Ad Here  
When Ratan Tata visited SRM IPL type auction for VCs? Wise Presidents Limit foreign borrowings to hi-tech, export potential projects... Mu Sigma – is no more Like Hinduism: many paths to reach God... Put expensive assets created to use... When the President was rendered homeless… Infrastructure funding – lessons learnt When TN politicians can emulate Kerala's Shipping woes of Chennai companies Build close rapport with business leaders Silver Years of Madras Musings Reliance’s TV – 18 ready to launch Tamil News Channel B H Kothari - a tribute L&T- the specialty of special purpose vehicles Protest masters... Cement prices continue to rise… A welcome initiative by the judiciary Lesson from Chandrababu Naidu Return to king coal for urea... Nuclear power at the nucleus Multi-faceted Venkat Naidu’s return augurs well for Seemandhra Editor's Notes Inflation: are we emulating Argentina and Brazil? Convulsions in The Hindu Colour-Chem’s colourful KRVS WTO Meet: resolved to meet again The ‘Jayanthi Tax.’ Tribute – Manikam Ramaswami Secularism and anti-Hinduism The rise and fall of Annamalai University Gay abandon in pricing MHC should not return to its old indisciplined ways Tatas moving out of urea production... PC’s preference for professionals He continues the focus on social amelioration The ‘Ayyo-yes’ is no more He saved millions from starvation... Valli, they are more marginalised Padma Bhushan for A Ramakrishna Quality silica from Neyveli Funding the un-funded Editor's Says Delhi returns to BJP Quality education through the PPP mode A glass full of corruption Make standards certification mandatory... CSR and CMI: promise of another Srinivasan Ramanujan... A Grand Finale for SN’s MS centenary at the US… Pharma – overdose of copying Scientists urged to take up farmer-oriented research Liberal imports idling indigenous capacities More Shakthi to Das’ elbow Welcome GST Increasing non co-operation of state leaders GNS - 100: our first subscriber Music happens Poor representation for Kerala and TN in Cabinet Solar, solar everywhere … Vibrant Gujarat Gas is the way forward Not just in-laws (and outlaws); they’ve renowned academics at the helm! Noble nonagenarians... Welcome focus on core competence An enemy’s enemy is a friend The sea- saw battle continues... Modi and the lady Lalu’s envy, India’s pride Chennai and Kolkata miss opportunity to grow as Delhi and Mumbai The Ports’ Pasha expands into Tamil Nadu Welcome changes that testify to Jayalalithaa’s return to health The balancing act Whistle-Stop Tour of Raghuram Rajan PPP mode for upgrading Corporation Hospitals Rahman at CIC Towards speedy justice Adharma of opposition politics Should we change the official year? EVM is tamper-proof An inexplicable neglect Banning booze... ONGC at KG Basin Why land prices zoom in TN? The star of Spencers is no more The power-full Hindujas Bihar elections - the Rajaji formula worked New IT products of Ramco in the pipeline… Bihar – Nitish Kumar adopts the Lalu model Sweet news for TN sugar mills Don’t seem to feel the pulse… Welcome thrust on trade in Modi’s foreign visits... Things happen by accident and not by design... An informal presentation - analytical, forward locking... Solar thermal shines… The Gulf aviation boom Muffled voices for merit… Tatas moving out of urea production... The why of tax incentives A think tank for Chennai Adapt Vajpayee dinner diplomacy EEC at the National Media Centre Cleaning Ganga – relocate tanneries and install electric crematoria Contrarian cousins Delhi Chalo... Airlines in India: cost and space CIPET hqrs to stay at Guindy – for the present? Air Asia India will set new benchmarks for budget travel A rich pool of talent not utilised…. Excel Generators provide the vital back-up No Maha Koottani in TN... Rs.1600 crore paper board plant of TNPL Breaththrough in malaria control S V Raju – a ‘good’ true liberal L&T: focus on infrastructure and more infrastructure… Which side are you, Montek? The few handicaps... S Ramanathan – a versatile musician, musicologist Tribute – UCAL Selvan… TIAM turns a full cycle A yen for wastage… No engine for this car Road development slows down Kinetic Karnataka The Jan Dhan bonanza F C Kohli - his concerns all embracing Tough task taking states together Russi Mody – a tribute Naidu will soon build a new Hyderabad Shale gas and its shallow future Marketing expert Balagopal is no more The nuclear option Computation of GDP – conundrums continue A professional at the helm of IRDA... SoA @ 80 …and of a popular trade leader A C Muthiah – his munificent bequeaths to science Tax agriculture Sri Lanka votes for change A friendly business group Moily’s bold thrust All eyes on Sankara Nethralaya Cutting the nose to spite the face to the lack of interest on the part of these to focus on original research. This despite the much lower costs of such research in India. The industry which thrived on the protection of a closed economy and the advantage of a vast domestic market, has failed to organise its evolution on healthy lines Demise of a media baron... Haul over the coal A more liberated TN… Remembering Indira Sivasailam... CRS, a jewel among managers, is no more. Auto components surge… Alexa – Talking Wikipedia Tribute – M V Murugappan Why this malaise in medical education? The rise and rise of KCP Kudos to NDTV... How Air-India loses customs... Delhi is distant… When online building permits work…. Align crops to agro climate endowments… More Shakti to resource mobilisation... Readers' Mail Land reclamation from sea appears cheaper! Another Indian music maestro at the UN R Sridhar steps down as CEO of Shriram Capital A Grand Finale for SN’s MS centenary at the US… Revving up the manufacturing sector IAS invades NDDB... Engineering seats go abegging Medical costs hit the roof... Where is Rajaji? No mega rail project for Tamil Nadu West Bengal: mindless malignancy Recognition to role of NBFCs.... Where a state respects its litterateurs… Kulandai was a giant When small is no larger beautiful.. The brown list of Venkitaramanan More heat than light Plummeting profits of PSBs Eternal support for capitalisation of PS banks TELANGANA at last…BUT Fuel for thought Parliament in paralysis... Discoms deserve better… Focus on quality of power - its only around 170-180V Godspeed, Chief Minister JJ Five star activism stalls development activity For whom the bell tolls? Fall in crude prices help in oil sector reform GM Technology at last! Sweeter prospects for sugar This scant respect for Law For whom the MIDS bell tolls? Insurance companies bleeding, yet no decision on increasing FDI limit! Varuna (rain) in 2015; Vaayu (air) in 2016. Chennai devastated CII projects higher growth… Wanted: a second airport for Chennai Fortune for Indian Airlines When nations steal growth from one another… TN-leverage strength of BHEL, NLC... IPL - no surprise this scam Maximising the micro pricing … Polls and promises Waning interest in public discussions… Robber barons everywhere Paytm karo... Building loyalty through the stomach There was flood of milk. Reason: no milk commissioner! Telangana in top gear… Small units prefers to remain small... Intellectual of rare qualities More tributes to GR Mersal magnified Delhi is distant TN accounts for the largest recruits by the IT sector Online not in line with brick and mortar businesses... A proud Madrasi Boy, can you beat these? TN – agglomerate land holdings without alienating ownership Strengthen the base... Diamond jubilee of Egmore Samskrt School Dr C Rangarajan returns to Chennai Come elections, come advertisements... Shanti and Sadhana through Music Poor quality of university VCs TGS- The king storyteller Shaming of Tamils by Tamil farmers at Delhi Odisha: spectacular win by Naveen Patnaik Tihar, Puzhal not different from Parappana Agrahara Fortune 500 review Tribute Streamlining mandatory third party cover Roaring Ro-Ro facility Measuring roof tops in terms of KW/MW China invests in India Revive development banks... Making ‘my Amaravati’... Modi storms Silicon Valley London, London Narayan The Swadeshi Trump Permanent secretariat for TN GIM Of course, Gujarat is vibrant Preserving for the future
Welcome focus on core competence

