Anand Mahindra: Conscious Capitalism

The zero-sum game is no longer valid in the world of business. Companies must learn to collaborate with all the stakeholders in the society and earn returns through the trust they build with them.

Anand Mahindra, Vice-Chairman and Managing Director, Mahindra Group

At a time when tidal waves of shoppers are hitting Apple stores to grab the first iPads, it seems reasonable to presume that an "idea that will change the world" will be a "thing"; some product, device, or gadget. It is all too easy to forget that the "things" that really alter our world are, and always have been, powerful and abstract ideas. Ideas that change the way we think. Ideas that change the way we perceive the world and our role in it.

Gandhi got an entire subcontinent to follow him and achieved a bloodless victory over the powerful British Empire by articulating the startlingly simple concept of "satyagraha" or non-violence. History provides myriad similar examples: Mandela and his vision against apartheid; the concept of human rights; universal suffrage.

Powerful ideas do not always have to occupy high moral ground. They can be practical, such as the late C.K. Prahalad's constructs of "core competence" and "fortunes at the bottom of the pyramid." They can be scientific, without being unquestionable fact, such as the theories of evolution and the subconscious. They can be inspirational and empowering like the rallying cry of American presidential candidate Obama--"Yes, we can." Or they can simply be a global wake-up call, like the film "An Inconvenient Truth," which probably created a more enduring legacy for Al Gore than a potentially bland and lackluster presidency!

Is there an idea you believe can change the world? Describe it in the comments section at the bottom of this story, and Forbes could publish your idea.
 
The kernel of a new and disruptive idea can emerge from the ashes of a previously venerated idea, and there is evidence of that today. We are witnessing, I believe, the breakdown of a very powerful and pervasive idea that has shaped the credo of commerce until now. This is the notion that the core purpose of business is to maximize returns to shareholders, to the effective exclusion of all else.

I remember, more than a decade ago, Tata Steel deployed an advertising tagline that declared "We also make steel." Their ads extolled the virtues of their corporate social responsibility and seemed to imply that making steel, and money, was a means to an end. The ads became a subject of amusement, and Wall Street devotees quickly pointed out how old Indian companies were not ruthlessly--and appropriately--focused on financial returns, which was why they lagged in global competitiveness and were not investors' favorites.

Perhaps there was some truth in the contention that large Indian businesses were oligopolistic and sleepy; like alligators basking in the sun that needed to be rudely awakened and forced to glide back into the fast flowing river with reptilian aggression.

However, there are signals of the birth of a new idea, one that is not a single manifesto, but an amalgam of beliefs that have been under construction for some time. There has been a widespread perception for a while--even before the great meltdown--that a new mindset was called for. With news of Enron, Madoff, Ramalinga Raju and Lehman, we all knew something was not quite right. The Rolling Stone article that referred to Goldman as a "giant vampire squid" was exercising poetic license to its fullest, but it did indicate a groundswell of discontent.

Business schools responded to this sentiment with initially desultory efforts to draft an ethics code, or to teach integrity in the classroom. But I do not believe such exercises effectively acknowledged the call for a new zeitgeist, one that proposed a new and expanded role for business in the context of the wider community.

There is an evolutionary argument for such a role modification. Commerce was begun when the world was a much more hostile place, and societies still functioned much like their "hunter-gatherer" precursors. In his book Conflict Resolution, James A. Schellenberg says that "… socio-biologists believe that human nature has been profoundly shaped by the competitive conditions under which it emerged as the present species. They don't all see this as producing a general human instinct for aggression; but they do see mankind as faced with a wide range of conditions for which aggression may be a very natural response." I suppose this would account for why phrases such as "killer instinct" and "take no prisoners" form part of the corporate world's core vocabulary.

That's why despite growing messages being relayed to business--first by semaphore, then more explicitly--that consumers and communities wanted to see a new ethos in companies, these signals were greeted with disbelief and resistance. Businesses continued to believe that community activities were kosher only if couched in the garb of "enlightened self-interest," leading, ultimately, to enhanced shareholder returns.

Of course, the need for financial returns is, and always will be, self-evident. A healthy bottom line is not just what shareholders require, it's a resource enabler for all other good things.

But it's also time to move on.

The world has shrunk considerably, and resources are so excruciatingly finite, that not just governments but businesses also need to change their vocabulary and move to a more collaborative approach. Competition will remain fierce, but a zero-sum approach to competitors and a "hunter-gatherer" interface with the environment is no longer sustainable.

We need to confront the changing order more squarely. Collaboration with our wider communities is not just one more way to build a brand or gain subsidies, or curry favor with customers; it is the ONLY way to do business. That's what customers, I believe, have been trying to tell the corporate world for some time, and earning their trust is now going to be a hygiene factor for all companies.
 
