I didn’t get on a plane till 2007. But after that, I have flown quite a few national and international routes and carriers. Irrespective of the route/carrier, I always find three aspects of the flying experience fascinating – Takeoff, the In-flight experience and the Landing.

Takeoff: The most exciting, adrenaline-pumping part of the flying experience. Every time the plane starts taxing, meandering this way and that on multiple sub-runways, accelerating a few times and then slowing down, my heartbeat starts increasing disproportionately. Every time the plane makes a temporary stop, I always feel the plane reached the main runway and is about to take off. But it doesn’t. And the wait just keeps getting longer. The plane finally clears all hurdles and queues and ends up on the runway. It stops and the engine sound is down to the minimum, as if to announce to the world that it is about to take off. I grip my seat handles and wait with bated breath. The jet engines start revving and within a second, you are pulled along at 350kmph, blasting through the runway. I am amazed at how the physics work. I am always amazed at the pilot’s brilliant maneuver of taking off the plane, without the tail of the plane ever hitting the tarmac. After about 15 seconds after takeoff, the plane appears to stop temporarily. My breath stops, fearing the worst, every single time. And the pilot seems to say ‘Ha! Gotcha’ and accelerates again. My senses are back to normal. My breath is normal. My pulse becomes normal. And we are in the air.

This happens every single time. And every single time, this experience is exhilarating.

In-flight experience: I am not talking about the different entertainment or movie options on planes. It differs from carrier to carrier and I am in no mood for market research on plane’s movies and entertainment options. I am however referring to the in-flight experience when the airhostess comes with food/coffee/towels etc.

Let me explain through an example.

Let’s say you are sitting in Row 16, aisle seat on the right. The food tray (you can replace this tray with drinks/ice-cream/towels/coffee etc.) is dragged all the way from the pantry which is behind you to the first seat. And then you see the tray moving every so slowly from Row to Row along with the airhostess. Mind you, you don’t want to appear greedy for the tray that is coming along (and born in the 80s, for me, flying in planes is still considered ‘posh and up-market). So, you distract yourself – reading this magazine or that, flipping randomly through movie options, knowing every second that the food tray is coming along. And then it arrives at Row 15. You look along eagerly, but not greedily or in an off-handed fashion. The airhostess might ask your preferences anytime now. Row 15 is complete and the tray ambles to Row 16. This is your moment in the sun. You are sitting on the right aisle seat. She is going to ask you now.

But she doesn’t. She turns to seats on the left, asking their preferences. The Damocles’ sword continues to hang. Yet again, the wait of appear-posh-but-not-offhanded continues. She finally finishes the left seats and turns to the right. NOW then. But, she just ignores you like you never existed on that plane and asks the person sitting in the window seat. You start fuming within, but smile outwardly. Again, a good smile, not a creepy smile. She finally asks you about your meal preference, gives your tray and goes along robotically to Row 17. Mission Accomplished. All emotions subside. You no longer have to think of what the air hostess is thinking of you. Food/drink to be had. Blank the rest of the plane out.

This happens every single time. And every single time, this experience is embarrassing.

Landing: The scariest part of the flying experience. The seat belt sign is switched on, the airhostess commands everyone to put on their seat belts, move the seats to the upright position, close the trays, make Manmohan talk and smile at the co-passenger who has been farting all along the ride. I can hear the wheels barreling out, the landscape rapidly becomes visible and I realize the speed at which the plane is going when you have passed a 100 vehicles on the super fast highway going parallel to the runway within a few seconds. The airport is visible at a distance this second and the plane’s hitting the tarmac the next. First, the rear wheels touch the tarmac, giving you a trailer of the bumps that are yet to be experienced. At this moment, the plane is all wobbly, trying desperately to hold its ground. And then, the front wheel hits the runway and that’s when you know what a bump means. That moment is the shittiest, scariest part of flying the plane (and by the way, most plane crashes happen when the front wheel doesn’t touch the runway properly – there I scarred you for the rest of your life! ). Once the entire plane is on the tarmac, the brakes kick in and the plane slows down and you breathe a sigh of relief.

This happens every single time. And every single time, this experience is frightening.

There you have it – Exhilarating, Embarrassing and Frightening. Every single time. But every plane ride is memorable. And the sheer physics of it fascinate me.

I love planes. Always did.

i) Youngsters waiting to bolt out of the country. Back in 1996-97 (and I guess before that period too), there was a mad rush to bolt out of India. Everyone were preparing for their SATs, GREs, GMATs, TOEFLs etc. or going to computer training institutes by the hundreds. The sole objective of these activities were to get out of the country and get into the distant dreamland called the US/UK where untold riches and green cards would befall on them. The IT boom-bust and 9/11 attacks notwithstanding, that desperation to get out of the country continued till about 2003 (I was also an enthusiast, till I suddenly decided not to go).

I hear similar stories now. The only change being that the list of countries is not just restricted to US/UK. The list of countries includes Singapore, Australia, Canada, New Zealand etc. Everyone I spoke to in the age 16-23 wanted to get out of the country (albeit, my sample size is small).

ii) This time though, the youngsters realize that there are no untold riches (although a few of them will hit a goldmine). They just wanted to lead a comfortable, hassle-free life. However, I think that there is more to it than meets the eye. I think there are a couple of reasons for this desperation to get out:

a) Lack of enough employment opportunities: The period of 2003-2008 was a golden period for Indian youth in terms of employment opportunities, real estate, MBA-leading-to-lakhs-of-rupees-starting-salary etc. Never before had India seen such surplus in all walks of life (atleast in the urban and semi-urban regions). Many youngsters wanted to stay back and mint money in India than go somewhere else where the economy was not exactly ‘booming’. However, post 2008, the employment opportunities have dried up, and if you are not from a Top 10 Engg/MBA school, the jobs and salaries you get are not ‘exciting enough’. Post 2008, the increments and onsite opportunities in the IT industry (which hires a majority of the student population) have dried up and the outlook is not very bright (maybe bright from a business standpoint, but from an IT employee standpoint – not so much). A few statistics which get thrown out from a population standpoint include 250 mn between the age of 0-10, 250 mn between the age 11-20 and 250 mn between the age 21-30 by 2020 in India, and the youngsters realize that there is a tsunami of competition coming behind them. Couple that with relentless inflation in real estate, daily commodities and the like, the inflation-adjusted-salary-and-savings amounts to nothing. Reduced opportunities, increased competition and spiraling costs is a recipe for disaster. Hence, the bolting.