The logic of sticking to knitting seems to be impacting large public sector corporations. When such a project was set up in a green field site far removed from major cities, there was the need to provide a vast range of facilities and social infrastructure. For example, when the Rourkela Steel Plant was set up in the 1950s in Odisha, the area lacked basic amenities like housing, roads, power, schools, hospitals, markets, etc. Substantial portion of the initial capital had to be spent on creating these facilities. Over the years the administration had to cope with managing a vast range of activities that had been taking its attention away from the core activity of producing steel. It plunged several public sector corporations into losses. It also resulted in bloating the workforce to levels that became unmanageable.

Tata Steel at one time had a workforce of over 70,000. A large portion of these were engaged in activities that had little to do with the production of steel. eg: managing the township, providing water supply, electricity, maintenance of roads, running schools, hospitals, sports, museum, etc. A bold decision was taken to relieve the company of most of these non-core activities. Aided by the boom in the steel sector post-2000, the company effectively hived off many of these activities to separate institutions and offered liberal VRS packages. In quick time it reduced total workforce by half. Several other corporations followed suit and succeeded in improving productivity per employee and focused on their core activities.

This has become necessary in the context of stiff competition from across the globe. There is pressure to improve incremental capital output ratio and ensure higher productivity per unit of capital employed. This has been achieved by a few sectors like the automobile and auto component industry by taking recourse to a higher degree of automation, vendor development and improving supply chain management.


Author :
Reported On :
Sector :
Shoulder :
IE, the business magazine from south was launched in 1968 and pioneered business journalism in south. Through the 45 years IE has been focusing on well-presented and well-researched articles. When giants in the industry stumbled to keep pace with the digital revolution, IE stayed affixed embracing technology.
Read more
Economist Communications Ltd is committed to ensuring that your privacy is protected.
Read more
You agree that your use of this Website and the purchase of the magazine will be governed by these terms and conditions.
Read more
S-15, Industrial Estate,
Chennai - 600 032.
PHONE: +91 44 22501236