October 31, 2008

Growth is all about new ideas and their execution. Smart organizations know this fact and do everything within their control to make their organization an ocean of ideas. And their secret weapon to unleash the power of ideas is to convert their people into idea machines who endlessly churn out ideas, help in separating the grain from the husk, and then polish them.

Sadly, a majority of organizations never understand the importance of their people to provide a continuous stream of ideas, some of them potentially great ideas. They rely on a few brains for new ideas when they can use their entire workforce to come up with ideas. But ideas by nature are serendipitous. You never know in whose mind the best of ideas would originate. The more the number of brains at work, higher the probability to get better ideas.

Here are a few suggestions for organizations to involve their people in idea generation and idea management.
  1. Put a senior leader who is passionate about creativity, ideas, out-of-the-box thinking in overall charge of idea management within the organization. Let her be a filter to evaluate all ideas.
  2. Put an easy to use system in place where people can freely and comfortably share ideas relevant to organization. An idea discussion forum on the Intranet can be effectively used for this purpose.
  3. Encourage people to share ideas.
  4. Encourage people to comment on others ideas on the idea discussion forum. Let an idea to be refined and polished through inputs and critical evaluation of the peers.
  5. Openly reward people who come up with maximum ideas every month.
  6. Focus on quantity of ideas rather than quality. Key to generation of great ideas is to embrace stupidity. You never know when an outlandish idea can give birth to a billion dollar idea.
  7. If an idea turns out to be commercially or non-commercially beneficial, share the credits with the originator of that idea. Make them heroes.
  8. Continuously communication the importance of ideas to all levels of the organizational hierarchy. Maintain a continuous flow of creative juices by sustaining the excitement associated with idea generation.

"If you expect those below to support your leadership and step into the breach when needed, they will need to understand your strategy, your methods, and your rules."

- Michael Useem, Author of "Leading Up"

October 30, 2008

Just Blurt It Out!

Posted by Bizaholic | 9:01 PM | with 0 comments »

In life as well as business, communication plays an important role. Many problems have their origin in poor communication. Similarly, solutions to many problem are communication centric.

Organizations are made of human beings. Whatever is said not only goes to head but also to heart. It is natural that sometimes people comprehend something which is completely different from the intended communication. Often, this takes a negative turn and people feel hurt. In such a situation, some people simply speak up their mind and let others know how they are feeling. In the process, they let others know whether they understood what it was intended to or not. So, speaking up helps the other person to know whether she has effectively communicated or not and offers a chance to remove any misunderstanding.

The problem becomes acute when people who are hurt don't speak up. This happens mostly if the hurt person is junior in hierarchy to the person whose words hurt him. If the hurt person doesn't speak up, there is very little chance that the person, whose words hurt someone, will know about it and clarify her communication if it was intended differently than what was perceived by the aggrieved person. As a result, the hurt and the resulting agony keep simmering and affect the relationship between people as well as productivity. Sometimes, this turn out to be a cold war that was never supposed to happen.

It always helps in such situation if people speak up their mind. Speaking up opens a window to clarify positions and remove any distortion in intended communication. But for that to happen, culture of an organization should encourage speaking up without fear, even in front of seniors. If people know that speaking up would not be taken negatively, communication related bottlenecks of organizational as well personal productivity can be sorted out.

Just blurting it out may resolve a lot of communication problems.

"Most ailing organizations have developed a functional blindness to their own defects. They are not suffering because they cannot resolve their problems, but because they cannot see their problems."

- John Gardner

October 29, 2008

Emotion and Advertising

Posted by Bizaholic | 7:40 PM | , with 0 comments »

Marketing is an emotional game and good marketers know how to leverage emotions. But sometimes we get so engrossed in emotion that we forget that our ultimate objective is to sell a product and establish it as a brand. Often, we get sentimental and end up showcasing an emotional stuff that is brilliant yet fails to deliver the brand message.

If you are following some of the advertisements running on TV these days, you must have noticed the increased frequency of using kids to tell the brand story. Nothing wrong in it. Cute kids and doting parents typically generate emotions that are hard to ignore. Yet I was wondering if the emotional stuff generated through kids in advertising was putting the brand on the back seat.

There is an ad in which the proud parents ask the toddler to pronounce daddy, mama, banana, and Czechoslovakia. Touching ad and people may love to watch it many times. I too watch it when I find it on air. But it took me more than 10 exposure to realize that it is an ad for some insurance company. Max New York Life got in my head only after some 15 exposures. Well, I was too focused on watching the kid! Similarly, there is an ad about "a little girl intending to cultivate sone ke ped (golden tree) by sowing teeth". I guess it's Union Bank of India. There is an another "too focused on kid" ad about a small boy trying to learn to click his fingers. It's Indian Overseas bank (I just found this out!)

