Trouble in Eden !

There was once a magical land named Eden where the Demi-gods lived, where dreams came true, it was a place where wishes came true and for little efforts, rewards were huge. The Demi-Gods were kind and admitted the mortals freely and for devotion, mortals were rewarded with gold, plush houses.

The mortals from earth could come visit Eden and live for a few years, earn huge fortunes and go back to their land much wealthier and influential. The Demi-Gods just wanted the mortals to make statues and to glorify them.

As the story of the mortal artisans making the trips to Eden became more and more well known, the mortals realized this was an easy ticket to ride. Several schools to train and deploy artisans began to spring up. Other trades began to be ignored, the sole motive of mortals was securing a gateway to Eden.

Like all good things, the good times at Eden also had to come to an end. By the curse of the sages, Eden was struck by a series of natural calamities like quakes and storms. Suddenly the demi gods no longer had the luxury of entertaining the mortals.  Suddenly the demi-gods wanted the mortals out, they began to see the mortals as parasites feeding on their great society.

The mortals were concerned, and once the gateways to Eden began to close, politics and opportunism began to take over, it was no longer easy for people to reach Eden. The journey to the promised land of Eden has just become a nightmare, with thousands and thousands of mortal artisans waiting for their turn to enter Eden, life just got tougher.

As you might have guess, this story was a thinly veiled reference of the Indian IT services industry and the situation in the Western World. India was fortunate to have an army of English speaking programmers who could take on the Y2K problem. Any one who was lucky enough or smart enough to catch the IT wave became quite successful, however the same cannot be said for the young engineering graduate passing out of college today as circumstances have become much more challenging.

Trouble in BCCI Paradise

Today Feb 4^th was an awful day for BCCI / IPL with the withdrawal of Sahara India franchise from both the Pune franchise and Indian team sponsorship on the day of the IPL 5 auction. 

The collapse of the Kochi & Pune franchises, the cricket TV rights debacle with Nimbus and the waning form of the Indian cricket team overseas, BCCI is looking at both severe reverses in financial and cricketing fronts.

Just a year back, India winning the ODI world cup and humongous amounts which Kochi and Pune franchises paid for the slice of the IPL action.  

Need to phase out the legends

Indians have always been in awe of their cricketing Gods – they can never imagine them to age and retire on time. It is always a case, we ensure they overstay their welcome and give very few chances to blood new youngsters. It happens when it is too late. 

Cricket Australia has been quite ruthless to cut legends down to size when needed, be it Ian Healy, Mark Taylor or Steve Waugh. 

Over all fitness / intent

Forget the slow moving gentlemen like VVS Laxman and Rahul Dravid, younger players like Zaheer Khan and Virendra Sehwag seem so tired and bored to take to the field.  

Easy IPL money

Ravindra Jadeja picking up 2 million $ is crazy for playing a domestic T-20 league to bowl 4 overs and slog the bat. The IPL is an unlikely villain which incentivizes slam bang cricket and further de-incentivize classic test cricketers on the lines of  Wasim Jaffer or Akash Chopra.

DRS obstinacy

One bad experience in Sri Lanka with the DRS, Indian cricket is ready to block DRS thus ensuring cricket games are no longer played in the same playing conditions. The chances of human error can be minimized but never eliminated. If cricket boards had played similar hard ball in the early 90’s we would never had the third umpire.

Neglect of other domestic tournaments

Apart from IPL, the older domestic tournaments like Ranji Trophy, Duleep Trophy are not getting crowds and even the performances in these games do not get the same visibility of an IPL.

We are creating a generation of T-20 focused cricketers ignoring the other formats of cricket. 

Overpriced business models

SET MAX, Neo and the IPL franchises have definitely over-invested and paid huge amounts, the number of meaningless games and waning interests in both cricket grounds and dropping TRPs is clear that the game is going to see tougher times ahead.

