The MBA Menace

B-School Campus Placement "Season" is over, Convocations are happening, and suddenly in the next couple of months, a few thousands of MBAs will spread out across companies and country to "manage" things as varied as people, products, machines, money, markets, etc.

About two years back, Henry Mintzberg had written this slightly strongly-worded article about the MBA Menace. I am sure not many will agree with him, but there is a grain of truth in what he is saying...

...I mean, if you are an MBA, about to join your first job, just think about it: how much do you really know about the company, its products/ services and the industry that you are going to join?

Read on, anyway...

Dear new MBA:

Congratulations! You have a sparkling new degree, highly prized in this world. You have learned a great many things about business. You have invested two years of your life, not to mention lost wages and a small fortune in tuition, in this impressive undertaking. As a result, you are fully qualified to go out and become a menace to society.

Granted, this isn't fully the fault of your school. Nothing personal, but full-time MBA programs by their nature attract many of the wrong people - too impatient and analytical, with little experience in management itself. These may be fine traits for students, but they can be tragically ill-suited for managers.

Conventional MBA programs then compound the error by giving the wrong impression of management: that managers are important people disconnected from the daily work of making products and producing services; that managing is largely about decision making through analysis; that managers pronounce deliberate strategies for everyone else to implement; and worst of all, that by sitting still in a classroom for a couple of years, you are now ready to manage anything.

Sure, you've taken courses called "management" and "strategy." But these were about looking in from the outside. The truth is, no one can become a manager in a classroom. Management is not a profession, nor is it science. It is a practice that depends mostly on craft and significantly on art. Craft is learned by experience. Art can, of course, be admired in a classroom - think of all the visionaries you read about in cases. But voyeurism is not management, either, nor does it develop creativity.

Take the case study. Now that is the "real world." Everyone debating what the CEO of XYZ Corporation should do next. Heady stuff. But what did you really know about XYZ? Did you even hear of it before you spent an hour on the case? Is that how we should be training our leaders: to read a few pages and then pronounce a future?

Sure, it's great to expose people to the experiences of others. Cases can do that well. But only for people who have had sufficient experience of their own - and then only to appreciate other situations, not to pronounce on them with the most superficial of knowledge.

Imagine dropping a young MBA student into a classroom of experienced managers. So long as the class sticks to theory and technique, the student would be fine. But as soon as the discussion turns to application, the student would be lost. In this respect, a classroom of such students is always lost. Organizations are complex phenomena. Managing them is a difficult, nuanced business, requiring tacit understanding that can only be gained in context. Trying to teach it to people who have never practiced it is worse than a waste of time - it demeans management.

So there it is: You've invested all this time and money... What are you to do now? Well, there is hope. You probably did learn a lot about business, and that's important - if you go into business. (Please stay out of government and the social sector; they have enough troubles.) If you are truly interested in management, as opposed to just fame or money, you may be ready to learn its practice. Find an industry you like, get a good job, and stick with it. The world doesn't need more case-study managers who flit from one industry to another. Prove yourself, and eventually you'll be tapped for a managerial position. That is when your management education will begin. Prepare then to learn about management. Live it. Experience it...

....The world desperately needs dedicated leaders. Not heroes on some kind of fast track, but decent human beings who engage themselves and others substantially. That could be you - if you can get past your MBA.

The Sensitization Challenge

One keeps on questioning one's motives...

For example, does it really make much of a difference writing about "poverty", "invisible India", "income divide" etc., in a forum that consists of a few handful million people in country of 1bn - who have access to the internet, and who read/write blogs...

To be more specific, does it change anything really?

I stumbled upon this interesting observation/ taxonomy - about Educating the Educated - from someone, who is "really" involved in these issues.

Here are the excerpts from the The Sensitization Challenge:

...."Voluntarism can also be termed as a study of attitudes. While there is much ado about the need of volunteering people's time and efforts towards social causes and societal development, we have in the past seen the percentage of responsiveness, indicating scope for change.

"25% aren?t even interested to know anything beyond their nose. For example - any person untouched by happenings beside him/her!

