100 ml tel aur thodi si sharab

Children in this distant village in Odisha manage to open their books even after sunset. Most kids in cities do so, for one reason- complete some ‘homework’. They are able to do so because their is abundant light, of a CFL or regular tubelights/bulbs. The children i came across in this village neither had homework to finish nor any light that they could make use of. So, it is all the more surprising that they sit down and read and solve math problems at night.

The children have been attending pre/post school classes that help them to bridge learning deficits that are common at their age. The classes have also filled a void, rather a thirst, of knowing more, comprehending the world and doing things they have never done before. Perhaps that is the reason these kids attend the ‘extra’ class, then go to their school and get back to books once the day says good night.

Reading books at night wasn’t really possible for them, till some months back. Now the villagers manage to light a few lamps and help their children spend some quality time with books. These lamps are not lit by oil alone, it is the ability of women and men to believe ‘that there is something  in them superior to their circumstances’. Some village women started a donation drive where 100 millilitre kerosene was collected form each house and the contributions have not been an one-ff event. They also realized that such small contributions can make a significant difference for each child and the next target was liquor. The logic was simple- if the village men can give up liquor, even for2-3 days in a week, they can save sizeable amount of money that can be routed to lamps and more oil.

A teacher and his mobile

This conversation took inside one of the three rooms of this school. Located far away from anything, the school at Sookha Semli was almost like an oasis in a desert. Within an area of 2-3 kms we could only see bushes and trees and motorcycle tracks. The headmaster, while answering my questions on how often he has to visit the block office, said ‘block me soochna dene ke liye motorcyle leke 12-15 km duur jana padta hai. Main us din school nahi aa pata. Pura din nikal jata hai kaam me. (I have to travel 12-15 kms to submit information/data to the block office. I am not able to attend the school on such days).’

Having said this he took out his mobile ph0ne and showed it to me. He found it hard to believe why this instrument could not be used for sharing data and information between teachers and block offices. Every teacher in India doubles up as data collectors for the education system. Sometimes the same data is collected more than once and reported to different authorities. Multiplicity of data also means more  work for teachers who spend considerable time in collating and communicating this data. And data is not data alone, it brings with it considerable stress to meet deadlines and the fear of rebuke and criticism.

Coming back to the teacher’s question- can we use a mobile phone to submit data to a common repository which can be accessed by different departments in the government as per their needs? There are issues here-

  • Only certain kinds of data are amenable to this medium- numeric data or very short status updates
  • How to prevent data theft? One way could be to give every teacher a password which he/she can prefix to the data message
  • Schools could be recognized by their individual codes, which too is suffixed to the data
  • The syntax of the data message could be shared with schools and teachers in advance

There is a lot more that a mobile phone can do- used for opinion/information sharing; for teacher professional development; for accountability etc. More on it later.

Who rules the world???

The world is constituted of around 7 billion people, their activities and the environment around them. They all belong to different traditions, different cultures and different affiliations. We can not assume that each one of us think on the same line, be equally motivated, and be self-ruled and self-governed. Few people are entrusted to facilitate the affairs of the world be it government or business affairs.
These individuals get their legitimacy to take decisions on behalf of the greater number of people on the basis on set procedures and rules. This body of rules and procedures is called an institution. Various institution mechanism give them powers to take decisions, to act on them and to be accountable for them. Degree of accountability might vary based on the soundness of the institutional mechanism put up. It is also possible that the leader can dominate the decision making but this discretion can be curtailed by way of putting better mechanisms. For example, the president of USA can be powerful and dominant persona but he can not act on his whims and fancies without the approval of senate. And senate is also accountable to people as well as liable for judicial review by the Federal court.
Also, we see that even absolute dictators and military rulers try to get the power and legitimacy through putting up institutional mechanism. Be it National Defence Council led by Kim Jong-il of North Korea or be it General Pervez Mushraf of Pakistan.
In business organizations also, CEO or the chairman is accountable to the body of directors. And in turn get legitimacy from the shareholders. They are also accountable to the government regulations and rule of Law.
Building institution is a continuous process and it keeps on improving based on the feedback and experiences. Like, after global financial meltdown USA has passed Financial Liability Act f 2009 which ensures better regulation and credit rating of financial institution. Now, when it is regulated by a statute, no individual can influence discriminately.
So we can fairly conclude from above arguments that though few individuals are dominating the decision making in the world today, we can curb their discretion through putting up better and stronger institutional mechanisms.

