Saturday, September 27, 2014

Strategic Spirituality and Soulful Development: A Combination That Drives Equitable Socio-Economic Development

Strategy in a business or organizational sense is highly material. It is all about generating and utilizing resources, and equally about creating and deploying wealth. All factor resources, natural or synthetic, are utilized to advance businesses in pursuit of growth. Over time, a highly capitalistic approach was proven to be a more efficient creator of wealth but a less effective enabler of social activity. While alternate forms of public ownership (Russia), mixed socialist economy (India) and totalitarian (China) have differentially influenced resource and wealth generation paradigms, strategy has evolved as an instrument that transcends ownership and influences resource and wealth in societies and economies. Many times, these economic systems exist and evolve in combination with political systems such as controlled elections, total democracy and command & control administration to deliver relevant results.

Societies and governments have recognized that societies must get back certain portion of wealth generated through successful strategies; so have highly successful entrepreneurs and businessmen. Bill Gates and Warren Buffet have been the leading business lights in US who channeled a large proportion of their wealth into charitable and philanthropic activities. In India, founders of a few major groups such as Wipro, HCL, GMR and more recently Vedanta have pledged 12 to 75 percent of their wealth philanthropic and charitable activities. While such acts are dependent on voluntary commitments by such successful leaders, the legal framework of Corporate Social Responsibility (CSR) developed in India under the new Companies Act 2013 signifies the desire of regulators to somewhat compulsorily channel business profits (based on certain criteria) into acts of development for the underprivileged sections of the society.
Many approaches, one source
There are, as summarized above, many approaches, ranging from voluntary to compulsory, that may channel pre-existing and created wealth to causes of social equity. The source for all the approaches, however, is profitability. That said, higher profitability does not necessarily mean higher social contribution. Profitability that arises from usurious squeezing of factor resources or excessive skimming of consumer surplus may be seen to be socially exploitative. Any social investments that are made from such unnatural profitability may be seen to be a distorted form of social contribution. The policy of contribution after substantial generation places the choice and discretion in the hands of businesses in that profits are earned first and deployment is considered next (if at all). The much repeated saying of businesses that they must give back to society what they take from society arises from the first principle of earning allocable profits first, before any deployment can be made.
More fundamental than profitability is strategy that generates profitability. A smart strategy identifies and fulfills latent and established (and even hitherto unknown) consumer needs through efficient design, manufacture and delivery of products or services and in the process optimizes investment-expenditure-cost-profit relationship. There is a view that there can be no right or wrong strategy but only right or wrong execution. This is an oversimplification of the strategic process. For example, it is not appropriate to hypothesize that being the 100th firm in a million unit market is a right strategy and execution will take good care of such a pedestrian strategy of market and resource fragmentation. Right strategic process involves an inventive mind, prudent resource management and revenue generation without compromise to profitability. For businesses and organizations to be socially responsible they must first be economically responsible.
Economic responsibility
Economic responsibility is a less understood concept. While the old adage says that time and money once spent cannot be got back, there is a reluctance to accept money as a factor that is as valuable as time is. Such reluctance is due to the popular perception that money always buys something in exchange, and often generates more money. That said, few realize that money, though a manmade currency, is a finite amount that has a relationship with the overall efficiency of a national economy. Living beyond means or means that trail the living aspirations lead to a negative spiral of deficit financing and inflation. Like nations, businesses and organizations must live within means or expand the means at unit level. Concepts of globalization and cross-border pooling of costs and profits have impacted the ability to incisively track economic responsibility at unit levels.  
Growth in population and aspirations requires more products and services, the inputs for all which come from nature. In such a context, economic responsibility can be best expressed in terms of three basic concepts. The first is doing more with less, both in terms of natural and synthetic resources. The second is to conserve natural resources by prudent utilization and efficient exploitation. The third is to renew the natural resources by recycling. An economically optimized society would follow a normal distribution where poverty and luxury, by value, are both minimized and the core of the society has the maximal coverage of value. In normal distribution mean, median and mode (of incomes) converge. A true egalitarian society is one in which the standard deviation of the incomes is such that 68.2 percent is within one standard deviation of the set, 95.4 percent is within two standard deviations of the mean and 99.7 percent is within three standard deviations. Egalitarianism is hard to get in human societies which require materialism and capitalism to crate productive economic activity in increasing measure. 
Concentration of wealth is a concomitant of capitalist and free market economies. Even controlled economies that have injected a measure of capitalism have experienced concentration of wealth. While creation of jobs and improvement of economic conditions is one way of economic development, voluntary de-concentration of wealth provides periodic trigger and sustainable stimulus for efforts aimed at economic egalitarianism. Azim Premzi of Wipro has pledged 25 percent of his wealth of USD 16 billion. Shiv Nadar of HCL has pledged 10 percent of his USD 11 billion wealth while GM Rao of GMR has pledged 12.5% of its wealth of USD 2.6 billion. Today, Vedanta group chairman, Anil Agarwal is reported to have stated that he would give away 75 percent of his wealth of USD 3.5 billion to charity. Globally, Bill Gates and Warren Buffet together donated USD 69 billion to Bill and Melinda Gates Foundation. Such initiatives help in de-concentration and diffusion of wealth for social good.
De-concentration helps kick-start major philanthropic and charitable initiatives. WHO in the past and the Gates Foundation in recent times have contributed to eradication of multiple diseases, including polio. There is no doubt that periodic availability of billions of dollars helps the governments, private organizations and public-private partnerships take up transformative measures in the social arena. Eradication of poverty, disease and squalor, including national transformative programmes like Swach Bharat, require massive allocation of funds. Voluntary measures of de-concentration and diffusion of wealth, without doubt, are vital elements of social equity. Given that strategy is the key driver of wealth generation (or wealth erosion), strategy needs to be viewed an important component of de-concentration.
Given that ‘earn and distribute’ of the above type takes years, and even decades, of industrialization and business growth to happen, development of nano, micro, small and medium industries (together micro industries) in an aggressive manner is a strategy to distribute wealth ab initio. Such enterprises create greater employment opportunities and thus contribute to income redistribution. In a similar manner, proliferation of service activities helps self-employment of a large proportion of population. Infrastructure and transportation provide major avenues for employment. Here again, diversification of infrastructure across the nation (for example, developing 12 ports along a State coastal line rather than I mega port) helps in enhanced and diversified economic activity and consequent employment generation. Transportation services are also some of the biggest generators of employment.
Micro-businesses require micro-technologies, standardization and ancillary networks to succeed. An automobile typically comprises thousands of components. Of these, at least a few hundred components lend themselves to micro-enterprises.  For example, nuts, bolts, washers can be standardized in design to be of universal design. Micro-technologies can focus on standardized designs and support manufacture with compact and high technology machine tools. Well developed ancillary networks can help micro enterprises cater to mega automobile makers. Electronics, electrical and telecommunication industries constitute another example of the pyramid of manufacture with micro enterprises supporting mega electronic products. This kind of industrial and economic development may be characterized as development with soul. Soulful development, which is development that reflects the inner good qualities of human life, requires a spirit of strategy that is unique and different from the one that is deployed solely for  commercial purposes.      
Strategic spirituality

