Tuesday, November 20, 2012

SUSHIL MODI: VOTE OF CONFIDENCE

Deputy CM Sushil Modi wins a reprieve, albeit temporary, in Bihar

The number of those wanting to get ministerial berths far outstripped the portfolios that were on offer. BJP legislators say that Modi is too much of a Nitish Kumar man and has ignored the interests of the party. Prime BJP dissident and legislator, Satyadev Narayan Rai, told B&E: “Sushil Modi is not a mass leader. He does not understand the party at its grassroots. He does not take the party along in any decision. Most decisions of his are unilateral.” Political observers say that Modi was saved due to a combination of reasons, which includes the compulsions of coalition politics and Modi’s closeness to party supremo, L. K. Advani. The critical question here is: how long will he survive? Not for long, because standing against him are perennial BJP dissidents, Murli Manohar Joshi and Kalraj Mishra, both from neighbouring UP, who have an active interest in keeping the pot boiling. It is equally certain that those opposed to Modi have only lost a temporary battle. The war in the Bihar BJP could have just begun.


Source : IIPM Editorial, 2012.

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AMAR SINGH: CONGRESS-SP

 Left is peeved with Amar Singh for taking SP closer to Congress

Reflecting the current frostiness between the two is Amar Singh, who has stated two things clearly. One, the Bill in its present form is unacceptable. Two, he has charged the Left with changing policies to suit its convenience.

Left leaders have also not taken too kindly to recent Congress invitations for SP leaders to attend celebrations linked to UPA government’s four years in office. Interestingly, this is the first time in four years that SP leaders were invited to any UPA function. With General Elections due next year, it would appear that the Congress has no choice but to entertain both SP and the Left. The imperatives of real politics make it incumbent upon the Congress to keep the option of a possible alliance with SP open. Especially when SP appears to be getting bigger after the UP unit of the Janata Dal (Secular) decided to merge with it recently.

If the current impasse between the two continues after the General Elections, there is little doubt that the concept of a Third Front would be delivered a body blow. Something that the Left is not going to be too amused by.


Source : IIPM Editorial, 2012.

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Sunday, November 18, 2012

Why Saxons hate Porsche!

Piëch would find the Saxon barrier quite unfathomable

As Stuttgart-based Porsche fires all cylinders to gain majority control over Volkswagen (VW) AG, Chairman Ferdinand Piëch of VW finds himself in a funny situation. Being the grandson of Ferdinand Porsche, the legendary designer of the Beatle and the founder of sports car major Porsche, he surely has his emotional reasons to try and allow Porsche to take controlling stake of VW, Europe’s largest auto group that owns nine separate brands – including Audi, Bentley and the likes – and made close to $1.5 billion in sales during the first quarter this year.

Porsche already owns a 31% stake in Volkswagen and wants to have a majority stake in VW in order to have access to its liquidity and to secure an uninterrupted supply of parts. Also, as per Christian Breitsprecher of Sal Oppenheim comments to B&E, “Porsche is interested in Volkswagen because it wants to have access to the latter’s scales and volumes.” But isn’t 31% enough to take over control?


Source : IIPM Editorial, 2012.

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Wednesday, November 14, 2012

Enter Gilani

Nothing could please the country's friends more

Pakistan is rejoicing about something that can worry only the mullahs or Uncle Sam’s trusted nominee: the President-by-proxy Pervez Musharraf. The general-in-civvies who would be the country’s permanent CEO. Yes, the country where the military has traditionally been regarded as “the largest and most powerful party” finally has a leader whose immediate goal is to push the soldiers back to the barracks – and to make sure they stay there!

Happily, Prime Minister Yousuf Raza Gilani has also pledged to restore the judges whom Musharraf ousted, because they would not consent to recognise his illegal presidency. Asif Ali Zardari, the slain Benazir Bhutto’s widower, himself had been far less clear on the ticklish subject of what should be done with Musharraf. Indeed it would have come as no surprise had even Benazir, having benefited from the power-sharing deal with the canny Musharraf, been eventually compelled into ‘General Retreat’!


Source : IIPM Editorial, 2012.

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Saturday, November 10, 2012

PFIZER & MERCK: CEO MIRROR

As lawyer Kindler loses court battles, army man Clark strengthens his defences with a flanking strategy

Instead, Kindler is showing more interest in drugs, which are still in the mid-stage trial process and do not have the capability to replace Lipitor. According to a report by Morgan Stanley Research North America, Kindler’s decision to not enter into any mega deal following the disruption and negative impact to R&D productivity due to the last two acquisitions is encouraging. But in doing so, Kindler has also dismissed another alternative to increase Pfizer’s product pipeline. Interestingly, as Kindler was announcing these plans on March 5, 2008, stock prices of Pfizer fell at a 52-week low on the same day, hitting a low of $21.80.

