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By:

Rashmi Kulkarni

23 March 2025 at 2:58:52 pm

Loss Aversion Is Why Your Good Idea Fails

Your upgrade is their loss until you prove otherwise. Last week, Rahul wrote about a simple truth: you’re not inheriting a business, you’re inheriting an equilibrium. This week, I want to talk about the most common reason that equilibrium fights back even when your idea is genuinely sensible. Here it is, in plain language: People don’t oppose improvement. They oppose loss disguised as improvement. When you step into a legacy MSME, most things are still manual, informal, relationship-driven....

Loss Aversion Is Why Your Good Idea Fails

Your upgrade is their loss until you prove otherwise. Last week, Rahul wrote about a simple truth: you’re not inheriting a business, you’re inheriting an equilibrium. This week, I want to talk about the most common reason that equilibrium fights back even when your idea is genuinely sensible. Here it is, in plain language: People don’t oppose improvement. They oppose loss disguised as improvement. When you step into a legacy MSME, most things are still manual, informal, relationship-driven. People have built their own ways of keeping work moving. It’s not perfect, but it’s familiar. When you introduce a new system, a new rule, a new “professional way,” you may be adding order but you’re also removing something  they were using to survive. And humans react more strongly to removals than additions. Behavioral economists Daniel Kahneman and Amos Tversky called this loss aversion where we feel losses more sharply than we feel gains. That’s why your promised “future benefit” struggles to compete with someone’s immediate fear. Which seat are you stepping into? Inherited seat:  People assume you’ll change things quickly to “prove yourself”. They brace for loss even before you speak. Hired seat:  People watch for hidden agendas: “New boss means new rules, new blame.” They protect themselves. Promoted seat:  Your peers worry the old friendship is now replaced by authority. They fear loss of comfort and access. Different seats, same emotion underneath: don’t take away what keeps me safe. Weighing Scale Think of an old kirana shop. The weighing scale may not be fancy, but it’s trusted. The shopkeeper has used it for years. Customers have seen it. Everyone has settled into that comfort. Now imagine someone walks in and says, “We’re upgrading your weighing scale. This is digital. More accurate. More modern.” Sounds good, right? But what does the shopkeeper hear ? “My customers might think the old scale was wrong.” (loss of trust) “I won’t be able to adjust for small realities.” (loss of flexibility) “If the digital scale shows something different, I’ll be accused.” (loss of safety) “This was my shop. Now someone else is deciding.” (loss of control) So even if the new scale is better, the shopkeeper will resist or accept it politely and quietly return to the old one when nobody is watching. That is exactly what happens in companies. Modernisation Pitch Most leaders pitch change like this: “We’ll become world-class.” “We’ll digitize.” “We’ll improve visibility.” “We’ll build a process-driven culture.” But for the listener, these are not benefits. These are threats, because they translate into losses: Visibility can mean exposure . Process can mean loss of discretion . Digitization can mean loss of speed  (at least initially). “Professional” can mean loss of status  for the old guard. So the person across the table is not debating your logic. They’re calculating their losses. Practical Way Watch what happens when you propose something simple like daily reporting. You say: “It’s just 10 minutes. Basic discipline.” They hear: “Daily reporting means daily scrutiny.” “If numbers dip, I will be questioned.” “If I show the truth, it will create conflict.” “If I don’t show the truth, I’ll be accused later.” In their mind, the safest response is: nod, agree, delay. Then you label them “resistant.” But they’re not resisting change. They’re resisting loss . Leader’s Job If you want adoption in an MSME, don’t sell modernization as “upgrade”. Sell it as protection . Instead of: “We need an ERP.” Try: “We need to stop money leakage and order confusion.” Instead of: “We need systems.” Try: “We need fewer customer escalations and less rework.” Instead of: “We need transparency.” Try: “We need fewer surprises at month-end.” This is not manipulation. This is translation. You’re speaking the language the system understands: risk, leakage, blame, customer loss, cash loss, fatigue. Field Test: Rewrite your pitch in loss-prevention language Pick one change you’re pushing this month. Now write two versions: Version A (your current pitch): What you normally say: upgrade, modern, efficiency, best practices. Version B (loss prevention pitch): Use this template: What are we losing today?  (money, time, customers, reputation, peace) Where is the leakage happening?  (handoffs, approvals, rework, vendor delays) What small protection will this change create? (fewer disputes, faster closure, less follow-up) What will not change?  (no layoffs, no humiliation, no sudden policing) What proof will we show in 2 weeks?  (one metric, one visible win) Now do one more important step: For your top 3 stakeholders, write the one loss they think they will face  if your change happens. Don’t argue with it. Just name it. Because once you name the fear, you can design around it. The close If you remember only one thing from this week, remember this: A “good idea” is not enough in a legacy MSME. People need to feel safe adopting it. You don’t have to dilute your standards. You just have to stop selling change like a TED talk and start selling it like a protection plan. Next week, we’ll deal with another invisible force that keeps companies stuck even when they agree with you: the status quo isn’t a baseline. It’s a competitor. (The writer is CEO of PPS Consulting, can be reached at rashmi@ppsconsulting.biz )

It’s Time to Change the Direction of Agricultural Research

The future of agriculture depends not on controlling the climate but on adapting smartly to it.

