Fake Leadership versus Genuine Leadership

Organizations need leaders, genuine leaders and not the fake ones, to attract and retain the right talent. This becomes all the more important in organizations that are started by a few individuals. Such organizations need to hire senior professionals to help grow the organization. These professionals hired from outside can easily determine whether the existing leadership is fake or genuine. Fake leadership as against genuine leadership is evident when the leadership team doesn't walk the talk.
 
Signs of Fake Leadership

Here are some usual signs of fake leadership:

• The top man in the organization, MD or CEO tells the senior professional hired from outside that an initiative must be completed by a certain date no matter what, despite repeating umpteen times that no short-cuts should be taken. The rationale is that challenges are part of any initiative or project and must be managed. And the message is sent across indirectly through an artificially created reporting structure.
• The MD or CEO doesn't allow senior professionals hired from outside to grow in the real sense. These professionals are made to report into the MD or CEO through an artificially created reporting structure.
• The MD or CEO takes arbitrary decision without taking the senior professional hired from outside into confidence. The attempt is to show that the artificially created reporting structure is adding value when in reality that may not be the case at all. This in some way is a justification to legitimize the artificially created reporting structure
• The MD or CEO has pre-conceived and  strong opinions and is not willing to consider differing thoughts. In some ways she would take the decisions on her own and then fake discussions with the senior professional hired from outside to give an air of genuineness to the whole affair.
• The MD or CEO talks about empowerment but doesn't allow true empowerment to the senior professional hired from outside. These professionals don't share the accountability with the artificially created reporting structure if things go wrong but are made to share the successes with the artificially created reporting structure if things go right.
• The MD or CEO talks big about motivation and recognitions but fails to duly appreciate and recognize any big achievement of of senior professionals hired from outside. In fact the success of senior professionals hired from outside is completely diluted by giving a "run of the mill" award to something significant and special. The fake leadership becomes all the more evident when this is done through the artificially created reporting structure.

Handling Fake Leadership for Senior Professionals

The senior professionals hired from outside should not remain long with an organization if they realize the leadership is not genuine but fake and that their growth is artificially contained by the skewed organization structure. Hence the "Importance of Appropriate Reporting Structure". This is generally one major reason "Why New Hires May Quit Early On!"

Is Gurgaon Dwarka Expressway a Bubble Ready to Burst?

After reading about Gurgaon Dwarka Expressway a lot in the newspapers, I decided to explore the Gurgaon Dwarka Expressway area to find out the answers to certain questions in my mind:

• Does it make sense to buy a house in Gurgaon Dwarka Expressway area?
• Is it worth putting one's money in buying a house in Gurgaon Dwarka Expressway area ?
• Are many people really buying houses in the Gurgaon Dwarka Expressway area?

So is Gurgaon Dwarka Expressway a bubble ready to burst? The answer at this point seems to be a big yes. Just read on.

Gurgaon Dwarka Expressway Area

For getting answers to the above questions I spent the last few weeks driving through the new sectors on the Gurgaon side of the Gurgaon Dwarka Expressway area to understand its layout. The whole of Gurgaon Dwarka Expressway area can be divided into five parts:

1. Area close to Delhi (Sector 109, Sector 112) - these are being sold with the USP of close proximity to IGI Airport and Dwarka
2. Area opposite to Palam Vihar on the other side of the Delhi-Rewari railway line (Sector 102, Sector 103) - these are located close to Rajendra Park
3. Area opposite to Sector 9 and 10 (Sector 37C, Sector 37D) - these are close to Basai  area
4. Sectors on the right side of NH8 when going to Jaipur from the Kherki Daula Toll Plaza (Sector 84, Sector 89, Sector 90) - these are running close to the road going towards Pataudi
5. Sectors on the left side of NH8 when going to Jaipur from the Kherki Daula Toll Plaza (Sector 79) - these are towards Faridabad side in close vicinity of Aravalli Hills

Does it Make Sense to Buy a House in Gurgaon Dwarka Expressway Area?

No, not at all given the rates which are currently being quoted. It appears there are no affordable projects in this area. All projects are claiming to be luxurious and the current BSP rates start from Rs 5000/- to 5500/-. For the high-end projects the target market consists of high net worth individuals for whom a few crores here and there doesn't matter hence the contents of this post may not be fully applicable to this segment.

