LONG LIVE THE KING!
A 2-Pager by Ajit Chaudhuri: August 2007
Regime changes are rarely pleasant – ask the Iraqis and Afghans. This applies in organisations as well – a change of Big Boss has consequences for those down the line. Especially so for those directly reporting to her/him, but please do not feel that you will be spared the reverberations by virtue of being lower down the organisational food chain. Your career will now depend upon the views of a person you may not know, and your history of success and failures may not count for much. Stories of what happens to executive teams during CEO transitions are not comforting – firings, cancelled strategies, organisational reshuffles, and abrupt and unwelcome career changes for senior managers.
So if you are not working for an African dictatorship or a local NGO, chances are that you will have to survive a regime change or two in the course of your career. At these times, you will be faced with three questions – how worried should I be, what will happen to me if I get pushed out, and how do I maximise my chances of prospering under the new Big Boss. A recent article in the HBR entitled “Surviving Your New CEO” [1] has some answers pertaining to managers in large firms in the US. Despite difficulties in translating the implications to the Indian scenario, there are some interesting pointers to those of us who are facing, will face, or have faced a regime change. Please read on!
How worried should you be? Very worried! A typical firm has a 16 percent turnover of managers every year, of which 8.5 percent is voluntary (retirement, or health/family issues) and 7.5 percent is involuntary (including firings and unplanned early retirements). When a new CEO is in place and has been promoted internally, involuntary turnover increases to 12.5 percent and combined turnover is about 1 in 5. When a new CEO has been brought in from outside, involuntary turnover increases to 24 percent in mid and 31 percent in poor performing firms. To put it bluntly, if you are a senior manager in a sub-par performing firm, you have a 40 percent chance of leaving if the CEO changes and a new one has been brought from outside.
What will happen if you get pushed out? Some people think that losing their job would be the best thing that could happen to them – they could get out of the rat race and do all those things they’ve been dying to do; spend more time with the kids, explore an alternative career, shift to the rural wilderness, write a book, whatever. Such transformations are rarely successful. Competent people also assume that, if they are asked to leave, they will find a better or at least equal job elsewhere – and they are relaxed about their fate under their new Big Boss. Beware! The data does not support this optimistic outlook. Only 4 percent of managers leaving due to a regime change get a better job, and another 28 percent experience lateral movement. Only 3 percent accept significantly worse jobs in similar-sized firms. 22 percent leave to join a much smaller firm or start a small business of their own, and 43 percent disappear from the source database altogether (a euphemism, I suspect, for ending their careers). Given these outcomes, sweetening up the new Big Boss is an advisable strategy.
How to prosper under a new CEO? New CEOs have certain characteristics. They are under tremendous pressure, as their own survival on the job is heavily dependent upon the firm’s performance in their first year. They therefore tend to make people decisions quickly, even when they have publicly vowed to take their time. They do not seek inputs from their predecessors, and place little weight on the inputs that they do receive – so do not expect your good relationship with the ex-Big Boss and the professional respect s/he accorded you to continue on momentum. They tend to rely on their instincts, and early impressions count significantly. And finally, they tend not to have restrictions from their Boards on changing management teams. Assuming no force majeure that makes your exit inevitable (you are a CFO and the new CEO brings his/her own CFO, for example), a good first impression is critical to your chances of survival and success.
The authors have interviewed successful CEOs and asked them to look back at the earliest days of their new jobs – what did executives do to turn negative impressions into positive ones? Did otherwise smart people do, or fail to do, something that brought about their downfall? Here is a summary of their recommendations.
1. Show your goodwill
a. It may be tempting to adopt a wait and see policy rather than taking the initiative to talk about your role and responsibilities with the new CEO, but many executives doomed themselves by failing to demonstrate eagerness and willingness to be part of the new team early.
b. It is dangerous to assume that your new CEO already understands that you want to cooperate. Those who oppose the new agenda do not announce their opposition, and new leaders do not equate silence with agreement.
c. If you plan to stay on, let the new CEO know proactively but without being sycophantic, and follow up with actions that demonstrate your willingness.
2. Leave your baggage at the door
a. Do not talk about salary issues, even if you were grossly mistreated by the previous regime. The new CEO does not want to deal with these as yet.
b. Do not talk about your own long term plans with the firm. The new CEO has not yet decided whether you still have a career here.
c. Do not raise issues of difficulties you are having with your colleagues.
d. Get your spouse to be diplomatic – anything s/he says will filter back and be construed as a reflection of your real views.
3. Study the new CEO’s working style – how approachable and participatory s/he is in functioning, how comfortable s/he is with dissent, how rigid s/he is on ethical or behavioural matters, etc. Opinions are divided on whether you should contact your counterparts in the new CEO’s former division or firm to enquire into these matters.
4. Understand the new CEO’s agenda. S/he is under tremendous pressure to perform. 75 percent of new CEOs whose stock performance rose in their first year of tenure were still in place two years later, and 83 percent whose stock fell were gone by that time. S/he will be looking for constructive suggestions and realistic and honest game plans. Offer objective options and explanations, and do not come across as self-serving.
5. Be on your ‘A’ game
a. Show positive results, and soon! You cannot afford to let things slip into paralysis because of confusion caused by the regime change. It is critical to demonstrate that you are active and competent.
b. Show political awareness during the ‘honeymoon weeks’. Do not assume that you are invaluable – be available to the new Big Boss, and cancel that long-planned vacation if it coincides with his/her joining. S/he will not have the time to coach you or even to warn you that you are going wrong.
To conclude: Regime changes are stressful for everyone. The danger of being pushed out is real, and the difficulty of landing on your feet is severe. However, opportunities to invigorate your career are real too; others find fulfilment away from the professional world. You need to make your own decision as to whether the new Big Boss’s style, vision and business practices are ones you want to live with. Then commit or get out! Otherwise, everyone’s life will be hell – and the result will be the same anyway.
Acronyms:
CEO Chief Executive Officer
HBR Harvard Business Review
NGO Non-Governmental Organisation
[1] “Surviving Your New CEO”, Kevin and Edward Coyne, HBR of May 2007.
Thursday, August 9, 2007
Wednesday, July 18, 2007
Are Things Getting Better?
ARE THINGS GETTING BETTER?
by
Ajit Chaudhuri
Written in 1996 in response to a question posed to me by my Father
Published in Lokayan Journal (Bulletin 13, 1997)
I am constantly asked the question - are things in India getting better? The temptation would be to give a resounding yes in reply. After all, there are more cars on the roads, owned by a wider variety of people and looking increasingly (but not yet quite) what our role models in the west are driving. The shops have their shelves full, the variety available is far wider than, say, ten years back, and people are buying. Most homes have TVs, and the choice of what to watch is huge. The various indicators of progress such as GDP and Per Capita Income, when compared over time (though not with the figures for other countries) also point towards change for the better. Why, then, does one not feel completely comfortable with the answer.
To Indians of my generation and background, there are four pillars that have formed the India that we have lived and been brought up in. They are democracy, socialism, secularism and non-alignment *. It would be interesting to see how these have changed in the recent past, and how this change has affected the well-being of the vast majority of people in India.
Non alignment is dead. The less said about it the better. Suffice to say that it did not bother the ordinary person then, and the lack of it does not bother him/her now. Secularism is in the process of dying. People are dividing themselves into caste and communal lines, with a gradual erosion of the middle ground which is so necessary for one side to be able to talk to the other. The resultant social turmoil is taking place, along with a hardening of views and respectabilization (for want of a better word) of the likes of Thakeray and Singhal. This says a lot for the manner in which things have changed.
Democracy - it is without doubt still vibrant. Most people, of all castes, creeds and educational backgrounds, believe in it. Major changes, however, have taken place in India’s democratic process, most noticeable being the need for money and muscle to fight elections. And while money is available from several places, there is only one source for muscle - criminals. Criminalization of politics has led to a deterioration in the quality of politicians, who today have questionable antecedents and motives. It can safely be said that a majority of those sitting in the country’s parliament and legislative assemblies should actually be sitting in the country’s jails. And these are the people to whom have been entrusted the right to represent the people and decide the course of India’s future.
Socialism - this has been demolished over the course of the recent past in a systematic manner under the auspices of the New Economic Policy and the Structural Adjustment Programme. The NEP and the SAP were formulated by economists in the government and IMF/World Bank at a time when India was going through a budgetary crisis, its aims were to boost industrial production and exports, control trade deficits and revitalize the economy. The measures adopted were trade liberalization, devaluation, privatization and cutbacks in government expenditure.
A word about IMF advocated structural adjustment programmes in general - they are known not to succeed because the underlying philosophy behind them is that the rich are not rich enough and the poor are too rich and because the austerity measures are too harsh for too long to too many. In India the cutbacks have taken place in health and education and have come in tandem with privatization. The constitution still maintains that it is the government’s responsibility to provide basic health and education services to citizens, and the government still mouths this, but the fact is that while Apollo hospitals are coming up with top quality facilities for those who can pay, the majority of us have to go to understaffed, ill equipped Primary Health Centers where the quality of care, if available at all, is pathetic and rapidly deteriorating.
This has two inherent dangers. Firstly, people will naturally enquire as to why two percent of the country’s population should have these facilities while they go without (and this is already under way), and once this achieves a critical mass it is likely to boomerang into a movement. This may take a political form, leading to a change towards more equitable distribution of the resources and facilities available in the country through law and policy making institutions in India. On the other hand, given the poor quality of politicians and their inability to represent people, it is likely that such a movement will form outside of the political system leading to large scale social turmoil, increased crime, or terrorism. Some parts of the country have preceded others along these lines and the results are there for all to see.
The second danger is as serious - withdrawal of government responsibilities in an area such as health and privatization of the health care system would lead to a concentration on curative facilities and less attention to prevention, such as public health, immunization, etc. TB, the single largest killer in India and one which fifty percent of Indians are carriers to, costs approximately Rs. 6,000/- to cure in medicine alone. Can a country where forty percent of the population earn at levels below the minimum needed for survival afford a private health care system? And can a private health care system deal with malaria or TB in epidemic proportions? If the trend of a deteriorating government health system continues, we are all (and I mean all) likely to see a resurgence of such diseases in the country.
