Central and State government generates revenue from common man through direct and and indirect taxes. The revenue so generated is utilized in public utility services like road infrastructure, Transport, Healthcare, Hospitals, Law Enforcement Agencies , Defence, Parliamentary affairs etc. How is the revenue earned spent by the government and whether it is spent in a fair and transparent manner is something that every common man who is paying taxes regularly and diligently has the right to know. It is the duty of the government to allocate part of the revenue generated by way of tax in rehabilitation of the aged and retired people. As the things stand now, the government does not have any scheme to help retired people.
In a scenario like this, it is very important for the young people to start building corpus amount for retirement at a very young age. Unfortunately, the young people are so busy in building the career that they hardly pay any attention to investing their savings intelligently until they reach the age of 50 years and beyond. Most of the professionals I have come across with invest their savings in bank fixed deposits which do not give more than 6-8% returns. Considering the rate of inflation which is about 10-12% ( not an official estimate but based on price index of essential commodities), the rate of interest offered by banks is far less than rate of inflation and is therefore not a viable option. Investing in stock gives much higher returns but is highly risky. One has to consider options which give higher returns and at the same time, the risk is minimum. One has to plan how much corpus amount is required at the time of retirement so as to survive the retirement life which is approx 25 years. To give you an example, if a couple in a city like Mumbai requires on an average Rs 15,000 per month to survive as of now and considering rate of inflation as 10% per annum which is bare minimum and assuming the average age of the couple as 25 years, the minimum amount required to survive at the age of retirement is going to be approx Rs 1 Lac per month. Considering the retirement age as 25 years, the corpus amount required at the time of retirement is estimated to be Rs 3 crores. That means your savings should be minimum Re 15,000 per month and must be invested in such a way so as to enable it to grow sufficiently to reach this amount at the time of retirement. Where to invest the savings and how to invest depends on several factors that must be kept in mind. Investment in mutual fund according to me is a good option. My experience is that it gives you on an average between 15 to 20% return per annum. Money invested in mutual fund is ultimately invested in stock for higher returns but you are not exposed to risk as there are fund managers who will take care of your investments. Another area which is neglected is proper tax planning. If you are in the higher income bracket say above Rs 5 Lacs per annum, you pay 30% tax on your earnings which is a sizeable amount. The government gives deductions under section 80 C to the extent of Rs 1 Lac. If you do not avail of this deduction, you land up paying higher taxes which ultimately will deplete your savings.
I will conclude by saying that retirement enevitable. It is going to come to you one day whether you like it or not. The earlier you start planning for it, the better else it will be too late.
Monday, February 22, 2010
Tuesday, February 16, 2010
My Name is Khan
I have been reading Times of India since last 20-25 years. Earlier, the news contents was mainly focused on politics. News other than politics used to appear occasionally. There were separate papers like Screen and Cine Advance for news related to cinema. Same was the case for sports also. This has changed completely. Now a days, it is difficult to know whether the paper is aimed at focussing more on world politics or India Cinema and Cricket. The headlines on the main page contain news related to Cricket and Bollywood more often than any other news. Those readers who are not interested in these news are finding it as embarrasing. The news channels on T.V are worse than this. Their news mostly contain topics related to cinema, cricket. I have to at times switch over to BBC to know what is happening around the world. All the Indian news channels according to me are filthy, obscene, biased. These channels do not give any quality news. It is a waste of time to view such channels. The ministry of information and broadcasting is not doing nothing to improve the quality of programming. The general public is satisfied with whatever is being given in the name of entertainment. There is absolutely no protest. Prices of vegetables and essential food commodities have increased sharply in the last 6 months. Even middle class families are finding it difficult to meet both ends meet. How often has this issue been raised in media. Let there be a public debate on why the price is rising, What steps are being taken to contain the price rise. When will it brought under control. The general public wants to know all this rather than knowing how much business “My Name is Khan” has made in the first week of release or the protest of shiv sainiks over the release of the film in Mumbai or how much popular shah rukh khan is outside India. Considering the fact that 70% of the population in India does not have the basic necessities like food, clothing and shelter, it is criminal on the part of media to focus on news which has little or no significance to the real issues. Neither the government nor any of the political parties have any genuine concerns for the poor and under privileged. All they are interested in is the votes. What they give in return to the common public is the assurances, promises which they never fulfill. The media is corrupt, misguiding the general public by sidelining the real issues and focussing more on trivial issues which have no relevance to the real issues.