Out of the balance 75%,

- 40% are information seekers to wet their souls. They are overwhelmed listening to social issues and talk a lot about them, nothing beyond. For example, retired persons, especially from the Government, housewives and some academicians!

- another 30% would like to involve in " known" organizations, have elements of doubt and limitations of thought beyond "feeding" or helping ORPHANS! They eulogize the Sacrificers of Lives (demigods who run "charitable" organizations), visit these places and are satisfied with the beaming smiles from the "beneficiaries" and go back, hearts full. For example, individual donors.

- 20% progress to give time due to internally driven or externally driven motives, and study projects and their progress and support organizations and causes that fall in line with their thoughts. For example, funding organizations, Lions, Rotarians and their likes).

- 5 to 8 % are more keen, they start organizations themselves - a group of them, for instance, to promote and advocate a cause. They involve greater time, but in isolation work independently to cause pockets of change, with replicable programs and very little interfacing with Governmental or other Service Providing Agencies. For example youth groups, bank employees, corporate staff groups)

- Less than 2% feel the need for interdependency and networking. They understand the dynamics of social change and the possibility to work in tandem with existing systems. They are motivated when they hear about problems, and work within their area of control and influence to bring about model systems of interdependency in their community, tapping local resources, and utilizing it to develop their community with an idea of sustaining the growth, without "patronizing" and increasing the dependency factor. For example local leaders, Facilitating Organizations and individuals).

Yes, I can figure out that I belong to the "40% of the 75%"...

What about you!!??

Celebrating the "Catastrophic Success" in Iraq

The Iraq War was - and has been - in the words of those who prosecuted it, a "catastrophic success."

on the eve of the 3rd Anniversary of the Operation Iraqi Liberation, it is worth remembering the speech that the US President had made, while initiating the invasion:

"We are going to ignore the United Nations in order to make clear to Saddam Hussein that the United Nations cannot be ignored. We're going to wage war to preserve the UN's ability to avert war. The paramount principle is that the UN's word must be taken seriously, and if we have to subvert its word to guarantee that it is, then by gum, we will. Peace is too important not to take up arms to defend...

Further, if the only way to bring democracy to Iraq is to vitiate the democracy of the Security Council, then we are honor-bound to do that too, because democracy, as we define it, is too important to be stopped by a little thing like democracy as they define it.

Also, in dealing with a man who brooks no dissension at home, we cannot afford dissension among ourselves. We must speak with one voice against Saddam Hussein's failure to allow opposing voices to be heard. We are sending our gathered might to the Persian Gulf to make the point that might does not make right, as Saddam Hussein seems to think it does. And we are twisting the arms of the opposition until it agrees to let us oust a regime that twists the arms of the opposition. We cannot leave in power a dictator who ignores his own people. And if our people, and people elsewhere in the world, fail to understand that, then we have no choice but to ignore them..."

of course, GW Bush never made such a speech!!!... but this, in essence, was the "logic"
- of the "shock and Awe",
- of deaths of tens of thousands of liberated iraqis,
- of invisible body-bags,
- of Abu Ghraib,
- of torture and abuse,
- of massive corruption by the occupiers,
- of squeezing one's pound of flesh,
- of holding a populace hostage,
...of spending $1trillion to demolish a country with a GDP of less than $40bn, etc. etc.)

War as Photo-Ops

War, as some may have noticed, has lately become a booming entertainment industry, a part of "reality TV".

Here is one example - View the Photo-Essay - and how it failed on the box-office):

When the Operation Swarmer was launched jointly by the US-Iraqi forces on March 16th ("to clear a suspected insurgent operating area northeast of Samarra", Iraq), it was "billed" as the "largest airbourne operation since 2003". The star attraction was the scale: 50 aircrafts, 1,500 troops, 200 tactical vehicles (and hordes of "embedded" journalists and camera crew).

