Monthly Archives: March 2014

Top 12 Challenges Facing India in the Decades Ahead – 03 – Accountability & Corruption

According to Transparency International, in 2013, India ranks 94th out of 177 countries, with a score of 36, on the Corruption Perceptions Index which measures the perceived corruption in the public sector. In other words, while there are 83 countries that are perceived as more corrupt, there are 93 countries that are less corrupt. In comparison, the US is 19th with a score of 73, Canada and Australia tie for 9th with a score of 81, and New Zealand is seen as the least corrupt country with a score of 91. In other words, corruption is still quite bad. In comparison, China is 80th with a score of 40 and Brazil is 72nd with a score of 42. Corruption has become such an endemic feature of Indian administration and commercial life that in some parts of the country nothing moves in the intended direction until the palm of the deliverer is greased. (Dreze and Sen, An Uncertain Glory)

In addition, Bribery is a huge problem. In back to back studies in 2005 and 2008, Transparency International found that, despite efforts to curb the practice and corruption, the number of people who had first-hand experience with (and had to pay) bribes only dropped from 62% to 40%. In other words, 2 out of every 5 Indians had to fork over bribes to get a basic service that they were entitled to (such as getting a birth certificate or a passport) from a public official. Corruption is so bad that a NGO (non-governmental organization) by the name of 5th Pillar distributed over 1.3 Million zero rupee notes (modelled after the 50 rupee notes) between 2007 and 2011 in an effort to fight corruption.

Zero Rupees

As clearly stated by the Accountability Initiative, spawned by the Center for Policy Research, Dharam, Marg, Chanakyapuri, New Delhi, there is surprisingly little regular, reliable and most importantly, accessible information on the implementation of service delivery programs in India today. And that’s being politically correct to the nth degree. Dreze and Sen are more accurate when they state that, in An Uncertain Glory, particular to India is the combination of insistence — for entirely plausible reasons — on having a large public sector, combined with a fairly comprehensive neglect of accountability in operating this large sector.

The issue of accountability is particularly important when discussing the many infrastructure issues in India. The neglect of both physical infrastructure (such as power, roads, water, sanitation, etc.) and social infrastructure (education, health care, opportunity for employment, etc.) is extremely widespread. One of the biggest examples failure of public accountability is the crippling power blackout of July, 2012 which plunged half of the country into darkness and earned India the reputation of the blackout nation. This is a prime example of the lack of accountability as even the central guardians of the Indian power strategy at the highest level face little pressure to get things right and are not tasked to take responsibility for the terrible state of power planning in India (where double digit percentages of the power generated is stolen and where significant amounts of generated power is wasted). Consider the story of the National Thermal Power Corporation (NTPC) and the Govind Ballabh Pant Sagar power plant in Uttar Pradesh as recounted by Dreze and Sen. When one of the authors visited the NTPC headquarters on a campus near the plant, he found that a large number of air conditioners were switched on full blas throughout the day, even in the deserted lobby of the guest house. Just outside the boundary walls of the campus, people from the Dom community, working as ‘sweepers’ for the NTPC for twenty five years, live in shacks without any electricity. When asked why they tolerate the situation, they said they feared they would lose their jobs if they complained about their predicament.

It is the lack of accountability that allows corruption, and bribery, to continue to flourish. Corruption flourishes in informational darkness. Until there is more transparency, information accessibility, and accountability in India, it will continue to flourish. This lack of accountability combined with a general belief that certain kinds of bribery and corruption are standard behaviour that is to be expected is posing huge problems for India and limiting its progress. If there was less corruption, there would not only be more accountability, but more money available to address some of the serious physical and social infrastructure problems that we addressed in previous posts.

Geek Cat Still* Says

Geekcat Still Says

Geek Cat

You know I never
I never heard you talk so good
You never chat the way you should
But I like it
And I know you like it too
The way that I want you
I gotta have you
Oh yes, I do

You know I never
I never ever get home late
You know that I can hardly wait
Just to ping you
And I know you cannot wait
Wait to ping me too
I gotta chat you
Cause baby we’ll be

On the Facebook
In the Farmville pen
Behind the bushes
Until I’m begging again
In the chartroom
Lock the public out
And baby
Talk qwerty to me

Again, many apologies to Poison. Many, many apologies.


* He hasn’t changed his tune in three years!

The USIS was Established 80 Years Ago Today

On November 17, 1933 Franklin D. Roosevelt signed Executive Order 6433-A and created the National Emergency Council (NEC), sing an appropriation authorized by Section 220 of the National Industrial Recovery Act of June 16, 1933, in response to the declaration by the Congress of the United States of the existence of an acute national economic emergency which affects the national public interest and welfare.

The NEC was deemed created for the purpose of coordinating and making more efficient and productive the work of the numerous field agencies of the Government established under, and for the purpose of carrying into, effect, the provisions of the National Industrial Recovery Act, the Agricultural Adjustment Act, and the Federal Emergency Relief Act that were all signed into law in 1933 in response to the Great Depression.