These ads look good to watch. But where is the brand connection? Do they tell a brand's story or a kid's story? Is it easy to identify the brand while watching the ad and relate to it? In my view, these kinds of ads fail in their primary purpose of delivering the brand message. If the process of delivering the message and building the connect with audience is through entertainment, it's great. But there is no point making ads to entertain people!

Emotion and entertainment is important in advertising and marketing. But ignoring reality is hazardous.

"To lead people, walk beside them ... As for the best leaders, the people do not notice their existence. The next best, the people honor and praise. The next, the people fear; and the next, the people hate ... When the best leader's work is done the people say, 'We did it ourselves!"

- Lao-tsu

October 28, 2008

"Fault finding is easy but that would serve no purpose. You need to build a team to get things done."

I and my boss were discussing his recent visit to some troubled markets where market share was under severe pressure. While elaborating what was wrong there, he remarked that although it was very easy for a senior manager to find faults with people and their way of doing things, it was highly unlikely to do any good in tacking the tough situation. He said that key to handling tough situation was to build teams and boost the confidence level.

It's true. Tough times demand a new approach; a drift from what we have been unsuccessfully doing to something different and innovative. But this requires collaboration of minds and confidence in one's ability. During tough times, motivation is generally low and people tend to focus more on managing their weaknesses instead of playing to their strength. During these times, it's best if the leader focuses on team building and increasing the morale of the team instead of doing a post-mortem analysis and finding scapegoats. Tough times demand a strong team that has abundance of faith in its competence and the ability to focus on their strengths to overcome a difficult situation.

"No man will make a great leader who wants to do it all himself or get all the credit for doing it."

- Andrew Carnegie

October 27, 2008

In September 2007, a friend who worked in India's leading brokerage company was over enthusiastic about the rise of stock market. He was telling how in just one more year Sensex would reach 25000! By December 2007, Sensex was around 20000 and it seemed his prediction would be right on the mark. Around this time, a senior colleague said that Sensex has reached too high a level and correction would happen and it would settle around 18000 for sometime. Amid all this I felt like a fool to have sold off my entire stock holding!

It is October 2008 and I am a happy man who didn't burn his fingers in the stock market. In just 10 months, Sensex has crashed by 57%. This is not a unique phenomenon. This crash is like history repeating itself and frankly speaking I am not amazed. I was expecting it. The sad part is that again and again we fail to learn our lessons.

I am not a financial expert. But all it takes is some commonsense to understand that stock market is not run by bulls and bears. It is driven by emotions and greed. Human psychology and the desire to get rich quick are behind the unprecedented rise and fall of stock market. When the sensex is rising, no body expects it to fall as if it is into an infinite bull run defying all logic. And when it starts falling, no one expects it to run into a bottomless pit as there is always a support level to talk about.

I fail to understand why logic seldom gets its due in stock market. What logic justifies prices of stock getting double and triple in 6 months without any major change in business portfolio or macro economic environment of the companies? And what logic justifies astronomical rise of penny stocks? Every time there is an economic boom, there is a talk about story of India rising. Do macro economic fundamentals change in just 3-4 years? We talk about the great consuming class of India but we are yet to develop a sound manufacturing base. Consumption boom will never take off through agriculture and services unless there is a threshold level of manufacturing base.

Well, it is blasphemous to talk about logic, reasoning, and commonsense in stock market. Despite the current crash I don't expect investor behaviour to change. It will continue driven by emotions and greed. In the process, some will make money by the truck load and some will lose money by container load. Stock market will remain a zero sum game!

"A business has to be involving, it has to be fun, and it has to exercise your creative instincts."

- Richard Branson

October 26, 2008

Crumbling realty sector in India

Posted by Bizaholic | 11:04 AM | , with 0 comments »

Today this news in Business Standard caught my attention. Funny as it may sound but this is the level of desperation in realty sector in India. After unprecedented rise, defying all logic, over last 5 years, reality sector is getting some reality bite. So to beat the blues, there are offers like one flat free on purchase of another, free luxury cars, free parking space, free registration, and free interior decoration. Seems like too many FMCG marketers joined the realty sector in last few years!

These offers tell another story. Despite desperation, realty firms are still optimistic. That's the reason behind these freebies. In blind hope that things would improve in coming months, they are not ready to go for outright reduction in realty rates. Instead, they are holding on to astronomical rates and trying to beat the 'temporary lull' with freebies. But the fact is that this is not a 'temporary lull' but a market reality requiring price correction that has been preponed due to economic slowdown. Freebies may continue for a while but ultimately the prices of realty is going to see a sharp fall, may be a crash, in next 3-4 months.

