How do you deal with conflicts at work?

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By Somali K Chakrabarti

How would you feel if, on a particular day when you plan to leave office somewhat early, your manager calls up and asks you to complete an urgent piece of work?  Alternatively, as a manager when you ask your subordinate to collate information that you need to plug into an important report and follow up after some time only to realize that your team member has not even started working on it.

Conflicts are a reality of life! Whether you like it or not, in your day to day life, you would invariably come across several conflicting situations, both in office and at home. Your response to dealing with such conflicts often depends on your personality, your tendency to assert yourself, or to impose your viewpoint, or to adjust with others.

Conflict 1If you are in a habit to always assert yourself or one of those who wants to prove their point at all times, you may end up expending a lot of time and effort in dealing with conflicts. On the other hand, if you worry too much about a conflict then you will be discontent, frustrated and feel demotivated. That will hamper your productivity at work.

The most pressing types of conflicts are those arising due to differences in personality. Then there are conflicts due to differences in style of work, due to interdependence on each other for work and differences in emotional and cultural background. Whatever is the nature of the conflict, ignoring it in the hope that it will go away rarely helps.

An awareness of different styles for managing conflicts can help you to selectively pick your battles and fight for those that matter the most.

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Bottlenecks plaguing the coal sector in India

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Bottlenecks in the coal sector in indiaThe import of coal has been one of the significant factors contributing to the Current Account Deficit (CAD) in India that touched 4.8 per cent (approx USD 88 billion) of India’s Gross Domestic Product (GDP) in 2012-13 period. Rising imports, coupled with fall in value of rupee, resulted in a drain of foreign exchange from the country. It is surprising to note that although India has the fifth largest reserves of coal in the world totaling up to 235 BT in 2011, the gap between production and consumption of coal has been increasing over the years from 72 MT in 2009 to 82 MT in 2011.   India imported around 135 MT of coal in the 2012-2013 and is currently the second larger importer of coal after China.

Here we look at some of the issues pertaining to the coal sector in India.

Issues related to import of coal

India needs to import substantial amount of coal from countries like Australia, New Zealand, South Africa and Indonesia. Indonesian coal accounts for a bulk of India’s thermal coal imports, while steel-making coking coal is imported largely from Australia and South Africa. Owing to the increase in environmental concerns, coal exporting countries such as Indonesia imposed coal tax and Australia levied carbon tax in 2012.  The imposition of taxes increased the cost of coal for the plants in India that are especially designed to use imported coal, This resulted in power producing  companies such as Tata Power and Adani Power to demand for rate revision in their power purchase agreements (PPA). However the government upheld the PPA, while agreeing for a temporary upward revision in price in some cases.

Issues related to domestic production of coal

Domestic production of coal is beset with challenges both in terms of quality and quantity. Problem of quantity relates to environmental, rehabilitation and technological issues in opening up of new mines and in increasing recovery from currently operating mines. Sustainable solutions are needed to address the environmental and rehabilitation concerns. Since most of the coal deposits lie underneath forests and tribal regions, mining requires felling of forest and resettlement and rehabilitation of affected people. Mining in such areas, if left uncontrolled, can cause environmental and social havoc. Environmentally sustainable mining is costly which is bound to reflect on the cost of electricity. Increasing prices of electricity is as much a political decision as a business one.

By and large, domestically produced coal has problems associated with grade and ash content. The Indian coal mines produce coal that has higher ash content, and hence more impurities which increases the cost of cleaning. High ash content imposes a limitation to that coal being used in metallurgical processes. Around 70% of the coal in India is used to produce power and around 7% of the coal is used in the steel industry. Though the high ash coal can be used in power plants, but it produces substantial quantity of ash (both solid and fly), thus increasing the costs associated with cleaning and storing such ash. Additionally plants have to invest in capturing fly ash to adhere to flue-gas emission standards. Some older power plants also have limitations of space required for disposing ash. High ash content increases the cost of transportation per unit energy value of the fuel, further increasing the cost of production of electricity and metallurgical process. There are technological issues associated with plants which have been designed to work on lower ash content. Local coal needs to be blended with imported low ash content coal for use in such plants.

