If the case study by IIM-Ahmedabad is anything to go by, Railway Minister Lalu Prasad Yadav's strategy to bring about a turnaround in the loss-making Indian Railways is worth applauding. The study concludes that the Railways has emerged as a “sunrise sector” with a potential to attain “world-class” standards if it sustains its current level of performance.
Yadav was lauded for his “common sense-based approach” which displayed an astute understanding of market reality, the asset base of the Railways and the expertise and capability of its management and systems. “Consequently, he followed it up with the principles of leveraging the assets (“milk the cow fully”) and empowerment and delegation. With whatever has been achieved in the turnaround, Lalu has demonstrated that good economics is good politics,” states the report by Prof G. Raghuram.
At a presentation of the report by Raghuram on Wednesday, a beaming Yadav declared that the best was yet to come and he had grand plans for transforming the Railways into a money-spinner that would contribute significantly towards the country’s economic prosperity. “Like a Jersey cow, the Indian Railways too has tremendous potential. It will make tremendous profits to fill the nation’s coffers in the days to come,” he stated.
Yadav said he was looking forward to share the details of his strategy with the students of IIM-A, where he has been invited to deliver a lecture on September 18.
While expressing appreciation for the overall strategy employed in toning up the Railways’ functioning, which could be sustained over the coming years, Raghuram, however, noted in his critical appraisal that there was scope for further improvement. He asserted that the top management of the Railways needed to be more commercially-oriented and develop a corporate culture.This would need a restructuring of the Railway Board, the apex governing body of railways, with a redefining of the functions of various members on it. The policies and strategies adopted by the Railways had to be more “customer-centric” with regular feedbacks from its clientele, he said.