If one had to rate the performance of the two CEOs, it was apparent from their compensations in 2007. Where on one hand Clark got compensation valued at $14.7 million in 2007, Kindler was just a little behind and received compensation worth $12.6 million the same year, but considering the fact that both marked an increase of 10% and 80% respectively from 2006 summarises their performance. Most of Clark’s compensation came from the value of stock and options granted to him in 2007, out of which $8.23 million was by virtue of three grants made in 2007, according to the proxy filing with the SEC. As for Kindler, his bonus, too, was reduced to $3.1 million, from $3.3 million in 2006.

The dissimilarity between the two CEOs is also evident in the reaction of the stock market towards their performance. While Pfizer’s stock price was languishing at $20.57 on March 17, 2008 (a drop of 21.2% since Kindler assumed office), Merck’s stock price was at a robust $41.85 as on the same date, which represented a rise of about 21.3% since Clark took over the baton.

So, well… while the legal beagle is finding himself helpless against Pfizer’s expiring patents and increasing competition from low-cost generic drugs, the army man has proved to be more than his weight in gold for Merck, with his visionary capabilities and swift, effective decision making abilities. For crisis-ridden pharma companies, there are definitely a few points to take home.


Source : IIPM Editorial, 2012.

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Thursday, November 8, 2012

In comes Stanford John...

Donahoe has his own ideas to take Whitman’s legacy to the next level

Very rarely does one come across leaders, who not only dramatically transform fortunes of companies, but most interestingly, come on board with a pre-decided tenure! One such leader who beautifully joins the league is the sterling 52-year-old CEO of eBay Inc. – Margaret C. Whitman. When she took on the scepter of CEO in 1998, she made it very clear that a decade is a fairly good time for a CEO at the helm of a company. And her resignation comes precisely after ten years on March 1, 2008. “It’s important that new perspectives & new eyes come to the company. It’s tough to stay fresh, no matter who you are,” admitted Whitman on January 24. She will be replaced by John Donahoe, currently President of eBay Marketplaces, effective March 31, 2008. Ironically, the contrast between the two perhaps could not have been more striking, far beyond the Harvard-Stanford face-off (Meg is a Harvard alumnus & John is a Stanford graduate).

While Whitman has almost always tackled corporate growth issues using macro-strategies, John – who was the worldwide MD of Bain and Co. for five years before joining eBay in 2005 – has more or less focused on micro-process issues. Consider this. When, in 1998, eBay suffered debilitatingly due to lack of funding, Whitman initiated a massive IPO to fund its expansion plans. Her acquisition of online payment service PayPal in 2002 for $1.5 billion gave a much required boost to eBay, & consolidated its stranglehold in online auction business. In 1998, the 30-employee-strong eBay had a meagre 5,00,000 registered users. Today it has a mind numbing 83.2 million active users & $7.7 billion in revenue. With 15,000 employees & growing, it is the world’s largest e-commerce site.


Source : IIPM Editorial, 2012.

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IIPM : The B-School with a Human Face
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L. K. Advani’s dumbing down

BJP’s strongman opts for a face-lift to achieve his ultimate political dream of being India’s PM

The BJP’s parliamentary board, which ratified L.K.Advani’s candidature as the Prime Minister in waiting, is in the throes of another ticklish query: while the party, allies and cadres accept Advani as their supreme leader, will the country, and more specifically Muslims, do the same when the time comes? Therefore, members of the parliamentary board have asked the state BJP chiefs to carry out an internal survey in various states for the consumption of their cadres and other party leaders. The question they have to address: what can be done to reform Advani’s hardline image and steps that need to be taken to improve and liberalise his image.

This operation is to be headed by BJP vice president, Mokhtar Abbas Naqvi. His brief: to find out why Advani, who has a hardline Hindutva image, has been unable to make an impact on the common mass of public in the same way as Sonia Gandhi or Atal Behari Vajpayee. The question rankling the BJP top brass is despite conducting five rath yatras between 1990 and 1997, Advani is not quite considered a man of the masses. At several meetings of the parliamentary board, office bearers have told state chiefs that Advani’s name and public programme, if any in the state, should be given wide publicity. His pronouncements and statements needed to be played up and his entire programmes need to be highlighted well.

But like most leaders who have aspired to lead India, Advani is very keen to undergo an image change, from being a leading Hindutva factionalist to a moderate leader with middle-of-the road views and wide acceptability. The man chosen to conduct this face change is Naqvi, a Shia, who BJP leaders say has acceptability amongst Muslims.


Source : IIPM Editorial, 2012.

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IIPM : The B-School with a Human Face
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