b) Apathy: Again, the period 2003-2008 led India to believe that there could be change in the way we functioned, change in the way we governed, change in the way how systems worked etc. That hope rapidly dwindled post 2008 when scams, protests, lack of effective governance erupted. People getting raped, murdered and mutilated in broad daylight led to no arrests or convictions. The eternal question of ‘What’s in it for me?’ strikes everybody and seeing no hope in improvement of governance, people bolt to other countries where there is a hope of a fair, if not good, governance.

iii) People who went to other countries pre-2003 wanted to desperately come back in the ‘boom’ period of 2003-08. There is an unusual theory called ‘x+1’ which explains the behavior of Indians outside India. Whenever you ask ‘So, when are you planning to come back to India?’, they give you a standard answer of ‘Next year for sure’. And when you ask them next year, they will obviously reply with ‘Next year for sure’ and so on and so forth. However, this began to change, in real numbers and not just fictional hopes in the period 2003-08. Post 2008 however, this statistic again changed to just a hope. In fact, the answers shifted to ‘maybe next year’. I could never understand why people say ‘maybe next year’ even after they have a green card/citizenship/there is no plan to come back (and 9 out of 10 cases, people don’t come back. Even if they do, they run back within a year or two citing pollution, bad governance, kid’s adjustment problems etc.). Maybe it is to assuage some remote guilt that they have left the country. I really don’t understand – if you want to leave the country, leave. If you want to stay and settle there, stay there. You know what is best for you. Why have that remote guilt is something I could never understand. Anyway, these days, I hear ‘maybe next year’, the same response I used to hear pre-2003, the response which can be decoded as ‘maybe never’.

I wish I could say things are not that bad. They are bad, and I see employment opportunities dwindling by the day and spiraling costs by the month. However, I have had the opportunity to see the other side of India – youngsters relentlessly working on their ideas, on their businesses, on startups – all of it in India. Hope, as my favorite movie says, is a good thing, maybe the best of things. And without it, we are all dead.

P.S: I am not endorsing staying in India and fighting it out etc. You do what is best for you, without any regret. In fact, for all you know, I might bolt some day. I just wanted to bring in the perspective of ‘history repeats relentlessly’.

As I stated in my last year’s post, every 1st of January, we contemplate and formulate. We enter into a mystic dance with hindsight and probability and most probably forget most of the promises and resolutions in a week or so. Yet, a new year is always a new beginning and a new beginning always has to be done with the best of things – hope.

We hope for health, happiness and prosperity for our near and dear. And a few extra zeroes in our bank account would not be too bad either

Instead of talking global gyaan about how stock markets have been unleashed but personal freedoms curbed, how sympathy’s got a shorter news cycle while apathy’s got an infinite one, about how Sachin’s retirement affects the world of cricket but Sreesanth’s return doesn’t, I thought I’d reflect on some personal thoughts I have been having over the past week.

a) As I age and transition from 20s to early 30s, faster are the years going by . I am dead sure 2013 is going to go faster than 2012.

b) The professional move, after a lot of deliberation and discussion has been made in 2012. So far so good. Hindsight regret is the worst of all regrets and given what I have seen so far in the new organization, this regret is not going to happen.

c) The utility of close family and friends, for the lack of a better phrase, has been reinforced time and again this year. Sanity has prevailed solely due to them and them alone. Why and how they tolerate my quirks is still beyond me, but immensely thankful to God that they have stuck through.

d) The urge to blog more often always exists under the surface. But it’s been just that. Just as always, the resolution is to blog more, read more, speak less and stay relevant.

e) 2012 has been a disappointment from a new-skill-learning standpoint. I only reinforced what I learnt in 2011 either on the work front or the investing front. I do hope I learn something new in 2013 to keep the adrenaline going.

f) Twitter has been god-sent in terms of meeting and interacting with some extremely smart people and curating specific news that I’d like to follow and contribute to.

g) I have been on FB less and less, to the extent that I log in to FB only to push content and pull very little of it. Good or bad, I intend to flow with the water on this one rather than changing that way or this.

h) Some friendships were rekindled, a few extremely deep conversations were had, a lot of exciting and exasperating moments were experienced.

i) Read some fantastic books in 2012. Will update the book list shortly.

Here’s looking forward to a great 2013 ahead then! And as always, I sign off, like last year with T.S.Eliot –

For last year’s words belong to last year’s language
And next year’s words await another voice
And all shall be well and
All manner of things shall be well.

Last month, I transitioned from the late 20s to the dreaded early thirties. Of course, I am not going to bore you with the details of the decade gone by and a decade to look forward to. I don’t feel any difference as such, except that the recovery time between badminton games has got a wee bit longer.

A more important transition, in terms of career has finally happened. I have moved from Wipro to Accenture Management Consulting. The past week was my first week with Accenture and the experience was quite contrasting – taking a different route to work, different office setting, different people and a different way of working. Wipro, after all, was my workplace for 6 years.

It was a wonderful 6 years in Wipro. The last 6 years in the banking domain consulting team constituted an immense learning curve, learning and contributing, leading-and-being led across different geographies, assignments and clients. I also have had fond interactions, intense discussions and humorous jargon-creation exercises and in the process, cultivated many friends, mentors and acquaintances.

