E – Summit 2010, IIT Bombay – Our Bitter Sweet Experience!

We (Ambuj, Amol), the E – cell leaders of Acharya School of Management attended the E –summit 2010, held at IIT Bombay on the 7^th of February 2010.

Our bus to Mumbai was scheduled on 5^th of February at 10.30 pm. Though we reached the pickup point on time, the bus was late by half an hour (Indian Standard Time!). We boarded the bus at 11.05 pm. It was a semi sleeper bus, comfortable with good leg space, a requisite for a long journey. The driver informed us that it would take at least 18 hours to reach Mumbai, which is quite a long journey in a bus!

We reached Mumbai on the 6^th of February at 9.30 pm. We were completely exhausted by the end of journey. We got down at Vashi, and took a rickshaw to IIT. We reached there by 10 pm and reported to the security upon arrival. They took the necessary details and informed us to head to the hostels in order to complete the registration process. Mr. Rishikesh the person responsible for accommodation informed us that, the college would not provide accommodation to visitors. This came as a shock to us as the same person had told that we would be given accommodation when we spoke to him over the phone before deciding on the trip to the summit.

The security informed us that there is no good place to stay near the college campus and that we will have to head to Ghatkopar, the nearest place where we could find accommodation. We spent our night at Ganesh Palace, a hotel at Ghatkopar.

The next day we reached IIT at 10 am. We reported to the security and he asked us to head to SOM (School of Management). Our names were missing from the registration list, though we had registered online much earlier. We had the necessary print out of the confirmation mail that is sent once we complete the registration. These documents helped them in cross verification and from then on the registration process went on smoothly.

After the registration was done they asked us to head to the Lecture Hall where the Opening Panel Discussion was going on. The panelists were Mr. Ashank Desai (Founder & CEO Mastek), Mr. A K Purwal(Ex- Chairman, SBI), Mr. Raj Nair (Head, Avalon Consulting). The discussion was about “Exploring New Opportunities – Emerging India”. Each of the panelists discussed in-depth about the various opportunities and challenges of Emerging India. Mr. Desai discussed how we could always find a niche in the software industry, no matter how crowded the market is. He was quite disappointed with the Angel networks’ in India. He also talked about the importance of having a mentor in whatever you do, in order to increase the chances of your success. He stressed the importance of showing that your business is conducted in the right way. This would make the customer more attracted to you. Mr. Purwal discussed more about the banking Industry and the various opportunities in the industry. He was proud to say that the Indian Finance person, as he put it is considered to be the best in the world. He said that, around 50% - 60% of the people in Wall Street are Indian. This statement was followed up by a huge applaud from the audience. Though the panelists had discussed thoroughly on the topic, the questions from the audience, who were mostly the students of IIT was quite out of context. They were interested to know how the software industry is doing and its future prospects, the effect of recession to this industry etc., not a single question was asked about entrepreneurship and there were silly questions like, “How do I know what my passion is?” This question was answered by Mr. Nair, who said “What do you feel when you see beautiful girl!” A silly answer to an equally silly question!

The panel discussion was followed by lunch break. “Networking Lunch”, that’s what they called it, though the name for the lunch break sounded well, there was absolutely no networking done throughout the break. There was a long queue for lunch and they were so involved in the variety of dishes that was served and by the time lunch was over, it was time for us to get back to the summit.

Post lunch session was “Innovation Redefined” a series of insightful single speaker sessions addressed by Mr. Dheeraj Gupta (Jumbo King Vada Pav) and Mr. Kranthi Kiran Vistakula (Dhama Apparels). This was the only session which thoroughly discussed about Entrepreneurship. They shared with us all the hurdles that they faced during their journey in becoming successful.

The next session was a panel discussion about “Opportunity cost”. The panel members were Mr. Allwin Agnel (Founder and CEO, PagalGuy), Ms. Nirmala (ex- country head of MTV India) & Mr. Ajit (Founder and CEO, Megaware Technologies). They discussed about the various skills that an entrepreneur must have. They discussed all about entrepreneurship but nothing about the topic at hand.

On the whole, though the program had such esteemed panel and other people from the industry, we felt that the event was un-organized. We could see a lot of attendees running about, searching for the place where the event was happening. There were no directions or coordinators to attend to. People were dazed and confused!

The schedule of the event was till 8 pm. But, we had to leave the place early as our bus was scheduled at 9.30 pm from Chembur. We reached Bangalore at 6.30 pm on the 8^th of February.

We had high hopes from this event. We thought that this event could provide us with insights on how to conduct a big event. But, we were disappointed with the overall event and have come to realize that “All that glitters is not gold”.

Role of Government in bringing about a social change - Education

Role of Government in bringing about a social change – Right to Education, a landmark act!