Spirituality has many definitions and interpretations. For the purpose of this blog post, spirituality is the quality of being connected with humanism and human spirit. Humanism is a system of thought that seeks to solve human problems with the help of reason. Spirit is a state of mind that reflects courage, determination to progress. Strategic spirituality integrates the human dimension in every aspect of the corporate, business and functional strategies. From defining the industrial structure of development and manufacture of a product (huge integrated monolithic structure versus diffused multi-tier diversified structure) to calibrating functional strategies in line with socio-commercial considerations (products as revenue generators versus products as social instruments), strategic spirituality adds a distinctive humanistic face to commercial strategies.
A leading manufacturer of personal hygiene products has interest in promoting product sales. By undertaking a massive programme for girl child education (which will improve perceptions on personal hygiene), the company can combine social and commercial purposes. Leading manufacturers of sanitary hardware (companies such as Cera) which have seen multi-fold increases in their market capitalization in anticipation of Swach Bharat mission would do well to develop a range of customized products to provide affordable solutions to the national mission. Leading manufacturers and marketers of food products can leverage diversified culinary skills of housewives to develop portfolios of low volume-unique taste products. Possibilities are endless; chief executives and strategists must embrace strategic spirituality as a larger professional purpose in life. Strategic spirituality leads to soulful development; development that blends economic growth with social equity.
Posted by Dr CB Rao on September 27, 2014          


Sunday, September 21, 2014

Sustainable Success through Competencies: From Mere Assembly to Strategic Alchemy

Apple’s recently launched new phones, iPhone 6 and iPhone 6Plus, have received highly favorable reviews. Apple’s foray into the field of larger smart phones and phablets through these two phones, long after Samsung pioneered this segment (followed by a host of other companies), has been much appreciated. There has been no evidence that Apple has suffered any of the launch and sales blues that a late follow-on competitor in a crowded market space typically suffers. Rather, the market reception makes it appear as though the fragmented field has been only waiting for Apple to come and conquer. The new phones do not necessarily offer, in individual departments, features that are superior to those offered by other noted competitors. Yet, the verdict seems to be that the phones would be winners as a total package.

