What Happens Next?

In this post let us think about what happens next as we start to come out of the Covid-19 related lockdown.

No country can claim to be immune from the economic effects of the Covid-related lockdown. However, as countries start to emerge from the lockdown some will rebound faster than others.

What is happening now?

Let us next look at where we are today. Today, large number of people and businesses have seen the flow of money reduce to zero. The expectation of a return on investment is low for a large section of the economy. That said, certain sectors are doing quite well or as normal (e.g. groceries, online retail) as they are getting overflow business.

In this situation with little or no money going to people / businesses someone has to step in and be that ‘credible borrower’ and borrow on behalf of those who are struggling. This is the Government as the ‘credible borrower’ which then passes the borrowed money on to its citizens in a low-waste manner one hopes. One point here is that it is easy for a Government to print money rather than borrow, but that can lead to inflation without actual growth – so called ‘jobless growth’.

We can take the current situation as artificial suppression of demand and supply (as people loose incomes and stores are forced to close/reduce visitors).

This can also be understood as a scenario where blood supply to an organ in the body has been blocked. The body reacts in the very short term by reducing the function of that organ and rushing out chemical support to suppress pain but in the long term the body is severely impacted unless the block can be removed and/or another path can be found to deliver the required quantity of blood.

What happens Next and How to Deal with it?

It all comes down to effective planning and effective use of people, processes and tools.

Businesses that have or are able to quickly get the required plans in place for short and long term changes to how they work will benefit from overflow business.

People who are able to re-skill or move from impacted areas to areas of new opportunity will be able to benefit from continued employment during the rebuilding period.

Both the above things should allow some blood to flow to the organ but it does not restore normal supply nor fixed the original damage that resulted in a block.

Repairing the Damage

The repair will start once the lockdown ends. Those countries that release the lockdown earliest (and are able to ride the second wave of infections) will have ‘first movers’ advantage towards normalisation. This should also promote local business that step in to fill the gap from imports where possible.

The key point to keep in mind here is that we will not go back to status quo. Just as scar tissue is never as smooth as the torn skin it replaces. We will loose some businesses. Some people will fall into debt and be unable to recover without help.

Due to loss of incomes, social distancing and widespread work-from-home we will find demand continues to be suppressed for some time to come. This will be especially true for ‘non-essential’ goods. This means the suppressed demand must be unlocked using some of the options we will discuss below.

Who sinks/swims is down to how they prepared during the crisis for the post-crisis period (i.e. if they did not look to change business-as-usual and let a good crisis go to waste then they will sink) and how effectively they can implement those strategic plans in the coming months. This is a good example of Darwin’s Survival of the Fittest.

Who will survive:

  1. Those who are quick to plan and implement new processes that allows them to generate revenue.
  2. Those who have deep pockets to fall back on, for the next 12 months (at least)
  3. Those who are able to focus on their strengths and optimise resources – when we look at (2) we must remember “Markets can remain irrational for longer than you can remain solvent” (by John Maynard Keynes)
  4. Those who are directly benefiting from the crisis (short term survival)
  5. Those who enjoy a good name in the market or are ‘expected’ by the market to bounce back quickly

But what is the Recipe for Success? What should we do more of as a business?

  1. Advertise: Replace front-office with a slick website, smartphone app and/or virtual agent (even a chat-bot helps handle the first level of queries)
  2. Process transformation: Reduce the need for manual processes in business operations – this is not something only multi-million pound business need to do! In fact this is something everyone needs to do!
  3. Digitise and Automate as much as possible – from fundamental building block apps (e.g. billing) to more advanced planning, optimisation and prediction apps (Here is a golden chance for AI at the lower price-point. Or even local AI consultancy)
  4. Concentrate on strengths and focus your resources on the service/product that provides the greatest rewards – enable home delivery where possible – smart phones + hybrid/electric vehicles should reduce cost of operations and bring home delivery to the same price point as in-store
  5. Don’t stop innovating.. innovation is the hidden strength of any business (large or small!)

