Hyderabad - A Biography : By Narendra Luther

Not being a born Hyderabadi, I had read quite a few books to know about the city of my current domicile. Of these,  “Hyderabad – A Biography “ by Narendra Luther is my most favourite. This book gives a detailed account of the period prior to city’s birth in 1591, and then presents an unbroken chronicle of it till the current age. From Bhagnagar, to Hyderabad to Cyberabad  everything is covered in it in perfect detail. It combines the popular history with research based historiography in a very engrossing manner. Oral history, interviews, recordings of eminent personalities have been very aptly used.

The Qutb Shahi Dynasty starting with Sultan Quli, Qtub-ul-Mulk and ending with Abul Hasan Tana Shah ruled here from 1518 to 1699, over eight Sultans. Then from 1720 to 1948 ten different  rulers  of Ashaf Jah dynasty rule over the area ( seven of them were titled Nizam for technical reasons ), culminating into its merger with independent India in 1948. 

Hyderabad is the daughter of Golconda Fort, which stands in ruin now, eight kilometers away from the center of the city. The fort was built about thousand years ago, during the Kakatiya rule. Rudramba Devi, the queen of Kakatyiya ruled for thirty four years from 1262 to 1296.. His grand son another courageous ruler, continued ruling till 1323, whereafter he was defeated by Ulugh Khan ( later known as Mohammad Bin Tughlaq ) and was imprisoned and taken to Delhi. This maverick ruler shifted the capital of Indian empire from Delhi to Devagiri in the south, which was later renamed Daulatabad. In 1346 in violation of the Tughlaq rule, the locals choose a leader called ” Zafar” as their king, who founded the Bahmani dynasty and ruled the area from 1347 to 1518, first from Gulbarga and then from Bidar. During the rule of Mohammad III, Sultan Quali, the son of a fugitive chieftain from Hamadan across the river Oxmania, up the north-west of Afganisthan, entered the service of Bahamani rulers and ultimately became the governor of Tilang province, which was controlled from the Golkonda fort. He had the ultimate power on Golkonda and vicinity after the death of Mohammad III. Sultan Quali, the first ruler of Qutb Shahi Dynasty started expanding his empire from the Golkonda  in 1518, from where this book really starts. 

Ibraihim the 4^th ruler of the Qutb Shahi dynasty of Golkonda , in a confederation arrangement with the sultans of Ahmednagar, Bijapur and Bidar waged battle against Ram Raja the ruler of Vijayanagar and defeated and finished him. Muhammad Quli Qutb Shah, the next Sultan loved and married a Hindu common girl called Bhagmati and her village and adjoining areas were converted into a township at Sultan’s order and was called Bhagnagar, the predecessor of Hyderabad. Char Minar was also built inside this township. Master civil engineers and craftsmen were brought from Iran. After Bhagmati died leaving a girl child Hyder Bakshi, the courtiers of  the Sultan could convince him to change the name of the city from Bhagnagar to Hyderabad, and thus  Hyderabad was born.

The City of Hyderabad was praised very liberally by the then Indian and foreign travelers to the city. Particularly the French Travellers Tavernier and  Thevenot were all praise for the magnificence of the city. It comes out in that age and time the Sultans used to have European physicians for their health care at Hyderabad.

After passage of time and generations, the  rule came to the hand of Tana Shah, the last Sultan of the Qutb Shahi Dynasty in 1672. Tana Shah was very liberal, poetic minded, merciful  and it is told that he was instrumental in resurrection of Kuchipuddi form of dance, which in those days were practiced by Brahmin boys, and girls were prohibited. He made many tactical mistakes and  somehow earned enmity from the Mogul emperor at Delhi. One of the reasons could be his hobnobbing with Shivaji,, the Marathi King Shivaji and his clan at the behest of his Prime Minister Madanna.  Ultimately he had to sign a humiliating treaty with the Moguls and sacrifice the life of his Hindu Prime Minister Madanna, But emperor Aurangjeeb was not happy with the treaty and he personally came to Golconda to lay a siege of the place in January 1687. Even after many months of siege no advance could be made by the Moguls. They had debacle after debacle. Their many plans failed. But Tana Shah had accepted a defeat mentally and made again many mistakes. Ultimately with the help of bribes Moguls  were able to open the gate of the Golconda fort and enter there. He was finally arrested and taken to Daulatabad to spend rest 13 years of his life in Jail.

