Sacrifice your Star for the Crowd

India has seen considerable growth in the service sector particularly the ITES during the past couple of decades. The growth of this sector has slowed down due many reasons external to the Indian economy.  But there have been major internal challenges too. One such impediment that is internal to an organization is the lack of Internal Marketing.

The first waves of ITES companies were closely aligned with their global partners therefore it was easy to bring in systems, processes & practices that have been followed in the global context. The market was agog with their employee friendly policies and five star office spaces. Therefore talented people never stopped looking for such organizations. The scene has changed a lot.

Just a causal walk into any IT park in India would apprise you of spaces that once were buzzing with youthful activity. What has gone wrong with India’s ITES dream? The answer is pretty dumb. Once Indian managements took over such facilities they turned it into what they knew best, a product centric approach to business rather than intensity of service management.

The scaling down of quality due to several business and other considerations has affected the delivery process so crucial to an ITES enterprise.  Internal marketing have been ignored or forgotten. Training & development have been reduced to mere ceremonies. Once the delivery quality suffered it was normal for the client to change the vendor leading to weak financial performance.

Business organizations in service sector have to leave the HR policies hardened over the product marketing fire in a closed market. Internal marketing & quality of the internal customers would be the only two crucial parameters of success of a company in Education, Hospitality, ITES, Energy & Telecom domain.  Investment in the internal customers & their quality must go up as they only determine the delivery.

A service company must not live on the old fashioned adage of ‘organization is bigger than an individual’ and let its great people leave them for greener pastures. No HR policies must restrain a service organization to pamper their stars performers for the elusive search of team building. You would have bigger team if you are successful, that is just a consequence of an inspired leadership of an individual. Teams are great but greater are your talented people. How would you rate the success of Apple computers without maverick Chief Steve jobs? If your operations are global then it pays to play by global rules. 

Gurinder S Ahluwalia

Challenges Confronting Family owned Mid-Size Companies

Recently I’ve had the chance of listening to an old hand senior person from a fast growing mid-size Company making an introductory presentation about the organization from two years old slides that had names of people who had left the company job too. You could understand the impact he would have made on the audience about the organization he represented. Surely he didn't realize the damage he would do to the reputation of the business.

Family owned mid-sized companies all over the globe have to transition through the trauma of resolving the dichotomy of performance v/s loyalty.  The reverberations of this tumult have long reached to our India but many of us did not give much importance to solving this strategic issue leading to grave consequences for many mid-sized companies.  The jury is still out & a final call has to be taken at the earliest to keep the monster of failure away from the land of new opportunities.

Our mid- sized companies owned by established  family run business houses look like a fascinating kaleidoscope that could be admired for their beauty & size but have no definite strategic pattern that could offer equilibrium and stability to keep them on the growth path for long. 

Indian economy and the business organizations are experiencing unprecedented period of continuous growth which is presenting them with new challenges. Indian business organizations have been used to the organic way of growth and slowdown cycle since a couple of generations. They have never anticipated such long period of continuous change, therefore they have no strategies to keep the organization in equilibrium state while keeping the foot firmly on the accelerator.

Strategic equilibrium, during the growth phase of an organization, is a state of arranging the available resources in a manner so as to provide support to the infusion of new talent & resources to build on the momentum.  Many companies in India have grown leaps & bound in the past decade & most of them have diversified into several unrelated areas presented by the Indian economy.  Such companies have had long periods of organic growth & stability. The fast paced growths into diverse businesses have presented a major challenge to their strategic core competencies that such business houses had acquired over the generations.

A leading auto components engineering company that was established two generations ago presents a happy picture of growth with on the job trained manpower vying for attention amidst a smattering of ambitious smart engineers. You have latest machines silently working alongside improvised technologies of the past.  We have long been known as the land of ‘Jugaad’. A Jugaad is a contraption that gives almost similar but low- grade-less-efficient output as the original equipment would produce.  This was working as long as the level of technology in the country was low & not exposed to the global competition.

Most large organizations have understood the message and overhauled old technologies with swanky new generation lines. But still there are some mid to large size organizations that refuses to go for complete change as they are bound more by their attitudes & tradition than lack of resources or competencies. Sooner such companies upgrade to next level of technology better it would be for them to keep pace with the constant changes in future. This would improve their efficiency & bottom line.

There are similar challenges facing the growing companies with regard to their HR policies & plans too. Small organizations that have grown over the years from small fledgling businesses with few closely knit group of people to large diverse teams, find themselves at the crossroads today in resolving the conflict between rewarding loyalties and recognizing trail blazing performance.  They are increasingly finding themselves straddling the piquant situation of striking a balance between rewarding the years of loyalty and recognizing the performance of the recently joined new age talented professionals.  My close encounters with some mid-size engineering & technology organizations reveal the true dimensions of this harrowing conflict.  Such conflict of interests in a traditional society like India has disastrous consequences for the enterprise thus scuttling its growth.