I also had the pleasure to interact with brilliant client partners, visionary leaders, outstandingly strong domain experts and terrific development teams.

I wish I could say the above two paragraphs were a joke, and laugh away at a get-together, but they are not.

But a time does come when you feel your aspirations are not met, the organization and your paths diverge and the goal is not a common one. I had felt it over the past year, but tried to trudge through the organizational maze. Truth be said, in this period, I did receive quite a few opportunities in other organizations. However, the options were not too exciting or to put it more scientifically, the opportunity cost was pretty huge.

However, the opportunity at Accenture is quite an exciting one and after extensive discussions with mentors and close friends, I finally said goodbye to Wipro and said yes to the opportunity at Accenture.

Who knows what future holds, as future, is just a possibility. Here’s to Wipro and Accenture then.

Adios Wipro. Hello Accenture.

As far as my reading goes, this kind of facility across almost all banks is not even available in the US or UK (or most of the developed world).

What exactly is this world-class (and I think India-changing which I elaborate below) facility? And more importantly, how does it benefit me (or you)?

The Niggle: Today, most people in India transfer cash (or make payments) through NEFT (National Electronic Funds Transfer) or RTGS (Real time Gross Settlement). If you had to make a transfer between banks (say, a transfer between Citibank and ICICI Bank), you would log in to your system, and request for a payments transfer. Depending on which bank you had your account with, and depending on when you initiated the transaction, the payment would reach the recipient only on the next day or two. If there are Holidays/Sundays in between, the transfer of this payment would take even more time (an extra day or two). (For the technically curious as to why this happens, it happens due to a process called ‘clearing’ where transactions are bunched in ‘batches’ and banks transfer money to one another on each ‘batch’. Depending on which ‘batch’ your payment is in, and depending on when the ‘batch’ is processed, the recipient would get the money the same day/next day/next-next-day).

This delay in making payments, though not a serious problem, is no doubt an irritating niggle. For e.g., if I had to transfer money between two accounts of mine, or if I suddenly ran out of cash in my account and so on and so forth.

The Solution: Enter IMPS. Through this facility you can transfer money instantly between two banks instantly (well, roughly it would take 30 seconds) via your mobile. In fact, you can transfer (and receive) money to (from) anybody who has a bank account (from your account) instantly and cheaply (very cheaply – details below). You can transfer/receive money 24x7x365. No restriction on timings, no restrictions on Sundays/Holidays etc. How cool is that? And yes, I tried it out and it worked. It was quite thrilling to see money transferred instantaneously as well as seeing it in your bank statement almost immediately. Let’s get to the details now.

Implementation: My colleague Vishal helped me out with this trial. Steps below -

a) We decided that I would be the transferor of a princely sum of Rs. 10/- and he would be the receiver of this grand sum.

b) Vishal had a Citibank account. His phone number was also tied to his Citibank account (crucial). He had to generate something called MMID (Mobile Money Identifier; an intermediate ID to protect your account number being divulged at the same time useful for a error-free authentication (explained below)). He could do that by sending a SMS: MMID XXXX to 52484 (XXXX is the last 4 digits of your debit card number). Citibank immediately responded back with a unique MMID tied to Vishal’s account and phone number.

c) He gave me his phone number and MMID and nothing else (no account number etc.)

d) I had to go to Citibank’s site (online or mobile), log in to my account and add Vishal as a payee (one-time process). I just had to quote his mobile number and MMID – he was added as a payee (no jhig-jhig of IFSC code, Account number and rest of the paraphernalia).

e) Now all I had to do was send the following SMS: IMPS <Recipient’s Mobile Number> <Recipient’s MMID> <Amount you want to send> <XXXX (last 4-digits of your debit card)> to 52484. Sending this SMS cost me Rs. 3/-.

f) A humungous sum of Rs. 10/- was debited from my account and credited into Vishal’s account immediately. Both of us got a SMS informing us of this transaction in less than 30 seconds.

A picture is worth a thousand words. So here it is -

I was thrilled to bits. Irrespective of the money sent, the only amount I had to pay was for the SMS.

This was an experiment I tried between two Citibank accounts. Subsequently, I tried this out between Banks (between my Citibank account and a friend’s ICICI Bank account). It worked perfectly. Transaction done in less than 30 seconds.

The SMS way was one of the ways in which you could transfer money. The other one was through downloading the app way. The app will guide you to get a MMID as well as transfer the money. If you go through the App, I don’t think you need to pay Rs. 3/- for the SMS also (I hear it would be only 10 paisa per transaction – not confirmed though).

After these two experiments, I researched on a few banks and each bank has a different process of getting a MMID. So, please check up on your bank and get your MMID. The process is really easy. Trust me. Go, get one now. Even Dombivili Sarkari Bank is in on this, so I am pretty sure almost every major bank is supporting IMPS.

Security: I tried thinking of various possibilities for hacking this, but they have made it quite fool-proof. You need to know the phone number and MMID of the person to transfer money (prevents money laundering as well serves as error-proof way since you need to enter both correctly to get the transaction through). If you have added the person as payee, the money that can be transferred is restricted to Rs. 50k per day. If it is only a one-time transaction (that is, you have not added the person as a payee), you can transfer only Rs. 1000.

This is amazing stuff. None of the US/UK/Developed nations have this facility yet. Just go get a MMID right now through the SMS way or the App way and transfer/receive away money.

(For the technically curious as to how they do it – well, they use NFS (National Financial Switch). This is the same infrastructure through which you can withdraw money from a Corporation bank ATM although your account is with Axis Bank. Technical details are beyond the scope of this post).

Why did I call this IMPS as an India-changing initiative?

