arbit – Page 57 – Pertinent Observations

Big Management and Big Picture

One common shortcoming that top management in a lot of companies is accused of is that they give too much attention to details (i.e. sometimes they micromanage), and they are unable to see the big picture.

For example, if you think about the financial crisis of 2007-08, people kept making stupid bets about the mortgage market because they didn’t look at mortgages in the overall context of economy. They looked at their models, made sure they “converged” to a zillion digits, the math was perfect, etc. And priced. And conveniently forgot some of the “big assumptions”.

I think this has to do with the typical promotion procedures in corporations, and an assumption that people who are good at one kind of stuff will continue to be good at other kinds of stuff.

For example, in the early part of your career, in order to move up the “corporate ladder”, it’s important to show your skills at being able to give attention to detail, to be able to see the “little picture”, be careful and precise, and so on. For these are the kind of skills that makes one successful in the lower-level jobs.

Now, my hypothesis is that being good at details and being good at seeing the big picture are at best orthogonal, and at worst negatively correlated. I base this hypothesis on some initial reading on stuff like Attention Deficit & Hyperactivity Disorder and related topics.

So, when you promote people based on their ability to be good at details (which is required at lower levels of the job), you will end up with a top and middle management full of people who are excellent at details, and whose ability in seeing the big picture is at best questionable. Explains well, right?

I don’t know what can be done to rectify this. Promotion is too important to take away as an incentive for good performance at junior levels. Some organizations do institute procedures where for higher promotions you also need to show skills that show your big picture skills. But these are only for people who have already reached middle management, which is people who are good at details, which means that a large part of those who started at the bottom, and who are “big picture people” would have already fallen at the wayside by then.

Does my hypothesis make sense? If it does, what do you think needs to be done to get big picture thinkers at the top?

College Admissions

Why does the government require colleges in India to have “objective criteria” for admissions? I understand that such criteria are necessary for government-owned or run or aided colleges where there’s scope for rent seeking. But why is it that “private” colleges are also forced to adopt “objective criteria” such as board exam marks or entrance test scores for admission?

Abroad, and here, too for MBA admissions, admission is more “subjective”. While of course this has the scope to introduce bias, and is a fairly random process (though I’d argue that the JEE is also a fairly random process), won’t it reduce pressure on the overall student population, and bring in more diversity into colleges?

As a natural experiment I want to see a few state governments deregulating the admissions process for private colleges, making it possible for the colleges to choose their students based on whatever criterion. So what would happen? Of course, some seats would be “reserved” for those with big moneybags. Some more would be reserved for people who are well connected with the college management. But would it be rational for the college boards to “reserve” all the seats this way?

Maybe some colleges would take a short-term view and try to thus “cash out”. The cleverer ones will realize that they need to build up a reputation. So while some seats will be thus “reserved”, others will be used to attract what the college thinks are “good students”. Some might define “good students” to be those that got high marks in board exams. Others might pick students based on how far they can throw a cricket ball. The colleges have a wide variety of ways in which to make a name, and they’ll pick students accordingly.

The problem with such a measure is that there is a transient cost. A few batches of students might get screwed, since they wouldn’t have figured out the reputations of colleges (or maybe not – assuming colleges don’t change drastically from the way they are right now). But in a few years’ time, reputations of various sorts would have been built. Colleges would have figured out various business models. The willingness to pay of the collective population would ensure that reasonably priced “seats” are available.

And remember that I mentioned that a few states should implement this, with the others sticking to the current system of regulating admissions and fees and all such. In due course of time it’ll be known what works better. Rather, it’ll be known what the students prefer.

It’s crazy that colleges now require students to get “cent per cent” in their board exams as a prerequisite to admission. It’s crazy that hundreds of thousands of students all over India, every year, spend two years of their prime youth just preparing to get into a good college (nowadays the madness is spreading. A cousin-in-law is in 9th standard, and he’s already joined JEE coaching). On reflection, it’s crazy that I wasted all of my 12th standard simply mugging, for an exam that would admit me to a college that I knew little about. Madness, sheer madness.

The Bharadwajs

I’m married to a Bharadwaj. To put it another way, I’ve “bailed out” a Bharadwaj. Let me explain.

There is a concept of “gotras” among “Caste Hindus”. Each person is supposed to have a paternal ancestral line to a rishi, and that rishi’s name is your gotra. For example, I’m supposed to be a descendant of the sage Haritsa (such an obscure rishi he doesn’t even have a Wikipedia page). And so my gotra is “haritsa”. Knowledge of your own gotra is important when you go to a temple to get “archane” (where you pay 10 rupees, give some vital stats and get sugar candy in return) done. It is also important when you are going to get married.

