Pratibimb july 2013

PRATIBIMB

FINANCE | GENERAL MANAGEMENT | HUMAN RESOURCE | MARKETING | HEALTHCARE | OPERATIONS | SYSTEMS

The Reflection of Management

Volume II, Issue XXI July 2013 A Monthly e-Magazine

A Students’ Initiative

Straight from the corporate

Interview with the experts

Mr. Chandrakumar Natarajan

Vice President and Head , Human Resources , GVR Infra

Mr. Purav Sanghvi

Head ,Human Resources ,

Reliance Entertainment (Digital)

Pratibimb | July 2013 | 2

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.

“To excel in post-graduate management education, research and practice”.

Means:

1. By nurturing and developing global wealth creators and leaders.

2. By continually benchmarking ourselves against best in class institutions.

3. By fostering continuous learning and reflection, achievement orientation, creative

interdependence and respect for diversity.

Value Bounds:

1. Holistic concern for ethics, environment and society.

T. A. Pai Management Institute

Manipal, Karnataka

About TAPMI

Our Mission


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 well known 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 in the B-Schools 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 TAPMI’S MONTHLY e-MAGAZINE VOLUME 2, ISSUE XXI JULY, 2013


In today’s increasingly diverse business world, it is critical for mangers to gain knowledge from varied business

backgrounds. In such a situation, the role of a b-school magazine is important as it provides a platform for the research

work done by the students. Pratibimb, the monthly e-magazine of TAPMI is a collection of knowledge from various

business scenarios. The articles and interviews focus on current developments in the management arena. I am sure

Pratibimb will stimulate and nourish enthusiasm among students to study and research in detail about the current business

trends.

I look forward to this exciting journey as we develop Pratibimb into its fullest potential. Dr R C Natarajan Director TAPMI

Director’s

Message


Editor’s corner

Arun Stephen

Abhineet Rastogi

Bhavnita Nareshkumar

Devi Kailas

Kannan Venkat

Shubha Prabhu

Aditya Bhat

Lloyd George

Prof. Chowdari Prasad Dean (PR) & Chairman-Admissions

Prof. Aparna Bhat

Editor in Chief

Marketing & Advertising

Creative & Cover Design

Communications

Operations

Publishing

Faculty Advisors

Dear Readers, We thank all the participants and readers for their contributions and feedback. In this issue of Pratibimb, Mr. Rajesh Prasad of TAPMI discusses the non hierarchical model of leadership where collaboration is the key factor for success. Further, Mr. Ajay Kumar of TAPMI talks about the book “Great Again” in his book review, revealing the importance of an entrepreneurial spirit for the development of a nation. Pratibimb had an opportunity to interact with a few corporate members as well. It is our pleasure to publish industry insights from experienced people which can give a new direction to the thought process of MBA students. In one such interview, Mr. Chandrakumar Natrajan, from GVR Infra, shared his valuable insights on Infrastructure industry and the current trends in HR practices. Another interview with Mr. Purav Sanghvi from Reliance Digital gives insights on the importance of HR as a domain and Employee Motivation. In the article, “The Chronicle Indications of United States” Mr. Prakarsh Jain, from SP Jain College, explains the current issues prevailing in the US economy. He also talks about how in a developing country like India, the financial inclusion of the large sector of rural population is the key to the prosperity. An article by Mr. Amit Singh and Ms. Spoorti Unki of NMIMS talks about micro financing and how India can benefit out of this. Going further, we have Mr. Prafull Srivastava and Mr. Anshul Khandelwal explain the way by which marketers are making best use of the wonderful medium called social media, which is becoming a strong force with which to control the business of today. Also, in his article “Going Green Way”, Mr. Dave Aditya Bharatkumar talks about the green strategies adopted by various organizations, thus underlining the importance of sustainability in current business scenarios. As always, stay safe, celebrate life and keep reading Pratibimb. Stay updated and like our page to hear more from us at :- http://www.facebook.com/pratibimb.reflecting.management

We would like to thank all our faculty members who have provided their

valuable feedback in order to help us maintain the standards we have strived

to achieve.

Enjoy Reading!

Arun Stephen


Contents Developing Non-Heirarchical Leadership: From Command to Collaborate 7 by Rajesh Prasad, TAPMI

Interview—Mr. Chandrakumar Natarajan 9

Interview— Mr. Purav Sanghvi 11

Book Review : Great Again 13 by Ajay Kumar, TAPMI

The Chronicle Indications of United States 15 by Prakarsh Jain, S P Jain, Singapore

Microfinance: An Emerging Financial Market in India 19 by Amit Singh, Spoorti Unki , NMIMS

Social Media: The New Battleground for Marketing Wars 23 by Prafull Srivastava,Anshul Khandelwal ,IIFT

Going Green Way 26 by Dave Aditya Bharatkumar, NMIMS


A majority of the companies have an intensely rigid hierarchy of leadership into their

system. This ushers managers the room to sustain and companies to leverage their

strengths. Nevertheless for companies that aim to embark on new strategies, they need

sustainable and competent leadership. This is possible only in highly dynamic

environment, where hierarchical leadership structures are surpassed by innovation. Such

an environment provides opportunities to employees regardless of their rank and helps

propel the company into a commanding position through collaborative and participatory

leadership.

In the recent times there is an evident shift in many businesses and not-for-profit

organizations—transition from the more traditional and hierarchical model of leadership

towards collaborative leadership for ameliorating relationships with others. This type of

leadership seeks to involve others in decision making, is strongly ethical, and assures the

career growth of employees along with better quality of work-life.

The business leadership has now been dominated by managers who ruled their

enterprises from the top down. In earlier times, influence of two World Wars was very

evident, as the organizational hierarchies were designed similar to that in military, with

an extensive hierarchy to establish control through rules and processes. The desire of

power, status and money, is very well brought out in 1956’s classic- ‘The Organization

Man’ of William H. Whyte and in 1955, ‘The Man in the Gray Flannel Suit’ by Sloan

Wilson.

In the late twentieth century the short term nature of stock market, caused business

leaders to focus on myopic gains which side-lined the long-term growth. This not only

manifested itself in jitters like the ethical debacles exposed by Enron and WorldCom but

also showed up in the Wall Street meltdown. Due to this, people started doubting the

calibre of corporate leaders in structuring a sustainable institution since they were self-

centric and myopic in intent.

Ever wondered what could have probably gone wrong in whatever transpired?

Traditional hierarchical system’s failure could have been an answer in the right direction.

Today most of the work force simply won’t respond to the command type of leadership.

The new generation work force is not willing to wait in queue for getting promoted and

seek more and more opportunities. They are focussed more on job satisfaction apart

from the monetary benefits that they are entitled to. In many companies employees are

motivated by the mission and values of the organization. Dynamic leaders are more

focused on customers. Hierarchical leaders aimed only nearby goals and are oblivious of

the larger picture. One leader who walked the talk is Mr Paul Polman, CEO- Unilever. He

expressed his views as- "I don't work for any shareholder. I only work for my customers."

Off late, the leaders are more focussed on the alignment between employees and the

organization mission, vision and values. This helps empower the leaders and makes them

perform through collaboration within the organization.

Developing Non-Hierarchical Leadership:

From Command to Collaborate

Rajesh Prasad, TAPMI

http://www.amazon.com/exec/obidos/ASIN/0812218191/

http://www.amazon.com/exec/obidos/ASIN/0812218191/

http://en.wikipedia.org/wiki/The_Man_in_the_Gray_Flannel_Suit


The following characteristics of these collaborative leaders

contribute to their meaningful practice of non-hierarchical

leadership:

Listening: They need to possess a strong commitment to

listening others intently. They need to listen receptively to

what is being explicit and implicit. Listening to one’s own

inner voice is equally important. Reflection in the interim is

conducive for the growth and advancement.

