November 30, 2005
Counting karo tum...!!!
Thot of Amir Khan saying that line in the 5 buck Coke commercial and said heck why not me have a counter too. So thats just what I did... registered on Bravenet for a brand new counter. Will have to forego all the clicks till date though; but it wont be much of an issue considering the fact that the blog is not visited so frequently.
Value steel
Past few days have seen a lot of bidding for Dofasco, the Canadian steel maker. First there was a hostile bid by Arcelor, the second largest steel co. Apparently, Arcelor wanted to strengthen its automotive steel division. Arcelor already is a major supplier to european carmakers, on the other hand, Dofasco has been a major supplier to North American carmakers Ford and GM. Probably the acquisition would create a monopoly in the automotive steel and Arcelor would be in a position to armtwist the already flagging auto industry in the West. It could also sound the death knell for US automakers. There could be a chance that GM, Ford and other US automakers might have forced Dofasco to reject the proposal from Arcelor.
As soon as the Arcelor threat was averted, Thyssenkrupp AG, the German steel maker made an offer at 40% premium to Arcelor's bid. Thyssenkrupp is also an automotive steel supplier, then what makes TK different. The only difference that I can see is that TK can add value to Dofasco's steel since TK has a service that caters to automotive design and planning which coupled with Mechatronics can be a differentiator in this old economy industry.
Should indian firms follow this model. I say a resounding yes. With demand from China set to slow down in the coming years due to the cooling of their economy there is going to be a reduction in demand for steel. Add to that the effect of falling prices due to overcapacity generated due to the highly liquid environment of the past few years, theres set to be havoc in the global steel industry.
In such a scenario, firms will survive on two counts only. Either they consolidate or they differentiate. The global consolidation game has started with Mittal steel setting the pace last year. These year will see more acquisitions. Dofasco is the first big fish this year. But will blind acquisitions aid survival? Somehow I dont think so. Primarily because these will create inefficient monopolies. But in the case of Thyssenkrupp I can see a strong value model. In fact its going the way GE went in the 90s by increasing the services component in its portfolio. There's a lot of value to be unlocked by linkages to customers (read value added service based steel) rather tha than just forcing iron down their throats.
As soon as the Arcelor threat was averted, Thyssenkrupp AG, the German steel maker made an offer at 40% premium to Arcelor's bid. Thyssenkrupp is also an automotive steel supplier, then what makes TK different. The only difference that I can see is that TK can add value to Dofasco's steel since TK has a service that caters to automotive design and planning which coupled with Mechatronics can be a differentiator in this old economy industry.
Should indian firms follow this model. I say a resounding yes. With demand from China set to slow down in the coming years due to the cooling of their economy there is going to be a reduction in demand for steel. Add to that the effect of falling prices due to overcapacity generated due to the highly liquid environment of the past few years, theres set to be havoc in the global steel industry.
In such a scenario, firms will survive on two counts only. Either they consolidate or they differentiate. The global consolidation game has started with Mittal steel setting the pace last year. These year will see more acquisitions. Dofasco is the first big fish this year. But will blind acquisitions aid survival? Somehow I dont think so. Primarily because these will create inefficient monopolies. But in the case of Thyssenkrupp I can see a strong value model. In fact its going the way GE went in the 90s by increasing the services component in its portfolio. There's a lot of value to be unlocked by linkages to customers (read value added service based steel) rather tha than just forcing iron down their throats.
November 23, 2005
The Thirst Theory
I have developed this theory called 'The Thirst Theory'. It states that "If a person sees a bottle of water in the middle of a discourse, that person feels thirsty." The discourse here applies mainly to classroom lectures. It has been proved beyond doubt in the last 5 years.