The target population (not of the operation, but of the viewers) was clearly defined. As one observer noted: "It's a boost here at the home front because it shows American forces being proactive and it shows us using high technology - which we like - instead of getting blown up in humvees - which we don't like. It was good television, and it's been a while since we've seen good television coming out of Iraq."

Another said: "The timing may be based on demonstrating to the bad guys in part but also to the Iraqi elected officials - who are having a hard time making a government - that the U.S. is still there, is going to carry out operations and is going to try and create stability."

White House spokesman Scott McClellan described this operation as just one of a series of offensives aimed at defeating the insurgency: "There have been a number of operations that have been undertaken over the course of the last several months to really go after the terrorists, and the Saddam loyalists, who want to return to the past of oppression and tyranny. So this operation is part of our ongoing efforts to move forward on the security front."

No wonder, virtually all media channels were intimated and covered this high-profile event.

However, what actually happened was an anti-climax - a pretty bad script after so much media hype:

"Four Black Hawk helicopters landed in a wheat field and dropped off a television crew, three photographers, three print reporters and three Iraqi government officials right into the middle of Operation Swarmer. Iraqi soldiers in newly painted humvees, green and red Iraqi flags stenciled on the tailgates, had just finished searching the farm populated by a half-dozen skinny cows and a woman kneading freshly risen dough and slapping it to the walls of a mud oven.

The press, flown in from Baghdad to this agricultural gridiron northeast of Samarra, huddled around the Iraqi officials and U.S. Army commanders who explained that the "largest air assault since 2003" in Iraq using over 50 helicopters to put 1500 Iraqi and U.S. troops on the ground had netted 48 suspected insurgents, 17 of which had already been cleared and released. The area, explained the officials, has long been suspected of being used as a base for insurgents operating in and around Samarra, the city north of Baghdad where the bombing of a sacred shrine recently sparked a wave of sectarian violence.

But contrary to what many many television networks erroneously reported...there were no airstrikes and no leading insurgents were nabbed... What’s more, there were no shots fired at all and the units had met no resistance, said the U.S. and Iraqi commanders.

...Before loading up into the helicopters for a return trip to Baghdad, Iraqi and American soldiers and some reporters helped themselves to the woman’s freshly baked bread, tearing bits off and chewing it as they wandered among the cows. For most of them, it was the only thing worthwhile they’d found all day."

...er, if one may add: They also did not find any WMDs!!!

Moral of the Story: Next time you view the promo of an up-coming war (e.g., a speech by some world-leader), be sure who scripted it.
:0)

How to Increase GDP: Learning from Indian Budget

Last week, during the Budget Session, the Indian Finance Minister, Mr P Chidambaram, announced that the Indian GDP registered a growth of 7.5% during 2004-05, and is likely to grow at the rate of 8.1% during 2005-06.

This was a great news!!! - The Sensex jumped beyond 10,000 mark, the analysts commented on how India is (almost) catching up with China, Indian media had a hay-day with headlines, and the captains of Indian industry (self)-congratulated the government (since the gap between govt and industry is decreasing)....

In any case, to learn how one can sustain this kind of growth rate - in fact, to move to a growth rate of 10% - one must look at how we achived this.

For instance:

The government shifted the base year for calculating the GDP growth from 1993-94 to 1999-2000. This increased the GDP growth from 6.9% to 7.5%.

The weightage of certain fast-growing sectors in calculating the GDP was increased (e.g., for trade, hotels and restaurants, it was increased from 14 to 14.2; for finance, insurance, real estate and business services from 12.5 to 13, etc.)

New economic activities from the unorganised sector (e.g., milk production from camel, goat and buffalo; production of toddy and betel leaf; production of salt from sea water evaporation, meat production from unregistered slaughter houses, etc.) were included in calculating the GDP for the first time.

etc.

As the FM said that "I believe that growth is the best antidote to poverty."... we have fianlly found a quick and sure formula for economic growth and eradication of poverty!!!!