Aligning: Proper alignment of employees along company's

mission is of utmost importance. Multi-national organiza-

tions where employees are more attached to local cultures

instead of the company’s work culture, alignment becomes

even more complex.

Listening: Johnson & Johnson is a stunning example where

organization has aligned their employees perfectly and

thereby directed them for performing in alignment with

goals of the company. Traditional hierarchical leadership has

been proved to be out of place and it has never been able to

tackle the work place deviance. Diligent alignment of em-

ployees makes them responsible for the larger good of the

organization which is something greater than their individual

gains.

Empowering: The manner in which hierarchical leadership

exercises its power is through command and taking total

control of their subordinates. On the contrary, the non-

hierarchical leadership traits enable the leaders to take con-

trol of the position by empowering the various leaders at

different designations. The leaders at every level thus set

excellent work standards for others to emulate in a condu-

cive and collaborative atmosphere. The satisfaction out of

this kind of quality work surpasses the feelings of individual-

istic and myopic gains.

Serving: New generation leadership believe that employees

possess an intrinsic value apart from their tangible work

performance. So, they are religiously committed for the

growth of every single employee within the company. The

leader should sense the innate responsibility of nurturing

the professional and personal growth of the employees, off

course within their gamut of power. Customer satisfaction

and purposeful employees becomes the key for sustainable

competitive advantage.

Collaborative: The leaders need to be persuasive and con-

vincing others for taking a course of action, rather than using

their positional authority for coercion. This aspect offers a

very lucid distinction between the traditional authoritarian

leadership model and the collaborative leadership model.

The importance of persuasion instead of coercion has been

corroborated by the Religious Society of Friends, Quakers,

Britain (UK). Collaboration within the organization, with the

customers and consumers and with the suppliers is a prereq-

uisite for sustained solutions and services.

Generational Intelligence: The caliber to reflect and act,

with an understanding of one’s own and other’s life-course,

family and social history, placed within its social and cultural

context. It needs the leader to place himself in the position

of a person of a different age or generation while working

towards sustainable solutions.

Summarizing the process - From Command to Collaborate:

The changing nature of the complexity of the business prob-

lems have brought out the inability of the organizations and

individuals in solving it for lasting results. This has led to the

need for a more collaborative and coherent yet diverse and

innovative leadership within the organization.

The following initiatives will help the transition:

1. Team Work & Team building

2. Strong Reverse feedback mechanism

3. Strong Legal Compliance & Grievance handling mecha-

nism

4. Strong basis for Performance Management

5. Rewards & Recognition (Given to the performing associ-

ates from time to time)

6. Brain Storming sessions with the team for decisions to

be taken

7. Strong upward & downward communication

(Transparent processes)

8. Developing a positive & employee friendly work culture

9. Flexibility in work timings & work operations

10. Social networking & socializing opportunities to be given

to the employees.

References:

Spears Larry C. (2010). Character and Servant Leadership:

Ten Characteristics of Effective, Caring Leaders. The Journal

of Virtues & Leadership, Vol. 1 Iss. 1, 25-30.


India is developing rapidly and there are lots of opportuni-

ties in infrastructure industry. What are the existing oppor-

tunities you see in this particular scenario?

Infrastructure industry will be developing at a faster rate

provided the policies of the Government are pro-industry.

The back bone of any country’s development is its infra-

structure and it needs to be created at a faster pace. If you

look at our country we have approximately Rs one lakh

crore worth of roads to be laid across the country and one

can see a huge potential for the growth of infrastructure

companies. The key question is how friendly is the Govern-

ment polices and how fast the funding can be done by

Banks.

What are the qualities required for a manager to do well in

the Infrastructure industry?

A good manager requires excellent business acumen, com-

munication skills, decision making skills and Leadership

skills. A good Manager need to be a good leader who has

vision with a clear road map for achievement. He has to

resolve complicated problems and should be able to mould

himself to his organizational needs and be prepared to meet

any future challenges. For Eg. we induct management train-

ees into the system and prepare them as future business

leaders through a comprehensive training program for

about an year.

You have experience in different companies and in differ-

ent industries. What are the differences in HR practices you

have observed across these industries?

In general, I would say the HR practices across all the indus-

tries are quite similar. Fundamentally the HR department

deals with people. The human nature more or less remains

same except for the skills and competencies required for

each job/industry is different. Certain compliances level re-

quired may vary from industry to industry.

For example, in the aviation industry, the skills and compe-

tencies required for a pilot is quite high with precision. He

has to have airline pilot license, should have flown a particu-

lar type of aircraft and should have minimum hours of flying

experience and so on and so forth. The compliance require-

ment is also very high in these industries. In the case of en-

gineers, an engineer in aviation requires a special license to

carry out his work. But a civil engineer in construction indus-

try does not require any license. So the kind of job /kind of

industry determines the skill and competency level.

In a nutshell I can say the HR remains the same, the respon-

sibilities of an HR Manager remains the same across the

industries. HR is fundamentally involved in talent acquisi-

tion, talent engagement, talent development and talent

retention. So in any industry we will be doing the same.

In many industries attrition of the talent is the main con-

cern for the HR managers. How do you tackle such prob-

lems?

It all depends on the market conditions, the aspiration levels

of the individuals and HR practices. If the market conditions

are not very good for the infrastructure industry, then the

tendency for shifting to other companies is also less

amongst employees. People will try stick on to their organi-

zations. Contrarily, in IT industry the competition is very

high and companies are vying each other to pick up the best

talent from competitors. So naturally the attrition levels

INTERVIEW

Mr. Chandrakumar Natarajan

Vice President and Head –Human Resources, GVR Infra

TAPMI had an opportunity to interact with Mr. Chandrakumar Natarajan the Vice President and Head of Human Resources, GVR Infra. In an exclusive interview with team Pratibimb Mr. Natarajan shares valuable insights on infrastructure industry and current trends in HR practices


goes up. This trend depends on the industry. Also depends

on various HR practices such as the transparency in manag-

ing performance management systems, Learning and Devel-

opment opportunities etc.

What about the CSR initiatives of GVR group and how im-

portant it is in the day today activities of the company?

We do have our share on CSR initiatives. Normally, before

we execute the projects, we adopt villages in and around

that project area and take care of the certain infrastructure

development around that place. We engage teachers for

the children of our construction workers. We have helped in

reconstruction of some regions of Andhra Pradesh which

were destroyed by cyclone.

How did your experience in the Indian Air Force help you

in grooming your managerial career?

Military force is a disciplined force which imbibes one with

discipline in his life. Secondly, It helped me in grooming my

managerial capabilities. Thirdly, in defence we forget caste,

creed, colour etc., and it is very secular. The kind of bonding

that happens in military is phenomenal and that never hap-

pens in a civilian’s life. The qualities we inherit like team

spirit and sacrifice also help in achieving desired business

results.

What are the opportunities for MBA graduates in Infra-

structure Industry?

Infrastructure industry needs MBA graduates mainly for

finance and HR functions. Not much happens in marketing

function since most of the business is with Government

projects. We don’t need a marketing guy to market our pro-

jects, but we need a seasoned guy who can negotiate with

government officials and who can overcome government’s

red tape.

How important is that including some industry specific

subjects in MBA curriculum? For example including a

course for core industry like infrastructure?

I don’t think it is necessary to have any specific curriculum

for infra industry. General specialisations such as marketing,

finance, HR, operations etc would be more than sufficient.