As an individual, facing an uncertain future in terms of employment, lot of the above points are just as relevant (once the context is changed):

  1. Advertise your existing skills and experience (make a website, LinkedIn profile), talk about your interests and hobbies! Blog!
  2. Look inward: Look at all the good stuff you have done, all the mistakes you have made and the lessons you have learnt. Try changing something small about yourself that you feel will improve the way you feel about yourself. For me this was ensuring I take in a lot of outdoor play time with my kids!
  3. Prepare your tools: make a CV, take stock of where you have been and where you want to get too! You won’t get another chance like this to plan your career!
  4. Concentrate on your strengths: reduce expenditure, improve efficiency by doing the important things and ignoring things that lead to waste of time, money or both. One personal example: we started cooking more at home which resulted in not only money saving but also us discovering new things that we could make at home!
  5. Don’t stop learning! Now is the time to take a risk. Make sure you use all the tools available to engage with people who are leaders in your field of learning as well as fellow students – this can be anything – from cooking to a language
  6. Don’t stop thinking and creating. Write a short story, create a new dish, draw a picture, change the layout of your living room! These act as massive confidence boosters

Additional Thoughts: Automation

Automation was on the rise before Covid. The bigger players have already moved online and use automation enabled IT therefore continue to sell effectively (albeit within constraints). But the contact-less nature of the solution to this problem will push app/online interaction even more. As this happens, it makes it easier to automate the interaction. Two small examples:

  1. Pizza shops now only support cashless delivery, no collection. Therefore, all my interaction with the pizza shop is through their website or an app (e.g. JustEat). The pizza is placed on my doorstep and I hardly even see the delivery person as they back away more than 2 meters and leave as soon as they see me pick-up the pizza.
  2. Food stalls in various food markets have started home deliveries (again cashless and contact-less). Earlier they would hire staff to manage long queues, today they operate behind a slick website (that you can throw up in a few hours), a scheduling tool, and WhatsApp messaging to personalise the interaction.

This effect when combined with the long term trend of more people working from home (which is bound to accelerate now) is an opportunity for small business to deliver local services through different app-based platforms involving lots of automation (to make it cheaper). The smaller players have to make use of the same force-multiplier tools, platforms and channels as the bigger players right now! The most basic one is the ability to accept online orders and payments.

Now that people don’t travel for work then they no longer form a captive market for food vendors, coffee shops and bars. But these things can come to their doorstep! With automation enabled IT the cost of home delivery can be managed especially with the added benefits of scale.

Finally: I am still waiting for the day I can order Starbucks coffee to my home for the same price (if not cheaper) as what I get in the stores. Starbucks could open coffee-making kitchens in different areas and serve the area from there. Automation will help by providing seamless links between different stages, AI-based planning and prediction of demand.

International Recycle Card

It is encouraging to see availability of recyclable packaging such as plastic wrappers, cans and food containers. But we see the problem of incorrect disposal, littering and lack of waste segregation everywhere (here I believe developed and developing countries are alike).

What incentive can the public be given to not only correctly dispose off their litter but also to pick up after others?

One common method has been the use of bottle/can bank where you return empty bottles and/or cans and you get some money in return.

My idea is to extend this and making it streamlined. 

Concept is simple.

Prerequisites:

  1. All packaging to be uniquely identified using RFID/barcode/QR code etc. – this should identify the source of the packaging and the unique package itself. Something like a bar-code
  2. Everyone buying packaged items has a Recycle Card (app or physical)
  3. (Optional) People buy items using electronic cash (e.g. credit cards) – to attach personal details

Process:

  1. Person scans the item (and the package code is also scanned alongside) – over time these could be the same code.
  2. Alongside the bill, a full list (electronic) is provided on the app for Recycle Card of all the packaging you have purchased (when you purchased the product).
  3. The ‘value’ of that packaging in terms of the local currency will also be shown.
  4. Upon successfully recycling the packaging, a part of that ‘value’ will be credited to the person. This can be a monthly or weekly process.
  5. Any litter found is scanned. The full ‘value’ along with a small fine is debited from the associated Recycle Card. The Recycle Card of the person who found the litter and correctly disposed it gets a small credit applied to it.

This means we recognise the value (in terms of money) of the packaging and not just the contents. This I believe is partially happening where ‘green’ products with innovative packaging attract a premium prices.

