Pedap » business

Development and government attitude

peda — Wed, 06 Jul 2011 09:23:28 +0000

In a country, some states develop faster than others. While natural resources could matter, the attitude of the government towards business is also a major factor. If government officials indulge in crony capitalism, in the short term , the individuals involved could become rich and famous, but in the long term the development of the state is affected.
The United States is considered to be the world leader in technology, because it is able to attract the best talent from around the world and also formulate rules which are conducive to the development of technology.

Indigenous technology

peda — Thu, 30 Jun 2011 02:28:16 +0000

In most prosperous countries, government officials go out of their way to promote the development of indigenous technology. They know that by developing a proprietory technology, the nation benefits in the long term as it is source of revenue. For example, the largest refineries in India, license technology from other companies for manufacturing petroproducts.

Big corporations take all possible measures to destroy potential competitors by spreading false rumours. If the decision makers in a country are short sighted and do not verify the facts before believing in these false rumours spread by the foreign companies, they end up destroying their own local businesses and nation as desired by the foreign companies.

Resources and growth

peda — Fri, 24 Jun 2011 13:11:13 +0000

Some countries like Korea, Taiwan and Japan do not have too many natural resources but many of the largest brands in the world have their origins in these countries. This is because the government in particular and society in general values hard work and innovation.
On the other hand, many of the African countries are very rich in natural resources, but the widespread corruption and lack of long term vision by the leadership has resulted in high levels of poverty.

Office supplies

peda — Tue, 17 May 2011 05:49:36 +0000

Office supplies for government offices are usually purchased through tenders, where the supplier with lowest prices gets the order.

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Systems and efficiency

peda — Wed, 27 Apr 2011 00:48:54 +0000

Though there is a misconception that government owned companies are inefficient, it ultimately depends on the systems in place. If an organization does not have proper systems in place and employees are allowed to abuse their discretionary powers, it damages the company in the long run. In certain areas, private sector organizations depends on government agencies for information, so it is important to have sufficient checks in place.

Exemplary or punitive damages

peda — Thu, 17 Mar 2011 13:26:08 +0000

Exemplary or punitive damages is the amount of money the defendant is asked to pay so that it acts as a deterrant so that the defendant and others in a similar position will not repeat the conduct in future.

In some countries, government employees who misuse their position and discretionary powers to harass the public are sometimes asked to pay exemplary or punitive damages.

Work culture

peda — Fri, 04 Feb 2011 13:28:40 +0000

Though the government share holding pattern may be similar in different public sector units, there is a significant difference in the work culture in government organisations even in the same sector. This is mainly related to the background of the company, how it has evolved and the management.

Foreign competition

peda — Wed, 03 Nov 2010 00:10:28 +0000

Most businesses or service providers specialise in one thing - teachers who produce education, or workers who produce products, or shopkeepers who bring up the goods we need. But everybody consumes many things every week – food, clothes, soap, cosmetics, electricity, television programmes and more. Sensibly, we consumers want the most for our money, so we encourage efficiency by purchasing the best products and services at the most affordable prices.

Everytime that government bans an imported good, or slaps a tax on an imported good to make it more expensive, it encourages inefficiency in one sector or another. If we create special taxes for foreign sugar, or foreign cloth, or foreign toys, we make consumers pay more, and make consumers subsidize the inefficiency of domestic companies that are not working as efficiently as they could. If you try that for one commodity, you penalise people who consume that Indian consumers will pay far too much for shoddy goods and the country as a whole will grow poorer and poorer without the improving effect of competition.

Instead, our lagging industries need to learn to compete, and that is not too difficult. Already India’s finished garments and IT services and other products are appreciated the world over for quality, efficiency and competitive costs. Globalisation, in the form of World Trade Organisation reforms, are designed to lower foreign tariffs which were originally designed to protect their own inefficient producers from Indian competition. So markets. Where our productivity is strong, the new global trade rules will let us conquer foreign markets. Where our productivity is weak, we need to invest more, harder, and become more efficient at what we do. Considering that overseas Indians are among the most successful and best-respected business communities the world over, we clearly have the talent to succeed right here at home.

Worker buyouts

peda — Wed, 13 Jan 2010 09:27:17 +0000

Worker buy-outs almost always fail. First of all, workers rarely own or can borrow sufficient money to buy the enterprise, much less to replace antiquated machinery. And they tend to be inexperienced in those areas in which businessmen specialise – borrowing money, issuing shares, insuring their company and marketing their products. Entrepreneurship is an unusual and demanding skill, and most workers – indeed most human beings – do not have that skill. So turning a company over to its workforce is often the cruelest strategy, because then the company dies a slow, lingering death as workers struggle to do something beyond their capabilities.

The same can be said of privatising companies to the current crop of cooperatives. Today these tend to be public sector enterprises, which have most of the shortcomings of other SLPEs. Of course, if cooperatives were converted into Mutually Aided Co-operative Societies and developed a proven track-record of commercial success, then they might well be equipped to rescue a former government-owned company.

Benefits

peda — Fri, 14 Aug 2009 07:22:33 +0000

Privatisation is the best way to resuscitate and rebuild weakened State Level Public Enterprises (SLPEs).

Privatisation :

* Stops loss-making SLPEs from adding to government debt;

* Depoliticises SLPEs, remove governmental pressures for over-manning and the sub-optimal use of resources;

* Gives new owners a strong incentive to turn around failing SLPEs into successful businesses;

* Gives new businesses access to investment capital that government cannot provide;

* Raises more money for government through taxing former SLPEs;

* Expands an enterprise and an industry, in the long run creating more jobs and generating wealth for the country.