Once, the fresh graduates join the company, on the job

training (OJT) is good enough to mould people in desired

way. In GVR the training period for management trainees is

usually 1 year. Based on these training/specialisation train-

ees are assigned to different projects. The processes fol-

lowed in various industries are more or less the same. The

people and their competencies are the most important

things.

The interview was taken by Mr. Arun Stephen and Ms.

Shubha Prabhu for Pratibimb


What is your opinion about cultural differences in Human

Resources Management in different organizations?

(Wipro/RED)

Wipro and Reliance Entertainment Digital are predominantly

same in terms of work culture where type and demographic

of people is involved. Culture is young and transparent. If

you can kick butts you are hired. People love to work here

because it’s a very upbeat and aggressive place to work.

Only difference between the two companies is the nature of

business due to which there is process and structure differ-

ence.

Sometimes employees see that Human resource depart-

ment is not working in their favour. Have you encountered

such situations? How can we tackle that type of situa-

tions?

Every HR head worth his bread would have encountered this

statement. In all honesty you just have to try and make the

work place a better place to be. Sometimes what may suit

the employee may not be what the company would want

simply as it will not give the company the desired result.

Focus on work; be honest about your job. Listen to employ-

ees as what you say matters and give closures to their issues

in or against their requests. Sooner or later they will come

around. Don’t try and please people, do what is right and

80% people will respect and agree to what you bring to the

table. It also builds a lot of trust in your work methods.

What are your suggestions for b-school students about

work culture?

Culture is all about what you bring to work. You define the

culture. Ask and change the culture which best suits the

organization. If it makes employees and thus better work

place, all are happy.

How do you ensure increased participation and innovation

among employees?

At Reliance Entertainment Digital we have an open work

culture where everyone is heard and not judged. Teams thus

feel responsible for innovation and as there is no downside

to it. They innovate better. Besides this, we do a lot of activi-

ties like Hackathon and open houses. Plus ideation sessions

are the ones in which even HR and finance sit through. We

believe that an idea is no teams copyright and best have

come from teams who are not in the core of the business.

The work culture at Reliance Entertainment Digital is very

different from other companies? (Open door policy, flexi-

ble working hours etc.) What was the thought behind the

initiatives taken?

We are a very young company. Average age of employees

here is 23 years. We wanted to create a work place where

you love to work. Today my team comes here to hang out

and have fun and work just happens. Colleagues here go out

of the way to help others. We have created a family and we

love it. Approachable companies innovate better and deliver

better. Our project delivery has improved from the times we

have made things flexible; it works for us business wise as

well. The sense of responsibility is higher when you know

you have to deliver on your own and nobody is watching.

Have you been able to clearly outline the changes in the

organization post the initiative?

INTERVIEW

Mr. Purav Sanghvi

HR Head – Reliance Entertainment - Digital

Pratibimb had an opportunity to interact with Mr. Purav Sanghvi the Head of Human resources Reliance Entertainment—Digital. In an ex-clusive interview with team Pratibimb Mr. Purav shares valuable in-sights on HR and entertainment industry


organization post the initiative?

Yes the company profit and EBITA directly say the story. We

are way better and leaner due to these initiatives. They are

direct results apart from the bonhomie shared. No company

will do things if it doesn’t make business sense. In our field

this does. I have lead change management and OD for 3

companies and over 7 years. This has been a well crafted

plan and the leadership supported it.

How do you keep your employees motivated as media &

entertainment is a highly volatile industry?

We create an environment in which they are self motivated.

It has to come from within. Also we encourage freedom for

employees to do their own things in office; nobody monitors

how many hours you spend on youtube and facebook. The

only thing we monitor is that you can’t be spending less

than 2 hours a week on games. We are a gaming company

after all.

What are your views about the notion that the HR depart-

ment of an organization does not contribute in terms of

tangibles (revenues) and hence is more of a secondary

functional unit?

It’s a debatable topic always, the question above is predom-

inantly in organization where it’s still a personnel depart-

ment and seen as paper pushers. HR understands organiza-

tion dynamics and they are involved in business decisions at

Reliance Entertainment Digital. HR has to be a business

partner and help in growth of the company. That can hap-

pen only when they know how to do the business, at Reli-

ance Entertainment Digital we do and we sit on board

meetings so the company doesn’t see us in that light. This

amount of confident needs to be built by the HR heads to

the point that business starts respecting HR as a critical

function. And in terms of tangible benefits HR can manages

the cost of the organization. That as well as the single larg-

est one which is manpower cost. There are tangible num-

bers that HR projects. Do remember that even HR needs to

show its ROI. In companies where HR does this you won’t

have the notion as above.

What is the HR's contribution during critical decision mak-

ing phases in a company in terms of strategy/policy formu-

lation?

To route it via an example with recession coming in, lot of

things have changed. It became very critical for all business-

es to control cost and build confidence in teams. HR single

handedly was made responsible to restructure the organiza-

tion. Apart from that at Reliance Entertainment Digital no

decision even of business is taken without the HR head

agreeing to the terms. HR happens to be a critical function

and though it does not directly relate to business its action

can make or break the company’s future. Imagine a case of

a wrong hire or dissatisfied employee or no sense of belong-

ing or a doomed culture. The examples itself will give you

the answer you need.

This interview was taken by Mr. Abhineet Kumar Rastogi

for Pratibimb


The author Henry R. Nothhaft is a successful entrepreneur and an advocate of smart

innovation policies in Washington, D.C. while David Kline is a Pulitzer Prize nominated

journalist who has authored several books on innovation.

This book review starts with under-

standing the authors perspective

about what was driving the unprece-

dented growth story of US and what

went wrong. The author has divided

the book into 5 sections outlining

the reasons of the failure of the

growth engine in US and what

should be done to revive it again.

The sections are as follows:

Regulation

The Patent Office

Manufacturing

Immigration

Government Funded Research

The author starts by quoting several

regulations which he feels have

been strangulating the growth in US

economy. He states that some of them being the Tax regulation have been providing a

lot of friction to the growth of several entrepreneurial ventures some of them being the

Solar cell industry that has been facing steeply high incidences of tax slabs. These regu-

lations, he alleges, have been the reason for the decline in the level of innovation in US.

Next he indicates that the functioning of the US Patent Office has been far from satis-

factory since that have been dragging their feet for quite some time. Since the Patent

Office is slow in granting the patents to the new ideas that pass through them, it be-

comes extremely difficult for new start-ups to generate funding and the lack of that

results in a lot of ideas dying. The author alleges that the dysfunction at the US Patent

Office is imperilling not only the entrepreneurial inventors but also the economic recov-

ery as a whole thus challenging the global innovation leadership of US.

Further still the author mentions the outsourcing of manufacturing from US soil to de-

veloping economies like China and India. He states that with the outsourcing of manu-

facturing, not just jobs are lost but also several cities and societies are destroyed owing

to the migration of people in search of jobs. Why manufacturing within US matters is

Book Review : Great Again– Revitalizing

America’s Entrepreneurial Leadership

Ajay Kumar, TAPMI


because it has a multiplier effect, spawning job creation,

investment and ancillary business. The author contends that

outsourcing is resulting in hampering of this multiplier

effect. The author though does not talk about the benefits

that outsourcing of manufacturing in the industry. He is also

silent on about additional jobs that have been created in the

US owing to the outsourcing operations which are not just

limited to manufacturing or services but span a host of other

industries.

