Category Archives: General Read

Corporate Acronym

So, I have crafted a 4 letter acronym which I feel satisfactorily encapsulates the four main pillars of surviving and thriving in the corporate world. These four pillars are, the wherewithal one might need to get by in any corporate moat and thus come out on the right side of the crocodile’s jaws, so to speak. These are O-D-I-N.

Odin in Scandinavian Mythology was termed as the God of Victory and Death and perhaps the acronym dutifully explains the fate of the person who purposefully or unintentionally chooses to employ the four pillars in their corporate life. So what does the acronym entail. Here goes.

O – Optimum. There is a very rustic saying in Hindi ‘jitna paisa utna kaam’ which when translated means ‘the amount of work should always be proportional to the amount of money being received’. In short, it means that one needs to exert oneself apropos to the amount of benefit. It is fruitless to push oneself to come up with a cracking strategy or a brilliant idea or even somewhat of an extraordinary method to function when the return on that effort is severely crimped.

D – Diplomacy. It is foolish to have your heart on your sleeve. It is imperative that colleagues, bosses or subordinates don’t really know the real you. The sure fire way to fall away from the bosses favour is to say what you mean and mean what you say. It always helps not to voice out the facts but embellish them with a thick layer of sugar-coat so as to twist and mutilate it beyond recognition. As it is, who wants to know and deal with the facts – they generally tend to be very unpleasant.

I – Insecurity. Near about all corporates thrive on this aspect. Most employees in most of the companies are made to feel insecure – intentionally or not. If not, then a soaking atmosphere is generally created that feeds on insecurity. Insecurity about the money one earns, the competence one has, the promotion that was long over due, the supposed quality of the subordinate, the supposed chance to super-cede the immediate boss, the clandestine closeness of the colleague to the immediate boss and so on and so forth. This helps the employer to have a tightly run carrot and stick policy, which is greased by the oil of insecurity. The employee thus is made to run like the hounds which gazelle through in races with the carrot always a couple of feet away from their extended jaws. The ‘lazy’ hound that is not willing to hustle up is summarily rapped on the knuckles with the proverbial stick and eventually shown the door.

N – Networking. And to the last part. I have a friend who does a dutiful job every month. He chooses to ring and check up on all his friends, ex-subordinates and ex-bosses in all the companies he has worked for. He checks up on how things are at their end and does a customary ‘I am so happy to have spoken to you’ thing. The golden method of ‘keeping in touch’. This keeping in touch helps people generally land up plum posts, plum assignments and definitely plum projects, never mind if everybody in the food chain knows that everything that is being discussed is absolute nothing and is but general rubbish banter.

Perhaps, there is too much of a negative slant on the corporate world that comes out of this post but then, have come across precious little positive with respect to the corporate world.

‘De-seeding truly on the way’

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This is just an addendum to the earlier post that I had put on Apple. Attended the keynote (digitally, of course, hell man I don’t have the money nor the wherewithal to be invited at such a bespoke event) for the launch of iPhone 7 and 7 plus on the 7th of September
Is there anything to write home about? Is there anything clearly and disruptively new about the phone? A loud and a resounding NO.
The general spiel is that it is ‘x times faster’ in processing, ‘x times sharper’ in camera resolution, ‘x times better’ in screen clarity, ‘x times longer’ in battery than the earlier iPhone. Well, good for the iPhone 7. Beyond changing a bit here and there, beyond re-gilding the bell and re-tuning the whistle, there is nothing of note in this one.
A few question then that really beg to be asked –
Why is a company which was not too long ago an innovative and disruptive thinker, reduced to mere delta changes in its product offering?
Going forward, is this what we are to expect from the Apple stable – perfunctory step up improvements in the existing product line.
Are there any path-breaking product offerings on the anvil that Apple is currently working on or even exploring?
If no to the above question, then is Apple sorely missing a completely blue-sky thinker along the lines of Steve Jobs, who has the ability to foresee tomorrow’s needs today and provide him/her with solutions hitherto not envisaged?
Only time will tell.