Schools Schools everywhere, which one to choose?

The title of this post is almost an irony for most parents. Going by present times, it should have been- How a school chooses you? Nonetheless i decided to write this because i continue to feel, strongly as days pass, that one of the best investments anyone can make is picking a school for their child. There is a reason i call it investment. Most of us spend awful lot of time and energy in deciding what to wear, where to eat, how to live, how to spend the annual holiday etc etc. A lot of parents also pay a fortune to get their children ‘good’ education. People do all of this, but my point is limited to this- a true investment is preceded by careful analysis and judgement, something that completely misses when (most) parents decide which school to send their children to. Here lies the meat of my argument. What i write henceforth in this post would mostly be focused on urban schooling.

Let us look at how decisions with regards to school education are made-

  • Hearsay
  • Ease of access (distance and/or connections)
  • Financial wherewithal
  • Ideological reasons
  • Random tries

No one ranks schools on the basis of the ‘goodness’ of education that is provided. No one looks at the school-ness of a school- does it even make sense to attend a school that is a display of architecture, more than anything else? In the absence of any sort of calibrated information parents end up convincing themselves of the decisions they make and follow it up with supplements for the child- tuition classes, hobby classes, summer camps etc etc. The hope stays the same- everything will fall in place in the end. Perhaps it does, perhaps schools work, whatever be the quality.

There is a lot that can be said about the kind of education that a child needs in our times but i will put that away for another day. I have always believed that education is an experience (a characteristic experience, as Prof. Krishna Kumar would say) and if a school is not able to give that to a child, then it is missing the game completely. There are certain things that each parent would want for his/her child- happiness, a joyful childhood, safety etc etc. everything that ensures to a jolly good adulthood. Some parents want more, some might want less but everyone has expectations from as a child grows and it is only fair if some of these expectations reflect in the choice of education and school.

All this sounds very good but are people really putting efforts in realizing their expectations? I would leave you to answer this question but before that i would like to share a small ‘to do’ list that might help you in deciding, or atleast in thinking how to decide.

  • The child’s education has already begun even before she awaits the Principal’s nod to enter a school. Her parents, her friends, her family has already started shaping her thoughts. So the first thing to do is to be alert of what you say, what you do and how you treat your child before packing her off in a school bus.
  • Do not enter a school with the ‘lets go and get you admitted’ mentality. Rushing through this process will have repercussions.
  • Start early by making a list of schools you would like to try out, based on whatever criteria you want. Keep your list broad, i.e. don’t be a stickler with regards to status of a school etc. include lot of schools.
  • Judge the value of a school by the fee it charges and you are bound to end a bankrupt- financially and emotionally.
  • Insist of classroom observations in the schools on your list, talk to the teachers, listen to the children, see them spend their spare time. If the Principal tells you that allowing parents in the classroom is against policy, you might as well leave the campus.
  • Visit a rural school whenever you get a chance, see what they are upto. Be the judge of what is it that teachers and children should value.
  • Feel the environment, the school should embrace the child.
  • Focus on the necessities- love, inclusiveness, camaraderie. Any form of discrimination should be on your zero tolerance list.

(I’ll keep adding to this list)

Last but not the least, be physically and emotionally involved in your child’s education.

Q & A: FMCG Distribution

Some important questions were raised from my previous post. I am attempting to respond to them based on my observation and experience.