Er... lest one feels that there is anything exceptional and "wrong" about such "creative accounting", let us also have a look at how India's agricultural GDP showed a 9.1% growth during 2003-04 (i.e., when India was "shining";0):

In 2003-04, India produced 212mn tonnes foodgrains. This was a great jump from 2002-03, when the foodgrain production was 174.2mn tonnes, and a cause to celebrate.... till one noticed that actually, 02-03 was a bad year due to monsoons and that India had produced 212mn tonnes of foodgrain in 2001-02 as well!!!

For more such "economic miracles", have a look at:
A World Deceived By "Numbers/ Facts"
Governments as "Enrons"
The Real "Miracle" of Chinese FDI Figures
FDI: China and India - Just a Difference in Definition!!!

War Made Easy: Step-by-Step Guide to Attack Iran

I had written about it a number of times earlier, e.g.,
Collapse-of-Dollar-Economy,
New-"Axis-of-Evil"...
Invade!-But-At-Least-Change-the-Script",
etc.


But there is reason to come back to it once again, since this is March, and three important - and interconnected - events are going to unfold this month.

1. On March 6th, IAEA will again meet to decide "what to do with Iran?". Since, it is obvious that they will refer Iran issue to UN Security Council, there is a need to understand the farce around the "concern of the international community" about the nuclear Iran.

2. On March 20th, Iran is planning to open its oil bourse, which will compete the two existing oil bourses - New York's NYMEX and London's International Petroleum Exchange.

3. From 23rd March, the Federal Reserve will stop publishing its M3 monetary aggregates - which gives the figures about dollars circulating in global market.
http://www.federalreserve.gov/releases/h6/discm3.htm

Perhaps to understand this linkage, one must look at a significant (but under-reported) event that occured on the floor of US House of Representatives, a few days back. For the first time, someone from the mainstream political domain (i.e., from the "Free West", "International Community", "Civilized World", etc.) clearly articulated what was otherwise often discussed in the alternative media - namely, there is a tacit connection between the growing US debt (not just deficit), threat to the the dollar supremacy, and the increasingly invasive US foreign policy... And that the Dollar Hegemony is nearing an end (or at least, under a killing threat)

It was the first time, an American politician, openly brought the issue of the threat to the "Dollar Hegemony" from the "Iranian Oil Bourse" (though, once again, this speech given by the Texan senator, Hon. Ron Paul was conveniently ignored by the MSM).

You can read the whole text at The End of Dollar Hegemony. Here are some key excerpts about why US will find justifications to attack Iran (directly, or maybe through Israel):

"...In November 2000 Saddam Hussein demanded Euros for his oil. His arrogance was a threat to the dollar; his lack of any military might was never a threat. At the first cabinet meeting with the new administration in 2001, as reported by Treasury Secretary Paul O'Neill, the major topic was how we would get rid of Saddam Hussein - though there was no evidence whatsoever he posed a threat to us.... It now is common knowledge that the immediate reaction of the administration after 9/11 revolved around how they could connect Saddam Hussein to the attacks, to justify an invasion and overthrow of his government. Even with no evidence of any connection to 9/11, or evidence of weapons of mass destruction, public and congressional support was generated through distortions and flat out misrepresentation of the facts to justify overthrowing Saddam Hussein.

There was no public talk of removing Saddam Hussein because of his attack on the integrity of the dollar as a reserve currency by selling oil in Euros... Within a very short period after the military victory, all Iraqi oil sales were carried out in dollars. The Euro was abandoned.

In 2001, Venezuela's ambassador to Russia spoke of Venezuela switching to the Euro for all their oil sales. Within a year there was a coup attempt against Chavez, reportedly with assistance from our CIA....It's become clear the U.S. administration was sympathetic to those who plotted the overthrow of Chavez... The fact that Chavez was democratically elected had little influence on which side we supported.

Now, a new attempt is being made against the petrodollar system. Iran, another member of the "axis of evil", has announced her plans to initiate an oil bourse in March of this year. Guess what, the oil sales will be priced Euros, not dollars."


But if this is true, then what about the "Nuclear Ambitions" of Iran?