Immigration, according to the author, over decades has re-

sulted in positive brain gain for the US which not propelled

the US economy to the leadership position but helped to

cement that position for decades to come. But he contends

that over the years, US immigration laws have become

stricter to the point of strangulating the US economy but

discouraging people to come to the country. The author

states that the immigrants have been a big source of innova-

tion and thus not only creating jobs directly but also indi-

rectly. But the author also cautions that not all immigrants

may be innovators and thus differentiation needs to be

made. What the author is silent on is why this selective

treatment of immigrants? If other countries also adopt the

same process for US citizens when it comes to offering job

opportunities, then will his reaction be the same?

Lastly the author indicates that amount of funds available

from the Government to fund various research programs

have been decreasing sharply to the point where it has

strangulated a lot of god ideas owing to the lack of funds. He

quotes examples like the birth of internet (ARPANET) owing

to the government funded research by Department of De-

fence. The author stresses the need of Government funded

research to the point where he mentions that it could be a

do or die situation in years to come.

In all the author looks at the points where he draws parallel

between the state of US economy as it was in its hey days

and what is it now. The author though is silent about the

fact that the world economy in itself is changing and the

ways of doing business has now adopted a new paradigm.

He still contends that manufacturing is better over services

since the former creates “real” jobs while he is silent of the

fact that the distinction between manufacturing and ser-

vices have been becoming less and less and may soon fade

away. He leaves the question unanswered about how to

adapt to change.


Year 2007, when the underlying stability of global economy and United States of Ameri-

ca in particular was experiencing intense scrutiny by various economic analysts. The

mortgage-driven pleasance that was depicted in early 2000’s just seemed too worthy to

be true. Many of us, the educated and the non-readers, directed that such a system,

which was based on questionable debt instruments, livened up by the central banking

voodoo of cash creation and arbitrary fractional reserve lending, could not possibly sur-

vive for very long period of time. The collapse was carved out and it was coming soon,

but nonetheless most of our fellowship, were either acting too stupid to recognize the

problem or too frightened to accept the reality, which was just over the horizon.

Federal Reserve Cheated America:

The story started in the 1980’s, the decade of Globalization in States and this bought

with it utter disguised destruction. The Industrial Centre, the soul of American midsec-

tion, which created enormous wealth and would have bought platinum centuries for

the country had been stripped and shipped overseas. It was then that the books of US

economy had actually changed. From that point forward and until now, the population

has been fully dependent on the brotherly love of central bank money creation and

international bank lending standards. The collapse that should have occurred in the

1980’s was just delayed and which made it more volatile, as the Fed had to artificially

lower interest rates and allow trillions of dollars in ‘Fraught with uncertainty’ loans to

be generated, average citizens were suckered in the royal manner. A perfect example of

using the greed of an individual against him, as they collateralized homes they could not

afford to buy, and the rest is known…

The Frozen Markets:

Presently, credit markets remain frozen. Lending is nowhere near to the levels they

were in 2006. The housing market seems to be gaining life after being dead; but do we

know the buyers, banks, and not the regular people are making the purchases, for cen-

times on the dollar. These belly-up properties are reissued for renting rather than for

sale, obvious reasons. Maybe it happens that people would get the keys of the house,

they used to previously own. Thousands of high-paying full-time jobs have been lost

and now been replaced with lower-paying part-time wages, in simple terms slavery po-

sitions, but government claims unemployment is slashing down, the question is, in what

sense. The shock is that image of American prosperity still carries on, but anyone with

rational sense would certainly question, how long will this give life, before the truth

clicks.

I am sure, the question arises, why are we re-examining all of this information, is it not

widely known. It is therefore time for us to apply some foresight given the known of the

past.

The Chronicle Indications for United States

Prakarsh Jain, S P Jain Singapore


Understanding the Behaviour:

What was that crept up on so many people in 2008?

Weren’t there analyst out there “prophesying the chorus”?

Weren’t there signals, signalling?

Weren’t there plenty of conclusions being made?

Yet, the world was left astonished. The verity is, humans

have a smutty habit of ignoring the facts, which are evident

in the present in high hopes of using spiritlessness as a magi-

cal elixir for future successfulness. They tend to believe that

catastrophe is a mind-set and that it is a bogeyman that can

be defeated through blinded optimism. The refusal to ac-

cept that disaster is in real inevitable, that pays no heed to

our unenlightened attitudes and that’s what caught the

American people to be arrested off guard in 2008, just as

they are setting themselves up to be again.

The Fiat Injection:

The reality again seems to be quite clear; the Fed has

propped up equities and bonds using currency created out

of the air and to the extent that both the markets have be-

come totally dependent and disturbingly hooked to the fiat

injections. The distribution of this kind threatens the domi-

nance of the dollar as world reserve and invariably leads to

the collapse of currency, which shall lead to, hyper-

stagflation. This operation is more likely to reach its climax

in the near future, given the rate at which quantitative eas-

ing has been undertaken within the system to date and the

quickened rate at which our primary lenders, China, are

dumping the currency in bilateral trade. The endgame is

apparent, but the fear still exists within the country and

around the globe, will the shock once again be renewed by a

crash.

Argument still exists: “Things might be dicey, but apparently

it won’t be as bad as all the doom-mongers claim”

However, let us make it clear; naysayers before umpteen

shocks made similar statements, so why are we seeing the

skeptics wrong again.

Lifeblood of the Economy:

Let me put this in the simplest form possible: Stimulus,

that’s what we call the lifeblood of the American economy.

There is nothing other than this sustaining the nation. Stim-

ulus has seen various forms, form of bailouts and Quantita-

tive Easing are the ones keeping the stock market and bonds

afloat. This only takes us to a conclusion that the continued

existence of equities, retained existence of level-headed

treasuries, the general economy, and an officiating govern-

ment, is pendent on the Fed continuing to print.

In recent times, Ben hinted at a possible intention to reduce

stimulus measures and remove them completely by the mid

of next year, which would efficaciously shut down the sup-

port system machine and let the patient drown in his own

fluids.

Mongers and common investors are not very bright, but the

market understands it well, that no stimulus would mean no

stock market and no bond market. This is evident by the

response indexes have got, which have become mercurial.

Pitiably, the Dow Jones in recent times rallies up whenever

there is a bad intelligence that hits the cable, as hare-

brained investment groups pour in money in the hopes that

dismal economic conditions might cause the Fed to extend

the stimulus plan.

One word of God Ben (that is what we can call him), deter-

mines whether stocks have to dramatically rise or fall. The

question arises, is this behaviour, attributable to healthy

fiscal system?

American fundamental finance has been devastatingly mur-

dered and clearly, such an abnormally large creation cannot

last without it. Stocks are supposed to perform based on the

true profitability of the businesses, and the external factors,

which would be the impact of political and social health. The

barbaric printing of paper is not in any way a catalyst for a

successful economy. In any case, the issue of the Fed actual-

ly ending QE is ultimately irrelevant now.

No construction can survive when it abandons bedrock fun-

damentals for fantasy.

Either QE continues, which in turn shall become less and less

effective in fending off negative results in stock markets,

inspiring a flight from the dollar leading to a collapse, or it

ends, exposing the inevitability of negative results in equi-

ties, leading to a crash. The difference that would exist in

the two situations would be, if the Fed ends stimulus in the

present, the process of collapse would merely take place

faster than if stimulus remains. However, if we go back in

time and observe, every historic crisis has a specifying mo-

ment, a minute in which the surge turns overpoweringly

sour for the public. The question now becomes, what exact-

ly will trigger the roll down?