Apple ‘De-seeded’

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Currently, the brand ‘Apple’ is worth anywhere between $145 billion to $170 billion if we were to take the various brand valuation reports. So in essence, if the company were to just hand over the name, logo and other attendant aspects associated with the brand to some company, it would in return get an amount which would be equivalent to the total foreign exchange reserve of the bottom 10 of the top 20 holders of the green back. That tells a lot about a private brand.

But I have a feeling going forward that this is unlikely to sustain. In the next half a decade or so, we will find newer brands upending Apple and the primary reason isn’t that the other brands i.e. Internet brands like Google, Facebook, Cisco would be doing exceedingly well but simply because Apple might falter going forward. Don’t get me wrong, I would be the last person wanting to see this as I really love the brand and would really be saddened, but then it appears that the writing is clearly on the wall. There are 3 strong reasons that I have and let us look at them in detail:

1st Reason: For the past couple of years, there has nothing cutting-edge that has come out of the Apple stable. There are no ‘wow’ products that have graced the Apple portfolio – something that made us sit up and take notice like an iPhone or an iPod or even an iPad. Most of these products were way ahead of the conventional realm that the customers were able to muster – they were due to a certain rigour in a blue-sky thinking. Most were of disruptive nature providing a massive change over the existing product lines. But the past few product offerings are just about providing delta changes over the existing products – be it own or competitors. A better camera or bigger screen doesn’t exactly ring the innovation bell. It doesn’t behove a company which calls itself intuitive and then goes and introduces products which are well just changing a few bells and whistles here and there and packing it nicely. Are we getting any where even closer to what we got when we had a dodgy and clunky candy bar phone in our hand and were introduced to a smooth and slick iPhone. Or for that matter had to fiddle with Walk-mans/Disc-mans with it’s cassettes and discs and in came a unit which had in-built songs and a nice way to toggle through? Highly unlikely, isn’t it?

2nd Reason: The 1st reason brings us to the 2nd important reason as to why Apple seems to run its course. Earlier it was always a strong intuitive power – perhaps the vision of Steve Jobs or the downright dogged disinterest he seemed to have for the consuming classes – that governed the product offerings. Hence, iPhones were available in just 2 colours and one format. ‘This is what I have – take it or leave it’ was the go-to-market spiel. Steve Jobs was legendary in his disrespect towards the proverbial conventional marketing approach – market consulting, research, test market etc. If it was a path-breaking product on the cutting edge, we should launch it in the market – never mind whether the customer is ready for it or not. Never even mind if the new launch is cannibalising our existing portfolio. The customer nearly always looked to take cues from the company rather than the other way round. And it was obvious, a company on the cutting-edge and which prided itself on innovation would necessarily look to lead and be a thought leader as compared to be a follower and try to understand the customer. An intuitive company necessarily has to understand the customer needs silently and provide them with a thought leadership.
Cut to now, where the Apple brought a bigger and an even bigger screen iPhone, not to mention an iWatch. Add the other embellishments – iPhone 5C, various SKU’s (colour options) and you have a portfolio which was going in to near about 10 (thus adding to the keeping cost of the channel)
Following customer’s whims and fancies is a difficult task – the customer wants a bigger screen on a mobile, albeit a smaller on a laptop and as of now it has not made up his/her mind on the size of the screen it loves on a tablet. Thus, following such an animal is fraught with risks and bound to increase the cost to the market – not to mention losing the air of cutting-edge-ness due to being a follower as compared to a leader.
Moreover, just recently Apple launched an iPad air similar to the Microsoft Surface (which it had launched a couple of years back). Something that was not lost on Microsoft too (a company like Apple trying to ape and copy products from its own stable). Since when did Apple start imitating products that others were hawking? This again is the sense that Apple had fallen in to the trap of following and not leading, of introducing what the customer wants now but perhaps afraid to introduce what the customer has little inkling of what it wants. A cutting-edge innovator cuts a very sorry figure when it chooses to follow; it isn’t in its nature. As is the rule of the jungle – the tiger leads but never follows – cause it doesn’t know what it takes to follow or how to follow. That then brings me on to my final reason.

