The Tangled Web — Part 3

TataIndicom

I live in a development called “Magarpatta City” on the southeastern edge of Pune. Like most other recent real estate developments around the country, it is a gated community. It is far from complete and but most services are available, although choices are limited. One service essential to me is internet connectivity. The only service provider within the complex is VSNL TataIndicom Broadband.

It is “broadband” only if you have a sufficiently flexible definition of broadband. (You know, like “2 + 2 = 5” for sufficiently large values of “2”.) It is actually fairly narrowband. But stuck between a rock and a hard place, you takes what you gets and you pays whatever they demands because they are a local monopoly. The choice is simple: take it or leave it. And that is precisely the attitude that TataIndicom takes around here. The system fails fairly regularly and when you call their customer service, you get no service. Your call ends up at some call center. The impression that I get is that these call centers are staffed with people with subhuman IQ. It is a frustrating experience getting them to actually understand what the problem is. But perhaps it is not their fault entirely. The systems that they rely on are pathetic.

The last few times that I called, I was told that I should take up my complaint with billing. At billing they said that they couldn’t help me because the problem was with the service. My service had been interrupted even though I had pre-paid for it. But they would not be able to figure out why because the records are not available as my service has been suspended. The only way for me is to renew my subscription before they can tell me what was the reason that my previous subscription was suspended.

The Tatas are a reputable company. But doing business with TataIndicom is no different from doing business with a public sector monopoly. Last year, I had been a TataIndicom customer when I lived in a different part of the city. I got fed up with their unacceptable service. Fortunately I had a choice. I switched to AirTel and their service was far superior. I had paid a hefty non-refundable setup charge to TataIndicom which I had to write off as a sunk cost. This time I don’t have the luxury of switching suppliers. It is either TataIndicom or nothing.

TataIndicom has market-power in this situation. Standard economic theory predicts that market-power translates to poor service and high prices. The consumers are trapped in a sellers’ market and lacking choice, put up with whatever the supplier deigns to provide and on terms that the supplier chooses. Given sufficient time, consumers re-calibrate their expectations and poor service is accepted as the norm.

Systems Matter

I have been living in India for nearly four years. The previous couple of decades I spent in California. I had gotten used to a system where the consumer is king and the suppliers did their best to get your business. Service quality complaints (which arose relatively infrequently) were dealt with expeditiously and in many cases reasonable compensation was promptly given for the inconvenience caused. The interesting point is that in practically all cases, the calls were handled by call centers in India. There’s a lesson in there. It is not the people but the systems that dictate what the outcome is.

The systems in place to deal with service issues in the US are superior to those in India. When you place a person in the system, irrespective of whether the person is Indian or Croatian, he or she performs as the system allows and/or mandates. An Indian within an American system would be no different from an American in an American system. Conversely, an American in an Indian system will be indistinguishable from an Indian in an Indian system.

Why do Indians born and brought up in India when they arrive in the US just happen to be remarkably successful? There is the matter of selection bias of course. Those Indians who get to the US are more educated, more driven, and more talented than the average Indian (or the average American, for that matter.) Even if you control for that bias, there is a residual degree of above average success among Indians in the US relative to Indians back in India. My conjecture is that the American systems are superior to the Indian systems and that accounts for the difference.

That raises the question: surely, the American system was not designed by god almighty. That Americans designed good systems and Indians did not must speak to the superior system building skills of the Americans compared to the Indians. So in a sense it is not sufficient to just say that Indians and Americans are inherently equally capable, and that the Americans are more successful than Indians because they have better systems. You have to also explain why Americans could build better systems.

Abhi Rulz

I have a tentative answer. Let me tell you a story. One evening I was visiting with my friends Sudha and Vijay, and their two kids Anu and Ahbi, in Rancho Palos Verdes in southern California some years ago. We were watching a video when Abhi, then three years old, had to take a bathroom break. He was promised that we would pause the video while he went and did his business. When he got back, he realized that we had not “paused” the video but had instead stopped it. He was furious. “Paused! Paused!” he yelled. He was hopping mad. He said that the rule was you have to “paused” the video, not stop it. It took a while for us but we all accepted that we had messed up and it won’t happen again. He was placated.