So Hindus have a weird way of defining cousins, especially for the purpose of marriage. Only male ancestry matters, and male brotherhood also. If you examine this further, everyone who has the same gotra as you (and hence are related to you by a paternal line) are your cousins. Sisters and mothers don’t particularly matter in this definition of cousins, hence the widespread incest, especially in Karnataka and Andhra Pradesh. There is one important exception of course – your mother’s sister’s siblings are also your cousins, though no one bothers keeping track of such relationships over more than a generation.

Like in any other good religion, Hinduism doesn’t allow you to marry your cousins. And due to the weird definition of cousin, you effectively can’t marry someone from your gotra. That is supposed to be incestuous. If you have any doubts about this, please travel to Haryana and ask any of the khap panchayats there.

So among Brahmins (due to lack of sufficient data points, I’ll restrict my discourse to Brahmins), the most “popular” gotra is Bharadwaja. It is either the Rishi Bharadwaja himself, or some of his descendants, or all of them collectively, who did a “Genghiz Khan”. Rather, one should say that Genghiz Khan did a Rishi Bharadwaja. Because of this, Bharadwajas constitute a really large proportion of Brahmins. I’m not sure of exact statistics here, but they are easily the largest Brahmin Gotra.

So now, “rules” dictate that you should marry within your caste, but outside of your gotra. And this puts the Bharadwajas at a great disadvantage, for so many other Brahmins are Bharadwajas, that the sample space from which to look for a spouse is severely restricted indeed. I know of a cousin (mother’s father’s sister’s son’s daughter) who is a Bharadwaja, and who spent a really long time in the arranged marriage market. As I told you, restricted sample space. That way, people like me who belong to obscure gotras should consider ourselves lucky, I guess.

So if you are a Brahmin, and not a Bharadwaja, please help out a needy fellow-Brahmin, who may otherwise have to spend a really long time in the marriage market (arranged or otherwise) only because one of their ancestors happened to be particularly prolific. And this is one thing in which I can proudly claim to lead by example.

PS: The proportion of Bharadwajs among Brahmins might be overstated due to the sheer number of them who put the name of their Gotra as their surname. I don’t think putting gotra as surname is common among any other Brahmin gotra.

Working Hours at Work

There are some people in my office (and in every other office that exists) who believe in “face-time”. That they need to be present for a certain number of hours every day at work irrespective of whether there is work to do or not. I find this wasteful, and distasteful. I don’t see why I need to spend time in office if I don’t have any work to do, and I consider time spent in office when I’m not working to be a positive waste of time.

Yes, there are times when I do get sucked in to this face-time crap, and just sit on in office when I don’t have anything to do (either there’s nothing to do, or I’m in such a bad state of mind that I’m unproductive). Sometimes, it does make sense simply for the option value – when you’re sitting there, there’s a chance something might strike you and take you past the mental jam you’re currently caught in. But most of the time, this option is worthless.

So recently I was trying to do an analysis of how I spend time at work, and if I get rid of the unproductive stuff (like random chats with colleagues, random reading, etc.) I can divide my time at work into two important components – times when I’m actually doing work, and times when I’m simply waiting to talk to someone, for their inputs, or comments, or whatever else. And when I did further analysis, I realize that the latter took up more time than the former.

Teamwork, integrated teams, helping each other, regular feedback, all these are important. But at the cost of spending several hours in office without actually doing any work? When you could’ve spent that time at home, doing what you really like to do. Especially when you have been given a Blackberry and so can read the inputs at any point of time? And when you have a mobile phone, and have the luxury of being able to log in to work from home..

Of course, the other side of this is that if you bring your work home, the fine line between work and home disappears. You are now always on call, have to be constantly checking your Blackberry. You think twice about leaving home, and the blackberry and the mobile phone, and going off somewhere. It doesn’t make you feel all that good..

Wondering how I can balance this all out. And spend as little time as I need to in office, while still doing the amount of work that I’m expected to do. I guess I simply need to get practical about this and stop bothering about what other people think about my hours, and all such. As long as I do the work.

Last Thursday, working in one long burst, I finished the work I’d set myself for the day and dashed off an email by 4pm. And then realized that it would be at least another 2-3 hours before I could get a response. And so packed off home, since I had some work there (true to expectations, the replies came in after 7pm). I felt good about leaving office when I knew I wasn’t going to be productive. But then there was this strange guilt that the system puts on you for doing like you please, without regard to the system.

Anyways, I need to be more practical about all this, and screw signaling. And to turn around an old Hutch ad, which says “Blackberry from Hutch, to keep daddy away from office”. I say “Blackberry from Hutch, to keep daddy at work even when he’s away from office”.

Photo Essays

Over the last 2-3 weeks I’ve been uploading photos on to Facebook from my recent trip to Italy and Greece. I’ve been doing it in bits and parts since I wouldn’t want to flood my facebook watchers with too many pics at a time. So I’ve been uploading them by city.

