MARCH 2013
A Smart Pre-launchTrick
Page 51
EPIC GYA AN
Epic
RAVINDER RAO
The Magazine for Growing Companies
Gyaan
FOUNDER ARUNJYOTI ENTERPRISES
on what it took to build the No. 1 company on our list of India's fastest growing, midsize firms Page 44
BUSINESS LESSONS FROM INDIAN MYTHOLOGY, COURTESY DEVDUTT PATTANAIK,
ASHWIN SANGHI AND R. PILLAI PAGE 36
NEW RESEARCH
The MAGAZINE for GROWING COMPANIES
What Your Employees Want Most Page 20
THE WAY I WORK
THE RIDE OF A LIFETIME Page 56
March 2013 | 150 | Volume 04 | Issue 02 A 9.9 Media Publication | inc.com Facebook.com/Inc
@inc
Hitendra Chaturvedi, founder, RLC, wants to save $14 billion worth of defective and returned goods from going to the scrap heap.
contents
March 2013
Always On The Go Hitendra Chaturvedi of RLC travels 20 days a month to meet clients, investors and people at his company’s 15 offices across India.
56 The Way I Work 36 The Chants of Success
Three bestselling authors on what entrepreneurs can learn from India’s ancient epics, mythologies and other texts. as told to ira swasti
44 How I Did It Inc. India 500, 2012: The No. 1 Company
How P. Ravinder Rao grew Arunjyoti Enterprises, which owns the Taaza brand of convenience stores, at an astounding 1,231 per cent.
Hitendra Chaturvedi, founder of Reverse Logistics Company, does not want his company to be a congregation of “yes men”. He is not afraid to admit what he does not know and likes to hire people who can challenge him. as told to sonal khetarpal
as told to sonal khetarpal
60 I Wish I Knew Then...
C.V. Subramanyam, chairman and MD of Cigniti Technologies, has learnt two key business lessons while building his IT business. One, don’t spread yourself too thin. Second, make sure you decentralise power in a business.
This edition of Inc. magazine is published under license from Mansueto Ventures LLC, New York, New York. Editorial items appearing on pages 20, 22, 29-30 and 34 were all originally published in the United States edition of Inc. magazine and are the copyright property of Mansueto Ventures, LLC, which reserves all rights. Copyright © 2009 and 2010 Mansueto Ventures, LLC. The following are trademarks of Mansueto Ventures, LLC: Inc., Inc. 500.
2 | INC. | march 2013
on the cover
Hitendra Chaturvedi, founder, Reverse Logistics Company. Photograph by Subhojit Paul. Design by Anil VK. Imaging by Peterson PJ
Photograph by subhojit paul
as told to sonal khetarpal
contents
March 2013
15
26 12
29
10 Editor’s Letter
12 Behind the Scenes
Martial arts, Chinese monks and a grand stage—companies that brought these three together for the spectacular The Legend of Kung Fu show
15 Launch
A toast to the 2012 Inc. India 500 honourees Your company has a brand name. Great! Do you? The Inc. Data Bank: What employees really want A Skimmer’s Guide to Tipping Sacred Cows, by Jake Breeden
4 | INC. | march 2013
22 Get Real
By Jason Fried How building a business is like pruning an apple tree
24 Innovation
A device worn as a watch, but works like a smartphone
26 All Things People
By Hari TN Why you need your managers to be entrepreneurs, and what to look for when you hire them.
29 The Goods
Business-friendly tablets Testing out backup batteries Online customer service tools Tech Trends: New ways to swap contact information, by John Brandon Web-based services for acclimatising new recruits
strategy 51 marketing How a new detergent company created a market for itself—even before its launch.
inc.com
Contents
the best of inc.com
Form IV
Statement of ownership and other particulars about the publication INC. as per Rule 8.
personal productivity
A Better To-Do List Inc.com columnist Minda Zetlin shares a few tips on making a dent in your dreaded to-do list.
1. G et moving.
Don’t let the things with the most immediate deadlines dominate your workday. Consider which tasks will best advance you toward your most important goals.
2. S et your priorities.
Decide on the three most important things for the day. Make time for such items, even if other things are pressing.
