In life its not sufficient to be merely efficient but to also be effective.
Someone once asked my father Man Singh ji, 'What is the secret of your success?'
He remarked, "I do not always make right decisions. I make decisions, and then always make them right"
In 1990 Transmissions division of the $9 Billion Eaton Corporation America were going through a rough phase in the UK. Eaton was continuously losing money and lots of it. They needed to bring their costs down. Eaton's order books were full but costs were too high. Automation, and various initiatives had helped but insufficient to stem the flow of red ink.
They needed to reduce the cost of their procurement which represented 45% of their cost. They needed new and cost effective suppliers. My friend Veraf Khambatta introduced us to Eaton Corporation.
We four brothers inherited a small industrial business from our father and Uncle which with hard work and good fortune we successfully grew into a legend. I was responsible for operations and exports.
There followed a spate of visits from both sides and the indecisive discussion went on and on for nearly 18 months.
Eaton loved our facilities and our capabilities but were hesitant about working with India. We were enthralled by the mouth watering opportunity of the size of business but were disheartened by the very low and unprofitable prices offered by Eaton.
Eaton had bench-marked procurement prices to what they were purchasing from
Huta Stalowa Wola of Poland.
Polish economy and society at that time was in serious trouble. The collapse of the Soviet Union and the consequent shift from communism to a new and uncharted era of free market economy had idled factories and entire towns and cities.
The Polish factories were so desperate to stay afloat they accepted the work at ridiculous prices. A windfall opportunity for Eaton but a headache for us.
Eventually a new and dynamic buyer at Eaton called John Anderton took the initiative and stuck his neck out. He improved the value of the offer made to us and simultaneously took responsibility for delivering attractive results to his management at Eaton attractive results. However the revised prices were still unattractive.
Being an engineer, I relied heavily on data always proceeding logically. This led to efficient approaches but sometimes not effective for seizing opportunities.
I was handling negotiations on behalf of our organisation and refused to sign the deal. I almost threw in the towel, when Varinder my elder brother who is a brilliant marketeer counselled me. He asked me to accept the prices but for a much smaller size order to keep the relationship alive. We took the business at the prices offered. We not only ensured but also enhanced our usual world class quality and delivery performance. Eaton was simply bowled over and we soon became their preferred supplier.
The high standards and tough prices demanded by Eaton forced us to adopt path breaking programs to further improve our processes and efficiencies. This was a boon to us in the long run as the benefits spilled over to all aspects of our organisation. We achieved significant, cost savings and enhanced quality and reliability. The boost to both morale and performance of our entire organisation, was incredible.
Subsequently as the Poles got back on their feet they did not feel compelled to continue with their loss making prices. They upped their prices significantly, which also benefited us. Both of the above factors converted a seemingly unattractive business proposition into a profitable and mutually beneficial partnership.
Several years later as we beamed with joy and happiness at achieving good profits on an annual sale of about 5 Million Pounds. I recalled the wise words of Varinder, "You can't win the game if you do not play the game."
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Ravi ji,
Your perspective is that of an activist, trying to reform our world. Whereas my perspective and approach is that of a philosopher and some say a mystic.
Naturally their is bound to be differences in our understanding, and approach.
People such as yourself are essential for the welfare of our society. I cannot disagree with your premise and your analysis. I compliment you on your efforts.
I am sorry Gurvinderji the answer is not only incomplete but also concludes with a wrong premise. The answer is incomplete because you have left out the judiciary and the wrong premise is that the people are not participating in the game and are being mere spectators.
Firstly here are the conclusions I had come to more than 10 years back after experiencing, observing and studying governance from adequately close quarters:
Law makers without any prescribed qualities, qualifications or experience, their men Fridays (popularly known as bureaucrats, who are required to help them in decision making by collecting and collating data and maintaining records) without any accountability and a judiciary which has the scope for the most whimsical decision makin…
Ravi ji, This is an interesting question and I will try to cover it in a future article, but here is my response to the question.
Politics is the only profession that requires no education, nor skill, nor experience. It is the fastest way to gain power not necessarily for personal gain. They reflect the will of the majority of the people. Since they have the mandate, they do not generally feel the need to listen to the people once they are in office.
The government is actually the bureaucracy which exists for its own power often taking precedence over serving the people. They are immune to what the people want or desire. They will do what they think is…
Interesting reading. True that you have to play the game to win it. But how about playing a game where one party keeps changing the rules after the game has begun. For example the game between the citizens of India demanding honest and efficient service from the government and the people in government playing to cheat and swindle them?