The accent on privatization has changed social systems within the country. While earlier there were strong community norms governing most activities, this has gradually broken down in favour of individualism. This has its good points - people are able to rise beyond the restrictions of caste, creed and community. The shit cleaner’s son can become a collector (though not yet vice-versa). It also has its negative ones - it is the powerful, the rich and the educated who are able to grab the benefits on offer, with nothing for those left out. An example at the family level is the breaking down of the joint family system. This leaves no mechanism for the care of the aged, widows, disabled and orphans. The conversion of common lands in villages into private property is another case in point - the poor are much more dependant upon common lands for their household fodder, fuel and water requirements, and these lands are getting less and less because of land grabs by the powerful (or the giving of these lands to institutions/industry by the government). Strong community norms acted as a restraint upon crimes and a judicial mechanism in case of disputes. Reduction of these norms has led to the need for people to turn to police and courts, both of which (as they are also ‘privatized’) are beyond the reach of the poor and the weak.
Have incomes really risen under NEP and SAP? Do people have better purchasing power than they had? Undoubtedly some people have gained. But what about others? What about small and marginal farmers, who are not able to derive the benefits of the country’s massive investments in irrigation and subsidized power and fertilizers, and are gradually selling their lands to large farmers, thereby becoming wage labourers without any assets of their own. What about traditional artisans and craftsmen, weavers and entertainers, whose markets have been eroded and who do not have the skills to change occupations. What about tribals, whose forest habitat, upon which they have traditionally been dependant for survival, is being destroyed in the name of development. What about migrant cattle herders, for whom common grazing pastures are being encroached upon by large farmers. What about unskilled labourers, who have migrated into urban areas and stay in shanty towns without basic sanitation, living on the wrong side of the laws of supply and demand. Have they gained in the recent past? Absolutely not. And are they some small minority who can be ignored in the name of general progress? No, they are only over eighty percent of India’s population.
Increased levels of awareness (different from education) undoubtedly exist, thanks to the spread of media. Aspirations have changed. But the means to realize these aspirations are still closed to those without education or capital, except in the areas of sports, films and crime. And entry level barriers are high in the former two.
To conclude! Change is a fact of life. Some gain more, some gain less, and some do not gain at all. It is beyond the purview of this paper to suggest remedies for the problems cited above. But it is necessary for some emphasis on the part of the government towards enabling people to withstand change, or to use change to their advantage. And this is not served by it ducking its responsibilities on the fronts of health and education. Or encouraging differentials in society through policies decided behind closed doors by people whose credentials are debatable.
* An article by Prof. T.K Ray in the India Today of May 15, 1996
by
Ajit Chaudhuri
Written in 1996 in response to a question posed to me by my Father
Published in Lokayan Journal (Bulletin 13, 1997)
I am constantly asked the question - are things in India getting better? The temptation would be to give a resounding yes in reply. After all, there are more cars on the roads, owned by a wider variety of people and looking increasingly (but not yet quite) what our role models in the west are driving. The shops have their shelves full, the variety available is far wider than, say, ten years back, and people are buying. Most homes have TVs, and the choice of what to watch is huge. The various indicators of progress such as GDP and Per Capita Income, when compared over time (though not with the figures for other countries) also point towards change for the better. Why, then, does one not feel completely comfortable with the answer.
To Indians of my generation and background, there are four pillars that have formed the India that we have lived and been brought up in. They are democracy, socialism, secularism and non-alignment *. It would be interesting to see how these have changed in the recent past, and how this change has affected the well-being of the vast majority of people in India.
Non alignment is dead. The less said about it the better. Suffice to say that it did not bother the ordinary person then, and the lack of it does not bother him/her now. Secularism is in the process of dying. People are dividing themselves into caste and communal lines, with a gradual erosion of the middle ground which is so necessary for one side to be able to talk to the other. The resultant social turmoil is taking place, along with a hardening of views and respectabilization (for want of a better word) of the likes of Thakeray and Singhal. This says a lot for the manner in which things have changed.
Democracy - it is without doubt still vibrant. Most people, of all castes, creeds and educational backgrounds, believe in it. Major changes, however, have taken place in India’s democratic process, most noticeable being the need for money and muscle to fight elections. And while money is available from several places, there is only one source for muscle - criminals. Criminalization of politics has led to a deterioration in the quality of politicians, who today have questionable antecedents and motives. It can safely be said that a majority of those sitting in the country’s parliament and legislative assemblies should actually be sitting in the country’s jails. And these are the people to whom have been entrusted the right to represent the people and decide the course of India’s future.
Socialism - this has been demolished over the course of the recent past in a systematic manner under the auspices of the New Economic Policy and the Structural Adjustment Programme. The NEP and the SAP were formulated by economists in the government and IMF/World Bank at a time when India was going through a budgetary crisis, its aims were to boost industrial production and exports, control trade deficits and revitalize the economy. The measures adopted were trade liberalization, devaluation, privatization and cutbacks in government expenditure.
A word about IMF advocated structural adjustment programmes in general - they are known not to succeed because the underlying philosophy behind them is that the rich are not rich enough and the poor are too rich and because the austerity measures are too harsh for too long to too many. In India the cutbacks have taken place in health and education and have come in tandem with privatization. The constitution still maintains that it is the government’s responsibility to provide basic health and education services to citizens, and the government still mouths this, but the fact is that while Apollo hospitals are coming up with top quality facilities for those who can pay, the majority of us have to go to understaffed, ill equipped Primary Health Centers where the quality of care, if available at all, is pathetic and rapidly deteriorating.
This has two inherent dangers. Firstly, people will naturally enquire as to why two percent of the country’s population should have these facilities while they go without (and this is already under way), and once this achieves a critical mass it is likely to boomerang into a movement. This may take a political form, leading to a change towards more equitable distribution of the resources and facilities available in the country through law and policy making institutions in India. On the other hand, given the poor quality of politicians and their inability to represent people, it is likely that such a movement will form outside of the political system leading to large scale social turmoil, increased crime, or terrorism. Some parts of the country have preceded others along these lines and the results are there for all to see.
The second danger is as serious - withdrawal of government responsibilities in an area such as health and privatization of the health care system would lead to a concentration on curative facilities and less attention to prevention, such as public health, immunization, etc. TB, the single largest killer in India and one which fifty percent of Indians are carriers to, costs approximately Rs. 6,000/- to cure in medicine alone. Can a country where forty percent of the population earn at levels below the minimum needed for survival afford a private health care system? And can a private health care system deal with malaria or TB in epidemic proportions? If the trend of a deteriorating government health system continues, we are all (and I mean all) likely to see a resurgence of such diseases in the country.
The accent on privatization has changed social systems within the country. While earlier there were strong community norms governing most activities, this has gradually broken down in favour of individualism. This has its good points - people are able to rise beyond the restrictions of caste, creed and community. The shit cleaner’s son can become a collector (though not yet vice-versa). It also has its negative ones - it is the powerful, the rich and the educated who are able to grab the benefits on offer, with nothing for those left out. An example at the family level is the breaking down of the joint family system. This leaves no mechanism for the care of the aged, widows, disabled and orphans. The conversion of common lands in villages into private property is another case in point - the poor are much more dependant upon common lands for their household fodder, fuel and water requirements, and these lands are getting less and less because of land grabs by the powerful (or the giving of these lands to institutions/industry by the government). Strong community norms acted as a restraint upon crimes and a judicial mechanism in case of disputes. Reduction of these norms has led to the need for people to turn to police and courts, both of which (as they are also ‘privatized’) are beyond the reach of the poor and the weak.
Have incomes really risen under NEP and SAP? Do people have better purchasing power than they had? Undoubtedly some people have gained. But what about others? What about small and marginal farmers, who are not able to derive the benefits of the country’s massive investments in irrigation and subsidized power and fertilizers, and are gradually selling their lands to large farmers, thereby becoming wage labourers without any assets of their own. What about traditional artisans and craftsmen, weavers and entertainers, whose markets have been eroded and who do not have the skills to change occupations. What about tribals, whose forest habitat, upon which they have traditionally been dependant for survival, is being destroyed in the name of development. What about migrant cattle herders, for whom common grazing pastures are being encroached upon by large farmers. What about unskilled labourers, who have migrated into urban areas and stay in shanty towns without basic sanitation, living on the wrong side of the laws of supply and demand. Have they gained in the recent past? Absolutely not. And are they some small minority who can be ignored in the name of general progress? No, they are only over eighty percent of India’s population.
Increased levels of awareness (different from education) undoubtedly exist, thanks to the spread of media. Aspirations have changed. But the means to realize these aspirations are still closed to those without education or capital, except in the areas of sports, films and crime. And entry level barriers are high in the former two.
To conclude! Change is a fact of life. Some gain more, some gain less, and some do not gain at all. It is beyond the purview of this paper to suggest remedies for the problems cited above. But it is necessary for some emphasis on the part of the government towards enabling people to withstand change, or to use change to their advantage. And this is not served by it ducking its responsibilities on the fronts of health and education. Or encouraging differentials in society through policies decided behind closed doors by people whose credentials are debatable.
* An article by Prof. T.K Ray in the India Today of May 15, 1996
Saturday, June 30, 2007
A Neo Perspective
A NEO PERSPECTIVE
“A little knowledge is a dangerous thing, drink deep, or taste not the Pierian spring.”[1]
Economics, let’s face it, has a soporific effect on most of us – recent attempts by the likes of Thomas Friedman[2], Paul Krugman[3] and Steven Levitt[4] to sex up the subject notwithstanding. It is, however, difficult to avoid – we all deal with inflation, we face globalisation, and when revenues do not match expenditure we are in deep s***. It is equally difficult to get information that makes sense on economic issues – does, for example, growth matter more and lead to a trickle-down a la CII, or are the comrades right in demanding a focus on equity – and this results in debates that are high on rhetoric and low on substance, and viewpoints that invariably become a dominion of scoundrels.