A typical experimental proof goes something like this. A specimen will make it known to all other specimens that he/she is drinking water. Subsequently, thirst levels start going up in surrounding specimens. Somewhere far away, a particular specimen's thirst will cross the threshold level and he/she will solicit the container of water. But as the container of water begins its journey across the class, the threshold of specimens in its vicinity is immediately crossed (something like the 'Lord of the Rings'... the water bears its influence on those who carry it) and they drink of that precious little that remains. The value of water goes on increasing as it inches closer and closer to its real destination. As it reaches the intended specimen, there is little left, and the specimen relishes each drop.
Funny but true. Check it next time someone drinks water in class.
A typical experimental proof goes something like this. A specimen will make it known to all other specimens that he/she is drinking water. Subsequently, thirst levels start going up in surrounding specimens. Somewhere far away, a particular specimen's thirst will cross the threshold level and he/she will solicit the container of water. But as the container of water begins its journey across the class, the threshold of specimens in its vicinity is immediately crossed (something like the 'Lord of the Rings'... the water bears its influence on those who carry it) and they drink of that precious little that remains. The value of water goes on increasing as it inches closer and closer to its real destination. As it reaches the intended specimen, there is little left, and the specimen relishes each drop.
Funny but true. Check it next time someone drinks water in class.
November 10, 2005
The last of the mid terms...
Mid terms are over and thats a relief. This mid terms have been much better than the one last term. Did quite well and I'm waiting for the results. Have decided to spend a good deal of time in the library this remaining term.Our management symposium is coming up this weekend. Delphique... thats what its called. Seems to be a much decent event than the ones previously organised. Only thing that sucks is that there is compulsory attendance. Crappy I say. But in an upcoming bskool we need to humour corporates. The focus is not on learning but again on Corporate Relations. Sadly, we are not out of that mentality yet. Gotta stop cribbing about the things here.
November 6, 2005
Illuminated??
Had been desisting from posting this from a long time... Illumina our market research fest concluded on 31st October. Here in the guise of a Diwali Mela we students at MDI lead consumers to play asinine games (of course after assuming that they are a bunch of gullible fools). At the end of the day we claim a footfall of a few grand and the sample from where we collect our data wouldnt impress a chimp agency. The data collected is allowed to flow through a series of software iterations and the output is presented with fanfare.
This year we had HLL which gave us a brief of getting consumer insights into cappuchino coffee. Yes Boss! the mighty HLL is going to take the esteemed opinion of yet-to-be MBAs (who have gained insights into consumer behaviour from those great games that they designed) on whether they will launch their coffee. After all Nestle is a small fish. They are nuts to carry out MR with firms like AC Nielson, ORG- MARG and the like. MDI's greats are better. Talk about gaining competitive advantage!
The other games the less said the better. However, must say that the event was organised well. But the concept sucks big time. Events like these are all relationship building exercises. And this is not restricted to MDI. All insitutes do it. So confirms my friend from a reputed Mumbai based institute. So what are we doing here. In the quest for relationship building do we teach students what is happening at in the real market. You should see the confidence with which people were willing to swear by the MR. Brings me back to the point I raised a few weeks ago that we are generating managers with lack of practicality. God save us!!!
Anyways I gotta prepare for the mid terms beginging tomo...Wish me luck.
This year we had HLL which gave us a brief of getting consumer insights into cappuchino coffee. Yes Boss! the mighty HLL is going to take the esteemed opinion of yet-to-be MBAs (who have gained insights into consumer behaviour from those great games that they designed) on whether they will launch their coffee. After all Nestle is a small fish. They are nuts to carry out MR with firms like AC Nielson, ORG- MARG and the like. MDI's greats are better. Talk about gaining competitive advantage!
The other games the less said the better. However, must say that the event was organised well. But the concept sucks big time. Events like these are all relationship building exercises. And this is not restricted to MDI. All insitutes do it. So confirms my friend from a reputed Mumbai based institute. So what are we doing here. In the quest for relationship building do we teach students what is happening at in the real market. You should see the confidence with which people were willing to swear by the MR. Brings me back to the point I raised a few weeks ago that we are generating managers with lack of practicality. God save us!!!
Anyways I gotta prepare for the mid terms beginging tomo...Wish me luck.
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