Tuesday, February 9, 2010
Change Management
The article on "Change Management" was written by me couple of years back. I am reproducing the same for your benefit. Here it goes.
"Change management is of great significance in any change initiative undertaken by the organisation. Rapid and constant innovation in technology is driving change in organization’s systems and processes. Government legislation, trade policies and market forces over which the organization has no control can also bring about change in the organization culture, systems and processes. If organisation does not respond to change in market forces, it will be left behind and perished. If change initiative is not handled with precision and great care, it can fail miserably. The reason why change initiative fails is not because of any lack of technical expertise but because of lack of leadership qualities and managerial skills and foresight like blurred corporate vision, inability to respond to changes , wrong prioritization, planning etc. Human factor is also very dominant in failed change initiatives. Human psychology is such that any change initiative undertaken by management is looked upon with suspicion and fear by employees resulting in resistance to change. Management must therefore anticipate employee resistance and develop a strategy to counter it. There are many reasons why employees resist change. The main reason being fear of loss of authority,control and lack of faith in their own ability to learn new skills and methodology which results in sense of insecurity. Interestingly, if they are asked as to what makes them to resist, the reason given by them will be entirely different from the deep rooted actual reason. Typically, employees reaction to change takes place in 3 phases. Initially, they are in the state of denial, subsequently, they pass through the stage of fear, anger, frustration and helplessness. Finally, they accept the change either negatively with feelings of resignation, complacency or they accept the changes positively with renewed enthusiasm to capitalize on the changes.
Employees resist change either covertly or overtly. Those resisting overtly voice their objections loud and clear. These types of employees can be easily identified and handled. They display their resistance to change whenever an opportunity arises such as taking unapproved leave, refusing to take instructions from seniors, convincing others to stick to the old system. At times , the resistance can take the form of strikes, boycotts, legal notices etc. Those resisting covertly mask their objections and are much more difficult to identify. They do not openly voice their objections for fear of termination or fines. Covert resistance can take many forms such as unco-operative attitude, absence from work, spreading rumours, complacency in work etc.
What should the management do to overcome resistance. It should firstly communicate to all the employees what has prompted them to take change initiatives, how the change will take place and how the employees and organization as a whole is going to benefit from the change. Secondly, it should communicate very clearly what will be the repercussion in business if the change initiative fails to take place. Thirdly, in anticipation of refusing to participate in the change process by some disgruntled employees, management should chalk out detailed action plan to counsel them and if need be take appropriate measures to thwart their plan to scuttle the process of change.
Change initiatives typically usually starts with great fanfare but dies down slowly after couple of months. Change requires putting up lot of extra efforts. Unless employees are self motivated, it is very difficult to sustain the motivation level over a long period of time. No amount of external motivation like incentives, fear factor etc can work for long. Clear vision, Positive thinking, self belief, empowerment, affirmation, visualization etc are internal motivating factors that can change the attitude of employees.
Organisation should appoint change agent to implement change initiatives. The change agent should have the clout, conviction and leadership qualities to make things happen. Besides these qualities, change agents should also have technical skill depending upon what type of change initiatives are undertaken. Change initiative may be required to restructure organization to make it more customer centric or it may be required to reengineer business process or ERP implementation. Change agents should not be part of project team responsible for BPR or ERP implementation. This is so because members of project team are more focused on improving systems, processes and technology, whereas change agents are more focused on human behaviour.
Certain change initiatives which require restructuring organization culture are extremely difficult to implement because this type of change initiative impacts the organization as a whole and not confined to a particular section of employees and therefore very time consuming. The motivation level of employees have to be sustained over a long period of time else the change initiate will fail resulting in colossal waste of time and effort made."
"Change management is of great significance in any change initiative undertaken by the organisation. Rapid and constant innovation in technology is driving change in organization’s systems and processes. Government legislation, trade policies and market forces over which the organization has no control can also bring about change in the organization culture, systems and processes. If organisation does not respond to change in market forces, it will be left behind and perished. If change initiative is not handled with precision and great care, it can fail miserably. The reason why change initiative fails is not because of any lack of technical expertise but because of lack of leadership qualities and managerial skills and foresight like blurred corporate vision, inability to respond to changes , wrong prioritization, planning etc. Human factor is also very dominant in failed change initiatives. Human psychology is such that any change initiative undertaken by management is looked upon with suspicion and fear by employees resulting in resistance to change. Management must therefore anticipate employee resistance and develop a strategy to counter it. There are many reasons why employees resist change. The main reason being fear of loss of authority,control and lack of faith in their own ability to learn new skills and methodology which results in sense of insecurity. Interestingly, if they are asked as to what makes them to resist, the reason given by them will be entirely different from the deep rooted actual reason. Typically, employees reaction to change takes place in 3 phases. Initially, they are in the state of denial, subsequently, they pass through the stage of fear, anger, frustration and helplessness. Finally, they accept the change either negatively with feelings of resignation, complacency or they accept the changes positively with renewed enthusiasm to capitalize on the changes.