Strong? Here are some scattered examples of this from my personal experience in the development sector.
A colleague of mine went on a tour of Europe about seven years ago with a group of Indian farmers – they were brought by national farmers’ associations of European countries to protest and demonstrate at some EU summit. I enquired further, and it was obvious that the policies they were brought to protest against were actually in the interests of Indian farmers, and that these guys were just pawns in a retrograde agenda.
A meeting on tsunami relief in Sri Lanka in 2005 degenerated into a harangue against neo-liberalism. What was neo-liberalism? I did not know, so I asked the others. Nobody in the meeting could tell me, but they did know that it was an official villain. What did they think of its direct opposite, neo-conservatism? The invariable answer – ‘Neo-what?’
Back in my days in Rajasthan in the early 1990s, many of my colleagues did not drink Coke or Pepsi. Why? They did not want to contribute to the profits of American companies. And they were sincere about this – it wasn’t a health campaign in disguise. The same colleagues were using Windows on their computers and had no objection to American aid contributing to the financial health of their respective institutions.
It was therefore illuminating to read an article on economic growth by Shankar Acharya[5] (SA) that, among other things, explained those much-reviled terms neo-liberalism and the Washington Consensus to the layman. SA begins with a short history of economic growth, and says that it is a recent phenomenon. Global GDP per capita did not change much between 1000 and 1800 AD, and increased by about 200 and 900 percent in the 19th and 20th centuries respectively. In 1820, income inequality was within countries – there was little difference in average incomes between countries. By 1950, there was massive disparity in average incomes across countries.
Growth per capita in advanced countries was steady (with exceptions during the world wars and a few busts and booms), and gains in living standards came from prolonged and sustained growth and not from occasional bursts of rapid growth. The growth experience of developing countries, however, has been varied, with the sustained growth over decades required to raise living standards being rare.
In the 1950s, development thinking favoured government-led import substituting industrialisation. It had its effects – in India, the Hindu growth rate of 3.5[6] percent per annum between 1950 and 1980 was much more than the 0.8 percent annual growth of the last 50 years of British rule. But, over time, problems arising from this approach mounted. These included –
· South Asian growth was plagued by foreign exchange scarcity.
· In Latin America, growth halted with a series of debt crises in the 1980s.
· East Asia, with outward looking foreign trade policies, enjoyed ‘miracle growth’.
· There were increasing incidences of government failure.
The resultant disillusionment led to the evolution of the Washington Consensus, which was driven by neo-liberals with the backing of the World Bank and the International Monetary Fund. Its tenements were stabilisation, deregulation, liberalisation and privatisation, and it drove ten policies down the throats of client nations. These were –
1. Fiscal discipline
2. Reordering public investment towards economic, health and education infrastructure
3. Tax reform
4. Financial liberalisation
5. Competitive exchange rates
6. Trade liberalisation
7. Liberalisation of foreign direct investment
8. Privatisation
9. Deregulation
10. Property rights
Cracks in the consensus appeared when it was obvious that countries that took the reforms in full had modest growth and those that did not, such as China and India, had high growth. A newer view accepts that the uniform prescription along ten fronts for everybody does not work. Property rights, rule of law, market-oriented incentives, sound money and sustainable public finances are desirable factors everywhere in driving growth, and the others (such as, for example, privatisation and liberalisation of trade and FDI) need to be adjusted for the specific circumstances of the country.
The article goes into other interesting matters, such as the relationship between growth, poverty, employment and equity and the importance of economic policies to spur and sustain economic growth. SA makes two important points –
· Rapid and sustained growth is the most effective way of reducing poverty – that, on average, growth of income among the poor is very similar to growth of mean income.
· There is substantial variation around this average. Economic growth can be more or less pro-poor, and the policy environment is a key determinant to this.
I am not going to dwell on these matters, and would like to return to the issue of neo-liberalism. As mentioned earlier, it is considered an official villain within NGO circles. Why exactly this is so is not clear to me – the various analyses that I have been subjected to appear to have been developed in some donor agency’s boardroom, possibly with Africa and Latin America in mind. Theories with a global perspective, as we all know (and, for us in foreign donor agencies, as we constantly and invariably unsuccessfully try to communicate to our masters) do not apply very well to the Indian situation. And many of us who profess a deep antipathy to neo-liberalism can be seen in actuality to be proponents of its principles, as the popularity of user-fees for NGO-provided development services (even though, in most cases, some donor is meeting the costs in full) and other widely practised neo-liberal tenements indicate. There is clearly a need for clarity on this matter – is neo-liberalism a good thing, a bad one, a necessary evil, what?
Why so? For one, because crumbling public services are a fact of life! Creating demand for services and pressure upon the state to undertake its constitutional responsibility and provide them a la the ‘rights mode’ approach has not resulted in improvement[7] – the Indian state is good at resisting pressure to perform. It is unlikely, in my lifetime, that I will see an acceptable quality of service in health and education for the poor, and that the taxes and cesses that we pay will aim to provide this rather than contribute to our politicians’, bureaucrats’ and contractors’ personal wealth. People looking to by-pass the state and set up parallel systems for today’s sick and today’s children have a point.
And yet, by creating parallel outlets for the demand, we contribute to a vicious circle of reduced pressure on public systems, poorer public services and governance, increased donor dependence, and zero options for those unable to pay. It is one thing to have toll taxes every 20 km.s on every road (as does Gujarat, where I write this) and quite another to have the most privatised health system in the world (which India does) when health expenditure is the single largest cause of households slipping below the poverty line.
I do not claim to have answers – I would merely like to see good information and an educated and non-partisan debate on these matters. In my lifetime? I certainly hope so!
Acronyms:
CII Confederation of Indian Industry
EPW Economic and Political Weekly
EU European Union
FDI Foreign Direct Investment
GDP Gross Domestic Product
[1] From “An Essay on Criticism” by Alexander Pope in 1709
[2] Famous for finding the world flat!
[3] Famous for being a one-handed economist – he is not constantly saying ‘on the other hand’.
[4] He achieved the impossible by writing a popular best seller about Economics, the book “Freakonomics”.
[5] “Economic Growth: Some Reflections” by Shankar Acharya in the EPW of 4th November 2006.
[6] Apparently the term’s origin is in the similarity of 3.5 to the symbol for ‘Om’.
[7] Anyone doubting this is welcome to look at DFID’s recent evaluation of its work in India.
“A little knowledge is a dangerous thing, drink deep, or taste not the Pierian spring.”[1]
Economics, let’s face it, has a soporific effect on most of us – recent attempts by the likes of Thomas Friedman[2], Paul Krugman[3] and Steven Levitt[4] to sex up the subject notwithstanding. It is, however, difficult to avoid – we all deal with inflation, we face globalisation, and when revenues do not match expenditure we are in deep s***. It is equally difficult to get information that makes sense on economic issues – does, for example, growth matter more and lead to a trickle-down a la CII, or are the comrades right in demanding a focus on equity – and this results in debates that are high on rhetoric and low on substance, and viewpoints that invariably become a dominion of scoundrels.
Strong? Here are some scattered examples of this from my personal experience in the development sector.
A colleague of mine went on a tour of Europe about seven years ago with a group of Indian farmers – they were brought by national farmers’ associations of European countries to protest and demonstrate at some EU summit. I enquired further, and it was obvious that the policies they were brought to protest against were actually in the interests of Indian farmers, and that these guys were just pawns in a retrograde agenda.
A meeting on tsunami relief in Sri Lanka in 2005 degenerated into a harangue against neo-liberalism. What was neo-liberalism? I did not know, so I asked the others. Nobody in the meeting could tell me, but they did know that it was an official villain. What did they think of its direct opposite, neo-conservatism? The invariable answer – ‘Neo-what?’
Back in my days in Rajasthan in the early 1990s, many of my colleagues did not drink Coke or Pepsi. Why? They did not want to contribute to the profits of American companies. And they were sincere about this – it wasn’t a health campaign in disguise. The same colleagues were using Windows on their computers and had no objection to American aid contributing to the financial health of their respective institutions.
It was therefore illuminating to read an article on economic growth by Shankar Acharya[5] (SA) that, among other things, explained those much-reviled terms neo-liberalism and the Washington Consensus to the layman. SA begins with a short history of economic growth, and says that it is a recent phenomenon. Global GDP per capita did not change much between 1000 and 1800 AD, and increased by about 200 and 900 percent in the 19th and 20th centuries respectively. In 1820, income inequality was within countries – there was little difference in average incomes between countries. By 1950, there was massive disparity in average incomes across countries.
Growth per capita in advanced countries was steady (with exceptions during the world wars and a few busts and booms), and gains in living standards came from prolonged and sustained growth and not from occasional bursts of rapid growth. The growth experience of developing countries, however, has been varied, with the sustained growth over decades required to raise living standards being rare.
In the 1950s, development thinking favoured government-led import substituting industrialisation. It had its effects – in India, the Hindu growth rate of 3.5[6] percent per annum between 1950 and 1980 was much more than the 0.8 percent annual growth of the last 50 years of British rule. But, over time, problems arising from this approach mounted. These included –
· South Asian growth was plagued by foreign exchange scarcity.
· In Latin America, growth halted with a series of debt crises in the 1980s.
· East Asia, with outward looking foreign trade policies, enjoyed ‘miracle growth’.
· There were increasing incidences of government failure.
The resultant disillusionment led to the evolution of the Washington Consensus, which was driven by neo-liberals with the backing of the World Bank and the International Monetary Fund. Its tenements were stabilisation, deregulation, liberalisation and privatisation, and it drove ten policies down the throats of client nations. These were –
1. Fiscal discipline
2. Reordering public investment towards economic, health and education infrastructure
3. Tax reform
4. Financial liberalisation
5. Competitive exchange rates
6. Trade liberalisation
7. Liberalisation of foreign direct investment
8. Privatisation
9. Deregulation
10. Property rights
Cracks in the consensus appeared when it was obvious that countries that took the reforms in full had modest growth and those that did not, such as China and India, had high growth. A newer view accepts that the uniform prescription along ten fronts for everybody does not work. Property rights, rule of law, market-oriented incentives, sound money and sustainable public finances are desirable factors everywhere in driving growth, and the others (such as, for example, privatisation and liberalisation of trade and FDI) need to be adjusted for the specific circumstances of the country.