Is there Hope ? I don’t think so

Usually I conclude my posts on an optimistic note but I don’t see one here, a game which is run by business men and active politicians who have no love for the game, a cricket coach and selection committee who cannot take tough calls, this are only going to more bleak. I don’t see any conviction in the cricket administrators to make a change. 

Remember Sachin Tendulkar will retire soon one day, it is going to take some great magic to get the average Indian fan turn on his TV set for 5 am Test match versus Australia or buy a ticket for an IPL match.  

Sahara has seen the storm coming and there is trouble in paradise.

Lessons from Iaccocca one of America's most respected business professional

After a long time, I decided to read Iaccoca’s autobiography again as several years ago when I was an aspirant to do my MBA, somebody told me this book was a good start. It did make some sense back then but it had even more sense now. Clearly reading the book the second time, you do realize the man has a very large ego and most of the book is written in first person, it takes pot shots at opponents and glosses over personal failures. Although it is an engaging book, it is not very objective and projects as Iaccoca as a superman. In my mind, the most objective business book written by a corporate manager must be ‘Who says Elephants cannot Dance?’ by Louis Gernster the CEO of IBM who oversaw the reinvention of the IBM business strategy in the late 90’s.

Who is Lee Iaccoca

Iaccoca was the son of an Italian migrant who went on to become the president at the Ford motor company, he was subsequently fired from his job at the age of 54 as a result of differences with the CEO and owner Henry Ford Jr. Instead of going home and enjoying retirement, he took over the reins of a financially struggling company Chrysler by taking a loan bailout from the US government and made it up and running again. This bailout package which has become so common in today’s economic scenario was extremely controversial in the early 80’s. One ironic fact, when Iaccoca testified before congress for a bailout, one of the staunch opponents was then chief executive of Lehman Brothers on the basis that a bailout was against the principles of free market economy. It is amazing indeed how times change so quickly.

Lessons for Professionals

Need for a good boss – It is very important to have a good boss to look up to. A good boss not only helps you to get the best of your professional capabilities and also helps the organization to be more profitable and sharper to handle competition.

Data is important but avoid analysis paralysis - Iaccoca is a believer in having good data and research work but it is not a great idea to wait endlessly for some small piece of data when you have more than 80% facts already.

Need for strong corporate governance - During his Ford days, Iaccoca talks about how the management regularly misused the company resources for personal use. The directors on the board often have collusions with the company executives which lead them to ignore excesses in financial planning. The problems faced by Chrysler highlights this fact. This point is pertinent as Iaccoca pointed this out in 1984 long before the Enron and Arthur Andersen scandals which shocked the world.

Lessons for Politicians and Economists

America is investing too much in paper money – Iaccoca in his closing remarks mentions that America is slowly moving away from a manufacturing and export driven nation to an import driven economy in many key sectors. An obsession with paper money was creating assets on paper instead on direct investment in the American economy. This point is well made as America has plunged into the subprime crisis and secondly the FIIs have been fuelling the economies of developing countries like India, China, and Brazil instead of strengthening the job market in the US. (Not that I am complaining about it, the IT industry boom has helped several professionals including myself to make a living and put India on the global map)

The debate about capitalism versus communism is dead- In the 80’s when Chrysler Corporation, the third largest American automobile company went to the government for a bailout package; it was severely criticized in the media and financial circles that it is a bad precedent. Now after the failure of the USSR in the later 80’s and the American economy meltdown in 2008 now question of taking extreme stands on capitalism versus communism is futile. You need free markets and competition but it has to be coupled with checks and balances in form of an industry regulator.

End Note

In the book it is mentioned, in 1980 when Chrysler was undergoing the financial crisis and was in line for a government bailout, the stand-up comedian Bill Cosby made a joke on the company's financial condition. "A guy was so mean... so mean that he called up Chrysler and asked them how is business?”

Two days back, Conan O Brien on the tonight show said“You know why Chrysler’s cars are the safest in the world, because most of them don’t leave the dealer’s store anyway”

The greatest lesson from history is that it repeats itself because men do not learn lessons from it.