Kanika Datta: Can India Inc deliver social service?

SWOT

Finance Minister P Chidambaram thinks he has found a possible solution to the chronic problem of poor delivery mechanisms for social infrastructure in India: involve the private sector.

As he told the Confederation of Indian Industry's post-Budget gathering with restrained drama, "I ask you to send your young executives for two or three years. It might involve a financial sacrifice. We will pay them what the government can afford to pay. You can top it up with some money."

The suggestion sounded great; it's the ultimate "private-public partnership", the term that is so much in vogue these days. But I would be willing to bet that it is unworkable and more public money will end up being thrown after bad.

This is not because corporate India would be unwilling or lack the high-mindedness to assign executives for such prima facie noble causes.

Indeed, there are many corporate groups that contribute generously and effectively of their time and money to social work. So why do I think this delivery-mechanism solution will be unsuccessful? Because of a collective corporate failing: the near-absence of the concept of service and efficient service delivery.

India Inc has certainly made some impressive strides in the 13 years since liberalisation in terms of manufacturing efficiency, productivity and growth "" the entry of three more Indian corporations to the Fortune 500 list on Tuesday is testimony to that.

But it is fair to say that the quest for growth and expansion has not been matched by optimal service delivery, despite India's growing reputation as a global hub for IT services.

To understand this better, think of any good or service you have bought from a private sector company in the recent past: a car, credit card, cellphone, computer, broadband, a home loan, electricity connection and so on and so forth.

Think again: have you been satisfied with the service that accompanied these purchases? Even a dipstick survey among colleagues in Business Standard's Delhi office suggests that the answer is a resounding no.

Everyone had complaints, some of them serious, some of them absurd. There is the cellphone service customer care exec who told a colleague requesting "" for the nth time "" a reconnection of outgoing calls that he was "taking too much advantage of being a customer". There is the service engineer of a broadband company who could not provide services to a new office despite demanding payment in full.

The home loan company that took five reminders, including an office visit, to record a change of address. The service contractor for a computer hardware company that could not fix a fault "" for months. The credit card company whose credit card never arrived. The electricity vendor whose linesmen never turn up...

The list not only goes on and on "" I am sure readers will be happy to add to it "" and it includes some big names in corporate India. Significantly, not all of them are Indian corporations either, multinationals are no less accountable.

What have all of these consumer complaints got to do with private sector participation in bringing sanitation, water, health-care, education and food to India's poor?

The short point is this: if corporations in India cannot deliver optimally on services that involve fully paid-up commercial transactions that are backed by expensive infrastructure and resources how can they possibly help the government deliver public goods in circumstances that are far more challenging?

Delivering social services is not the same as hard-selling a car or a credit card; it requires an attitude to service that must be ingrained. In this respect, it is hard to see what expertise a corporate executive can provide the government that a talented bureaucrat "" of which India has no dearth "" cannot.

In a strange way, the problem is a legacy of our political economy. As long as the government dominated commercial activities and competition was restricted service was a non-issue simply because corporations did not have to compete too much.

That is why for Indian marketing and sales executives, the commercial relationship tended to end with the sale and old habits die hard, as the cliche goes. Things are changing "" you only have to look at the way the automobile and IT industries are developing to understand how "" but not enough to turn the private sector into a model of service efficiency yet.

The finance minister is right in suggesting that civil society needs to be more engaged with India's social problems. But equally, India needs a lot more competition to teach the private sector the art of effortless service before its corporations can contribute meaningfully to the kind of partnership Chidambaram has in mind.