What is a Business Downturn?
I could not find an answer to this anywhere on the net. At least not satisfactorily common man answers. There is a lot of economic mumbo jumbo being spat out that makes no difference to my idiotic mind. So, what is it and why has it supposedly made people very wary of doing anything positive and visionary at work?
Also, what was a continuous super boom even six months turned into an almighty doom now.
Sampath Nayak is a small farmer in the district of Sambalpur, Orissa. His brother is a cab driver in Mumbai. I asked him about the state of affairs back in Sambalpur. He had this three liner, “The same thing, like before, no electricity, no water, bad seeds and no rains. One Crop and just enough to fill our stomachs once a day. I don’t know whether that is bad or good!”
I have heard about other states and a similar story of gloom through the last few years. So, they are our have nots who have not got any proceeds of the supposed boom.
So, who have benefitted? If we whittle down our country population to 100 and do a simple study, we shall find that the boom will have affected not more than 7 people from among this 100. I may be wrong in my calculations. But this is what the Human Development Index 2007 says.
So, it is gloom and doom for 7 people. Fine. But, these seven now control the loudspeakers of this country. So, if they are shouting doom, then so be it.
The benefits of the boom were never passed on by the companies, real estate barons and Investment banks that made their dough in the near past. It is they who have hit upon tough times. As the hoard turned bad. So, I have another term. Greed. Very known but seldom used.
So, we happily followed the dictum of some guy from a movie out of Hollywood - Greed is Good!
Great, all is fine but now the shit has hit the fan. The guy from that movie is not making a sequel and telling us about what Greed now is. USA is grappling with the aftermath of the mortgage crisis. They have a sound Federal system with its checks and balances. They also have a sound education system that will ensure the learnings from this shall not be forgotten in a hurry. They will make do. What about us?
The downturn in my eyes is:
1. The relearning process. What is right and what was wrong.
2. The required understanding of how a company should make money.
3. The strengthening of Fundamentals. The requirement of any business. Get your facts right.
4. The concentration on Processes and Knowledge development rather than adhocism.
5. The basic understanding that money is not so easily made. It needs diligence.
6. Have to do hard work!
It is not actually a downturn but nature’s way of telling us to be more inclusive in our growth as an economy. Money in fewer hands has to make way for money in more hands. If this fundamental is taken care of, a jitter in NASDAC will not shake somebody’s arse in Raipur. Not that it has even now. Our media just don’t know the business reality of our own country based as they are the two leading cities and rarely if ever travelling to the hinterland except for elections and natural calamities.
So, I believe that is a nice warning bell for predating companies to introspect and understand the nature of country, train its people to work hard and expect suitable results only.
The real alarm is elsewhere. We are deficient of very basic economy and growth differentiators:
1. Our Education is headed southward in Quality. Research and Development is at an all time low. The cities are mass producing engineers and MBAs who have no specialities and Innovation capacity. The hinterland while producing graduates are unable to get them to go up the L&D ladder. So, talent and its usage are still abysmal and what is progress without the Human Resources!
2. Job and wealth creation is a complete sham. Ask an average citizen and he has no clue how to get things going to achieve all this. The inherent idea of all inclusive progress is absent. So, it is herd mentality that prevails. Let’s take IT as a case study. In the mid 90s, just as US realised that there were a lot of jobs at one end of the food chain in the IT industry that could be farmed out to other countries to save costs, we grabbed the chances and progressed as an IT service nation. The turn of the century saw ITES also take the same route. Media went bonkers with the scene and India became the back office of the world. Some companies understood that the basic work would not last them for years and went on to create more products and services that probably would last the test of time. But others, who were simply looking for the buck, are in deep shit now. Even if no one says anything, the writing is pretty much on the wall. No new products, no R&D, no killer apps, no developments from university labs and most importantly, no hunger or appetite for Innovation or invention. So, what wealth creation are we talking about for the man on the street. Only the share market fellas and a few Investment guys doing trade in Land bought their Pajeros and Villas!
3. Bureaucracy does not permit Risk taking and Entrepreneurship as yet. First, the guy is basically risk averse because of the voodoo surrounding business in most communities except select ones and then the government does not promote or support it. Even if they do, conservatism by banks, institutions or peer groups overturns all the enthusiasm into cold sweat very early enough. Numerous guys with stars in their eyes early in life decide to settle for the quiet little job. Roam the countryside and you will find scores of youngsters wanting to set up that pharma lab, small savings company, PVC plant or restaurant settle for a job and lose it forever.
4. The mass at large have no direction. Bad schools that tell you nothing about ideals and ambitions. Colleges where you just go to pass an exam. Teachers who are largely failures themselves. Parents who just don’t have any clue. TV that tells you nothing positive. News that is depressive. Factories that have no excellence. Mentors who don’t impart wisdom. Managers who are busy saving their jobs. Loose tongues, Loose morals, Indiscipline and Impatience have largely fucked the country beyond redemption. Oh and Yes, the politicians and thought leaders are clueless. The bureaucracy is still in the British era. What a state of affairs!
This is the biggest downturn. In the garb of garbled progress we have unitedly pulled down all institutions of the country. So much so, 10 bloody terrorists just wangle their way into our land, rape us and the media beams our abject state to the whole world. What a downturn!!