A Sino-Scottish Football Proposal

Readers of this blog will know of my interests (and soft spot) for all things Scotland. I previously wrote a brief ten-point approach to revitalising Scottish Football.

In the time that has elapsed since that article was written, we’ve seen a robust approach to football development in China. Now, football has always been popular in China but the attempts towards establishing China as a footballing powerhouse have been sporadic at best. However when President Xi Jinping became the President of the People’s Republic of China, it all changed.

president-xiIt has to be noted that President Xi is a huge football fan and he has publicly outlined his vision for China to one day host the World Cup and to then win it! In 2015, a 50-point plan was announced by the Central Planning Committee (of the Chinese Communist Party) to overhaul Chinese football and it was overseen by President Xi.

This desire for China to be a football giant isn’t a new one. The other Chinese leader in the past who had huge dreams for Chinese football was Deng Xiaoping, the architect for China’s economic liberalisation but his priorities had to be primarily on economic and social development.

Chinese football fans are a hugely passionate lot – I recall watching the Singapore Armed Forces FC (SAFFC) playing the Chinese Army Ba Yi team in 1998 at the old Kallang Stadium in Singapore and it was sellout turnout that was half Singaporean and half Chinese (despite the fact it was held in Singapore!) and the passion and energy was fantastic.

In fact, when Stockport County (from the Second Division) did a tour in China, their matches were attended by over 20,000 fans per game (more than five times their home average home attendance!).

The Chinese Football Association Strategy

The Chinese Football Association have clearly spelt out their desire and strategy to be a ‘world football superpower by the middle of the century.’

In an effort to match the strategy, they have embarked on a five-pronged approach towards delivering their vision.

1. Grassroots training, academies’ development and training

The Chinese investment into building the game at grassroots level is absolutely staggering. According to a memo sent out by the Ministry of Education in China on July 2015, they have identified 4,755 schools as specialist footballing academies.

Last year, the world’s largest (and arguably the most expensive) football academy – the Evergrande Football School – opened in Guangzhou, a Southern Chinese province. The school built in 10 months cost over $185 million. The school also has partnered with Real Madrid to provide the trainers and coaches to help develop about 3,000 young Chinese footballers.

Other football clubs, including Manchester City, and ex-players such as Luis Figo and Michael Owen have also established their football academies across China.

The Chinese government have also expressed a clear commitment to include football as part of the overall school curriculum.

This is part of the overall goal to ensure over 50 million children and adults play football regularly by 2020 and to develop the critical mass of high-quality players required to develop a world-class team.

2. Providing Chinese players with international experience and exposure

There have not been as many high-profile Chinese players in European leagues. The two most recognisable players were Sun Jihai and Li Tie who played for Manchester City and Everton respectively. Unlike South Korean and Japanese superstars (such as Park Ji Sung for Manchester United, Hideotoshi Nakata, Shunsuke Nakamura for Celtic, et et), Chinese players have not been able to shine at the top European leagues.

There is now concerted effort to get Chinese players playing in the top European leagues to get the international exposure. There is a reasonable expectation that this will not only allow for top players to develop their craft further but also help China in their international competitions.

It is to be noted though that Chinese players turning out for British teams saw over 350 million Chinese viewers becoming more interested in British football!

3. Ownership and partnerships with globally-renowned football clubs

The top Chinese companies are now investing, partnering or buying outright top teams across Europe. From Atletico Madrid to Inter Milan to Wolverhampton Wanderers, we see Chinese ownership. Chinese consortiums are also partners in other clubs such as Manchester City. This is part of a wider effort not only to drive economic benefits that come from effective management of football teams but to also learn and adopt best club management practices. These best practices will ultimately support better footballing management and establishment of world-class processes and procedures required to develop a football network back in China.

4. Bringing world-class managers and trainers to China

The top teams in the Chinese leagues are now bringing in expert football managers and coaches with very impressive pedigrees. The likes of Luis Felipe Scolari, Sven-Goran Erikkson and Dan Petrescu have come to Chinese leagues and have helped raise the level of the game in China.

5. Signing high-quality talent and superstars from overseas to play in Chinese leagues 

In the recent year we’ve seen the financial muscle of Chinese football clubs (supported by the richest Chinese companies and their billionaire owners, including Jack Ma of Alibaba fame and Wang Jianlin, owner of Dalian Wanda and China’s richest man) outbid top European clubs for the services of world-class footballers. From Ramires (£23 million), to Alex Teixera, to Hulk (for £47 million), to Carlos Tevez (being paid an estimated £20m per annum), we’re seeing a very deliberate policy of bringing the best players to China in an effort to drive up the overall quality of Chinese players in the Chinese League through better exposure to top talent.

What all of the above demonstrates is a clear laser-like focus on the Chinese government ambitions of winning the World Cup in the coming decades. We see the ambition being matched with money, political support and commitment from across all sectors (education, business and policy) – and this is just the start. 

One Area For Further Development

There is, however, one area which is still missing. Chinese players need to be playing against quality opposition week-in, week-out. Whilst the youth and grassroots development is a step in the right direction, it is going to take a decade or more before there is a crop of players who will provide the quality opposition. Having a few superstar players (limited to three foreign players per team in any event) again is not enough. Similarly, having a couple of world-class coaches is not going to be enough.

The Chinese league needs to have complete teams with quality players who can provide the Chinese players with the type of competition and exposure that will allow them to make step changes in their development and progress.

