The Diversity Blog

It is September of 2007, I am sitting in an auditorium filled up with 150 young school students generally under the age of 15 years. The event is 58th Conference of International Astronautical Congress at Hyderabad, under the theme of “Touching Humanity: Space for improving quality of life”.

The then President of India, Dr. Abdul Kalam is the chief guest, walks in just in time for his Q&A with these students. There is a tremendous sense of anticipation.

In no time he is on the stage with the Chairman of ISRO Dr Madhavan Nair. He needs no introduction. He has always been known as India’s rocket man!

“I have two questions” he says, “before you start asking me your questions”!

“How many of you want to go to the moon?” In a flash, 300 hands go up. He smiles.

“And how many of you wish to go to the Mars?” Yet again, the same 300 hands are up!

He cannot help smiling again and looks at the ISRO Chairman. “Madhavan”, he says, “you better do something about this aspiration. They are anyway going to get there”. Kalpana Chawla, Sunita Williams and Rakesh Sharma would be just pioneering greats on a long list in making.

Then very quickly a young girl training as an astronaut is introduced to the audience. Wow, what a feeling that was.

Pierre Lys, my fellow delegate, who was a space insurer then and I catch up at a tea break. He was attending a parallel session on space debris and wonders what is it that I was doing at the kids’ session.

“Well Pierre”, I tell him, “I just got a glimpse into India’s future.  Nothing could be more telling”.

I can only say that the Mars mission is the beginning of a very long march. It represents first of many baby steps. Please be on the lookout for what comes next!

I had the pleasure of presenting a paper titled “Adapting long-tail pricing models: Scope for shared learning – India & China” recently at the 2014 China International Conference on Insurance and Risk Management (CICIRM), in Shenzhen, Guangdong province, adjoining the Hong Kong SAR. A city that late patriarch Chairman Deng Xiao Ping wanted to mirror Hong Kong. Mirrored it has in terms of high rises, elegant highways, golf courses and what have you.

The conference venue Ping An School of Financial Service itself located on the edge of a golf course, is in close proximity to Mission Hills the world’s largest golf club with a dozen courses. The School is one of the 50 small and large campuses across China, owned by Ping An Insurance Company. The insurer is currently building what is supposedly world’s second tallest structure, the Ping An Tower.

Metaphorically Shenzhen’s aerial graph is representative of Chinese insurance business. From late eighties or even early nineties when the Chinese life market was virtually non-existent and non-life had just begun to warm up, it is today a USD 100 billion market with Auto class exceeding 70%. Some analysts believe it will double by 2020. Nowhere in the history of civilised world has the non-life segment grown at such pace. This makes China almost ten times larger than India. Their non-life portfolio mind you does not include the Health segment.

Unique challenges:

Despite significant differences, China and India have many underlying similarities. The character and circumstances particularly in the long-tail class create opportunities for collaboration. There are also interesting possibilities in the voluminous process driven short-tailed classes.

Long-tail liability class poses unique challenges in any jurisdiction where new products are adapted for the first time. Generally most non-life insurance contracts are for one year. But not all are alike. One where an injury or other harm takes time to become known and a claim may be separated from the circumstances that caused it by as many years fall in the long-tail class. Claims can be presented to the insurance company a long time after the occurrence of the trigger event.

The key issue to such a class relates to an appropriate pricing. With no past experience on frequency and severity of claims, in this class, the pricing models have to be adapted from overseas environment from where these products are transplanted. As tort raises its head in adapted markets, pricing adequacy will be tested in such places. In the meantime, what do markets do to ensure there are no rude shocks-in-making. Particularly when pricing pressures in the short-tail classes tend to have a rub-on effect on the longer-tailed. In wake of the de-tariffication we are witnessing some serious pricing reductions in the short tail classes year on year, which are not sustainable and harmful for all stakeholders in the long run.