We, in the world of commerce, will not earn that trust simply by adopting a set of community activities, all the while believing that these are tools for enhancing shareholder returns. We need to intrinsically believe that the 21st-century company will be comprised of a different genome sequence altogether.

We have to recognize that success will not be defined just by quantitatively measuring the aggregate of our CSR activities. We have to believe, instead, that integration with our local and wider communities is the sine qua non of our existence. And that we will rise only if our work helps the fortunes of all our stakeholders to rise with us.

The interesting thing about this idea is that it requires not one messiah, but a multitude.

Anand Mahindra heads the $6.3 billion Mahindra Group, a conglomerate that specializes in automotive products, information technology and infrastructure. Mahindra graduated from Harvard College and then completed his MBA from Harvard Business School. Under his leadership the Mahindra Group has strengthened its position in almost all the business in the group's portfolio. Mahindra speaks eloquently and is a frequent contributor to debates on business issues and government policy. He was chosen by CNBC TV18 as the Outstanding Business Leader for 2009.

This article appears in the June 4 issue of Forbes India, a Forbes Media licensee.

Edited by S. Srinivasan & Peter Griffin, 06.15.10, 06:00 PM EDT

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Sports gambling/betting must be regulated and strictly managed

Public outcry on proposed move to legalise sports betting in M'sia




Malaysia's Prime Minister Najib Razak

	Public outcry on proposed move to legalise sports betting in M'sia

Public outcry on proposed move to legalise sports betting in M'sia

KUALA LUMPUR : A proposed move by the Malaysian government to legalise sports betting has triggered a huge public outcry.

Public opinion remains split, but Prime Minister Najib Razak is facing objections not just from the opposition but also within his own ruling party.

The fiery protest from the opposition Islamic party and Muslim NGOs did not come as a surprise.

This came after news that Malaysian Chinese tycoon Vincent Tan was reportedly issued a licence to operate sports betting in some of his lottery outlets across the country.

Malaysia, a predominantly Muslim country, has one casino resort and several lottery companies, and some Muslim NGOs said that is sufficient.

Ibrahim Ali, MP of Pasir Mas, said: "It just creates a gambling culture in this country. It creates a lot of social problems because a lot of people are involved in this activity. They become lazy and really rely on this kind of thing, I think it's not good for the country."

Ibrahim Ali heads Perkasa, one of Malaysia's largest Muslim NGOs. He also feels that non-Muslims should not indulge in gambling, which is "haram" or forbidden in Islam.

Under pressure from within and outside his own ruling party UMNO, Prime Minister Najib is re-considering the whole issue of sports betting.

Billions of dollars were said to have changed hands in each World Cup season through illegal bookies who could be operating from anywhere in the world.

Authorities here said there is no way they can effectively curb illegal betting without legalising it, which at least allows them to better regulate the activities and save the government millions of dollars in tax revenues that could otherwise be lost.

The three opposition controlled states have said they will ban sports betting if it is legalised. They said giving out more gaming licences is not the way to raise money.

Lim Guan Eng, Chief Minister of Penang, said: "It's a question of enforcement. If you have proper enforcement, you can regulate it. We are not talking about banning gambling, we are talking about reducing the increasing prevalence of gambling."

Public reaction is mixed.

"At least the government can get some money out of it," one said.

"As a Muslim, how can you legalise something (that) is illegal," another added.

While the debate continues, it is business as usual for many Malaysian sports fans who continue to place their bets regardless of whether it is legal or not.

By Melissa Goh |- CNA/al

MCA backs legal sports betting -It must be regulated

KUALA LUMPUR: Sports gaming should be allowed but it must be regulated and strictly managed.
“MCA proposes strict and stringent conditions to be imposed in sports betting, including the age of punters, operating hours and others,” said party president Datuk Seri Dr Chua Soi Lek.

He said in developed countries, sports gaming industries were well managed and regulated.

Party matters: Dr Chua (centre), MCA Youth chief Datuk Dr Wee Ka Siong (left) and MCA deputy president Datuk Seri Liow Tiong Lai (right) leaving after attending the presidential council meeting Tuesday.

 

“They have been rather successful in dealing with social ills that arise as a result of excessive betting.
“The Government should conduct an in-depth study of legalised sports betting in other countries,” said Dr Chua at a press conference after chairing the MCA presidential council meeting here yesterday.

At the same time, the Government must conduct public awareness and education programmes on the social ills of gambling.

“MCA discourages any form of betting. It is well-known that the illegal sports betting syndicates are out of control and have played an increasing role in the black economy of our country – involving money laundering and funding many undesirable business activities,” he said.