This is where Scottish football comes in!

What Could This Mean For Scottish Football?

The Scottish FA have provided for development loans to help build the youth football framework across Scottish football clubs. The Scottish FA have also provided financial incentives to Scottish football team for performance-based outcomes which include number of under-21 players in the first team.

Alistair Gray, in a BBC interview, also highlighted the quality of youth players from Scotland and the need for the players to have more competitive game time to further develop their capabilities.

The Proposal

My proposal is that the Chinese Football Association allow for the Celtic U23 and Rangers U23 participate in the Chinese Super League and increase the size of the league from 16 to 18 teams.

What would this mean for Chinese football and the players in the league?

  • It means that you will have the top Chinese teams playing against the cream of the crop from Scottish Football , against young players who are technically very competent.
  • It will also allow for Chinese teams to get used to the pace of football Scottish teams can provide and help build the overall footballing game intelligence for Chinese league players.
  • This will allow for a much more holistic development of Chinese players and get them acclimatised to playing against different styles and against much higher overall quality players.
  • It could also lead to a more formal exchange programme between Chinese league players and Scottish football clubs and also promote greater youth development through these exchange programmes.

There are significant benefits for Scottish football as a result of this proposal:

  • It will mean the top youth players from Scotland will have the opportunity to play against an up-and-coming group of Chinese players and further hone their skills.
  • It will also create greater interest in Scottish football by Chinese fans and will spur a greater following. It will help expose Chinese football fans to the intrigues and entertainment of Scottish football. The history of Scottish football, its lore and fables – from the Lions of Lisbon, to the history of the Old Firm derbies,   Archie Gemmill’s wonder goal against the Dutch in the 1978 World Cup. This will allow for the Scottish Professional Football League to negotiate better rates for the TV deal in China in the future. Imagine a world with a billion more interested Scottish football fans!
  • An Old Firm derby in Shanghai – the opportunity to recreate one of the world’s most historic football rivalries, creating an interest in the history and ethos of both Celtic and Rangers for an entirely new audience remains a very tantalising prospect.
  • It also provides a fabulous opportunity for Scottish youth to experience a year out in China, learning more about the culture and experiencing life from a different lens and perspective. This can only further build the bridges between cultures.

Ultimately this initiative will lead to greater awareness and relationships between both China and Scotland. It also becomes a fantastic opportunity for Scotland to showcase her natural beauty, the culture and traditions of Scotland and help increase the overall tourism and investment by Chinese.

It will also help the Chinese sports authorities get one step closer to meeting the Chinese leadership’s ambitions of one day winning the World Cup. Now, that’s an offer that will be hard to refuse.

 

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FW: INCOME INEQUALITY RE: MAJOR PROBLEM

 

“I believe this [income inequality] is the defining challenge of our time.”
Barack Obama (2013)

 

“One of the leading economic stories of our time is rising income inequality, and the dark shadow it casts across the global economy.”
Christine Lagarde (2015)

 

There is a clear recognition of the risks, dangers and the pain which income inequality imposes on society. Despite the recognition, it is a problem which seems to constantly be forwarded on to successive generations to resolve rather than finding a decisive set of solutions.

We will all do well to pay heed to the US Senator John Sherman who in 1890 when he introduced his landmark Sherman Antitrust Act said that he sought to “put an end to great aggregations of capital because of the helplessness of the individual before them” and also because he fundamentally believed that amongst all of the nation’s problems, “none is more threatening that the inequality of condition, of wealth and opportunity.”

So why does inequality matter? Why is it important that we all strive towards resolving it? Societies that are hugely imbalanced and unequal ultimately become fractured which in turn lead to painful social and economic consequences that affect everyone. Neither the rich nor the poor will be able to avoid the huge social costs of a fractured society.

The stark facts

  • 62 of the richest people in the world own what the bottom 50% of the world’s population own.

  • 1915: The richest 1% of Americans earned 18% of the national income.
    1930s to 1970s: The share plummeted and remained below 10%
    From the 1970s: The share has increased to almost 30%

  • 1980: The top 0.1% wealthiest Americans controlled about 9% of all household wealth
    2015: The top 0.1% own 22% of all household wealth.

  • USA: The top 1% of America control 40% of America’s wealth

  • Germany: Poverty has risen by half since 2000.

  • 1965: CEO pay at the largest 350 U.S companies was 20 times as high as the pay of the average workers
    1989: The figure is 58 times as high
    2012: The figure is now an astounding 273 times as high.
    (It is worth bearing in mind that Peter Drucker argued that the pay ratio between the top executive and the humblest worker should be no greater than 20 to 1.)

  • OECD: The gap between the rich and poor is now at its highest level in OECD economies in 30 years according to a report produced in 2014. The overall increase in income inequality has been driven by the richest 1%.
  • 2008: The United Nations University (UNU) and the World Institute for Development Economic Research (WIDER) estimate that the global Gini coefficient (a measurement of inequality between 0 – representing complete equality and 1 – representing complete inequality) was 89.

    An alternative way to interpret this is that in a population of 10 people, if one person had $1000, the other nine have only $1 each.

  • 2014: The Credit Suisse Global Wealth report estimates that that the richest 0.7% (who hold over US$1 million in wealth) held 44% of the global net worth.

Some context

The economic success stories of many countries hides a dangerous truth – that a significant majority of economic gains are going to those at the very top of the income distribution whereas those lower down have seen real incomes stagnate or diminish.