Coal India Ltd (CIL) is the only public sector company that mines and sells coal in the local market. In addition some companies like steel and power companies have their captive mines. Of late, due to supply constraints, CIL has not been able to fulfill the domestic requirement of power plants, after entering into Fuel Supply Agreements. Further, FSAs are waiting to be signed with many other power companies that are under development or have been awarded permission to set up new power plants. Domestic coal demand touched 772.84 million tonnes (MT) during 2012-13 period whereas production was at 557.60 MT. In the wake of the local shortages, coal imports have been increasing and are projected to increase further.

Issues related to government policy on coal allocation

In 2012, the policy of the Government of India on allocation of coal blocks came under scanner due to allegations by the Comptroller and Auditor General of India (CAG) office, accusing the government of allocating coal blocks in an inefficient manner during the period 2004–2009. In spite of the government’s policy to open coal sector to private players, the coal allocation has been ineffective and has created a situation where coal is not available to power generators as and when required. On one hand few generators are occupying huge mines, whereas the newer ones are not able to start mining as they still haven’t got the mandatory clearances.

This has put the burden for supplying coal on CIL, the sole public sector coal producer. Current slowdown in the economy has adversely impacted the power producers as plant load factor (PLF) has reduced and short-term power rates are depressed. Rupee’s slide against the dollar has further driven up the cost of imported coal. The Indian buyers of coal are unwilling to shoulder the additional cost burden, and have cancelled contracts or sought to renegotiate contracts, causing coal cargoes to pile up at Indian ports. As nearly 60 % of country’s electricity generation is from coal-based plants, better power prices would have incentivized power producers to purchase costlier imported coal for generating more power.

All these factors have added to the increase in demand and supply gap, and have been deterrents in the country’s progress towards energy sufficiency.


 Related articles

 

  • India likely to be the largest coal importer in 3-5 years
  • Stop the Destruction of Indian Rainforests for Coal Mining (forcechange.com)
  • How sustainable is coal mining in India
  • Indonesia’s 25% tax plan on coal exports to hit Indian power firms

Core of a Business

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We know that firms need to adapt their strategies as per the changes in the business environment.

Strategies are highly context specific.

What was good five years back will not hold good now. The business model that works for a particular firm may not work in a similar manner for another firm. The strategy that pays off in one country may not produce similar results in another country. While responding to the changes in the environment, sometimes companies have even moved away from their core business.

  • Today, Nokia is a world leader in digital technologies, including mobile phones, telecommunications networks, wireless data solutions and multimedia terminals. You would be surprised to know that Nokia started with a wood pulp mill in Finland as a manufacturer of paper. The company later went on to manufacture rubber bands, industrial parts and raincoats. After World War II they expanded into Electronics and then into telecommunications.
  • HP’s first product was an audio oscillator – an electronic test instrument used by sound engineers. They shifted to computers, printers, servers & imaging products.
  • Reliance Industries Limited (RIL) started as a textile manufacturing business in 1966, and is one of the world’s most vertically integrated and horizontally diversified group with a wide range of businesses such as retail, telecom, textiles, petrochemicals, infrastructure development, etc. RIL sold off its textiles business and its ‘Only Vimal’ brand in 2012.

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Alternately there are businesses that diversify into other areas while retaining their core business.

  • Indian Tobacco Company ITC has diversified from its main business of cigarette into various other businesses like FMCG, lifestyle retailing,  stationeries, hotels, paper businesses, and agriculture products.
  • IBM started as a computing, tabulating & recording company in 1880s, moved to PCs in 1980s , to integrated solutions and consulting servicers.
  • Pepsico has broken out of confines of cola drinks to become one of world’s most successful suppliers of drinks, snacks and breakfast cereals. Pepsico had diversified into restaurant business after acquiring Pizza Hut in 1977, Taco Bell a year later, and Kentucky Fried Chicken in 1986. But these acquisitions failed to live up to expectations of the shareholders, as Pepsi began losing ground to Coca Cola in the soft drinks. In 1997 PepsiCo decided to spin off its under-performing restaurants and Yum brands was created.  PepsiCo has since expanded to a broader range of food and beverage brands, the largest of which include an acquisition of Tropicana in 1998 and a merger with Quaker Oats in 2001, adding with it the Gatorade sports drink to its portfolio.

So we see that the core of a business need not necessarily be static. It can very well be a moving target. 

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