This "threat to the global peace" that is being highlighted as much by the politicians and MSM these days, as were the hidden WMDs that led upto US invasion of Iraq. In fact, the parallels between the build-up propaganda to Iraq invasion, and the current drumbeat about the "Iranian Nuclear Ambitions" are remarkable.

But coming back to Iran's nuclear capabilities, some facts:

1. According to the the US National Intelligence Estimates report (which was ordered by the US National Intelligence Council), Iran is at least a decade away from developing nuclear weapon. It is also interesting to note that unlike in case of Iraq - since it turned out to be rotten last time - this time the Bush administration has not been attributing the "Iran threat" to its "intelligence" (yes... pun is also intended:)
See:
Iran Is Judged 10 Years From Nuclear Bomb

2. According to an IAEA Update document, dated January 31, 2006: "Iran has continued to facilitate access under its Safeguards Agreement as requested by the Agency, and to act as if the Additional Protocol is in force, including by providing in a timely manner the requisite declarations and access to locations."

This update from the IAEA Dy. Director General was shared to all just a week before 30/37 IAEA member nations "ratified" the US government propaganda - about Iran's "non-compliance of its obligations", "clandestine nuclear weapons program", etc. - as a fact.

In fact, even the earlier reports from IAEA Director General also communicate the same message: "to date, there is no evidence that the previously undeclared nuclear material and activities referred to above were related to a nuclear weapons program" (Nov 2003, Implementation of NPT Safeguard Agreement in Islamic Republic of Iran)
and
"all the declared nuclear material in Iran has been accounted for, and therefore such material is not diverted to prohibited activities" (Nov 2004, Implementation of NPT Safeguard Agreement in Islamic Republic of Iran)
See:
Developments in the Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran and Agency Verification of Iran’s Suspension of Enrichment-related and Reprocessing Activities (Update Brief by Dy Director General, IAEA)

3. From whatever one can understand about the technology for producing nuclear weapons (not my area of competence at all), one needs thousands of high-grade uranium centrefuges, that can spin at a speed of 800-1200 revolutions/second witout breaking down, to enrich weapon-grade uranium; Iran has just about 160 or so, and those too crude ones. Iran also does not produce uranium hexafluoride gas of high quality which is required to run its crude centrifuges.
See:
Iran 'years from nuclear bomb'
Nuclear Poker Over Iran


But Why Would An Oil-Rich Nation (in fact, one with second largest reserves) Invest In Developing Nuclear Energy - Unless It Wants To Make Nuclear Weapons?

Plausible as this argument looks, like most such reasons that are made to ultimately justify a war, it hides more than it says.... Facts, after all, should never stand in the way of empire-building.

An article written by Prof Mohammad Sahimi (Prof & Chairman of Chemical and Petroleum Engineering, University of Southern California, Los Angeles) in 2003 lists out some useful facts to understand Iran's energy sector and needs (and which rarely find their way in MSM, politician's speeches, or public discourse):

Iran's Nuclear Program. Part II: Are Nuclear Reactors Necessary?

Most of Iran's 60 oil fields are old, and need to repairs, upgrading and repressurizing to remain viable. Even though it is large producer of oil and gas (about 4mn barrekls/day), it has not been able to reach its pre-revolution production level of around 5.5-6mn barrels/day. This would require an investment of around $40 billion over next 12-15 years (Getting such investments a bleak possibility for Iran, since US had imposed economic sanctions after the '79 revolution).

On the other hand, like most other developing nations, Iran's energy needs are increasing. Its population has more than doubled since 1980 (from 32mn to 70mn), and during the same time, its total energy consumption increased more than 3 times from 1.6 quadrillion Btu (quads) in 1980 to more than 5.5 quads at present.

Iran has a present installed electrical capacity of around 20,000 megawatt. However, it's annual growth in demand is 5-8% - which means that by 2010, it will need another 7,000-megawatt of electricity.