This has in turn perpetuated further inequality as those in a position of privilege often use their wealth and influence to shape policies that further increase their concentration of power. These policies have not necessarily been in the interests of those lower down the income ladder.

A research conducted by Martin Gilens, a political scientist at Princeton, lends credence to the notion that the US government responds more positive to the most affluent ten percent of Americans whilst “the preferences of a vast majority of Americans appear to have essentially no impact on which policies the government does or doesn’t adopt.” (A video of Gilen’s lecture can also be viewed here.)

The erosion of the social compact

This wasn’t always the case though. Whilst there has always been inequality, it has never been to this extent or been as pervasive. There was also more concerted effort to reduce the level of inequality and dampen its deleterious impact on society.

The experience of the First World War revolutionised American attitudes towards taxation and redistribution of income. When the War Revenue Act of 1917 was passed, there was talk of “conscription of income” and “conscription of wealth” at a time when young men were enlisting en masse. “Let their dollars die for their country too,” one congressman said. The call for fiscal patriotism helped legitimate the progressive income tax in the United States, and by 1944 the top marginal rate had risen as high as 94 percent.

Across Europe, a fear that the lack of reform could lead to social and political turmoil and the horrors of two World Wars meant that policies such as social insurance, minimum wage, a strong welfare state and progressive income tax were implemented leading to more egalitarian societies and economies.

inequality 2The experiences of global ears produced visions of a social bond holding countries together and nurtured the notion that every single person owed a debt to the welfare of the broader community and society.

However since the 70s, the disappearance of these conditions has meant that the support for egalitarian public policies has also diminished.

We now live in a world where even high skilled jobs are being commoditised so that even highly educated workers are not making sufficient progress as gains in economic growth are limited to a very elite group of financiers, entrepreneurs and managers. In the past only unskilled workers lost jobs to automation, now even highly skilled occupations are at risk with the advancement of artificial intelligence, robotics and automation.

The social structure of Silicon Valley provides us with an instructive view of the future: One where expert systems have replaced the majority of people and a tiny but well-remunerated minority direct the economy whilst the majority exist to serve them alone.

The conflict is no longer just between the working class and the middle and upper classes – it is now between a tiny elite and the great majority of citizens. As the majority develop a sense of common interest, or what Marx may have termed ‘class consciousness’, the need to resolve inequality will become more acute as the resentment of it intensifies.

 

What happens when income inequality starts to become entrenched?

  • Health: Societies that are more unequal tend to have lower life expectancies, higher infant mortality, higher levels of infant mortality and high levels of diseases and conditions such as HIV/AIDS.
  • Human capital development: As inequality rises, scores on the UNICEF index of child well-being become significantly worse. Literacy rates are also lower and youth unemployment also becomes a major issue. A higher level of equality also leads to a greater level of innovation as a result of greater access to opportunity.
  • Social mobility: Inequality restricts social mobility – equality of opportunity is enhanced by greater income equality. Reduced social mobility further exacerbates income inequality and this becomes a vicious spiral from which an effective functioning economy becomes more and more difficult.

    inequality1 2
    (C) Walt Handelsman
  • Economic progress and stability: An IMF report highlights that by reducing inequality and bolstering longer term economic growth are “two sides of the same coin.” In both rich and poor countries, inequality is strongly correlated with shorter spells of economic expansion and growth over time. Unequal economies are also more susceptible to severe boom-and-bust cycles leading to greater volatility and crisis. Extreme levels of income inequality depress economic growth. An OECD report estimates that inequality has had a cumulated loss of GDP across OECD economies of 8.5% over twenty-five years.
  • Social challenges and issues: Inequality breeds corruption. Unequal societies also lead to greater economic instability. If one considers the root causes of the Arab Spring, the lack of economic opportunity or equality is one of the main drivers leading to revolt.

A blueprint for change and resolution

The solution and change required for income inequality is not a zero-sum game. There will be those who are impacted more than others, but it is essential in calibrating the world in a more equal way.

It is very easy to be dangerously complacent and ignore equality, but chronic economic inequality hurts everyone, both the rich and the poor.

Resolution of a problem like inequality requires a revolutionary approach. We need to accept a fiscal revolution or risk a social one.

I’ve highlighted below briefly some key practical steps that need to be considered as we seek an urgent resolution to the problem of income inequality.