1. Place of publication
Nine Dot Nine Mediaworx Pvt. Ltd. A-262, Defence Colony, New Delhi-110 024
2. Periodicity of its publication
Monthly
3. Printer’s name Nationality (a) Whether a citizen of India? (b) If a foreigner, the country of origin Address
Anuradha Das Mathur Indian Yes N.A. A-262, Defence Colony, New Delhi-110 024
4. Publisher’s name Nationality (a) Whether a citizen of India? (b) If a foreigner, the country of origin Address
Anuradha Das Mathur Indian Yes N.A. A-262, Defence Colony, New Delhi-110 024
5. Editor’s name Anuradha Das Mathur Nationality Indian (a) Whether a citizen of India? Yes (b) If a foreigner, the country of origin N.A. Address A-262, Defence Colony, New Delhi-110 024 6. Names and addresses of individuals who own the newspaper and partners or shareholders holding more than one per cent of the total capital Pramath Raj Sinha N-154 Panchsheel Park, New Delhi 110 017 Vikas Gupta C-5/10 Safdarjung Development Area, New Delhi 110 016 Asheesh Kumar Gupta 103, Tower II, The Palms, South City-1, Gurgaon 122 001 Anuradha Das Mathur C-144, Sarvodaya Enclave, New Delhi 110 017 Kanak Ranjan Ghosh BH-44, Sector II, Salt Lake City, Kolkata 700 091 Helion Venture Partners India II, LLC Les Cascades Building, Edith Cavell Street, Port Louis, Mauritius TVS Shriram Growth Fund I JE JayaLakshmi Estate #29, Haddows Road, Nungambakkam, Chennai 600 006 And others.
3. R emove the inessentials.
Cut the bottom. Simply eliminating the bottom 20 per cent of your to-do list, on the reasonable assumption that those items aren’t of crucial importance, can help you focus on more pressing items.
8 | INC. | MARCH 2013
I, Anuradha Das Mathur, hereby declare that the particulars given above are true to the best of my knowledge and belief.
Dated: 1st March, 2012
Sd/Signature of Publisher
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editor’s letter
MANAGING DIRECTOR: Dr Pramath Raj Sinha Printer & Publisher: Anuradha Das Mathur Editorial managing Editor: shreyasi singh assistant editor: Sonal Khetarpal feature writer: ira swasti DEsign Sr. Creative Director: Jayan K Narayanan Sr. Art Director: Anil VK Associate Art Directors: Atul Deshmukh & Anil T Sr. Visualisers: Manav Sachdev & Shokeen Saifi Visualiser: NV Baiju Sr. Designers: Raj Kishore Verma Shigil Narayanan & Haridas Balan Designers: Charu Dwivedi, Peterson PJ Midhun Mohan & PRADEEP g nair MARCOM Designer: Rahul Babu STUDIO Chief Photographer: Subhojit Paul Sr. Photographer: Jiten Gandhi community team assistant product manager: Rajat gupta Sales & Marketing senior vice president: krishna kumar (+91 98102 06034) business development Manager: arjun sawhney (+91 95822 20507) assistant regional manager (south & WEST): rajesh kandari (+91 98111 40424) Production & Logistics Sr General manager (Operations): Shivshankar M Hiremath Manager Operations: Rakesh upadhyay Asst Manager (Logistics): Vijay Menon Executive Logistics: Nilesh Shiravadekar Production Executive: Vilas Mhatre
Logistics MP Singh, Mohd. Ansari OFFICE ADDRESS nine dot nine mediaworx Pvt Ltd A-262, Defence Colony, New Delhi–110 024 For any queries, please contact us at help@9dot9.in Published, Printed and Owned by Nine Dot Nine Mediaworx Private Limited. Published and printed on their behalf by Anuradha Das Mathur. Published at A-262, Defence Colony, New Delhi–110 024 printed at Tara Art Printers Pvt ltd. A-46-47, Sector-5, NOIDA (U.P.) 201301 Editor: Anuradha Das Mathur
Of Gyaan and Growth Undoubtedly, what I value most about editing Inc. India is how much I get to learn everyday—
about people, their businesses, and ideas I would’ve never thought possible. Despite the constant learning, for me, few issues have been as full of business insights as this one, thanks to the fascinating cover story by Ira Swasti. In The Chants of Success on page 36, three popular authors—Devdutt Pattanaik, Radhakrishnan Pillai and Ashwin Sanghi—whose books are based on ancient Indian texts or inspired from our rich mythology tell us how our cultural heritage and belief systems shape the way we approach business. There is a wealth of wisdom in this feature, including why businesses in India are “relationship” and not “process driven”; why our workplaces are more inclusive but also more chaotic, and why as a culture we do not strive for excellence enough. This is powerful gyaan for anybody. But, for entrepreneurs looking to establish practices and values that are both sustainable and productive it is gold. In this age of fast-changing realities, business builders know that simply force-fitting Western models of management on Indian situations is neither advisable nor likely to work. Equally, it’s important to be conscious of the possible traps Indian companies are culturally attuned to stumble into. It’s only fitting that we put this package together in this month as we get ready to award and celebrate the honourees of the Inc. India 500, 2012 (our annual ranking of India’s fastest-growing enterprises under `1,500 crore). We hope a look into our shared past will help propel their growth stories of the future.