The big question, therefore, is whether the long-tail class pricing is aligned to the market conditions? The obvious answer is no. So what may happen if this is not the case. Well, there could be several scenarios:

• Pricing assumptions may relate to overseas markets (say product liability or errors & omission) and the book for such markets grows.
• Book for domestic markets may grow and so could the risk factors and thereby the multipliers applicable in home markets of these rating assumptions may outlive their utility. About three decades ago, for example, Hong Kong was in the midst of one such debate. The erstwhile British colony virtually rebelled to the proposition of applying the UK multipliers when considering settlement of bodily injury claims. The logic was simple. Hong Kong’s per capita income, inflation and longevity of its people was way above those in the UK. This eventually led to the case for capping the unlimited bodily injury cover as the claims started spiralling.

The introduction of tort law in China since 2010 and the implications of the Indian Companies Act 2013 transform the two playfields across all liability classes be it Motor Third Party; Medical Malpractice, Directors and Officers and the whole range of Professional Indemnity space.

In the long run it is the domestic transformations that need to be watched more closely. An analogy may be drawn with manufacturing cycles of the Far East markets which started as export hubs but steadily became markets for their own wares. China will be no exception as the internal consumption rises. Likewise, the back office capital of the world – India, is beginning to plug into the needs of its domestic market. Such changes will create far larger risk environments at home. The triggers will generally sit inside and not outside these economies and societies. Some of them may very well be in place and shall manifest in a matter of time. In the meantime have the covers been adequately priced to pay for the future claims, is the key concern.

It is indeed very impressive to see the number of non-life actuaries qualifying and also the number of young Chinese pursuing doctoral programmes in insurance. We have surely a lot to learn and imbibe if we need to bring in some brain power in the evolving complexities and scale of this new class of risk in our economy and society. A collaborative effort can only strengthen the outcome for both countries.

Till about the late eighties and early nineties the Indian insurance market was largely a corporate commercial book. The retail class began to take off on the back of increased demand well after the arrival of health insurance (primarily in the form of ‘Mediclaim’) and only when the auto boom picked up. The relative size of the latter also received a boost after the meltdown of the tariff classes. China on the contrary took off thanks to its own auto zoom. It produces in one month what we do in twelve. It may very well happen that in this huge build-up of the retail segments, the complexities of long tail related to the corporate and commercial classes may not receive adequate attention by either of us. Particularly when both the markets are predominantly obsessed with profits post investment returns rather than an underwriting profit.

Conclusion:

Perhaps the biggest dissimilarity between our two markets arises from the transaction language. The Chinese virtually use no English. This could provide some interesting opportunities. Our obsession with English is almost like turning a blind eye to non-English possibilities. Imagine what size could open up if we were to unlock the potential backup to the Chinese BFSI opportunity. Firstly, in Chinese (primarily Mandarin) and maybe in the long-run by supporting their aspiration to switch to English. There is a plenty of room to collaborate not so much in the form of Chinese insurers investing in our insurance business but primarily in knowledge sharing; managing big data and analytics. High time we look at the big neighbour face to face rather than the current back to back stance and proactively deal with a liability situation that could collectively become larger than the existing in the US. It is after all about a win-win for two of the world’s three largest economies.

Published in Asia Insurance Review, March 2009

Twenty one years ago when I first went to work and live in Hong Kong, a drive to the border post of Luk Ma Chow was a major attraction. From here one could peep, across the border, into a not so distant Shenzhen in the Guangdong province. All that you saw in the close proximity was duck farms. On a clear day, without having to rub your eyes, you could also spot an emerging concrete jungle of tall buildings with cranes atop. And you could not miss out a high density of container traffic flow through the border check point.

I had spent a couple of years in Thailand before this assignment. In the course of which I made a very fascinating discovery. Thanks to a trader client well connected to the land of his origin and a new found ‘guanxi’ (network).  He would buy used earth moving equipment from the world over, recondition them and export these to China. What is it that spurred such a demand?

Like never before, China was moving the earth. For the first time in the history of mankind any part of the world witnessed such frenetic pace of growth. The GDPs of coastal areas including Guangdong grew 30 to 40% pa. The stories about truck drivers with wives on both sides of the border or guys getting overwhelmed by things like showers in hotel rooms in Guangzhou – are a couple of a multitude of frivolous stories I can recount – from those times. But on a serious note, a few weeks ago, I crossed the border into Shenzhen, on an invitation to present a paper at an academic conference. It is then that I witnessed the full thrust of what the late Patriarch Deng Xiao Ping meant by “One Country, Two Systems”.