The new iPhones, accompanied also by iWatch (where too competition has been ahead of Apple in time), indicate a case of sustainable success; success that is not necessarily dependent on any single traditional sustainability factor such as first mover advantage, competitive specifications, lower price, brand loyalty. Apple’s success is often linked to its core competencies, from design elegance to supply efficiency. It is also linked to its leadership and people; the personal imprint of the late founder-CEO Steve Jobs and the current CEO Tim Cook on one hand and the expertise of functional leaders and their teams on the other. The theory on the whole is that Apple’s success is one of core competencies. This blog post examines if the phenomenon at hand lends itself to a simple competency explanation, or indicates the need for a more robust explanation.   
Competence set
If products and services are the bridge between organizations and markets, competencies are the driving force for products and services to be successful. The triad of customer, product (or service) and the organization is an ecosystem by itself where the boundaries and functionalities of the three elements seem to be physically defined but practically are overlapped. The collection of competencies that exist in that ecosystem defines the entry barriers and mobility barriers relating to the ecosystem. For a firm to dominate such an ecosystem, the set of competencies must be relevant and honed. There are usually limits to which an existing ecosystem can be expanded to integrate new products and services. There are also limits to which existing competencies can be honed and kept relevant. The theory of core competence needs to be revised as the theory of competence based delivery.
Structured competence set is very specific to the strategic direction. Apple has earned envy for the elegance of its product design, capabilities of its hardware and software, and for the unique formatting of its retail stores. Yet, Apple has been on a hiring spree over the last two years, bringing in some top-notch talent from related and unrelated fields. Tim Cook, the current CEO, himself has an addition for supply chain efficiency under Jobs. Angela Ahrendts, CEO of Burberry brings retail and marketing experience of a different kind to Apple. Paul Deneve, CEO of Yves Saint Laurent brings the experience of fashion and luxury goods. So does, celebrity designer, Mark Newson In terms of multi-product internal and external design elegance. Yet, it is not only a new found passion for fashion that dominates Apple’s competency diversification. Kevin Lynch, the CTO of Adobe and Ari Partinen, Nokia’s PureView technology camera guru have been inducted to add technology power to Apple.
Translation loss
It is one thing to bring together a set of competencies with an eye on the future, and even realize them as specific product or service attributes but it is entirely another thing to realize sustainable profits from such products and services. Sony, the electronics giant, was determined to assert itself in the smart phones business. It brought in ownership alignment by buying out Ericsson’s stake in the joint venture. Thereafter, Sony has evolved an exciting new design philosophy with its Z series smart phones and T series phablets. It has its famed camera technology with some of its highest mega pixel count. It brought in its Bravia and Triliminus display technologies. It also brought the industry pioneering dust and water-proof construction to its smart phones. It increased the renewal frequency of flagship models to twice a year compared to the annual frequency of Apple, Samsung and LG. It priced its products cheaper than competition while not pulling any stops in advertising. Like Samsung, it became a full range product provider, each with superior features.   
All this has been to no avail. At a time when Apple continues its smart phone dominance even with limited products and late stage diversification Sony has admitted to huge losses in its well updated and widely diversified smart phone business. Clearly, the whole of Sony’s formidable competencies has been lower than the sum of its parts. High competencies can create outstanding products and services but they may encounter either fusion inertia or translation loss as the firm aspires for commercial success. This is by no means confined to electronics. IT majors that set up consultancy verticals with highly competent business professionals have found it difficult to drive into such new businesses. FMCG companies which diversified into water purification products failed to compete with the established water purification giants such as Kent and Aquaguard despite the formidable brand power and retail network reach that the FMCG companies have. More than an assembly of competencies, alchemy of competencies could be a sustainability driver.
Alchemy versus assembly
In the physical world of management, assembly of competences is just an assembly of functions, with divergences reduced and alignments enhanced by cross-functional collaboration. To achieve sustainable success with industry pioneering or industry dominating features, organizations require alchemy of competencies. Alchemy, in a medieval sense, related to a form of chemistry pursued in the middle ages which tried to discover methods to change ordinary metals into gold. In a more modern sense, however, alchemy reflects a mysterious power that can change things or provide exceptional longevity. Addition of new people competencies certainly helps firms develop new products and services. Without hiring of Sumatran and Pawan, with their experiences of international automotive development, Tata Motors and Mahindra & Mahindra would not have been able to diversify into passenger cars and utility vehicles as they had been able to. That said, such successes have not been sustainable and repetitive leading to a question as to whether more than assembly of competencies is involved in sustainable success.
The concept of alchemy becomes relevant in the perspective. One hears of teams that tick; like the Indian cricket teams that won laurels in the World Cups, from 1983 onwards. One also hears of dream teams that deliver beyond expectations; many Hollywood blockbusters are shaped by dream teams. Such teams are shaped by alchemy. Alchemy in an organizational sense is neither mysterious or mystique; it represents complete emotional and professional bonding between members that ensures an ecosystem of creative ideas, open conversations, considered discussions and aligned executions. Teams empowered by alchemy continuously examine how the existing competencies are reinforced by the new competencies and vice versa. Alchemy is about everyone, and not the just new ones. It is not about one’s capability alone but everyone’s mutually fortified. As the examples of induction of new capabilities and the development of dream teams demonstrate, alchemy needs more than just those two elements.
Principles of alchemy
The challenge, therefore, is retaining alchemy in organizations as an all time phenomenon, irrespective of who comes and leaves. This blog post suggests a few principles of organizational alchemy. The first is organizational refresh. Staid organizations can produce only average solutions. By addition of new talent or upgrading of existing talent, organizations must refresh themselves constantly. The second is continuous collaboration. Typically organizations focus on collaboration based on projects. The more complex and more cross-functional or cross-border a project the more is the exhortation for collaboration. In organizational alchemy, collaboration has to be perpetual. It is neither issue based nor project based; it is a way of life. The fourth is technological flair. Alchemist organizations have the ability to create technological solutions to human problems; generating a satisfaction of pushing the horizon. Everyone in the organization understands technology even though only the defined ones may practice it.
The fourth principle is to look beyond the ordinary. The miraculous power to transform gets harnessed only when extraordinary goals are set. Alchemist organizations believe in growth as a way of life.  The final principle, that also enables the prior principles, is organizational chemistry. Personal chemistry works usually bilaterally or at best in limited teams. Organizational chemistry wherein every member of the organization is emotionally and professionally bonded is the essential element of alchemy. As Apple embarks on a new journey transforming Apple as a life companion with a slew of new products such as watches, wearable computers and health devices to supplement its smart phones, tablets, laptops and desktops, and as it inducts new talent from related and unrelated fields, the watch will be on if Apple would be the one company that moves from assembly of competencies to alchemy of competencies. Apple would be an interesting iWatch for students of management and leadership in times to come.
Posted by Dr CB Rao on September 21, 2014        