Shreyasi Singh shreyasi.singh@9dot9.in
10 | INC. | march 2013
BEHIND THE SCENES
Companies at the Heart of Everyday Life
Digital marketing
The onus of bringing throngs to Nautanki Mahal, Kingdom of Dreams for the show, The Legend of Kung Fu was on the Noida-based digital media company, Iffort. Started by Daksh Sharma and Sunny Jindal in 2010, this 20-people firm took the show to a whole new digital level with the integration of a booking tab on Facebook, and the I Am The Legend Of Kung Fu contest. Iffort has earlier worked on promoting Groupon’s LOLympics, Wrangler’s True Wanderers and Fever Entertainment’s Ben 10 live shows.
Posters
The visually stunning, larger-than-life posters of the show have been printed by Shree Sai Advertising and Marketing, a Noida-based company, founded by Sanjay Gupta in 2007. Manufactured in the dimensions of 60 x 6 feet and 15 x 8 feet, Shree Sai’s posters of the show bring alive the stunning choreography of the Chinese monks. The 20-people firm also designs and prints advertising material like signages and hoardings for companies such as Yamaha and Honda.
12 | INC. | MARCH 2013
The Legend of Kung Fu
30.01.2013 6 p.M.
Stage show organiser
The company credited for bringing this internationally renowned Chinese martial arts and cultural show to India is Arya Carnivals. Founded by Deepak Bahl in 2012, the company has purchased exclusive rights for five years from Beijing-based performing arts company, China Heaven Creation for the show. The company’s 18-people team was responsible for the lodging and transportation of the 55 artists and kung fu practitioners to India.
Air conditioning
Optimum temperature and proper ventilation is a must at any indoor event. The central air conditioning system at the Kingdom of Dreams is installed by Sterling and Wilson. Essentially an electrical contracting company, the family business, that was started in 1927, is now headed by Khurshed Daruvala. With more than 2,200 employees, this `1,500-crore company has worked for giants like Tata Group, Citibank, Dell and Intel.
photograph courtesy Kingdom of Dreams
reported bY Sonal khetarpal
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And the Award Goes to… The Inc. India 500 class of 2012 March is a special month for the team at Inc. India as we all come together to celebrate the growth powered success of India’s fastest-growing mid-size companies—better known as the Inc. India 500, 2012 class. These awards are part of the fourth edition of our annual rankings—our concerted effort to recognise and encourage entrepreneurial successes from the mid-size segment of corporate India which often fails to get its deserved attention. For these rankings, the chosen companies were picked independently by our research team from its in-house database along with companies that registered through an online campaign launched in February 2012. For more details of the ranking methodology, please see box (on next page). Unsurprisingly, this ranking squarely mirrored the three distinct characteristics of the current economy—diversity, transition and slowdown. And each of these characteristics is visible in the sectoral break-up, the nature of business MARCH 2013 | INC. | 15
A skimmer’s guide to the latest business books
The book: The Top 10 Distinctions Between Entrepreneurs And Employees, by Keith Cameron Smith. The big idea: Do you behave like a high-performing employee even as you run a business? Successful entrepreneurs know how to embrace their personal and professional failures to make them their most empowering learning experiences, unlike employees at the workplace. The backstory: Smith is an entrepreneur and an inspirational speaker. His last book, The Top 10 Distinctions Between Millionaires And The Middle Class, is about the mindset of self-made millionaires and the habits that anyone can master to become one. If you read nothing else: Secret 9 removes some of the fear and stigmas attached with failure. By relating the experience of a business failure he went through—from blaming his partner to fully accepting responsibility for it—the author manages to convince you of the merits of failure. Secret 6 lays down an essential management technique to motivate employees—praise, correct and then praise again. Rigour rating: 7 (1=Who Moved My Cheese?; 10=Good to Great). The Top 10 Distinctions Between Entrepreneurs And Employees is a quick guide on how to change attitudes to make it big in the business world. Though the author does not provide any life altering advice, his usage of personal experiences makes it an easy read for aspiring as well as thriving entrepreneurs to relate to and learn from. —I.S.
16 | INC. | MARCH 2013
that these companies have embraced and their performance from April 1, 2007 to March 31, 2011. Taking top spot in our sectoral ranking was the food and beverage sector that raced up to the Inc. India 500 charts for the first time since we began our rankings in 2009. Another big change—from a combined growth rate of 143 per cent in 2010, the combined growth rate of our 500 honourees in the 2012 edition was a modest 41 per cent. Also, even as 124 companies from last year’s ranking continued to be on the list, this year’s ranking saw 376 debutantes, including our top company, Arunjyoti Enterprises, for
RANKING METHODOLOGY We assessed independent Indian companies with sales turnover (positive sales growth for the last three years) between `50 crore and `1,500 crore. If the company belonged to a group, the group did not exceed `1,500 crore, as of FY 2010-11.