There were some turmoil after the death of Aurangjeeb and finally in 1720 the first Nijam was appointed to rule Hyderabad at the behest of the Emperor in in Delhi. Hyderabad remained a rich place and the 10^th ruler Mir Osman Ali Khan ( but called 7^th Nizam  because of some title issue of a few of his predecessors)  although a miserly person, was supposed to be one of the richest persons of the world. First under the Moguls and then under the British, the Nizams of Hyderabad had some semi-independent, loosely subjected status. The British used to keep Residency Officers in Hyderabad to oversee their interest, but in matters of administration Nizams enjoyed a good deal of freedom. In Hyderabad land revenue was less than British India and income tax was non-existent. But there was an interesting system of Nazar for the Nizam.

Invitation were sent to nobels and officials on Id and birthdays, People invited were expected to meet the Nizam with some coins and gold coins. Registers were kept to see that everyone has attended. The Nizam would keep the gold coins in one bag and the other coins in another bag. The Nizam would even send Khasa, the part of royal meal to the nobles, who are supposed to come back with nazars to the Nizam shortly. Fruits would be sold from the Nizam’s personal gardens to the nobles, who would have to pay hefty price for the same, say Rs 24/- for a mango, even in those days. Whatever, the Nizam woild like would have to be offered as nazar. The Falaknama palace, was also presented as a nazar to the 6^th Nizam  and so was the King Kothi to 7^th Nizam. There is story in the book how the Nizams took some costly books to read and they were never returned.

In June 1947, when the shape of the political future of India became known, the Nizam declared that he would join neither India , nor Pakistan, but would assume independence, which was an untenable position for a landlock state with very little defense strength. The following years saw lot of communal tension in the city and the state and the infamous razakars took root in the city, to help the Nizam achieving his dreams.  In December 1947, Razvi imposed a new government on Nizam and Mir Laik Ali was appointed the Prime Minister.  The atrocities of the razakars increased and resistance from a section of the right minded enlightened Muslims against the razakars also increased simultaneously. Shoebullah Khan fell a martyr to the cause of communal amity. Other persons offering resistance to the razakars, Akbar Ali Khan, Mehdi Ali and Fareed Mirza however survived. There was blood in the streets of the city.

At one count around this time Nizam had 42 wives  and a force of 31660 persons, of these about 17000 numbers were in Subsidiary Force and Hyderabad Contingent, which were under British control. 

Finally the Indian Army took control over Hyderabad headed by General Choudhury, the commander for the Nizam’s Army was General  El Edroos. It was a short one sided battle with not much bloodshed. On 7^th March, 1950, the City wok up to a sensational story that Laik Ali, the last Prime Minister of  Nizam VII kept under house arrest, has been able to reach Pakistan. In the mean time the new constitution of India was promulgated, The full bench of the High Court in August 11, 1950 gave a decision that the detention of Laik Ali was repugnant to the Article 22 of the Constitution of India beyond January 26, 1950, and hence anyone helping him to escape was not culpable. Razvi the field marshals of the razakars, was charged in several cases including the murder of Shoebullah Khan. However, only one case of Bibinagar dacoity could legally survive and he was put in the Chanchalguda Jail in Hyderabad and later to Yervada Jail in Pune. He was released from jail in September 1957 , he came to Hyderabad, nominated Abdul Wahid Owaisi, as the head of Ittehad, am organization formed by him,  and left for Pakistan. In Pakistan Razvi started his law practice amongst the refugees from India. He died in Pakistan in 1970, and in the same year Laik  Ali also dies in New York.

On 6^th March, 1952 the first elected government was sworn in with oath of office being administered by the Nizam. The government was headed by Mr. Burgula Ramkrishna Rao of  Mehboobnagar district.  He was the Chief Minister of Hyderabad. 