  1. Tax reforms – Income taxes need to be more progressive (the way they were previously in times of greater equality). There needs to be a reform in the way the transfer of wealth is also taxed. The OECD has suggested that attempts to reduce inequality tax and transfer policies will not harm growth as long as the chosen policies are well designed and implemented. The OECD further argues that redistribution efforts should focus on families with children, on the youth and the improvement in human capital investment through the promotion of skills learning and development.
  1. Continued focus on economic growth and employment – Policies targeting economic growth need to continue as growth ensures jobs are created and ensures employment. Employment will support social mobility which is essential to the reduction of inequality.
  1. Ensure emphasis on social mobility – Social mobility is a key driver towards the reduction on inequality. Emphasis on education, skills learning and development is vital to support social mobility.
  1. Support small savers and small businesses – Policies should not be tilted towards just merely taxing the rich but also be aimed at increasing the wealth of small savers and businesses. For instance we should consider the introduction of accounts for small savers and businesses that guarantees positive returns in excess of inflation. It is also a widely observed phenomenon that lower income families borrow more to support their consumption and this in turn creates a systemic risk.
  1. Enhanced social policies – Governments and policy makers should also consider more directed interventions to enhance the social conditions of lower income families. For instance, in the UK, the Child Benefit offers a weekly allowance to parents for every child they raise. The transfer could be better targeted by making the income taxable as personal income, which will reduce the size of the benefit for those in higher tax brackets or who do not have face any other mitigating circumstances. In the UK, child poverty has dropped sharply whilst in the USA; it has risen by a third between 1969 and 2013. A child-benefit programme will help make a major dent in child poverty and also represent a powerful investment in the future. Introducing a child-benefit program in the US will make a major dent in child poverty and represent a powerful investment into the future.
  1. Minimum wage – Governments should also take an active review of the minimum wage policies in their countries and recalibrate them to local conditions. There is always a temptation to keep minimum wage lower because neighbouring countries are keeping theirs lower, but this beggar thy neighbour policy will not benefit anyone in the long run. Countries that make the effort to ensure greater equality will be healthier in the long term.
  1. Automation and technological change – Governments should take an active interest in the direction of technological change. It is mostly governmental grants and labs that are responsible for the underlying research that has led to the progress in automation and technology and they therefore have the right to ensure a clear review is undertaken to mitigate the social impacts of technological change through appropriate fiscal and taxation policies.

It is crucial that we as a collective rise up to face the challenges of income inequality and work closely to create a more equal society. The corrosive impacts of inequality will affect us all and the sooner we can find solutions to achieve an equal society, the better, for all.

e-Learning and the needs of developing countries

Having had the pleasure of speaking at the UNCTAD14: e-Learning – Leapfrogging Skills Development session on the 21st of July 2016 in Nairobi, I am enclosing below some of my thoughts on e-Learning and the needs of digital countries in terms of knowledge development and how to best address them.

Details of my fellow participants can be found here.

The full video of the session can also be found at E-learning: Leapfrogging skills development from TrainForTrade on Vimeo.

Introduction

ACCA, as the global body for professional accountants , has within its DNA embedded the notion of delivering public value and to also advance the science of accountancy.

As an organisation committed to innovation and providing opportunity, it was only apt that we became the first professional accountancy body to develop ACCA-X, a comprehensive suite of learning modules towards financial literacy, accountancy and business skills using MOOC (Massive Open Online Content) learning through an exciting partnership with edX and Epigeum .

In the 12 months since launch (from July 2015), there have been over 120,000 learners from over 210 countries who have participated and engaged with the courses and started their journey towards a better understanding of accountancy, business and finance.

 

Four key areas for developing and transition economics to consider for e-Learning knowledge development:

  1. Tackling the employability gap

  2. Building the foundations for data-led learning

  3. Capacity building for educators and policy makers

  4. The value of partnerships

 

Tackling the employability gap

  • Employability is one of the key policy issues of our times.
  • Linking education to employability and improving overall efficiency and productivity is something policy makers and politicians are grappling all over the world.
  • Interestingly, UNCTAD Secretary General Mukhisa Kituyi highlighted in a high level policy roundtable during the first day of the UNCTAD14 conference that employees in developing nations only have an output that is 10% of their counterparts in the EU.
  • It is important to note though that employability is an issue that afflicts both developing and developed nations equally. It is a problem in India (with increasing numbers of graduates unable to find relevant jobs); it is a problem in China (with the numbers of graduates increasing from 1 million in 2000 to 6.1 million in 2011); it is a problem across the EU with over a fifth of 15 – 24 year olds unable to find gainful employment. Further details can be found here.
  • Reasons for this employability gap:
    1. mismatch in skills required by industry and what they are being trained towards;
    2. lack of clarity of skills needs and dialogue between educators and industry;
    3. education and training style (focus still on role learning – does not foster mental agility and innovative flair)
  • This is where technology and e-Learning becomes an enabler to helping fill the gap between education and technology:
    1. Technology allows for learners to reflect, plan and articulate knowledge
    2. E-learning embeds amongst their learners core digital literacy skills – which is crucial
    3. Learning and assessment become more authentic through digital learning à more closely aligned to workplace
    4. For instance with ACCA-X, there is an emphasis to ensuring that the business and accounting theory is supported by interactive simulations of actual practice and with significant support in ensuring learners understand the link between the theory and how they can be expected to apply their knowledge in practice and enable them to be work-ready.
    5. E-Learning allows for students to become active agents of engagement and change and allow them to further develop their social and leadership skills. It also aids students towards becoming self-aware and independent learners which could be argued is the main purpose of education. It is this quality that should be at the heart of institutional strategy policy formulation.
      (C) zodakreza
  • E-learning allows the opportunity to establish a clear pedagogy (to cater to the different learning styles) – to the right levels of assessment – to effective monitoring and management (through data) and support a process of continuous improvement.

 

 

Building the foundations for data-led learning

  • The data allows for identification of hot spots, areas for improvement and ensure a programme of targeted support and intervention.
  • Data analytics and review is a critical component to aid both educators and learners along with policy makers.
  • The availability of data to enhance educators’ ability to better support their learners is a major component of effective e-Learning.
  • Tutors also have the tools to enhance learner management and be able to teach to scale.
  • The availability of learning data will also be instrumental in helping policy makers and researchers identify the learning gaps and hot spots and ensure there is effective capacity building taking place at appropriate levels to resolve outstanding issues.

