Tuesday, August 25, 2015

The One-Dollar Haircut

Every year, I travel more than 9K miles to my native place in Tamil Nadu, India, to get my $1 haircut.
(pic source: http://jhingu.com)

The local barber is an expert and does it the old-fashioned way. A comb to sift, and super-quick scissors acting as efficient cutting planes to produce a nice, convex-hull hairdo. No fancy machinery, seating, lighting, or A/C in his environment-friendly shop, and not a single nick, or hair out of place when he's done. This keeps his customers happy and operating cost low. It's a dollar regardless of crop density. Perhaps the argument is that for the sparse-headed, the cost of searching goes up even as the actual cutting time reduces. If the shop is full, spill-over customers can sit in makeshift chairs outside the shop, and sip chai from the adjoining 'tea-kadai'.

The Indian barber shop is also an instance of the 'elastic' capacity model that is key to understanding how the Indian economy has chugged along. Here is what Prof. R. Vaidyanathan, Professor at the Indian Institute of Management, Bangalore, in his superb book 'India, Uninc' has to say:

Data shows that it this 'unincorporated' economy built from the ground-up by entrepreneurs that is responsible for much of India's GDP and employment, and not the stock market that grabs headlines. Despite the recent crash of the global markets, the Indian elephant is likely to remain solid, like it did after 2008.

The traditional Indian way of doing business may be initially bewildering to the external observer, which may have led to this 'Uninc' being categorized by Nehruvian India's west-educated officials as "unorganized". Actually, it is anything but, and appears to be based on balancing constraint-enforcing 'order' and constraint-relaxing 'chaos'. This traditional Indian approach, which I personally view as dharmic optimization, yields astonishingly high and sustainable levels of quality and efficiency when done right, but can also be disastrous when either order or chaos is excessive.

End Note: Apparently, the global wig supply-chain sources much of its hair from India.


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