Furthermore we should attach a loss (again in terms of money) with improper disposal of the packaging. That is done only through fines but without direct accountability.

Key Factors:

There are two important steps here:

  1. Detecting successful disposal: This should be automated probably at the recycling centre some sort of machine which can scan and tally the packaging and indicate which Recycle Card should be credited. Packaging is unlikely to arrive intact at the Recycling centre. Therefore multiple markers need to be provided. RFIDs are a good solution but may be too expensive for regular use. One option is a dye that exhibits florescence under certain light. This would give a code that can be detected using machine vision. This is similar to the Automatic Number Plate Recognition software that has become very popular at parking lots, toll plazas and petrol pumps. 
  2. Registration of the Recycle Card: This should be a global system. Mainly because the problem of plastics and other packaging materials will impact everyone. Especially if these end up in our Oceans. People should be obligated to correctly dispose packaging where-ever they are in the world. Those who do so should be rewarded and those who don’t penalised. To ensure this – every pieces of packaging must be uniquely identified. This is a big task and I am sure there will be manufacturers (perhaps small/medium sized ones or from the informal sector) who will no follow this system (at least in the beginning due to cost etc.). But the idea is to target the 80% before we target the 20%. In the sense that big companies like Unilever, Nestle, etc. and fast-food joints like McDonalds have the capacity to upgrade their packaging. These are also mass-consumption products. So it would have a noticeable impact.

Do let me know what you think about this idea!

Somewhere in there there are few good machine learning and big-data use-cases. 🙂

Pokemon Go! Evolve vs Transfer

Each type of Pokemon needs certain number of candies (of a compatible type) to evolve to the next level. Usually you need  either 12, 25, 50, 100 or 400 (Magikarp) to evolve to the next level.

The exact number depends on the Type of the Pokemon as well as its current evolution level. For example Pidgey to Pidgeotto requires 12 Pidgey candies where as Pidgeotto to Pidgeot requies 50.

When looking to evolve Pokemon we often need to ‘transfer’ a few back to the Professor to earn candies before we have enough for the evolution. This is especially true in two cases:

a) Uncommon types (dependent on location etc.): where you will end up having far larger number of that type than you will be able to utilize for evolving. For example in our area there are very few Machop, and for the first level you need 25 Machop candies. Thus I will need to catch 9 Machop before I can evolve Machop! But if I was to transfer I could evolve after catching 7 (giving me 7*3 = 21 Machop candies) and then transferring 4 (giving me 4 Machop candies).

b) Very common types (to maximise evolutions especially if you have a lucky egg activated): where if you have a few hundred Pidgeys (again far few that you can evolve).

In both cases you need a way to calculate, given the current number of a particular type (e.g. for a Pidgey and Pidgeotto are different types even though they are part of the same evolution chain), the number of candies available and the number of candies per evolve – how many extra evolutions you can have by transferring some Pokemon.

The formula is:

ToInteger[(Nt + C) / (1 + Co)] – Nc = Ne

Nt = Number of currently present Type

C = Number of currently available Candies

Co = Number of Candies required for next Evolve

Nc = Number of possible Evolves without Transferring

Ne = Number of extra evolutions possible by transferring Pokemon

For example:

Let us assume you have 103 (C) Eevee candies. Now each evolution of Eevee (which has only a single level) requires 25 (Co) Eevee candies. Let us assume we have 30 (Nt) Eevee with us.

This gives:

Nc = ToInteger(103/25) = 4

ToInteger[(Nt + C) / (1 + Co)] = ToInteger[5.11] = 5, thus Ne = 5 – 4 then Ne = 1

Which means we can return Eevees to get one additional evolve!

 

Now we need to find out exactly how many Eevees we need to return to achieve that one additional evolve – while making optimal use of existing Eevee candies. The so called Equilibrium condition is that we have no un-evolved Eevees or unused Eevee candies after the evolutions.

The formula for Number of Returns (Nr):

Nr = [(Ne + Nc)*Co] – C

From the example above we have: Ne = 1, Nc = 4, Co = 25 and C = 103, which gives:

Nr = [(1+4)*25] – 103 = 125 – 103 = 22

Thus to make optimal use of existing Eevee and Eevee candies we should transfer 22 out of 30 Eevees and utilize the candies gained from transfer to evolve the remaining Eevees.