The Government, added Dr Chua, must step up enforcement in combating illegal sports betting the way it weeds out illegal 4D businesses.

Meanwhile, the issue continues to get attention in the Dewan Rakyat. Arau MP Datuk Ismail suggested that sports betting be legalised since it involved billions of ringgit and the Government could not gain revenue from the underground economy.

How Fathers Influence Their Daughters' Careers

When it comes to women's career paths, dad's influence plays an increasingly weighty role.

In Photos: Celebrity Fathers And Daughters

Last Father's Day, President Barack Obama published a column in Parade magazine about every father's most fundamental duty: "Show their children, by example, the kind of people they want them to become." 

He praised his own daughters for their poise and patience while reflecting on his own promise to them to be the kind of father he had never had. At 11 and 8, first daughters Malia and Sasha are already showing signs of taking cues from their father. Both are involved in community service projects, including filling backpacks with school supplies, toys and healthy snacks for children whose parents are serving overseas.

All children are shaped by their parents and/or other caregivers, of course, but when it comes to women's career paths, dad's influence plays an increasingly weighty role.

According to a 2009 study from the University of Maryland, women are three times as likely to follow in their father's career footsteps these days than they were a century ago: Only 6% of women born between 1909 and 1916 went into their father's business, compared with roughly 20% of Gen X and Y.

Why the increase? The American Psychological Association says that the changing economic role of women has greatly impacted the role of fathers in their children's lives. Women now comprise over 50% of the workforce, leaving fewer families than ever in traditional "women raise the children" households. Fathers are now spending more time with their children than ever, and experts say that a "father's love" plays a much different role in childhood development. Most specifically, that it develops a child's sense of place in the world.

By Meghan Casserly and Caroline Howard, 06.14.10, 07:30 PM EDT
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Dr. Meg Meeker, author of Strong Fathers, Strong Daughters, is a firm believer that a father's influence is a major factor--if not the single most important one--in the development of women. "A father has authority with a capital A," says Meeker, who says she was influenced by her own father to go into medicine. "From the first years of a girl's life her father is larger than life. She looks up to him, and for the rest of her life she craves his admiration, his respect and his affection." Meeker believes that if admiration, respect and affection are present and reciprocated in the father-daughter relationship, they are the recipe for a successful woman.

These trends by themselves don't tell us which force (paternal, societal or otherwise) is pushing and pulling daughters down one career path or another. But they do tell us today's dads are spending more time with their children--and their daughters are paying attention. Continue on to our photo gallery of 10 successful daughters who have followed in their father's footsteps. Some might even go so far to say daughters who have eclipsed their dad's careers.

In Photos: Celebrity Fathers And Daughters

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Reinventing the wheel -- naturally

June 14, 2010 Enlarge

This is a fanciful rendering of Leonardo da Vinci's Vetruvian Man as a wheel. Credit: Adrian Bejan
  
Humans did not invent the wheel. Nature did. While the evolution from the Neolithic solid stone wheel with a single hole for an axle to the sleek wheels of today's racing bikes can be seen as the result of human ingenuity, it also represents how animals, including humans, have come to move more efficiently and quicker over millions of years on Earth, according to a Duke University engineer.

Adrian Bejan, professor of mechanical engineering at Duke's Pratt School of Engineering, argues that just as the design of wheels became lighter with fewer spokes over time, and better at distributing the stresses of hitting the ground, animals have evolved as well to move better on Earth. In essence, over millions of years, animals such as humans developed the fewest "spokes," or legs, as the most efficient method for carrying an increasing body weight and height more easily.

"This prediction of how wheels should emerge in time is confirmed by the evolution of wheel technology," Bejan said. "For example, during the development of the carriage, solid disks were slowly replaced by wheels with tens of spokes."

The advantage of spokes is that they distribute stresses uniformly while being lighter and stronger than a solid wheel. "In contrast with the spoke, the solid wheel of antiquity was stressed unevenly, with a high concentration of stresses near the contact with the ground, and zero stresses on the upper side," Bejan said. "The wheel was large and heavy, and most of its volume did not support the load that the
vehicle posed on the axle.

"If you view animal movement as a 'rolling' body, two legs, swinging back and forth, perform the same function of an entire wheel-rim assembly," Bejan said. "They also do it most efficiently - like one wheel with two spokes with the stresses flowing unobstructed and uniformly through each spoke. The animal body is both wheel and vehicle for horizontal movement."

Bejan's analysis was published early online in the American Journal of Physics. His research is supported by the National Science Foundation and the Air Force Office of Scientific Research.