Corporate world today is replete with incidents of unwanted  show downs between long serving employees having ordinary education, low motivation or desire for growth & change, having  average performance and the new age professionally qualified people burning with zest for competitive growth & consequent change. Indian corporate is certainly going through the generational shift for the better, hence would require professionals with higher appetite for growth and an attitude for adjusting with high rate of change in the environment. The companies of the future would be those who develop robust systems geared to factor in ever present change in the environment.

Let us face it; India is competing with global firms therefore ‘Jugaad’ days would soon be over. The new age companies would require skilled qualified professional to run them.  In such a scenario the organizations would have no choice but to create systems & processes that could engage the tech savvy professionals to fuel the growth in a fiercely competitive world. The loyalty has to give way to performance because any assets that are not aligned to the growth principle would hurt the prospects of the company and make it noncompetitive. 

Gurinder S. Ahluwalia is a Strategic Marketing Consultant based out of Chandigarh India. guriahluwalia@gmail.com  9417723313

What’s not wrong with the golden bird?

Well there are people & groups in India that talk about the ancient glory of India, and others who do not seem to agree with the opinion. I have grown up hearing that once upon a time India was a golden bird, sparrow to be precise, then hordes of marauding armies attacked us and plundered our wealth rendering us a poor place. In the 80s, as a young boy in love with himself I tried to seek out explanations about several shortcomings that plague my identity & persona.

Youth in general are beautifully free from all the muck of centuries that pollute our mental spaces. Those were the goggleless days, so you got to find & read books. Reading books is a markedly different from reading online as books have physical & more sensual contact with the reader.

Excuse me for saying that books are sexy. The youth would reject it & the traditionalist would disown me. Anyways books exude a warmer charm unlike the cold plastic feel you get from your personal computer. Wish the pc maker change the plastic feel that comes when you touch a machine.

Returning back to the topic of what’s not wrong with India, let me say that the most glorious thing about India is that it has not yet given up. Uh! India is a survivor. You can notice a look of struggle to succeed writ large on the faces of millions of Indians. Despite in the face problems like population, poverty, cultural shit, & lack of character there still bloom a lonely Infosys & Naraynamurthy, TATA under Rattan, PM Manmohan Singh and more like them. They are our hopes of a better world India sans cultural bias, efficient, incorruptible, and hard working.

When I was in Universities in my youth most of us agreed that it’s not possible to succeed in India without being morally, culturally & financially corrupt.  So we thought that those of us who have character, charisma & knowledge would not succeed in India and would have to migrate to a place outside India. That explains why so many Punjabi youth longs to get out of India on a first available flight. But the scene has changed in the last decade. I do tell my son that now it’s possible to work hard & succeed in India now.

India is bogged down by its not so glorious past, so sooner we get rid of that and move on better it would be for India.

ICC of Management Education in India

New session of PGDM/MBA for the 2010-12 batch has begun at number of B-schools. Once again the faculty would appraise the students about whatever has happened in the corporate war games till now & what they expect in future. The faculty & students would once more cross their intellectual swords in the classrooms to suggest various new moves & attitudes to handle business game plan in an efficient manner.

The mother of all questions facing a student would be how to approach the learning at the PGDM/MBA program? I believe the greenhorns in the MBA has onerous responsibility to gather the information/Intelligence about the industry sector in which they wish to pursue their career, appreciate the Corporate profiles of the major players in global & domestic market and develop competencies to be approach a situation in a creative manner.

A student must select a broad sector of industry for intensive learning about its regulatory environment, business processes and the SWOT profile. It would be ideal if you focus on your domain as at the entry level there wouldn’t be much scope of work for a generalist executive.  Gather all important data about the sector of your choice in general.

Follow it up with intensive study of major domestic & global players in the industry sector of your choice. Go to their websites, access the Company reports and rummage through their associations & trade bodies agenda. This would help you understand their strategic importance and nature.

Foremost you must be able to develop your creative abilities to the maximum. In the age of google, a smart executive need not bother about information availability as much as the ability to use that information in a creative manner to put together a new solution.  A smart executive has to be more creative than the counterpart in the new post info revolution era.

Thats what i call ICC of management education in India.

Need for a higher degree of probability of outcome

Despite extensive study & advancements in the field of  marketing management, there are few marketing managers who could underwrite the success of a  Product Launch ?  Corollary could be the business enterprise itself & the prevalence of uncertainty cited as a rule almost. If it is not possible to predict the quality of a tool & clarity in a concept, why go on pontificating about it as the must know aspect in the business studies?