instance. It’s the fastest-growing company on our list with a whopping 1,231 per cent growth rate over the past three years (and this month’s How I Did It). Yet, many of our readers might not have even heard of this `79-crore company that owns Taaza, the grocery retail chain in southern India. Go to page 44 to read P. Ravinder Rao’s exciting journey, and his ambitious plans for the future. He isn’t alone in weaving a future full of promise and grand plans. As we chronicle 500 stories of growth each year, we’ve seen that to be a winner requires focus, vision and determination. Yes, sometimes the risks might not work, as is evident from the constantly changing mix of companies in our list. But, it is this vibrancy that makes tracking these companies both exciting and rewarding. —Inc. India
Top 10 sectors: Sectoral share in inc. india 500 (%) 5.6
11
Chemicals Food & Beverage
4.8
9.2
Drugs & Pharmaceuticals
IT & ITeS
4.2
8.6
Plastic Products
Steel & Ferrous Metals
3.6
8.4
Auto Ancillaries
3.2
Real Estate & Construction
Import & Export
8 Textiles & garment
Average Growth rate (%) OF THE iNC. iNDIA 500 Honourees 143.46 2010
62.45 2009
52.7 2011 41.00 2012
launch
That’s Brandtastic! Why your personal brand is the soul of your business Brand strategist Tanvi Bhatt started Panache, a Mumbai-based personal branding studio, in November 2007 to groom corporate honchos of India Inc. In these five years, she has authored several articles on personal branding and worked with clients such as the Times Group, Blue Star India and Angel Broking. In a conversation with Inc. India’s Ira Swasti, Bhatt delves deeper into why building a company’s brand is not enough for entrepreneurs; and why they need a strong personal brand to create a “brandtastic” experience for their customers. Tanvi Bhatt Brand Strategist
Q: Why is it important for an entrepreneur to build a personal brand if she already has a strong company brand? A: In this age, people have access to a lot of
information. They want to know who the person behind the organisation is, and how her values and passions drive the business. So, an entrepreneur needs to be a brand in herself and be able to say—this is who I am, this is what I believe in, and this is how I embed my ethos and values into the organisation. Brands like Coca Cola or Reebok survived without their owners having popular brands because they were from a different era. Today, you can’t imagine Facebook without Mark Zuckerberg or Apple without Steve Jobs. Q: What does personal branding entail? A: A personal brand is the value an entrepre-
neur adds to society or to the business. It is not as much about knowing how to dress or talk as it is about discovering what you’re really good at, and what drives you as a person. To help entrepreneurs discover that, I ask them questions such as—what are the three most important values in your life that you would not betray at gun point? Or, what’s the one thing you would do even if you were not paid for it, or what keeps you awake in the middle of the night? Knowing is not enough though. You need to communicate your unique skill or ability, which could be a passion for writing, a sport or anything else that makes you “you”—to other people. Some personal branding communication strategies include webinars, attending events where you 18 | INC. | MARCH 2013
share your success as well as failure stories, and mentor new start-ups in your domain. Q: What’s the difference between your personal brand and the company brand? A: Ideally, nothing. Your company should
really echo your values and ethics as an entrepreneur. Only then you will be able to grow the organisation with the vision you had in mind. But simply put, an entrepreneur’s personal brand is about who she is, what she believes in, what are her goals and vision while an organisation is a much bigger entity which stems from the entrepreneur’s vision. For instance, one of the most revered entrepreneurs in India, Mr. Nandan Nilekani, has built such a powerful brand that he now represents the futurist face of brand India via the UID initiative. It is the power of his personal brand and repute which has bestowed him with the honour of leading India towards a tech-empowered tomorrow. This is the true celebration of his personal brand, his legacy.
Q: Why do you say personal brand is about reputation and not image? A: Reputation extends from your perfor-
mance. It’s the experience people have in mind after working with you. On the other hand, the concept of image is an impression that you wish to create on your target group’s mind. Now, this may or may not be authentic. This is what you want people to think about you. Just by walking well, speaking well, you will be creating an image which may be misleading for your own brand and may do more harm than good to your credibility.
Q: Should your personal brand ever become more powerful than your company’s brand? A: Why not! There are three important rea-
sons for that. First, people connect with people more than they connect with organisations. Second, your personal brand establishes credibility via your interactions with people, and once that happens, your brand becomes a force to be reckoned with. And third, it creates a promise of consistency in your performance which goes beyond your company. Your personal brand is the only legacy that will go with you, if you decide to start something new again. It is why people will invest in you again, after you’ve proven your style and work ethics. For instance, Bill Gates is Bill Gates even though he’s not a part of Microsoft anymore. Q: What do you need to build a personal brand? A: The most important thing an entrepre-
neur needs to know to start building her brand are the three Cs—clarity, consistency and constancy. Clarity in what makes your brand unique. A clear and focused brand promise is the secret of a good personal brand. Consistency in communicating your brand’s promise is the next step. You have to be consistently visible and available for your audience to reach out to you and connect with you. In personal branding, the adage out of sight is out of mind is very true. And constancy means you have to deliver your brand’s promise every single time, preferably exceed people’s expectations while doing that.
