• sunilscga@gmail.com

One suicide, one tweet and ease of doing business

One suicide, one tweet and ease of doing business

Real estate developers in Mumbai are facing the real crisis. Most of the developers are under heavy debt. Project approval delays are well-known. With some 28 plus approvals from various Govt. authorities, one can imagine the time it takes and money involved.

On top of this sluggish market since last few years and heavy overheads. It is survival at stakes situation for many of the small and mid-size developers. When the market can’t absorb the cost and cost is high, the company fails. Here it is a question of an entire industry. We have seen suicide by a well-known developer in Thane yesterday – courtesy; prolonged time for Govt. approvals and heavy debt.

The subject of discussion is not real estate industry, but ease of doing business or rather how it is extremely important, making it easy for entrepreneurs to do business for speedier economic development. Definition of entrepreneurs does not mean only start up, but already stated too.

On one hand, we are struggling with low economic growth and poverty and on the other we have so many hurdles and impediment for wealth creators i.e. entrepreneurs. Unfortunately, most of these impediments are man-made. Be it outdated laws, excess of laws, unclear policies, excess approvals, delay in decision making, corruption and what not.

We are not growing, but we can’t let it free. Government and industry want growth, but enabling infrastructure is in doldrums. Mr. Finance minister every now and then makes statement India can grow double digit but how, when, action taken, ground level changes????

India fares 142 in ease of doing business. The picture is not so good at a company level. Companies which want ease of going business from Govt are equally culprit for making it difficult for their customers to deal with it.

Report on the economic impact of doing business found;

  • In Mexico one study found that a program that simplified municipal licensing led to a 5% increase in the number of registered businesses and a 2.2% increase in wage employment, while competition from new entrants lowered prices by 0.6% and the income of incumbent businesses by 3.2%.25 Other research found that the same licensing reform directly led to a 4% increase in new start-ups and that the program was more effective in municipalities with less corruption and cheaper additional registration procedures.
  • In India the progressive elimination of the “license raj” led to a 6% increase in new firm registrations, and highly productive firms entering the market saw larger increases in real output than less productive firms.27 Simpler entry regulation and labor market flexibility were found to be complementary. States with more flexible employment regulations saw a 25% larger decrease in informal firms and 17.8% larger gains in real output than states with less flexible labor regulations.28 The same licensing reform led to an aggregate productivity improvement of around 22% for firms affected by the reform.
  • In Colombia new firm registrations increased by 5.2% after the creation of a one-stop shop for businesses.
  • In Portugal, the introduction of a one-stop shop for businesses led to a 17% increase in new firm registrations and 7 new jobs for every 100,000 inhabitants compared with economies that did not implement the reform.

Recently, when Modi Govt completed nine months in office Mr. Deepak Parekh, Chairman, HDFC commented his displeasure about the ease of doing business initiatives. Interestingly Mr. Suhel Seth tweeted about this comment of Mr. Deepak Parekh. In response to Mr. Seth’s tweet what people have responded speaks many things:


In my book The Bread is Moving I have stated;

The above comment by Mr. Deepak Parekh and response by the Tweeple indicate a few things:

  • Ease of doing business is important
  • Ease of doing business is equally important at company level for its customers
  • Most entrepreneurs are not aware about the status of the ease of its customers
  • When any business leaders speak on any matter, she must be prepared for the backlash
  • Immediate response to negative comments about the brand is necessary by the company in a social world we now live in

This happens when a country and a company is not focusing on citizen and customers while designing its processes and systems. While designing any system or process customer centricity must be the focus. Failing in this will result in unpleasant experience and delay in work.

Ease equals to speed. Speed equals to faster results and outcomes. However, enormous vested interest, outdated norms, and work culture has made doing business a nightmare in India. The present Govt is trying to dismantle many outdated laws. World ease of doing business ranking has improved by 15 points.

There is an interesting book called The Effortless Experience which talks about making the experience of the customers effortless. It has a measurement matrix which measures customer effort score.

“You need to give your customers fewer reasons to be disloyal, and the best way to make that happen is to reduce customer effort.”

― Matthew DixonThe Effortless Experience: Conquering the New Battleground for Customer Loyalty

Making it easy is a business driver. Countries make it for its entrepreneurs and entrepreneurs make it for their customers. 96% of high effort customers become disloyal and 67% of the high effort customers become detractors.  The high effort is stressful and can be a loss making a proposition in competing markets.  A country will lose investments and a company loses customers.

We have seen social media impact of high efforts in the picture above. Every brand is exposed to social media and customers are very vocal on social media. Making it easy should be the top priority for everyone. Use technology or single window time-bound approvals, dismantle outdated laws and norms or reduce the number of punches while dealing with call centers.

Do whatever, but EASE is the way. Whether it’s a real estate industry or license for vegetable vendor high efforts equals to slower economic growth. When customer experience is so important for loyalty, focussing on EASE of doing business can have substantial bottom-line impact.

Want to focus on battering customer experience, focus on ease of doing business and effortless experience. Want to focus on the growth of an economy or a business focus on ease of doing business and effortless experience, want to improve business bottom-line and GDP, focus on ease of doing business and effortless experience.

India knows its world ranking on ease of doing business index. What is your company’s customer effort score?

Want to know more about the ease of doing business and building effortless experience read the ebook The Bread is moving.

Sunil Gandhi
Sunil Gandhi

Leave a Comment