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A. V. Ram Mohan

WATER is scarce in Chennai, right? Wrong, if you observe the number of water tankers dripping and spilling their precious cargo throughout their routes. Petrol and fuel are expensive and dwindling resources, right? Wrong if you go by the number of vehicles idling in traffic snarl ups and diversions due to processions and similar important prerequisites of democratic life.

We may think we are a capital-starved economy that can ill afford to waste a single rupee. We will be wrong again if we see the monumental dimensions of the NPAs sitting in loan books, since non-performing assets represent the amount of capital wasted by society.

Again, a traffic planner may think the road surface area in the crowded cities is a premium resource. He would be wrong to think so when he sees five-feet-wide road dividers, some of them with flower plants in them, eating up road surface area that should be carefully utilised.

There are equally valid examples of squandering of scarce resources in corporate life too. People with rare technical abilities crucial to the success of the company would be wasting time on inconsequential work. Top management time and concentration, if spent away from activities of direct benefit to the company, are to be seen as sheer waste.

When meetings do not start on time or, worse, go on endlessly without a decision, management time is gone forever. Admittedly we cannot recognise some of these examples for the waste they are, since we are so used to seeing crucial items being wasted in public; they do not usually register in our mind.

What is the point of these examples? Do people not know that water, fuel, capital, road area and management time are items in short supply, not to be wasted but carefully husbanded? As individuals every one of us knows the value of these things; just look at our domestic savings ratio, which is near the highest in the world.

Not just in money matters, in everything else we do as individuals we are frugal to a fault: we drink our soft drinks till the last drop, build up every square inch of space in our homes, monitor the mileage in our vehicles carefully, use water with utmost care, and so on.

Frugal and correct in private lives, recklessly profligate in society, would be a fair summary of our behaviour. Rational in private, wasteful in public means we are leading a double life in society. This is by no means unique to India, we share this fate in varying degrees with many less developed countries, such as those in Africa.

There is a managerial reason why this is so in poorer societies; the resource allocation mechanisms for commonly identified scarce commodities are not in place, or broken down or over-ridden by political compulsions. Apart from obviously tangible things such as water or power, others are not seen as scarce resources with any degree of urgency.

The invisible hand of market mechanisms does not work in situations where there are no trade in goods, such as road surface area. When people waste petrol in traffic pile up, the bill is not added up and paid by a collective entity; it is small enough individually to put up with a helpless sigh.

When the top management wastes time, its own and others' around them, it is done unconsciously without reference to its value. Banks as a rule do not want to lend to dodgy projects, but end up doing so due to compulsions. We expect some overarching power to ensure that public good such as water, road area, fuel usage are equitably distributed, well managed for common good and regulated for optimum usage.

When we have so many inter-connected bodies with different constituencies, resource allocation of scarce commodities falls between several cracks. It takes a long while before such wasteful situations are identified as wasting resources, since their total impact is not seen at one time. Even if they are identified as such, there would be the usual all-inclusive explanation: political compulsions and management practices.

It is time such public wringing of hands must stop. Time to align our pubic wasteful behaviour in line with our private carefulness. How to do this alignment? Easy, if we say these are the five resources, identified as critical in any situation and hence shall not be wasted at all costs.

The allocation mechanisms and usage of these resources will need to be carefully reviewed, as though the final bill is paid by one body. Voluntary organisations will monitor the instances of public wastes in these five resources and will advise the government leadership to act to stop such instances.

Designers of public systems, such as road dividers, should be made conscious of the value of what they are dealing with. Does the system promote better use of the identified scare resources, is the key question to be asked whenever a new proposal comes up.

A national consciousness, which goes beyond writing slogans on the back of buses, in dealing with these five resources must be awakened.

The leadership in every situation must satisfy the optimum use of these resources, in every one of their actions. If they do not do it voluntarily, a well reasoned argument from voluntary groups should be able to set right matters. The same model can be modified for corporate use, and perhaps easier to implement.

Why focus on only five resources at a time? In most situations, public or corporate, it is only a small number of things that make a big impact. There is a god of small number of things in action, which makes it easy for implementation. While waste is inevitable we must be alert as to what we waste: it should not be what we have the least.

(The author is an executive with Ramco Systems. The views expressed here are personal and not of the company he works for. He can be contacted at rammohan@rsi.ramco.com)

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