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Creation of Wealth By DR T.H. CHOWDARY Director: Center for Telecom Management and Studies Fellow: Tata Consultancy Services Chairman: Pragna Bharati (intellect.

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Presentation on theme: "Creation of Wealth By DR T.H. CHOWDARY Director: Center for Telecom Management and Studies Fellow: Tata Consultancy Services Chairman: Pragna Bharati (intellect."— Presentation transcript:

1 Creation of Wealth By DR T.H. CHOWDARY Director: Center for Telecom Management and Studies Fellow: Tata Consultancy Services Chairman: Pragna Bharati (intellect India ) Former: Chairman & Managing Director Videsh Sanchar Nigam Limited & Information Technology Advisor, Government of Andhra Pradesh T: +91(40) (O) ® F: +91 (40) BITS Hyd: 5 th Sept 2012

2 Wealth is of two kinds Intellectual Material, economic Intellectual wealth does not diminish. The more you share, the more it grows Material wealth has limits. We may be satiated but not satisfied. Material/economic wealth diminishes on consumption Intellectual wealth cant be diminished or destroyed. eg. Germany, Japan, after the wars THC_CTMS2S672_Sept12

3 Source of all wealth Nature Whatever is in the Sun is on earth- 110 elements Intellect can create wealth even without natural material resources eg: Singapore, Taiwan, South Korea, Japan THC_CTMS3S672_Sept12

4 Land & Sea Adam Smith: Land labour & capital Unless there is a great land mass, there cannot be natural wealth- ores, coal, oil & gas, forests, rivers, mountains Russia, Canada, USA, Brazil, China, India – vast lands Urbanisation –masses of population Pressure on land- Density of population high to reduce commutation costs Suburban land holders become wealthy by sale of land to Realtors! Skyscrapers and sub terraneons (Japan & Netherlands) structures THC_CTMS4S672_Sept12

5 Factors for wealth creation Labour - Diminishing role Electricity, motor, machines, Robots Eg: Toyota Factory near Tokyo; 360 Robots, 60 men 1000 cars/day Intellectual labour Innovation, invention Scandinavia Now China too ( to be competitive) USA- Robotizing to bring back manufacture THC_CTMS5S672_Sept12

6 Capital is crucial Comes from savings Savings in Banks Banks lend & invest (Commercial & Investment Banks) Public Limited company –Great invention – limited liability ; millions of investors - not dividends but capital appreciation Stock exchanges Regulators (RBI; SEBI) THC_CTMS6S672_Sept12

7 Vision, entrepreneurship, risk & rewards (1) We will make electricity so cheap that only the rich can afford to burn candles. -Thomas Alva Edison (1978) Ghar Ghar Mein Radio Gaon Gaon Mein Telephone -THC (1997) Hath Hath Mein Telephone; Gaon Gaon Mein Internet - THC THC_CTMS7S672_Sept12

8 Vision, entrepreneurship, risk & rewards (2) Genius is one per cent inspiration and ninety nine percent perspiration When Sir M.Visveswaraiah saw the Cauvery water falls at Jog ( 1920s) he exclaimed what a waste? When Jamshetji Tata saw the waters of Roha river Roha cascading down he wondered, All this water from the Western Ghats is wanted. We should harness it to produce hydro electric power. THC_CTMS8S672_Sept12

9 Wealth Creators Risk-takers Entrepreneurs Failures dont deter Leaders- Integrators of talents Andrew Carnegies Tomb-stone Here lies buried a man who knew how to hire people better than himself Lee Iacocca: Chrysler Revival THC_CTMS9S672_Sept12

10 Tatas & Wealth Creation (1) Cotton Textile Mills Nagpur Swadesi Tata Steel, Sakchi becomes Jemshedpur Vivekananda Inspires Indian Institute of Sciences (IISc, Bglr) Steam locomotives for Railways Trucks Tata Hydro Tata Shipping Tomco –Coconuts (Kerala) Tata Chemicals – Sea water Indica & Nano THC_CTMS10S672_Sept12

11 Tatas & Wealth Creation (2) Andhra valley Western Ghats Artificial Lake Air India Intelligent Grid Tata Tea TCS Taj Hotel THC_CTMS11S672_Sept12

12 Some Modern Indian Wealth Creators Birlas Mahindra Godrej KCP (1930) Andhra Sugars (Mullapudi Harischandra Prasad) Amara Raja (Galla Ramachandra Naidu) Ambanis Munjal Infosys, Wipro, HCL, Infotech…. THC_CTMS12S672_Sept12

13 Patriot Industrialists Ogale Glass works Dabur Bengal Chemicals Birlas, Dalmias Bajaj Verghese Kurein THC_CTMS13S672_Sept12

14 Corporate Social Responsibility (CSR) Indian Institute of Science TISCO: Free Schools, Hospital, Insurance, Pensions Tata Trusts Tata Scholarships (ICS…) All wealth (dividends) goes to various trusts Tata Institute of Fundamental Research ( TIFR) BARC and ISRO Tata Institute of Social Sciences THC_CTMS14S672_Sept12

15 Sharing as an ideal Saha yagna praja srushtva purovacha praja pathihi Anena prasavishyadhvam eshavaha tu ishtakamadhuk. – BG 3.10 Devanbhavayathanena te deva bhavayanthu vah Parasparam bhavayanthaha sreya paramavapsyadaha. -BG 3.11 Ishtanu bhogaan hi vo deva dasyanthe yagnabhavitaha Tairdatthana pradayaibhyo yo bhunkthesthena yeva saha -BG Bhunjathe thvagham papaye pachanthyathma karanaath. -BG 3.13 THC_CTMS15S672_Sept12