After him there were twenty Chief Minister of Andhra Pradesh ( the language based state formed later), of which eleven times the title of the Chief Minister was “Reddy” and five times it was “Rao”. Two of the Chief Ministers of Andhra Pradesh, Neelam Sanjeeva Reddy and P V Narasimha Rao later on held the position of  President of India and Prime Minister of India respectively at different times. The longest serving Chief Minister of Andhra Pradesh was Nara Chandrababu Naidu.

As proposed by Congress, policy since 1920, Andhra Pradesh was created on the basis of “one language one state” On October 1, 1953, Andhra Pradesh was formed comprising of eleven Telugu speaking districts of the erstwhile Madras state. ( Madras state was later renamed as Tamilnadu). Hyderabad was trifurcated, and the Telugu speaking districts were merged with the new state.The cultural difference between the areas of costal Andhra and those in the direct vicinity of Nizam’s rules were different and so were their attitude to life. These people, loosely called  themselves as from Telengana, till date feel that they have been given a raw deal and all the riches, even jobs,  of Hyderabad and Telengana region have been wrongfully appropriated to the people from other regions of Andhra Pradesh, they want two states, or three states, though  speaking the same Telugu language.

During his later years with the help of his Financial Advisors and lawyers Nizam made several trusts with monetary endowment from his side for the well being of the people who were related to him or who lived in the King Kothi with him, and he provided reasonable to good amount for everyone of them. In last few years Nizam had reduced the nazrana amount to between five to eleven rupees. Someone presented him a gold coin during that time, and he said curtly “ You think I am poor?”. Then he placed his hand on the coin and said “I have accepted it, now you can take it back”.

These chronicle and much more are in this book, which is a must read for everyone who loves Hyderabad.

Cold Steel : Lakshmi Mittal and the Multi-Billion Dollar Battle for a Global Empire

“ Cold Steel ” is written by Tim Bouquet and  Byron Ousey. The later was advising the Luxembourg Government on their communication strategy  during the period covered by the book. As the name suggests,  the book is about Shri Lakshmi Mittal and the multi-billion dollar battle for a global empire. The book written like a fiction, puts together a compelling story on struggle for market domination between the two of the world’s largest producer of steel,  i.e. Arcelor  and Mittal Steel. 

Since during this time,  I was working  at  the Polish entity of Mittal Steel, I had a ring side view, but not in as much detail as is given in this book. Some of the  characters in the book are known to me, but that is besides the story. As is well known ultimately the controlling interest of  Arcelor was bought over by the Mittals and  Arcelor-Mittal became the largest steel company of the world. Subsequently, I worked at the combined head-quarter of Arcelor Mittal at Luxembourg too. 

The then CEO of Arcelor, Guy Dolle has been painted as a principled person, an expert in production of steel, not as good in public relation. On the other hand Shri LN Mittal and his son Shri Aditya Mittal are portrayed as master strategists, who traveled the entire world, met all the stake holders, had numerous meeting and made numerous presentations. They are master financial and PR strategists also and had no dogmatic approach on any matter always ready to accommodate.. The billion dollar savings because of the synergy  of  merging the operations of Arcelor with Mittal Steel and the complimentary nature of their product baskets made logical sense at that time to many shareholders. Use of Russian Servostal  as a poison pill from Arcelor’s side did not go well with the shareholders, it seems. Two highly internationally renowned investment bankers and brothers Yeol Zaoui ( Goldman Sachs) Michael Zaoui ( Morgan Stanley ) were in  opposite camps.As brothers they were very close, speaking to each other most of the days, and dining their mother once a week. They would be holidaying together, but when they were working on opposite sides they were strictly professional. The writers want us to believe, that there was one thing they never spoke out to one another is the deal.

After the acquisition, in 2007 Arcelor Mittal had grown to a company, with market capitalization of $ 128 billion, producing 116 million tons of steel generating a revenue of $ 105 billion. Its EBITDA was $19.4 billion  and net income of $ 10.4. Almost all the savings because of synergy promised by the Mittals were also achieved.