Saturday, September 13, 2014

From Unrest to REST (Recruitment Engine and Skill Transmission): An Automotive Inspiration to Human Resources Drive Train

Contemporary organizations are in a state of continuous unrest. Competitive conditions are no longer the only pressure for survival or superiority. Disruptive conditions make even the most recent strategic scripts obsolete. Governments and regulators assume an increasingly activist role in support of their constituencies or in pursuit of their mandates. When Chinese manufacturers offer smartphones, telecommunication gear, bulk drugs, power plants and bullet trains at amazingly lower costs relative to suppliers in the developed and developing world, competitive conditions turn into disruptive conditions for such vendors. Within India, low entry barriers and fragmented industries have been disruptive to orderly development and growth. Organizations, therefore, are in a state of perpetual unrest as they retool their available skills and retool with new skills. That, however, is hardly the answer because the changed competitive conditions tend to become real and ravaging well ahead of anticipated occurrences, and worse still in a completely unanticipated manner. Neither subdued organizational fatalism nor excited organizational unrest is hardly the answer to meet such surprises. ‘Anytime organizational readiness’ as a concept requires the adoption of REST model as it is the only way for organizations to be in a state of perpetual readiness.   

Automotive analogy
It is well known that the drive train that comprises the engine and transmission is the key enabler of automotive efficiency. The nature of the engine, whether it is gasoline or diesel, and the type of the transmission, whether it is manual or automatic, together determine the onroad power, torque, performance and economy of the automobile. The matching of the engine and transmission as an integrated system of drive train on one hand and the matching of the drive train to the driving conditions on the other are essential for optimal performance of an automobile in different countries. The automotive designers, therefore, commit considerable innovation and effort to optimize the drive train to internal and external conditions. While there exist several other design factors that impact automotive performance such as the profile and weight of the automobile, for a given set of non-drive train factors, it is the efficiency and economy of the drive train that determines the internal and external performance efficiency and driving compatibility of an automobile.
This blog post proposes that two essential components of the human resources function in an organization, namely recruitment engine and skill transmission constitute the drive train of an organization and impact the overall performance of an organization in the competitive traffic of business competition. As with organizational design there exist several other factors of organization design that impact organizational performance. These are, for example, the profile and size of the organization (akin to the profile and size of an automobile). Be that as may, the way the recruitment engine and skill transmission in an organization are designed and tuned determines organizational performance, other factors remaining constant. This blog post proposes an optimized model of Recruitment Engine and Skill Development, with the acronym of REST that can provide a meaningful conceptual and analytical framework for driving human resources efficiency and effectiveness in an organization. The drive train needs to be continuously optimized as driving conditions and preferences evolve; so does the organizational drive train need to be continuously optimized as business conditions and strategies evolve.
Recruitment engine
The automotive engine is characterized by three fundamental characteristics, the power, torque and specific fuel consumption (SFC). The power curve provides the ability to accelerate the automobile and carry the load while the torque curve provides the ability to start the vehicle with loads and in upward gradients and the SFC curve reflects the ability to run economically at different power and torque levels. The recruitment engine in an organization provides a similar function set; an ability to take the business challenges against adversity (the torque), an ability to cruise competitively on the business pathway ahead of others (the power) and an ability to use resources judiciously and economically while meeting the other two traction needs (the fuel economy).  Just as these three characteristics are integral and integrated part of an engine design (despite being three separate performance curves), the three characteristics of resilience, competitiveness and economy must be the integrated and integral part of recruitment engine design and delivery.