No where in the world, realty prices rose as fast as in India. Price was getting doubled every year in last 2-3 years. Everyone irrespective of the money in his pocket was buying a flat. Thanks to low interest rates over last 5-6 years, financing a house was easy and banks were ever willing to get you the dream house. Cut throat competition in the banking sector ensured that rigorous checks and balances where given a miss while sanctioning the loans. So, every 23 years old lad, who was just out of the college and earning Rs 25000 a month, was buying a house! The realty prices just kept going north. Builder kept developing more and more property buying land at unjustified prices.

Gradually, interest rates too moved north. With the arrival of economic slowdown, things suddenly started turning topsy-turvy. Banks started facing music. Firms started talking of pink slips. Big pay hikes and amazing bonus seemed to be thing of past and threatened to follow the Hindu growth rate once again. With money becoming tight, buying property went several notches down the priority ladder. But over-optimistic, perhaps greedy, developers ensured there was a surplus of newly developed and under developed realty. With hardly any buyer and a realty bubble getting bigger by each passing day, evergreen laws of economics were bound to takeover. And they did!

It seemed that the party would never end. But seldom has that happened. All good things die a natural death. Indian realty boom is no different!

"It is well known that "problem avoidance" is an important part of problem solving. Instead of solving the problem you go upstream and alter the system so that the problem does not occur in the first place."

- Edward De Bono

October 25, 2008

Kids add cuteness and emotion to advertising. When effectively used, they can narrate the brand story in the most convincing manner by hitting the right spot in consumer's heart and mind.

Here are 8 types of potential role kids can play in advertising:
  1. Kid as an influencer - As an influencer, kids play an important part in the purchase decision and so cannot be ignored. It can be leveraged in advertising by showing the needs of kids and how they express them. In this scenario, communication goal should be to target kids as well as adults.
  2. Kid as an enabler - As an enabler, kids are the reason to buy and symbolize the basis for a purchase decision. It can be leveraged in advertising by relating the product or service to the well-being of the kid. The key is to focus on influencing the adult by using kids as a tool.
  3. Kid as a buyer - Here kids actually buy and parents either don't influence or the influence is minimal. It can be leveraged in advertising by portraying a responsible kid who buys sensibly. The portrayal of the kids should be such that she doesn't betray the trust of her parents through her purchase decision.
  4. Kid as a preacher - In this scenario, there is an educated and smart kid who preaches the goodness of the product to her visibly ignorant parents. It can be leveraged in advertising by showing role reversal; kids acting as an adult and adults acting as kids. The key is to tap the general belief that today's kids are much smarter than their parents were in their childhood.
  5. Kid as a pestering brat - It's a situation where kids emotionally blackmail their parents by threatening to flow a river a tears! It can be leveraged in advertising by showing the pestering nature of kids and the joy adults feel in finally giving in to their demands. It can work well for products with high impulse purchase index.
  6. Kids as an entertainer - As an entertainer, the kid tries to hit the right spots in adults by playing to the "choo chweeet" effect. It can be leveraged in advertising by playing on "the childlike nature of the adults" to influence them.
  7. Kid as a the pivot of the family - Here the kid means everything to the family. Happiness of the family starts and ends with the kid. It can be leveraged in advertising by showing kid as the central figure of the family and how everything revolves around her.
  8. Kid as a plot - In this role kid is the hero of the brand story who tells it all in her own language. It can be leveraged in the advertising by bringing out "the child in every adult".

"Leadership is not magnetic personality — that can just as well be a glib tongue. It is not 'making friends and influencing people' -- that is flattery. Leadership is lifting a person's vision to high sights, the raising of a person's performance to a higher standard, the building of a personality beyond its normal limitations."

- Peter Drucker

October 24, 2008

First 15 days of Bizaholic...

Posted by Bizaholic | 7:00 AM | with 0 comments »

Bizaholic has completed 15 days! During this period, some 45 posts were published and the template saw one change. Not a bad progress.

As far as content is concerned, we are still in experimental phase and content is evolving with each passing day. However, we have been able to give some structure to it as illustrated below:

Regular Columns
  • Monday Blues - Published every Monday covering some topical issue to beat the Monday morning blues.
  • Marketing Chutney - A fortnightly column on marketing, published on 1st and 16th of every month. It covers thoughts on issues related to marketing.
  • Bizaholic Thought of the Day - Management thought published every morning to give a head start to the day!
Apart from the Regular Columns, Bizaholic is updated daily with random opinions and thoughts, news analysis, and topical issues.

In near future, we are planning to add some more substance to the content by adding following features/ contents:
  • Interview of the month to cover thoughts of managers and leaders at senior level.
  • Daily Headline section - once a day link dump of headlines from various business newspaper websites.
  • Guest Articles
  • More regular columns (published fortnightly or weekly) on subjects like leadership, digital marketing, advertising, HRM, etc.
We hope you are enjoying Bizaholic. Please share your views on current content and planned content. Also, please suggest the type of content you would love to read on Bizaholic. You may write to us at bizaholic@gmail.com

Planning cost cutting

Posted by Bizaholic | 6:30 AM | with 0 comments »

Cost is a monster. All measures should be taken in any organization to reduce this monster to size. But where you cut cost is more important than how much cost you cut. Cost cutting at wrong places could turn out to be quite costly in long run.