The political class of France, Germany. Luxembourg, India had played their respective roles and that is also well captured in the book. The names and roles of some of the executives on both sides are also well captured in the book. A battery of lawyers, investment bankers, PR firms were engaged by both the sides, and their names and roles also detailed as a part of the drama,

Prologue

However as Guy Dolle had put, the final outcome and success of this merger is yet to be pronounced. Because of the high Chinese demand and high steel price Arcelor Mittal made extra-ordinary profit in 2007 and a few months of 2008, which gradually came down over years. The turmoil after Lehman Brothers' collapse and the subsequent recession-like situation added woes to the steel industry.  Mr. Mittal lost many slots  in his ranking in the list of Forbes’ wealthiest persons.  The fall can be easily understood from the share price of Arcelor Mittal. Its shares were quoted at $103.1 as on June 2, 2008 and  on November 12, 2012, it is quoted at $ 14.85, a fall of 85% from the highest price.  Many of the subsequent expansion plans are on hold and Mr. Mittal’s dream of transforming Arcelor Mittal into a 200 million ton steel is still a distant vision. With profit margin of -0.85%, return on equity of – 1.29%, and book value of $ 35.58 , its shares are quoting on Nov 12, 2012, at 41% of book value, in short it is a disaster as of now. Only posterity will tell whether the acquisition  made any sense.

Whether the merger has worked or not, world steel production has gone up or not, steel quality has improved or not, many people in the game, the shareholders, investment bankers, and an array of advisers  have made huge money, and  even the employees, who unloaded their stock options at a huge profit. 

This  is an engrossing  story of modern day  mega-capitalism.

Extreme Money – The Masters of Universe and the Cult of Risk

“Extreme Money – The Masters of Universe and the Cult of Risk “ by Satyajit Das is a book on the present day bankers. After reading this book, you would feel tempted to withdraw all your savings from the bank, or plan to be as mischievous as possible  with your bank and be a part of the robbery that  is possibly going on even now.

 Though mostly focused on US and European Banks, I think, some Indian Bankers are also waiting in the wings for such an opportunity  to emerge. The Salary of the top level of executives in many Indian banks are also sky-rocketing and it is only possible that they are just waiting to catch up with their friends abroad, who are simply mastermind burglars.

I have attended the class of Mr. Das, when he was in India as a part of Euromoney Traning’s training program on  derivatives. His understanding on the subject and mastery over financial modeling was very appreciated by his enlightened class. But this book, shows much  more than his mastery over the subject, it shows his understanding of the entire world of rogue banking. Most of the rogue bankers got scot free, except a  few in the periphery.

“The analysis shows the dizziness of spiral debt. Borrowing by US Government, corporations and individuals have reached around 350% of what America produces in a year, its GDP. Consumers borrowing at a record level, every man woman and child in the USA ( a supposedly rich country), has borrowed around Rs 4000 dollar each from their Chinese counterparts ( who are supposedly less well off ). Complex, incomprehensible, untested financial products have accumulated unnoticed, outside regulatory perview. Banks are lending money to people, who will never be able to pay them back. “

In every line and every page of the book there is insight of an insider, who reveals the real truth of high end banking, particularly investment banking.

 While reading the book you will discover what pleases these bankers, their habits and wealth, who toil hard to make their own money and not for their customers and investors. They always believed that they are so complex that no one will understand them, no regulatory mechanism can touch them and  they will go on creating this unending web of risk management theories and draw every one into their greed lock.

Sample this :

" Crime without Punishment : In 2008 hedge fund returns averaged negative 20% Even marque funds took large losses. Hedge Funds investments fell by around $ 600 billion. Over 3500 hedge funds out of 8000 ceased operation. Devaney a hedge fund manager and bon vivant with a taste for high living, lost $100 million, and was forced to sell prized personal assets, properties in Aspen, Colorado and Miami, his helicopter, a Gulfstream jet and his cherished 142 foot yatch 'Positive Carry'. "

" The brave new economy was built  on debt. Individuals borrowed to buy houses, cars, gadgets or take holidays.  They borrowed to get education, and to get healthcare. They even borrowed to save, using debt-financed investments. Companies borrowed to invest and to buy each other. They borrowed to pay dividend, repurchase their own stock. ...America borrowed in good times, because it could and borrowed n bad times because it needed to. Vice President Dick Cheney stated " Reagan proved deficits don't matter".