Different engines are designed for different purposes in classic automotive design. Similarly, different recruitment engines are required for different business purposes. Startup phase requires high resilience of the human resource base (high torque talent). The growth phase requires an ability to accelerate and stay ahead (high power talent). The maturity phase requires the skill to be cost competitive and achieve long term sustenance (high economy talent). Firms that desire to stay in the game as long as possible in the maturity phase or extend the product life cycle through a fresh startup and growth phase require all the three characteristics in varying measures. Just as a unitary engine design is today being re-tuned to meet different characteristics (for example, Tata Revatron engine which is controlled by microprocessor technology to meet three different driving needs of city, sport and economy), the organizational recruitment engine must also be capable being one in constitution but multiple in recruitment characteristics. This requires extreme sensitivity (akin to microprocessors) on the part of the recruitment engine to varying internal and external needs.  
Skill transmission
The automotive gear box plays an extremely important role in enabling the basic performance of the engine to be matched and amplified based on the driving gradients. The gearbox technology has moved from manual four speed gearboxes to automatic and continuously variable transmissions capable of matching the engine performance to road requirements at different engine speeds. In organizational settings too systems of skill transmission can play a great role in ensuring that the available skills brought in by the recruitment engine are amplified and conditioned to meet unanticipated and challenging business requirements. One is habituated to expect skill transformation to accomplish such arduous transportation on business highway to future. Skill transmission, however, is an altogether different concept. It is the ability of the team managers and corporate leaders ensure that the available skills are matched or enhanced to levels that are required. Managers and leaders are habituated to assume themselves to be the steering wheels of an automobile in a classic automobile analogy but they actually need to play a less visible and more appropriate role of a transmission that is consistent with their accumulated knowledge, experience and intuition.
Managers would need move from coordinating and controlling roles to progressive roles that excel in imparting their skills to reshape or augment their team members’ skills and, in some cases, let their own skills work directly with their team members’. Leaders would need to transform themselves from oversight and judgmental roles to judging business gradients and competitive conditions. Over time, the behaviors of managers and leaders tend to be predictable, from their periodic exhortations to quarterly expectations. Over time, in organizations,  innovation and creativity of executives tend to be subservient to the directions and boundaries set by the managers and leaders. As the competitive intensity increases managers and leaders become skill demanders rather than skill enhancers. Their expectations lie around transformation of the skills of their team members (which is a required long term fix) rather than devising ways by which available skills can be redeployed to maximal efficacy. Managers and leaders need to recognize that they are an integrated part of the human resources drive train and the converter between the raw power, torque and economy of their teams and the rough conditions of their businesses.
From unrest to REST
Organizations cannot afford to ever rest in the task of organization building and talent development. New entrants must see their entry as only the first step to develop skills that are industry-specific and application oriented. Managers and leaders cannot afford to consider the journey of competitiveness as a steady state cruise. Disruption, whether by competition, regulation or globalization, is the order of the day. If unrest in organizational performance and infrastructure is a way of life, REST as a model of organizational competencies is the elixir of organizational life. Recruitment engine in a growth oriented high performance organization never gets switched off; it remains in perpetual throttle to balance the skills at a basal level and rev up as required. Skill transmission enjoins the leadership to be in a continuously variable application mode to deliver maximum value by combining the executive, managerial and leadership skills that are already resident in the organization.
Like the best automotive drive train that remains invisible under the hood but purrs to perfect performance, REST, the human drive train, is the invisible force that remains in perpetual throttle with an automatic transmission of combined human capabilities of the organization to meet variable business requirements. This, however, requires a major shift in the mindset of managers and leaders (and organizational expectations) from visible direction-setting and judgmental oversight to invisible skill amplification and augmentation of their teams and organizations. This also requires a shift in the mindset of team and organizational members (and manager, leader expectations) from compliant direction taking and performance excellence to active knowledge seeking and competitive collaboration with their managers and leaders.   
Posted by Dr CB Rao on September 21, 2014  