The article goes into other interesting matters, such as the relationship between growth, poverty, employment and equity and the importance of economic policies to spur and sustain economic growth. SA makes two important points –
· Rapid and sustained growth is the most effective way of reducing poverty – that, on average, growth of income among the poor is very similar to growth of mean income.
· There is substantial variation around this average. Economic growth can be more or less pro-poor, and the policy environment is a key determinant to this.
I am not going to dwell on these matters, and would like to return to the issue of neo-liberalism. As mentioned earlier, it is considered an official villain within NGO circles. Why exactly this is so is not clear to me – the various analyses that I have been subjected to appear to have been developed in some donor agency’s boardroom, possibly with Africa and Latin America in mind. Theories with a global perspective, as we all know (and, for us in foreign donor agencies, as we constantly and invariably unsuccessfully try to communicate to our masters) do not apply very well to the Indian situation. And many of us who profess a deep antipathy to neo-liberalism can be seen in actuality to be proponents of its principles, as the popularity of user-fees for NGO-provided development services (even though, in most cases, some donor is meeting the costs in full) and other widely practised neo-liberal tenements indicate. There is clearly a need for clarity on this matter – is neo-liberalism a good thing, a bad one, a necessary evil, what?
Why so? For one, because crumbling public services are a fact of life! Creating demand for services and pressure upon the state to undertake its constitutional responsibility and provide them a la the ‘rights mode’ approach has not resulted in improvement[7] – the Indian state is good at resisting pressure to perform. It is unlikely, in my lifetime, that I will see an acceptable quality of service in health and education for the poor, and that the taxes and cesses that we pay will aim to provide this rather than contribute to our politicians’, bureaucrats’ and contractors’ personal wealth. People looking to by-pass the state and set up parallel systems for today’s sick and today’s children have a point.
And yet, by creating parallel outlets for the demand, we contribute to a vicious circle of reduced pressure on public systems, poorer public services and governance, increased donor dependence, and zero options for those unable to pay. It is one thing to have toll taxes every 20 km.s on every road (as does Gujarat, where I write this) and quite another to have the most privatised health system in the world (which India does) when health expenditure is the single largest cause of households slipping below the poverty line.
I do not claim to have answers – I would merely like to see good information and an educated and non-partisan debate on these matters. In my lifetime? I certainly hope so!
Acronyms:
CII Confederation of Indian Industry
EPW Economic and Political Weekly
EU European Union
FDI Foreign Direct Investment
GDP Gross Domestic Product
[1] From “An Essay on Criticism” by Alexander Pope in 1709
[2] Famous for finding the world flat!
[3] Famous for being a one-handed economist – he is not constantly saying ‘on the other hand’.
[4] He achieved the impossible by writing a popular best seller about Economics, the book “Freakonomics”.
[5] “Economic Growth: Some Reflections” by Shankar Acharya in the EPW of 4th November 2006.
[6] Apparently the term’s origin is in the similarity of 3.5 to the symbol for ‘Om’.
[7] Anyone doubting this is welcome to look at DFID’s recent evaluation of its work in India.
Sunday, June 17, 2007
INTRODUCTION
INTRODUCTION - WRITTEN IN MARCH 2004
Dear Friends and Colleagues,
As some of you know, I turned forty last year and am thus facing the usual conundrum of men hitting the middle ages – of wondering how (and whether) to change my life. The simple stuff has already been initiated – of avoiding social evenings in which the food is not great and/or the women not beautiful, of cutting out vegetables from the daily diet, and of upping my football sessions to twice (and maybe thrice, family permitting) a week. But the monumental changes that mark the watershed of one’s life haven’t happened. My wife still looks pretty good to me, and I have no intention of dumping her for some anorexic 22 year old (maybe fifty is a better time to implement this one). I still enjoy my work, so not much point in taking off to some lonely spot to do organic farming. And my reading habits, puerile though they are, will be inhibited by my lack of time, poor concentration and deep disinterest to take a sudden inclination towards Kafka or the classics. And therefore, there is this grave void in my life that requires fulfillment.
Well so what, I can hear you all saying, and how does this concern you?
Well, so I have decided that I will write a monthly paper on some topic of my professional interest and foist it on to all of you to read. And my request to you would be – please do read it. And, if you have something to add, subtract, multiply or divide, please do respond.
In the process, I make the following promises to you. First, that each paper will be no longer than two pages. Second, that it will be ready and circulated on the 15th of every month. Third, that I will stay away from my usual interests, which I have already been published on, such as herding goats in cold desert regions and football.
Love me, hate me, but please don’t ignore me!
With best wishes,
Ajit Chaudhuri
Dear Friends and Colleagues,
As some of you know, I turned forty last year and am thus facing the usual conundrum of men hitting the middle ages – of wondering how (and whether) to change my life. The simple stuff has already been initiated – of avoiding social evenings in which the food is not great and/or the women not beautiful, of cutting out vegetables from the daily diet, and of upping my football sessions to twice (and maybe thrice, family permitting) a week. But the monumental changes that mark the watershed of one’s life haven’t happened. My wife still looks pretty good to me, and I have no intention of dumping her for some anorexic 22 year old (maybe fifty is a better time to implement this one). I still enjoy my work, so not much point in taking off to some lonely spot to do organic farming. And my reading habits, puerile though they are, will be inhibited by my lack of time, poor concentration and deep disinterest to take a sudden inclination towards Kafka or the classics. And therefore, there is this grave void in my life that requires fulfillment.
Well so what, I can hear you all saying, and how does this concern you?
Well, so I have decided that I will write a monthly paper on some topic of my professional interest and foist it on to all of you to read. And my request to you would be – please do read it. And, if you have something to add, subtract, multiply or divide, please do respond.
In the process, I make the following promises to you. First, that each paper will be no longer than two pages. Second, that it will be ready and circulated on the 15th of every month. Third, that I will stay away from my usual interests, which I have already been published on, such as herding goats in cold desert regions and football.
Love me, hate me, but please don’t ignore me!
With best wishes,
Ajit Chaudhuri
Wednesday, May 30, 2007
Return of the Jedi
THE RETURN OF THE JEDI
A Two-Pager by Ajit Chaudhuri
Introduction: Some of you know that I had recently spent three months as a Visiting Fellow at the Institute of Rural Management (IRMA) in Anand, Gujarat. IRMA is an institution that I owe big time – for two wonderful football-filled years in the late 1980s, for a piece of paper that says that I am a post-graduate, for some lifelong friends, and for that lovely lady I met there who wakes up next to me every morning – yet I have been back only once since leaving and that was in 1999. And so, when Neelima Khetan (the Director of IRMA until very recently) popped the question, I agreed with an alacrity that must have made her think I was desperate. Luckily for me, she (and IRMA) followed through, my various bosses came around, and there I was with a car full of wife, children, maid, dog and 3 months necessities driving into the familiar campus in beginning November 2007. This paper looks to describe what it was like to return to the alma mater.
Jurassic Park: Early impressions were that not much had changed – the buildings and campus layout were the same except for an ugly monstrosity in front of the office building that belted out ‘Saare Jahaan se Achcha’ in chimes and, come sundown, transformed into a (very) poor man’s aurora borealis. The debates brought out a sense of déjà vu – I hadn’t heard ‘sector versus non-sector’ for 17 plus years, and it was nice to know that there is still a corner of the country where cooperatives are seen in a positive light. But – there were many more female students and ‘B’ block, where I stayed, is now a Ladies residence. And Jagnath is not a hub of activity any more – Dawoodbhai’s shop was burnt down in the 2002 riots, and there is now a shorter route into Anand town. And the students’ mess did not serve Kentucky Fried Chicken on Sunday nights.
The Students: As a student, I did not realise how central we were to IRMA. I came in this time when both batches were off campus – the senior batch was at their management-training segment and would return only in January, and the junior batch was at fieldwork and would return in December. Faculty and staff alike roamed around with long faces and desultory attitudes for my whole first month, brightening up only one Sunday late in November and saying ‘They’re back!!’ The whole place changed! It was almost like the relationship between the garden and the children in the old folk tale ‘The Selfish Giant’.
I have heard many people from the NGO sector, including IRMAns of my generation, bleating on about young people not being sufficiently dedicated, motivated and committed, blah, blah, blah, to make a career in development. My time spent with the students here was an eye-opener. They are completely different from our times, and they face different pressures. Most of them are older, and with work experience[1], and they don’t ask their parents to shell out the now considerable fees and living expenses – and so most of them have a never-never on their heads as soon as they walk out of the institute. The salary differentials between the development sector and the other places from where they get job offers is now huge, unlike the late 1980s when the starting differentials were minimal[2]. And the non-financial attractions of the development sector are not as apparent to current students as they were to us – they see NGOs as being unaccountable fiefdoms that do very little and spend a lot of aid money doing it, and their experiences during their fieldwork segment at IRMA do not contradict this viewpoint. Are they lacking in social values? No – the senior batch ran a slum development programme on their own time and money (both of which, as all postgraduate students in professional courses will know, are scarce commodities), the same slum outside the campus that our generation of students used to pass but chose not to notice. Current students are looking to make a difference to society through modern means, such as making the Internet work for the poor, or getting financial services to reach the needy, and not by joining NGOs and starving.
As I hope is obvious to the reader, I enjoyed my interaction with the students very much, both the formal interaction in the classrooms and the informal ones in my office, at the mess, and over cigarettes. They were challenging and stimulating and occasionally exasperating (especially so on Monday at 0900). I learnt a lot from them, and I will never listen to cribbing about young people’s lack of value systems and greed for money again.
The Faculty: IRMA was in a state of flux during my stay, mostly from the aftermath of an internecine struggle for control within the board of directors. One bunch of professors had just left the institute, another bunch was in the process of leaving, and there was a bit of an atmosphere of whispers, cliques and coteries that I wanted none of. I avoided the faculty lounges as a result, and had my tea, cigarettes and gossip sessions at the common facilities. I found, 3 months later, that I had really interacted with very few of my colleagues and, looking back, I wish that I had got to know some of them better.
