Saturday, September 6, 2008

Why don't Indian CEOs build roads ?

Why don’t Indian CEOs build roads ?

by

hemendra k. varma



Really difficult to fathom but almost universally true – no Indian CEO (barring a miniscule number) builds roads. Go to any factory of an Indian company (barring that same miniscule number) and you will know what I am talking about. The journey from the gate to the main building, or wherever else you are going, will be as traumatic, or worse, as the one you have just completed on the public road you travelled to reach the factory. The roads inside any factory (barring the miniscule exception and the PSUs) are either non – existent or in such a bad condition that you would think that the public roads were a carpet drive, in comparison.

Whenever I have raised this question with factory owners,/ factory chiefs, the common refrain has been : we are currently doing some expansion and after all the work is over we will build the roads. How ingenious and how naïve !

The whole idea of good roads is to let you move your goods faster and safer so that your construction activity can happen quicker and smoother. But this just does not get into the heads of these CEOs and their “couldn’t care less” Project Managers. One large company, having turnover of thousands of crores, which is currently doing an expansion costing approx. Rs. 50 crores, continues to work with muddy roads which is now leading to frequent “truck – jams owing to wheels getting stuck in the wet mud of the monsoon”. But their Project in-charge has managed to mesmerize the owners that he is doing a good job because he is concentrating on the main thing i.e. building the shed. That poor fellow does not realize how much faster he would have worked if he had built the roads first and how much easier it would have been for people to move in the site area, even those that had to walk.

In another company which is doing a complete repair, refurbishing of its factory and factory office area, it has simply not budgeted for rebuilding and repairing its derelict roads on grounds of Fund allocation priority. They are going to spend close to Rs. 60 lakhs in this entire repair/restoration exercise but are unwilling to spend a few lakhs more to make pucca roads on grounds of saving money.

The fact of the matter is that owing to the apology of a road that exists, the lose earth and particles continuously generate dust and dirt which gets swept into that shop floor, not only creating a filthy working atmosphere but also affects the quality of output especially when such dirt gets into valves and pipelines during assembly. Over the years they have already spent and will continue to spend lakhs to clean the shop floor and the equipment or pay by way of replacing defective parts and equipment, but they simply will not build roads.

We do considerable work in the area of 5S -- a Japanese workplace practice that helps create world class workplaces. One of the points of emphasis in the 5S Approach is cleanliness as exemplified by a dirt free workplace. Whenever we come to this part of the implementation, I have all managers from the President to the junior-most executive explaining to me in a learned and condescending manner why this is not possible in India because in India we have so much dust.

And why do we have so much dust ? Because no factory has roads. The un-surfaced, un-tarred, un-concreted path that is the proxy for a road in almost every Indian factory is an ocean of dust ready to fly inside your works and offices at the slightest hint of a wind. Hence, this has got nothing to do with India ; it is simply that you have not build roads which would remove or substantially reduce the scope for dust generation because there wouldn’t be any uncovered dust, if the roads were tarred or concreted.

After all why is there so little or so much less dust in the developed countries. It is simply because they have so little uncovered areas - the open spaces are either concreted (or surfaced in some manner) or “lawned” (if I may be permitted to coin a word). Hence there is nothing inherent about dirt or dust being uniquely an Indian phenomena as all the Indian CEOs propound.

The truth of this can be easily seen if you walk through any PSU Plant or any Tata Plant or any Birla Plant. Barring these old warhorses which are often decried and disparaged for being old-fashioned and not sufficiently dynamic, all the new glamour boys are led by CEOs who don’t’ build roads.

Actually, the question is bigger and the malaise runs much deeper. It is not merely about not building roads. It is about a much bigger issue of not building or not investing sufficiently in “infrastructure” of which the road is a large, visible symbol. But there are so many more.

Some of the observations I have in this regard are :

1. Not only are roads poorly built and even more poorly maintained, they are narrow and clearly inadequate for the traffic requirement in the factory. This is supposed to be “saving of money” though these smart CEO’s do not seem to realize that for this supposed small, one – time saving in capital cost, they have perpetuated a costly infrastructure that will breed delay, accidents and mishaps for a life-time.