Sunday, September 7, 2014

Smart Cities With Smart Villages: Need for 'Capital' Paradigms for People Development

The announcement of the 100 Smart Cities concept is one of the visionary moves of the new NDA Government in India. While there is no definition of a smart city (articulated more to support increased urbanization), one may assume that a typical smart city would have high level social and industrial infrastructure with a robust digital backbone. A smart city may have metro rail and highway connectivity with international airports to boot. It would have certain pre-existing core industrial and commercial activity that can be leveraged for expansion and diversification. It is not, therefore, surprising that Tier 2 and 3 cities like Visakhapatnam, Madurai, Kurnool, Nagpur and Cuttack, to quote a few examples, would be qualifying as smart cities. 

Clearly, development of smart cities requires not only a more precise definition of the concept but also a more clear pathway for execution. It is for this reason that the Union Budget envisages‎ an allocation of Rs 7600 crores in the Union Budget 2014-15 to develop a clearer grasp over the concept and make a start. With only 6 months to go before the next budget, it looks as if the States are yet to make specific smart city strategies.  It is hoped that the development planning exercise will be specific to each city selected as a qualifying city (rather than as a generic concept for all the cities). Specific studies will recognize the peculiar needs of each city in terms of geo-economic and demographic profiles and develop plans that would be ready to execute. This blog post suggests a few ways to lead the smart city concept to execution but more importantly touches upon the need to develop a smart village concept as well.
Smart villages
It is well-known that nearly 70 percent of India's population still lives in India's 600,000 villages. There can, therefore, be no equitable development unless the villages are also brought into the smart paradigm. If 100 smart cities are seen as the magnets to spur overall urban development, probably the country would need about 20,000 smart villages in the first phase. Smartness is the ability to be contextually efficient and effective. Given that villages are dependent on natural resources for day to day living smart villages must aim at leveraging technology for more efficient and effective use of technologies and generating surpluses that can be sold in the urban centres to generate rural wealth.

The smart villages must aim at being the nodal hubs for the balance ‎580,000 villages. While each of the 600,000 villages must be covered by total sanitation, drinking water and housing for every family, the smart villages must have certain additional capabilities. Typically, each smart village must be strategically selected to support a cluster of villages in an accessible distance; it should be the centre of a cluster of villages in a 5 kilometre radius. It should have a 3 tier school structure to support universal education, a multi-utility agricultural resource complex to support smart agriculture and a healthcare infrastructure to provide life support systems. The agricultural resource centre would be the core of a smart village. 

Smart agriculture 

India has fairly long monsoon season, extending between 4 and 5 months in different regions. What is unpredictable, however, are the start and end ‎dates as well as the curves of ramp-up extension and ramp-down withdrawal, impacting the seeding, sowing and reaping phases. In addition, unseasonal rains and floods caused by the low pressure areas in the long coast line cause damage to standing crops and produce. As all the villages are solely and wholly dependent on agriculture, the smart villages must emerge as the protective umbrella for the larger village clusters as agricultural resource centres. In addition, they must lead a smart agriculture revolution across the villages.