Comparing from my time as a student, the professors now were mostly PhD-types whereas in the 1980s they were mostly fellows from management institutes. There was the usual mix of those who were liked, those who were respected, and a few who were liked and respected. I didn’t get the impression that anybody was disliked and/or disrespected, unlike our time when there were candidates for both, including the combination. Though old timers said that the earlier interaction between professors and students was closer, I did not personally notice this.
What did I do? Looking back, I seem to have spent a lot of time during work hours smoking, drinking coffee and discussing life with Professors DPM and Jayapadma, who were great company. In between that, I managed to take a few sessions with the senior batch on looking at project proposals and setting up monitoring and evaluation systems.
One of the projects I initiated was to get IRMAns of 15-20 years vintage to come back to IRMA and talk to the current students about their own careers – this was to address common fears that an IRMA degree is not sufficient to make it in life, and to get students to look ahead and think careers rather than jobs. The key fringe benefit was that I met some old friends again, Sinha, Gouthami, Chadha. I did one of the talks myself. I was very happy to learn that IRMA is planning to continue the ‘Journeys’ project.
I also did a research on the sort of contact IRMA had with the organisations it interacts with. The conclusions provided a bit of shock value – IRMA had an all-round long-term relationship with few organisations and one-off contact with many. If IRMA were a woman, I would want to know her. I still wonder what the policy makers made of that.
There were other things. Some were hatchet jobs that were passed on to me, I suspect, because of the duration of my tenure and therefore my lack of a need to invest in the long-term goodwill of my colleagues in the faculty. Some were the tasks of sitting on committees of various sorts. I think I came away with an appreciation of the difficulties of getting work done in a flat organisation structure.
My Family: My family joined me for two of the three months. IRMA made us very welcome, and made it as easy as possible to adjust. Accommodation was ready and liveable upon our arrival, with even many of the small things (linen, towels, cutlery) provided for with care and thought. Everyone made allowances for my noisy children and boisterous dog. Washing, cleaning and cooking support was organised almost immediately. IRMA even provided my wife with ‘visiting scholar’ status, and with it an office, computer and Internet. We have much to be grateful for to Professor DPM, who was coordinating the visiting fellows programme, the administration team of Mr.s Patnaik and Solanki, and Mr. BC Patel from the estates department. If there were any cribs, it was that one toilet was too few for all of us (if any of you are planning something similar, negotiate a B-type residence), and that the local school (yes, the much acclaimed Anandalaya) was pathetic – we pulled the kids out in the second week.
The Highlights: Three months in Gujarat, no booze or football, not much flesh in the diet, not exactly an ornithologist’s paradise, how on earth did I survive?
· The students, and the interaction with them that I have already described.
· My colleagues Gazala and Akhil coming over from Ahmedabad on our first Sunday in Anand with two bottles of whisky and huge quantities of mutton.
· My Dad, sister, brother, brother-in-law and nephew congregating here from Bangalore and Delhi, all seeing IRMA for the first time. The accommodation at the guesthouse was great, and we had a wonderful time. We took an expedition to Lothal, the Indus valley civilisation site just about 100 km away.
· I finally managed to take my family to Kutch, and to see the bird sanctuary in the wetlands around the rann. Winter was the perfect time for this – we saw the cranes, and the staying facilities at the indigenous tourism project at Hodka were great.
· The students had a festival for the alumni towards the end of January. I got to hear Indian Ocean play live in a near-perfect setting – the IRMA lawns – and I participated in, completed, and finished creditably in the Anand Run (a 5 kilometre road race).
· Professor Jayapadma’s daughter, Karuna, who had my wife and me seeing first hand what we were missing by not having a little girl in the house.
[1] Though the admissions policy of having a few Delhi babes straight from university to brighten the place up continues.
[2] ITC and ICICI start people at Rs. 50,000 per month. NGOs start at about Rs. 12-15,000. In the late 1980s, the hot NDDB job started at Rs. 2,700 and the NGOs at about Rs. 2,000.
A Two-Pager by Ajit Chaudhuri
Introduction: Some of you know that I had recently spent three months as a Visiting Fellow at the Institute of Rural Management (IRMA) in Anand, Gujarat. IRMA is an institution that I owe big time – for two wonderful football-filled years in the late 1980s, for a piece of paper that says that I am a post-graduate, for some lifelong friends, and for that lovely lady I met there who wakes up next to me every morning – yet I have been back only once since leaving and that was in 1999. And so, when Neelima Khetan (the Director of IRMA until very recently) popped the question, I agreed with an alacrity that must have made her think I was desperate. Luckily for me, she (and IRMA) followed through, my various bosses came around, and there I was with a car full of wife, children, maid, dog and 3 months necessities driving into the familiar campus in beginning November 2007. This paper looks to describe what it was like to return to the alma mater.
Jurassic Park: Early impressions were that not much had changed – the buildings and campus layout were the same except for an ugly monstrosity in front of the office building that belted out ‘Saare Jahaan se Achcha’ in chimes and, come sundown, transformed into a (very) poor man’s aurora borealis. The debates brought out a sense of déjà vu – I hadn’t heard ‘sector versus non-sector’ for 17 plus years, and it was nice to know that there is still a corner of the country where cooperatives are seen in a positive light. But – there were many more female students and ‘B’ block, where I stayed, is now a Ladies residence. And Jagnath is not a hub of activity any more – Dawoodbhai’s shop was burnt down in the 2002 riots, and there is now a shorter route into Anand town. And the students’ mess did not serve Kentucky Fried Chicken on Sunday nights.
The Students: As a student, I did not realise how central we were to IRMA. I came in this time when both batches were off campus – the senior batch was at their management-training segment and would return only in January, and the junior batch was at fieldwork and would return in December. Faculty and staff alike roamed around with long faces and desultory attitudes for my whole first month, brightening up only one Sunday late in November and saying ‘They’re back!!’ The whole place changed! It was almost like the relationship between the garden and the children in the old folk tale ‘The Selfish Giant’.
I have heard many people from the NGO sector, including IRMAns of my generation, bleating on about young people not being sufficiently dedicated, motivated and committed, blah, blah, blah, to make a career in development. My time spent with the students here was an eye-opener. They are completely different from our times, and they face different pressures. Most of them are older, and with work experience[1], and they don’t ask their parents to shell out the now considerable fees and living expenses – and so most of them have a never-never on their heads as soon as they walk out of the institute. The salary differentials between the development sector and the other places from where they get job offers is now huge, unlike the late 1980s when the starting differentials were minimal[2]. And the non-financial attractions of the development sector are not as apparent to current students as they were to us – they see NGOs as being unaccountable fiefdoms that do very little and spend a lot of aid money doing it, and their experiences during their fieldwork segment at IRMA do not contradict this viewpoint. Are they lacking in social values? No – the senior batch ran a slum development programme on their own time and money (both of which, as all postgraduate students in professional courses will know, are scarce commodities), the same slum outside the campus that our generation of students used to pass but chose not to notice. Current students are looking to make a difference to society through modern means, such as making the Internet work for the poor, or getting financial services to reach the needy, and not by joining NGOs and starving.
As I hope is obvious to the reader, I enjoyed my interaction with the students very much, both the formal interaction in the classrooms and the informal ones in my office, at the mess, and over cigarettes. They were challenging and stimulating and occasionally exasperating (especially so on Monday at 0900). I learnt a lot from them, and I will never listen to cribbing about young people’s lack of value systems and greed for money again.
The Faculty: IRMA was in a state of flux during my stay, mostly from the aftermath of an internecine struggle for control within the board of directors. One bunch of professors had just left the institute, another bunch was in the process of leaving, and there was a bit of an atmosphere of whispers, cliques and coteries that I wanted none of. I avoided the faculty lounges as a result, and had my tea, cigarettes and gossip sessions at the common facilities. I found, 3 months later, that I had really interacted with very few of my colleagues and, looking back, I wish that I had got to know some of them better.
Comparing from my time as a student, the professors now were mostly PhD-types whereas in the 1980s they were mostly fellows from management institutes. There was the usual mix of those who were liked, those who were respected, and a few who were liked and respected. I didn’t get the impression that anybody was disliked and/or disrespected, unlike our time when there were candidates for both, including the combination. Though old timers said that the earlier interaction between professors and students was closer, I did not personally notice this.
What did I do? Looking back, I seem to have spent a lot of time during work hours smoking, drinking coffee and discussing life with Professors DPM and Jayapadma, who were great company. In between that, I managed to take a few sessions with the senior batch on looking at project proposals and setting up monitoring and evaluation systems.
One of the projects I initiated was to get IRMAns of 15-20 years vintage to come back to IRMA and talk to the current students about their own careers – this was to address common fears that an IRMA degree is not sufficient to make it in life, and to get students to look ahead and think careers rather than jobs. The key fringe benefit was that I met some old friends again, Sinha, Gouthami, Chadha. I did one of the talks myself. I was very happy to learn that IRMA is planning to continue the ‘Journeys’ project.
I also did a research on the sort of contact IRMA had with the organisations it interacts with. The conclusions provided a bit of shock value – IRMA had an all-round long-term relationship with few organisations and one-off contact with many. If IRMA were a woman, I would want to know her. I still wonder what the policy makers made of that.
There were other things. Some were hatchet jobs that were passed on to me, I suspect, because of the duration of my tenure and therefore my lack of a need to invest in the long-term goodwill of my colleagues in the faculty. Some were the tasks of sitting on committees of various sorts. I think I came away with an appreciation of the difficulties of getting work done in a flat organisation structure.