Capacity building for educators and policy makers

  • This is often an area that is overlooked as e-learning programmes and initiatives are rolled out.
  • Whilst there is ample learning support for students to help them make the relevant transition to e-learning and blended learning, there isn’t always the same level of support of policy makers.
  • A key policy area for policy makers is to provide the right levels of support to educators as they embed e-learning within the curriculum.
  • The ACCA experience has demonstrated that there needs to be support for educators in helping develop blended learning solutions so that they are able to best leverage the opportunities offered through e-learning.
  • It is a large shift away from strictly face to face traditional’ transmit’ style learning – and training and support needs to be given to help educators adapt to e-Learning.
  • Educators and teachers also need to be given the comfort and confidence that e-learning is not designed to replace them. It is in fact designed to re-configure their role and their place in classrooms.

 

The value of partnerships

  • Developing effective partnerships will be the most effective way for countries to develop effective e-learning and knowledge platforms and solutions to meet their needs and ambitions.
  • The development of high quality e-learning (from the pedagogy to course development to platform development and delivery) can be extremely resource and investment intensive. This can be a significant deterrent for various developing and transition economies to either defer investment or worse, to develop poorly designed e-learning solutions which hinder more than they help.
  • The ACCA experience has shown that through partnerships, it is possible to develop a high-quality learning experience and allows for stakeholders in developing and transition economies to scale the learning curve much more rapidly.
  • Partnerships between policy makers, educators, industry organisations and employers is vital in developing the e-learning solutions developing nations needs.

Conclusion

E-learning solutions represent the most efficient way for nations to build the productive capacity they need to support the wider learning and development programmes to support their employability agenda, to promote social mobility and tackle the endemic problem of inequality.

The path of e-learning and digital learning that remains ahead of us is an exciting one. It is not without its challenges but a focussed and targeted approach of developing the appropriate e-learning solutions that are fit for purpose and in partnership, where possible, will ensure that much more rapid progress is made.

Muzzling a rockstar central banker – the Indian way

This article reflects only my own personal thoughts and do not reflect the official position of any other organisation. Responsibility for the information and views expressed this article lies entirely with me. 

The news of the resignation of India’s central banker Raghuram Rajan has unsettled Indian investors, and rightfully so.

Rajan was one of India’s best central bankers and was a cornerstone in driving the Indian economy over the last three years.

Here is a man who in 2005 at a conference in Jackson Hole made some prescient statements about how financial developments have made the world a riskier place and called out the systemic risks posed by banks to the global economy. (His speech can be found here: https://www.imf.org/external/np/speeches/2005/082705.htm). He was derided as a luddite who was misguided. However, the developments of the 2008 financial crisis proved him right and a number of his proposed safeguards have since been implemented.

Some may question why the current Indian administration has removed a man who is widely recognised as an architect of India’s growth story.

It goes back to 2014, when Rajan questioned Modi’s “Make in India” campaign and cautioned against “against picking a particular sector such as manufacturing for encouragement, simply because it has worked well for China. India is different, and developing at a different time, and we should be agnostic about what will work.”

Last year, Rajan also questioned the rising of sectarian tensions and intolerance propagated by factions associated with the currently ruling government.  In a speech to the Indian Institute of Technology last October, Rajan lambasted the rising intolerance and stated: “India has always protected debate and the right to have different views. Excessive political correctness stifles progress as much as excessive license and disrespect.”

This is consistent with the pattern of behaviour displayed by the current Indian administration .

What have Modi and his administration achieved in the last two years:

 

So what does this administration do in response? Remove one man who can help make a difference and help improve matters.

Another great article here: By getting Raghuram Rajan out, Modi may have won, but India has lost

I am genuinely concerned at the state of affairs in India and despite the sometimes effective PR campaign Modi’s government may run, the cracks are beginning to show.

India’s always been a home to alternative thoughts, ideas, ideologies, religions, faiths, beliefs, ethnicities and ways of life. We have been a beacon of hope and democracy for all and it is very sad to see the very edifices of inclusivity and secularism crumbling.

 

 

Where technology lost to tradition

Over the last few decades we have seen numerous examples where technology has usurped tradition, leading to plenty of hands wringing, worrying and eventually acceptance of technology’s dominance over the things that we previously thought were ‘the way things are done’ or tradition.

From going to a travel agency, or flagging for a taxi, or buying takeouts , we have now ditched habits and activities that were previously taken to be the de-facto way.

In the light of these changes (and some undoubtedly have had a huge benefit in people’s lives), it was interesting (and perhaps heartening) to read an example of how tradition managed to stand strong in the face of overwhelming technological progress and indeed even strike a blow and reign supreme!

This is the curious tale of the dabbawalas.  A recent Bloomberg Business article, Startups Haven’t Replaced India’s 19th Century Food Delivery Service (February 3, 2016), highlighted how over 400 technology/app driven businesses backed by over US$120 million of funding  have failed to dislodge a 120-year old, traditional food delivery enterprise. The aspiring new-age disruptors failed to make a dent whilst single-handedly decimating traditional black cab/taxi or travel industries.

Only a handful of 400 food-delivery-tech start-ups are still in business after having lost much of the VC funding and thousands of staff, despite spending millions on technology, promotion and advertising.

I thought it would be useful to take a closer look at the conditions that have led to the enduring success of these dabbawalas (from ‘dabba’ which means lunch box or tiffin carriers – the ubiquitous multi-layered carrier tins; and ‘wala’ which loosely means man or deliverer leading to ‘dabbawala’ – lunch box delivery man).