Looking at the photos I’ve uploaded, I realize I’ve given fairly lengthy captions to most of them. There are a few photos which don’t have any descriptions, but they are a minority.

I realize I’m a writer first, and the photos I take are there only to enhance the story. I don’t think I’m ever capable of replacing a thousand words with a picture. I might put a picture in their place, and still write five hundred words.

And I keep this in mind every time I take a picture, I realize. I think about what story I can build AROUND the photo that I’m taking. It’s never about the story that the photo itself will tell. Perhaps this means I’ll never improve that much in my photography..

Mutter Paneer for Breakfast!!

So when our newly-recruited cook told us last week that she knows how to cook North Indian dishes, and when we bought Paneer and Frozen Peas at the supermarket yesterday, I assumed that we’ll be having Mutter Paneer for dinner tonight. The cook comes in around 6am, a little after I leave for the gym, so it’s usually the wife’s responsibility to tell her what to make.

And so I return from the gym and find out to my horror that we’re going to have Mutter Paneer for breakfast instead! I mean, who has mutter paneer for breakfast? Or even, who has chapati for breakfast? Isn’t it a dinner item? Well, that’s been one of the longest standing disputes the wife and I have had ever since we started living together.

She comes from a family of rice-eaters (she’s technically Gult, I’ve told you right?), without anyone in her immediate ancestry suffering from any lifestyle disease (heart/diabetes/cholestrol/etc.). And so, they’ve been used to having rice for meals. Rice for lunch, and rice for dinner. And occasionally chapati for breakfast.

I remember this being the case in my family, too, when I was a small kid, but things changed sometime in the 90s. My parents were both plump by then, and for a variety of other reasons, we switched to having oil-free chapatis (phulkas) for dinner. And now that chapati had become a dinner item, it automatically stopped being a breakfast item, and so for breakfast we restricted ourselves to the “traditional stuff” like dosa, akki rotti, uppit, avalakki, etc. (I hate homemade idlis so that was never a part of the menu). And for dinner, apart from chapati, we also started having ragi mudde (ragi balls, made world famous all over India by former PM HD Deve Gowda).

And so the battle begins. She, who has grown up always eating chapati for breakfast, and never for dinner. And I, having been looking at chapati as solely a dinner item for the last twenty years. Ok, chapati and onion-potato palya for breakfast is acceptable. But Mutter Paneer for breakfast? You gotta be kidding me!

Anyways, the Mutter Paneer was good, and I did need a high-calorie meal after the gym session, so this cribbing here is more for the sake of cribbing rather than a genuine crib. Also, it is possible that it’s healthier to reserve the high-density food for breakfast, and have something light for dinner (I admit mutter paneer for dinner isn’t that good for health). But mutter paneer for breakfast and then rasam rice for dinner?

I’m sorry but I’m not a big fan of rasam. I find it too low-density and not filling enough. And in order to fill myself I need to eat a lot of rice, and eating a lot of rice at night makes me sometimes feel gross as soon as I get up the next morning.

Ok I’ll stop cribbing now. And I guess I’m a CHoM.

Charades of obscurity

Having “played” dumb-charades (DC for short) competitively at a school and college level, I don’t particularly enjoy playing it casually. I’m prone to getting annoyed when people around me (either on a picnic, or a party) exclaim with great enthusiasm that we should play DC. Till recently I used to think it was like chess – where my enthusiasm for the game has been killed purely because I played it competitively, but now I realize there are more reasons.

The challenge with “competitive” DC is that it is a timed game. You are judged based on how fast you can act out a certain name/place/animal/thing/. Because of this the clues need not be too hard, and there is a fair degree of challenge in acting out even simple things. Apart from this, the clues are set by a neutral third party which means they can all be trusted to be of approximately similar standard, so there is some sort of a level playing field there. Then, you have teams that have practiced well together, and have clues for all the trivial stuff, and you have a game!

With casual DC, there are several problems. Firstly, the games are not timed. Secondly, the teams haven’t practiced together at all, so it takes ages to communicate even straightforward stuff (which is why the games aren’t timed). And then the clues are usually given to you by your competitor. And for some reason, casual DC always has to be movies. No books, no places, no animals, no personalities, nothing.

The f act that the games are not timed, combined with the fact that the clues are given by the competitor, means that the game usually gets into a downward spiral of obscurity. You don’t want your competitor to guess the movie easily, so you give a vague movie. And they reply with something vaguer. And so forth, until teams have to check IMDB to find out if the movies actually exist. By which time all the enthusiasm for the game is lost.

On a recent trip (with colleagues, as part of our CSR initiative. more on that in another post) we played casual DC, and after some 10 clues it had gotten so obscure that nothing was guessable. I’d lost interest when someone suggested we do Kannada movies! Now, that’s something few people would’ve played – DC with Kannada movies as clues, because of which we could give clues while not keeping them too obscure (but it was hard. I completely bulbed trying to act out “Kalasipalya”).

