Jag Venugopal's Blog

September 15, 2011

How would you like to work for Hindustan Cables?

Filed under: Project Management — Jag @ 10:03 pm

Recently, I learned about an Indian public-sector company called Hindustan Cables. They were established in the 1950’s, with British technology, to manufacture telephone cables. Along the way, they set up three plants, and grew to 2800+ employees. The main product of the company is something called PIJF — Polythene Insulated, Jelly-Filled Cables. These are apparently used in laying wired landline phones.

 Along the way, India’s liberalization led to a burgeoning wireless telephony industry, almost entirely in the private sector. Demand for Hindustan Cables’ products decreased, and eventually dried up completely. But the three plants and all the people on company payroll soldier on, because no one can fire them or sell the plant and machinery.

 As is the norm for all government companies treading water, Hindustan Cable consulted with an external entity (one of the IITs), to determine whether the unit could be revived. The consultant came back with a recommendation to build entirely new plants with entirely new technology. The government is, at present, casting about for a joint venture partner to fund the new plants. Investing in such a company via a joint venture is something no private capitalist will ever contemplate. They may yet arm-twist one of the rare profit-making public-sector companies into entering the joint venture so the losses can be hidden under that company’s balance sheet.

 In the mean time, Hindustan Cables’ staff are keeping busy. They have acquired ISO 2001 certification, a fetish for Indian companies, big and small. In addition, they have developed the rather innovative concept of forming quality circles in plants where there is zero production. If ever there is production of Hindustan Cables’ obsolete product, buyers can be assured that it meets ISO standards. The research and development staff, too, have been keeping busy, finding import substitutes for various components. The research would surely come in handy if ever the world decided to abandon wireless and return to the days of wired telephone service and the rotary dial.

 The company has generously taken care of its employees as well, catering to their payroll and occasional raises for no work. Training, too, is provided to keep employees on the cutting edge of technology, circa 1950. And being the generous employer that it is, the company  “has taken regular steps … such as providing vaccines, polio, measles, tetanus etc. and other family planning measures”. As is to be expected, the company has been very diligent about implementing an affirmative action program for its employees.

 English is used to conduct most business in India. These days, most Hindi film and television program credits are in English. Virtually all Hindi spoken on television has now been corrupted to “Hinglish”, delivered by actors who barely know the national language. It is a rule that the more vociferous a politician is in support of Hindi, the greater the chances that his children are studying in a crème-de-la-crème institution where the medium of instruction is the Queen’s language.

 Hindi’s (lack of) standing in the business arena does not stand in the way of the worthies at Hindustan Cables, who have gone about incorporating Hindi into all aspects of their business, right from their web site. In their (literally) copious spare time, they have made sure to learn the national language, reply to letters in Hindi, and make all signboards, seals and stamps bilingual. Seminars and training are also delivered in an attempt to foist the language upon management and staff.

 Finally, being the good stewards of the environment that they are, the company’s management have ensured that the skylights are kept clean. This allows more natural sunlight to filter in, reducing the need to illuminate the non-functional factories with incandescent light.

 All of the above would be funny and amusing, if Hindustan Cables wasn’t losing upwards of $100 Million each year. This is but one loss-making public sector company, of which there are likely hundreds, making, as BusinessWeek states, “everything from condoms to steel”. The total loss per year on account of these companies is estimated by business week at $3.4 billion per year. This is money India desperately needs, to improve its non-existent infrastructure, to provide adequate nutrition, water, health care, education, and sanitation to its teeming masses. Unfortunately, these benighted souls will still not receive their deliverance, as the government prefers to spend the money so workers in companies like Hindustan Cables “punch their time-cards in and out … they get paid, receive the occasional raise and eat in subsidized canteens, even though they produce nothing”.



1 Comment »

  1. […] generate jobs, look no further than two companies in India that I have blogged about in the past: Hindustan Cables and Haldia Fertilizers. The former does not produce an inch of cable, and the latter, not an ounce […]

    Pingback by Birthers, Tea Partiers and now… Socialists. Where’s the GOP headed? « Jag Venugopal's Blog — January 13, 2012 @ 8:59 am | Reply

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