Six months later, Clara M. Edmunds, head librarian of Franklin D. Roosevelt’s public information service, opened the U.S. Information Services library, which was designed to be the comprehensive collection of relevant government documents, updated regularly to record every development in the legislative, executive, and judicial branches of the government. This library, which centralized information about federal rules, regulations, and administrative orders for the public, was the first one-stop-shop for government information until 1948. In 1945, Truman, who had no interest in funding it, took office. In 1946, the USIS was put under the state department and had its funding reduced. And in 1948, the Smith-Mundt Act, which focussed on the creation of an information service to disseminate information abroad about the United States (instead of to its own citizens) put the final nail in the USIS coffin. (One account of the United States Information Service Libraries can be found in the online archive of the University of Illinois Graduate School of Library Science. Information can also be found in A Timeline of Events in the History of Libraries.)

It may have only lasted 15 years, but it was a revolution in government information management and deserves to be remembered.

The (Board) Gamer’s Guide to Supply Management Part : Agricola, Part II-A

So, you think you’ve mastered the basic game of Agricola, and can now manage the basics of an industrial farm at the back-end of your agricultural supply chain. With your limited resources, you can deftly balance growing food with feeding your family (investing in crops versus paying your workers), expanding your farm and/or family versus maximizing the return from what you have (and trading off short-term gains today for long-term gains tomorrow), improving your infrastructure (by upgrading your buildings and making them more resistant to the elements and lowering their annual maintenance costs with some up-front investment) versus focussing on your fields (plowing and sowing your fields) versus raising and breeding animals (and the supply and demand dynamics of the meat-eating versus vegetarian marketplace), growing grain versus vegetables (and the internal dynamics of the basic commodities market), and raising sheep versus pigs or cattle (and the various preferences of different locales, taking into account that Americans love their bacon and Hindus don’t eat their cows). You think you have it all figured out and end every game with a fully utilized farmyard, a nice balance of crops and animals, a big family, and a better homestead than your peers. Think again.

Just like the real world agricultural supply chain isn’t this simple, neither is the full version of Agricola. Adding in the occupational and minor improvement cards adds a broad range of new elements to the game and greatly increases the complexity and available dynamics. Basic strategies go out the window as you try to find new and innovative ways to build a better farm than your rivals, who now have access to new skills, equipment, and innovations to acquire food, grow crops, and raise their animals. Just like every innovation in the real world pulls the rug out from under your proverbial supply chain feet, every occupation and minor improvement has the potential to completely change the balance of power, especially when these occupations are skillfully paired in a complementing manner.

There are 66 basic occupation cards, which include:

  • Merchant: his skills in trade allow you to take an action a 2nd action for the cost of 1 food, just like skilled merchants always find a way to take advantage of the situation
  • Seasonal Worker: his services double the amount of grain or vegetables you can harvest, just like more labour in the real world speed the harvest
  • Stone Carrier: this strong man can harvest stone from the quarry twice as fast as the average labourer, just like a skilled labourer is much more effective than an unskilled one
  • Frame Builder: this skilled tradesman allows you to mix wood and clay and still build a solid structure, just like the best engineers know how to mix materials for the best construction
  • Organic Farmer: his ability to command a higher price for his crops allows you to get more for animals that get to free-range graze (in uncrowded pastures)
  • Maid: provides you with one food at the start of each round, as part of her job is to bake and cook (while you plow, sow, and harvest)
  • Plow Driver: this day labourer allows you to plow 1 (extra) field each round for the cost of 1 food
  • Chamberlain: this market manipulator allows you to take actions before your peers have the opportunity to do so, just like an inside man gets you access to new technology before your peers
  • Stablemaster: this master shepherd allows you to hold more animals in unfenced stables than you could otherwise, just like a real shepherd can keep a heard in line without having to fence it in
  • Mendicant: this master begger is immune to the effects of (up to) two begging (debt) cards

And even though these are just 10 of the 66 basic occupation cards, and there are 41 more available in a 3-player game and a total of 103 more available in a 4 or 5-player game, you can quickly see how each occupation provides you with a skill that can significantly impact your strategy.

If you have the seasonal worker advantage, you will focus on plowing and sowing fields early in the game, as you will be producing grain and vegetables twice as fast as your opponents, and will quickly lock-in your ability to produce food and extend your family. If you are the organic farmer, you will play a live-stock centric game and build lots of pastures because you won’t need many animals to rack up animal-based points. If you have the maid, you can focus more on building early on as you will need less food to progress to the later rounds. If you have the Stablemaster advantage, you will build lots of stables early as this will allow you to keep lots of animals without needing to acquire the wood required to build lots of fences. If you are the Mendicant, then you will use this to your advantage in the later rounds to avoid the need to feed two family members and take extra development actions instead. And if you are the Chamberlain, you’ll use this insider’s advantage to stay one-step ahead of your rivals who will have to double-down into their chosen strategy to try and keep up with you.