3rd Reason: For the past couple of years Apple has been hoarding a huge cash from the profits that it has generated – cash that it is trying to meaningfully deploy but not been able to. Hence you find the various un-related business that Apple is trying to focus on – self-driving car, investing about a billion quids in completely unrelated business (Didi) and trying to up the service quotient of the company by introducing Apple Pay. So is Apple trying to pivot in to a service company, since going forward the pipeline of cutting-edge products seems dry?

The next few launches from the Apple stable will confirm or deny all of the above, till then it is for Apple to see and plan and for us Apple fans to just secretly wonder.

Click Click

Flipkart, Amazon, Snapdeal, Urban Ladder, Shopclues and many more such start-ups are dotting the Indian e-tailer industry. Most of them are being touted as one success or the other backed by millions of dollars flowing in to their individual kitty. They are backed by the alphabet soup investors i.e. VC’s, PE’s, etc. So are these companies really successful? Let’s take a closer look.

The other day I bought a trolley branded Disney Bag for my child. The tag cost was Rs. 1,600. The amount quoted on Amazon – Rs. 800. The bag was sold by Mom and Me (part of the Mahindra Group). Let us look at the mechanics of the entire sale. Mom and Me (the seller in this case) chose to use Amazon as a market-place i.e. a platform to sell its goods to a customer i.e. me. Mom and Me would have sourced the product from Disney which in turn would have got it locally manufactured at the lowest cost producer. So if the product is tagged at 1600, keeping in mind a healthy margin of 20%, the cost price of the product for Mom and Me would be around 1200-1300. The product is being sold at 800 a good 400 below the cost price. Surely, somebody is losing money in this? Who is paying up the mark-up to the bridge at least the cost price if not the margin? No marks for guessing that the market-place is discounting the product but the seller might also be taking a small hit in the bargain. Another example, I bought Asics shoes on Flipkart, the cost price of the product 6,900. The fetched price – a good 50% off. The product is imported directly from Malaysia by Reliance Retail. So who is making good on the deep discounting in this case? Again the market-place.

So now to the moot point. Is this sound economics? Is it a sound business plan where in the product is so heavily discounted that you need to pay from your own pocket for any product that is sold? Flipkart currently is the victor in the battle of the e-tailers. Somehow I feel this is nothing but a pyrrhic victory – a winner’s curse. The more a person looks to buy on Flipkart, the more the e-tailer burning cash. The annual cash burn rate for Flipkart is a whopping $600 million. That is about $50 million monthly i.e. 300 crores in Indian money. No wonder the e-tailer is on the deal street every 6 months looking for investors’ money to shore up its bank balance. The money that is raised is used for general corporate purposes i.e. acquisition, shoring up the back end and the interface and most importantly – discounting strategy. Well, in my 15 years of marketing and strategy experience and my 2 years of management education I never knew that the word ‘discounting’ can at all be used in conjunction with strategy.

Anyways, let us look at a few numbers. This data is for the finanical year FY14. The data has been culled from various business dailies. The revenue chalked up by the company was around Rs. 3,000 cr. The profit is somewhere close to -700 cr. i.e. a loss of 700 cr. The GMV (Gross Merchandise Value – the total value of the prouduct sold on the website) was Rs. 25,000 Cr. The valuation commanded by it a jaw-dropping $ 11 billion i.e. Rs. 68,000 Cr. So if we look at the delta i.e. the multiple that the e-tailer is commanding, we are looking at anywhere close to 22 times the revenue and a multiple in terms of the profit cant be calculated since the company is making a loss currently. Such a high multiple for a company about 10 year old with unproven track record is quite unheard of definitely. But then the measure that is being used here is the delta with respect to the GMV’s. The number of customers (unique or otherwise) the website is able to successfully tap. Since there is no benchmark in the industry (it being nascent in nature), the general rule of thumb is that the valuation is decided by the next round of funding in to the company. The more an investor invests for a lower equity stake – the higher the subsequent valuation (post money valuation).