Employees resist change either covertly or overtly. Those resisting overtly voice their objections loud and clear. These types of employees can be easily identified and handled. They display their resistance to change whenever an opportunity arises such as taking unapproved leave, refusing to take instructions from seniors, convincing others to stick to the old system. At times , the resistance can take the form of strikes, boycotts, legal notices etc. Those resisting covertly mask their objections and are much more difficult to identify. They do not openly voice their objections for fear of termination or fines. Covert resistance can take many forms such as unco-operative attitude, absence from work, spreading rumours, complacency in work etc.
What should the management do to overcome resistance. It should firstly communicate to all the employees what has prompted them to take change initiatives, how the change will take place and how the employees and organization as a whole is going to benefit from the change. Secondly, it should communicate very clearly what will be the repercussion in business if the change initiative fails to take place. Thirdly, in anticipation of refusing to participate in the change process by some disgruntled employees, management should chalk out detailed action plan to counsel them and if need be take appropriate measures to thwart their plan to scuttle the process of change.
Change initiatives typically usually starts with great fanfare but dies down slowly after couple of months. Change requires putting up lot of extra efforts. Unless employees are self motivated, it is very difficult to sustain the motivation level over a long period of time. No amount of external motivation like incentives, fear factor etc can work for long. Clear vision, Positive thinking, self belief, empowerment, affirmation, visualization etc are internal motivating factors that can change the attitude of employees.
Organisation should appoint change agent to implement change initiatives. The change agent should have the clout, conviction and leadership qualities to make things happen. Besides these qualities, change agents should also have technical skill depending upon what type of change initiatives are undertaken. Change initiative may be required to restructure organization to make it more customer centric or it may be required to reengineer business process or ERP implementation. Change agents should not be part of project team responsible for BPR or ERP implementation. This is so because members of project team are more focused on improving systems, processes and technology, whereas change agents are more focused on human behaviour.
Certain change initiatives which require restructuring organization culture are extremely difficult to implement because this type of change initiative impacts the organization as a whole and not confined to a particular section of employees and therefore very time consuming. The motivation level of employees have to be sustained over a long period of time else the change initiate will fail resulting in colossal waste of time and effort made."
Monday, February 1, 2010
Cyber Theft
Cyber theft is far more dangerous than physical theft because unlike in physical theft wherein the thief can steal only after entering the premises physically, the thief in cyber theft can steal sitting thousands of miles away from you. The worst part is that you will not be even aware of this with the result that the loss to you will be far more severe. There are laws framed in our constitution to deal with physical theft. Offenders can be penalised under various sections of Indian Penal code. But for cyber crime, there are no proper cyber laws in our country. With the increasing use of internet, cyber crime is increasing day by day. General public is not fully aware of the consequences of using credit card for online shopping or Operating bank account through internet.It is estimated that over 85% of all unwanted emails often described as "Spam" contain links to spurious websites and businesses that are out to cheat you. They can not only hack your email addresses but even your passwords without you being aware of it. This will enable them to take virual control of your PC. They will have access to all sensitive information you may have stored in your PC which they can misuse. For example, if you have stored credit card details in your PC that can be used to make online purchases. or if you have stored personal details like email id, password, personal details of your internet banking, that can be used to siphon off money from your bank account.
Sometimes, you will receive an official looking email usually with your Bank's logo telling you there may be a problem with your account.You are instructed to click on the link to bank's website except that it is not the Bank's website although it may look like that. Again you are asked to confirm account details, numbers and addresses. If you respond as requested, within minutes the information you provide can be used to make fraudulent purchases over the internet. You will realise it only after you receive a statement from Bank perhaps weeks later. It can lead to identity theft wherein the hacker can open account in your name providing all the details of your personal information and operate it without you even realising of it. Terrorists can hack your PC identification no and use it to send threatening mails to targets. Such emails can be traced to your PC and you will unnecessary be looked upon with suspicion by investigating agencies.