How do you think the process will change in case of a new product and a new company? Especially with regards to the terms of engagement?

Based on the product, the industry and the territory the company is operating in, the distribution process changes. Though the basic role of the distributor remains same, there are differences at various levels. We can think of following different scenario which provides for various levels of engagement from the distributor:

Old company, old product

Both company and product are old and known to the market. It has already made its own space in the retail space, so it does not require routine attention and intervention of the distributor. Distributor can focus on developmental activities.

Old company, new product

When a new product is launched by the company which is already out there in the market, the approach is different. Distributor needs to make retailers aware about the new product, salesman needs to be trained, and infrastructure needs to be arranged. As company is already selling its other products, retailers are already known to the company, already identified. This requires less effort on the part of distributor.

New company, new product

This is higher level of problem as compared to previous two cases, as both company and its product are new in the market. The distributor needs to identify relevant retailers, introduce the company and then introduce the product. This requires much more effort and engagement from the distributor.

We can add third dimension to this based on the distributor is new in the distribution business or an old hand already distributing other FMCG products. Distributor can exploit his relationship with retailers for the new company and new product.

 How do you track the performance of the distributor?

Performance of the distributor can be measured on following criteria.

  • Sales growth on previous year base (compare with expected sales in case of new product)
  • Retail penetration- retail universe covered
  • If product range is there, distribution of sales across the range
  • No. of stock out instances
  • Complaints/feedback received from retailers
  • Qualitative observation of the company officer concerned

Some punitive points should also be added in the performance measurement. Punitive points in the sense, failing to adhere to those criteria will bring negative points to performance. Regularity of delivery, quality of delivered product, training & behavior of the salesman can be added to this list.

Is it a good thing if a particular distributor is given 3 products to sell and he sells one extremely well but he does poorly in the other two? Do you restrict the flow of the better selling one by attaching a condition that you have to sell amount X of the other two to get further supply of the better selling product? Or do you rearrange incentives?

It is not desirable if distributor sales one product and ignores other. That product will die in that territory. We need to create various mechanisms by which all products receive due attention from the distributor. It can be changes in the margin structure, changes in the incentive structure etc.

Distributor as businessman would always like to sell fast moving products first and ignore the slow moving one. He would like to maximize his commission putting minimum efforts.

We can take commitment for the lower selling product ensuring distributor that he will be given better selling product as demanded. It’s the responsibility of the local officer responsible to see that all products get due attention based on the potential.

How are the commissions decided? Do we have information about the common range of commissions for different FMCG products?

Commission for distributors is decided based on following.

  • Investment and operating expenses of the distributor
  • Expected rate of return on investment
  • Margin/commission offered by competitors on same/similar products
  • RoI in other similar businesses
  • Expected sales volume of the product (for example, slow moving products have higher margin)

Apart from normal commission, various incentives are also given to the distributor to make him focus on a particular product or pack, to counter competitor’s move etc.

The Education Puzzle

This is a Guest Post by Ashutosh Tosaria. Ashutosh spends his time solving the puzzles that the education sector is muddled with. In his spare time, he works with an organisation which supports initiatives which seek to strengthen the elementary education sector in India.