Following points may be kept in mind while planning a cost cutting measure:
  1. The key is identifying genuine areas where cost cutting is possible without any productivity loss.
  2. Look for cost optimization opportunities.
  3. In a bid to cut cost, don't cut off your organization's competencies. And don't outsource your competencies
  4. Cost cutting when practiced as a fad and applied to anything without much thought is a dangerous thing.
  5. There has to be a concerted effort throughout the organization to cut cost.
  6. Communication is vital to engage people all across your organization to help in cutting cost.
  7. Avoid touching genuine costs related to management of brand and corporate image. These costs are fundamentally an investment.
  8. Leaders should practise what they preach. Otherwise, it would remain another grand vision on paper. A very senior manager was found urging his people to use less paper by using their PC more and printer less. This same guy needs hardcopy of almost everything, including emails!

"When we look to hire people, we invariably look for sameness. It is so much more comfortable. But progress requires intelligent friction, push back, points and healthy counterpoints. The job of leaders is to build high personal comfort with contrarians who think differently, create alternative points of view and have the power to question the state of things."

- Subroto Bagchi, in Go Kiss The World

October 23, 2008

So you have a product that you want to sell to kids. Well, before making a TV advertisement or a marketing program for it, ponder over these insights:
  1. An ad targeted at kids should be as real and natural as possible.
  2. Kids have high emotional appeal for parents.
  3. Don't undermine their pestering power.
  4. Get hold of kids' fantasy, behaviour, dreams, and aspirations; play on them.
  5. Kids like to collect things.
  6. Kids below 10 years of age believe what they see.
  7. Communication which shows them as "being naughty and playful and yet behave as responsibly as an adult" would definitely catch their attention.
  8. Simple message is sweet.
  9. Relationship aspect of brand identity is most vital for kids.
  10. Indian culture is still family oriented. Hence, for kids parental approval is of great importance.
  11. Pure entertainment is what warms up a kids to a TV Ad.
Based on the above insights, we can safely deduce that an effective KIDMIX should have the following:
  1. Pure entertainment.
  2. Ample helping of humour.
  3. Generous dose of parental approval.

Discounting and Brand Equity

Posted by Bizaholic | 2:57 PM | , with 2 comments »

Tough times, whether in form of economic downturn or increased competition, throw big challenges on brands. It is much tougher if the brand is a market leader. In these tough times, to meet the expectations for growth and market share, marketers have a tendency to resort to techniques like coupons, freebies, offers, etc. But is it the right approach, particularly in light of long term impact on brand equity?

Discounting your brand is a tricky thing. It is addictive for the consumers. You give it once and they will ask for it always. In the process, the long term brand equity is hit hard as in the subconscious mind of a consumer, quality is to a large extent a function of price. Higher the price, better is the perceived quality and visa versa.

If you are a strong market leader or established brand, avoid discounting your brand through freebies, coupons, discounts, etc. Discounting hurts established brands with established quality more than new or struggling brands. New or struggling brands often tend to run discounting programs for longer duration with an intention to eat into the marketshare of established players. They may get a short burst of sales, but discounting never helps them to build a brand. Brand building is all about building affinity rather than bribing its way to consumption.

But sometimes due to category dynamics or macro economic environment, discounting becomes unavoidable. In such rare circumstances, keep in mind the following:
  1. Use it as a tactical weapon rather than as a strategy.
  2. Use it only for short durations.
  3. Be innovative. Instead of simple discount, try working out cross-promotion or any other such idea that gels with your brand and which enhances rather than diminish your brand equity.
  4. Don't use deep discounting.
  5. Communicate in terms of percentage rather than absolute value. Even when using percetage, avoid easy to remember values like 50% or 25%. Instead use something like 22% or 31%. The idea is to make it harder for consumer to remember what discount you gave her the last time.
  6. Clearly communicate the purpose of discounts. Make sure the purpose in no way dilutes the brand equity or quality perceptions.

"Don't equate activity with efficiency. You are paying your key people to see the big picture. Don't let them get bogged down in a lot of meaningless meetings and paper shuffling. Announce a Friday afternoon off once in a while. Cancel a Monday morning meeting or two. Tell the cast of characters you'd like them to spend the amount of time normally spent preparing for attending the meeting at their desks, simply thinking about an original idea."