He was in a phase where you could resolve any dispute between him and his older sister, or get him to do something, by merely invoking the appropriate rule. You had to tell him, “Abhi, the rule says such and such . . .” and he was willing to go along with it because that was what the rule said. He was not sufficiently sophisticated to challenge the source of the rule or why it was a reasonable rule. To him, a rule was a rule and it had the force of law and everyone had to abide by it.

I still cannot think of how important rules are without recalling with a great deal of sweet nostalgia that incident of Abhi absolutely insistent that we had broken the rule that we had agreed to. I think rules are important and if you agree to a reasonable set of rules, you can actually build wonderful systems. Let me get to that the next time.



Categories: Tangled Web

18 replies

  1. Atanu,

    Nice roundup and comparision between the systems in India and California. I live in CA and yearn to return to India for good. But the failure in systems – Do we have to live with it or, we can fight it. Atleast blogging in a community is a way of fighting. What else can be done?

    Nissi

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  2. Atanu,

    I fail to understand why other broadband ISPs are not available in a town like Pune.Its a monopoly and the consequences are for all to bear. I am also at Pune and there are none, not even Tatas, available at my locality. Amazing, yet true.

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  3. Check out ‘The Fifth Discipline’ by Peter Senge – excellent book on Systems Thinking… if i may summarize the fundamental point: you can’t fight the system because it just doesn’t allow you to. Systemic problems cannot be addressed by reactionary fixes, but only by systemic solutions. And in order to define systemic solutions, you need to think ‘systemically’. Since this is a blog by an economist about India’s development, I am tempted to ask how come the modern economic thought considers the natural environment as merely an input for production, in other words the economy as the “system” with the natural environment as a subset? BTW, No, I’m not the ‘save the earth’ type.

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  4. Always this India versus America comparison. Ok, no quarrel with that. But since author has also been to Europe, Latin America, Africa, Australia etc. sometimes you can tell us about those places also it will be more interesting. What do they do about internet in Sudan or Norway or Brazil etc. ?

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  5. Beautiful post, Atanu… and really thought-provoking. I am still struggling to understand that the rule or the law is there to be taken in its spirit, and not its letter. “He was not sufficiently sophisticated to challenge the source of the rule or why it was a reasonable rule. To him, a rule was a rule and it had the force of law and everyone had to abide by it.” — very well put! I will be looking forward to the follow up on this!

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  6. You are right it is the system which is the main problem.Recently I had the problem with Sony Ericsson phone.The authorised centre of Sony just disowned the phone (Despite my willingness to pay for the service ) and told me nothing can be done.It is just 3 months out of the warranty and hence i raised the issue.Not only they were not ready to help but quite rude.This post sales behaviour is unlikely from Sony in US.

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  7. Inderjeet, i’ll take a shot at your question. (Hope we are not deviating too much from the discussion. Since we are talking about “systems” this is probably appropriate)..

    “Since this is a blog by an economist about India’s development, I am tempted to ask how come the modern economic thought considers the natural environment as merely an input for production, in other words the economy as the “system” with the natural environment as a subset?”

    Natural environment system is obviously a superset of Human economic system. So, for human economic system to be sustainable in the long run, it should operate by the rules of the super-system. Our current human economy is acting to the contrary. I think you agree with me upto this point.

    Now, Modern economic thought (by which i take you mean, the free market system), per se, does not consider “natural environment as merely an input”. It simply says that if the prices of goods & service in the market be completely determined according to supply – demand dynamics, then it leads to efficient allocation of resources. The “natural environment” provides services worth trillions of dollars to our human economy. The problem is that the natural environment cannot speak and does not demand money for the services it provides. So, it is upto the human society to *place* appropriate value on the natural environment and the run the human economy based on that pricing. The whole problem is, the humans are not doing that. For example, we are pricing crude-oil just for extraction costs, refining costs, plus some profits. The price of disruption of climate-service is not included. We are pricing the paper for cost of cutting a tree, transportation costs, etc. The price of carbon-sink-service, and other ecosystem services that a tree provides is not included. These are just couple of examples. So, it is upto the humans to assign value to ecological services, and incorporate in the pricing. So, i believe the solution to environment problem lies not in fixing economic systems, but in humans making conscious choices and incorporating them in existing system.

    btw, no need to be apologetic about being “save the earth types”. You are welcome to the club. It just means that one is using one’s head and seeing the larger rules operating in the world. Rules that human economy must live by.