Just like specialists in the real world give you a competitive advantage and alter your supply management strategies, so do specialists in Agricola. The right ability at the right time can not only significantly alter your best strategy, but even give you a considerable edge over your rivals if they don’t have an skills of comparable worth. And the wide variety of potential skills, and combinations thereof (as your family members can partake in multiple occupations) can make it a different game every time (just like every go to market event is distinct from an informed sourcing perspective). This is what makes Agricola one of the best games out there for sharpening your supply management skills, and a great foundation for getting yourself ready for the ultimate supply management challenge. More to come!

Is MRO Inventory Bogging You Down? Maybe You Need a Bit of Xtivity? Part II

Yesterday, we finished Part I by asking What is Xtivity?

Simply put, Xtivity is a solution for your MRO Inventory Optimization Needs and only your MRO Inventory Optimization Needs. If your organization is regularly managing tens of millions of dollars of inventory, or more, you probably know that MRO Inventory is costing you Millions and your current ERP/MRP/CPG Inventory Management systems aren’t helping you curb these costs while making sure that the part is always there when you need it. (Because, in the MRO world, unlike the CPG world or back-office world, availability always trumps cost savings. If you’re a retailer and you are out of stock on 2% of your catalog, no big deal, especially when the average stockout rate is 8%, and if your supply cabinet runs out of toner when the CFO wants to print out 500 pages of financial reports, you can just send a low-wage employee to the local office supply store to pick up a replacement. It’s annoying, but the most it’s going to cost the organization is an hour of someone’s time and maybe a 20% markup on a $50 cartridge. Big whopping deal, NOT! But if it costs 1 Million a day to run the production line and the company’s entire factory workforce sits idle for three days while your repair technician waits for a part to be express shipped to the Brazil factory from a supplier in China, a single stock-out can be the difference between the organization turning a big profit and suffering a big loss for the quarter.)

Accepting this reality and realizing that traditional ERP/MRP/CPG Inventory Management systems weren’t going to solve this problem (which is typically solved by the average company by significantly overstocking a critical replacement part in multiple locations), ten years ago, Xtivity formed to do something about it and nine years ago launched one of the first SaaS solutions to address the issue.

The xIO Software-as-a-Service platform is a 100% web-based MRO Inventory Optimization Solution that can plug into your current inventory management and procurement solutions, suck in your inventory (related) data, pass it through a number of proprietary and statistical models and algorithms, developed by Dr. Stephen Pearce (formerly of Texas A&M and author of Strategic MRO: A Roadmap for Transforming Assets into Competitive Advantage) and refined over the last decade for optimal performance across all of the major MRO industries (including Pharmaceutical, Oil & Gas, Automotive, Power Generation, Pulp & Paper, Automotive, Food Manufacturing, and Transportation), and output, on a monthly basis (or any other regular interval that makes sense from an operational perspective) the optimal order point, order quantity, and average lead time required for each MRO inventory item (by location) — taking the client’s business rules into account. The net result is increased part and material availability and fill rate, accurate lead time calculations, and cash-flow savings from reduced inventory across the board. Based on this information, the xIO solution then generates reports that recommend the suggested changes to future orders and calculates the expected savings both in inventory carrying costs and year-over-year cash outlays for MRO inventory.

But it doesn’t stop there. For each individual item it creates a detailed inventory report that shows the trend over the last 36 months, the projected trend, the expected savings from the initial change to the order frequency, and the expected MRO inventory savings over time. All of the data that go into the summary reports and report by inventory category (defined by inventory velocity) can be drilled into and all of the data (and reports) can be exported to Excel (if desired). And once the suggested changes are accepted, the Xtivity solution can push the new order points, order quantities, and lead times back into your inventory management solution which will take over the ordering, tracking, and classic inventory management functions.

Xtivity, which is well known in the reliability, maintenance improvement, and big MRO space, if not in the broader supply chain management space as a whole, has become so good in its niche that they are at the point where their average client sees a ROI in 90 days or less and 10x ROI over time. Plus, 99.99% of clients can use their solution out of the box. They support so many inventory systems and data formats (in addition to being SAP and Maximo certified) that they only had to do a custom data conversion project for 2 out of the last 1,000 global companies (of a solution that supports, and supports users in, 6 languages) that have tried their platform.

When Xtivity says xIO is a true SaaS solution with no hardware, software, or integration requirements that plugs the MRO optimization hole with virtually no effort (beyond an inventory manager reviewing the order point, order frequency, and lead time recommendations and approving them for push-back into the inventory management system), Xtivity means it. The entire application has been streamlined to not only optimize MRO inventory management and free up as much cash as possible without increasing operational risk, but to minimize the amount of effort required to get results. This is important because you generally don’t generate business value by wasting time on software support, you generate value by implementing and maintaining better (MRO) inventory management policies. And the Xtivity solution allows you to focus on operations, not software, and thus get a quick return. It fills its niche very well. So if you are looking to improve your MRO inventory management, and potentially free up Millions of dollars in cash-flow, check out the Xtivity xIO solution, it’s easy to try and very easy to use.  (For more information on Xtivity, they can be contacted at optimize@xtivity.com.)