Growth

Bright Future for Auto-Industry

/ prabasiva / 2 Comments

Simplifying a complex problem by breaking into small solvable parts and using knowledge learned in a driving school during a fatal accident are simplification and abstraction techniques widely used in a practical  world. Have you ever noticed the behavior of a person during  a fatal accident? During an accident, provided the person is not seriously injured and able to think to their capacity, the capacity (volume) and capability (strength) of the person is fully utilized to face and over come the situation. The capacity, capability and the effective utilization of it during the crisis or fatal accident increases exponentially.  If some one deeply think about why most of the people become effective during the crisis is due to extreme focus the brain forces itself to get over the situation. That is ultimatum for some of existing meditation techniques and the same reason why some of the adventures sports like rock climbing are very attractive. It is a kind of enforcement mind brings to mind itself. But at the same time, mind does not perform the strategic analysis  to its best during the crisis mode and that is the same reason why the best supreme court lawyer hires another lawyer when they face a crisis.

How this is relevant to current auto industry?

Well, GM and Chrysler both have had faced a separate fatal accidents.  Both are utilizing their capacity, capability and utilizing it effectively. When it comes to survival, as Maslow theory in the management suggests, your basic needs becomes top most priority and enlightenment are out of focus.  The decisions and execution made in last few weeks generally would have taken decades in their corporate culture. Executive management totally understand how to move forward. With assistance with auto task forces, concessions with unions, agreement with debtors ,reduction in  dealer network, dropping a brand, focus on fuel efficiency and quality  are good signs for a great recovery.

Why a great recovery waiting for them?

Four years ago, US market sold 17.5 Million units per year. This year, industry is struggling to sell 10 Million units. The average car age in America today is 9 years old.  Car purchase is the second biggest purchase a consumer would make after the American dream of owning a house.  Consumer confidence is the key and it is and it will continue to gain slowly for next 9 months and rapidly after that.  The credit market is far better than it was 6 months ago with enough capital infusion to credit market. Introducing better credit standards, oversight and governance, the credit market is stabilizing. The moment a person believes their jobs are safe, the consumer confidence in stock market, retail purchase, credit market will raise and the consumer is going to donate their 10 years old car to charity and buy the fuel efficient (Hybrid, Diesel, Electric) car. Both GM, Chrysler are making tough choices now and getting  ready to meet the huge market demand in 18 months.

Until then, sit tight and be part of the touch choices and move Detroit to new 2011++ future.

Yes I hear you.., I have not written a blog for almost a month.. that is mainly due to my last few weeks focus on completing  the graduate course on Linear Algebra. I had my finals yesterday and thinking about, should I take Dynamical Systems and Choas theory in summer. It will definetely help to model the current economical situation!!!

2009 Economical-Magic

/ prabasiva / 1 Comment

Flow of electron is current and flow of cash is economics. If no electron flow then there is no current and if there is no cash flow then there is no bright economy. It is as simple as that.

What is the solution for the current economic crisis?

Increase consumer confidence

Consumer confidence is measured by the consumer confidence index and it is record low now. Economics is a social science studies the production, distribution, consumption of good & services. Consumption is the driver for distribution and production. The consumer adapts a conservative approach for consumption of goods and services and hence there is a slow down in the whole cycle. The conservative approach chosen by the consumer due to bleak future.  Consumer are not spending due to uncertain future and current & near future depends on the consumer spend. I call this situation as “economical dead lock”. 

The lock only be released by consumers and it depends on creating HOPE in them. Any big events in first quarter of 2009 is going to create that hope in consumer. The big event could  categorically be under  geo-political, scientific invention, leadership, Government policy.

The president elect going to sworn in first quarter of 2009 and he already made clear that his top priority is to focus on economy. By introducing new policies, regulation and deregulation in certain areas, introducing all construction projects are likely would  provide confidence in consumer that there is a bright future ahead. That magic would release the economical dead lock. 

It is highly likely that global economy will turn around by 3rd or 4th quarter of 2009.

General mentoring advise..

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I was asked by many mantes that how they can get a promotion in the organization. Well, it is a difficult question to answer. For anyone in an organization with any responsibility to move to the next level is contextual. In most of the organization, the organization structure is hierarchical, that is a pyramid, and higher you climb the pyramid, the lesser the growth opportunity. The top most of the pyramid is a point which is a person like CEO, CIO based on the organization you are in.

How to go to next level?

In an organization, generally, no body is going to tap your shoulder and ask you to move on in your career step. There are lots of opportunity exist in an organization and it is up to an individual to learn and grow in an organization. It is generally true. Luck is also a factor and persistent hard work creates luck.

Key principle to keep in mind before anyone consider to go to next level.

  • Be great in what you are currently doing (master the subject and be evangelist in that subject)
  • Let everyone know that you are really great in what you are doing. Do it shamelessly.

If you follow the above two principle and you consistently do it over a period of time (time depends on your position and organization) AND you need to ask this question to yourself. Are you ready for the next level? You need to honestly answer this question to yourself. Do NOT answer yes because of power, money, prestige etc. Honestly and truthfully answer to yourself. If the answer is yes because you think you are qualified to the next level then start build the network through mentoring. Perform mental shadowing. Observe the members in the organization who is in your to be level and analyze how they are performing their daily operation, how they deal their situation in a daily manner and position yourself in their shoes. How they did certain things, how they answered few questions asked in the town hall, deparment meeting, staff meeting etc and position yourself how you would have done it if you were in their position. Perform a variance analysis. The key is to select the top successful person in your next to be level. A role model.

If you keep doing this, I’m confident you will get where you want to be.