    Regards

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  8. I have to clarify that iam no fan of viewing nature strictly from utilitarian perspective (i.e, the value of “services” nature provides to humans). Everything has it’s own inherent beauty and value, beyond use to humans. However, even from a strictly utilitarian and practical point of view, the current human economy is the height of stupidity.

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  9. Question: How much of economics is a result of kin altruism, colony organism reflex and hence sort of hard coded in the genes ? Is there a unified economic-social studies theory ?

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  10. Great read.. Liked what you said about “Systems matter”. May be I diverge from the topic, but, would love to hear your comments on ‘Sense and sensibility, Etiquette of Indians in US and elsewhere and India’.

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  11. Is there a consumer protection forum (similar to BBB – Better Business Bureau in US) in Pune? Maybe they can address your complaints about TataIndicom. If not why isn’t such a forum in place? This could be a good news story for a local TV channel. Maybe then something will come out of it.

    With the recent spurt of news channels, I think its up to each of us to utilize these to improve the conditions around us. Let us leverage the powerful forces that they are.

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  12. Atanu,

    I’m staying in Kharadi, and I know exactly how you feel. Though I’ve heard BSNL is coming here, I don’t know how long will it take.

    Anyways, here’s a tip. Ask the call center to send the engineer to your place. After you ask them about ten times they will finally send one guy to your place. Now that is your chance!!

    Ask a couple of friends to come home when this guy comes. Lock the door, and tell him to he has to stay there till the problem is reproduced and fixed again. Make him stay for at least eleven in the night before you let him go.

    And yes, ask him to make all calls from your cellphone, so that the next time you know who to call.

    And suppose nobody comes to your place after you have tried a number of times, go to their office on the first floor in MegaCenter, and bring one guy along with you.

    I guess you get the idea. It worked well for me, and should work for you too…

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  13. I live about 6 kms from your place off fatima nagar (near Vishal Megamart). I agree with you about their service. So long as it works, it works fine(I had almost a 6 months zero-downtime service from Tata Indicom so far). But, once it goes down, the call center folks irritate me like anything. You are talking to somebody who is not accountable for anything. All that s/he talks is crap and at the end simply files a complaint which will take 2 days to even look at.

    @chaitanya:
    I agree with you. Time is not still ripe, as most economists don’t give a thought to it or still think that all this green talk is hokum.

    -Mike

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  14. @Indian:
    no, you cannot use all these news channels for this. Because this does not qualify as a breaking news and the ad makers are not going to pay for it. (only “Amitab Bachan is not buying addidas anymore” likes qualify).

    @Sudhanshu
    I find that the amount of effort put in from our side in getting a complaint forward is not generally recorded in this call centre systems. At first Mr.Abraham will answer, the second day Miss.Tina and the third day Mrs.Sujatha. If you are talking to one person, you can reasonably assume that s/he can understand your frustrations when you shout at them. But everytime an alien answers your call, it just does not make sense to shout or crib.

    -Mike

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  15. Systems thinking, you rightly pointed out how people behave according to the system. Its not just for countries, pretty much applies to all systems. Put an individual entity and they start behaving like the system.

    To answer your question about how great systems are made in the first place, the system itself sees to it that such things take place.
    Did we not have a Gandhi, a Dhirubhai Ambani, a NRN who were a part of the system but changed it for once and all. The thing we have to realize is it’s the individual entity who knows that he’s in a system and it takes time to change the system, can change the system. A knee jerk or a temporary solution cannot move a system from its state of inertia, it will try to come to the same state.

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  16. Systems do matter….

    W. Edwards Demming (The Quality Control Super Guru) has said that 80% of the quality problems are the result of the poor systems designed by management in which workers work and 20% of problems are due to workers’ own faults.

    When Indians come to the US, they automatically undergo transformation or adaptation to learn the American System (enculturization)and behave in ways they would not dream of behaving in India under the Indian System.
    However, there are still certain Indian systems that I prefer to the American System, namely in matters of family, education, respect and care for elders, and societal restraints on individual norms in matters of dress, modesty, etc.

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