The result is not at Equilibrium because we will be left with 3 Eevees after we return 22 and evolve 5 [30 – (22+5) = 3].

Enjoy!

Please Gamble [Live] Responsibly

In UK there is a habit of trying to plan and manage everything. While this habit is one of the main reasons for the advanced state of development enjoyed by the countrys’ residents, sometimes it can be pushed to insane limits.

For example, out here  all gambling websites, shops and even advertisements need to have information pointing to ‘GambleAware’ along with the advice: “Please gamble responsibly”. The main purpose for this is to remind people to ‘gamble responsibly’ and to show people with gambling related problems a way out.

All that is well and good but my question is how can one gamble ‘responsibly’?

Gambling itself is an act of taking a risk. So they are asking us to ‘take a risk’ with responsibilty? If you were responsible for something would you take a risk? The obvious answer to that is ‘depends’ on what you were responsible for and what was the associated risk, but that brings us to the question of what exactly is involved in gambling. What is it that we are risking?

So I went to the GambleAware website to try and figure out what they highlight as ‘risks’ of gambling without responsibility… in other words what is their definition of ‘gambling responsibly’. This is what I found (from their website http://www.gambleaware.co.uk/responsible-gambling):

 
 
 

A person who gambles responsibly:

  1. gambles for fun, not to make money or to escape problems.
  2. knows that they are very unlikely to win in the long run.
  3. does not try to ‘chase’ or win back losses.
  4. gambles with money set aside for entertainment and never uses money intended for rent, bills and food.
  5. does not borrow money to gamble.
  6. does not let gambling affect their relationships with family and friends.
Weird!
1) Gambles for fun … : Well I don’t know about making money but as far as escaping problems is concerned then they should put the ‘Please escape from reality responsibly’ advice up on each and every source of entertainment. From movies to sports! Isn’t that what we use these things for? To escape from reality which is usually full of problems?
 
2) … very unlikely to win … : They should put ‘Please create babies responsibly’ advice in each and every hospital’s maternity ward. To warn the newborns that life is a game that is impossible to win. Everyone dies in the end!
3) … win back losses. : I thought it was a good thing to overcome odds and to ‘win back’ what one lost. Some of the greatest people did this to ‘achieve’ greatness. I also thought this was part of human nature to try and overcome loss. This is what allows us to go on in face of great odds and rebuild our life. This calls for the following general advice: ‘Please loose responsibly’.

4) … money set aside for entertainment … : This calls for the following advice in all shops: ‘Please spend money responsibly’ because we know that whenever we go into a shop or supermarket or a mall, hundreds of offers/sales/deals are thrust into our face! That is why expensive brands (which we really can do without) are reduced marginally in price so that the average person, thinking of it as a deal, tends to buy them leading to overspending.

5) … does not borrow money to gamble. : This is a good one. All the banks out there distributing credit cards like they were going out of fashion listen up! Put the following advice in bold letters on your credit card: ‘Please borrow money responsibly’. So that people don’t run up huge credit card bills buying things they don’t need and cannot afford just because they are able to ‘borrow’ money easily.

6) … affect their relationships …  : Another good one. All offices should have the following advice in all public areas: ‘Please work responsibly’. Also all managers and senior managers should be sent on special ‘working responsibly’ courses! We know work is one thing that affects our relationships the most. It keeps us away from our loved ones even after work hours. Gives us stress which we often take out on people we love.

Maybe we just need one advice tattood on the arm of all newborns: ‘PLEASE LIVE RESPONSIBLY’.

😉

So what do you think guys? Do you think we will see these bits of good advice popping up anywhere soon?

UK Elections: A Ringside View

UK Government elections are coming up in a few weeks time (May first week).  This election is a face-off between the Labour Party, who have been in power for the last 12 years, and the Conservative Party, who are sensing a real chance to form the government this time. There is a third party – the Liberal Democrats, dream of becoming king-makers and in reality can seriously affect the base of the two established parties.

One issue which, according to those who claim to be the ‘experts’, is going to dominate the voter’s minds is the economic crisis that gripped UK last year.