"An animal leg is shaped like a column because it facilitates the flow of stresses between two points - like the foot and hip joint, or paw and shoulder," Bejan said. "In the example of the Neolithic stone wheel, the flow of stresses is between the ground and the whole wheel."

Bejan believes that the constructal theory of design in nature (www.constructal.org), which he started describing in 1996, predicts these changes in the wheel and animal movement. The theory states that for a design (an animal, a river basin) to persist in time, it must evolve to move more freely through its environment.

Since animal locomotion is basically a falling-forward process, Bejan argues that an increase in height predicts an increase in speed. For a centipede, each leg represents a point of contact with ground, which limits the upward movement of the animal. As animals have fewer contacts with ground, they can rise up higher with each stride.

"The constructal theory shows us this forward-falling movement is dictated by the natural wheel phenomenon, which is required for the minimal amount of effort expended for a certain distance traveled," Bejan said.

An earlier analysis by Bejan showed that larger human swimmers are faster because the wave they create while swimming is larger and thus carries them forward faster.

While wheel-like movement evolved naturally, it also describes what Bejan likes to call "nature's gear box." Humans have two basic speeds, Bejan said - walking and running. A running human gets taller, or higher off the ground, with each stride, which increases his speed.

A horse has three speeds - walk, trot and gallop.

"The horse increases its speed by increasing the height from which it falls during each cycle," Bejan said. "Then, from the trot to the gallop, the body movement changes abruptly such that the height of jump increases stepwise for each stride. Nature developed not only wheel-like movement but also mechanisms for changing speeds."

Provided by Duke University (news : web)

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Intel in Malaysia for the long haul

By B.K. SIDHU
bksidhu@thestar.com.my

MD: The chipmaker only moving a unit back to US, not shutting any plants

KUALA LUMPUR: Intel, world’s largest chipmaker, is committed to remain in Malaysia even though the rationalisation of its operations will lead to the moving of its assembly and test development (ATD) unit back to Arizona in the United States.

“The wafer fabrication and assembly lines must be close to each other, as there is a need for a lot of interaction because we need to respond to market trends and consumers fairly quickly,” Intel Malaysia managing director Atul Bhargava said.

“Being in different time zones (makes it difficult and that is why) we are moving the unit back to the US. Intel continually optimises its resourcing and business model in line with evolving business needs,’’ he said.

The migration will begin in the first quarter of 2011 and be completed by June the same year.

Atul Bhargava … ‘Our investment in Malaysia is growing every year.’

 

The affected workers, about 500 of them, at the plant in Kulim Hi-Tech Park will be absorbed into the group and redeployed for other job functions at the Kulim and Penang facilities.

“So we are not shutting down any plants. It is just that the ATD development needs to be closer home in the US,” he added.

Intel has been in Malaysia since 1972. It is the largest offshore facility outside the United States for the chipmaker. The company has so far invested US$3.9bil (RM13bil) in Malaysia.

Intel Malaysia comprises three campuses and employs more than 10,000 people.

Intel Penang is a key assembly and testing site, Intel Kulim assembles processor packaging and is an important operations centre for mobile modules, and Intel Kuala Lumpur includes a multimedia super-corridor development centre as well as a sales and marketing office.

Of the 10,000 people employed, 55% are involved in the manufacturing division, 25% in the design of products, and the balance 20% are in services (IT, shared and other service-related areas).

“We are fairly big in doing design work here and our plants are high-tech, so we really need knowledge workers as the job is not about pushing of buttons,’’ Atul said.

As Malaysia marches towards becoming a knowledge-based and innovation nation, it is necessary to have a workforce that is able to work towards achieving that goal.

“If there is one thing I could tell Prime Minister Datuk Seri Najib Tun Razak, it is that the need to change the human capital (development in the country),’’ Atul said.

He said improvements were needed in the systems adopted by local universities and they should strive to become the world’s Top 100.

They need to change the curriculum to be industry friendly and adopt newer methods of teaching. Only then can talent that can help the country in the innovation phase be created.

“I have been advocating the need to do it either organically or hook up with institutes like MIT; make that quantum leap, emulate, so that people will know us,’’ he said. (MIT refers to the Massachusetts Institute of Technology in the United States.)

Asked whether Intel would follow Western Digital and invest more to expand its operations in the country, Atul said: “Our investment in Malaysia is growing every year as we are here for the long haul.

“We have worked hard and diversified, we have the latest technology here, and we are committed to stay. But just like other companies we move around for the needs of our customers.”

(Western Digital recently announced it would invest about US$1.2bil in Penang.)

Atul said in whatever Intel did, it made sure there is benefit to the company, the country and the consumer.
 
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