Each smart village must have ‎a multi-utility Agriculture Resource Complex (ARC) comprising a meteorological centre, fertiliser centre, a pesticide centre,‎ a seeds centre, a threshing centre, a drying centre, a testing centre, a grain warehouse, a crop planning centre, a logistics centre, a leasing centre (for tractors, trailers, vehicles and implements), a grameen bank, a telecommunications centre, and  a crisis management centre. The ARC in each smart village would be the key to develop and implement smart agriculture strategies in the villages covered by each smart village. All the ARCs would be digitally connected not only among themselves but with leading agricultural universities.

Smart industry

Just as smart agriculture is the core to wealth generation for sustainable rural development (all towns and cities), smart industry is the core to wealth generation to sustainable urban development. The development of smart cities must be accompanied by a smart industry strategy as well. Smart industry policy must incorporate strategies to develop custom-built industrial parks that can can cater to the entire value chain of each industry. Typically, the parks should have equal share reserved for end-products and component makers. Even if a component supplier is centrally located and well-established elsewhere there is no reason why a finishing operation cannot be decentralized locally. Bharat Forge may produce and rough machine all of its forgings for India in Pune but can set up the fine machining facilities wherever major automobile firms are. 

Smart industry policy also involves creation of the entire comm‎ercial and governmental infrastructure that is required to serve the industrial park through single window clearances and commercialisation. Smart industry policy should aim at crating product-specific logistics and transportation hubs and parking terminals (for both cargo and people) and container terminals for mulltimodal transportation (of incoming and outgoing goods). Most parks are developed only for bare factory requirements and not for the whole series of support centres and hubs that are mentioned herein. New industrial parks in smart cities should, therefore, be conceptualised with foresight and industry collaboration.

Smart residence 
As much as industry is important, civic life is equally important. Indian residential market has been progressively moving out of the reach of the lower and ‎middle income groups, essentially due to escalation of land prices and construction costs. The efforts by the governments to develop low income houses in far flung areas has increased the distance between the workplace and homespace for vast tracts of workforce. The affordable homes conceived by certain reputed builders, such as Mahindra and Tata, are too few and isolated to make an impact. As the Governments set about building smart cities and smart villages it is time to do away with the concepts of economic isolation that have taken root over the years. 

Indian cities as they historically evolved had little planning for integrated residential habitats. From Mumbai to New Delhi and from Chandigarh to New Raipur, one can see multiple models, none of them fully thought through for a sustainable high quality living with socio-economic integration. Alternative models do exist; the campus of the ‎Indian Institute of Technology Madras is a good example of harmonious housing colonies with multiple templates co-existing.  As the smart cities get built, integrated planning of residential and commercial spaces would be required. There is no reason for abandoning the weaker sections to isolated existence and tardy development in the fringes. On the other hand, there is every need to use the smart city and smart village as well as new capital developments to integrate all sections of the population, socially and economically.

Renewing the core
An important component of developing the smart cities and villages is the renewal of the core. Any observation of historical development indicates that civilisations deve‎loped on river banks, sea coasts or hill valleys for good socio-economic reasons. While developing smart cities and villages, efforts must be made to renew the core to retain traditional advantages while injecting contemporary land use planning. Just as land pooling is being planned for construction of a new capital in the Vijayawada region, building pooling can be considered for renewal of old urban centres. This must focus on unplanned, impoverished, dilapidated and bottleneck parts of the urban centres to convert them into more vibrant zones which can meet the needs of the coming decades. 

An aerial view of any of the cities identified as smart cities would reveal congested building clusters which are not only partially constructed but are also unsafe. Yet they constitute valuable property and the only means of security to the owners. A major people's initiative would be required to achieve productive renewal of the core. It is likely that a well conceived and apolitical plan in public-private participation would help achieve the objectives. The renewal can be an opportunity to create large horizontal free spaces for movement and parking while going vertical for creating commercial and residential space. In the urban renewal, care needs to be taken to avoid wall to wall packing of buildings, a legacy or temptation to which even the world's greatest cities have succumbed.
Waves and ripples

Along with the identification and renewal of a core, new zones must be created for expansion of smart city areas from the available basic stages. There are two ways the development can be effected; one as waves and the other as ripples. A wave form of development starts from a developed core and moves towards an unexplored horizon. The development of Hyderabad which proceeded from the core Ameerpet are‎a to Banjara Hills, Jubilee Hills, Hitex City and now Gachi Bowli is an example of wave development. The advantage of wave development is that the existing connectivity options can be progressively extended while new enclaves get developed. The disadvantage of wave development is that the constraints of a previous development tend to impact the newer developments as the core is what provides the basic development backbone.

