If we divide jobs into technical and generalist jobs, engineers, doctors, educationists, agriculturists and scientists would fall in the first category while managers and administrators would come under the second
By Arvind Saxena
You can fool some of the people all the time, and all the people some of the time, but you cannot fool all of the people all of the time.
–– Abraham Lincoln
For the last several years I have been writing about how our skewed remuneration structure is disincentivising the study of pure sciences, mathematics, technology and medicine amongst our best youngsters.It is natural for young men and women to veer towards careers where they will earn the best salaries.We therefore see an increasing number of bright youngsters, who graduate from technical and medical institutes, go in for an MBA to better their earning potential.So, what do these technically qualified youngsters learn at business schools, which they have not been able to learn till their graduation?
After five years of engineering studies, I also joined an MTech program in Systems Management.This was an MBA program for engineers, designed after the Harvard Business School model, with added inputs of Operations Research, Systems Modelling, Project Management and Computer applications.It was an interesting program with a lot of case studies, discussions and presentation of reports.Corporate Social Responsibility and Ethics was one of the subjects, as a part of which we had to write a long paper on Business Ethics.I decided to write on ‘Ethics in Advertising’.
I had recently picked up a book by Vance Packard from a roadside seller.The ‘Hidden Persuaders’ dealt with subjects like subliminal messaging and how advertisers, instead of projecting the qualities and worth of their products, were trying to play on the fears, anxieties, poor self-worth of the consumer and their need for keeping up with the Joneses, to pitch their products through human gullibility.I thought this was unethical because we had been told that in the true spirit of laissez-faire and a perfectly competitive market, you needed to build a more effective rat trap if you wanted to beat the competition.
So, my long paper dealt with these issues and raised the spectre that if we did not stop these unfair practices, we would soon see a day when advertisers would try to defeat common sense, good education and rational behaviour with attempts to manipulate the minds of the consumer and sell worthless items, creating needs where none existed.A day would also come when a seller would knock you down with a whack on the head, or drug you, or blunt your rationality and, in a semiconscious state, make you sign the sale deed!We now see this happening all around us.Our minds are numbed by false claims of ‘super efficiency’.No Sir, super efficiency is a chimera – it is a con.
Just as Value Engineering taught us that the importance of aesthetics has to be kept in mind, and a paper clip cannot replace a tie pin, societal needs cannot be discarded at the altar of the efficiency being promised by the endless supply of Apps being pushed down our throats.These Apps monitor all your habits and evaluate your vulnerabilities which, fed into sophisticated algorithms, reinforce prejudices and lead you into directions of behaviour without your realising that you have lost control of the stick and rudder.The scary part is that, with our minds taken over by these unscrupulous professional manipulators, we are demanding more and more of the junk – whether it is technology, food, entertainment or social media.
Going back to my long paper on Business Ethics, Prof Nader who taught the subject evaluated it at a high score of nine upon ten.As part of corporate policy, we knew the concepts of insider trading, creative writing of accounts and balance sheets, booking profits at opportune times, etc. Many of our guest faculty were notable gentlemen from the corporate world, both professional managers and promoters, who showed us how to bend regulations and work around the laws and rules of the country to maximize their profits.
Fortunately, non performing assets (NPAs) and their creative use, and influencing government policy through politicians, were still not standard business strategy, or were considered too sensitive to be discussed with greenhorn management students.Seeing the business acumen and value systems of these top corporate honchos. I had no doubt that most of them would have evaluated my ethics paper at a comprehensive zero!So, I decided it was best I stay away from the idea of working for the business world.I chose another career path.
The nation’s wealth
Several years later, talking to a graduating class at an IIM convocation function, I stated that while – “we all know that business enterprises exist to maximise profits for the promoters, investors and the shareholders, we always forget one stakeholder.In addition to finance and human resources every enterprise also needs natural resources i.e., land, minerals, forest produce, water, air, wave length, etc. These natural resources are the nation’s wealth – they belong equally to each and every citizen of this country – each and every one from the richest to the poorest – and equally!
“The common man entrusts these resources to his elected representatives, who are expected to invest them to maximise the returns for him, through use by private and public enterprise.Therefore, as professional managers while you must give your best to maximise your company’s profits, you should not forget your obligation to the common man, the forgotten, faceless stakeholder, who is the owner of the resources you are using to generate those profits.
“You have to take only an equitable proportion out of the profits, even as you plough back remaining profits into the company or give out to society.In doing so, you are actually doing a good turn to yourself. Industry can grow only when you increase the purchasing power of more and more people.This can only happen by generating employment, giving fair wages and ensuring equitable distribution of the corporate profits.”
I told them that, having studied at a prestigious IIM, they were obviously intelligent, motivated and socially responsible youngsters, who should vow not to become compliant professionals.“Your pay and perks should not lull you into accepting the status quo.Do not create false needs and desires amongst gullible people – which will eventually include your own children someday.Look upon yourselves as leaders who will help society discern between real needs and artificially created needs.Remain committed that your work should not lead to exploitation of human, financial or natural resources.From your position of leadership, send out a subtle but firm message that you stand for the larger public interest.The claim that someone is wealthy because he works harder and is smarter is a false narrative.There is no justification for ostentatious living and profiteering.”
In subsequent interactions with several directors and senior professors of leading management schools I have asked a simple question.”When a graduate engineer from our leading technology institutes like the IITs steps into the job market after four years she can, on an average, expect a pay package of around Rs 600,000 to Rs 1million, but after going through a two-year MBA program at an IIM the same youngster can command a package of up to Rs 5 million per annum or even more.My question is what do you teach them in two years that their market worth is multiplied five-fold and again why can’t the BTech program be extended by a year and the MBA education be packed into all standard engineering curriculum?”I have never received a convincing response, frankly because there is none.
Anomaly in remuneration policy
In writing this article, my intent is not to demean the value of business schools, I only wish to highlight the huge anomaly in our remuneration policy which is destroying the real physical economy, where people work with hands and machines to produce tangible goods.If we divide all jobs into technical jobs and generalist jobs, the engineers, doctors, educationists, agriculturists, scientists, etc., would fall in the first category while managers and administrators would come under the second.Professionals under the first category form the foundation of a developing economy.The second category is to service the activity of the first.There is no role, or need, for the service sector unless we have robust and dynamic physical economic activity in the country.Once we accept this, the remuneration systems strike you as blatantly upside-down.Better salaries in the services sector – banking, finance, IT, accounting, etc., – are absolutely contra-intuitive.
Unless we set this right, we will keep on seeing engineers and doctors doing MBA and joining the civil services or taking up managerial jobs in marketing, finance and HR, etc., in the corporate world.The service sector can continue to do what it does best, including its role in administration and coordination, but the nation should attract the best young talent to the core physical economic activity.The best students should find the motivation to study the sciences and maths and be placed at the top of the wages pyramid.Why are we not able to do this?We need to find an answer urgently.
Arvind Saxena, former Chairman of the Indian Union Public Service Commission
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