My Family: My family joined me for two of the three months. IRMA made us very welcome, and made it as easy as possible to adjust. Accommodation was ready and liveable upon our arrival, with even many of the small things (linen, towels, cutlery) provided for with care and thought. Everyone made allowances for my noisy children and boisterous dog. Washing, cleaning and cooking support was organised almost immediately. IRMA even provided my wife with ‘visiting scholar’ status, and with it an office, computer and Internet. We have much to be grateful for to Professor DPM, who was coordinating the visiting fellows programme, the administration team of Mr.s Patnaik and Solanki, and Mr. BC Patel from the estates department. If there were any cribs, it was that one toilet was too few for all of us (if any of you are planning something similar, negotiate a B-type residence), and that the local school (yes, the much acclaimed Anandalaya) was pathetic – we pulled the kids out in the second week.
The Highlights: Three months in Gujarat, no booze or football, not much flesh in the diet, not exactly an ornithologist’s paradise, how on earth did I survive?
· The students, and the interaction with them that I have already described.
· My colleagues Gazala and Akhil coming over from Ahmedabad on our first Sunday in Anand with two bottles of whisky and huge quantities of mutton.
· My Dad, sister, brother, brother-in-law and nephew congregating here from Bangalore and Delhi, all seeing IRMA for the first time. The accommodation at the guesthouse was great, and we had a wonderful time. We took an expedition to Lothal, the Indus valley civilisation site just about 100 km away.
· I finally managed to take my family to Kutch, and to see the bird sanctuary in the wetlands around the rann. Winter was the perfect time for this – we saw the cranes, and the staying facilities at the indigenous tourism project at Hodka were great.
· The students had a festival for the alumni towards the end of January. I got to hear Indian Ocean play live in a near-perfect setting – the IRMA lawns – and I participated in, completed, and finished creditably in the Anand Run (a 5 kilometre road race).
· Professor Jayapadma’s daughter, Karuna, who had my wife and me seeing first hand what we were missing by not having a little girl in the house.
[1] Though the admissions policy of having a few Delhi babes straight from university to brighten the place up continues.
[2] ITC and ICICI start people at Rs. 50,000 per month. NGOs start at about Rs. 12-15,000. In the late 1980s, the hot NDDB job started at Rs. 2,700 and the NGOs at about Rs. 2,000.
Saturday, April 28, 2007
Money For Nothing!
MONEY FOR NOTHING!
A 2-pager by Ajit Chaudhuri
April 2007
“Those who forget the past are doomed to repeat it!”[1]
It was just a little while back that the word ‘aid fatigue’ had crept into our lexicon – the result of the perception that all that money and effort for so long was not doing very much. The starving children and crying women were still there and in numbers, their leaders were living better and better and fighting each other more and more, and NGOs and the Swiss banking system were flourishing. ‘Screw the whole bloody lot of them!’ the givers seemed to be saying, ‘They’re not getting any more of our money!’
And then, quite suddenly, the scenario changed – and aid became fashionable again. There appear to have been three drivers. The first was Afghanistan, where first-world living rooms saw the consequences to them of a failed state. The second was Mrs. and Mr. Gates jumping a stage in Maslow’s hierarchy of needs[2]. And the third was the Millennium Declaration – a desperate effort by the UN to sex aid up and reduce problems down into easily understandable goals, targets and indicators.
Are things going to be different this time around, I wonder, and will we see real change? Or is it going to be more of the same – the bloody conflicts, pathetic women and children, and that tired but pretty blonde lady from some INGO or the other telling us on TV that ‘there is so much more to be done’ – you know the scenario – with more hot air in conferences on trade vs. aid, teaching people to fish and that %*# EU agriculture subsidy.
It was therefore a pleasant surprise to read an insightful paper questioning the holy cows of trade and aid and looking at how to really help poor countries. This is by Nancy Birdsall, Dani Rodrik and Arvind Subramanian, was published in the Journal of Foreign Affairs of July/August 2005, and is imaginatively entitled ‘How to Help Poor Countries’.
The paper begins by saying that the key areas of thrust in the current international development scenario – the MDGs, the focus on increasing rich countries’ aid outflows to 0.7 percent of GDP, and the attempts in global trade circles to open first-world markets to exports from developing countries – make two implicit assumptions. First, that rich countries can shape development in poor countries. Second, that the key requirements for this are money and trading opportunities. These assumptions, the paper says, ignore some key lessons of the past four decades; that poor countries themselves largely determine their development status, and that financial aid and opening of rich countries’ markets have a limited ability to trigger growth, especially in the poorest countries. And therefore, that energy and political capital concentrated on these efforts should not draw attention away from other methods by which ‘rich countries can do less harm’.
Lets have a look at some examples –
· The two current darlings of development are India and China. Both have prospered and reduced poverty without benefit from trade preferences and without much aid[3]. Sub-Saharan Africa, on the other hand, received on average 12 percent of GDP in aid in the 1990s, a period when per capita growth declined by 0.6 percent every year.
· Nicaragua and Vietnam are poor countries with primarily agricultural economies, and both have benefited from substantial foreign aid. Yet, only Vietnam has experienced steady growth and poverty reduction, despite not being a member of WTO and Nicaragua having loans written off and having preferential access to US markets.
Global Trade: There is little doubt that the international trade system is iniquitous.
· Rich countries place highest tariffs on imports that are important to developing countries, such as garments and agricultural produce.
· Tariffs escalate as the level of processing increases, discouraging industrialization.
· Trade negotiations lack transparency and exclude poor countries.
· Using WTO procedures require money and technical expertise.
And yet, there are remarkable success stories; China and Vietnam in manufactured goods, India in services, Chile in wines, and many more. It is therefore useful to understand the effect of tariffs, subsidies and barriers in rich countries on poverty in poor countries.
Suppose, for example, the much-reviled agricultural subsidy in the EU was reduced and there was a rise in world agricultural prices. The big gainers would be large agricultural exporting nations such as the US, Canada and Argentina, and possibly EU citizens (less taxes but increased food prices). Poor countries, however, are usually net importers of food, and their urban poor will be hugely negatively affected. Net poverty may reduce because of gains to local farmers, but this is complicated to ascertain[4]. Agricultural liberalization may or may not reduce poverty, but its net impact either way is limited. And a reduction in trade barriers in rich countries may well leave poor countries worse off – many enjoy favorable conditions of access under preferential trade arrangements.
More Aid: International aid has done many things – eradicated small pox, reduced infant mortality rates, restored peace and order after conflict, etc. – more so when it has been targeted at specific objectives and when recipient countries have had leadership and capacity and done the right things. But aid has not been associated with sustained growth.
There are many reasons for this! Primarily, on the donors’ side, there has been a multiplicity of donors pursuing many, often inconsistent, objectives, disbursing to innumerable projects and imposing onerous conditions. On the recipients’ side, those that are most in need have been least able to use aid well due to institutional deficiencies.
The paper goes on into how rich countries can do less harm – interesting, maybe useful, and also easily accessible on the net via a google search on ‘birdsall help poor countries’.
To conclude: Many of us already know that aid money is not a driver of economic growth and poverty alleviation – certainly not in India. But we do tend to adhere to mantras on the benefits of freer trade and the evils of first-world protectionism. I have myself had arguments with European counterparts along the lines of ‘if you were serious about ending poverty and hunger you would dismantle your common agricultural policy instead of creating the problems first and then throwing a few lollipops around’[5]. The viewpoint expressed here, not ‘trade or aid’ or ‘trade and aid’ but ‘neither trade nor aid’, does provide food for thought. I am not sure if I subscribe completely as yet and, if I did, what invective would be thrown at me. Neo-liberal? Neo-conservative? Neo-classical?
Acronyms / Jargon Watch
DFID Department for International Development, the Government of UK
EU European Union
GDP Gross Domestic Product
INGO International NGO
MDG Millennium Development Goal
NGO Non-governmental Organization
TRIPS Trade related aspects of intellectual property rights
UN United Nations
WTO World Trade Organization
[1] This is credited to the Spanish-American intellectual George Santayana, though various versions have appeared in different places including in William Shirer’s ‘Rise and Fall of the Third Reich’.
[2] Management students would remember Maslow and the movement from basic needs to self-actualization.
[3] According to DFID, assistance to India stands at about 0.2 percent of GDP. China’s would be even less.
[4] Factors such as the extent of skew in landholdings, the effect of higher prices on agricultural wages, the ability of the agricultural sector to drive the economy, inter alia, would be critical here.
[5] One of these, incidentally, at the WTO headquarters in Geneva, where I had spent a day in 2001 as part of the Chevening Gurukul scholarship.
A 2-pager by Ajit Chaudhuri
April 2007
“Those who forget the past are doomed to repeat it!”[1]
It was just a little while back that the word ‘aid fatigue’ had crept into our lexicon – the result of the perception that all that money and effort for so long was not doing very much. The starving children and crying women were still there and in numbers, their leaders were living better and better and fighting each other more and more, and NGOs and the Swiss banking system were flourishing. ‘Screw the whole bloody lot of them!’ the givers seemed to be saying, ‘They’re not getting any more of our money!’
And then, quite suddenly, the scenario changed – and aid became fashionable again. There appear to have been three drivers. The first was Afghanistan, where first-world living rooms saw the consequences to them of a failed state. The second was Mrs. and Mr. Gates jumping a stage in Maslow’s hierarchy of needs[2]. And the third was the Millennium Declaration – a desperate effort by the UN to sex aid up and reduce problems down into easily understandable goals, targets and indicators.
Are things going to be different this time around, I wonder, and will we see real change? Or is it going to be more of the same – the bloody conflicts, pathetic women and children, and that tired but pretty blonde lady from some INGO or the other telling us on TV that ‘there is so much more to be done’ – you know the scenario – with more hot air in conferences on trade vs. aid, teaching people to fish and that %*# EU agriculture subsidy.
It was therefore a pleasant surprise to read an insightful paper questioning the holy cows of trade and aid and looking at how to really help poor countries. This is by Nancy Birdsall, Dani Rodrik and Arvind Subramanian, was published in the Journal of Foreign Affairs of July/August 2005, and is imaginatively entitled ‘How to Help Poor Countries’.