First some context and history to the humble dabbawala:mumbai-dabbawala

  • Starting from 1890, no rain nor flood nor natural disaster nor riot not terrorist strike nor weather has stopped the dabbawalas in fulfilling their duties.
  • The business model has remained exactly the same since the very first delivery: food prepared at home or community kitchens are delivered to students and workers in schools, offices, factories and depots in a lunch/tiffin carriers, and the empty containers are returned!
  • 5,000 dabbawalas now deliver about 175,000 to 200,000 meals a day (or over 50 million meals a year)
  • They have only ever gone on strike once in over a 120 years – and even then timed it on a public holiday – and in support of an anti-corruption campaign!
  • Each dabba or lunch box changes hands at least six times in transit before it reaches the final consumer – or 2.4 million transactions per day (200,000 deliveries X minimum 6 transits X 2 – to return the lunch/tiffin box back)
  • There are some claims that the dabbawalas lose only one tiffin box per 1.6 million deliveries (comfortably allowing them to be within the six-sigma standard of 3.4 defects per million transactions) – despite the absolute lack of technology or apps to support them. All that is used is a system of alphanumeric codes to identify the source and destination of each dabba.

Next, let’s consider the business and employment model used by the dabbawalas:

dabbawalas1

  • The monthly service charge for the delivery of the lunch boxes is between 400 to 1,200 rupees (or between US$6 to US$18 monthly).
  • The prices are not based on distance but on the customers’ ability to pay – deliveries from richer neighbourhoods means higher rates.
  • There are about 200 ‘managers’ who act as supervisors to teams of up to 25 dabbawalas – managing the total 5,000 dabbawalas
  • The dabbawalas age ranges from between 18 to 65 and are often poorly educated (often rarely receiving formal education beyond the age of 14 or 8th standard in Indian education terms)
  • The dabbawalas continue to be paid low wages – approximately 8000 rupees (or about US$120 monthly) but have achieved a very low attrition rate or labour turnover.
  • Each dabbawala receives the same income, irrespective of experience, age or number of customers serves.
  • Each dabbawala is not an employee, but is an entrepreneur and equal shareholder in the Dabbawallah Trust.
  • The dabbawalas employ a risk-mitigation system of a KYC (know your customer) principle to prevent the threats of contraband or bombs being delivered and implement a minimum monthly-subscription rule.

 

So how have these poorly educated, lowly paid individuals without any access to any computer or app to support their delivery system become an award-wining group of process champions?

  • The dabbawalas have been the paragons of social entrepreneurship – leading to social mobility through enterprise. They have provided employment opportunities for those who have needed it the most. The late Paul Goodman, Professor of Organisational Psychology at the Carnegie Mellon University, described it as thus: “They provide a different picture — a complicated system of working built around human ingenuity and supportive social arrangements that has long been absent from U.S. industry,” in his documentary on dabbawalas.

 

  • Uncompromising attitude to cutting out waste or preventing excesses – this has led to the dabbawalas rejecting a number of potentially lucrative marketing or sales opportunities because it was deemed that they will take up time and impact their core business of delivering on time every time.

 

  • Culture – there is an unwavering commitment to their cause.

The dabbawalas are of a view that their duty is akin to service to God. They are committed to the last man towards a single principle of delivering food on time to the right person.

As Manish Tripathi, a director of the Mumbai Dabbawalas states, “Our work revolves around a few beliefs – the most important ones of which are sticking to time and believing that work is worship. Annadan is mahadan (giving food is the greatest charity). We dabbawalas have a strong belief in god. But you don’t see god, do you? So, whom do you worship? People – after all, they are creations of god. You worship god by ensuring that people get to eat their food on time.”

Professor Stefan Thomke of Harvard Business School notes in his paper, “Culture, for example, often gets short shrift. Too few mangers seem to recognise that they should nurture their organisations as communities – not just because they care about employees but because doing so will maximise productive and creativity, and reduce risk.

 

  • Superior focus on organisational objectives and customer service

There is an absolute focus on unerring time management logistics and commitment to superior customer service through accuracy.

An interesting anecdote is when the dabbawalas were informed that Prince Charles wanted to meet with them, they allowed for the request on the condition that Prince Charles should be at Mumbai’s Churchgate station between 11.20 am and 11.40 am. The mere 20 minutes were given because “they could not take time off work” and only because that was the short period of the day when the dabbawalas had a rare moment of a break time!

Prince Charles Dabbawalas

(As an aside, it is also worth noting that of the three indians invited to Charles’ wedding – two were dabbawallahs (who presented gifts for Camilla (sari) and Charles (turban) – paid for by the dabbawallas pooling)

 

  • Effective leadership

The managers (each managing up to 25 dabbawalas) do not see themselves as leaders or supervisors. They are individuals who help to continuously improve the work-place practices and systems and empower their teams to make decisions within a clearly defined set of parameters. The individual dabbawalas make rapid decisions (modern managers may label this ‘agile’).

There are regular meetings once a month where decisions are made and issues identified and discussed. In the rare event of an error, an investigation is launched to ensure it doesn’t occur again and customers are refunded.

 

  • Adopting new practices to serve customer better

Whilst the delivery model has remained the same, the dabbawalas have introduced innovations such as delivery booking through SMS, online booking (through www.mydabbawala.com) and also introduced online customer services feedback. The customer-centric approach that has been instrumental to the success of the dabbawalas continues.