- Harvey Mackay

October 22, 2008

"The great mystery isn't that people do things badly but that they occasionally do a few things well. The only thing that is universal is incompetence. Strength is always specific! Nobody ever commented, for example, that the great violinist Jascha Heifetz probably couldn't play the trumpet very well."

- Peter Drucker

October 21, 2008

Is economic downturn a disguised boon? This is the question I have been asking myself since last few days. Yes, the time is bad and business is suffering. But let's think long term. Let's think of surviving the downturn and arrival of good times after a period. Perhaps, the period of downturn can act as a testing period to assess your organization's strength and give you an idea about the depth of talent and competencies available.

Here are a few reasons why I think economic downturn are a disguised boon:
  1. It forces you to think out-of-the-box to get business, maintain business, retain customers, optimise cost and customer service, and many more demands of the time. So you get an idea about how much creative blood is flowing in your organization.
  2. Economic downturn are always demanding on existing manpower. So almost every employee feels the heat and is expected to deliver more. Here you get to see who are the people who can walk a tight rope and who all are good only in good times. To fight the downturn, your give additional responsibilities to your people and get to see who are the people who have matured to shoulder higher responsibilities. You get an opportunity to pick diamonds!
  3. Since business slows down during downturn, you get an opportunity to strengthen ties with your existing customers. You get to spend more time meeting and listening to your core set of customers. In the process, you nourish the relationship and get invaluable insights.
  4. Since cost control is an unavoidable phenomenon during economic downturns, you get an opportunity to deeply look at all your existing processes and systems. Chances are there that you chance upon a large chunk of garbage which you might have missed noticing during good times. So, bad economic times may act as a time to do some internal cleaning and shredding.
  5. In search of optimization and synergy to derive maximum mileage you tend to collaborate more with your supplier, customers, employees, other stake holders. The exercise generally unlocks a lot of value in the entire value chain.
Isn't it that adversity comes so that you are forced to improve and learn to benefit from it!

"In the end, all business operations can be reduced to three words: people, product and profits. Unless you've got a good team, you can't do much with the other two."

- Lee Iacocca

October 20, 2008

Hajmola goes to dhabas!

Posted by Bizaholic | 10:11 PM | with 0 comments »

Who doesn't know Hajmola in India? The chatpati goli is a favourite of majority of Indians. Afaqs reports that Hajmola has initiated a new initiative for increasing consumption. The brand is tapping the ubiquitous road side food eateries to position itself as a 'must have' after meals. It is trying to enter the post meal segment currently occupied by 'mint' and 'saunf'.

It is a brilliant marketing strategy for the following reasons:
  1. It helps in repositioning Hajmola as a 'post meal necessity'. Hajmola's current positioning is that of a digestive product which you eat if you have eaten too much. If successful, this single marketing stoke would expand the consumption universe.
  2. Hajmola is loved by majority of Indians (I am assuming). This marketing campaign increases visibility and reinforces brand benefits to give you one more reason to pop it in your mouth after every meal.
  3. Campaign through road side eateries and planned association with hotels & restaurant chains supplemented by an integrated marketing campaign would gradually induce a habit of "Hajmola after every meal". Habits die hard and marketer laughs all the way to the bank!
Hats off to the marketing team handling Hajmola.

When economic downturn comes, there is a natural tendency to tightly pull the strings of management. This includes more centralization in decision making and curbing the powers of managers down the line. The line of thought that goes into all this is – crisis requires bringing in a sense of stability and for that, wisdom of experience matters more that creativity and talent of lesser experienced people. But this may not be the right line of thinking!

Even in situations of economic crisis, perhaps the better option would be to go for higher decentralization and empowerment of the people. The reasoning is simple. Better decision making is always done by –
  1. People who are closer to where the action lies.
  2. Small groups which bring in diversity of thought to analyze the situation and solve the problem.
Since economic crisis often requires nimble footedness and quick action orientation to react to ever changing market dynamics, it is important to empower the people down the line to call the shots. Apart from speed of action, people who are at the front are more likely to come up with innovative ideas to tackle a given situation. During bad times, out-of-the-box ideas are vital for survival and an empowered rank and file is a healthy breeding ground for such ideas. If decision making is too centralized, it is bound to take time and by the time decision is taken it is highly likely that damage has been done.

Another thing to keep in mind is that people deliver better when they feel a sense of ownership. Tightening the strings to bring in more centralization would result in people becoming mere implementers down the line. This may impact the motivation level. At times of crisis, motivation level of your people can be a differentiating factor in delivering results and surviving the crisis. By keeping people empowered you can bring in the sense of ownership and boost the motivation level of your workforce. This, in turn, would a long way in navigating the rough waters with courage and conviction to not only survive but thrive too.

It is said that tough times call for tough decisions. Perhaps a correction is required in this belief. Tough times call for bold decisions. Empowering your people and discouraging the natural desire to increase control is one such bold decision in managing through turbulent times. It may not go well with the rational mind but then all bold decisions don't go well with rational mind.