Every child in school, getting quality education. The simple statement packs in itself many questions and confusions, some of which I would try to highlight here.
Let’s look at the supply chain of schooling. As is true with supply chains elsewhere, school education also lends itself to a demand and supply side relationship. Between the demand and supply are a host of actors, institutions that provide education or support provision of education. All of this is governed by rules (both said and unsaid) and choices, which shape processes and the quality of the service on offer.
The demand for education comes from children and parents. Civil society too can be counted with these two but for the moment lets just focus on the real beneficiaries or rather the first tier benefeciaries- children and parents. Often, this demand is made amidst serious information asymmetry. How good a school is, what is it that my child is doing in the school, why is education important at all? These are some questions that help a parent decide if he/she wants to send the child to a school. Choice of school is slowly becoming a reality for parents in rural India, thanks to the spurt in low cost private schools that dot the landscape. On one hand we have the government schooling system which offers (almost) free education (there are certain costs incurred by parents) and on the other a private school that charges a fee and is mostly staffed with unqualified teachers. No doubt that the government school system is often found crumbling but the choice of a private school is made based on notions because kosher information is missing.
Now lets look at the supply side, which is dotted with autonomous, under funded private schools and reasonably well funded but non responsive government schools. The latter is situated in an byzantine education support system that fails to be the watchdog, leave aside being a support system. The constraints for a private school are related to unavailability/costs of funds, unviability of sustaining the business at human salaries (for employees) and absence of academic support. The quality of education in such private schools is no where close to comfortable levels. A lot of these schools are unrecognized and offer the owners a good opportunity to rob the parent and squeeze the teachers to make whatever ‘profit’ that is possible. The government school system does not offer much respite. Their are pockets of excellence in villages and districts but delivering quality in learning is still a long way away for most. Unionization of teachers, vested interests of education babus (from cluster to state level) and indifference of the elected representatives makes it difficult to hold anyone accountable. One could go on and on about what doesn’t work or what does but we would leave that for a later day and jump to the important constituent of this chain- the teacher.
A teacher connects the child to the world as well as connects the school to its audience (parents and children). Drawing the idea of a keystone in a distribution system (from another post i saw here), a teacher in many ways is the keystone in the system. She anchors many the classroom and manages the expectations and demands of various stakeholders of the education system. strong anchors go a long way in keeping things nicely coupled and ensuring robust flow of services.
What is needed to ensure a secure and efficient supply chain?
– Informed participation (the recipient knows the quality and the provider is responsive)
– Transparency (resources and contraints are identifiable, practices are questionable, solutions are possible)
– Responsibility (the buck should stop where it’s supposed to)

Distributor: Key to success in FMCG Distribution

This is a Guest Post by Kandarp Patel who works with a leading FMCG brand in the Sales and Marketing function.

In architecture jargon, keystone is the one which locks the other stones into their positions. That makes it structurally very important. If we apply the analogy to FMCG distribution channel, the Distributor is the keystone. He is called by various nomenclatures like Distributor, redistributors, dealer, wholesale dealer etc…but broadly defined and generally acceptable definition of the distributor is ‘A person or a firm who links the manufacturer/marketing company with the retailers.’ He is the one who purchases from the manufacturing company in bulk quantity and re-distribute it in small quantities to retailers. Let’s look at the position of the distributor in the whole distribution channel first and then define the role played by the distributor.

Role of Distributor: FMCG distributor generally has exclusive rights of distributing all products or a set of products in a defined geographical territory. In the given territory, he will be responsible for the redistribution of the products, retail penetration and market coverage. Sometimes, distributor is also appointed to serve a particular clientele base like hotels, canteens, restaurants etc. Traditionally a distributor is treated like a trader in the distribution channel. But now many organizations have started seeing distributors playing much bigger role. Following are some of the functions a distributor plays in modern FMCG channel.

• Basic role of distributor is to purchase/stock products in bulk from the manufacture and sell/distribute them to retailers in smaller quantity.
• Distributor takes orders from the retailers and institutions and ensures timely and quality delivery of products.
• Distributor maintains stock of the products to absorb the supply fluctuation from manufacturer.
• Distributor provides required financing for allowing credit to the retail market.
• Distributor is the person who will provide ground level data on demand estimation for the products.
• Distributor expands the retail universe (by opening new outlets) as well as the retail penetration of various products.
• Distributor takes up field level marketing activities like H2H promotions, inshop promotions etc.
• Distributor helps in minimizing consumer complaints and resolving them.

This basically clarifies the broad role of the distributor in modern FMCG channel. We will see the functions and daily routine of a typical distributor in the next part to finally derive the criteria for selection of a good FMCG distributor.