Since a large part of this electricity requirement comes from Iran's consumption of its own oil and gas production, Iran's own consumption of oil has been growing at a rate of 8%/year since the early 1990s. If this trend continues, Iran will, paradoxically, become a net oil importer by 2010. That, to say the least, will be a catastrophe for a country that relies on oil for 80% of her foreign currency and 45% of her total annual budget... If that happens, where will Iran get money to build its infrastructure, feed its people, manage the other parts of economy, etc.

There is also this basic issue of Energy-Economics-101. To paraphrase Iran's former ruler, Shah Mohammad Reza (a good friend of US then, who was ousted), a barrel of oil is too "precious" to be used for generating electricity (in fact, that is why US had supplied Iran the uranium enrichment technology back in 1974).

To put is simply: if one can make electricity from other sources, then the oil & gas can be used for more value-added products - that range from plastics to cosmetics... Iran, presently, produces around $2.7bn/year worth of petrochimical products, and if it reduces its reliance on oil & gas for its electricity requirements, this can be a huge source of revenue for the country.

To put this in context, a fact often not mentioned, Iran's known uranium reserves can produce as much electricity as 45bn barrels of oil - that is more than 50% of Iran's known oil reserves of 96bn barrels of oil. "In other words, if we can extract all of Iran's known oil reserves (a remote possibility!) and use about half of them just for producing electricity, we will generate as much electricity as what Iran's presently-known uranium deposits can produce! It would therefore be absolutely foolish not to do this!"

And lastly, there are environmental costs of using oil to produce electricity (even if one uses gas/CNG). The carbon emmissions - a major culprit in air pollution - in Iran have increased from 33mn metric tons in 1980 to 85mn metric tons... There are 17,000 deaths/annum from air pollution in Tehran alone (apart from an increase in asthma, heart and skin ailments)... Fortunately, unlike the brave new privatised/corporatised world of US economy, the healthcare costs are still considered to be a responsibility of the state in Iran - and so, it is natural for the state to consider its overall costs...

It is in this context that in 2003, one of the IAEA reports noted:
"According to all the surveys performed in power sector of Iran, nuclear option is the most competitive to fossil alternatives if the existing low domestic fuel prices are gradually increased to its opportunity costs at the level of international prices IAEA Report on Energy & Economics in Iran."


If So, Why Would We Have Another War - This Time, Waged on Iran - In The Coming Months/Weeks?

Iran, obvioulsy, is not a military threat to any nation. But it sure is an economic threat to US.
then, US govt. has no other alternative but to invade/attack it, if it has to save its economy.

Reasons:

The global supremacy of US$ - and therefore, of US economy - is not because of the "economic fundamentals". US$ is, after all, a "fiat currency" backed by "nothing"!!!

The value of US$ is because it remains in high demand globally. The global demand is fuelled by the fact that world-wide oil is bought and sold in US$. The two oil exchanges - NYMEX & IPE - deal in US$, and are effectiely owned by US. And therefore, all countries buy US$ for their foreign currency reserves.

To buy the US$, countries produce and sell "something". In contrast, US only has to print some greenbacks to achieve similar ends (of course, it maintains control of the supply of US$ in the currency market; too many US$ floating around will decrease its value).

On 20th of March, when Iranian Oil Bourse opens, it will trade denominate oil in Euro, and not in US$.

If this happens, the magic of US$ will get eroded, since many countries will start offloading US$ for Euro. The more number of countries sell the US$, the lesser will be its value.... It will be kind of "bear-run" on the currency market - which, some would have noticed, is essentially a speculative global casino... only 2% of FX transactions relate to any "real" economic trade of goods or services, we are actually living in a global casino, where 98% transactions are speculative

Ceasing the publication of M3 Monetary Aggregates from March 23rd is Federal Reserves' way to slow or stop the bear-run. If people are not aware how many US$ are being sold in the market, they will have no way to decide its "market value".

Ensuring that Iran is referred to UN Security Council will be the other US initiative, which will lead it one step closer to attack Iran with a semblence of legitimacy (though, unlike in case of Iraq, this time there is less chance of an invasion, but greater chances of an air attack on Iranian facilities - either by US or by Israel - as an "act of self-defense"!!)