 

The secret to the dabbawalas is best described by Professor Thomke who says, “The dabbawalas have an overall system whose basic pillars – organisation, management, process and culture – are perfectly aligned and mutually reinforcing. In the corporate world, it’s uncommon for managers to strive for that kind of synergy.”

In this day and age, where the human touch is going out of fashion, the dabbawalas remain a source of inspiration and there is much to be learnt from them.

Branson dabbawalas

As Richard Branson (who spent a full day with the dabbawalas) said, “I will tell my employees: walk like a dabbawala.

Indeed!

dabbawalk

Going beyond networks and building communities

As someone who works for a leading global professional body dedicated to delivering public value to society on behalf of its members, I’ve been thinking about the notion of networks, what it means and whether the emphasis should be around going beyond the notion of mere networks and building communities with a strong sense of ownership by its constituent members supported by active engagement and dialogue.

Numerous businesses have built themselves formidable networks with their customer base but could be missing out on significant advantages in evolving those networks into communities.

Wenger, Trayer and De Laat, (2011) have provided clear definitions illustrating the differences between a network and a community:

“The network aspect refers to the set of relationships, personal interactions, and connections among participants who have personal reasons to connect. It is viewed as a set of nodes and links with affordances for learning, such as information flows, helpful linkages, joint problem solving, and knowledge creation.


“The community aspect refers to the development of a shared identity around a topic or set of challenges. It represents a collective intention – however tacit and distributed – to steward a domain of knowledge and to sustain learning about it.”

 

Distinguishing a network and a community

A network is inherently a passive set of relationships and connections (normally anonymous) between individuals, which is geared towards only information flows, and transactions across the connections. Networks tend to be primarily transactional in nature (mainly through the consumption of services and goods) with little by way of value creation.

Communities on the other hand lend themselves well to action and intervention by individuals who are connected around a shared identity, philosophy or collective intention. Communities tend to inspire a sense of camaraderie and collective action by the participants who belong to it.

 

What this means for businesses

Companies that successfully are able to develop and build on their networks and transform them into communities will be able to not only enjoy the scale afforded by networks but also improve the level of dialogue, engagement and sales which in turn improves the margins, leading to better business value.

Essentially:

Networks = High volume X Low margins (due to mainly transactional nature of mostly one way transactions)

Communities = High volume X Higher margins (due to improved dialogue, satisfaction which in turn leads to higher sales and possibly margins)

If we consider the largest companies in the world such as Amazon, they don’t merely seek to develop a large customer base who go to them to buy the products they seek. Instead they have invested significantly towards developing communities within their sales platforms, leading to improved two-way dialogue, and encouraging greater sales of a larger range of products.

Facebook has gone beyond simply creating networks and their initiatives such as “On this day” and “Friends’ Day” are all geared towards engaging their networks towards a more meaningful community, to imbue a sense of camaraderie and fellowship amongst their users. This is what will support the longevity of a social network like Facebook and ensure they avoid the mistakes made by the likes of MySpace and FriendsUnited, which did not seek to go beyond the creation of networks.

Superior organisations take the networks they have, understand the key propositions their networks seek, develop their messages further, engage them better, enhance the levels of dialogue across the participants of the network, and in the process form the basis of a community that will sustain the business towards long term value.

 

 

The inequities of India’s proposed Land Acquisition Bill

The Indian government led by Modi has proposed a series of wide-ranging reforms to the Land Acquisition Bill which, in my personal view, will have a deleterious effect on the nation and her people.

The long and the short of this new Bill is that it will allow for the government to take over land from landowners without sufficient due diligence or understanding the social impacts in the name of ‘public interest’ whilst not actually defining what this ‘public interest’ may mean.

The proposed Land Acquisition Bill fails the most material principles of the Indian Constitution – that of democracy, welfare, justice and equality.

The context

Flawed analysis – leading to incorrect conclusions

The problems with the proposed amendments

Conclusion

Paddy Fields in India
Paddy field in India

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The context

For almost one hundred and twenty years, India’s land acquisition was governed by the Land Acquisition Act of 1894 which was a fundamentally exploitative, oppressive and inherently unjust piece of colonial legislation. Since Independence, over 50 million people have been displaced in the name of development. A large segment of the displaced includes entire scheduled tribal communities. The vast majority of the displaced have faced declines in the quality of life, received inadequate compensation and have ended up being marginalised in their own lands.

The Land Acquisition, Rehabilitation and Resettlement (LARR) Act of 2013 was subsequently passed with the official mandate to support the twin objectives of farmer welfare along with the strategic development of the country.

When Modi and his government took over, they decided that they wanted to amend a number of major aspects of the LARR as one of their core priorities. The proposed amendments have drawn widespread condemnation and flak, not just from the opposition, but from within the ruling party itself and more importantly the majority of the populace, particularly those within the rural community.
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Flawed analysis leading to incorrect conclusions

Part of the problem arises from the fact that current Indian administration’s economic analyses predicated on the notion that greater freedom by the State and large commercial interests in acquiring land and property will promote accelerated economic growth. Land acquisition is often cited as an impediment to India’s growth and India’s policymakers and a number of corporate-sponsored industry bodies would have us believe that having a draconian bill to confiscate land is the panacea to India’s economic ailments.

On the contrary, according to a Ministry of Finance-led Economic Survey of 2014/2015, it is less than 1% of projects that have stalled in India as a result of land acquisition issues.