So how does a company making losses, having a unsound strategy of paying for products from its own pocket be valued at over $11 billion of greenbacks?

I get a feeling it’s a game that we used to play when we were kids i.e. monkey off my back. Every child used to make sure that the monkey on his back is given away to somebody else. As is in the game – the kid giving the monkey away is lighter whereas here the investor in the e-tailer is richer by a few millions. So is there a loser in this game? Well not really, atleast not in the near term. Everybody is gaining. The founders with the heady valuations and with the tiny slivers of the equity that they own – they are already millionaires. The investors backing the company look to ramp up the valuation since ultimately in the long run when they cash out they would look to pocket a tidy sum but in the near run there is some heartburn with the cash burn in the e-tailer. For the customer it is Diwali or Christmas (the way you look at it) every day. It is making hay while the sun is shining and why not – no need of going to the market but the market comes to you and that too at a heavily discounted rate.

I remember a TVC for a SIM card company in which the protagonist is off to foreign land and he is using the company paid mobile phone to call up home. His common refrain is ‘company ka maal dairya mein daal’ (Company’s money put it in the drain). Well this is so apt in this case just with a slight twist – ‘VC ka maal, pocket mein daal’ (VC’s money, put in your pocket).

Strategy or Stratagem

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I have spent about a decade in the corporate world in various capacities – as a junior person, as a mid-level manager and as a consultant. One aspect that has struck me always is the DNA of any corporate of ‘doing time’ i.e. spend hours and hours at the work desk – weekdays, weeknights, weekends etc. This perhaps is more evident in those fields where the outcomes are somewhat intangible. The assuredness is lacking if the final objective is neither a number nor a percentage.

A case-in-point, an acquaintance of mine works in one of the top banks in the country. Thankfully, he stays at about 10-minute drive from his workplace. The mention of the travel time assumes importance because the very next statement. Dutifully, he leaves home every day at 9 in the morning and comes back at about 9 to 9.30 pm. That includes the week-ends too – where in the come-back time contracts to about 6.30-7 pm. A straight back-breaking 12 hours every-day amounting to about a crazy 65-70 hours a week and he is in sales function.

This got me seriously thinking – what has brought about this Frankenstein-esque DNA change in our corporates or was it this way always? Why then spending 12 hours a day is a norm rather than an exception in today’s work place? My observations are thus.

The way any corporate ticks tells a lot about how there is a trickle-down effect on the workplace. Any corporate worth its salt is governed by numbers – the top line and more importantly the bottom line. A corporate gone public is shackled and follows the diktat like a bull with a nose-ring attached. The basic raison-d’être then for any corporate is earnings – earnings that have to necessarily progressively grow. Never matter whether the consumer doesn’t want to buy, doesn’t matter if the client doesn’t want to spend and never matter whether the economy is under a heavy recession. This very primary foundation is shaky. This very objective – of wanting to grow at a compounded rate of x% over a 5-year period irrespective of the milieu – is seriously flawed. It depicts some kind of a voracious greed. A greed that is insatiable, that is unmindful of the existing situation and definitely indifferent to the manner in which it is being temporarily fulfilled.

This objective aka greed then is transplanted in to the employees in the form of a deep inherent insecurity i.e. about their own competence, about the take-home packet, about the next promotion, about the close-ness to the immediate boss and so on and so forth. In fact this very insecurity is the prime mover which oils the corporates wheels – that enables the corporates to have the carrot and stick policy – perform and you get attractive numbers added to your personal bottom line or else you become one of the numbers which are benched.

This DNA is aptly characterized by the Mahabharata war. The kind of culture (for want of better word) that was present at Hastinapur and Indraprastha. At one end was Hastinapur which symbolizes the current corporate thought process – top down approach, unnatural focus on bottom line, develop a deep insecurity among its employees/subjects and above all an adharma (untruth) approach to situations i.e. getting the job done never matter the means/consequences as opposed to Indraprastha which focused on a collaborative approach, believed in the well-being of its subjects and above all believed that dharma (truth) should be the focal point to its approach and decision-making.