The ripple  development is based on choosing new nodes far away from the core, and developing them towards one another‎. The development of Bengaluru with new distant clusters like Sarjapur, Whitefield, Peenya and Davanahalli serving as the four new clusters expanding and rippling outwards from each of the new cores is an example. The advantage of ripple development is that it enables a much larger canvas and a much faster pace of development. The disadvantage is that it tends to be a connectivity nightmare if people need to commute across work areas of one location and residential areas of another location. Bengaluru is an example of both. As the governments embark upon converting the existing cities into smart cities, the need for orderliness and convenience cannot be ignored.

Managing expectations

It appears that development of smart cities and smart villages could be at high land costs. The (already costly) experience with the new capital of AP suggests the need for tempered visions and calibrated communications. Farmers who have inherited the lands in and around Vijayawada, and have been living in abject poverty thus far should feel happy with the smart developments that fetch huge land values. On the other hand, if they have already sold their land parcels months earlier for small incremental appreciation to 'smart' people, then they may have unknowingly skirted the once in a lifetime development opportunity. Media reports suggest that this indeed could be the emerging story. Reports suggest unprecedented spikes in the land prices in and around Vijayawada, expected as the new capital city of Andhra Pradesh ever since the bifurcation of the AP State a few months ago (and announced accordingly on September 4, 2014 in the AP Legislative Assembly).

Other reports suggest that the Governments would go in for joint development for the new capital with land pooling with 40 percent share to the land owners and the skyscrapers getting built free on the land on the basis that half the number of floors would go to the Government with the balance half being retained by the developers for their sale. This has a hidden high cost element while being low on visible expenditure. The other alternative, possibly less speculative and more cost-effective, is to limit new capital development to only clusters that have government land and avoid private acquisition of land. Even if such clusters are separated, top class road and metro rail connectivity can be ensured to keep them networked. This could be a better model with each cluster focusing on one specific part of governance. 

Digital connectivity
An avowed objective of the NDA government is digital integration. Smart cities as well as smart villages must lead in this. Digital connectivity is more than wifi enablement or iPad deployment. An ability to access information through a private device in any public spot is only a battle half won. Digital connectivity must provide access to information for all people at all places without having to resort to private devices.‎ Announcing arrival and departure times through mobile applications may be an improvement over telephonic enquiry service but does not represent real and total digital connectivity. Digital connectivity needs time to speak and time to listen. The new Government has asked for people's  suggestions on the body to replace the Planning Commission. However, only few suggestions have flown digitally while fewer have been analyzed. When digital universe is opened up, time needs to be allotted to make use of the information highways by all stakeholders. 

Digital connectivity must facilitate instantaneous access to desired information by public. ‎This is enabled largely by major upgrades in digitization of all activities starting from one digital card for each individual to total digitization of all transactions. The Income Tax department has demonstrated how several economic transactions can be interlinked with one PAN card number. The experience can be more profound if, for example, the labour market and employment market are fully digitised with access of real time information on vacancies and candidates. A national information exchange could be a national repository of public information with a dedicated search engine. Even in today's times, ministers cannot be reached by general public. In a true digitised state, digital outreach (as organized for the Prime Minister on the Teachers' Day) would be a daily feasibility. There should be digital highways that carry the citizens' pains and pleasures to the administrators and ministers anytime. 

Smart India Authority 

The plans that are being laid out are so great with development aspirations all across India and with investment needs so huge that the development paradigms need to be created carefully. Centre could enable a centralised model based on central and global institutional funding or allow the States pursue their own models of smart development. Whichever route is taken, the development paradigms must be empathetic to the needs of the poor and downtrodden as the smart city and village concepts are the one last chance to bring people onto the developmental mainstream. Whether a new body to replace the Planning Commission takes shape or not, a new Smart India Authority seems to be definitely required so that the smart visions and raised expectations are aligned with empathetic strategies and ‎invigorated execution.

Posted by Dr CB Rao on September 8, 2014