 General Elections in India and the 2016 U.S. Presidential Elections have already proved it. There is a marked difference, though. Five years ago, social media was a complementary platform for political campaigns; now it has taken centre stage. “In 2014, political campaigning on social media gained some acceptance, but after the huge win of PM Narendra Modi, people have realised the importance of campaigning on social media,” says Rahul Jain, Founder of Social Rajneeti, a digital…

THIS IS AN AGE OF specialists, impatience and one of disappearing information arbitrage. A consultant’s job is getting more complex, and more lucrative. This has a direct bearing on the kind of talent being hired. As a result, leading consultancies have expanded their catchment area for hiring to go beyond just business schools. “Clients are getting more sophisticated and want to see more expertise and implementation capabilities,” says Gautam Kumra, Senior Partner and Managing Director, McKinsey India. That’s one reason why, he says, “over the past two to three years, we have been hiring (specialists like) data scientists and data statisticians aggressively.” When clients ask for specific advice or expertise, consultancies have to be in a position to fulfil that demand. “One of our pharma clients wanted to engage with…

AS IN PREVIOUS YEARS, we partnered with leading market research firm Marketing & Development Research Associates (MDRA) to conduct a ranking of India’s business schools. A comprehensive list of B-schools offering full time management courses (PGDM/MBA), established at least five years ago with minimum three passed-out batches, was updated. The objective questionnaire was finetuned to obtain the latest and most relevant information from the institutes on each parameter or sub-parameter and was put on websites of MDRA and Business Today. More than 2,300 B-schools that met the qualification criteria were informed and requested to participate in the objective survey, through emails, telephonic calls and advertisements in the magazine, within the mentioned deadline. In all, 305 institutes across the country submitted their objective data within the timeline and were considered for…

ARTIFICIAL INTELLIGENCE has been feeling creative lately and has entered the space of fine arts. And masters like Van Gogh would be none too happy to find out that all it takes to paint a self-portrait these days is a bunch of zeros and ones, or to put it more sophisticatedly, a programmers’ code. Tech behemoth IBM is the one who put the idea into an AI system. Although the outcome is not likely to satisfy every art lover, the project is intriguing because of the way the process has been broken down. The first step involved scanning hundreds of articles about AI so that the system could have a borrowed sort of self-awareness. It also combed through thousands of paintings, made by humans, of course. Then it chose several…

MEDIA STREAMING DEVICES are smart little things which you can plug into your smart/traditional television and then connect to the Internet to play content from thousands of apps such as Netflix and Amazon Prime Video. For years, Google’s Chromecast has been a popular media streamer, but there has been a recent update. The latest version is a small, round dongle with an HDMI connector and gets power via a microUSB port that connects either to a USB slot on the TV or the included power adapter. Next to the microUSB port, you will find a power button (also used for factory resetting) and a light indicator. But unlike the Amazon Fire TV Stick, Chromecast does not have a physical remote and everything has to be done via the Google Home…

THE CENTRE seems to have toned down its demand from the RBI to hand over a part of its excess capital. This is among the half-a-dozen issues over which the Centre and the RBI are at loggerheads. While the Centre has denied seeking any surplus capital, the Chief Economic Affairs Secretary, Subhash Garg, has said the government is talking to the RBI for fixing an appropriate capital framework for it. This is possibly a middle ground for the Centre and the RBI. Once this is done, it will become easier for the Centre to tap the RBI’s capital. Experts say there is little merit in the government’s argument of ‘surplus capital’ and it shouldn’t rob the RBI of its savings. The RBI has been handing over its entire surplus of…

ABOUT ₹2.3 LAKH CRORE worth of commercial papers (CPs) and non-convertible debentures (NCDs) issued by liquidity-hit non-banking financial companies (NBFCs) are to mature by December. Is there a systemic risk? Or do the RBI and the government have things under control? The government wants a dedicated window to infuse liquidity (similar to 2009) but the central bank believes there are enough means available at its disposal. It recently allowed banks to give partial credit support to NBFC bonds. After concluding ₹36,000 crore of open market operations in October, the RBI will inject an additional ₹40,000 crore in November. The NHB also raised the refinancing limit to ₹30,000 crore, while banks such as SBI raised portfolio buyout target by 2-3 times. Experts say any default is unlikely as most NBFCs are…

ON SCREEN WHAT: BIG PICTURE SUMMIT WHEN: 6-7 Dec, New Delhi WHAT TO LOOK FOR: This is CII’s annual flagship event for the media and entertainment sector. Media visionaries and thought leaders from across the world will share and engage with the Indian M&E sector on issues such as the innovative changes that the industry would require to scale up; how to make the regulatory and policy framework conducive? BEING HEALTHY WHAT: GREEN CONCLAVE WHEN: 6 Dec, Pune WHAT TO LOOK FOR: The basic objective of Green Conclave is to develop knowledge and tools that accelerate the transition towards a sustainable industrial system. It aims to highlight importance of green initiatives in protecting the earth and the environment. The Conclave will bring together leaders who are inculcating and propagating green…