I have a lot of ideas of how effectively this can be used. A few of them listed here -

a) First and foremost, and the most obvious, transfer money to friends and family instantly. For e.g., split dinner between friends, emergency funds in the middle of the night, transfer money for wife’s shopping etc.

b) Second. Shopping websites can given an additional discount if you pay through IMPS. Reason being cash is being immediately transferred, compared to a credit card where the cash is transferred to the vendor only after 2-5 days.

c) You can pay at shops, malls, vendors (vegetable, plumber, carpenter etc.) through this. Cash can be eliminated to a large extent (trust of course is a factor, but that’ll come as time goes by). If you are in for fancy, even stuff like contactless payments can be eliminated.

d) Biggest benefit is for far flung villages and towns (and this is India-changing) (Tier 3 to Tier 6 villages). Most of this population is under-banked. Two reasons being – bank branches cannot be profitable here and two, it would take a lot of time and effort for villagers to come down to a branch to withdraw/deposit money (which, for villagers most of whom are paid by the day, is a loss of income too). However, if and when this IMPS is marketed well and trust is built, villagers no longer need to come down to a branch. Everything can happen on a mobile (and given that most banks have a SMS IMPS facility, you don’t even need fancy smartphones and internet connections). And nowadays almost everybody has a mobile. The possibilities from here are endless.

Absolutely fascinating stuff this. I think this will probably be one of the most important revolutions in payments that India has ever seen.

The Joker in the Pack

IMPS has been in effect for a year now. Yes, a year. But how many of us have heard of it? I think very few (I heard it only a month ago, and implemented it today). Banks for some reason have not marketed this well. I venture a couple of guesses -

a) 10 paise per transaction is not really exciting. Even if SMS transaction revenue (Rs.3/- per SMS) is being shared with the Banks, considering how other VAS providers are paid (the operator takes a 70% cut), not too sure if Banks are too excited about the revenue of this format.

b) The bigger revenue, float is missing. Let me explain. For example, you initiate a Rs. 5000/- NEFT transaction and transfer it to your friend on 11th July 2012. Your friend would get this money only on 12th/13th July (depending on the Bank). The Bank will earn an interest on this Rs.5000/- for this day or two. Now multiply this Rs.5000/- by all the NEFT transactions and the interest the Bank earns, it amounts to a tidy sum. In IMPS, since the money transfer is immediate, the Bank cannot earn any float. So, if IMPS goes mainstream, Banks will lose a lot of float revenue. Hence, very little marketing on this forum.

It looks like Banks have this on their website only because NPCI (a Govt. entity regarding payments) forced them to. NPCI again has its own agenda of defeating MasterCard and Visa in India, and introducing its own network Rupay. So, it’s all one sphagetti of interests and revenues

Anyway, my  conclusion is that IMPS is a revolutionary concept and is here to stay and grow BIG time. Look at the volumes here. Close to 6 times jump in about a year. Long way to go!!

Till date that is.

The story goes something like this – One day, I discovered that the kid down the road knew far more on how to navigate apps on a smartphone, the best apps in Android/iOS and in general, feeling very hip about the whole thing that he had the latest smartphone and knew how to use it. On the other hand, I didn’t know how to even flip across screens on the smartphone. That was the day I decided to invest in a smartphone.

Being the cost-conscious one, not spending on frivolous and technologically-transitory things like a smartphone all these years (my wife of course has various wonderful-sounding gaalis for the above behavior), I decided to play a mental game and evaluate the purchase of a mobile phone through standard economic theory.

My needs:

a) I am not too brand-conscious.

b) Functioning phone with a minimum ability to talk and have basic smartphone capabilities, and with a maximum ability to have everything under the sun.

c) Very little maintenance (zero phone repair)

Evaluation:

Step 1: The first thing about any electronic item, especially a mobile phone is that the models/technology gets obsolescent real fast. In fact, with the Jelly Bean update (fancy name for Android 4.1 OS version), the recently released Samsung Galaxy SIII is also old. And then you have personal assistants like Siri/Aisha/Google Now, screen resolutions rapidly getting better by the hour etc. Therefore, purchasing and holding a mobile phone beyond one year doesn’t make sense. By the time you purchase and hold a phone for one year, it would have become obsolescent. You will not have ‘kept up with the times’ (I hear that it’s the cool phrase nowadays).

Step 2: In the spirit of ‘keeping up with the times’, let’s say we do decide to purchase a smartphone. Now, smartphones are usually not cheap and the good ones start at around Rs. 20k. Given that Rs.20k is to be used only for a year or so (since we always want the latest phones) (resale will give you maybe 10% of value at best, I think unless you decide to resale it in 2112 as antique), the price is very steep. Is there a slightly lesser cutting-edge phone, but has almost all features of a smartphone and can work fairly well? Yes there is. Micromax to the rescue, and I have heard great things about this phone, which has a personal assistant as well (which means fairly cutting edge – since the other phone that has a personal assistant costs about Rs. 40k).

Step 3: Great. So, how should we think about this purchase? The phone costs Rs. 6k. Assume we wanted to spend about Rs. 16k on a good smartphone, if Micromax wasn’t around. So, that’s technically a Rs. 10k saving.

Why did I do this mental calculation? The reason being, if I can put Rs. 10k in a fixed deposit earning 10% p.a (ignore pesky taxes), I will be earning Rs. 1k per year as interest.

Next year, my Micromax phone (along with all other phones in the market) would have been outdated. So, I am going to junk this phone say for Rs. 500/- and purchase the latest Micromax with the latest features next year. Considering the economics of manufacturing mobile phones in China/Taiwan, I don’t see the prices of mobile phones moving upwards anytime soon.

That is, I would have purchased the latest Micromax phone next year for about Rs. 4.5k (Rs. 6k (phone cost) – Rs. 1k interest – Rs. 0.5k junk value). In fact, the best part is, due to these calculations, I don’t even have to feel guilty of chucking phones and buying a new phone with the latest features at just Rs. 4.5k (it would pain a lot if it was Rs. 19.5k, no?).