What makes employees unhappy inc. data bank
A skimmer’s guide to the latest business books
The sluggish economy has kept employees from jumping ship, but a big chunk of the American work force appears disgruntled. One recent report suggests that 86 per cent of employees plan to look for a new job in 2013, up from 60 per cent in 2009. Here’s a look at what’s making workers unhappy—and what they really want. —Matthew Wong
The book: Tipping Sacred Cows: Kick the Bad Work Habits That Masquerade as Virtues, by Jake Breeden.
The backstory: Breeden is on the faculty of Duke University’s executive education program and consults for corporations including Google and IBM. If you read nothing else: Each chapter corresponds to a particular leadership trait. So take a look in the mirror and choose accordingly. Obsessed with innovation? Chapter Four asks whether your creative energy can be better applied elsewhere, such as improving existing products. Crazy for collaboration? Chapter Three points out that most people work better alone. So resist forming teams—or at least make them temporary. Don’t “Just Do It”: Passion becomes destructive when leaders subvert other values, burn out their workers, or dismiss ideas that counter their beliefs, says Breeden. Or when that passion stems from insecurities. He suggests passionate leaders ask themselves, “Am I trying to prove something to myself or someone else?” Rigor rating: 7 (1=Who Moved My Cheese?; 10=Good to Great). Breeden trots out plentiful research results. But, like many consultants concerned with client privacy, he rarely reveals which companies or leaders his anecdotes describe. —Leigh Buchanan
2 0 | INC. | MARCH 2013
Here’s the good news
Most employees are “completely satisfied” with some aspects of their jobs.
What they want most from employers tends to vary, depending on age and gender.
Their co-workers: 69%
Amount of vacation time: 54%
Men
Women
More money: 45% A promotion: 39%
Reduced hours: 51% Flexible hours: 50%
Their boss: 54%
The bad news
The list of top complaints suggests the past few years have taken a toll on workers in a number of ways. Portion of employees who are “dissatisfied” with these aspects of work:
Gen-Xers
Millennials
a Higher job title: 49%
More training: 40%
(ages 32 and younger)
(ages 33 to 50)
In addition to basic benefits, employees asked for some perks.
On-the-job stress: 33%
Health benefits: 31%
free beverages Salary: 28%
18%
a tablet or smartphone for personal use 17%
free massages 8%
All percentages represent the portion of HR managers who received these requests. Source: Gallup
Source: 2012 HR Beat
But experts say real job satisfaction is more than benefits or perks.
“Of all the things that contribute to a happy workday, the one thing that stands out from my research is making progress on meaningful work. Feeling like you are able to move forward on a daily basis engenders real joy.” Teresa M. Amabile Harvard Business School Professor and co-Author of The Progress Principle
amabile: courtesy subject; book: kelly kollar; others: iStock (8)
The big idea: Leaders pride themselves on traits such as creativity and passion. But unquestioned virtues curdle into vices when pursued relentlessly or in the wrong contexts.
Get Real
BY
Jason Fried
Jason Fried is co-founder of 37signals, a Chicago-based software company. He prefers Braeburns.
When Good Ideas Bear Fruit How is a business like an apple tree? Sharpen your pruning shears and find out
2 2 | INC. | MARCH 2013
Light gets in where it couldn’t before. Air circulates better. And new growth appears. If you did the pruning right, you’ve given your tree a stronger foundation for the future. Now, back to my business. A few months after cutting back our product line, something unexpected happened: We sprouted some new ideas. During a discussion about one of our products, a couple of ideas suddenly emerged for new ones. I can’t go into specifics just yet, but one is a variation on an existing product, and the other is entirely new, something we’ve never offered. We’re finishing them up right now and are pretty excited. I am convinced that these ideas never would have emerged had we shied away from cutting some of our old items. Or, to put it in more arboreal terms—as a business, you won’t grow strong new limbs if you don’t prune the old ones. In fact, I believe that a healthy company is like a healthy tree: Well-developed roots (your vision), a strong trunk (your people), and vibrant leaves (your products) work together to convert the sun (revenue) into energy (profits). Hokey? Perhaps. But I often find inspiration in nature. Besides, it’s high time we entrepreneurs stop using those hackneyed sports and military metaphors. But that’s a topic for another day.