I am in the know of few Marketing Managers who say that they have the ability to underwrite the success of their plans. Wow, the management teachers at hallowed business schools keep shouting about the existence of ‘alternatives’ as against ‘the solutions’. They say the strategic alternative you select is just another alternative that looks most probable & that as a rule there are no the solutions to the problems of business world.

Let me clarify it further. Assuming that you wish to launch a product after estimating its demand and fine tuning your business plans relative to your goals but still no one would say for surety about the degree of success citing of the project as a consequence of environmental uncontrollable factors. Well management science and/or art is not mathematical in its nature. But we require certain concepts, tools & practices that have predictable outcome so that risks could be minimized.

What use is the gun that cannot hit target for surety?   Let us list marketing management tools that offer security of known outcome and those managers who could eliminate the variability altogether.

Branding Challenges for an Education Enterprise

Privatization of higher education in India has presented a challenge for the brand pundits & the business owners alike. How do we identify a brand promise and equity so that customer loyalty & brand image can be created? Several large education providers have increased their media spend to get greater share of voice, heart & mind. But most of them end up promising almost same equity. Therefore the challenge is to achieve differentiation based on certain deliverables of great value to the customer & provides a certain barrier for the competition.

Higher education ‘brands’ in India suffer from regional weakness that is completely out of sync with the global reality. Therefore majority of the brands advertise for their assumed local footprint without factoring in a pan India appeal.  Strangely the education sector in India has been allowed to work as a not-for-profit business therefore its formal corporatization has not happened with intensity. Certainly most organsiations in education service sector operate for profit motive only. This leads to overt presentation of organization as a charity/trust aiming to promote a socio-religious cause & covertly looking to create wealth by all means.

I am amazed at the kind of names one comes across in this sector. You have institutes named after gods & goddess, castes, persons etc, there are very few such organizations that have neutral names. Education open minds & promotes new thinking challenging the existing world view but still lots of organizations in this trade operate under traditional names.

Most of the brands in this sector swear by the following characteristics:

1.       Years in operation

2.       Size of campus

3.       International relations

4.       Faculty quality

5.       Number of courses

6.       Affiliations

7.       Placements

Therefore we have institutes after institutes advertising about their placement record, Size of campus, number of students on campus and/or leadership. How does a student benefit in her/his studies if there are thousand more students in the campus? How many students can the IIMs boast of?

During PG level & professional studies students focus intensely on the study ignoring their sporting & other recreational activities. So how could a large campus be a magnet for a student? If you build your institute around the personality of one individual promoter how could you satisfy diverse group of students with one single personality?

Higher education brands must keep secular names to appeal wider audience. Such brands must develop equity in a particular academic field and discipline to create top branding. There is opportunity to associate with a glamorous sport to create image. You would do well by promoting values like team work as against promoting leaders. Higher education organizations must look for new identity in order to keep continuous interest of student.

Organized retail has taught hard lessons to our industry majors

Let us admit that the current players in the organized retail in India completely misunderstood the Indian consumer. Consequently most of them have been vanquished already by the market forces & a few are left in the fray with bruised egos and tattered balance sheets.  

Organised retailing in India has been going through several ups & downs beginning with raw enthusiasm followed by paranoia of failures. No wonder India is an amazing country & you must not lower your guards at any moment as there are many mirages luring you into believing them.  I wonder how come the Indian majors & their blue eyed managers failed to see the writing on the wall.  And the truth is that although India needs malls & the infra related to the organized retail but Indians are not ready to change in their buying habits in a hurry.

Organised retail would certainly succeed in India but the business model has to be reinvented. I am pained to clarify my clients & students about the need to understand the Indian consumer before planning to deal with such diverse group of wonderful people. You could use services of sociologists & psychologists to understand this multifaceted group. But there are few characteristics of Indians that are clearly enunciated like our preference for vegetarian food, belief in God, supernatural & fate, various traditions, family orientation, high opinion about our-selves & a competitive nature. Let us focus on the habits of the consumer.

Most businesses thought once they provide large number of products in one place in air conditioning setting then the consumers would come running right? Wrong! Indian consumers have high degree of trust deficit as they do not trust the sellers on price, quality & other parameters. Therefore there is need for repeated regular dialogue with the consumer that is missing with organized retail model. On the other hand western consumers shop in silence. Indian consumer shop more often and in smaller quantities as different from the developed world. Moreover Indian consumer has greater frequency of shopping & the average revenue is very small.

Organised retail can surely find its feet but they have to reinvent their business model & factor in longer gestation period for breaking even.