| Finance Minister P Chidambaram thinks he has found a possible solution to the chronic problem of poor delivery mechanisms for social infrastructure in India: involve the private sector.
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| As he told the Confederation of Indian Industry’s post-Budget gathering with restrained drama, “I ask you to send your young executives for two or three years. It might involve a financial sacrifice. We will pay them what the government can afford to pay. You can top it up with some money.”
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| The suggestion sounded great; it’s the ultimate “private-public partnership”, the term that is so much in vogue these days. But I would be willing to bet that it is unworkable and more public money will end up being thrown after bad.
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| This is not because corporate India would be unwilling or lack the high-mindedness to assign executives for such prima facie noble causes.
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| Indeed, there are many corporate groups that contribute generously and effectively of their time and money to social work. So why do I think this delivery-mechanism solution will be unsuccessful? Because of a collective corporate failing: the near-absence of the concept of service and efficient service delivery.
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| India Inc has certainly made some impressive strides in the 13 years since liberalisation in terms of manufacturing efficiency, productivity and growth — the entry of three more Indian corporations to the Fortune 500 list on Tuesday is testimony to that.
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| But it is fair to say that the quest for growth and expansion has not been matched by optimal service delivery, despite India’s growing reputation as a global hub for IT services.
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| To understand this better, think of any good or service you have bought from a private sector company in the recent past: a car, credit card, cellphone, computer, broadband, a home loan, electricity connection and so on and so forth.
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| Think again: have you been satisfied with the service that accompanied these purchases? Even a dipstick survey among colleagues in Business Standard’s Delhi office suggests that the answer is a resounding no.
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| Everyone had complaints, some of them serious, some of them absurd. There is the cellphone service customer care exec who told a colleague requesting — for the nth time — a reconnection of outgoing calls that he was “taking too much advantage of being a customer”. There is the service engineer of a broadband company who could not provide services to a new office despite demanding payment in full.
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| The home loan company that took five reminders, including an office visit, to record a change of address. The service contractor for a computer hardware company that could not fix a fault — for months. The credit card company whose credit card never arrived. The electricity vendor whose linesmen never turn up...
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| The list not only goes on and on — I am sure readers will be happy to add to it — and it includes some big names in corporate India. Significantly, not all of them are Indian corporations either, multinationals are no less accountable.
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| What have all of these consumer complaints got to do with private sector participation in bringing sanitation, water, health-care, education and food to India’s poor?
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| The short point is this: if corporations in India cannot deliver optimally on services that involve fully paid-up commercial transactions that are backed by expensive infrastructure and resources how can they possibly help the government deliver public goods in circumstances that are far more challenging?
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| Delivering social services is not the same as hard-selling a car or a credit card; it requires an attitude to service that must be ingrained. In this respect, it is hard to see what expertise a corporate executive can provide the government that a talented bureaucrat — of which India has no dearth — cannot.
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| In a strange way, the problem is a legacy of our political economy. As long as the government dominated commercial activities and competition was restricted service was a non-issue simply because corporations did not have to compete too much.
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| That is why for Indian marketing and sales executives, the commercial relationship tended to end with the sale and old habits die hard, as the cliche goes. Things are changing — you only have to look at the way the automobile and IT industries are developing to understand how — but not enough to turn the private sector into a model of service efficiency yet.
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| The finance minister is right in suggesting that civil society needs to be more engaged with India’s social problems. But equally, India needs a lot more competition to teach the private sector the art of effortless service before its corporations can contribute meaningfully to the kind of partnership Chidambaram has in mind. |
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