The sheer magnitude of neglect revealed in this book, will make you boil inside you and  you will feel like doing something about these white collar robbers.  This is also an eye opener for you, why should you keep your money in gold and other real assets, and not in bank accounts totally , however, allured you are. The housing bubble has also to be watched against, although India probably has not reached that stage as yet.

The domino effect of this rogue banking is what we are seeing everywhere, particularly Europe, who have been half-heartedly drawn into this circus.

This book is worth reading from cover to cover and should find a permanent place in your almanac.

The Pregnant King : by Devdutt Pattanaik

Yuvanashva  was a childless king, who accidentally drank a magic potion meant to make his queen pregnant  and gave birth to a son. The novel is based on his story. It also has stories about Somavat, who surrendered his masculinity to become a wife, about Shikhandi, a daughter brought up as a son, about Arjuna, who was forced to masquerade as a woman, after being cursed by a nymph, about Ileshwara, a god on full-moon days and a goddess on a full-moon night, and about Adi-natha, the teacher of teachers, who is worshipped as a hermit by some and as an enchantress by some others.

The book plays in the twilight zone between masculinity and femininity and inter-sexuality. In those days and age whether all the knowledge of X and Y Chromosome was known or not, is not clear. But definitely the concepts existed, and the characters in our epics are reflection of an eternal reality, although may be in a little dramatic or exaggerated manner.  Intersexuality as a term was adopted by medicine during the 20th century, and applied to human beings whose biological sex cannot be classified as clearly male or female. Some people (whether physically intersex or not) do not identify themselves as either exclusively female or exclusively male. Androgyny is sometimes used to refer to those without gender-specific physical sexual characteristics or sexual orientation or gender identity, or some combination of these; such people can be physically and psychologically anywhere between the two sexes. Among humans, some men have two Xs and a Y ("XXY",  Klinefelter's syndrome), or one X and two Ys (XYY syndrome), and some women have three Xs or a single X instead of a double X ("X0", Turner syndrome). There are other exceptions in which SRY is damaged (leading to an XY female), or copied to the X (leading to an XX male).

To bring all the above characters together, the author has created some deliberate distortions in the story and also back-dated or front-dated some of the narratives. But it contains lot of wisdom, eternal wisdom retold along with the myth. In the words of the author “ The book is full of hymns, chants, rituals, sells, speculations, philosophies and ancient codes of conduct. These must not be taken as authentic as my intention is not to recreate reality, but to represent the thought process,

“ You have to see a man’s eye through a woman’s body. Then you will see a different truth. A truth that a few men are prepared to acknowledge. Take away dharma and the man is a beast.”

“Was is so terrible to be a woman?”

“No, it is terrible to appear as a woman and still have a man’s heart."

“ Liberating actually. I could get away with anything, I could cry dance and sing as I pleased. I had to answer no woman or man. I was no one’s husband or wife. But still Kama did not leave me in peace.”

“ I loved the little girl and could have made her my wife,but she looked upon me as a teacher, mother, friend, protector and parent. My year as an enunch had made me actually aware of the dark thoughts of men. I refused to marry her, I made her my daughter-in-law.”

“ Krishna then became a woman. A perfect woman, Mohini, the enchantress. She approached him bearing the sixteen love-charms of marriage. …… the axe swang, the head rolled, Mohini wept as a widow should.”

“ And this scar? Do you want to deny the truth of this scar?” Asked Yuvanashva, parting his dhoti, revealing the gash of child-birth on his left inner thigh. “Everybody knows what that is” said Simantini “ A hunting accident, where you were gored by a great boar’s tusks.” Outside the crows cheered. What a brilliant lie! Order has been restored. The family tree was on full bloom. Its honour intact. 

“Even Ila lost control of his senses. When moon waxed and his body turned masculine, he discovered he continued to harbor a woman’s thought. .. and when the moon waned, and his body turned feminine, he could not stop feeling like a man, and he yearned the company of his wives.”

These are some of the paragraphs from the book I have coined to entice you to read the book. It would be a mythological experience of a different kind.

