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ASIM BORAL

SONGSOPTOK THE WRITERS BLOG | 1/10/2015 |




CORPORATE CO OPERATIVE -A NEW KIND 
66 years have passed and Indian economy passed through lots of turbulence in the past. What was once a control economy changed to open economy at present. Thanks to Dr Manmohan Singh the then FM in 1991 and the great PM P V Narsimha Rao and their path breaking law of liberalization of Indian economy. What was once crumbled and stagnated business atmosphere has changed a lot with global exposure at present .There are at least 40 Indian Companies who are in fortune 500 lists. Global exposure has created huge employment in Narayan Murthy led IT sectors since 1991. There are 1000 IT companies working at present with more than 100 billion dollar business annually. India is now leader in drug --IT--Oil refinery--Milk - Steel business. Continuous M&A activities going on to penetrate not only Indian market but almost entire world market.

After so many achievement in so many sectors India still lagging in creating more employment .India need 5.3 cr employment by 2020. It seems Companies with similar products are regularly growing with more and more turn over in terms of value and quality as well but while analyzing the situation we find profitability squeezing year on year basis .Instead of finding the real reason Companies are resorting to M&A(Merger & Accusation)  activity regularly to penetrate and monopolize the market. Big Companies taking up the small companies and even Big companies also merging with another big Companies. This phenomenon of M&A activities without any clear intention and analysis creating confusion to management as well as workers. Last 3 years if we analyse further we can find even with M&A activity Companies profitability declining. Reasons are many -reasons are diverse -reasons are what we sometimes call vested interest also or some larger interest might be. I bet no one can tell why M& A in actuality and even Companies doing M&A is not clear of intention. Management of the Companies without finding any real reason landed up to mirage situation in desert and trying and finding  no solution to profitability on year on year basis becoming sick slowly and gradually rendering huge unemployment situation with in the merged situation . So something has to be done --some logical conclusion has to be done. We cannot allow a stable company suddenly going to sick but still we watch in disbelieve that lots of great Companies in the past became sick. Spice jet --King fisher Airlines like Companies are the glaring example. It may be mismanagement -It may be something others but Companies are getting sick .Sahara Companies are another example as how large numbers of investors employee got cheated by mismanagement of Sahara group of Companies. So there is no guarantee of profitability even after M&A of other companies.

So here my discussion or analysis is solely to find some solution which may change the business situation in India rapidly to some logical end. Instead of M&A,I believe same group of companies can work on Corporate Cooperative model with a new centralized marketing body which will create more employment. Someone may point out the Management issue may get diluted but Country like India with 1.2 billion people need co operative mode to provide more employment. See the AMUL Model and its success. So why not same group of companies making similar products from CORPORATE  COOPERATIVE in terms of Marketing the similar products. Let the sells take care by separate companies. In to-days competitive world same group of companies fighting each other for market share which effect their productions as well as quality also and profitability also in larger terms. I mean same group of companies with similar products mix only. We need to look a new generation Indianized system of marketing as looking in the past it happened that our Indian companies never develop their own marketing base and strategy or theory instead we borrowed Peter Duckker of western countries where socio economic culture is far different than Indian socio economic culture This kind of situation established as India is now flourished with so many MBA colleges with so called world class IIMs but I believe no one tries Indianized marketing system so far .We need a farmer from Rural India should give lecture to a IIM student with his Deshi dress and Raw words about marketing a product because India live on Rural. We are increasingly depending on ultra urbanization for development but never tried Rural as I believe Rural India is truly a gold mine and need to dug up .70 % people still live in Rural India who might have never heard of Indian economic liberalization -never heard of India is now truly a developed country -Never know how much world developed countries have interest in India. We need to develop more human in Rural India and we need to focus on that and making planning process truly on Rural basis. And then only India will develop further with more and more human development which in turn will create more products --more market --more employment. And captain of the Business world must now think differently and focus on Rural India with similar Agro based Industries on truly world class CORPORATE COOPERATIVE MODEL on AMUL line of action. 


[Asim Boral] 


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