Step 4: Fantastic. But it gets better. If I continue this line of thought, and say, you can chuck and buy a new phone every year, you would observe that your cost of buying a phone will tend to zero as the years go by (depending on how much junk value you can derive). That is, at some point, I will be owning the latest smartphone with all the features for free. And since you are holding a phone for only one year, the probability of the phone getting to the repair shop is very low.

Let me rewind.

In Plan A – you would have spent Rs. 16k on a phone (in 2012).

In Plan B – you would have spend Rs. 6k (in 2012) + Rs. 4.5k (in 2013) + Rs. 4k (in 2014) + Rs. 3.5k (in 2015) = Rs. 18k. That is, you would have spend Rs. 18k only by 2015, and still have the latest smartphone. On the other hand, by 2015, your phone in Plan A would look like a brick from Neanderthal age.

As I said earlier, I am not really brand-conscious. So, this logic wouldn’t work with people who have an ‘image’ to maintain. I never understood how you can maintain an ‘image’ with your phone – probably I don’t have the right set of people around me.

Analysis complete. Awesome. Patting oneself on the back and all that. I decide to buy a Micromax phone as soon as possible (which meant, whenever my khatara phone stops functioning).

I explained this logic to my colleagues and friends – they wholeheartedly agreed with me. In fact, one colleague did follow this logic/advice with much enthusiasm.

I explained this to my wife – and she wholeheartedly agreed with me, nodding her head as vigorously as she could .

And then, she went ahead and bought this phone, which costs about Rs. 13k and gifted it to me (in parliamentary language terms, she asked me to drown my khatara phone in one of the most polluted drains in India (musi river) before handing over the new box. That vigorous head nodding should have been my cue, I realized later). All my logic and economic theory down the rabbit hole. The question really is, should I be happy that she gifted an awesome phone or should I be sad that all that explaining and logic evaporated in thin air?

One wise man, back in the day, truly said ‘Man proposes, wife disposes’. And I bow to thee. Truer words than this have not been said.

In this age of Re. 1 newspapers and Rs. 15/- business magazines, here is The Economist with a retail price of Rs. 200/-. I don’t have the guts to spend Rs. 200/- every week to read a magazine.

Neither do a majority of Indians, I guess. From whatever I could gather from my friends’ circle, most of them read The Economist in libraries. Rs.200/- is obviously very expensive. Since retail subscription hasn’t taken of (I make a sweeping assumption based on my small sample), The Economist decided to do what every other business magazine in India has done – discount the 1 year subscription price.

This is where it gets interesting. I have about 3 offers and I need to choose 1 among the 3.

a) I got a marketing email from The Economist asking me to purchase 12 issues (1 quarter) of The Economist for Rs. 500/-. Considering each issue costs Rs.200/-, this seems like a great deal. However, they follow up with, ‘for every following quarter of the year, you need to pay Rs. 1250/-’. Therefore the effective cost per year works to around Rs. 4250/- (500+1250*3) (compared to Rs. 10200/- if I buy the magazine every other week for 51 weeks).

b) And then there is this deal. I need to pay Rs. 5000/- and get access to all the 51 issues of The Economist. I will also get a wonderful Hidedesign bag (worth whatever) for free. Compared to deal (a), the value you can attach to the Hidedesign bag is Rs. 750/- (which on random checking with the wife is pretty much a steal since comparable bags on various discount sites is around Rs. 3-6k! The bag in itself looks hideous to me ).

c) And then there is this deal. 6 month subscription (on renewal) only for Rs. 2200/- (but without any free gift thrown in).  So, you can match deal a) with deal c) and get a 9 month subscription for just Rs. 2700/-. Once I am on it for 9 months, given the magazine economics, you can pretty much bet on a great deal for the next 3 months (say another 700 bucks). Effective cost for 51 issues? Rs. 3400/-.

So effectively, if you are even remotely interested in the Hidedesign bag, the logical choice would be to go with option b). Else, option c) looks better.

I have decided that I will do even more ‘chindigiri’ (cheapness) and call up The Economist call center, promise them I will pay them Rs. 500/- each quarter (in fact, they can block Rs. 2000/- right away) and also ask them to throw in a free gift for this loyal customer like this passport wallet of this offer

b) Red Label Tea: I noticed this phenomenon yesterday while shopping for groceries.

Hindustan Unilever (HUL) has a tea product branded as Brooke Bond Red Label Tea. The name is posh and has a very loyal following among the South Indian community. The pricing of it though seemed very strange (all prices quoted are printed prices on the box, not any retailer’s discount).

100g packet is priced at Rs.25/-

245g packet is priced at Rs.80/- and

490g packet is priced at Rs.159/-

Now, just to ensure there is clarity all around, it is of the same sub-brand (flavor if you will) and the package date difference is within a couple of days (just in case you went with ‘old stock vs new stock’ argument).

Now, basic math would indicate that a 500g (or 490g for difficult math) would be priced around Rs. 125/- (and a 245g packet would be priced around Rs. 62.5/-). But there is a whopping 28% price difference between the packets. In fact, it is a strange coincidence. The price difference between a 100g and a 245g packet is 28% and the price difference between a 100g packet and a 490g packet is also exactly 28%. Conclusion? Deliberate mis-pricing.

Tea packets are not like shampoo packets where each satchet is used seperately (even in shampoos, the pricing is not this way off (+-5% differential). Also, in shampoos, there is also the cost of the container that needs to be taken into account). Tea powder on the other hand is a different beast. Irrespective of whether I buy a 100g packet or a 500g packet, I’d come home, cut the packet and pour the entire content into a dabba (container) (unlike shampoos, where such an activity is extremely cumbersome). Quantity in this case doesn’t matter.

So, HUL is basically banking on the consumer’s stupidity to not check prices of a 100g vs a 490g tea powder (more newspapery would be ‘because of the rising income levels of the Indian middle class and an emerging superpower, HUL has decided to price the higher volume packets at higher prices’).

In conclusion, you’d be much better off taking 5x100g packets than one single 490g packet and save a whopping 28% (now that IS a deal!).