Freakonomics by Levitt and Dubner

The cover of “Freakonomics” introduces the writers Steven D Levitt  as “ a rogue economist  exploring the hidden side of everything. This is not a book on economics in in the classical sense, not even macro economics. But it is an interesting  reading  mostly summarizing the outcome of various papers written by Steven D Levitt .  Co-author is  Stephen J Dubner, an award winning author and journalist.

In Levitt’s view economics is a science with excellent tools for gaining answers but with a serious shortage of interesting questions. To look for such questions he has worked on the borders of economics with psychology, criminology, sociology etc.

Sample the following questions :
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1. If drug peddlers make so much money, why do they still take shelter with their mothers?
   
2. Which house is more dangerous for a neighbors' child, the one where the keeper has a gun or the one which has a swimming pool?
3. What did really cause the crime rates in the USA to plunge during the last decades? Is it good policing, gun laws or mothers’ right to abortion given by the courts twenty years ago?
4. Do the real estate agents have the best interest of their clients at heart?
5. Why do black parents give their children names that may hurt their career prospects?
6. Is Sumo wrestling corrupt?
7. Do the school teachers cheat to meet high-stakes  testing standards?
8. Do more police translate into less crimes?
9. Do money really wins election?

To find answer he move upon piles to data, analyze them and then takes to some convincing and logical conclusion. Many cases, the answer is not the obvious and he has provided sound data based logic for the same.|

“ Through forceful storytelling and wry insight, they show that economics is, at root, the study of incentives, how people get what they want or need, especially when the other people want or need the same thing”

It is all about incentives !

CULT by Arindam Chaudhuri and A Sandeep

In CULT , as the name suggests, Leadership  and Business Strategy is ruthlessly defined. Written by Arindam Chaudhuri supported by A Sandeep, it  is “a view on vision, you won’t find anywhere”.  The Financial Times, London calls Arindam Chaudhuri  “the maverick management guru” and  The Hindustan Times calls him “the intellectual litterateur of the decade”. Honestly speaking, I did not take much notice of him, except for his annual  speeches on budget , until I read this book. I should say it is a must read, whether you ultimately agree with his ideas or not. Written in very powerful language, the book is an eye opener.

What should be the quality of a vision statement ? “ Vision has to be extremely number driven ( profit, sales, m-cap, employee productivity, or any other factor you may wish to include ) and time oriented ( in how much time what’s the visionary target to be achieved)” .

Do you really need a mission statement ? “ In privately held companies, accordingly to Arindam not needed. In large organization the mission statement is inarguably one of the most important public relationship exercises undertaken by any organization to be accepted as ethical, society friendly, value based and for the benefit of the stakeholders.”

The second chapter of the book is in all praise for authoritarian leadership. Sample this “ This is because while leadership styles which are more democratic and are wonderful to be read and applied, the fact of the matter is that such styles can be successful only when the people you are leading are most mature, responsible and ambitious. But finding such mature people to work with is near impossible!”

In technology driven world today according to Arimdam, the leaders have realized that given a choice, most employees will be underproductive. So more and more technologies in the form IT and other methods are used to force them to deliver.

About Apple Andrew Keen wrote “ There is not an ounce of democracy in Apple. That’s what makes it a paragon of such traditional corporate values as top-down leadership,  sharply hierarchical organization and centralized control. And today it is one of the most valuable IT company of the world.

The Virgin’s  method of using CEO as a brand has been praised to the hilt. But Vijay Mallya has been ignored, as the argument may not fit here with Kingfisher debacle. `

Summarizing the first three chapter he writes “ have an audacious vision at every level, whiplash employees into submission so they work, ensure that the world recognizes your face as being the face of the corporation and finally have a to-hell-with-everyone-else attitude hanging around”.

He does not like the split of roles between the CEO and the Chairman. As per McKinsey nearly 80% of the S&P 500 companies combine both the roles into one. It appears also in a Christian & Timbers study it was shown that the stockholders’ return was 5% lower in European Companies who implemented the spilit.

Successful entrepreneurs are moderate risk takers not gamblers.  As American Management Association quoted in the book “ Great Leaders are informed risk takers. They act decisively, not recklessly, to maximize “lucky” breaks.

