Sunday, February 18, 2007

Understanding Mergers, Marriages & Mishaps

Ok, all those happy bachelors who are in no hurry to get on this side, unhappy bachelors who are desperate to get on the other side, unhappily married men who want do a RCA (root cause analysis) of their miserable state and the rapidly vanishing breed of happily married men who are curious to understand why they have been chosen to stay happy; here are some of the answers.

It’s probably no coincidence that the Tata Group which has been, of late, on a merger spree has a bachelor chairman. Sure that was tongue-in-cheek, but it’s more than likely that corporate mergers and social mergers have a lot in common and by extension failed mergers and broken marriages are alike in more ways than one. Let me add a couple of disclaimers here. Firstly this post is a male point of view (isn’t that obvious?), hence it’s not meant to be construed as anti-feminist. Secondly, this post is a positive statement, not a normative one (for the uninitiated, ‘the way the world is rather than the way it should be’)

Let’s look at the Indian scenario first. For centuries men in India married purely for the purpose of outsourcing some of their functions such as household work, rearing children etc. and it was believed for long that men had a comparative advantage in terms of earning livelihood. Now this model worked for a variety of reasons; there was tremendous social pressure that kept it that way, both partners did not compete for the same resources (there was an implicit non-compete agreement), so it became in some sense, an evolutionarily stable strategy. Things changed, of course primarily because of increasing complexity in the environment and the institution of marriage as it exists now in India is akin to the Jurassic Park , which could collapse (or mutate) because it is, in the words of Ian Malcolm, the chaos theorist, ‘ an unsustainably simple system forced bluntly upon an incredibly complex system.’ In corporate terms the relationship was more on client-vendor terms, clearly putting man in a stronger negotiating position. Now of course vendors have upgraded and evolved, thereby changing the balance of power significantly. Now you have co-sourcing and partnership models which again mirror the changes in the social world, vendors (and wives) increasingly participate in strategic decision- making.

Let’s look at mergers (and therefore marriages) from another perspective- one of the most (mis)used terms in MBA lingo- synergy. I wont dwell at length on the corporate ones except to say that shareholder viewpoint is often marginalized before empire building and agency issues and the often-quoted reason of ‘diversification’ for mergers is often a dumb one since the shareholders can themselves diversify at much lower transaction costs. Let’s look at the more interesting parallel in the social world. We have heard this before; for example marry a partner who’s from a different industry, so as a unit, your risk is diversified. Sure your risk is halved, but so are your rewards. But there are better ways to diversify your risk; all you have to do (after considering other things) is to invest in a sector which has no correlation with the sector you are working in. Child rearing is an issue, I agree, but there is already an increasing trend towards a single-parent model. I am not sure if there is enough empirical evidence to suggest that children reared in single parent homes are worse off than the rest of us. Assume that on an average partners fought 1/3 of the time, were very happy 1/3 of the time and did nothing for the rest of the time, I am reasonably certain that the expected impact on the child, on average is same as living in a single parent home where there was no upside, sure, but there was no downside either. Sure, my thought experiment made some assumptions, but I don’t think I am way off the mark.

So do I see an equivalent for the on-demand (pun intended) model emerging in the social world? Sounds attractive conceptually, but then, who knows? I’m no Alvin Toffler.

11 Comments:

Blogger Siva Prashanth said...

Well, an erudite comment on the 3M Inc. :)..To add further"irreverance" to your post, guess which was the mail that followed yours into my Inbox.. ;).. The CHILD CARE CENTRE MAIL from IBM.. :D So do we take that as another positive for your 3M theory..Well, who knows.. :)

Not too sure abt the evolving "single parent model"...

Now that I am definitley the first to post, WITFM??.. :)

11:48 PM  
Blogger Ravi Ivaturi said...

well, that's a positive for sure. If IBM, in future, moves up the value chain (from child to partner level); that will have interesting ethical/moral implications. And about your WITFM, yes, you will have your answer soon enough.

11:56 PM  
Blogger Santosh said...

After your initial disclaimer, I doubt if the fairer sex don't come up with innovative ideas of why they could not read your post.

But as a happy bachelor not in a hurry to commit suicide, I'd say you hit the point about Mergers and Mishaps.

As for the Single Parent Model, atleast in India, it is still god-forbid, "On Demand".

Following Siva... WIIFM?

11:52 AM  
Blogger salvagepoint said...

Looks like the male-brigade is having a field day!
And therein lies the problem - men in general tend to view marriage and all relationships as corporate mergers/business transactions and not for what they truly are - simple matters of the heart which need to be dealt with tenderness.

But then again, am not as acquainted with the kind of mergers you're mentioning!Perhaps I should read your post in another 10 years and see what I feel about it...

5:46 PM  
Blogger Ravi Ivaturi said...

@Siva & Santosh: Re WITFM, 'the simple pleasure of knowing that you did something good'

@Salvagepoint: So finally the Woman's point of view is salvaged (pun obviously intended.) Well, social relationships arose in the first place to ensure survival, so it would be interesting to study them as though they were business transactions-the reason being business transactions have explicit payoffs and costs. And the unit of currency in social relationships is not money, so it's not as scandalous as it appears to be. In the Darwinian world, winnings are paid out as offsprings. Well, I will touch about that in a different post, may be.

6:40 PM  
Blogger srinivas said...

it was fun to read this post. i am reminded of the blind man and the elephant story. do you really believe what you wrote (about this post only i am asking please) or it is just fun?

8:28 PM  
Blogger Ravi Ivaturi said...

@Srinivas

Since I know you, I am going to assume that you asked me a serious question. Do I believe in what I have written? About the way marriage exists in India- you bet. The average Indian husband is still an MCP (Male Chauvinist Pig); mark my emphasis on ‘average’. About the future, who knows? Here your example of ‘blind men and the elephant’ is spot on. Substitute your elephant with future and it would be obvious that everybody, without exception, is blind to the future. Since we don’t know, we estimate using a variety of tools; which vary from studying planetary movements, gazing cross-eyed into crystals, looking for doomsday predictions in religious texts, taking opinion polls, using computer simulated game theory models in anthropology etc. All I did was to use a non-conventional lens to explore the institution of marriage and I thought it threw up some interesting insights, that’s about it.

5:54 AM  
Anonymous Vaibhav said...

Only a great mind can come come up with such noble thoughts :-)

Salutations to the Don!!!

9:52 AM  
Blogger Ravi Ivaturi said...

Thanks Vabs, I do my 'bit' for my country and planet.

10:45 AM  
Blogger neelasa said...

Little too late to post a comment????

Was wandering aimlessly and came accross your blog.

Loved your post...
Not sure about the 'single parent model' either.

btw,just out of curiosity, whats the "blind man and the elephant story", If I may ask?

2:08 AM  
Blogger Ravi Ivaturi said...

@Neelasa: Thank you. Iam not sure about the 'single parent' model either. All I am saying is proponents of Parents>1 model dont have any emperical evidence that their model is the 'best' model. The elephant-blind men story is about 7 blind men who touched different parts of the elephant and concluded that the animal was 'only' trunk/tail/legs etc . A moral lesson in myopia :-)

12:12 PM  

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