the elephants
When will the elephants dance?
I have been a very satisfied customer of MTNL’s broadband services and today when I went to MTNL’s office to ask for a connection (I had given up my earlier connection over an year back when I moved to Ahmedabad) they told that it will take no less than 6 months. Though disheartened I still thought I’d go for it and asked for the various plans to choose from. The lady handed me a plan list and marked out three plans saying that they were no longer available. On asking the reasons she said that these plans had not been making any money for MTNL.
No prizes for guessing which plans were they: the unlimited usage/download plans (the one I was using earlier). Contrast this to Reliance and Tata who are selling their net connections on the strength of these unlimited connections. How is it that private space is able to offer the customer a much better service despite the size, coffers, regulations etc being on the side of these PSUs.
Take any space: steel, telecom, oil, aviation and we find either the PSU is not making as much money as its private counterpart and if it is then it is because of its monopoly as customers have no choice. Its not that private players are using some way advanced technology, or that private companies emply people from Mars and Venus. I also don’t agree to the argument that employees in private sector are much more because the kind of perks the employees of pubic sector get bring them almost on par besides the power and influence they get to wield (I have the first hand experience of it when in public sector). I believe that this is because PSU ignore cost management. The costing costs these PSUs their profits, their market share and ultimately their reputation heavily. The public sector needs to make sure that the costs are managed scrupulously as declining profits threaten the nation’s savings (tax).
Given the economies of scales & scopes that the PSU manage, it is not tough for them to earn huge profits if only they paid some close and detailed attention to their costs. I am not talking of the wages and salaries (the PSU employees are already a harried lot). I am referring to costs of management, costs of running their businesses, costs of contacts, costs of sourcing, and the biggest of them all the cost of widespread tiny and medium level corruption (I have my solid reasons to believe that top level corrpution is almost out of the public sector machinery spare a lone instance once in a while).
Take IOC, a fortune company and I am sure that had it kept a good watch on its costs of operations it would have had better margins like its counterpart in the private sector. Its really surprising to note the difference in the margins that are earned by the public and private players in the same industry. I hope all the PPP’s are eclectic in the sense that the better of both comes out for the benefit of the nation.
Here is the video of the song that I had been listening to during major part of this week:
