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Snapshot
    • How can the present government and BJP apply the famous Michael’s Porter’s model of strategy?
    • Three kinds of positions: variety based, needs based and access based need to be employed.

Few decades back, Michael Porter in the Harvard Business Review (November 1996) wrote a seminal article called: What is Strategy?

As he clearly articulated, having a well-defined strategic position is vital for a business to succeed. Over the last few decades several businesses have glossed over this aspect and have failed miserably. In this article we are looking at how we can apply these ideas to the domain of politics and governance. In particular we are looking at the current NDA government led by Prime Minister Modi.

Michael Porter Michael Porter

Operational Efficiency

Michael Porter clearly distinguishes ‘operational efficiency’’ with ‘strategic positions’. Operational efficiency is about executing better than competitors. He cites the case of Japanese manufacturing which took lead over US manufacturing using the ‘Lean Model’. They managed to produce high quality items, faster and cheaper. By excelling in operational efficiency they managed to go beyond the trade-offs between quality and cost as well quality and time. However operational efficiency can help a company only till competitors catch up with you.

What is Strategy?

As per Porter, strategy is the creation of a unique and valuable position (strategic position) gained by doing a different set of activities compared to rivals. These activities need to be deliberately chosen and executed in alignment with the position. There needs to be a fit among the activities, and they should create a company’s strategic position working together.

A company may serve few needs of large number of customers or serve broad needs of few customers or serve broad needs of many customers in a narrow market. Any company trying to do more than one of these will only be straddling between multiple positions. The key point about strategy is to recognize the need to make careful choices and stick with them for a reasonable amount of time. Here it is also more important to choose what not to do. For example, a luxury airline expanding into budget routes only confuses its customers, employees and its entire value chain. Sustainable strategic positions need trade-offs.

How do we go about creating strategic positions? Porter talks about three kinds of positions: variety based, needs based and access based.

Variety Based Position

In a variety based position, you can choose to support important common needs of all people, broad needs of some people or serving broad needs of many customers in a narrow market.

If we map this to politics, regional parties cater to broad needs of many people in a well-defined region. Then we have identity-based parties which position themselves to cater to broad needs of specific caste groups or coalitions, say through caste-based reservation.

The Modi government has implicitly assumed the position of supporting important common needs to the people. We call this position Development as a Mass Movement. It has reiterated this position when they talk about Clean India, Make in India, Digital India, Justice and Development for all. All these schemes have emotional connect with the people. Schemes such as ‘LPG Give up’ programme had unprecedented success.

The government has further reinforced this position using proactive popularization. It, however, needs greater impetus through systems and processes to make sure that all these priorities are achieved. If things do not work out, different groups may drift from the party, one by one.

Needs Based Position

The next position is needs based. This is closer to customer segmentation.

There seem to be three voter segments which the BJP has targeted. These segments may overlap.

The first segment of voters has been impressed by the call for focus on development, away from identity politics. This harnessed positive energy among people, all over India. We can call this constituency as votaries of ‘Acche Din’.

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The second segment of voters has got frustrated due to endemic corruption, black money, the stranglehold of mafias, crony capitalism, the loot of national resources, NPAs and with the justice system (that more often than not fails common people with no connections). These votaries for change can be called the votaries for ‘Sachche Din’.

The third segment of voters are unhappy that India is a ‘soft state’ and Hindus are a soft target. The incidents of rape, attacks on women and children have further worsened matters. Broadly we can call this constituency as votaries of ‘Surakshit Din’.

The three promises of Achche Din, Sachche Din and Surakshit Din have to be realized hand-in-hand for the country to progress. They cannot be tackled in isolation.

Another way to look at voter segments is from an economic angle. While the rich have influence as they fund political parties and the poor form a sizeable vote bank, the middle class are generally ignored. The middle class has traditionally supported the BJP but is generally forgotten after the polls.

Access Based Position

The third and extremely important position is the access based position. This is based on how customers/voters access services. To gain a strong position here the government/BJP needs to articulate a new position where people get what they actually need rather then what they claim as entitlement.

This may mean opening up all communication channels to social media for people to understand what benefits and what kind of investments can improve their day to day lives. This also may call for a culture of connecting people among legislators and officials. If the Prime Minister can spare time every month to talk to the nation, why can’t our people’s representatives interact with their constituents more formally and visibly?

Some of the activities taken up by the BJP government though appear to be under operational efficiency, they in fact reinforce the access based position. The JAM Trinity not only helps plug subsidy leaks, but directly delivers benefits to persons targeted. Insurance schemes call for participation of individuals and strengthen element of choice in policy formulation.

We can further this process by replacing subsidies using flexible social benefit plans so that people can access benefits they need rather than as a matter of entitlement. This position can be further deepened by targeting the ‘personal sector’. Delivering benefits to individuals as per individual needs instead of making decisions at the community level, where the undeserving may get benefits. Focus on personal dimension means underplaying pressure groups and vote banks.

So the BJP should create a strategic position within the Indian Polity where

- It aims to meet common needs of all people whether it is cleanliness, Make in India, Digital India or encouraging entrepreneurship. Making ‘Development as a mass Movement’ is a key corner-stone of this position.

- It targets and aims to grow a constituency of voters who appreciate that ‘Achche Din’, ‘Sachche Din’ and ‘Surakshit Din’ have to operate in tandem. A constituency which realizes the importance of a united and strong nation. This position means not yielding to pressure groups and zero-tolerance for corruption and terror. Earlier consensus on the soft state, soft target and soft approaches for every issue needs to be challenged. National consensus should be questioned not only in the social sector but also in sectors like agriculture where despite years of good intentions, it has not picked up.

- It connects with people much more comprehensively for matters of governance as well as politics, aims to boost the personal sector thereby unleashing personal initiatives, and keeps ‘individuals’ at the center of our national discourse. This means castes, communities and vote banks should be underplayed.

Shreekanth M Prabhu has around 25 years of experience in industry, spanning TCS, IBM and Hewlett Packard.  He is currently working as an Associate Professor in PES Institute of Technology, Bangalore. His research interests include Social Computing, Data Science and E-Governance.

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