The Shenzhen magic races far beyond the Special Economic Zone, which the pragmatic leader saw as a counter to the then English colony of HK. The times when the English Governor Chris Patten of the queen’s territory daily sparred with a super power in making. The ferocious velocity of which was perhaps far beyond the scales of their speedometer. An hour plus long drive brought me to the Ping An Institute of Finance. The big gates open into a very modern and immaculately landscaped full sized golf course and an impressive array of buildings. The foyer of the main building has a statue of Confucius and Einstein greeting you.

The famous Mission Hills Golf Club, world’s largest golfing ground with a dozen courses, is close by. I am told Ping An, a leading insurance company, has 50 campuses big and small across China. A market which is already a USD 100 billion worth of non-life business and slated to more than double in the next ten years needs a very large army of knowledge workers and this is indeed one definite way of building it. This is where the amazing growth story rolls on notwithstanding the English language.

At the grand dinner by the host company in the Mission Hills Golf Club, I have young David from the Tsinghua School of Management from Beijing sitting on my left. He has lots of questions and observations from this only Indian at the event. It does not take much effort to convince him to call me by my first name. India is a land of mystery to me, he says. He is curious about the serious divide between the rich and poor. We continue our dialogue between speeches and the toasts.

The return ride back to the Shenzhen border next day was fascinating. I tried hard to figure out which was the tallest building around and where was the Ping An tower sprouting, world’s second tallest building – to – be after the Burj Khalifa, Dubai. My driver today, as well, merrily laughs to my queries in English. He is blissful and it does not really matter to him whether or not he is proficient in English. Life transformed for good, despite it. He is speeding as if these freeways have been there forever and the big cars is what he grew up in. Then suddenly there is a roaring sound from behind. A red Ferrari, wanting to overtake all that is ahead. In no time it navigates through and well before I can focus my phone for a quick shot, it’s gone. I have even stopped hearing the prancing stallion.

Once back home, I get a polite mail from my new found friend David Zheng enclosing some pictures from the event. I promptly thank him. And then comes the return mail which looks and sounds innocuous. “Dear Praveen, he says, It’s glad to receive your message! And this is my first time to receive message from outside of China…” It’s like I wrote a postcard to him some five thousand years ago when our’s were the two dominant civilisations.

We actively traded on the silk route. There was an amazing flow of wares and ideas. We had the well known Hiuen Tsang (Xuanzang), the ‘Prince of Pilgrims’,  and Fa-Hien (Faxian) visiting our centres of learning. We exported Buddhism to them. We also exported the concept of Dhyan (Sanskrit for a state of no-mind), which moved to the Buddhist language Pali incarnating as Zhan. Becoming Chan by the time it reached China and eventually Zen in Japan!

Today after several millennia David Zheng found a medium to communicate and complete the loop. He has bridged the march of our civilisations. I am sure the mysteries will shed. Like my revelations beyond the duck farms at Luk Ma Chow…

Currently in a city named after Chief Seattle (1790-1866, a member of the Squamish – Duwamish tribes), I cannot but help alluding to his profound reverence for nature. It represents an underlying unity for howsoever vast diversity of a humanity. Mind you, all this with the ongoing Football World Cup in the backdrop!

Despite living in a wired and connected world, the accessibility to a live match is a function of your being awake (and willingness to be) in front of a receptor which has an access to the coverage channel. The good part was as the matches unfolded, I was moving ‘closer’ to the host country. Hence the ability to see any telecast during daylight hours. Given that I was on long flights only made it very compelling that I somehow find the right screens at transit airports. An older passion such as Wimbledon could always wait. I was, therefore, not the only impatient one in front of the Heathrow screens that insisted on a dose of Tennis alone.

Whilst in New York, bang in the heart of Manhattan, a big screen behind the hotel, besides a park, all matches were live. In the US versus Belgium, looking at the crowd mix, you could never guess where that may be. A melting pot of America that was anything but Caucasian. Every time the Yankees attacked Belgian defence, the crowd roared and waved the Stars & Stripes. The ending was not to their liking and that’s when you could figure out that the diverse lot was indeed American.

