Thursday, March 28, 2013

Flying without Frills, but Bang on Target – Till now

SpiceJet’s Consistently good Performance over Five Quarters on a Trot is Helping redefine The Business Viability of low-cost Carriers in an Industry which sets Great Store by Premium Services.

Quite often, abrupt changes in a company can rock the business boat. Or they could nudge the company into taking a new direction or chart a different path. At SpiceJet, India’s second-largest low-cost airline, which got a new owner and then a new CEO in recent months, the recent changes have set the airline on course for exciting times ahead. Ever since south Indian media tycoon and Sun TV chief Kalanithi Maran (grand nephew of Tamil Nadu Chief Minister M. Karunanidhi), one of the richest men in India with a net worth of more than $3.5 billion, bought a 37.7% stake in SpiceJet through his company KAL Airways for Rs.7.39 billion in June 2010, the airline has been making both positive moves and news. In November last year, Maran raised his stake to 38.66% for an additional Rs.1.46 billion taking his total investment to about Rs.9 billion in SpiceJet. Clearly, Maran was betting on heady growth for budget air travel in India. The airline has also seen top-deck management change with new CEO Neil Mills taking charge of the cockpit in October 2010 last year.

Analysts believe that the airline industry will clock a growth rate of 15-17% annually over the next few years and low-cost carriers will capture three-fourths of the market. Passenger traffic grew 19% YoY in 2010 to 52 million and is expected to grow 19% over the next five years. With air travel once again booming, the biggest growth segment for the aviation industry is going to be the budget airlines. Analysts like Dhiraj Mathur, Executive Director, PwC India, tell B&E how the Asia Pacific region (including – India, China and West Asia) is set to be the driver of high growth in the aviation industry. Subsequently, the number of commercial aircraft in India would touch anywhere between 575 and 600 in 2015 and 975 and 990 in 2020; and one reason for this growth is the apparent success of the low-cost carrier model.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

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Monday, March 18, 2013

“The Consumer is A dictator...”

Maruti did Well to Capture Rural Attention. But it would have Done Better by Increasing Supply and not Missing out on Demand in the Cities!

Whether it is the announcement of the launch of CNG versions of its cars, or the fact that the company has finally come to take the Indian rural consumer seriously, it has all worked in favour of Maruti Suzuki. B&E talks to Mayank Pareek, Managing Executive Officer of Maruti Suzuki, who has been one of the strongest pillars of Maruti’s citadels over the past two decades, on the rural-consumer focus that really worked for Maruti during FY2009-10, supply-demand mismatch and the changing consumer psyche...

B&E: It is believed that Maruti Suzuki really began to focus on penetrating the smaller towns and rural parts of the country under your leadership. How has the strategy paid off when it comes to helping the company’s topline grow?
Mayank Pareek (MP): From contributing about 1-2% to our revenues, today, rural and tier III markets account for about 18% of our annual revenues. We mostly sell our smaller cars there. Even during the past financial year, the response we got from the smaller locations was tremendous. The rural fairs that we conducted helped to attract many consumers towards our brand. There were many buyers in such fairs who came with bags full of money. They are the lot which prefers a 100% down-payment mode of transaction than visit dealerships, where they are not very comfortable with English-speaking salespeople.

B&E: So do we primarily say that rural India helped revive your sales? And how about the bad news that most of your products are short in supply?
MP: The main reason for the revival in sales in FY2009-10 was the potential of the Indian market. It is such a huge market that there is space for everyone. You just need to set the right agenda and innovate continuously to make sure that the products stay relevant to the target consumer. For instance, when the world was being troubled by the recessionary winds, we at Maruti had established a strong base in the rural parts of the country. The basic reasoning was simple – if a Lehman Brothers is crashing in the US, it hardly bothers the consumer in the rural parts of India. Also, along the way, we have broken many myths. One of it is rural means poverty, which is not true at all. Today, close to 2% of our total sales comes from villages that have less than 200 habitants. Therefore, today we are in a situation where the consumer is demanding, but we don’t have enough production capacity to meet that demand. Hence, almost all our products are running on waiting period. But that too is a healthy sign, isn’t it?

B&E: How about producing more cars...?
MP: We are investing close to Rs.25 billion to set up a new plant in Manesar (Haryana) which will give the company an additional capacity of 250,000 vehicles annually by 2011. But till then, we will have to manage with our existing capacity.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles


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Tuesday, March 12, 2013

T20 of Theatre is Here!

T20 of Theatre is Here!

“Short+Sweet originated from Sydney in 2002, and it’s a festival of ten-minute plays. It has grown from Australia to New Zealand, to Singapore, Malaysia and is now in India. We think that 10-minute theatre fits the modern world. It’s value-packed theatre, and not a moment is wasted as you have to get your idea across in a short span of time,” said Michael Wood, Producer of the Festival. The timing is the key parameter here, and so every play is timed in this Festival, and a play that exceeds the time limit is disqualified. So while Rainbow in the Sea by Smriti Vij and Aarjoo was exceptionally poignant and powerful, it was disqualified from competing for the Gala Final as it overshot the limit by three minutes.

Theatre has for long been treated as a poor cousin of cinema, and it is almost treated as a stepping stone for artists trying to find their inroads into the film industry. Could a shorter, snappier format better its condition? “Because it is 10-minute-theatre, young people identify with the format, it’s consistent with the YouTube and Twitter generation’s style of entertainment. So we have younger directors, writers and performers, who then bring in much younger audiences. What we found in other countries is that Short + Sweet is a very powerful tool for attracting new, younger audiences into theatre,” says Michael Wood. My personal favourite out of some 12 odd plays that I watched was by the students of Hansraj College. Guess youngsters here have already caught on with this format!

Read more......

Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles


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Wednesday, March 6, 2013

River Ganga: Too Busy Cleansing us to Clean Herself

The NGRBA needs another 10 years to Clean up The Ganga; Will it be Too Late by Then?

Like any other mother, River Ganga lets us get away with a lot of things. Our latest liberty has to do with an extension of deadline to rid her of the enormous amounts of trash and swill that she’s brimming with (courtesy other liberties that we take, like dumping our dead, and discharging all neighboring industrial sewage, into her waters). Last month, the National Ganga River Basin Authority (NGRBA) presented a time frame of another 10 years to the Supreme Court of India, promising to clean up the Ganges by 2020. ‘Mission Clean Ganga’ has even roped in a consortium of the IITs hoping to make serious progress on the stated objective.

Much polluted water has flown under the bridge since the Central Ganga Authority (CGA) was formed in 1985 under the then Prime Minister Rajiv Gandhi, promulgating the Ganga Action Plan (GAP). GAP I graduated to GAP II in 1993, and GAP II was merged with National River Conservation Plan (NRCP) in December 1996, and now gaps are all that remain in the efforts to keep the nation’s most culturally and ecologically significant river system healthy.

Rakesh Jaiswal – tireless Ganga campaigner for the last 15 years, and founder of Kanpur-based NGO Eco Friends – lists “the depleting quantity of water downstream, owing to diversion of fresh water through canals” as the greatest threat to the Ganga. “Pollution is another important threat. Major contributors are Point Sources: 70% of the pollution can be attributed to sewage drains and 15% to industrial wastewater. Rest 15% is caused by Non-Point Sources (dead body dumping, dumping of worship materials, cattle wallowing, laundering of clothes, agricultural run-off etc.),” he adds.

Despite intercepting many guilty tanneries and factories on the riverbanks, and the commissioning of corrective infrastructure (sewage treatment plants [STPs], crematoria, pumping stations and the like) by the first and subsequent phases of GAP, the Ganga continues to flow like one big nullah or dumping ground. The presence of pathogenic fecal coliform bacteria – nearly ten thousand times the acceptable Indian Standard of 50-5000 Most Probable Number (MPN) per 100 ml of water in parts – and dangerously high levels of arsenic, lead and mercury make the mythically pure Ganga, believed to be capable of cleansing one of all sins with a mere sip, nothing more than a poisonous sludge snaking through the Northern Plains.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles
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Tuesday, March 5, 2013

The Aulbur exit interview

In an Exclusive Interview with Sanchit Verma, Dr. Wilfried Aulbur, the outgoing MD and CEO of Mercedes-Benz India reveals his insights into the Indian luxury Auto segment, making Mercedez the No. 1 luxury auto brand in India and the general dynamics of the fast developing luxury automobile segment in India

Dr. Wilfried G. Aulbur, a post doctoral researcher from USA in the fields of Semiconductors, Material Science and Solid State Physics has been heading Mercedes-Benz India as MD and CEO since 2006 prior to which he held Business Development & Strategy function at Mercedes-Benz’s R&D Center at Bangalore. Being married to an Indian, he has close professional and personal ties with India. Here, in a candid conversation with B&E before bidding farewell to Mercedes-Benz, he shares his deep insights about the company’s India operations, its rapidly growing luxury segment business and its successful entry into the truck and bus segment as well as the luxury auto segment in India.

B&E: Your resignation has come as a shock to many. After heading Mercedes-Benz for over 4 years, what drove you to take such a decision?
Wilfried Aulbur (WA): I have been here for the last five years. My contract would have ended in 2011, but I got a very exciting opportunity right here wherein I can change my role from being an employee to a co-owner. That’s what triggered my decision. Moreover, it’s also giving me an opportunity to stay in India and maintain the relationships that I have built over the last five years. Talking about Mercedes-Benz, I would say that we have done a lot in terms of going into the passenger car business, increasing our R&D activities, increasing our sourcing from India, re-structuring our network, starting the CV venture and establishing it successfully. In fact, there are a number of decisions related to additional investments in new products, which are close to finalisation. So, the overall situation is quite positive, quite stable and the team in itself is highly professional. Thus, I believe, it’s a good time for me to move on.

B&E: After your long stint with the auto industry, where are you heading now?
WA: I have been with the auto industry for 11 years and before that I was into research and development in the IT industry. But the rest, I’ll tell you once I am done with my negotiations with Daimler (smiles).

B&E: We have heard a lot about your love for the country. Is your decision to stay in India somewhat influenced by the same?
WA: I think India is extremely exciting and I believe that there will be a lot of opportunities coming forward on its way. As per my new role (to be taken up after my formal exit from Mercedes Benz), I think I would be able to contribute more in supporting the country’s growth and development in many industries. That is the primary reason for my shift.

B&E: You have been associated with Mercedes-Benz for quite long now, both in India and Germany. How do you think the company’s strategies differ in Germany, when you put them in line with India?
WA: Indian market is still growing and it will continue to grow rapidly. We will see about 40,000 to 50,000 Mercedes-Benz cars being sold in the country in another 10 year or so. What’s more interesting is the fact that in India, selling a Mercedes-Benz gives you the opportunity and privilege to interact with the most elite group of customers. But, when you look at Germany, you will find that the customer base is much broader. In Germany, we have a market share of around 8 –10%. That means every tenth new car sold is a Mercedes-Benz and we are the clear leader in that market space. This makes us meet a wider range of customers there and thus the way we interact with them is different. The interaction with the customers in India is much of high-touch engagements. Here we need to go for different kind of activities like golf activities, the star drive experience, the current ‘Fascination’ concept that we are running across the country and so on, which we do not require in Germany. So, in short, I would say the Indian consumer is very different from the consumers we interact with in many other markets.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

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