Follow Jason Fried on Twitter: @jasonfried.
photos.com
Back in July, I wrote about our efforts to bring more focus and discipline to 37signals by parting ways with some of our older products. We were so committed to eliminating nonessential offerings that we decided to sell a service that was generating $17,000 a month in profit. “We’re a small company with a small team,” I wrote, “and we have to use our resources wisely.” Today, we’re about to launch two products. Both of them are significant departures from the way we usually do things. And we have a bunch of more ideas in the pipeline. Whatever happened to that newfound emphasis on focus? Was that a mistake? Did I change my mind? Let me explain—by telling you about my apple trees. I live in Chicago but own some property up in Wisconsin. There’s an old stone farmhouse, a couple of barns, some majestic oaks, rolling prairie, a river, and a few apple trees. I’ve been trying to learn how to properly prune them. The trees are handsome and healthy, but if you don’t pay attention, they can grow unwieldy and succumb to a variety of ailments. There are any number of reasons to prune a tree. You might do it to make it look prettier. Or you might trim one area in order to favour other limbs. It could be to cut away disease or to prevent a new disease from taking root. It could be to get the tree to generate more fruit. So I’m regularly taking a saw or shears to my apple trees. Sometimes, when I’m done, I step back and am not necessarily pleased with what I see. In fact, a freshly pruned apple tree can be a sad sight, looking thinner and weaker than it did before you started. But that’s an illusion. In almost every case, cutting things back is a way of favouring what is left. You help the tree flourish by picking the winners. What’s more, pruning opens up new opportunities for your tree.
innovation
Companies on the Cutting Edge
“It integrates as an artificial limb of the user, providing the benefits of a fully connected computer.” — Pavneet Singh Puri, co-founder, Androidly
2 4 | INC. | march 2013
Androidly Smart Watch
Androidly
A smart wrist
Simply put, Androidly is a phone miniaturised to the size of a conventional wristwatch. The quartet of amateur tech geeks who developed it—Apurva Sukant, Ankit Pradhan, Pavneet Singh Puri and Siddhant Vats—claim it is the smallest and the lightest smart phone in the world. And, that it allows a consumer to do everything they had been doing with their smart phone on a funky watch. The beginnings of the idea emerged over a casual dinner when Pavneet Singh Puri couldn’t retrieve his phone from his pocket and check his work e-mail because his hands were dripping with curry. It set the four friends thinking about why gadgets needed to be picked up and put down, and why gadgets require both hands to function. It was the proverbial Eureka moment. Now, the smart watch is ready for a market launch. Open source evangelists that they are, the Androidly team has released all their hardware design and software code under unrestricted licenses, hoping that this may serve as the base for future innovations. Till then, gadget geeks can call in some delight by pre-ordering an Androidly—available in all colours—on the company website. Price: $229-269 Composition The display screen has two buttons on both sides. The SIM card is placed underneath the battery. It comes with an in-built USB connector. The Android OS has been optimised for the watch’s 2-inch screen.
Features • Full access to Google Play Store • Weight: 160 gm • Dimensions: 6.4 × 4.2 × 1.45 mm • Processor: 416 MHz • Memory: 256 MB RAM • Removable storage: 8 GB SD included. Up to 16 GB SD • Screen: 2 inch, Capacitive Touch screen with 320 × 240 resolution • Connectivity: Bluetooth 2.0, WiFi B/G • Cellular: 2 GSM network • Camera: 2 megapixel
PHOTOGRAPH BY SUBHOJIT PAUL
reported by sonal khetarpal
All Things People BY
HARI TN
Hari TN is the global head of human resources at Amba Research, a Bangalore-based investment research outsourcing firm.
Are you hiring right? High-growth firms need to build a cadre of “entrepreneur managers” Start-ups usually depend upon spotting an
opportunity and finding a profitable way of exploiting it. Simple as it may sound, this calls for a rare blend of risk taking, action orientation and clear thinking. It sounds almost intuitive that firms attempting to build new businesses need managers with precisely these traits. Firms that are in a high growth phase, irrespective of size, also require managers with these traits. It is therefore extremely important to hire the right managers—what we call, “entrepreneurial managers”, all of whom exhibit the below traits.
1. They can make the right things happen:
In other words, your team members should have the capacity to determine what is right, make it happen, and make it happen quickly. It is helpful to note that all the three ingredients are crucial. Even if one of the three elements is missing, it could result in a fatal handicap that will gradually begin to show. People who can think very clearly, and often strategically, but without the aptitude or ability to make things happen would soon fail. Similarly, enthusiastic doers that can’t think clearly (or in very simple terms do not know what to “do”) suffer from the curse of well executed, but sometimes random pursuits. Determining what is right calls for an ability to think clearly. In a managerial context, thinking clearly invariably boils down to differentiating the few things that matter from the many things that don’t. Having the confidence to steadfastly ignore inconsequential 2 6 | INC. | march 2013
issues and refuse to be distracted is an incredibly powerful trait. Plus, those that think clearly always ask smart questions—questions that can help make a choice, extract the most important issues in a given situation, evoke insight and help get to the root cause. This is different from conventional intelligence. I have seen many conventionally intelligent people struggle to cut through the smoke and noise to get to the key problems.