Once again, at the JFK. The scramble for live screen was evident. Brazil was playing Colombia. A national holiday for the Colombians. Brazil was still the contender and on a pedestal. As the two teams battled the ones with Brazilian affiliation made a pronounced presence. “I am half Portuguese and half Brazilian living in America. I supported those two teams till such time they were around. It’s got to be Brazil now”. Then someone mistakenly perceived to be supporting the Colombian forays was asked was he from that country. How could others miss out his wrist band with the obvious shades of yellow and green? All he had to prove his loyalty was to point it out and say “Man just look at this!” “What did you make of the Brazilian outcome”, I asked a Colombian couple yesterday. They were most graceful in their comments and indeed supportive. Finally, it’s a final with Europe pitched against South America!

Interestingly, I get a sense that not everyone has so far gone by the ‘country’ template. You may rather be guided by your choice/ choices of a club or cup or league affiliation hence a player in a team becomes your team. African origin players dominate many teams even though African countries may not have reached thus far. A Boateng brother in Ghana will not hold back his delight for the other Boateng in the German team!

Asians did not fare too well either. With Japan, South Korea and Iran scoring just a point each. There are enough kids around there who can tell you virtually anything everything about teams and players. Balls manufactured in Pakistan; referees from across the world and a German coach for the Americans was not the only exception.

And back to Chief Seattle (quoting Wayne Dyer from his Wisdom of the Ages) best known as the man who wrote a now-famous letter to the President of the United States, asking him to consider American Indians’ point of view. Every part of the earth is sacred to his people, he wrote, and we are all part of the precious earth, as well as being brothers in spirit.

Chief Seattle asks us to increase our awareness of the soft sounds and the sweet smells of life. In so doing, we will treat our environment with greater respect not only for its natural beauty, but because we become aware that we are a part of this interconnected web of life. We all share the same breath, the animals, the trees, and one another. Whatever be your nationality or inclination, as long as football (er soccer) is your passion and humanity your religion it does not matter who wins come Sunday, mankind wins. Hail Chief!

What can just a century of history do to the ‘transformation’ of thought and action of a nation could not be better illustrated than this one!

‘One hundred years ago, Senegalese natives were put on display in Norway to drum up support for colonialism. Today, two artists have recreated the exhibit…and they stand by their art’, reports the Daily Beast.

‘The Norwegians then opened what would become an immensely popular attraction—a human zoo populated by Senegalese villagers living in grass huts. Over the course of five months, the erroneously named “Congo Village,” drew 1.4 million visitors—more than half the country’s population—to gawk at an exotic cluster of sub-Saharan dwellings and traditionally dressed inhabitants. The display, bizarrely, had been billed as celebration of the bicentennial of Norway’s constitution signing.’

This time over it will exhibit volunteers taking turns living on show in makeshift huts, resembling a traditional sub-Saharan village, reports Balzas Koranyi in the Reuters.

‘Displaying 80 people in a human zoo in Oslo’s most elegant park, two artists hope their “Congo Village” display will help erase what they say is Norwegians’ collective amnesia about racism.

Re-enacting a similar display from 1914, Lars Cuznor and Mohamed Ali Fadlabi say Norway, one of the richest nations in the world, with a reputation for tolerance, has only suppressed its intolerance, especially around the time of the national day.

“Norwegians have been propagating this self-image of a post-racial society and it’s been internalized that it’s a good, tolerant society,” Swedish-Canadian Cuznor told Reuters on Friday. “It’s great branding and it’s self perpetuating but it’s a false image.”

The government-funded display opened just days before Norway celebrates the 200th anniversary of its constitution, a day marked by parades all over the country with most people dressed in traditional costumes and waving flags.

“May 17 is the day you feel most foreign and it’s also when racism comes to the surface with debates about whether people have the right to wear their own costumes or display non Norwegian flags,” Sudan-born Fadlabi said.

“Norwegians felt superior in 1914 and they still do through their self image of goodness.”

Public Art Norway, the government agency that put up part of the funding, said the display highlighted questions concerning racism and cultural dominance.