"Comfort is not the objective in a visionary company. Indeed, visionary companies install powerful mechanisms to create discomfort - to obliterate complacency - and thereby stimulate change and improvement before the external world demands it."

- Jim Collins & Jerry Porras in Built To Last

October 19, 2008

Being a hands-off manager in an organization with predominantly hands-on management culture can be a frustrating experience at times. Surprising as it may seem, even in this age of knowledge worker, rampant micro management and repulsion for anything hands-off or true empowerment is prevalent in many organizations. For old timers it may not mean much as they have been living under the shadow of micro management for most of their professional career, but for the younger generation this hands-on approach is a bit uncomfortable.

The biggest problem with hands-on approach is that it prevents development of people. Instead of mentoring and coaching, a better part of the manager's time is spent in criticizing and judging people. Empowerment takes a back seat and command and control becomes a norm.

People become mere implementer of ideas they don't own. This often results in poor quality of output. People engagement suffers. They don't feel like partners in creating something bigger and better. Instead, they feel like running errands for their managers. All these work like creativity killers in the organization and act as major hindrance in an organization's quest to reach its true potential.

Isn't it time for shunning hands-on management in favour of hands-off management? Ingraining hands-off management culture in an organization's DNA would go a long way in –
  • Developing people through mentorship and coaching.
  • Increasing creative problem solving throughout the organization.
  • Speedier and more effective planning and execution through empowerment.
  • Spreading new ideas.
  • Developing a learning organization.
  • Decline of organizational politics.
  • Attracting and retaining talent.

New products are always important for a company as they are the future cash cows. A constant flow of new products which get accepted by the consumers is key to any company's health. But at the same time, if new products and their development is not managed properly, they turn out to be resource guzzlers rather than revenue generators.

Here are a few tips on managing your new product development process so that new products emerge to become assets rather than liabilities:
  1. There is difference between a planned baby and a one night stand baby. Never think of investing your time, energy, and resources in a new product unless you are sure consumers would buy it. Just because something catches your fancy is not a good enough reason to bring in a new product.
  2. Developing new products is like planning your babies. You must assess the needs of your new products and plan for adequate resources to make sure that after their birth they survive and thrive in the big bad world.
  3. Don't rush. Let the new product follow the complete evolutionary process. It takes 9 months for a human embryo to develop into a fully developed baby. Let your product idea follow the complete developmental cycle before you throw the baby out of the incubator into the hands of consumers.
  4. Just like you keep a time interval between two babies, keep a reasonable time lag between launch of new products. This will ensure that the newly born product gets proper attention and care by all stakeholders. This will help in proper growth and health of the new product. If you throw too many new products in quick succession, chances are high that attention of the management would get divided and too many weak children you will have around you. This is particularly true for established companies with a well entrenched product portfolio. The over stretched sales and marketing team is mostly preoccupied with established products (cash cows and stars) and if you thrust too many new products in quick succession, your sales team gets bewildered. Ultimately, divided attention from sales team would ensure failure rather than success kissing your feet more often.
To sum up the whole thing, there is only one rule for managing new product development. The rule says - "whenever you are faced with a question or a decision about any thing related to new product development, ask yourself what would you do had it been your baby and not a product."

"The empires of the future are the empires of the mind."

- Winston Churchill

October 18, 2008

"Failing organizations are usually over-managed and under-led!"

- Warren Bennis

October 17, 2008

"The leaders who work most effectively, it seems to me, never say 'I'. And that's not because they have trained themselves not to say 'I'. They don't think 'I'. They think 'we'; they think 'team'. They understand their job to be to make the team function. They accept responsibility and don't sidestep it, but 'we' gets the credit.... This is what creates trust, what enables you to get the task done."

- Peter Drucker

October 16, 2008

When faced with imminent economic downturn, often the first response of management is to cut marketing budget. But is it the right response? It is not.

Economic downturn brings many woes. Cash flow becomes tight and costs escalate. So curtailing marketing budget is on top of the agenda to cut costs and manage the bottom-line. But you do this when you consider marketing as a cost head. This is a major flaw in thinking.

Busting a few marketing myths would go a long way in not only managing the economic downturn but profiting from it.

Myth #1: Marketing is a cost
Reality: Marketing is an investment. Good marketing is like nourishing a plant into a fruit bearing tree. Its effects last a long time. This is of much significance during economic slowdown when your competitors are more likely to stay dormant. By investing optimally, you have a fair chance to impress the consumers as there is less clutter during slowdowns owning to likely budget cuts by your competitors. Even if the consumers doesn't purchase now, she in all likelihood would consider you when good times come back.