I must admit that I haven’t come across a single corporate – neither directly nor indirectly following on the footsteps of Indraprastha. Perhaps, I sincerely hope that my decade long experience is short enough to bring me across such organizations because needless to say we all know which kingdom survived at the end.

In conclusion, I sense that there is this superb African proverb which aptly encapsulates the life in a corporate world. I just couldn’t help but associate it with the corporate life across the board –

Every morning in Africa, a gazelle wakes up. It knows it must run faster than the fastest lion or it will be killed. Every morning a lion wakes up. It knows it must run faster than the slowest gazelle or it will starve to death. It doesn’t much matter whether you are the lion or the gazelle, when the sun is up, you better start running.

‘Un-social’ Networking

So what is your Facebook Id? A simple question posed to me by an ex-colleague of mine to which I replied in a negative. The raised eyebrow, enlarged eyes and an odd face staring at me told me quite a story of ‘social networking’.

Look around and almost everybody is on one or the other social networking site. Be it my wife’s eighty-five year old grand uncle or a good friend’s one year old son. There are children as young as six years old that are on such sites and happily ‘networking’ with other kids their age and preferably somebody older. There are more than a few features of a social networking site that intrigues me but the one aspect that interests me the most and makes me wonder in amazement – the friends’ list. I have seen a few of my friends have at least 500 profiles on their friends list and they are mighty proud about it. Does s/he even know who these 500 people are? Is it not that at any given point of time, a person can handle only a certain number of individuals? Out of these there are a few who are completely non-negotiable i.e. relatives, colleagues, taxi/auto drivers, bus conductors, maids etc. Why would then one be inclined, find time, expend energy to add so many people on the ‘friends’ list? Surely, they aren’t all really good friends whom you want to know everything about. Or are they?

This brings me to the basic aspect that is a bit discomforting with such social networking sites. Just recently I had a chance meeting with a copy writer friend of mine who works at a leading ad agency in Mumbai. Let us name him Vishal. He had an interesting tidbit to narrate. About a year back, Vishal got a message on his profile from a long-lost friend, settled in US. That friend had wanted to get in touch with Vishal and had been looking for him for over a year now, calling up common acquaintances/friends etc. and good that he found him on Facebook. Vishal the emotional chap that he is – promptly sent across his mobile number so that the long lost friend could have a heart felt conversation with him. That was about a year back; Vishal is still waiting to hear from the long-lost friend – either on the phone or even on the social networking site. This definitely is the rule and I am quite sure most readers who are on such sites faced this in one form or the other. This seriously got me thinking. If that long lost friend was so interested to know where Vishal is, or how he is, or wanted to have a chat with him, shouldn’t he have called back the instant he received Vishal’s mobile number. Did he never intend to call Vishal, if not, then what was the basic reason behind the message?

So, now some moot points. If a person is really interesting to meet or chat up – wouldn’t one rather meet in person or talk over the phone? What good would it serve to just put a static ‘hi’ or ‘hello, what’s up?’ on the other person’s profile and wait for him/her to respond? Is it that people like being passive in nature or the idea of ‘just keeping in touch’ is of primary importance? Does it not go against the grain of what relationships are all about? It is natural for a person to want to meet or talk to somebody whom s/he likes and finds interesting – meet being the operative word here – not put a post on the person’s profile. I can clearly understand that meeting or talking over the phone isn’t possible if the distance is long i.e. the other person is abroad or in a different city. But then whatever happened to e-mail? Isn’t e-mail or a chat program the best way to interact rather than having staccato post on a social networking site? As the case with Vishal’s friend, maybe it was just a post that he put – maybe he never meant a word that he wrote. Maybe it was just some casual banter that ensues between individuals. Maybe he was just being nice to Vishal. It appears then that these sites are able to perpetrate the air of fakeness and still come across as genuine on the outside – the same old idea of ‘being nice’ than being true. The sad flip side of it all is that these social networking sites are just the messengers and the handlers behind them are real people like us.

So, do we construe by all this that people inherently aren’t genuine about their true feelings?