16 Sharing as an ideal Eesavaasyamidam sarvam yatkincha jagatyaam jagat, Tena tyaktema bhujithaah; Maa grithah kasya swith-dhanam. Everything in the universe abides in the Supreme Being. Realise this well; realising it cast off the desires that rise in the heart, for example, the thought of possessing what is enjoyed by another. Joy comes only by the giving up of desires and attachments. (Enjoy by renunciation of and sharing with others of what more is not needed by you; may you not accumulate; whose is this wealth?) -Isavaasya, Interpretation by Rajaji. Let us all strive to live in the light of this wisdom. THC_CTMS16S672_Sept12

17 Wealth Destroyers Export of ores Welfare before wealth (NREGA, Fee Reimbursement, paavala vaddi, no vaddi, loans waivers…A.Ps profligacy; give –aways (Radios, TVs, grinders, bicycles, shoes, sanitary napkins, tablet PCs, mobile phones, Haj & Jerusalem subsidies; Urdu ghars, shadi khanas; one-Rupee /Kg ; No Rupee-Rice. Since fiscal 2004 G.O.I spent Rs tln on various subsidies On NREGA cumulative spend Rs tln A PURA Hub requires Rs. 600 mln; upgrades 10 to 50 villages 7000 PURA Rs. 4,20,000 cr would create R-Urban areas Gram-IT is part of it. THC_CTMS17S672_Sept12

18 You cannot… You cannot bring about prosperity by discouraging thrift. You cannot strengthen the weak by weakening the strong. You cannot help the poor by destroying the rich. You cannot establish sound security on borrowed money. You cannot keep out trouble by spending more than you earn. You cannot build character and courage by taking away mans initiative and independence. You cannot help men permanently by doing for them What they could do for themselves. -Abraham Lincoln (Source: Freedom First, May 1989) THC_CTMSS672_Sept1218

19 Tainted and tattered flag of Socialism (and secularism) (1) Sri Nani Palkhiwala History will record that the greatest mistake of the Indian republic in the first 50 years of its existence was to make less investment in human resources- education, family planning, nutrition and public health- than in brick and motor dams and factories. We have too much government and too little administration; too many laws and too little justice; too many public servants and too little public service; too many controls and too little welfare. Indian liberalisation encounters formidable opposition from three quarters. The top heavy bureaucracy reluctant to shed its enormous powers Influential politicians who prefer to let socialism remain the opium of the people and of whom it can be truly said that if ignorance is bliss, they should be the happiest men alive. THC_CTMS19S672_Sept12

20 Tainted and tattered flag of Socialism (and secularism) (2) – Quite a few Indian businessmen men who are much interested in their own personal prosperity than in the future of the country and who preferred to flourish in the non competitive environment. – These three are the obstructionist forces…India continues to remain the only significant country in the free world to hold aloft the tainted and tattered flag of socialism. We shut our eyes to the fact that socialism is to social justice, what ritual is to religion and dogma is to truth. Over taxation corrupted the national character overtly. The nation survived only because the tax system continued to breathe through loopholes and the economy used to breathe through window of tax evasion. THC_CTMS20S672_Sept12

21 Socialists service to the poor and aam aadmi ( one example) Power bills (July 2012) of A.P Ministers MinisterGalla ArunaM.Mukhesh Goud DK Aruna Danam Nagender E.Pratap Reddy Amount (Rs.) 62,65733,18825,01317,23111,021 N.Chandra Babu Naidu Kiran Kumar Reddy 84,352100,000 Some have 12 air conditioners in their house. Rule:2 MLAs ( from allover the state) have private houses in government allotted sites in Jubilee/Banjara Hills. THC_CTMS21S672_Sept12

22 Books for Reading (1) The Reckoning Vitality in a Business Enterprise: -Frederick R. Kappel Big Business & Human Values -Theodore V. Houser: Chmn sears Roebuck The Uncommon Man - Crauford H. Greenwall, President E.Idu Pont de Nemoars & Co Freeman & The Corporation -Roger M. Blough: Chmn United States Steel Corpn New Frontiers for Professional Managers -Ralph J. Cardiner : President General Electric Company. THC_CTMSS672_Sept1222

23 THC_CTMSS669_July Books for Reading (2) How to Win Friends & Influence people – Dale Carnegie The Human side of Enterprises - Douglas Mcgregor My years with General Motors – Alfred P Sloan A Japan which can say No to America Kautilyas Artha Sastra Are You Listening – Dr T H Chowdary The Creation of Wealth – R M Lala (The Tatas from 19 th to the 21 st Century) Vincent People Peter Drucker It Couldnt be Done - Published by the USIS, New Delhi Heidi & Alwyn Toffler – The Future Shock – The Third Wave – A new civilisation in the making

24 THC_CTMSS669_July Books for Reading (3) Shantiparva in Mahabharata Sundara Kanda (Ramayana) – Hanuman to Sita Gita Rahasya by Lokamanya Tilak Bharthriharis Subhashitas Sumathi & Vemana Satakas Rama Charita Manas – Tulasi Das Krishnavatara – KM Munshi Women in the Bible Life and Times of Jamshedji Tata (For the Love of India by R M Lala) JRD Tata Letters

25 Lives of great men all remind us we may make our lives sublime and departing leave behind us foot prints on the sands of time. – Henry Wadsworth Longfellow THC_CTMSS672_Sept1225

26 Dhanyawad: Thank You THC_CTMS26S672_Sept12

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