Doing Business In India

The Satyam episode has become a joke on Corporate Governance, Questionable Polity and Degenerating Ethical Standards. I had mentioned my views in this blog, Satyam Saga…..Is Corporate Intelligence Adequate In India?, a couple of weeks earlier.

In all this mess, there are some blokes who have the sense of humour to make a joke of this ugly episode.

Chief Minister of Andhra Pradesh (the State in which Satyam ex-boss, Mr. Ramalinga Raju had political patronage), Mr Y S R Reddy went to a school. After have a brief talk with the children he asked them if they had any questions to ask him.

One boy raised his hand and stood up.

YSR: Whats your name?
Prakash: Prakash

YSR: Whats your question?
Prakash: Sir I have three questions.
1) Why did the Andhra Pradesh government provide so many land deals to Raju?
2) Where is the Rs.7000 crores?
3) For all the controversial situations, why does the ruling party alway blame the rival political party?

YSR: You are an intelligent student Prakash..(just then the bell rang for recess).

Oh dear students we will continue after the recess is over.

After the recess

YSR: Ok children where were we? Yes, so anybody wants to ask any question?
Suresh raises his hand

YSR:Whats your name?
Suresh: Suresh

Suresh: Sir I have 5 questions.

1) Why did Andhra Pradesh government provide so many land deals to Raju?
2) Where is the Rs.7000 crores?
3) For all the controversial situations, why does the ruling party blame the rival political party?
4) Why did recess bell ring 20 mins before the scheduled time, and
5) Where is Prakash?

Obviously corporate intelligence is not adequate and investors are not safe. They all seem to be talking about a Rs. 7000 cr fraud, but what about the billions lost in capitalisation of the Satyam stock and consequenlty the market slide. This is the worst kind of fraud that have been perpetrated with a cold mind.

There are two questions that need to be answered:
1. After the corporate governance issues with the Maytas deal, why was Raju allowed so much time? Obviously there more top management people involved than just the Chairman (as he confesses)

2. What were the Auditors doing? Need to closely look at the various relationships that audit firms maintain with clients. That could result in compromising their position. Audit firms should only have one relationship…that is conducting audit. After Enron, Aurther Andersen was disbanded and sold off and the consulting arm became Accenture. All firms should delineate audit and consulting function in seperate entities.

All this proves that we need better corporate intelligence.

Vivek Parti, CEO, India Business Database.com, Business Credit Information Company

The financial markets are shaky and people with cash are making their moves. The first out of the block has been the undoubtable Mr. Warren Buffet. His keeness in Wachovia thru Wells Fargo is a smart accumulation of financial assets. Then there is General Electric that has readied a war chest for meaningful and related acquisitions.

Similarly Indian companies that have their DNA in risk aversion can now, in a low risk environment (low risk since globally valuations have taken a severe beating), scout for opportunities inorder to fulfill corporate objective of technology advancement, global reach or simply securing supplies.

Before you set out a word of caution. Do not blindly pursue acquisitions based on a trend or your competitor’s aggression. Make your move after you have set out your long term strategy and have carried out a thorough due diligence. For global business research, you can find assistance at indiabusinessdatabase.com

Yes there is slow down in the global business environment. Couple this with all the disturbances: the middle-east uncertainity, Pakistan meltdown, and the general war against global crime. We as global citizens are paying beyond our means to finance this war.

But some of us find opportunity among the ruins. Read this article on OPPORTUNITIES make the best use of it. Aren’t we still in business? Delhi got back to business even after the cracker show…………..

Hi. Its been a long time since we last met. While surfing I came across this wonderful information and I thought I should share this with you. CII is looking out for 15 Indian small and medium enterprises that can access international know-how with the support of country’s top technology and management institutes by introducing a three-year training programme.

The Visionary SME Programme set for a September-end launch would have contribution from experts at the Indian Institute of Management, Calcutta and the Indian Institute of Technology, Madras along with Shobishiba, a Japanese management consultant.

The programme would start with 15 firms initially and the volume of participation would grow later depending on the success of the maiden run.

CII is going to create model small & medium enterprise (SME) of global standards by selecting 10-15 SMEs from different sectors in association with IIM-Calcutta, IIT-Chennai and a Japanese consultant, Shobi Shiba.

In uncertain times businesses face tough situations. Most of them go about doing the same routine until the situation around them eases or they bite the dust. But proactive managements assess the situation clearly and take corrective steps. Steve Report has written a well-meaning article on the same subject. Steve says
“What are “The 5 Steps To Stop Insane Management From Driving Business Into The Ground?”

1. Have a very clear profit plan at each line item of business performance. Measure actual performance against plan and have clear accountability for achieving the plan line item by line item. To implement this you must have timely, accurate and relevant information. No excuses…must have.

2. When people who are accountable for line item performance consistently fail to meet the stated goals, replace them. Period!

3. The number one function in a business that will be the subject of most of the excuses is sales. These excuses come from people who do not understand how to market to a consumer who places ever increasing importance on relationships. Why do you think the community building sites like YouTube, MySpace and Facebook are in the top ten most highly visited sites globally? According to Alexa, YouTube is 3 , MySpace is 6 and Facebook is 8 ) Every business must have a relationship driven marketing strategy and then implement it. See Relationship Marketing below.

4. Always be evaluating the market including on line competitors. I wonder if Microsoft, Yahoo and AOL in retrospect would have done anything different when Google first came to market? No company is immune from being seriously weekend by competition. I look at the drugstore landscape. I live in Florida where competition is very active particularly for pharmacy prescriptions. A new format of drugstores was introduced not that long ago by Walgreens, CVS, and others with positioning of buildings with 24 hour drive through pharmacies on high cost real estate. Two things have happened with those changes. Prices skyrocketed to pay for real estate and relationships with the pharmacy customer has almost become extinct. Within this landscape I am aware of several privately held drugstores doing very well because of their attention to customer relationships.

5. Don’t push a boulder up hill. Some companies were never meant to be. People start companies or buy existing companies because they think it is a good idea. The only opinion that matter is the market. If your business was not all that strong in the past and you are basically doing everything right, the best action to stopping the profit leaks may mean closing the doors. If you are not sure Contact Me.”