The Precious Metals Secret:

China's intention to shift away from the US consumer & the


currency shall be the trigger and the Chinese government

seems to be dead serious this time. More than half of the

major economies now have a trade agreement with China

and the ASEAN Economic Bloc, which in turn removes the

dependence on dollar, for trade. China has been serious

with the agenda of making yuan the global currency and

therefore has constantly been issuing trillions in Yuan and

Yuan denominated bonds around the globe, arranging a

higher valuation and allowing Chinese consumer markets to

replace American consumer markets. At this point, the

dragon country has also increased its purchases of precious

metals to the point that the nation in the next couple of

years is set to become the largest holder of gold and silver

in the world.

An evident preparation for a currency crisis event...

The buying fling in the Eastern World seems to be in direct

contradiction of the paper market value of metals in recent

weeks. Demand for gold and silver has only been upward

moving, even in light of Fed suggesting a break to QE. Ma-

nipulations within metals markets explain the minuscule

part of the story, but there may be other issues at work. It is

not impossible, that the COMEX is now broken, and that

gold and silver Exchange Traded Funds are decoupling from

the street value of physical metals. In the near term, it is

becoming evident and belief are becoming stronger, that

premiums on physical will go towards the heaven, even as

the official market prices of those metals are held down. In

addition, at the same time, China, Russia, etc. are heavily

invested in gold, which may break from Western COMEX

completely and thereon using their own metals markets to

establish their own prices.

The wait is until the dollar loses its world reserve status, as

that happens, the countries holding the most physical gold

in their caissons stand to weather the storm, and because

America gold stores have never been audited, there can be

no idea drawn if America has any reserve.

Coming Soon, Crushing Energy Prices:

Another issue arising, which and has been hidden, is the

issue of energy. Despite diminishing oil demand caused by

the 2008 collapse, energy prices have experienced little to

no deflation at all. In addition, in recent times too when the

Federal Reserve hinted at shutting down QE, oil has been,

one of the few commodities that continued to rise. The

common intuition would be that, this is due to lack of sup-

ply, but the same has not been case, as many American-

based companies ramp up production during such times.

The apparent fact is that the current regressive global de-

mand and ample supply should have led to the gas prices

dropping, not going higher. Second thought would be, spec-

ulation, in that case the price should have been far more

volatile, with increases lasting days, but certainly not

years. The only credible thought and explanation for this

commodity activity is a weakening of its own currency

(indicating petrodollar). The life of petrodollar seems to be

ending, might not be in immediate, but certainly in the near

future and what we can predict or believe is that the trigger

shall be the next market exodus.

China has been supernatural in foretelling events, especially

when it comes to economic calamities, and therefore it is

not a shocker that it recently established a stupefying oil

trade deal with Russia, which shall supply an alternative

petroleum source for the next 25 years. Why am I talking of

China Russia deal? That is to draw in an attention, that this

deal has been signed with a bilateral trade agreement com-

pletely removing the US dollar. US dollar has been a world

reserve and the only currency, which was used to purchase

petroleum until many decades now. This deal has changed

everything around; it is a trend towards removal of petro-

dollar function of the Greenback, which ultimately will de-

stroy the currency.

The jumpy oil markets have also been caused by the social

unrest in Egypt; the Suez Canal supervises transfer of a sub-

stantial portion of the world’s oil shipping. There are, as

such two playing off factions within the country vying for

power, and regardless of who is best fitted to US interests,

the Egyptian people overall have no inclination for the

West. There is a trenchant chance of a war, in the coming

months in Egypt, possibly similar to Syria. In addition, Syria

remains a volatile trigger point for regional war which will,

in the end, result in the closure of the Strait of Hormuz

(which handles 20% of the world’s oil shipping).

If we sum all of it up together, all trends point toward in-

crease in gas prices, and the U.S. economy is barely able to

survive on the cost of energy we have as of now.

So Close, but Can’t See it:

So close, it is coming again, but people of The United States

of America cannot see it, or probably do not want to see it.

The plan for reduction in stimulus, which is the backbone of

the economy post crisis, combined with adversely high oil

prices, which are already on papers, may very well be the

tumbling boulders to bring down the mountain. It goes back


from the decade of 1980’s, when it all started, the

‘Destruction-ization’, that is what we can call it. This start

never ended, some or the other factors kept hammering the

natural growth of the economy. The stimulus measure has

so mingled in the economy, that it seems impossible for the

economy to grow without it.

The US ship is in the middle of the Ocean, it cannot move as

the fundamental machine has gone out of order, either it

floats where it is for a little long or then sinks into the bed

immediately, in any case it has to at some point of time.

It is very close now, beyond the undeniable economic fac-

tors that the very fabric of American government is dilapi-

dating. In addition, China, the precious metal, and energy

prices are increasingly creating pressure to sink the ship,

right to the bottom of the ocean bed. The only look now

remains, how long shall it be.

From a historical perspective, collapse has been carved and

it seems to occur in the nearest future, but the searchlights

of individual minds are still the dimmest, when the threat is

the greatest, and when we are most comfortable in our ig-

norance.


Introduction

Microfinance is an emerging phenomenon that has created capital avenues to individu-

als previously deprived from financial services. With its direct engagement with the

poor, microfinance represents a new way to potentially stimulate economic growth

from a grass root level. However, the concept of micro finance is poorly understood,

and it remains unclear about its delivering promises. Micro Finance tries to reduce the

inevitably increasing gap between the spiralling costs and diminishing incomes with

huge family burden. The basic purpose of Microfinance is to provide financial accessibil-

ity to the rural population there by providing impetus to overall growth.

India being an Agro Based economy where 70% of the population live in villages and are

largely dependent on agriculture and allied small scale enterprises. Of this 70%, 30 to 40

percent do not own land or even the basic amenities of life and thus do not possess

credit facility/collateral which is the main criteria for any bank to lend money. Tradition-

ally farmers tend to lend money from money lenders who instead of making their life

easy made even more miserable. This unorganized form of money lending gave birth to

microfinance which works on the principle of borrower’s skills, capabilities, trust and

belief not on the basis of collateral.

Unfortunately only 30 per cent of

the Indian population enjoys the

availability of ample opportunities

and amenities .While the majority

of the population has to live in

dire conditions. Unless and until

the basic facilities like infrastruc-

ture, Health, employment and

entrepreneurship reach rural, one

cannot expect sustainable devel-

opment and financial inclusion

In India both private as well as public sector provide micro finance facility. They can be

broadly categorized into two categories: Formal financial intuitions and informal institu-

tion. Formal financial institutions comprise of Apex Development Financial Institutions,

Commercial Banks, Regional Rural Banks, and Cooperative Banks that provide micro-

finance services in addition to their general banking activities and are referred to as

microfinance service providers. It also comprises of Apex institutions like NABARD, SIDBI

and RMK. Informal institutions undertake micro finance as their core activity and are

generally referred to as Micro Finance Institutions (MFIs).

Microfinance: An Emerging Financial

Market in India

Amit Singh, Spoorti Unki, NMIMS


Present scenario of India

India belongs to low income class according to World Bank.

It is the second largest populated country in the world and

around 70% of its population lives in rural area.60% of peo-

ple depend on agriculture, as a result there is chronic un-

deremployment and per capita income is only & 5729 per

month. This is not enough to provide food to more than

one individual .The obvious result is abject poverty, low

rate of education. Low sex ratio and exploitation. The major

factor account for high incident of rural poverty is the low

asset base. According to reserve bank of India, about 51%

of people house possess only 10% of the total assets of In-

dia. India has resulted low production capacity both in agri-

culture (which contribute around 17.8% of GDP) and manu-

facturing sector. Rural people have very low access to insti-

tutionalized credit (from commercial bank).

What is Micro Finance?