Inspite of this consumer-y rant against HUL, one tip for HUL (if I may!). HUL atleast needs to look at its product placement strategy. 100g packets are kept side-by-side of the 245g and 490g packets today across 3 retail chains I checked yesterday. The least they could do is to keep them atleast 10-20m apart in the retail store so that checking of prices by consumers won’t become this easy and their deliberate mis-pricing would be hidden for a longer time

On the 14^th of March, 2011, couple of days after a massive earthquake and a subsequent tsunami hit Japan, I decided to go surfing. I guessed that since fear-mongering would be the highest for a couple of days, I would find a lot less people than usual on the beach, and thereby giving me a peaceful and yet enjoyable experience on the beach. I was right about lesser number of people turning up at the beach. Enjoyable experience – not so much.

Sydney is a host to quite a lot of attractive beaches, and Manly beach is one among them. It is also a beach known for its incredible waves which makes it just the right place for surfing. For the experienced surfers that is.

The main assumption of course is that I considered myself a good swimmer before stepping into the waters. This assumption comes back to bite me in the back and haunt me later.

Here is my story.

As I looked across Manly beach, I saw many an experienced surfer cutting across waves and surfing on a few outrageous waves. I rented a surfboard across the beach for one hour and waded into the waters almost immediately. At first, the surfboard was difficult to handle. Paddling was difficult, much less standing on the surfboard. The surfboard has a latch which you strap on to the right leg so that you and your surfboard are always together (and hence would not lose the surfboard). After some struggle, slowly but surely, over the next half an hour or so, I started gaining control of the surfboard. I was able to stand on the short waves which were close to the shore line. I was able to ride the waves not as confidently as the experienced surfers, but fairly well. This was exciting stuff. It was a totally new experience, and I was loving every moment of it. I did it again and again and again. Each time, I was growing more and more confident of my surfing skills.

As I grew more confident of surfing the shallow waters close to the shore line, a thought crept into me. Why not surf the bigger wave? It’s logical, isn’t it? Of course it is (rationalization is a, as I stated in my earlier blog posts is as close to ‘bitch’ as it gets). And so I surfed back to the sands of the beach, and keenly observed the experienced surfers for about 10 minutes on how exactly they were going about their deep-sea surfing. It looked like a simple procedure. You swim into the deep sea, wait for the wave to come along, turn your surfboard in the direction of the wave, paddle hard so that you maintain some velocity and once the wave begins to take you along, you just stand up. The basics were the same irrespective of whether it was the shallow waves or the deep-sea waves.

Or so it seemed.

I waded through the shallow waters into the deep sea. My initial idea was not to go beyond 15 meters from the shore line. I assumed I could swim back pretty easily (you remember the good swimmer part above – yeah that!) if I was not able to surf properly. I severely underestimated two things – a) the ability of the sea to pull me back within itself along with the water b) the fear the roar of the waves create when you are caught in the middle of it.

As I moved in, the waves were hitting rapidly and furiously. Sea water, as is the case usually, is salty and this water at Manly beach was saltier than normal. And when this kind of salty water gets into your eyes, it burns like hell. I kept going for about 10 meters or so. I looked back at the shore line and I was hardly any distance away from it. I kept walking into the sea and by the time I realized what had happened (a big wave or two had passed over), I was close to 50 meters into the sea. I looked back at the shore line in horror.

I had my surfboard, but it was not of much use because of the rapidity and the speed at which the waves were coming on 50 meters into the sea. I had absolutely no surfing experience till date (except for the briefly and quickly learnt skill in shallow waters) and the huge volume of water and the roar of the waves (especially the white froth that comes at you at your eye level) around me sent a shudder through my spine. I was literally shaking. I couldn’t even see properly as my eyes were burning.

I quickly came to my senses. I thought I would swim back to the shore line. Wrong assumption again. I furiously starting using all the tips and tricks I had learnt during swimming (‘good swimmer’ you know!). Instead of moving towards the shore line, the waves were taking me away from it inspite of my frantic swimming. I was going deeper and deeper into the sea. And then, a swimmer’s worst nightmare happened. ‘Gulp, gulp’ I started gulping water. That’s when I realized I was dying. Not maybe dying, but very close to it. As a swimmer, you are never taught to drink water – and here I was, after close to 15-20 minutes of trying to fight the sea, gulping water. I told myself, ‘Screw it, I am calling for help!’

And then I screamed. I screamed ‘Help, Help’. The worst part about screaming 50 meters into the sea, with huge waves rushing above and past you is you have no idea whether your scream reached other surfers, much less the beach-crew. I probably screamed four times, before I gulped even more water ‘Gulp, gulp’. And then I saw this beach-crew guy coming towards me on his surfboard. It surprised me how quickly he reached me. The first thing he did was to remove the strap on my leg (the strap which ties me to the surfboard) and from then on, I was able to swim easily. I tried climbing on to his surfboard but a huge wave hit us from behind. I swum along with the wave with probably the last ounce of my energy and finally reached the shore line. My surf board followed me, although not tied to me.

I sat on the beach sapped of energy. I was trying to puke the salt water that got in, but couldn’t. It was a nauseating feeling. The sun was beating down, but I didn’t have energy to even stand up, much less move into a shade. After about half an hour, I mustered some energy to return the surfboard and sit in the shade. It was probably an hour before some I had some energy to take a bath and wear fresh clothes.

I looked at the sea from afar, calm at the shoreline and furious beyond. I did not smile. I was probably thankful. Or probably it was fear. I would never know. I had just learnt that sea was a dangerous being, if not handled properly (an understatement?). I probably learnt a bit of surfing in the meanwhile, but the experience of getting so close to death and yet so far from it is humbling. Or probably mind-boggling. I would never know.