Still, my hatred for casual DC remains, and I try as much as possible to not play it. Maybe next time I’ll impose conditions (like timing, choice of subjects, etc.), and refuse to play if they want to do English movies with infinite time.

Issuing in stages

I apologise for this morning’s post on IPOs. It was one of those posts I’d thought up in my head a long time ago, and got down to writing only today, because of which I wasn’t able to get the flow in writing.

So after I’d written that, I started thinking – so if IPO managers turn out to be devious/incompetent, like LinkedIn’s bankers have, how can a company really trust them to raise the amount of money they want? What is the guarantee that the banker will price the company at the appropriate price?

One way of doing that is to get the views of a larger section of people before the IPO price is set. How would you achieve that? By having a little IPO. Let me explain.

You want to raise money for expansion, or whatever, but you don’t need all the money now. However, you are also concerned about dilution of your stake, so would like to price the IPO appropriately. So why don’t you take advantage of the fact that you don’t need all the money now, and do it in stages?

You do a small IPO up front, with the sole purpose of getting listed on the country’s big exchanges. After that the discovery of the value of your company will fall into the hands of a larger set of people – all the stock market participants. And now that the market’s willingness to pay is established, you can do a follow on offer in due course of time, and raise the money you want.

However, I don’t know any company that has followed this route, so I don’t know if there’s any flaw with this plan. I know that if you do a small IPO you can’t get the big bankers to carry you, but knowing that some big bankers don’t really take care of you (for whatever reason) it’s not unreasonable to ditch them and go with smaller guys.

What do you think of this plan?

Sai Baba and his tricks

Back when I was a kid, an annual “excursion” was to the Sai Baba’s ashram in Whitefield, near Bangalore (ok, back then it was “near Bangalore”. Now people claim it’s part of Bangalore). This would usually be in summer, when the Baba would descend on his “summer home” in whitefield. There would be lots of people there, with a large proportion of them being Caucasian. To other “devotees” of the baba (as they like to call themselves), the presence of fair-skinned people among the followers was proof enough that the Baba was not “fake”.

We had to queue up, get frisked, and sit down cross-legged for a while, before the Baba decided to bless us by appearing in front of us. He would wave, produce caramilk chocolates (I think from his sleeve, while my aunt claimed it was from thin air) and throw them to the crowd, which would go into a frenzy trying to catch this “Prasad”. My eldest aunt was especially adept at catching these chocolates and giving them to us kids. I remember my father never came in. He spent the time peoplewatching outside the ashram. He said he enjoyed that better.

One of my greatest fantasies when I was a kid was to expose the Baba. Somehow plan with a bunch of friends, and catch him in the act trying to pull caramilk toffees out of his sleeve. And then shoot the video and escape, well at a faster rate. I remember putting myself to sleep on several days thinking about a plan like this. Unfortunately I never really got to implement that. Thinking back, I don’t think I’d ever planned in any of these daydreams about how I’d get past all the security and the hangers-on to reach the Baba and expose him.

It seems I was not alone in these dreams. Several others thought of this too, and did more than what I wanted to do. Check out this video (HT: Amit Varma). It relies on publicly broadcast footage to show that the Baba is likely to be a fraud.

Of course his “devotees” would deny this. After all, they stand to lose any power and credibility they have in the “organization” if they were to come out. A few devotees who have dared to come out against the Baba (mostly on charges of paedophilia) have found themselves ostracized and hounded by the pro-Baba community. Once “in”, it’s never made sense for any of the “devotees” to turn against the Baba. Until now.

Following the Baba’s demise last week, commentators are predicting a succession war among people who are close to him. And therein lies the great hope. That one or more of the parties involved in his succession battle is going to spill the beans. So far it made eminent sense for all these worthies to defend the Baba at any cost, for they drew their (not inconsiderable) power by being in the good books of the Baba, and more power to the Baba meant more power to them. Now that the Baba is no more, the losers in the succession battle are likely to have anyway lost all their power. And now they have little to lose, and the adulation of the world-at-large to gain, if they were to expose the Baba. And if they were to admit that the Baba’s “miracles” were nothing but a bunch of simple magic tricks, they would also succeed in cutting to size the people who would win the Baba succession battle.

As Tony Greig would say, it’s all happening out there.

Inventory

You know inventory represents a huge cost when online retailers such as Flipkart which don’t have to invest in keeping inventory at storefronts in expensive malls and high streets offer massive discounts, of the tune of 30 to 40% at times.

You know that inventory represents a huge cost, and shop space is precious, when you go shopping in summer trying to find a nice sweater and find that no half-decent store is even selling sweaters!

Oh, and I think you can judge the standard of a clothing retailer by the quality of their trial rooms.