Definition:

The concept of Micro Finance was first introduced by Mo-

hammad Yunus, a noble prize winner, in Bangladesh in the

form of the “Grameen Bank”.-National Bank for Agriculture

and rural development

(NABARD) took this

idea and started the

concept of Micro Fi-

nance in India. In fi-

nancial term Micro-

finance is defined as,

any financial service

such as saving account, insurance fund or credit facility that

caters the needs of poor or low income clients so as to help

them in their development, there by improve their stand-

ard of living. Reserve bank of India has defined Micro Fi-

nance as follows:

“A company (other than a company licensed under Section

25 of the Companies Act, 1956) which provides financial

services pre-dominantly to low-income borrowers with

loans of small amounts, for short-terms, on unsecured ba-

sis, mainly for income-generating activities, with repayment

schedules which are more frequent than those normally

stipulated by commercial banks and which further con-

forms to the regulations specified in that behalf”

The main features of Micro Finance:

Microfinance provides loan without security, loan for below

poverty (BPL) line section and loan for self-help group

(SHG). The maximum loan limit is 50, 000 rupee with very

short loan tenure but with greater repayment frequen-

cy .However microfinance is different from the concept of

micro credit.

Note: Under Micro Credit, small amount of loans are given

to the borrower but under micro finance besides loans

many other financial services are provided such as saving a/

c, Insurance etc. Therefore Micro Finance has wider con-

cept as compared to micro Credit

Regulatory Framework for Micro Finance providers in In-

dia

Microfinance Institu-

tions (MFIs) are im-

portant for credit sup-

port in unbanked &

rural areas. They are

envisaged to play a cru-

cial role in expanding

financial inclusion. Sur-

prisingly this segment

has continued to be

largely unregulated. The

Reserve Bank of India regulates only those microfinance

institutions which are registered with it as non-banking

finance companies. They constitute a small percentage of

the total number of MFIs in the country. The Reserve Bank,

also does not prescribe lending rates for these institutions.

SEBI can monitor them, only if they get listed. SKS Micro-

finance listing has brought regulatory issues on the fore-

front. It went for Initial Public Offering to raise the money

from the public. Now this sector is also regulated by Securi-

ty and exchange Board of India. Reserve Bank of India has

given special rights to NABARD which is responsible for reg-

ulation of all non profit micro finance institutions struc-

tured as trusts, cooperatives or mutual benefit societies.

Overview of Micro Finance Industry in India

Micro finance sector in India is a fast growing sector. But

due to several allegations of aggressive collection practices

and borrower suicides, finance minister along with Reserve

bank of India has set up a code of conduct for interest rates

and recovery norms to make the flow of money smoother.

Some facts about Micro Finance Industry in India are as

follows:

The gross loan portfolio of India’s Micro Finance sec-

tor accounts for more than 7 percent of the sector’s

worldwide loan portfolio size. As much as 30 per-


cent of the world’s micro finance borrowers are in

India.

The average size of a microfinance loan is $522.8

globally, however, according to mix market data the

average loan size in India is only about a fourth of

that at $144

India has the largest Micro Finance market in the

world, with some 120 million homes with no access

to financial services, estimates CRISIL research. MFIs

are mostly concentrated in India’s southern states,

serving about 70 million.

Private equity firms have moved in, with MFIs ac-

counting for about 40 percent of all Indian private

equity deals in the last two years

There are more than 3,000 MFIs and NGO-MFIs, of

which about 400 have active lending programmes,

according to CRISIL research. The top 10 MFIs ac-

count for nearly three fourth of loan outstanding.

After going through the above data, the one thing which one

can expect from business point of view is huge and potential

market but how to grasp this market is biggest challenge!

Challenges in the field of micro finance:

Challenges can be seen from various perspectives such as

operational, governance, human resource development,

equity, educational, technological, regulatory, efficiency,

gender and livelihood. Although it is well understood that

the fortune lies at the bottom of the pyramid, yet money is

not flowing the way it should. Hence the biggest challenge is

how well the policy holder formulates the legal procedures

in order to make growth process inclusive, thus bringing

uniformity in regulation, transparency in operations special-

ly in interest rates and transforming the unstructured mar-

ket into a more organized market which can bring effective-

ness in the system so as to eradicate poverty, unethical

practices and proper composition of board and most im-

portantly find out a tool through which awareness can be

spread amongst the people in the field of microfinance.

Opportunity in the field of micro finance:

Opportunity is knocking the door as far as microfinance facil-

ities are concerned. This demand for microfinance can be

attributed to the growth open market, comparatively better

purchasing power of the target customers, and increase in

the demand for financial access. During the years when the

concept of microfinance was first introduced in the country

awareness was the key hindrance of the sectors success.

However with the technological betterment and improve-

ment in the infrastructure penetrating the target market has

become comparatively so not difficult task for the micro-

finance industry. Government regulation and policy are sup-

porting micro finance because they know it is the best tool

for the financial inclusion, poverty eradication, and educa-

tional encouragement. Hence the future of this sector is

very bright; however it depends upon the extent to which

responsible authorities provide consistent and adequate

attention.

Micro Finance

can act as a very

powerful tool

for the redemp-

tion of poverty

and making

people self-

sufficient and

thus provide an

opportunity for

overall inclusive development, economic development and

sustainable development

According to Professor C.K. Prahalad who is a renowned

management expert, “the bottom of the pyramid is the mar-

ket of the future. And if the pot of gold is buried under the

pyramid, then MFIs are best placed to dig out this treasure

that has been over looked for far too long”.

Conclusion

There is tremendous scope of expansion for micro finance in

India. It is the most emerging industry in India though con-

cept is old. With the help of Microfinance we can create a

poverty free India by eliminating poverty. One should under-

stand that poverty has been created and sustained by the

economic and social system that we ourselves have de-

signed, the institutions and concept that make up that sys-

tem; the policies that we pursue and so we can also erode

the poverty with the help of instruments like microfinance

thus benefitting individuals, government Organization and

ultimately the nation.


Poor are not poor because they are illiterate or untrained they are poor because they do not get return for their labour

It's inspiring to see one sector impacting so many lives for good and with such good intentions about whom no one has ever

thought off

A poverty-free world would be economically much stronger and far more stable than the world is today.

(By Mohammad Younus)

References

Mohammad younus,”Banker To The Poor”-an Autobiography, UK Arunum Press Limited

www.mfc.org.pl/

www.iitk.ac.in/ime/MBA_IITK/avantgarde/?p=475

articles.timesofindia.indiatimes.com/keyword/microfinance

www.microfinanceindia.org/

www.jstor.org/discover/10.2307/25830826?uid=2&uid=4&sid=21102490367011

www.makingitmagazine.net/?p=1711

www.xentrictechnologies.com/microfinance.html

business.rediff.com/slide-show/2010/oct/26/slide-show-1-rajni-bakshi-column-microfinance-in-india-how-skewed-is-the-

system.htm

Census report 2011

http://www.mfc.org.pl/

http://www.iitk.ac.in/ime/MBA_IITK/avantgarde/?p=475

http://articles.timesofindia.indiatimes.com/keyword/microfinance

http://www.microfinanceindia.org/

http://www.jstor.org/discover/10.2307/25830826?uid=2&uid=4&sid=21102490367011

http://www.makingitmagazine.net/?p=1711

http://www.xentrictechnologies.com/microfinance.html

http://business.rediff.com/slide-show/2010/oct/26/slide-show-1-rajni-bakshi-column-microfinance-in-india-how-skewed-is-the-system.htm

http://business.rediff.com/slide-show/2010/oct/26/slide-show-1-rajni-bakshi-column-microfinance-in-india-how-skewed-is-the-system.htm


“A brand is no longer what we tell the consumer it is – it is what consumers tell each

other it is”

Scott Cook, Founder Intuit and member of board of directors, Ebay Inc.