I believe that in politics your point of view is decided not by logic or analysis but by the political party that you belong to. Keeping this in mind, the fact that the UK economy has just about limped clear of the recession can be seen from three different prespectives.  

The Labour view is that they have taken some ‘very difficult’ decisions through some of the ‘toughest times’ seen by ‘world’ economy and have guided the UK economy out of the battlefield. According to the Labour government the economic crisis was not of their creation but something external in which the UK economy got dragged into.

The Conservatives have the view that Labour was responsible for the country facing such difficult times. That if they had been in power they could have helped UK sustain the storm better.

The Lib-Dems do not have a clear view of things. They keep changing their views depending on what the two major parties are saying.

There is one thing though, that all three of them agree on:  they have to take some ‘very difficult’ decisions and  some of the ‘toughest times’ are still ahead for the country.  

All three are saying there have to be big cuts in Government spending to reduce the deficit. But what exactly should be cut and how the resulting gaps will be filled, changes with the party. Great fear is also being generated regarding cuts in frontline services (e.g. Police and NHS).

What no one is willing to admit is the fact that the road ahead is not full of options. The steps that can be taken are limited. Yet the voters are being fooled into believing that there are multiple roads out of the mess and that each party holds the map to a different route.

Looking at these things from a temporary resident’s point of view I can say if frontline services like NHS and Police are cut then it will surely make the country less attractive for skilled workers. Free healthcare and a safety are two major requirements especially when it comes to people with families.

Immigration is the second point where these parties will clash. Again there are not that many options out. Already immigrations laws are very strict. Apart from closing the Tier 2 (Work Permit) and Tier 1 (Migrant Worker) schemes to South Asians (which will damage the UK economy and push work out of the country) they really can’t do anything.

To clamp down on illegal immigration will require increased government spending (for better border security and tougher enforcement) but the question remains: where will the money come from? Also the government will never admit this but illegal immigrants contribute a lot to the UK economy. They do the kinds of job which the locals will not do. Illegal immigrants, in fact, help the UK economy by providing cheap labour. They don’t pay any tax but even if they were legal the amount they earn would keep them well below the tax bracket.

In my view this election is going to be about whichever party screams the loudest and is able to convince the UK voter that yes indeed they can pull rabbits out of hats and pennies out of thin air!

Life is a box…

Someone recently asked me how would I like my life to be.
I thought about it and replied that life was not a retaurant where you go and give your oder “I would like my life to be a bit spicy but go easy on the problems”.
If we could “order” our life then there would be no growth as who would wish for tough times and problems from which we can learn?

The next question was what do I want from life.

This led to a second insight about the nature of life. I realised that life was like an empty box. Whatever you put in is what you will come out. Also while there are things in the box they change (like all things in nature). Another important point is that while it is up to us what to put in the box and when to put it, we have no control over takin things out. The only guarantee is that things we put in will come out.

So choose wisely what you put into life!

🙂

The multi-Billion Dollar Scam: Selling unsustainable dreams…

The real estate sector is booming in India. Areas just outside the four metro cities have seen land rates shoot up like a NASA rocket.

A textbook case is the suburb of Gurgaon touching the southern border of New Delhi. Till 10 years ago it was a dusty under-developed area with bad infrastructure. It was not a hot favourite for house-hunters and real-estate developers. How can I say all this? I had relatives living in that area and have been visiting them since I was 11-12 years old. I have seen that area develop as I was growing.

Then came the multi-national corporations, the call centers and the big brandnames. These were followed closely by the shopping-mall culture and a major empowerment of the young working Indian. All this meant that within a short span of time on a 4 km stretch of the Meherauli-Gurgaon road there were 6 shopping malls standing shoulder to shoulder.

While individually these were no where close to their western counterparts, taken together they formed a solid block of shops surrounding on of the busiest roads connecting Gurgaon with South Delhi. Within months the Meherauli-Gurgaon road became a nightmare for regular commuters. Being stuck in traffic for hours became normal.

Yet the property prices in Gurgaon kept increasing. New real-estate projects started springing up all over the place. There were buildings but no roads. Homes but no water or electricity. The boom was fueled by the ITeS boom in India and rise of home loans where young professionals starting their first job were able to buy flats and land. People made a lot of money selling dreams.