They are unable to let go of marginal factors. Further, entrepreneurial managers also recognise that “speed” is always of essence. They always demonstrate a sense of urgency, turn around things quickly, take quick decisions and respond quickly to new developments. Often, speed is also a surrogate for energy. You can’t energise unless you have energy yourself. People who set a high pace around them at the work place usually engender a illustration by shigil narayanan
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ALL THINGS PEOPLE
high pace and a sense of urgency. Of course, they make mistakes once in a while, but don’t get dragged down by these mistakes. Those that come in close contact with such individuals feel inspired to take more risks. Therefore, energy is often contagious.
obliquely and end up politicising them. Issues therefore never get resolved. They fester underneath. In strong leadership teams whenever differences arise between two individuals or there is a problem (say customer dissatisfaction), the two individuals con-
Great managers always have stories to tell, or teachable points to share. They encourage their teams to develop points of view. 2. They invariably achieve a perfect balance between delegating and being hands-on
Achieving this fine balance reflects several underlying cognitive and execution capabilities of a good manager. It is common to find senior managers who go to extremes, and extremes are dangerous. What does an ability to achieve this balance indicate? One, it shows that the manager is capable of being hands on and knows what her team is doing. Second, it shows that the manager can prioritise well and understands her real role is to add value by doing things that she is supposed to be doing and not by doing things that her team is supposed to be doing. She will step in to help the team if there is a crisis or if the team has reached a dead-end, in terms of thinking or execution. She will deep dive only to help the team come out of the crisis, or cross the hump to begin cruising again. Average managers take pride in being too hands on or often have an incorrect understanding of what and how to delegate. When they delegate, they often a) do not clearly communicate what is expected or b) do not have the rigour to periodically review whether things are on track or c) are unable to customise the extent of delegation based on who they are delegating to. 3. They nurture insightful conversations
One of the most powerful drivers at a workplace is the collective ability of the leadership to have candid conversations. Strong teams demonstrate this ability. Weak teams avoid conflict, skirt difficult issues, bring them up 2 8 | INC. | march 2013
cerned (say the head of sales and the head of customer service) would discuss the issue transparently with an intention of fixing it, rather than worrying unduly about where the fault lies. In weak leadership teams, the head of sales and the head of customer service would run a whisper campaign to put the blame on each other. Candid conversations are easy to understand, but what are insightful conversations? Insightful conversations are those that often result in “aha’” moments. Great managers always have stories to tell or teachable points to share. They encourage their teams to develop (and share) points of view on a wide range of issues. They realise the power of insightful conversations and create an environment that nurtures such conversations. Through these conversations, they help create clarity and cut through the clutter that obfuscates and consumes attention. Management writers have underplayed, and underestimated, the power of simplicity. The ability to simplify is a terrific strength and can provide an edge. There is often a tendency to come up with complex programs, and complex strategies, because that is much easier than simple programmes and strategies. Simplifying calls for identifying the core issues and making the right approximation. There is a famous saying by Albert Einstein— “Not everything that can be counted counts, and not everything that counts can be counted”. The simplifiers are those that understand what counts in most situations and design their solutions around these. There
can be simplicity in process design, in thinking about cause and effect, or in establishing the key drivers in any given situation. Simplicity comes about only through clarity. And clarity quotient in a team can be enhanced multifold by a manager who can nurture insightful conversations and, in the process, encourage everyone to develop teachable points of view. 4. They don’t hesitate to express themselves, and demonstrate their opinion
Great managers invariably express themselves. They can do that in several ways: a) when they like something, they say so and when they don’t like something they say so too b) by demonstrating through walking the talk. Behaviour in a team is driven less by a lecture from the manager on what her beliefs are than by appropriate strokes (positive or negative) when actions are in line or out of line with those beliefs. For instance, if a manager believes that good execution is critical, she could enhance the quality of execution in the team significantly by pointing out instances of good and bad execution with inputs on what should have been done differently in cases of bad execution and demonstrating good execution herself in every situation. Great managers can provide some hard feedback in the morning and follow it up the same evening with a friendly chat over a cup of coffee. Average managers do not feel confident expressing dissatisfaction when they do not like something either because they do not have the skills to express dissatisfaction at a behaviour or outcome without this rubbing off on the overall relationship with the individual or simply feel uncomfortable in doing this. Whatever the underlying reason, it does not engender high performance. It is not always easy to figure out with a 100 per cent reliability whether someone would demonstrate these traits through a ninety minute interview, but if you know what to look for, you are starting with a huge advantage and there is a much greater probability that you will pick the right candidate.
Contact Hari TN at haritn@ambaresearch.com.