2. The same is the story with staircases. They are so narrow that not only is carrying of equipment and machinery a big pain every day, it is also very unsafe. Stupid architects who understand nothing about factories are called in to design factories and try to demonstrate their expertise by “showing the CEOs how they have saved money by not wasting it on wide staircases”, and making that “saved” area available for installing more plant and machinery !! Whereas engineers, who understand the business of factories better and more intimately than architects, are ignored for having no aesthetic sense and wasting space only so that they can work comfortably !

The same short – sightedness prevails here, too. These narrow staircases delay every subsequent movement of goods and people, lead to frequent accidents, big and small but since it “personally does not hit the CEO or owner” they are least concerned.


3. Take a look at the toilets – leaking taps, wet, dirty floors, dirty, stained urinals and pots, filthy towels (where provided) which you would dare not touch for fear of contracting a disease. This is the story of 90 % of Indian factories led by all these so-called dynamic new – age CEOs. But how can money be wasted on toilets in factories -- it will affect the bottom – line. Besides, as per the new-age philosophy of business, business should concentrate on its core business – the product or service that it sells and not waste time on silly things like clean toilets for its employees.

It is not just the “factory toilets” that are in this ghastly condition. Most of the “office toilets” are only marginally better – instead of being ghastly, they are merely horrible.

The CEOs are blissfully unaware of this, because they have ensured a private toilet for themselves. Indeed, most Indian CEO’s are unaware of anything because they rarely do the rounds -- be it of their offices, the reception area, the store-rooms, the pantry or the toilets or for that matter even of their factories and the various areas there. They are stuck to the air-conditioned comforts of their obscenely decorated “rooms” cut-off from the realities of the daily hardships their employees face on the entire infrastructure front.


4. Forget the condition of toilets, left to themselves, Indian owners and CEOs, would not even build toilets. A large company whose turnover exceeds Rs. 2000 crores has just completed a new unit which comprises two sheds over 200 metres long. It has been provided with just one toilet area having 4 urinals and 3 WCs and one basin. It takes a person working at the far end close to 5 minutes to walk to the toilet, with all the hindrances of plant and equipment, moving loads and narrow passages. It takes the same time to come back. And, often, the same time to wait for the use of the toilet facility !


5. In short, a “wash room break” can take as much as 15 minutes simply because of the inadequacy of the infrastructure. Multiply that time over hundreds of employees, every day of the month and year, and then one can easily realize whether the saving effected in having only one toilet can pay for the daily cost of the “productive time” wasted by employees in the use of this facility.


6. Go to any office toilet -- in the best of companies. You will invariably find the pantry right next to it or many times, even part of the same enclosure, part of which is the toilet area and the other part is the pantry. I refuse to have tea/coffee in such companies if I discover this arrangement before I am offered any beverage.

Why is this arrangement made ? Because, as the same stupid architect will explain, it saves on plumbing costs since both the pantry and toilet require water inlets and outlets !! Just look at the myopic thinking which is allowed to prevail over even simple hygienic considerations. Would you build a toilet in or next to your kitchen to save on plumbing costs ?

But, the Indian CEO is least bothered about such “infrastructure” considerations. He probably has his own private pantry or at least does not get to see the arrangement, since at least he has his own private toilet. It hardly matters to him what the rest of his employees & guests have to suffer.

7. Savings are made on telephone instruments ; just one or at best two instruments will be provided at the desk of the HOD or his assistant while the lesser mortals below them will have to walk a fair distance to take or make a call.

When I enquired of a CEO why more telephone instruments could not be provide, he was genuinely surprised - Do they really need one ? We can’t have a telephone for every employee (pray, why not. Office oriented companies routinely have one computer for every employee). What a waste of money ! Besides, what is the harm in walking up to get a call, he says.

What the poor CEO did not realize was the tremendous time wasted by his engineers, particularly the maintenance personnel, in attending to complaints or to communicate with other departments. The result was it took much longer to respond to breakdowns which affected production and output.

8. The same is true of Computers. There will be one derelict 486 machine for the department ; it will often not work, everything takes much longer and it often breaks down. It takes even longer to get the system chaps to attend to the fault, spare parts cannot be found easily but a new PC will simply not be sanctioned ! Why do they need a new computer when the old one is working, the smart alec CEO declares !

9. Look at the training facilities, be it in factories or offices. An old apology for a whiteboard exists in most companies. The white board marker ink will just not wipe off. It takes two to three wipes and a generous dose of water before you can clean the board for it to be ready for writing. Next, you will never find transparencies – it is a heavily rationed and restricted item -- another cost saving favourite. OHP markers are rarely available (I now carry my own set for giving to the participants) and when requested for, provided very reluctantly with always an unspoken message “this is really too much -- why do you ask for such expensive items ?!!”