If you are holding credit card, you will receive statements of purchases made by you through credit card. If you happen to notice any discrepancy in the statement, you will call customer service number which is usually written on the reverse side of the card. This telephone is not that of bank but of call centre to which the bank has outsourced this service. If you are talking to someone on this number, you are in fact not taking to bank personnel but to call centere employees. The person who is attending to your complaint will ask you details like your credit card no, Tel number, Date of birth etc as part of verification procedure to ascertain that you are the genuine person. This sensitive information can be misused by the call center employees who can furnish these details to a hacker at a price. Last year, a BBC reporter posing as a fraudster revealed how easy it is to get such secret information at a nominal price say at $10 per card in India. Information you think is secret is not actually remains secret.
Here are few tips on what you should do as a victim. If any purchase that you have not made is reflected in your credit card statement, do not pay under any circumstances,. Your bank is likely to try and make you pay. But as long as there is no negligence on your part such as letting someone else use your card or writing your PIN on it, you must protest such charges and refuse to pay. In many cases, the bank's security system may spot the suspicious purchase before you do and telephone you to check if it is legitimate. To prevent these incidents, the banks have taken certain precautionary measures like publishing in their websites certain dos and donts for their customers.
Never throw credit card statement on the dustbin as credit card statement contains your personal financial details on it. Similarly, never leave ATM statement on ATM machine. Never let your credit card be out of sight even in petrol pumps or shops or restaurants. In case of restaurants, accompany the waiter to the cashier's desk. Never provide photo copies of your card showing 3 digit CVV number which is written on the back side of the card. Use licensed copy of anti virus software to detect and remove any virus from infected files or incoming mails. Never use pirated copy of anti virus software because these softwares themselves may spread virus in your PC. Remove cookies from your computer from time to time.
Sometimes, you will receive an official looking email usually with your Bank's logo telling you there may be a problem with your account.You are instructed to click on the link to bank's website except that it is not the Bank's website although it may look like that. Again you are asked to confirm account details, numbers and addresses. If you respond as requested, within minutes the information you provide can be used to make fraudulent purchases over the internet. You will realise it only after you receive a statement from Bank perhaps weeks later. It can lead to identity theft wherein the hacker can open account in your name providing all the details of your personal information and operate it without you even realising of it. Terrorists can hack your PC identification no and use it to send threatening mails to targets. Such emails can be traced to your PC and you will unnecessary be looked upon with suspicion by investigating agencies.
If you are holding credit card, you will receive statements of purchases made by you through credit card. If you happen to notice any discrepancy in the statement, you will call customer service number which is usually written on the reverse side of the card. This telephone is not that of bank but of call centre to which the bank has outsourced this service. If you are talking to someone on this number, you are in fact not taking to bank personnel but to call centere employees. The person who is attending to your complaint will ask you details like your credit card no, Tel number, Date of birth etc as part of verification procedure to ascertain that you are the genuine person. This sensitive information can be misused by the call center employees who can furnish these details to a hacker at a price. Last year, a BBC reporter posing as a fraudster revealed how easy it is to get such secret information at a nominal price say at $10 per card in India. Information you think is secret is not actually remains secret.
Here are few tips on what you should do as a victim. If any purchase that you have not made is reflected in your credit card statement, do not pay under any circumstances,. Your bank is likely to try and make you pay. But as long as there is no negligence on your part such as letting someone else use your card or writing your PIN on it, you must protest such charges and refuse to pay. In many cases, the bank's security system may spot the suspicious purchase before you do and telephone you to check if it is legitimate. To prevent these incidents, the banks have taken certain precautionary measures like publishing in their websites certain dos and donts for their customers.
Never throw credit card statement on the dustbin as credit card statement contains your personal financial details on it. Similarly, never leave ATM statement on ATM machine. Never let your credit card be out of sight even in petrol pumps or shops or restaurants. In case of restaurants, accompany the waiter to the cashier's desk. Never provide photo copies of your card showing 3 digit CVV number which is written on the back side of the card. Use licensed copy of anti virus software to detect and remove any virus from infected files or incoming mails. Never use pirated copy of anti virus software because these softwares themselves may spread virus in your PC. Remove cookies from your computer from time to time.
Subscribe to:
Posts (Atom)