The paper begins by saying that the key areas of thrust in the current international development scenario – the MDGs, the focus on increasing rich countries’ aid outflows to 0.7 percent of GDP, and the attempts in global trade circles to open first-world markets to exports from developing countries – make two implicit assumptions. First, that rich countries can shape development in poor countries. Second, that the key requirements for this are money and trading opportunities. These assumptions, the paper says, ignore some key lessons of the past four decades; that poor countries themselves largely determine their development status, and that financial aid and opening of rich countries’ markets have a limited ability to trigger growth, especially in the poorest countries. And therefore, that energy and political capital concentrated on these efforts should not draw attention away from other methods by which ‘rich countries can do less harm’.
Lets have a look at some examples –
· The two current darlings of development are India and China. Both have prospered and reduced poverty without benefit from trade preferences and without much aid[3]. Sub-Saharan Africa, on the other hand, received on average 12 percent of GDP in aid in the 1990s, a period when per capita growth declined by 0.6 percent every year.
· Nicaragua and Vietnam are poor countries with primarily agricultural economies, and both have benefited from substantial foreign aid. Yet, only Vietnam has experienced steady growth and poverty reduction, despite not being a member of WTO and Nicaragua having loans written off and having preferential access to US markets.
Global Trade: There is little doubt that the international trade system is iniquitous.
· Rich countries place highest tariffs on imports that are important to developing countries, such as garments and agricultural produce.
· Tariffs escalate as the level of processing increases, discouraging industrialization.
· Trade negotiations lack transparency and exclude poor countries.
· Using WTO procedures require money and technical expertise.
And yet, there are remarkable success stories; China and Vietnam in manufactured goods, India in services, Chile in wines, and many more. It is therefore useful to understand the effect of tariffs, subsidies and barriers in rich countries on poverty in poor countries.
Suppose, for example, the much-reviled agricultural subsidy in the EU was reduced and there was a rise in world agricultural prices. The big gainers would be large agricultural exporting nations such as the US, Canada and Argentina, and possibly EU citizens (less taxes but increased food prices). Poor countries, however, are usually net importers of food, and their urban poor will be hugely negatively affected. Net poverty may reduce because of gains to local farmers, but this is complicated to ascertain[4]. Agricultural liberalization may or may not reduce poverty, but its net impact either way is limited. And a reduction in trade barriers in rich countries may well leave poor countries worse off – many enjoy favorable conditions of access under preferential trade arrangements.
More Aid: International aid has done many things – eradicated small pox, reduced infant mortality rates, restored peace and order after conflict, etc. – more so when it has been targeted at specific objectives and when recipient countries have had leadership and capacity and done the right things. But aid has not been associated with sustained growth.
There are many reasons for this! Primarily, on the donors’ side, there has been a multiplicity of donors pursuing many, often inconsistent, objectives, disbursing to innumerable projects and imposing onerous conditions. On the recipients’ side, those that are most in need have been least able to use aid well due to institutional deficiencies.
The paper goes on into how rich countries can do less harm – interesting, maybe useful, and also easily accessible on the net via a google search on ‘birdsall help poor countries’.
To conclude: Many of us already know that aid money is not a driver of economic growth and poverty alleviation – certainly not in India. But we do tend to adhere to mantras on the benefits of freer trade and the evils of first-world protectionism. I have myself had arguments with European counterparts along the lines of ‘if you were serious about ending poverty and hunger you would dismantle your common agricultural policy instead of creating the problems first and then throwing a few lollipops around’[5]. The viewpoint expressed here, not ‘trade or aid’ or ‘trade and aid’ but ‘neither trade nor aid’, does provide food for thought. I am not sure if I subscribe completely as yet and, if I did, what invective would be thrown at me. Neo-liberal? Neo-conservative? Neo-classical?
Acronyms / Jargon Watch
DFID Department for International Development, the Government of UK
EU European Union
GDP Gross Domestic Product
INGO International NGO
MDG Millennium Development Goal
NGO Non-governmental Organization
TRIPS Trade related aspects of intellectual property rights
UN United Nations
WTO World Trade Organization
[1] This is credited to the Spanish-American intellectual George Santayana, though various versions have appeared in different places including in William Shirer’s ‘Rise and Fall of the Third Reich’.
[2] Management students would remember Maslow and the movement from basic needs to self-actualization.
[3] According to DFID, assistance to India stands at about 0.2 percent of GDP. China’s would be even less.
[4] Factors such as the extent of skew in landholdings, the effect of higher prices on agricultural wages, the ability of the agricultural sector to drive the economy, inter alia, would be critical here.
[5] One of these, incidentally, at the WTO headquarters in Geneva, where I had spent a day in 2001 as part of the Chevening Gurukul scholarship.
Thursday, March 29, 2007
Time Out
TIME OUT
A 2-Pager by Ajit Chaudhuri
March 2007
Most of us do not have smooth career paths. There are negative slopes, dotted lines and blank spaces in our achievement versus time graphs, and periods when cynicism levels are high, when completing sudoku puzzles become a major objective, and when we are particularly susceptible to proposals from friends to walk across the Himalayas. Some of us have dropped out completely or moved off-track to do something different, and some have searched for stimulation through extra-marital misadventures or other self-destructive behaviour. Such are the effects of the ‘outs’.
Those of us plodding away within an organization are familiar with the ‘outs’, we see them often enough and experience them occasionally. Frozen out when stylistic idiosyncrasies clash with a superior’s personality or an organization’s culture. Burned out by the toxic triad of an overwhelming workload, the inability to see the positive impacts of one’s labours, and the failure to achieve one’s career ambitions. Psyched out by biological or psychological changes that trigger a midlife crisis. Flaming out from a fundamental incompatibility between one’s abilities and the requirements of the job.
There are some alpha plus types, one had always assumed, who do not have these problems – who have a smooth, short and inexorable rise to the top, whose career graphs turn sharply upwards from their late twenties and plateau out only in the stratosphere – the supercharged ones who exult in winning, in mastering new skills and in surpassing previous benchmarks of excellence. It was therefore interesting to read an article in a recent HBR[1] of a problem that is exclusive to these types that the authors have called the Summit Syndrome (SS – with due apologies to Adolf). Interesting because it says something about the career paths of the highly successful, and interesting because it explains the gaps we sometimes see between perceived potential and actual achievement.
The first point the authors make is that a successful career is not a straight line to the top; it is more like a series of northeast pointing S-curves with each S representing a job or task. Stage 1 at the bottom of the S represents the beginning of a new role, of assessing and assembling the requirements for the climb (building a new network, forming relationships with one’s team, developing a strategy, etc.). Stage 2 represents the ascent up the slope, a period of learning and adapting to the role, of developing the appropriate levels of skill and proficiency, of figuring out how to navigate the organizational territory and the external competitive environment. Stage 3 represents the approach to the summit, which is when the onset of SS occurs – mastering the work triggers discomfort and is the harbinger of a crisis. Stage 4 represents the plateau, when the challenge has been conquered and the requirement is to coast along until the next task – super-achievers have difficulty in negotiating flat terrain and this is a time of inner turmoil and mounting confusion about career direction. Stage 5 represents the descent and is characterized by an obvious drop in performance and career-limiting behaviour.
SUMMIT PHASE
INTERNAL SYMPTOMS
EXTERNAL SYMPTOMS
Approaching
· Low level discontent
· “What happened to the excitement?”
· Subtle loss of edge
· Emerging distractions
o Hobby obsessions
o Heightened appetite for stimulation
o Daydreaming
· Attraction to unsolicited offers
Plateauing
· Loss of enthusiasm
· Fearing loss of career momentum and legacy
· ‘What happened to my goals?”
· Working harder to do the basics
· More serious distractions
o Fancier adventures
o Curiosity about alternate lifestyles
o More vacations
· Unorthodox career choices attract disproportionate consideration
Descending
· Feeling lost
· Cynicism, anger, frustration are near the surface
· “What happened to my career?”
· Working harder to conceal disengagement
· Severe distractions
o Substance abuse
o Sexual indiscretions
o Unconscious career sabotage
· Bailing out
SS is quite unlike the other “outs”. This is not a once-in-a-lifetime event like a mid-life crisis. Those in the initial phases of SS have not been frozen out or marginalized – they reside in the inner circles. They rarely burn out – they see the impact of their work and welcome big demands. Their capabilities are not merely aligned with organizational purpose, they are admired and celebrated by superiors, peers and subordinates alike. In short, they are the superstars – they do not have the insecurity and inferiority complexes of the victims of the “outs”. And SS is more profound for the more proficient – it causes superstars to leave the fast track, drift from one job to another, and ultimately be among those highly promising men and women who never manage to achieve the positions and goals that friends and colleagues had assumed they would. For their organizations, this uncharacteristic behaviour from those least expected to disappoint comes as a shock. Getting them back in the saddle is expensive in terms of lost contribution, organization disruption and the price of counseling – but that’s the best-case scenario. The worst is surprise departures that rob organizations of their most promising talents.
The rest of the article is about recognizing and handling SS. I am going to move from the international corporate sector to the Indian development sector, as usual. We need to attract good people in and retain them to survive. Getting them in is comparatively easy – a nice pep talk about motivation, commitment, the need to give back to the country, etc., etc., tends to suffice. Retaining them is much more difficult, organizations in the sector have little knowledge of the frustrations such people face and are constantly and continuously surprised by the sudden departures of their prodigies. Making do with the ordinary is not enough – we need to engage with the brilliant to keep this sector vibrant and in tune with the challenges faced. Bleating on about their fickle nature, their capriciousness and their turbo-charged ambition is pointless. Maybe we can learn from those with experience in dealing with them, such as the international corporate sector.
I would like to conclude by returning to the subject of the ‘outs’. There is little understanding of this phenomenon within the development sector, especially the ‘outs’ faced by the brilliant. The first ‘outs’ occur before they actually land up at the NGO’s doorstep. Their parents freak out, and they contemplate a life out of pocket. Nothing new with the former, plenty with the latter! Salary differentials, even at entry levels, between the development sector and outside are now humungous. And today’s youth do not ask Mom and Dad for money, they prefer a bank loan for their post-graduation. And yet, despite poor salaries, despite EMIs, despite parental, peer and to-be-spouse pressure, and despite plenty of options, some brilliant people do come into the sector.