India’s true obstacles to economic progress include corruption (which imposes a cost of between 1% to 3% of total GDP), tax evasion and ultimately a lack of a consistent and coherent economic policy.

Land grabs by the State actually have a huge cost, both economic and societal, for India. An unfair and unjust land acquisition campaign will only serve to further exacerbate the problem of rising income inequality and social disparity that remains a stain on India. The economic, social and environmental cost of displacement and conversion of forests/agricultural land towards industrial assets have never been truly understood or analysed by the government.

The ownership of land is a fundamental basis of livelihood and subsistence for a majority of Indians. Mere monetary compensation, without a resulting benefit in the form of employment will have devastating consequences for farmers, farmhands, artisans and other individuals whose livelihoods depend on agriculture and farming. Forest tribes, adivasis (large segments of tribal and aboriginal groups in India) and dalits (the most marginalised segments of the Indian population) who have been impacted as a result of past land acquisitions will in turn be even more marginalised and suffer even more inequity and exploitation.

The current Indian government is pushing for its “Make in India” slogan. There is no point making in India, if it does not benefit the majority of Indians and only serves to undermine and taint India.

“Make in India” – but not for Indians’ benefit?

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The problems with the proposed amendments

There are a number of serious problems with the amendments being proposed by the government.

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First and foremost is the deletion of the clause to consider the social impact assessment of the land acquisition. Without the ability to assess the possible adverse impact a potential land acquisition has on people in an area, how can we truly understand the externalities (negative or otherwise) and make an informed judgement about the wisdom of acquiring the land. How will we be able to say, to a high degree of comfort, that the benefits of the land acquisition will indeed be substantively higher than the resultant costs and consequences and benefit a broader segment of society?

2

Secondly, agricultural land has to be viewed as strategic assets designed to support the development of the nation in order to preserve food security. We have seen countless nations, who in their rush to convert viable agricultural land into vast sweeping industrial or tourist outposts, have lost their ability to feed and serve their people and have had to resort to food import in order to sustain themselves. It can be argued that agricultural efficiencies have improved and that the same output can be delivered with a smaller land area – but in order for this to be truly understood, there has to be a clear understanding and assessment of impacts, which this government does not want to do either. India cannot surrender her independence in her ability to feed, serve and protect her people.

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Thirdly, the previous Act had a provision which required the consent of 80% of affected individuals prior to the land acquisition. The amendments proposed will allow for the government to unilaterally acquire land without the permission of the people who depend on the land. The principles of democratic conventions are being violated here. Unlike a few other countries, India’s rule of law is not enforced by a dictatorship of some nature or under a command economy where all ownership belongs to the State. India is a democracy – a government of the people, by the people, for the people. With the proposed amendment, the state will be a government of a very small group of people, by the faceless/nameless corporates and industries, and certainly not for the people.

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Fourthly, the amendments themselves are vague and, it appears, intentionally ambiguous. ‘Public purpose’ has not been clearly defined and no indicators are being proposed to indicate whether the nation benefits and aids the welfare of all. Five categories of projects are being proposed (national security and defence; rural infrastructure; affordable housing; industrial corridors; and infrastructure (including public-private partnership projects (PPPs)) which are being defined in the broadest possible way which will allow for the government and their industry and corporate partners to acquire/confiscate land without a robust case. It is the absence of a sufficiently strong check and balance that is the biggest cause for concern here.

As the law stands, if no development takes place on acquired land within five years, it has to be returned to the people. This has also now been amended and the land can be held on indefinitely from the time of purchase with no recourse made available to the people who are being impacted. Under the amendments, more land than is required can also be acquired by the government, including the purchase of an additional one kilometre of land on both sides of an industrial corridor – which again will have severe debilitating effects on farmers and small land owners. There is also no consideration of efficiency on the part of the industries and the state looking to acquire the land for their uses and it does not spur or promote more efficient use of the land and instead ends up subsidising the absence of efficiency improvements made by industries.

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Finally and most fundamentally, the proposed amendments to the Land Acquisition Bill violate the principles of individual liberty and human rights. What this Bill does is redistribute land away from the poor and the most vulnerable to the richest and most privileged segments of society. The principles of prior consent and recognition of the societal and economic impacts on the people most directly impacted by any land acquisition is essentially a land grab by those who can from those who cannot do anything about it.


Land Grab

Conclusion

Land is not just a mere economic commodity or factor of production to a large number of people who will be affected by the proposed amendments of the Land Acquisition Bill. Land is a source of life, of sustenance, of faith and of hope. It is a function of the culture of the people who depend on it, be it the farmers, the forest tribes or the dalits. It is a source of livelihood, of dignity through employment and of a symbol of progress and growth.

India can only truly progress, economically and socially, if there is an improvement in the lives of all Indians and not just a select and privileged few.

A nation must be judged not just on what economic progress it has made but on how it has enhanced the welfare of its most vulnerable constituents.

The proposed amendments violate the principles of the Indian Constitution which dictate that India remains a sovereign, socialist, secular and a democratic republic. Socialism and democracy will be the first casualties if this Bill comes to pass – for how can a nation claim to be democratic when it tramples over the rights of its own people to own land without a proper recourse and safeguards.

The amendments to the Land Acquisition Bill must be opposed at all costs. At stake here is not just about India’s principles of fairness and equity for her people but about the future of a prosperous India which benefits all and not just a select few.

 

References:

http://www.dnaindia.com/india/report-land-acquisition-bill-implies-deep-trouble-2072222 (Shivani Chaudhry)