P.S: If you have missed them earlier, here are the travelogues I had written on Sydney -

a) Sydney Part 1 Travelogue

b) Sydney Part 2 Travelogue

If it were a school debate, the subject of the topic would be ‘Sodexo coupons – A boon or a curse. Discuss’.

Fortunately most of us are past that stage of life where we need to debate such issues in front of other school kids. Unfortunately though, unless we discuss and debate, we would lose money on a transaction like this. Let us look at the bare bone facts of the Sodexo business and try to draw some conclusions.

The perquisite valuation rule (Sodexo/Food coupon is a perk) (Fringe Benefit tax) governing the issuance of Food coupons states (Rule 3(7)(iii)) -

(iii) The value of free food and non-alcoholic beverages provided by the employer to an employee shall be the amount of expenditure incurred by such employer. The amount so determined shall be reduced by the amount, if any, paid or recovered from the employee for such benefit or amenity:

Provided that nothing contained in this clause shall apply to free food and non-alcoholic beverages provided by such employer during working hours at office or business premises or through paid vouchers which are not transferable and usable only at eating joints, to the extent the value thereof either case does not exceed fifty rupees per meal or to tea or snacks provided during working hours or to free food and non-alcoholic beverages during working hours provided in a remote area or an off-shore installation.

If you didn’t have the patience to go through the rule, here’s what it states in summary. The Employer cannot pay more than Rs. 50/- per meal during working hours. Assuming a reasonable 2 meals per day and 22 working days in a month, it works out to Rs. 2200/- p.m food coupons (which is the limit that most of us get) (the max. anyone can get is Rs. 3000/-). Of course, since the Employer cannot pay more than Rs. 50/- per meal, the maximum value of any one Sodexho coupon cannot exceed Rs. 50/-. Hence the denominations are always Rs. 50/- or lower (usually they are Rs. 50/-, Rs. 35/-, Rs. 20/- and Rs. 10/-).

These coupons are useful for different parties in multiple ways. There are four parties involved in any food coupon transaction as illustrated below (along with Sodexo’s business model):

Employee: The Employee is usually very excited with any prospect that saves him a little tax. And so is the case with Sodexo coupons too, where availing the Sodexo coupon opportunity will make the food coupon amount tax free. For employees in the highest tax bracket (30%), this would save tax of Rs. 660/- p.m (or Rs. 7920/- per year). Of course, if you didn’t opt for the coupons, you would get Rs. 1540 as deposit in your bank account (Rs.2200/- after tax deduction). But did the food coupon craze take off in huge numbers just because an Employee could save some tax and buy food from his office canteen? Absolutely not. The reason it took off was because the retail chains (FoodWorld, Spencers, Foodbazaar, Big Bazaar, MK Retail, Total, Reliance etc.) started accepting the coupons for anything and everything that you purchase at their store. Employees jumped at the opportunity (and most people mentally classify these coupons as free money than hard cash – look at some stuff they buy using the coupons. They would never buy it with hard cash).

Company: Most companies started this perk out as a differentiator to employees (and marketed it as ‘it’s actually extra money in your pocket since it’s tax-free). And then all companies started offering it. From a nice-to-have feature, it has now turned into a must-have feature in the pay package. Companies don’t make or lose any money on this transaction (apart from the administrative headache).

Retail Store: Initially, the retail store used to accept Sodexo coupons only for pure food item purchases. It was a pure sales/marketing tactic from thereon – to attract more customers and to wean away customers from other competing chains, they started accepting Sodexo coupons for anything and sundry (which apart from increased sales, also increased customer loyalty). Eventually, competitive destruction happened and the retail chains till Dec 31st, 2011 accepted Sodexo coupons for all purchases. They redeemed their Sodexo coupons with Sodexo for a 5% discount (and they used to receive cash only after 20-30 days after submitting the coupon; credit card companies credit the retail store within 24 hours usually). It’s almost become mandatory for retail chains to accept Sodexo, else they risked losing customers to other retail chains and very fast (the cornershop marwariwala lost his business this way, till of course he also started accepting Sodexo!). Of course, to cover up the lost 5%, people usually concur on the fact that retail stores usually mark up the prices of certain items (although this cannot be corroborated with any data available).

Sodexo: Who exactly is Sodexo? This link gives more information (and this one in more juicier detail), but in summary, Sodexo is a French multinational corporation Sodexo is one of the largest food services and facilities management companies in the world, with 380,000 employees, representing 130 nationalities, present on 34,000 sites in 80 countries. They are the biggest beneficiary in this transaction. Since this is almost like a parallel currency, they have to invest a lot of money upfront to get the govt. machinery working in passing certain laws. They make money in three ways:

a) They receive Rs.100/- worth of coupons, while give back only Rs. 95/- in cash, netting a straight 5% gain.

b) Sodexo coupons usually come with an expiry date (think of it as a currency with expiry date *shudder*). Once its expired, no retail store would accept it and it becomes null and void. However, Sodexo had already received the money from your Company when they issued the coupon (and hence a 100% profit!). There is a complex process through which you can get new coupons issued, but most people would not have the time or the patience to go through the process for getting the new coupons.

c) The biggest of them all. They get money at 0% interest. Have a look at the diagram once again. Day 1, they receive Rs. 100/-. Day 24-34, they give back Rs. 95/-. That is, they have had the money for a full 20-30 days without paying any interest. In fact, till the coupon is used, it is practically free money (and they can lend this money at interest, thereby making money).

So, if this was a win-win-win-win arrangement for all the folks involved, why did the retail store chains suddenly stop taking Sodexo coupons in lieu of items?

There is no clarity on what exactly happened, but here are the news items floating around -

a) They have increased the brokerage from 5% to 9%. That is, the retail chains used to get back Rs. 95/- of their money, but in the revised scenario, would get back Rs. 91/-. Already under pressure for margins, this was not acceptable by retail chains. Presumably, they formed a clique and stopped taking the coupons across the table.

b) The number of days in which cash conversion happens has gone up from 20 days to close to 60 days, thereby impacting the cash cycle of organizations

thereby, resulting in a clique where the retail chains have closed ranks and have decided to put up a fight with Sodexo – to i) reduce the brokerage rate below 5% (and they’ll eventually settle to the original 5% figure) and ii) reduce the cash conversion cycle (and settle back on the 20-30 day figure).

