The bottomline is …… not profit!

Sometimes some seemingly trivial conversations strike a chord with us and stay with us forever. One such conversation I had was with Christina Chongthu, IAS, and then the MD of the Telangana State Tourism Development Corporation (TSTDC). I was part of a team that was working with TSTDC to help them improve the profitability of their transport fleet. I was presenting the recommendations based on extensive field work and data analysis done by our team. One of the recommendations was to increase the prices for one of the tourism circuits from Hyderabad to a prominent religious destination in Maharashtra as (a) demand was very high for that tour, and (b) private operators were charging much higher for the same tour. She very politely asked me a question, “What do you think is the purpose of running this fleet?” Before I could think and react, she gave away the answer, “TSTDC is not running these buses to earn profit, but to serve the poor citizens of the state who can’t afford the private buses. While we do want to minimize the inefficiencies and leakages to improve the profitability, the objective is not to maximize the profit, but to maximize the welfare.” Needless to say our final presentation to the Chief Secretary of the state included a number of recommendations that were well received and implemented in due course of time but increasing fare was not one of them!