 It would be fair to say that a normal end-user would want to buy at least a 2 BHK. For a 2 BHK of 1500 sqft the basic cost starts from 75 lacs and after considering the additional charges (EDC, IDC, Parking, Club, PLC, etc.) and stamp duty the cost will easily touch 90 Lacs to 1 crore.

Surprisingly there are many builders who have come in to "make hay while the sun shines". I came to know about an inverter manufacturer planning to come up with a housing project. There is a possibility that many of these get some bookings done and sell the project lock, stock and barrel to another builder and there is no guarantee the other builder won't do the same. For end user this may mean inordinate delays.

Is it Worth Putting One's Money in Buying a House in Gurgaon Dwarka Expressway Area?

No, not at all unless you are an end-user who bought it when the BSP was Rs. 2000/- to 3500/- or purely an investor who has put your money when the rates were even lesser and has enough cash to stay in case resale takes its own sweet time. Or handle the worse possibility - to buy and keep the house in case no resale occurs. With this area this is a very real possibility. We know that when demand goes up prices go up but when prices go up many people who could afford an item earlier drop out leading to demand flattening which again brings prices down.

For the salaried class who pay taxes to the government honestly at source itself (through TDS) unless one is earning more than 25 lacs in a year buying a house in the Gurgaon Dwarka Expressway area will be next to impossible. For details see the section "Some thoughts for End Users of Housing Projects".

Are Many People Really Buying Houses in the Gurgaon Dwarka Expressway Area

No, not at all despite the claims made by the builders and even newspapers and many news channels. In the Gurgaon Dwarka Expressway Area mostly investors have put in their money expecting to make a kill when rates go up. It is a fact that prices can't go up indefinitely (other than to account for inflation factor).

Imagine an investor with 1 crore who invests in four houses at a rate of X0. The investor would typically follow the strategy as below:

• Sell the first house when the rate is X1 (>X0) - profit is on the differential X1 - X0
• Sell the second house when the rate is X2 (>X1) - profit is on the differential X2 - X0
• Sell the third house when the rate is X3 (>X2) - profit is on the differential X3 - X0
• Sell the fourth house when the rate is X4 (>X3) - profit is on the differential X4 - X0

The total profit is expected to be X1 + X2 + X3 + X4 - 4X0. This calculation makes a major assumption that the investor is able to make a resale. Also consider the number of people who can afford the house as N0, N1, N2, N3 and N4 when the rates are X0, X1, X2, X3, X4 and X5 respectively.

It is obvious to note that: N4 < N3 < N2 < N1 < N0. Now think what if N1, N2, N3 and N4 are close to zero (meaning there is demand but no affordability in the market - people want homes but can't afford if X0 is very high).

Some thoughts for End Users of Housing Projects

Imagine an end-user who wants to buy a house. It can be assumed that an end-user will come in only at the rate of X1 or higher. Supposing the end-user has 20 lacs in savings so to buy a 1 crore house she will need a loan of  80 lacs under CLP (Contruction Linked Plan). In any case banks don't fund more than 80% of the total cost. For 80 lacs loan at a rate of interest of 11% the EMI for 20 years comes to Rs 82575/-.

Now assuming banks are ready to allow EMI upto 50% of her take home salary. This means the end-user should be earning Rs. 165150/- every month which translates to an annual take home salary of around 20 lacs or annual total salary of 25 lacs. What percentage of end-users come in this income bracket? What about the uncertainty due to weak market conditions? What if after taking loan an end-user suffers a job loss?

So if you are an end-user stay away unless you are prepared for the long haul - spending 1 crore for a 2BHK. The other risk is if the investor can't make a resale the builder won't get the money to carry on with the construction. And even if the builder could, it won't because there is demand but no affordability in the market so no buying would occur until prices crash and that makes the project commercially nonviable.

End-users should also not take the risk of becoming an investor to make a quick kill as this can backfire. I suppose investors will be willing to have their money forfeited by the builder than pay more if the resale doesn't occur by a certain time. An end-user turned investor can't afford to have the money forfeited as their money will be hard-earned unlike the case with investors (who generally have lots of unaccounted money).