“The rebuilding can be regarded as a monument to the collective loss of memory of a shameful part of our history and a platform for discussion of this historical event, contrasting with Norway today,” it said.

The display, costing 1.4 million crowns ($240,000), has touched off a fierce online debate about whether Norway really is as racist as the artists suggest.

Cuznor says even their exhibition permits hint at the country’s intolerance because they cannot stay overnight, so they do not attract the homeless or Roma people, he said.’ Says Koranyi in Reuters.

Is it about re-engineering the ‘General Will’ or overcoming collective amnesia? Whatever it is, here is in the least a creative attempt to address an unhappy past. Hopefully the scope will expand to include who’s who in the colonial zoo!

After cetaceans’ likelihood of winning human-hood and the Romanian election resolve by a green political party that I wrote about, here is some more on these highly evolved creatures. CNN recently reports:

“Just when you thought this divorce couldn’t get any messier. Weeks after Russia annexed Ukraine’s Crimea region, it plans to take custody of dolphins in the nation as well. Not just any dolphins. These highly trained military mammals detect risks such as sea mines or enemy scuba divers trying to slip through. Sea mines are sophisticated weapons that can sink ships and other watercraft.

“The combat dolphin program in the Crimean city of Sevastopol will be preserved and redirected toward the interests of the Russian navy,” state-run Russian news agency RIA Novosti reported Thursday.

Dolphins are a crucial part of open-water security. They detect sounds and objects in murky waters that human beings can’t, making them uniquely effective at highlighting dangers on the sea floor.

Harnessing the military power of animal intelligence

Ukraine was using outdated military equipment for the dolphin program and planned to disband it next month, RIA Novosti said.

The Ukraine Defense Ministry told CNN that the nation has an ocean dolphin facility, but declined to provide details, saying they’re classified.

The dolphin program dates to the 1960s, when Russia and Ukraine were part of the Soviet Union, but was handed over to Kiev after independence.

The U.S. Navy in San Diego also trains dolphins and sea lions to help protect its assets and find dangerous objects underwater.

Ukraine also has combat sea lions that operate under the same base. It’s unclear whether they’ll be barking allegiances to Moscow or Kiev.”

Surely, none of these sea animals participated in the referendum. Given their high levels of intelligence, the outcome could have swung any which way, had they been given an option to vote!

Published in The Journal of Insurance Institute of India, January-March 2014

While India epitomizes “Unity in Diversity”, it manifests in different situations diverse ways. Ravi Venkatesan’s book (Win in India, Win Everywhere – Conquering the Chaos) is a first-hand guide for Corporate India successfully dealing with local challenges, winning here and thereby succeeding not just here but in all emerging markets. Lucidly illustrated with anecdotes, it also vividly prescribes the leadership qualities most desirable for the country head role and the mindset at the global headquarters.

‘India is on the minds of business leaders everywhere. Within a few decades, India will be the world’s most populous nation and one of its largest economies. But it is also a complex and challenging market, with a reputation for corruption, uncertainty, and stultifying bureaucracy.

The initial infatuation with India is over and reality has set in. But India is not a market that can be ignored. So why take a chance in this extraordinary and complex region? What does it take to win in India? How do you deal with the chaos – and even prosper from it?

Ravi Venkatesan, the former Chairman of Microsoft India, offers inside advice on how your firm can overcome the unique challenges of the Indian market. He argues that chaotic India is in fact an archetype for most emerging markets, many of which present similar challenges but not the same potential. Succeeding in India therefore becomes a litmus test for your ability to succeed in other emerging markets. If you can win in India, you can win everywhere.

Hard as these markets are, Venkatesan says, for most multinational firms the bigger challenge to success in emerging markets may well be the internal culture and mind-sets at headquarters. The unwillingness to make a long-term commitment to the new market or to adequately trust local leadership, combined with the propensity to rigidly replicate the products, business models, and operating systems that have worked at home drives many companies to a “midway trap” that results in India remaining an irrelevantly small contributor to global growth and profits.