An alteration in the basic structures of a social group or society is called as social change. Education, I believe is one of the most dominant factors that would bring about a social change. Education leads to consciousness which plays an important role in social change. Keeping this in mind the Government of India (GOI) passed the Right to Education Act, free and compulsory education for all children from the age of six to fourteen, on 1st of April, 2010. It is now a fundamental right! This can arguably be one of the landmark acts that have been passed by the GOI in order to make the people of India educated and hence provide a way to eradicate poverty, which has been one of the main agenda of all the parties in power since the independence.

At the time of independence, India’s primary education was characterized by historical inequities. Though Article 45 of the Directive Principles of state policy was committed to ensuring free and compulsory education for all, this did not translate into action and school enrollments and participation remained low for decades after Independence. GOI did not give up; it brought in more such initiatives like the Shiksha Karmi Project (1987), District Primary Education Programme (1994), Sarva Siksha Abhiyan (2001) and few more. These initiatives have been proved to be effective. Primary education has made remarkable progress, as is evident from the provision of schooling facilities. There is statistics that nearly 83% of the villages have a primary school within a distance of one kilometer. There is also considerable increase in the school enrolment in almost all the states of India. But still India lags well beyond most of the other developing countries, why?

The primary reason for this is the Socio-economic conditions in rural India. It has constrained the process of primary education and the social inequalities of caste, class and gender have been identified as the major causes of educational deprivation among the children in India. A large proportion of children from the economically poor and socially disadvantaged groups and girls, especially in rural areas, are either denied access or are failing to complete even five years of basic education. The goal of universal education remains a challenge to achieve even after six decades of independence.

There are also several other reasons why children do not attend school in rural India. One of the main reasons is the economic role of children in the rural family. The economic participation of children in the rural Indian family has been a part of the ancient Indian culture and tradition. Agriculturists are the main portion of the population in rural India. Children of a farmer are given specific tasks such as keeping a watch on crops, older children helped out in looking after younger siblings. The other portion of the population is artisans and craftsman. Children of artisans and craftsmen learnt the skill of craft through training imparted by family members. Children are entrusted with work that was time consuming and it kept them occupied, allowing elders to pursue heavier labour and complex skills.

Stressing the importance of the Act, Prime Minister Manmohan Singh said, “the health, education and creative abilities of our children and young people will determine the well being and strength of our nation. Education is the key to progress. It empowers the individual. It enables a nation”. The PM also referred to the need for all stakeholders to work in unison to realize the Right to Education, describing it as a “common national endeavour” - Source, ET, 2nd of April edition.

This act will propel India to even greater heights of prosperity and productivity by guaranteeing children their right to a quality education and a bright future. If all the people involved in implementation of this Act do their jobs with honesty and dedication, I believe we will be a super power and remain a super power in the long run!

Tapping BOP

Tapping BOP, profit or loss?

The Bottom of Pyramid (BOP) proposition says that, large companies can make a fortune by tapping the BOP i.e., poor people, by selling to them products and services that these large companies provide and simultaneously help eradicate poverty.

The BOP proposition according to C.K Prahalad can be summarized as follows,

• · There is much untapped purchasing power at the bottom of the pyramid. Large companies can make significant profits by selling to the poor.
• · By selling to the poor, these companies can bring prosperity to the poor, and thus can help eradicate poverty.
• · Large MNC’s should play the leading role in this process of selling to the poor.

Thus, Prahalad argues that selling to the poor can simultaneously be profitable and eradicate poverty.

According to the latest statistics by World Bank 2003 report, there are 2,733 million people who live on less than $2 a day. The total number of poor people in India is close to 300 million i.e., 27% of the overall population. Widespread poverty is an economic, social, political and moral problem. At this level of poverty, the basic needs of survival are met, that too just barely.

Prahalad also claims that the BOP potential market is $13 trillion at PPP. According to the data from World Bank, 2003, assuming that there are 2,733 poor people and also the average consumption of poor people is $1.25 day; this implies that a BOP market size is of $1.2 trillion at PPP. The claim made by Prahalad, I believe is way too romantic!

I feel that the market size of BOP is quite small. The costs involved in serving the markets at the bottom of pyramid can be very high. Poor people are classified as urban poor and rural poor. The concentration of urban poor is much denser as most of them live in slums. But, the concentration of rural poor is largely displaced geographically and is culturally heterogeneous. This dispersion of the rural poor increases distribution and marketing costs and makes it difficult to exploit the economies of scale. Transportation and communication infrastructure is still weak in India; this will increase the cost of doing business at the rural level. Small size of each transaction can also be a major factor resulting in higher costs.

Moreover, poor people are price sensitive and value-conscious consumers. Prahalad also assumes that, poor people often do spend on luxury goods. Given the $2 a day income, which would primarily be spent on food, clothing and other needs, I wonder how they would ever save to consume a luxury item.

To conclude, I believe that there lies less fortune at the bottom of the pyramid. The poor people find it difficult to make their ends meet day in and day out. The fortune from this market, according to me is much hyped. I do not deny the fact that there is market. There is definitely a market, but a modest one.