Myth #2: For effective marketing you need big money, which in turn is scare during economic slowdown.
Reality: Marketing is more of a mind game rather than money game. It's like a game of chess where everything depends upon how you position your pieces to control the squares and checkmate your opponent. Today, Web2.0 has enabled a marketer to indulge in low cost marketing to create buzz around the brand and create word of the mouth marketing structure. All you require is a little creativity along with understanding of various technologies and tools available to do virtually free marketing.

Myth #3: Mass media vehicles are the most impactful
Reality: New economy offers multiple media vehicles which create a multiplier effect. Gone are the days when only real vehicles were electronic media and print media. Today, impact comes from an integrated approach which is not only highly cost effective but also highly targeted. For examples, in India there are >225 million mobile phone subscribers. By tying up with mobile service providers you can reach a higher percentage of your target audience at a fraction of cost required to reach them through mass media. Similarly, through effective use of blogs, internet communities, and social networking sites you can reach your target audience virtually free of cost! Even PR is highly effective in reaching target audience at much cheaper cost than mass media.

Myth #4: Marketing team and advertising agency are drivers of marketing
Reality: Marketing is a multi-dimensional game with multiple players. It cannot be limited to marketing team and advertising agency if it has to reach its true potential in to build brands. Today, in a web2.0 world, marketing is evolving as a consumer controlled process rather than a marketer controlled process. Marketers are increasingly emerging as moderators who guide the interaction between a brand and its consumers. In the new paradigm, the most important thing for a marketer to do is to create an ecosystem where they co-create value with consumers. Also, an often overlooked aspect of brand building is the potential role an employee could play. Employees can act as walking talking brand ambassadors to the world to create a viral effect about the perception of a brand. Marketers must learn to tap into them.

To cut the long story short, marketing is all about mindset. If mindset and attitude is right, then ways to do cost effective marketing are endless and limited only by a marketer's thinking and creativity!

A colleague asked for my views on the reported lay-off at Jet Airways affecting around 1900 employees.

Well, it is unfortunate. No doubt in that.

But perhaps that was a necessity to manage the economic downturn. Just as massive job creation happens when economy is rapidly growing, there is a serious possibility of lay-off when the economy goes into a tailspin after a long period of prosperity. Economic activity, by nature, is cyclical. Neither good things nor bad things last forever. Lay-off is a reality that has to be faced sometimes. There is no escape.

At the same time, lay-off needs to be handled with utmost fairness and sensitivity as it affects lives. Serious efforts should be taken to minimize pain for the employees who are being laid-off.

Lay-off can be made more human by keeping in mind the following:
  1. Communicate the decision on a personal level, preferably through a face to face meeting. Avoid email or SMS to communicate it.
  2. Bring empathy to the table.
  3. Clearly communicate the reasons behind lay-off.
  4. Be well prepared to answer the question: "Why I?"
  5. Don't utter a single word that can hurt the self-confidence of the person being laid-off. Instead, focus on building his confidence by reminding of his unique strengths and how they can be utilized in other companies/ industries.
  6. Offer to help in personal capacity and to provide references, if you can, for helping in getting a new job.
  7. Provide reasonable notice period and severance package to help him through the crisis.

It would still hurt but definitely the pain would be lesser and manageable.

"Focus on a few key objectives ... I only have three things to do. I have to choose the right people, allocate the right number of dollars, and transmit ideas from one division to another with the speed of light. So I'm really in the business of being the gatekeeper and the transmitter of ideas."

- Jack Welch

October 15, 2008

"I believe the real difference between success and failure in a corporation can be very often traced to the question of how well the organization brings out the great energies and talents of its people."

- Thomas J. Watson, Jr.

October 14, 2008

"Outstanding leaders go out of their way to boost the self-esteem of their personnel. If people believe in themselves, it's amazing what they can accomplish."

- Sam Walton

October 13, 2008

Life is harried. Time is short. Priorities are many. Well, this is the new reality of life. To cope with this shifting pattern of life, hybrid is the way to go. This is of particular relevance for marketing. It seems that anything that can mix a couple of benefits simultaneously will emerge a winner.

Take the example of newspaper. How much time does a busy guy has to read newspapers in depth? Not much. Yet, he has a need to feed on news and views. So a 'charticle' comes to the rescue by presenting an article in form a chart that's easy to digest without needing undivided attention that is prerequisite to reading an in-depth piece of article. I searched the term 'charticle' on internet and was surprised to find that some of the leading newspapers are frequently using it to present news and analysis. In India, Mint frequently uses 'chaticle' to present bite size stuff to its readers. This can surely emerge as a game changer for print media in this age of mobile phones and internet where short is considered sexy.