Video-sharing site Vimeo has recently announced a new feature that enables its users to publish videos directly on the professional networking platform LinkedIn. Earlier, the company’s Publish to Social feature supported auto-uploading of videos on multiple sites, including Facebook, Twitter and YouTube. Vimeo is the first video platform to offer its services to LinkedIn, once again highlighting its focus to evolve into a tools and services provider to businesses and professional networking sites.…

Like many other leading consulting firms, McKinsey is a big recruiter on B-school campuses. Typically, it takes about eight years or so for the people it hires to become a ‘partner’. But that is too short a time to develop expertise, and clients, too, increasingly need implementation capabilities. So, McKinsey has been hiring domain experts laterally and has created different pathways to becoming a ‘partner’. These are: GENERALIST PARTNER: Catchment area would typically be leading B-schools EXPERT PARTNER: Area experts in domains such as risk or cyber security. Would be hired from industry, say, a chief risk officer in a bank MASTER EXPERT: Globally best expert; would be a handful RTS (RECOVERY AND TRANSFORMATION SERVICES) PARTNER: Could be lateral hires from industry; ‘chief’-level executives (CXOs) or others who have been…

AND THIS IS MY STORY TOO. A student in a dorm room, connecting one community at a time, and keeping at it until one day we can connect the whole world, said Facebook Co-founder Mark Zuckerberg who dropped out of Harvard. Dell founder and CEO, Michael Dell, managed to convince his parents and dropped out of the University of Texas, Austin, to pursue his business ideas. Steve Jobs and Bill Gates also dropped out to start their iconic companies. All these stories have some common factors – a powerful vision, strong empathy to bring a change in some aspects of human life and the spirit of innovation that leads to solutions with huge impact. The B-school agenda must mull over this – what is more important in life, getting into…

INDIA IS A DIVERSE COUNTRY, and this is true for MBA education as well. With about 5,000 MBA/PGDM programmes across the country, the gap in quality of education between the top institutes and those at the bottom is increasing. Top institutes (such as the old IIMs and ISB) have consistently done well on reputed global and Indian rankings, and the competition to get that coveted seat in such institutes is increasing. But the institutes at the bottom are not even able to fill up their seats (some could fill up less than 10 per cent of the seats approved by the regulator). Many of the institutes have either shut down or applied for closure. As per the All India Council for Technical Education (AICTE), more than 50 per cent of…

Q: Why is it so hard to sustain an initiative’s improvements? A: It’s an issue of energy. And when a new initiative comes along, people ask, “What do we do with the old one?” Much of our workforce models the behaviour of senior leaders, and when those leaders shift their energy to something else, it’s hard to sustain things. What differentiates changes that stick? Sustainability starts at the beginning, in how we frame a project and what it means to the organisation and our purpose. It’s the difference between behaving like a buyer and behaving like an investor. If we’re asking doctors to get on board something that’s under way, it’s already too late. We need to get them invested in the project, and thinking like owners, well before it…

Your Happiness Was Hacked: Why Tech Is Winning the Battle to Control Your Brain – and How to Fight Back By Vivek Wadhwa and Alex Salkever Publisher: Berrett-Koehler Publishers Pages: 192 Price: ₹1,891 PUBLISHED IN JUNE THIS YEAR, Your Happiness Was Hacked is a timely account of digital tech proliferation and its all-pervasive impact. The likes of Google, Facebook, Twitter, WhatsApp, Snapchat, Instagram and Netflix govern our lives in a far more significant way than we recognise. The authors delve deep as they analyse how technology is affecting our choices and leading to addiction, with consequences such as isolation and invasion of privacy. Happiness is their second book, the first being The Driver in the Driverless Car: How Our Technology Choices will Create the Future, published in 2016. In their first…

SUNIL WADHWANI CO-FOUNDER, MASTECH (NOW IGATE); FOUNDER DONOR, WISH FOUNDATION Under his leadership, Wadhwani Initiative for Sustainable Healthcare combines IT with healthcare services to manage 300 remote health centres in India. Q. The biggest challenge you faced in your career A. I started an IT firm called Mastech (now iGate) in the 1980s. The first two-three years had been so difficult that we were about to shut it down three or four times. I was almost certain that we would not survive. But thanks to the hard work everyone had put in (we had a tiny team then) and the good luck we had, we were able to pull through and started growing. (iGATE went public in the US and Capgemini acquired it for $4 billion.) Q. Your best teacher…