The quote above tells about the importance of social media marketing in today’s times.

With technology advancing everyday and people getting glued to their laptops and

smart phones more the rise of digital media in marketing has become a socially accept-

ed phenomenon. The rise has become a game changer for brands. For brand managers

and marketers the search for an optimized digital media strategy is the topmost priority

now.

Put simply the term social media refers to any site that enables exchange of infor-

mation and/or content through web to a large target audience which is usually (but not

restricted to) people known to the person posting the content. The content exchanged

can range from simple text updates on micro-blogging sites like Twitter to videos post-

ed on video sharing sites like YouTube. Social media has followed the path of exponen-

tial growth in recent years engulfing users to its fold in a virtual world which gives them

a chance to “CONNECT SHARE AND EXPRESS”.

(http://www.businessinsider.com)

The figure above gives an indication about the power and reach of social media. Ac-

cording to businessinsider.com social media has around 2.3 billion users. Considering

the reach it is natural for the marketers to take notice and try to get the biggest piece of

pie. As a result of this social media which is still a new channel has topped mobile in

terms of advertising expenditure. Of the total 4.5 billion $ spent on social media mar-

keting in 2011-12 Facebook tops the list with around 992 million USD. In contrast

Social Media- The New Battleground For Marketing Wars

Prafull Srivastava, Anshul Khandelwal, IIFT


In contrast Twitter and LinkedIn are far behind with 65 and

63 million USD respectively. The stark difference in the fig-

ures is not just because of the number of users but also

difference in on the usage type of Twitter and LinkedIn

which are believed by marketers as far more professional.

While social media was started with the thought of con-

necting people with friends and acquaintances, today it has

evolved into lot more. For a company it is a channel to get

loyal brand enthusiasts, for marketers an effective “virtual

word of mouth” publicity and for customers a channel to

stay connected to their favourite brand. The importance of

social media channels increases further because it is often

seen to affect purchase decisions.

“People influence people. Nothing influences people more

than a recommendation from a trusted friend. A trusted

referral influences people more than the best broadcast

message. A trusted referral is the Holy Grail of advertis-

ing.”-Mark Zuckerberg

If today’s customer is contemplating to buy a product, he/

she could just post it on his social media profile page and

invite his ‘network of trusted connections’ to get feedback

on the various options available and their reviews - instanta-

neously. Hence, today’s companies are also realizing this

insight to create communities around their products or

offerings, invite and encourage members to join them, and

then convert them into loyal customers and advocates that

would help them to gain more customers.

Today companies are leaving no stone unturned to increase

their social media presence. Coca cola with over 66.5 million

fans tops the Facebook list while Samsung mobile and NASA

take the top honours on Twitter. Talking about India, Tata

DoCoMo is the number one brand on both Twitter and Face-

book. However it must be noted that number of followers

does not always transform to engaged followers. More

often than not page followers would not always transform

to brand advocates for the brand. To make this happen

brand would need to benefit them too.

For example while Coca- cola is the top brand in terms of

number of Facebook fans it has, critics rate its arch rival

Pepsi far more successful when it comes to social Media.

Pepsi’s Refresh Everything campaign in which it asked its

"fans" to come up with ideas to "refresh the world" in the

categories is regarded to be one of the best social media

campaign. Ideas were voted on its site and

Grants ranging from $5,000 to $250,000

were given to implement these ides. Pepsi

plans to spend a total of $15.6 million on

the year-long program. The drive gained

Pepsi lot of publicity as well as sales too

rose significantly. On the other hand Coca-

Cola’s Eric Schmidt acknowledged that

their key social media campaign social

chatter only affected the company’s sales

by approximately 0.01 percent.

Source: Businessinsider.com

Source : Pintrest.com

Source : Pintrest.com


The recent Micromax logo design contest is an excellent

example how a company used social media to get a lot of

heads turned to them. Not just it helped to spread aware-

ness about the brand without spending a dime it got a host

of fresh logos to choose from. Brand enhancement and cus-

tomer engagement on social media will remain incomplete

without the mention of recently concluded Indian Premier

League. From team Twitter Battles to ESPN’s social compan-

ion. From Vodafone’s Super Fan contest to Yes Bank’s Face-

book and twitter Quiz, social media has brought fans a step

closer to their favourite stars and the game. Cricinfo.com

attributes a lot of viewer engagement of this year’s IPL to its

successful social media strategy.

Also social media has evolved as a preferred mode of com-

munication for brands to reach out to their target audience

in their social responsibility campaigns. Just last year Mum-

bai’s Dabbawala’s came out with Share My Dabba campaign

video on YouTube. The video does not talk about increasing

the business, its success has definitely positioned the organ-

ization as a socially responsible one. Some noteworthy suc-

cesses on social media include Zomato’s Instragram compe-

tition, Lipton Ice tea chill out campaign on Twitter.

It must be noted that while Facebook continues to uphold

its position as the jack of all trades businesses have found a

much dramatic success when they used a more specific me-

dium. Zomato for example was all about food and there was

no better way to connect with foodies than photos and in-

stagram was best for that. This strategy is similar to choos-

ing the right magazine or television channel to ensure that

your message reaches to maximum target audience. Social

media however stands out from its paper counterpart when

it comes to costs involved. A carefully crafted social media

can help companies to get a lot of attention for as low as

nothing. Even in case of a paid service the cost is much less

than the traditional media. This is the reason that a lot of

small businesses are turning to social media and have been

successful in their endeavours.

So while the above exam-

ples show the importance

of social media in today’s

times the big question

that remains is, “Is social

media marketing self

sufficient to promote a

brand”. Frankly speaking

while it appears that so-

cial media will probably

eliminate traditional me-

dia channels to many, it

seems highly unlikely today in a country like India. The lim-

ited internet penetration and the slow internet speed are

hurdles that stand before this media with no signs of a soon

approaching breakthrough. The firms today can at best used

social media as a supplement to their marketing campaigns.

But looking at the innovations and the developments taking

place in this domain it is safe to say that once these are

overcome social media marketing will prove to be a jugger-

naut Unstoppable and hard to contain.

Source: Mashable.com

References

Mashable.com

Blogs.hbr.com

Wikipedia.com

Businessinsider.com

Dreamgrow.com


Ever wondered that this world would be a better place to live in without having a trade

-off between a healthy living environment and technology? Technology is advancing at

rapid pace. There is scope for everything and none would deny the fact that most of

the things are possible technologically within given constraints. Then even an environ-

ment friendly world is possible without giving away with technology. In fact, possible

with much advanced technology. We are all aware of the hazards on environment to-

day in the name of air pollution, water pollution, radiation pollution and sound pollu-

tion. With growing advancements in the world, the importance of being environmen-

tally compliant has also catched up and is a matter of concern today. Hence green sup-

ply chain management in the field of operations today has become an area of interest

and some companies are tapping it up as a part its strategy for profitable margins.

Moreover government regulations and customer demands are further making the im-

plementation of this green supply chain management important. So what is green sup-

ply chain management, GSCM ?

GSCM is not about adopting business practices which are not aligned with the objective

of being environment friendly i.e. in simple words, if you as an operations manager

plan or as an owner give mandate to your operations manager to establish an efficient

supply chain such that the lead time is minimum, inventory levels are low and costs of

operations are also minimum then you are NOT implementing GSCM. So then GSCM

would be definitely achieving all this without compromising on the environment quality

we have around ourselves viz. all supply chain practices right from procuring raw mate-

rials to delivering it to the customer and later disposal of those products after usage, all

revolve around being “environment friendly”.

