Sociocracy - Future of Organisation Management

We have learnt a lot about OB (Organization Management) during MBA classes. I remember a course I took at Keenan Flagler Business School was about roles and behavior in groups especially in business settings. This theory and practice form the basis of our basis of understanding of the so called "IDEAL ORGANISATION BEHAVIOR"

But this ideal OB has some inherent problems such as

1. Most of the things are driven from the top
2. Most of the people in the middle and lower ranks feel themselves as dis-empowered
3. Job descriptions are very rigid and people have little flexibility around them
4. People at the lower hierarchy feel that some of the decisions are not transparent. 

All this rigidity leads to issues in re-organisation or any change in the Structure of an organisation. Lack of transparency is more dangerous as this leads to - "SENSE OF DETACHMENT WITH ORGANISATIONAL GOAL". This is equivalent to "Sense of detachment from society" in sociology, which Durkhiem has famously coined as "ANOMIE"

Our large business organisation are not able to show effectiveness of  a startup due to this "Condition of Anomie" as described by Durkhiem.

But the solution to this lies more in something propagated by Weber in his organisation structure theory, but albiet on foundation of "Sociocratie" as coined by Auguste Comte, the father of sociology and my favorite among sociology thinkers.

1. Organisations have to structure themselves around roles
2. There should be complete autonomy within a role in terms of execution and implementation
3. Individual should be detached from the role he is handling

Individuals have to be replaced by the roles they do and the organisation itself has to be divided into a overlapping circles. This is something similar to "Organisation of Religious order", something similar to Hinduism. People (akin to roles) follow a religion, but they are independent to execute their form of worship. When I say, religion, it is more of a "loosely defined religion like hinduism / Cristianity" than as a "strictly defined religion such as Islam, which has very strict punishment for even those who leave it or dare to say anything about their god, even a picture or physical description".

NCR Real Estate market set for a crash landing with KMP

Palwal Manesar stretch of KMP is going to be inaugurated. What will be side effects

1. It will lead to a lot of supply of real estate in new areas such as Jhajjar / Bahadurgarh
2. It will make the hinterland of Najafgarh approachable from a new dimension altogether
3. L-Zone will become attractive as it will surely be connected to KMP in future

All this will lead to a supply glut in already over-supplied market leading to ultimate crash of rates in sectors such as Gurgoan, Noida etc.

Shocking PE of Kotak Mahindra and fallacy of Dividend Pundits in India

Castles in air are not built over night. It seems that the story around Kotak has taken a bit of time to build.

There is no denial to the fact that Kotak is perhaps best bank in India. They are also well placed to grow faster than almost everyone.

But then a PE of 60+ does not stand the test of reasonableness.

Another BS which one hears a lot now a day is the "Dividend should guide your stock selection". YES, this is correct, but not in India

Consider this, imagine EBIDTA of 100, then 33 as profit tax (assuming no depreciation), to declare dividend the company pays, 17% DDT
PAT = 67
CF to shareholder after Div = .83*67 = 55 (approx)

So, effectively the company is destroying value by declaring dividends, it is literally handing over the money to the "Government of India" not to the shareholders.

So, in a country like India, declaring dividends is not very wise steps. Then there are companies, which have found ways around. I have identified couple of these small and mid caps.