In one organization where we have been working for over 4 years now, it took me two years to persuade the company to invest in a new white board !

However, two other training venues and one conference hall still make do with the derelict whiteboard since the company feels that it is not really necessary to spend money on white boards. Look at the irony of it all.

The CEO/owner tells me : “Mr. Varma, whatever happens I don’t want to stop training. I want all my managers to be trained by you.” On the other hand, there is a marked reluctance to spend a small sum to provide good, new whiteboard which will save considerable time in writing which in turn will make each training programme that much more productive and effective.

The story with the LCD Projector is no different. An old projector which has a limited throw and very poor illumination continues to be used. The result is that the rear rows cannot read or make out what is being displayed and naturally lose interest in the entire proceedings. And to add insult to injury, there is only one projector available between 3 training venues and 4 conference / meeting halls.

There have been a number of occasions when my training programme has been interrupted requesting for the LCD Projector since it is required in an “important meeting”. This is a company which has a turnover well over Rs. 1000 cores but cannot or will not spend a couple of lakhs to get 2 or 3 new projectors.

10. Rare is the company which provides a management library – we are not a college is the standard “no-brainer” from their CEOs. And yet when this same CEO steps into a public platform, he/she passionately talks about the importance of creating a learning environment, where employees can constantly upgrade themselves ! Where some books do exist, they are either placed in the CEO’s room or in the rack behind the HRD Chief’s chair so that no one can access it !! Oh, the innovations of the people who lead Indian companies today !!



11. Look at the Filing cabinets and space for filing - grossly inadequate, poor unfinished wooden cupboards, rusty hinges, almirahs with broken handles, torn file holding folders, and each such occurrence leading to time wasted whenever a file has to be placed or retrieved.


12. Consider the reception area – again that great architect, especially if he is from one of the metros, especially Mumbai -- will provide for just two or three chairs so that if you are the 4th person, you have to stand, Every architect and interior designer from the major metros is taught to measure everything in terms of “per sq feet cost” and squeezes everything except for the boss’s room to show “how much working area he has extracted from a given space”. The truth is that on paper this appears fine but makes life miserable for everyone all through their working life in the office or factory.

Have you noticed the lighting -- it will be so dim and dull (power saving, I am told) that you will get a depression waiting for your turn to be called in by the company official, who having given the time, is never free when you come.


13. If you visit a factory canteen, you will be appalled to see the filth in the kitchen, the leaking and cracked sinks, the creaky tables and the cracked sun mica. The condition of the walls and the whitewash is best not talked about. Recently at a training programme in a large company, I was told by their managers, and I quote their exact words “hamare canteen mein kutta – billi bhi khana nahi kha sakte hai, itna kharab hai !”


14. What is most amusing is that these CEOs who do not invest a single rupee in providing good infrastructure in their plants and offices cry themselves hoarse and lampoon the short-sightedness of the government in not providing good infrastructure --– i.e. roads, electricity, power, transportation, clean airports etc.


I would appeal to CII, FICCI and ASSOCHAM that whenever they hold their next “pontificating” seminar for preaching to the government on what it should do to improve infrastructure and why “infrastructure improvement holds the key to improving India’s economy and competitiveness,“ they should make sure that the speakers who come to preach are from organisations that have wide roads, clean factories, shining and dry toilets and wide and safe staircases.

If the speaker does not meet this criteria, strike him off the list and ban him from any public speaking on this topic. The Indian people can’t take this hypocrisy anymore and will certainly not tolerate it any longer !

In conclusion, to return to the beginning, why don’t Indian CEOs build roads ? I suspect it is because they really do not know how to build anything. They have only learnt how to make money (often due to the general boom in the economy rather than anything special or specific they have done) which has become the whitewash for all other failures and omissions.

They do not know how to build organisations, they do not know how to build systems, they do not know how to build teams, they certainly don’t know how to build roads. What a pity that the breed of Jamshedji Tata and JRD, G. D. Birla, Kamalnayan Bajaj and others like them have become such a rarity.

Dear Mr. CEO - please learn to build roads ; it is only then that you can reach somewhere.



mumbai
July 2, 2006

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