There are various green strategies that can be adopted and are being adopted to tap

this type of supply chain. The first one being risk based strategies which put compul-

sions on the suppliers to maintain environmental compliances while working in the

supply chain and in their raw materials. Ford motor company was the first one to use

this strategy with its suppliers. The drawback in this strategy is that it can be used only

when the retailer is giant enough (market share wise) to dictate such terms on its sup-

pliers. The advantage is that the power to produce the desired result reduces the ambi-

guity in obtaining the desired result. The next strategy is efficiency based strategy

wherein the suppliers are again put to test in meeting the desired operational efficien-

cy targets. This strategy allows for value addition at each step of supply chain by in-

creasing efficiency along with taking care of environmental standards. One must also

take into account that this strategy does not call for development of co-specialized

resources specific to environmental performance. It just requires careful focus on

waste reduction activities and recycling (reverse logistics), an aspect of GSCM. This is

something in line with lean management principles and we can say that we move clos-

er to lean management principles, also called world class manufacturing principles,

when we implement such green supply chain strategies. Such efficiency based

Going Green Way

Dave Aditya Bharatkumar, NMIMS


strategies also provide cost-reduction advantage and thus

improve economic performance. However, here again the

drawback is that not all retail outlets can practice such

strategies. The retailer should be giant enough to dictate

such terms of improved efficiency on its suppliers, for ex-

ample retailers like walmart in U.S. or Big Bazaar in India

are apt retailers for exercising such strategies.

The next strategy is innovation based strategy wherein for

products, the innovation can be brought about in the re-

sources being utilized to produce the products, the charac-

teristics of the product which are environmentally compli-

ant and the functionality and life cycle of the product. For

example, classmate which is a long book manufacturer

company uses eco-friendly and elemental chlorine free pa-

per. For operational processes, environmentally robust

methods could be developed for production, distribution

and usage of products. For example, walmart uses aerody-

namic system in its truck and nitrogen in its truck tyres

while transporting goods from warehouse to retail stores.

This increases the miles per gallon and thus saves on trans-

portation cost. This money is then passed on to their cus-

tomers.

The last one is closed loop strategies which is nothing but

reverse logistics. The returns flow of goods directed from

customer to delivery to warehouse to retailer as opposed to

the traditional flow from producer to customer. The ad-

vantage of this strategy is that retailer gets better visibility

of inventory in this reverse supply chain. If we talk about e-

tailing then according to Reverse Logistics Executive Council

(RLEC) (paragraph 5) almost 98 percent to the shoppers

base their decisions of purchase with an e-tailer based on

its return policy. The name closed loop refers to capturing

or recovering the materials used in the product during its

manufacture, distribution or selling and/or recycling it. Ko-

dak’s, for example, returns and remanufacture of disposa-

ble cameras or HP’s retrieval of used printer cartridges are

reverse logistics implementing companies in its supply

chain. This reverse logistics involves high level of control

over the flow of goods and may also involve technical re-

quirements for remanufacturing, if the materials are to be

recycled or reused. Hence the strategy may involve a huge

capital expenditure in machinery or plants or a considerable

amount of expenditure depending upon the size of the firm,

the type of the product and other geographic factors.

Another significant aspect in tapping the GSCM is the usage

of local produce. Let us take an example of a leading Ameri-

can bakery named Cold spring bakery in Minnesota. Here at

cold spring, they not only sell bakery products but also

those products which are of local origin and somehow con-

nected to the bakery products. For example, they sell

aprons of varied sizes made by a local women in Minnesota.

Also, they sell some local farmer’s items like sunflower oil

and some other items like different jams and jellies made

locally. So how does this local produce contribute to

GSCM ? The answer to this question that since the produce

is local, it does not involve huge transportation and carriage

costs and hence can be easily obtained in the bakery. This

reduces the air pollution that would have otherwise result-

ed from the coverage of larger distances while transporting.

Also, buying local has a degree of freshness attached to it in

customer’s mind. Even, Walmart is involved in providing

local produce to its customers by having 42 distribution

food centers spread across US. This allows for efficient and

fast supply chain which is environmentally compliant and

the benefits of saved freight costs are passed on to the cus-

tomers in the form of lesser prices. So, “Being local, being

different” strategy allows for a wider range of products to

be marketed from a marketing perspective at lesser costs,

being environmentally compliant by reducing the transpor-

tation distances and increased operational efficiency in its

supply chain processes accompanied with increased profits.

And all this is possible for a giant like Walmart and even

SMEs like Cold spring bakery.

To sum it all, if all the above mentioned strategies are ap-

plied in synergy, in one giant retailer like Big Bazaar in India,

then Big Bazaar supply chain management can be improved

considerably. For example, the first one could be opening

up of many distribution centers for Big Bazaar to reduce on

the transportation costs and thus carbon emissions, usage

of renewable sources of energy like solar energy and wind

energy (paragraph 7) (The fact of the matter is Walmart’s

348 stores in Mexico run on wind power and 350 stores in

Texas receive up to 15% of their electricity needs from Duke

Energy’s wind farm in Notrees, Texas.), usage of reverse

logistics - like there can be a mechanism in which customers

are enticed to return the used materials back to the stores.

Say, out of 100 customers who return the coke bottle after

use or a used table cloth after the purchase is done to the

store, one of them would win a luck draw coupon having

complimentary gift worth rupees 500/-. Also, a retailer like

Big Bazaar can conduct a contest for students to come up

with new innovative idea in the form of a product or pro-

cess with all the waste material recovered. Such activities

are very much in the direction of GSCM providing better

profitability, increased customer and employee


involvement and increased operational efficiency in the pro-

cesses. So, GSCM not only has its roots of benefits in opera-

tions field but also in the marketing domain.

However, easier said than done. In India we face political

resistance, corruption and governmental policies interfer-

ence which makes implementation part difficult. However, if

private players and public players decide on to implement

GSCM at all levels and take necessary steps in that direction

starting from very small ones like banning of plastic bags

completely or using IT as an enabler of GSCM to bring auto-

mation in most processes with the objective of eliminating

the use of paper and with Green Purchasing Network India,

GNPI (paragraph 8) evolving, the picture of GSCM imple-

mentation sounds practicable and we can hope to see a

green day, just like Walmart.

With Walmart now coming to India, the future of GSCM

implementation seems bright. As such, we have always

adopted the western culture after our independence rapidly

as a result of which we have witnessed lot of modernization

and drastic changes in our culture and lifestyle. So does this

mean that a “green” day will also be one of those gradual

changes (if not drastic) in the near future ?

References

RLEC, paragraph 5, www.infosys.com/industries/retail/

white-papers/Documents/reverse-logistics-

management.pdf

Solar energy and wind energy, corporate.walmart.com/

global-responsibility/environment-sustainability/

renewable-energy

GNPI, paragraph 8, Research journal of recent sciences, An

Overview of green supply chain management in India,

Nimawat Dheeraj and Namdev Vishal, Department of Me-

chanical Engineering, Singhania University, Pacheri Bari,

Jhunjhunu, Rajasthan, INDIA.

Figure 1: How to implement GSCM

http://www.infosys.com/industries/retail/white-papers/Documents/reverse-logistics-management.pdf



http://corporate.walmart.com/global-responsibility/environment-sustainability/renewable-energy




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-of-

sample 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

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

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

Rt = (lnPt – lnPt-1) x 100 …………………… (1)

Where, Rt = return at time t

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

I have used S&P CNX Nifty as it has got the most liquid stocks in its portfolio. Further, the National

Stock Exchange is largest in terms of Market capitalisation and Volume. I have used the data of the

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