Learning from the US Sub-prime Crisis

The US sub-prime crisis had its roots in a situation like the growing bubble in the the Gurgaon Dwarka Expressway area. In the case of the US sub-prime crisis housing loans were provided to those who couldn't really afford them.

Whereas in this case other than projects that were sold when the BSP was Rs. 2000/- to 3500/- most of the projects will stall mid-way  due to defaults by investors (who will stop paying) resulting from lack of end-users (who won't be able to afford the houses). This will naturally lead to inventory pile-up leading to a price crash.

Those who don't want houses, have them (Investors - for them house is a means to make money) and those who want, can't afford them (End-users - for them house is a means to satisfy the basic need of shelter). We all know no one is able to buy something is equivalent to no one wants to buy it and in that case prices do crash.

So is Gurgaon Dwarka Expressway a bubble ready to burst? The answer at this point seems to be a big yes. This is highly unfortunate since many needy end-users finally get adversely impacted.

Online Shopping Experiences

I purchased few items over the Internet in the last one year - cellphone, corded telephone, printer cartridges, baby products, shirt, shoes and accessories. Here are some observations based on my experiences:

• Avoid the not so known, unbranded and unreliable websites
• One of the not so known website I purchased a color cartridge from shipped me a piece where the warranty period was about to get over.
• Another unbranded website I purchased some baby products shipped me an old milk bottle for infants. Also another item was not as per what I thought it would be. The description on the website was not to mark.
• Another unreliable website I purchased shirt, shoes and accessories from shipped me a shoe which was not of the quality claimed by the website.
• Always go with branded websites
• One of the site I purchased a cellphone and corded telephone each was a good experience. The corded telephone size was slightly lesser what I had thought but rest everything was fine.
• Another site I purchased a black cartridge from shipped a fresh piece in perfect condition.

Based on my good experience websites I recommend for online shopping:

• Flipkart
• Ebay

And based on my not so good experience websites I recommend to avoid:

• Nextworld
• Yebhi
• Hushbabies

These are based on my experiences. However, as they say everyone has different experiences and perspectives.

Why is Driving on Indian Roads Risky?

I think one of the hallmarks of good driving is safe driving. Driving on Indian roads, however, is an experience which can be scary. And as one would realize it in no time, it's not safe at all.

Why is driving on Indian roads risky? Based on my experience here are some observations on this:

• Diversity of vehicles on the roads -both slow and fast moving vehicles share the road space leading to chaotic conditions
• Scant respect of lane discipline - drivers change from one to another lane like a "random variable" putting the other road users at grave risk
• Lack of awareness of traffic rules - drivers don't know many traffic rules
• Disregard of traffic rules - drivers don't show any consideration for traffic rules
• Urge to stay ahead of others - drivers carry their egos on the road.

Cash Comes from Competency, Connection and Chance

One of the purpose in life is to become successful. In this materialistic world success is generally seen as equivalent to how much cash comes one's way (this is probably true except for certain professions and certain personalities).

Cash and Competency

Competency is the ability of a person to perform the activities demanded by a profession in such a manner that the person is seen as the "go to guy". Examples include famous cricketers who could do wonders with the bat or the ball or both.

Competency allows a person to be able to leverage an opportunity if it comes the person's way. Without competency a person can get an opportunity but fail to make use of it to become successful.

Cash and Connection

Connection is the network of people a person has been able to cultivate who can in some manner influence the opportunities that come a person's way. Example includes a promising cricketer getting noticed by the selection committee due to a string of stellar performances.

Connection allows a person to be considered by those who matter to notice and provide opportunities to the person. Without connection a person with competency also may not get the opportunity.

Cash and Chance

Chance is the blessing of an invisible hand that makes a person convert an opportunity to one's advantage. This is where the rubber meets the road and cash comes flowing down to the person's pockets. Example includes a cricketer playing a match where other players under-perform.

Chance allows a person to capitalize an opportunity that comes the person's way. Without chance a person with competency and connection may fail to leverage the opportunity.

Cash Comes from Competency, Connection and Chance

The role of competency, connection and chance is pivotal to success in the form of loads of cash. It can be said that cash comes from competency, connection and chance.

The timing of connection and chance is important in ensuring cash does indeed come. For example if someone takes the video of a promising cricketer which is watched by the selection committee after twenty years it will certainly do no good for the person.