Sodexo certainly has to negotiate and accede to the demands of the retail chains, simply because without them, Sodexo ceases to exist. Retail chains will also join the negotiating table because they will have too much to lose (the corner stone marwariwallah is still accepting Sodexos, and more probably, there is always a possibility that one retail chain breaks away from the clique to grab customers quickly). All in all, this is bound to be a temporary situation (max of 1-2 months), and as usual, the employee is being inconvenienced for the greater good of the mankind or some such.

My personal opinion is that the entire Sodexo tamasha is not worth the administrative hassle that most companies undergo (the big IT firms have everything automated, but all other firms are not). Why not give Rs. 2200/- as a food perk straightaway as cash instead of this circuitous food coupon route? Or tax it at the minimum rate? This whole hassle could have been avoided. But then again, there are vested interests at play here and I am not even a micro-bit player in the rational minority.  (As an aside, I always wondered about an active secondary market. For example, you get Rs. 2200/- worth of coupons and you save Rs. 600/- in tax. Which essentially means, you would be willing to sell the coupons for cash for anything above Rs. 1600/- thereby making a neat, tidy profit. I am almost sure this is illegal, but I just wonder!). Also, Sodexo coupons involve a lot of paper. They can shift to card based system (if at all this system has to exist) and save a lot of money (IT firms usually give out cards, but try using a card in any retail chain – nada for now!).

Disclosure: I don’t subscribe to Sodexo coupons. My wife does and hence have a vested interest liquidating the Sodexo vouchers

P.S: I can also see a govt. conspiracy here Sodexo coupons out of circulation means Employees will not subscribe to them January end (or future months). Which means, more taxable income and which means, more taxes. Government #FTW

P.P.S: I explained a scenario above where a Employee can technically make a profit by selling the coupons at a discount. One enterprising person actually tried to sell these coupons at a premium on an internet site. Why would anyone pay hard cash (say, Rs. 105/-) in exchange for Sodexo coupons (worth Rs. 100/-). Beats me. Not too sure what the guy who posted this was thinking though

Wish you all a happy and prosperous New Year!

It is pretty shocking how our minds work, isn’t it? Every January 1^st, it’s almost as if there is a ‘refresh(F5)’ button in our head where we tend to forget all the sad moments of the previous year and look forward to the New Year with all the optimism, gutso, goals and resolutions (it’s just a change of date, created for our convenience, right?). Our brains are wired to look forward to a better future and with much reason – our future has always been better than the past – in terms of quality of living, in terms of technology, in terms of advancements in medicine and in almost everything that you look around you.

As always, on 1^st of January, we are caught in the dance between hindsight and probability – of what could have been in 2011 and what would be possible in 2012.

2011 – A pretty significant year for me. I got married to a fantastic girl (and I’d boil it down to my blind good luck than anything else actually) and she has been an awesome partner (considering all my quirks, I’d pretty much admit it to her almost infinite patience in not slapping me yet). In other news, my career has not gone as I expected in 2011 (except for the last 2 months where there have been some fantastic learnings). If I don’t change tack quickly, there is a great possibility that I get stuck in the average. In yet other news, one close friend C has had a bundle of joy enter her home, another close friend D got married, another shaks moved away due to vagaries of fate. And travel I did this year – I visited one of the most beautiful cities in the world, Sydney (Part 1, Part 2) in the early part of the year (easily one of the highlights of my life), honeymooned in the spectacularly beautiful Mauritius and the awe-inspiring Dubai (whose travel posts I promised about 6 months back but never got to) and roamed around all the heritage tours that Karnataka Holidays threw at us. All in all, it’s been a pretty splendid year, career aside.

2012 – I have had some deep conversations with my closest friends towards the close of the year about my dilemma. Here’s my dilemma – I have done pretty much what I wanted to do by the time I turned 28 – personal life, professional life, travel you name it. I say that not with a hint of pride, but with a lot of regret. I had set some goals at 21 for the next 5-7 years and I have gone on to achieve every one of them. Yet, I made the cardinal mistake of not refreshing/adding to the goals I made up at 21 and hence pretty much stuck now (very foolish, if you ask me). One close friend boiled it down to my innate strength which could also be my biggest weakness:  going by checklists. Yet another friend boiled it down to a mismatch between my ability and my ambitions. Another friend admired my creative ability but admonished me for operationalizing every creative bit, which restricted the range of my goals. It’s been a gut-wrenching exercise of listing down what I want to do for the next 5-7 years (and add on to the list every time one item is checked off) and I am not yet sure I have got a concrete list of to-do things. But I have an idea now. Some goals seem outrageously ambitious but the future looks bright, possible and achievable. So, 2012 is off to a good start.

Other broad goals, which I had already posted on my facebook page (which was in turn copied from my friend’s blog) include,

Walk less, Play more.
Watch less, Read more.
Tweet less, Write more.
Whine less, Do more.
Buy less, Eliminate more.
Plan less, Travel More.
Procrastinate less, Study more.
Indoors less, Outdoors more.
Heart less, Mind more.
Photograph less, Experience more.
Cynic less, Hopeful more.

And with that, I sign off with a favorite T.S.Eliot’s quote of mine,

For last year’s words belong to last year’s language
And next year’s words await another voice
And all shall be well and
All manner of things shall be well.

P.S: For people who are interested in the theory behind the end of Mayan calendar, this link would help you decipher it. Favorite links on movies for 2011 and 2012 follows.

Link to 10 best bollywood films of 2011

Link to 15 worst bollywood films of 2011

Link to 35 most anticipated movies of 2012