The mismatch between the organization’s requirements and the individual’s abilities invariably occurs from the beginning. A best-case scenario is when the recruit is given responsibilities that include the hurly-burly of dealing with communities (something that no post-graduate degree prepares one for), forcing her/him to sink or swim. If s/he sinks – good riddance! If not, you have somebody worth keeping. The worst is when the organization dumps all its English-writing requirements (proposals, reports, blah, blah, blah!) on this person – a quick flame out happens. Bosses, such people have not come to be glorified translators and candy floss for donor visits. The disservice you do to the sector far outweighs the immediate relief from meeting writing deadlines.
Empirical evidence points to the first burn out happening 2 to 3 years after the person joins. And while the results of our work are right in front of us, the other elements of the toxic triad are joined by a third – that city kids working in the boondocks miss the lights, sound and action and feel that life is passing them by. Cynicism and faultfinding set in, and they pick the wrong fights and create tension. What should the organization do? One, recognize it for what it is – a burnout and not some fundamental deficiency in either the individual or the organization. Two, provide space for introspective thinking (facilitate long term training, for example). Three, if it comes to losing the person, make sure that the process is pleasant and positive. Use your contacts within the sector to place the person suitably and ensure that your recommendations are not coloured by the recent past. And four, maintain the relationship – the brilliant will always rise in the world.
The most dangerous of the ‘outs’ happens to the brilliant in mid-life, because those that have stayed in the sector are now leaders and policy-makers. Many re-evaluate their objectives at this stage, weigh them up against financial and physical security concerns[2], and get psyched out. Organizations lose their way when this happens to the boss – the bricks and mortar, vehicles and salaries become more important than the communities served and problems addressed. The donors become kings, and others within the organization, especially the other brilliant, become threats. Everything works to enable this one person to stay in position. Vision, mission and values turn into more jargon.
Some survive the ‘outs’ and go on to do their best work later in their careers. But the unrealized potential and overall loss to the sector of those who don’t is huge. It would be useful for development organizations to work out ways of dealing with the ‘outs’.
[1] “Crisis at the Summit”, George Parsons and Richard Pascale, Harvard Business Review of March 2007
2. An old saying goes - men, when they turn 40, rethink the value of honesty, and women of virtue.
A 2-Pager by Ajit Chaudhuri
March 2007
Most of us do not have smooth career paths. There are negative slopes, dotted lines and blank spaces in our achievement versus time graphs, and periods when cynicism levels are high, when completing sudoku puzzles become a major objective, and when we are particularly susceptible to proposals from friends to walk across the Himalayas. Some of us have dropped out completely or moved off-track to do something different, and some have searched for stimulation through extra-marital misadventures or other self-destructive behaviour. Such are the effects of the ‘outs’.
Those of us plodding away within an organization are familiar with the ‘outs’, we see them often enough and experience them occasionally. Frozen out when stylistic idiosyncrasies clash with a superior’s personality or an organization’s culture. Burned out by the toxic triad of an overwhelming workload, the inability to see the positive impacts of one’s labours, and the failure to achieve one’s career ambitions. Psyched out by biological or psychological changes that trigger a midlife crisis. Flaming out from a fundamental incompatibility between one’s abilities and the requirements of the job.
There are some alpha plus types, one had always assumed, who do not have these problems – who have a smooth, short and inexorable rise to the top, whose career graphs turn sharply upwards from their late twenties and plateau out only in the stratosphere – the supercharged ones who exult in winning, in mastering new skills and in surpassing previous benchmarks of excellence. It was therefore interesting to read an article in a recent HBR[1] of a problem that is exclusive to these types that the authors have called the Summit Syndrome (SS – with due apologies to Adolf). Interesting because it says something about the career paths of the highly successful, and interesting because it explains the gaps we sometimes see between perceived potential and actual achievement.
The first point the authors make is that a successful career is not a straight line to the top; it is more like a series of northeast pointing S-curves with each S representing a job or task. Stage 1 at the bottom of the S represents the beginning of a new role, of assessing and assembling the requirements for the climb (building a new network, forming relationships with one’s team, developing a strategy, etc.). Stage 2 represents the ascent up the slope, a period of learning and adapting to the role, of developing the appropriate levels of skill and proficiency, of figuring out how to navigate the organizational territory and the external competitive environment. Stage 3 represents the approach to the summit, which is when the onset of SS occurs – mastering the work triggers discomfort and is the harbinger of a crisis. Stage 4 represents the plateau, when the challenge has been conquered and the requirement is to coast along until the next task – super-achievers have difficulty in negotiating flat terrain and this is a time of inner turmoil and mounting confusion about career direction. Stage 5 represents the descent and is characterized by an obvious drop in performance and career-limiting behaviour.
SUMMIT PHASE
INTERNAL SYMPTOMS
EXTERNAL SYMPTOMS
Approaching
· Low level discontent
· “What happened to the excitement?”
· Subtle loss of edge
· Emerging distractions
o Hobby obsessions
o Heightened appetite for stimulation
o Daydreaming
· Attraction to unsolicited offers
Plateauing
· Loss of enthusiasm
· Fearing loss of career momentum and legacy
· ‘What happened to my goals?”
· Working harder to do the basics
· More serious distractions
o Fancier adventures
o Curiosity about alternate lifestyles
o More vacations
· Unorthodox career choices attract disproportionate consideration
Descending
· Feeling lost
· Cynicism, anger, frustration are near the surface
· “What happened to my career?”
· Working harder to conceal disengagement
· Severe distractions
o Substance abuse
o Sexual indiscretions
o Unconscious career sabotage
· Bailing out
SS is quite unlike the other “outs”. This is not a once-in-a-lifetime event like a mid-life crisis. Those in the initial phases of SS have not been frozen out or marginalized – they reside in the inner circles. They rarely burn out – they see the impact of their work and welcome big demands. Their capabilities are not merely aligned with organizational purpose, they are admired and celebrated by superiors, peers and subordinates alike. In short, they are the superstars – they do not have the insecurity and inferiority complexes of the victims of the “outs”. And SS is more profound for the more proficient – it causes superstars to leave the fast track, drift from one job to another, and ultimately be among those highly promising men and women who never manage to achieve the positions and goals that friends and colleagues had assumed they would. For their organizations, this uncharacteristic behaviour from those least expected to disappoint comes as a shock. Getting them back in the saddle is expensive in terms of lost contribution, organization disruption and the price of counseling – but that’s the best-case scenario. The worst is surprise departures that rob organizations of their most promising talents.
The rest of the article is about recognizing and handling SS. I am going to move from the international corporate sector to the Indian development sector, as usual. We need to attract good people in and retain them to survive. Getting them in is comparatively easy – a nice pep talk about motivation, commitment, the need to give back to the country, etc., etc., tends to suffice. Retaining them is much more difficult, organizations in the sector have little knowledge of the frustrations such people face and are constantly and continuously surprised by the sudden departures of their prodigies. Making do with the ordinary is not enough – we need to engage with the brilliant to keep this sector vibrant and in tune with the challenges faced. Bleating on about their fickle nature, their capriciousness and their turbo-charged ambition is pointless. Maybe we can learn from those with experience in dealing with them, such as the international corporate sector.
I would like to conclude by returning to the subject of the ‘outs’. There is little understanding of this phenomenon within the development sector, especially the ‘outs’ faced by the brilliant. The first ‘outs’ occur before they actually land up at the NGO’s doorstep. Their parents freak out, and they contemplate a life out of pocket. Nothing new with the former, plenty with the latter! Salary differentials, even at entry levels, between the development sector and outside are now humungous. And today’s youth do not ask Mom and Dad for money, they prefer a bank loan for their post-graduation. And yet, despite poor salaries, despite EMIs, despite parental, peer and to-be-spouse pressure, and despite plenty of options, some brilliant people do come into the sector.
The mismatch between the organization’s requirements and the individual’s abilities invariably occurs from the beginning. A best-case scenario is when the recruit is given responsibilities that include the hurly-burly of dealing with communities (something that no post-graduate degree prepares one for), forcing her/him to sink or swim. If s/he sinks – good riddance! If not, you have somebody worth keeping. The worst is when the organization dumps all its English-writing requirements (proposals, reports, blah, blah, blah!) on this person – a quick flame out happens. Bosses, such people have not come to be glorified translators and candy floss for donor visits. The disservice you do to the sector far outweighs the immediate relief from meeting writing deadlines.
Empirical evidence points to the first burn out happening 2 to 3 years after the person joins. And while the results of our work are right in front of us, the other elements of the toxic triad are joined by a third – that city kids working in the boondocks miss the lights, sound and action and feel that life is passing them by. Cynicism and faultfinding set in, and they pick the wrong fights and create tension. What should the organization do? One, recognize it for what it is – a burnout and not some fundamental deficiency in either the individual or the organization. Two, provide space for introspective thinking (facilitate long term training, for example). Three, if it comes to losing the person, make sure that the process is pleasant and positive. Use your contacts within the sector to place the person suitably and ensure that your recommendations are not coloured by the recent past. And four, maintain the relationship – the brilliant will always rise in the world.
The most dangerous of the ‘outs’ happens to the brilliant in mid-life, because those that have stayed in the sector are now leaders and policy-makers. Many re-evaluate their objectives at this stage, weigh them up against financial and physical security concerns[2], and get psyched out. Organizations lose their way when this happens to the boss – the bricks and mortar, vehicles and salaries become more important than the communities served and problems addressed. The donors become kings, and others within the organization, especially the other brilliant, become threats. Everything works to enable this one person to stay in position. Vision, mission and values turn into more jargon.
Some survive the ‘outs’ and go on to do their best work later in their careers. But the unrealized potential and overall loss to the sector of those who don’t is huge. It would be useful for development organizations to work out ways of dealing with the ‘outs’.
[1] “Crisis at the Summit”, George Parsons and Richard Pascale, Harvard Business Review of March 2007
2. An old saying goes - men, when they turn 40, rethink the value of honesty, and women of virtue.
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