Combining his personal experience with in-depth research and interviews with CEOs and senior leaders at dozens of companies – including Nokia, GE, JCB, Dell, Honeywell, Volvo, Bosch, Deere, Unilever, and Nestle – Venkatesan shows you how to tackle slowing growth, policy uncertainty, and corruption and enable your firm to thrive in India. He proves that you can break through successfully, but it takes a very different type of leadership, both locally and at headquarters.

If you want to succeed in the twenty-first century, you must succeed in emerging markets.’ All I can add – India is not for the faint-hearted; be ready to respond to its diverse challenges and success shall follow.

Diversity literature ought to be one driving convergence between whatever is divergent, rather than leave a sense of divisiveness. A fine illustration of how good can what ought to be is the chapter titled “Are You My Mentor?” in Sheryl Sandberg’s book LEAN IN.

In here she diagnoses some very compelling issues in the corporate world and prescribes very effective and global matter-of -fact prescriptions for both the genders. I would like to pick a few interesting threads and hope that those of you, who have not read this wonderful book as yet, will do so very soon. In the least please do read this chapter.

• ‘If the current trends continue, fifteen years from today, about one-third of the women in this audience will be working full-time and almost all of you will be working for the guy you are sitting next to.” (Addressing a gathering).
• The men were focusing on how to manage a business and the women were focusing on how to manage career. The men wanted answers and the women wanted permission and help. I realized that searching for a mentor has become the professional equivalent of waiting for Prince Charming.
• To be clear, the issue is not whether mentorship is important. It is. Mentorship and sponsorship are crucial for career progression. Both men and women with sponsors are more likely to ask for stretch assignments and pay rises than their peers of the same gender without sponsors. Unfortunately for women, men often have an easier time acquiring and maintaining these relationships. One recent study shows that men are significantly more likely than women to be sponsored and that those with sponsors are more satisfied with their rates of advancement.
• Because it is harder for young women to find mentors and sponsors, they are taking a more active role in seeking them out.
• Studies show that mentors select protégés based on performance and potential. I believe we have sent out a wrong message to young women. We need to stop telling them, “Get a mentor and you will excel.” Instead, we need to tell them, “Excel and you will get a mentor.”
• Capturing someone’s attention or imagination in a minute can be done, but only when planned and tailored to that individual.
• Mentorship is often a more reciprocal relationship than it may appear, especially in situations where people are already working at the same company. The mentee may receive more direct assistance, but the mentor receives benefits too, including useful information, greater commitment from colleagues, and a sense of fulfillment and pride.
• Getting the attention of a senior person with a virtuoso performance works, but it’s not the only way to get a mentor. I have seen lower-level employees nimbly grab a moment after a meeting or in the hall to ask advice from a respected and busy senior person. The relationship is more important than the label.
• Few mentors have time for excessive hand-holding. Most are dealing with their own high-stress jobs. A mentee who is positive and prepared can be a bright spot in a day.
• Men will often gravitate toward sponsoring younger men, with whom they connect more naturally. Since there are so many more men at the top of every industry, the proverbial old-boy network continues to flourish. And since there are already a reduced number of women in leadership roles, it is not possible for the junior women to get enough support unless senior men jump in too. We need to make male leaders aware of this shortage and encourage them to widen their circle.
• It’s wonderful when senior men mentor women. It’s even better when they champion and sponsor them. Any male leader who is serious about moving toward a more equal world can make this a priority and be part of the solution.
• Junior women and senior men often avoid engaging in mentoring and sponsoring relationships out of fear of what others might think.
• Many companies are starting to move from informal mentoring that relies on individual initiative to more formal programs. One study showed that women who found mentors through formal programs were 50% more likely to be promoted than women who found mentors on their own.
• Official mentoring programs are not sufficient by themselves and work best when combined with other kinds of development and training.
• Peers can also mentor and sponsor one another. There is a saying that “all advice is autobiographical.” Friends at the same stage of their careers may actually provide more current and useful counsel.’

This is almost a manifesto on mentoring. I could not make it any shorter despite leaving out all the fantastic anecdotes. Hoping that anyone wishing to make the most out of mentoring be it professional development, career advancement and overcoming gender divide – will find this an extremely valuable roadmap.