Imagine a harried professional who is always on the go. The guy wants to keep enhancing his professional knowledge but lacks the time it requires to go through serious and detailed books & periodicals. Anything that takes care of his developmental needs through the entertainment mode is bound to get his attention. Here comes 'edutainment' – seriously entertaining but educating too. Think Seth Godin and his ever growing popularity. He is the master of 'edutainment' – be it through his blog or the easy to read books he keeps writing. The point is – if you can educate me by entertaining me, I am going to be at your fan.

With the intrusion of internet in almost all aspects of our life, anything that is free is in demand. Paid services are abhorred. But any business needs circulation of money in its veins to survive and flourish. To eliminate this contradiction, the concept of 'Freemium' emerged making basic services free while charging for advanced services or added features. It indeed works, particularly in internet economy. As a rule of thumb, 95% of the customers stay glued to free services while 5% opt for paid services with added features. Since, it hardly costs anything substantial to keep the 95% customers in an internet economy, 5% paid subscribers ensure healthy circulation of money in the system!

Ever thought why Hinglish has become so popular in India. Simply because it is fun to speak and understand and doesn't require much strain on the brain to navigate through grammatical mine fields. It has become a great leveler in bridging the multi-storied divides in India. No wonder marketers and advertising agencies are increasingly falling on Hinglish to tell the brand story that cuts across consumers segments.

So, what's your idea of innovative clubbing of benefits that's hard to resist. Meanwhile, I bet if someone starts a brunch service in a business district, it would rock!

In the emerging concept of a market, the focus is on consumer-company interaction – the roles of the company and the consumer converge. The firm and the consumers are both collaborators and competitors – collaborators in co-creating value and competitors for the extraction of economic value.

- C K Prahlad & Venkat Ramaswamy in The Future of Competition

October 12, 2008

"Profit in business comes from repeat customers, customers that boast about your project or service, and that bring friends with them."

- W. Edwards Deming

October 11, 2008

"If you pick the right people and give them the opportunity to spread their wings and put compensation as a carrier behind it you almost don't have to manage them."

- Jack Welch

October 10, 2008

"One does not 'manage' people. The task is to lead people. And the goal is to make productive the specific strength and knowledge of each individual."

- Peter Drucker

October 9, 2008

A report says that advertising on social media is on the rise. With slashing of advertising budgets and imminent threat of a slowdown, companies are looking for alternative routes to advertise their products and services in a cost effective way. Social media is turning out to be a boon for them if their target segment is predominently youth having good exposure to internet.

My take is that in 2-3 years time, social media would make a serious dent to the traditional advertisement pie. It is going to emerge as a key media vehicle having the same weight as TV and print media.

"Real leaders, I have found, exhibit an enthusiasm for selecting people who are better than they are."

- Ram Charan

October 8, 2008

Indian DTH space hotting up

Posted by Bizaholic | 9:18 PM | , , with 0 comments »

With Airtel's foray in DTH services, the DTH arena is hotting up. In August this year, Reliance ADAG entered this segment with the launch of Big TV. With Airtel's entry, it's a clash of titans now. The Ad ware has already started and if recent ads of Airtel digital TV and Big TV are are any indications, it is taking virtually turning into the infamous cola wars.

Already Rs 30-40 crore is being pumped up every month in advertisemnt forthis category by the existing players making it one of the costliest product segment.

The growing competition in this category must be a cuase of worry for market leaders - Dish TV and Tata Sky. Meanwhile, Dish TV is tieing up with ICICI Bank to launch interactive banking services. It seems to be a good strategy to climb up the value ladder when faced with me-too kind of mindless competition, particularly when you are an early market leader.

For Airtel and Reliance ADAG, entering the DTH segment and playing aggressively to capture significant market share is an apt strategy. They are already significant players in telephony and broadband business. By becoming a significant player in the DTH segment, they would be in the best position to reap the benefits of emerging convergence of mobility, internet, and entertainment.

An interesting marketing battle to watch out for!

About Us

Posted by Bizaholic | 8:10 PM with 0 comments »

Bizaholic is run by a team of Sapna and Mayank. Sapna is the owner of Bizaholic and responsible for ideas, design and maintainance. Mayank, an experienced management profesional, is the editor and responsible for the content.

We have a dream to make this a collaborative site for lovers of business and management to share and learn from the experiences and thoughts of one another.

Bizaholic is a work-in-progress. You are welcome to contribute to make it GREAT.

You can reach us at bizaholic@gmail.com

Welcome Note!

Posted by Bizaholic | 8:09 PM with 0 comments »

Welcome to Bizaholic!

Why this blog? Well, the thought is to make it a happening place for all the lovers and life-long students of business. It's going to be a place to learn and share news, views, trends, insights et al on anything and everything related to the world of business.

It's just a start. Let's see how it evolves in coming days.
Your feedback and suggestions to improve this blog are welcome. Please mail them at bizaholic@gmail.com

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