He quotes Dr Sheila Dikshit, the Chief Minister of Delhi in the book. “ For me a leader is a person who people believe is capable of taking risks. The greatest requirement for a leader, however, is communication. If you are unable to communicate, you cannot lead or manage” 

Hold regular meetings and punish the guilty accordingly. If you thought that giving the employee a stick in the public was unethical, think again. That is not what successful leaders like Jobs have thought.

Putting the right team in place is not adequate, one has to engage with the team regularly, effectively and with total clarity, they cannot be left in the autopilot mode, howsoever talented they are. “ if you want to a real transformation sweeping through your organization, make internal meeting mandatory, and extremely regular. “

Merger and Acquisitions he calls as Murder and Acquisition. One IBAC research shows 90% of the M&As will fail to live upto expectations. Most of the CEOs now prefer organic growth and extensive partnership compared to M&A. 

As per the writer the four major differentiators for any organization in terms of capturing market share are (a) Service (b) Style (c) technological superiority, perceived or real and (d) quality.  “ Why would you want to know through a sticker everyday that there is ‘INTEL INSIDE’ your laptop? That is a shrewd technology positioning by Intel”

The book deals with many other topics like the power of MBA, Multi-tasking, Loyalty, Globalization, R&D, SBU, etc. etc. An interesting reading !

“Smart Trust” by Stephen Covey and Greg Link (with Rebecca R Merrill), is a book on use of trust for creating prosperity, energy and joy in a low trust world. Smart Trust is different from blind trust and distrust. Trust is the essential ingredient for better teamwork. But it is not easy. More often than not, we like others to trust us, while we not so much trusting the other. And the reverse is also true. There are certainly one or two examples in every one’s life, when one has faced colossal damage, emotional, monetary or both, by trusting another person. Con artists thrive on their ability to make others trust them blindly, and make millions, if not billions, just by simple heartless cheating.

Between Blind Trust and Distrust, there is a third alternative the “Smart Trust”, which starts at the third chapter of the book. “Knowing a great deal, is not the same as being smart; intelligence is not information alone, but also judgement”.

Smart Trust is judgement. It is a competency and a process that enables us to operate with high trust in a low trust world. It minimizes risk and maximizes possibilities. It optimizes two key factors (a) propensity to trust and (b) analysis. The propensity to trust is primarily a matter of heart. Having high propensity to trust, is a vital dimension of Smart Trust, as long as it is combined with high analysis.

 “Trust but verify”, is the Russian proverb.

Smart trust has three elements :

1.      Opportunity : What is the opportunity ahead, what are you trusting with, what are its dimension. Grameen Bank for example trusts that all its borrower will return the money, Nexflix trusts that all its members will return the DVDs. If this basic is not there probably the business model is not there.

2.      Risk : To trust is to take a take a risk. In organization perspective to not to trust is also to take a risk. Smart Trust is to manage this risk wisely. The task is always to distribute the trust in a manner that the risk is minimised, and that will maximize the prosperity, energy and joy. We have to understand (a) possibilities of the outcome (b) likelihood of outcomes and (c) visibility of the outcome. In short what is the degree of the risk. The need of analysis will depend on the degree of the risk. For example, the need of the written routine to be followed for every process in a nuclear submarine cannot be the same as a newspaper vending machine. Still both the activities have some routine process, only the complexity differs.

3.      Credibility : Just by trusting another person, you cannot get the desired result or output from him. Credibility again has two parts (a) character and (b) competence. If a person does not have competence, even being trustworthy he cannot bring success and joy, because he cannot perform. On the other hand trusting a competent person, who lacks integrity is also not a good option, as he might turn out to be a cheater in the ultimate.

The book has many illustration and stories, to make the things lively. The action points for practising smart trusts are as follows :

a.      Choose to Believe in Trust

b.      Start with Self

c.      Declare your intent and assume positive intent in others

d.      Do what you say you are going to do.

e.      Lead out in extending trust to others.

While doing the above never forget to analyze and putting a proper framework for analysis.

One of the may accolades received by the book is from Yang Yuanqing, CEO Lenovo which says :

‘“Smart Trust” delivers ideas that are thought provoking, tools that work, and a perspective that I think is essential for survival and success on the global stage.”