In Maharashtra — especially in Marathwada, Solapur, Jalgaon, Ahilyanagar, parts of Vidarbha, and some talukas of Pune — unprecedented September rains caused massive destruction. Nearly 69,000 hectares of farmland were flooded, damaging crops like cotton, soybean, maize, pulses, vegetables, sweet lime, sugarcane, banana, mango, and grapes, with riverbank sugarcane fields worst hit.


Earlier, climate change mainly caused crop losses; this year, farmlands, wells, ponds, and livestock were also destroyed — a double blow. It is now clear that agricultural research must change course to better address such crises.

 

The changing climate

Climate change, driven by global warming, has brought delayed and shorter monsoons, long dry spells, fewer but heavier rains, cyclones, untimely harvest showers, hailstorms, milder winters with sudden cold waves, record heat, and erratic humidity. Though such patterns always existed, their frequency and intensity have surged since the early 21st century, now threatening farmers’ livelihoods and the future of agriculture.


Agriculture in Maharashtra is mostly rain-fed, with over 80% of farmers being small or marginal. Nearly a third of the state lies in a drought-prone rain-shadow zone. About 64% of its land has shallow to medium soil, and only 36% is truly fertile, keeping crop yields below the national average.For decades, the climate remained stable—monsoon, winter, and summer followed predictable patterns, allowing farmers to maintain consistent crops, livestock, and farming systems.


After Independence, India built a robust system of agricultural education and research, achieving self-sufficiency in food grains as well as fruits, vegetables, meat, fish, eggs, and industrial raw materials. Farm exports brought in valuable foreign exchange. Despite rapid urbanisation and a fourfold rise in population, India made remarkable progress.


Monsoon lessons

This year, Maharashtra’s monsoon arrived early in May, bringing above-average rainfall across most regions. Continuous rain stalled farm work, caused heavy weed growth, and triggered pest and disease outbreaks. Short-duration kharif crops like moong, urad, sesame, and bajra were damaged during harvest. When the rains briefly paused, the retreating monsoon returned, destroying ready soybeans and maize. Overflowing reservoirs released excess water, submerging riverbank crops and eroding topsoil.Tall, late crops such as cotton and pigeon pea now risk stem and root rot or wilt if water stagnates. Horticultural crops—orange, sweet lime, lemon, and pomegranate—also suffered severe waterlogging losses. Oxygen-starved roots hinder nutrient uptake, causing yellowing, dieback, leaf and fruit drop, and, with prolonged flooding, even tree death.


Redefining damage assessment

Excess rainfall is a national calamity, and compensation should therefore be shared by both central and state governments. Yet, crop losses that appear later are often missed in initial assessments. Damage criteria must be revised, with reinspections or fresh surveys where needed.Crop surveys should go beyond noting crop type and area. Using satellite and drone imagery, officials can track each farm’s condition, compare expected and actual yields, and update land records (7/12 extracts). This would ensure compensation and insurance reflect actual losses instead of uniform payouts to all farmers.


Long-term measures

Soil erosion is a grave concern, as it takes centuries to form even a centimetre of fertile topsoil. Land restoration for farmers who have lost it should use silt from dams or lakes, with embankments rebuilt under the Employment Guarantee Scheme at government cost.Similarly, full financial aid should cover repairs to wells, farm ponds, houses, and cattle sheds, along with fair compensation for lost livestock.To offset the impact of climate fluctuations on yield and crop quality, agricultural research must focus on developing and delivering practical solutions to farmers.


The state’s agricultural universities and scientists should refocus on:

1) Development of improved crop varieties

Rather than concentrating on early-maturing, high-yielding varieties dependent on irrigation and chemical fertilisers, we must develop climate-resilient crops that can withstand stresses, offer better nutrition, and respond effectively to bio-inputs (microbial and organic fertilisers) for higher yields at lower costs.


2) Conservation agriculture

Develop technologies that prevent soil erosion, improve soil fertility, optimise available moisture, and reduce cultivation costs.


3) Integrated, chemical-residue-free farming

Encouraging farmers to combine crop cultivation with allied activities—such as horticulture, greenhouse or shade-net vegetable farming, seed production, dairy, goat rearing, poultry, or sericulture—can reduce risk and promote sustainable, residue-free farming. Adopting such self-reliant systems is now crucial for farmers’ survival.


Maharashtra’s shifting climate shows that traditional farming can no longer sustain livelihoods. A climate-resilient, diversified, and tech-driven approach is vital to safeguard farmers and the agrarian economy. The future of farming now rests on smart adaptation, not weather control.


(The writer is an expert in agriculture. Views personal.)

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