But what is the reality? Infrastructure is still trying to catch up with Gurgaon. Non-existant transport facilities are being supported with a new metro system. But what about water?

What about sustainability?

A crore’s worth of property is not of any use if you do not get water when you want to have a bath or electricity when you want to sleep. While power shortage can be removed (if your children are lucky then maybe in their lifetime) what will we do about water?
Study sees dramatic drop in Indian groundwater – longterm prospects are anything but bright for a good supply of water.

With a declining water table, unpredictable rains the long term forcast for Haryana points towards it becoming an extension of the Thar desert.

What will happen to the billion dollars worth of real estate? The investment in our future will be equal to a pile of sand?

Lack of sustainable development and blind destruction of the natural shield that is Haryana does not give a solid foundation to any kind of long term investment (for e.g. property investment).

The above factors make the real estate boom in India a bubble waiting to burst. When this bubble bursts a lot of people will be left with shattered dreams.

Few people though, will be left with a load of money they made selling unsustainable dreams.

The World and I

Does the world exist around us or do we exist in it?
I think the answer to this question reveals a lot about a persons thought process.

Most people will obviously ask what is the difference between the two views. What is the choice that we are being given in the question?

The fundamental difference in the choices is the net flow of influence. Do you end up influencing the world around you or are you influenced by it?
For most people there is no net flow because situations where the world dictates you are balanced by situations where you dictate the world.

In fact if there is no net flow then you are doing well in life according to me.

Why not us?

Netherlands from air looks like an island. Instead of roads in between fields they have canals. The entire country is built on water.
UK is famous for its BAD weather. It is cold and damp.

Both countries today are counted amongst the worlds most developed countries.
People will point to their colonial past as the source of their wealth. But these countries did not always have these colonies. The colonies were built up with strength and resolve. It is not easy to conquer and command people halfway around the world.

These countries had similar problems as India. Problems related to oppression of poor, caste system, superstition, domination of religion and wars.

As time passed the fate of these countries diverged from that of India. We became the shoe on their foot. The diamond in their crown.

What could be the reason?
Maybe it was the lack of a global point of view?
Maybe it was something to do with looking for short term riches over the long term benefit of the people.
Maybe dictatorship and rule of kings went on for a decade longer than it was supposed to?

Maybe the politicians and industrial elite took over from the rulers of old to exploit people? But the same happened to Germany that to not once but twice.

What could it be then?
Could it then be the inability of India to control its population growth? It could certainly be a major factor. Bigger the car more powerful an engine it needs. Furthermore more passengers on board lesser is the efficiency of the engine.

Where to go from here?
Start a one child policy like China?
Or better educate people so that they understand the advantages of a small popultation?

Evidence from Kerala indicates the second option is just as good (if not better) than the first. Kerala’s population growth stands around 1.8 which is similar to that of China but a whole lot less than the National average for India.
Kerala also boasts of 99% literacy.

This means education has a clear link with population growth which in turn has a major effect on economic and civic growth of the country.

If the equation is so simple again I ask… Why not us?

The Three Laws of Thermodynamics

First Law:

The total amount of matter and energy is conserved. Even though matter might turn to energy and visa-versa the total amount is always conserved.

> Money/Wealth etc. (matter) and Effort (energy) can convert into each other. But the total amount of it remains the same. So someone expends a lot of energy to get little matter so that others can get a lot of matter by expending little energy!

Second Law:

The total amount of entropy (chaos or disorder) in the universe always increases. In other words everything must eventually age and run down. For example burning paper produces smoke which means a net increase in entropy takes place. But we never see smoke re-assembling itself into a piece of paper.

> The world is going to descend into chaos no matter what we do. So why give a damn worrying about it. Why spend energy organising things around us. Why fight chaos?

Third Law:

No refrigerator can reduce temperature to absolute zero (−273.15 °C, the lowest possible temperature).

> Absolute zero means perfection. It means at absolute zero there is no chaos there is no randomness because it is the lowest possible energy state (of zero energy). There is perfection. But we can never reach perfection as we can never reach the lowest energy state. Therefore perfection is not achievable.