Your Business Toolbox
The Goods
Tablets Are Ready for Business Which one should you pick? For years, tablets have been touted as the Next Big Thing in consumer electronics. Finally, there are several models suitable for serious business use. We tested four tablets, running four different operating systems, to see how they stack up. —John Brandon
Acer Iconia W700
Our top pick, this Windows 8 tablet, which can run desktop versions of Microsoft Office programs, functions much like a laptop. The tablet has a sharp 11.6-inch, 1920- by 1080-pixel display and a speedy Intel Core i5 dual-core processor. It also has front- and rear-facing cameras, as do the other tablets here. During our test, it booted in 10 seconds, and the battery lasted nine hours. On the downside, the 2.1-pound tablet is a bit hefty and has a smaller app selection than do Apple or Android models. cost: $999 for a 128GB solidstate storage drive illustration by raj verma
iPad fourth generation
The sleek 1.4-pound iPad, which runs on Apple’s iOS platform, offers the best selection of business-friendly apps in our test group, including a full-featured version of Square’s mobile cash register. The tablet’s 2048- by 1536-pixel Retina display, which measures 9.7 inches, was crisp and colourful, topping the other models here. Powered by Apple’s A6X processor, it booted up in 20 seconds during our test, and the battery lasted a respectable eight hours on a full charge. cost: $499 for 16GB of storage
Google Nexus 10
A nice travelling companion, this 1.3-pound Android 4.2 tablet comes loaded with Google Now, an app that automatically serves up meeting reminders, flight details and other timely information. Its 10-inch, 2560- by 1600-pixel display looked crystal clear during our test. The Nexus, which is made by Samsung, also includes a near-fieldcommunication chip for transmitting data with a tap. Powered by an Exynos 5 dualcore processor, it booted in 19 seconds. One gripe: The battery lasts only seven hours. cost: $399 for 16GB of storage
Surface with Windows RT
Much like the Acer, this 10.6-inch Windows RT tablet features Microsoft’s new tile-based start screen and has a limited selection of business apps. The 1.5pound Surface offers mobile versions of Office programs, but they are not designed for use by businesses. Powered by a quad-core processor, the Surface booted in 26 seconds, the slowest time among our group. During our test, its 1366- by 768-pixel display looked a bit washed out. The battery lasts eight hours. cost: $499 for 32GB of storage MARCH 2013 | INC. | 2 9
the goods
Products + Services
2.
Go mobile
An app that allows location-based advertising on your cellphone
Developed by Pune-based Shaunak Khire in 2011, Adlibirium is a mobile app that helps small and mid-size businesses, that can’t afford to build company websites, to advertise through mobile-based webpages instead. For creation of ads, the user can either download the app on a smart phone and follow the steps, or use the SMS service to get an automatic graphic ad created based on the inputs. On signing up with the platform, the app creates a mobileoptimised page for the company on its online merchant website called enterprises.me, and guarantees to the point of refund 10,000 to 15,000 ad views in the company’s local area. It also claims to ensure 50-70 clicks for a product business and two to five leads for a services business, each month. The app allows a business to sell and track store cards, loyalty subscriptions as well as take basic orders from its customers. It also gives users reports on sales, clicks and views. On the other end of the business spectrum, it lets customers pay at venue, pay on delivery or through a credit card. This location-based advertising app is currently in its beta version and is priced at $500 a year. —I.S.
3 0 | INC. | MARCH 2013
1.
3.
Power in Your Pocket Putting backup batteries to the test As many people learnt during Hurricane Sandy, a low-battery warning on your smartphone can be panic inducing when you’re in a power outage or simply away from an outlet. Rechargeable battery packs can help by adding hours of juice. Here are three options to consider. —Adam Baer 1. Solio Classic2 Battery Pack + Solar Charger Powered by the sun
2. HyperJuice 2 External Battery
This 10.1-ounce solar battery can power any USB device. To power it up, spread out the panels and angle them toward the sun on a flat surface, preferably outdoors. During our test, it took about 10 hours to charge the Solio on a sunny patio in Southern California. The smartphone-size device fully charged an iPhone 4S in 1.5 hours and charged an iPad 4’s battery from 20 per cent to 40 per cent in about 90 minutes. You can also charge the battery, which lasts for about 500 cycles, in roughly six hours using an included USB cable. cost: $100
This 1.5-pound external battery can simultaneously power a MacBook and any two USB devices, including tablets. The device, which measures 8 inches by 4.8 inches, contains militarygrade lithium-ion cells that last for about 1,000 recharges. During our test, it added 15 hours of battery life to a MacBook and extended the iPad’s battery for more than 24 hours. It took about four hours to juice up the battery, which can then fully recharge an iPhone up to 19 times. One caveat: To charge a MacBook, you must use Apple’s MagSafe Airline Adapter, which costs $49. cost: $300
Powered by lithium-ion cells
3. Eton BoostTurbine2000
Powered by hand crank
The 7-ounce Boost, which is roughly the size of a smartphone, has a turbine and retractable crank that you can turn to generate power. During our test, it took one minute of cranking, at roughly one turn a second, to create enough juice for 30 seconds of talk time on an iPhone 4S— enough for an emergency call. It would take about three hours of cranking to fully charge a phone. But you can also charge the Boost with an included USB cable and use it as a regular battery that fully powers most smartphones in about two and a half hours (sorry, no tablets). The device lasts for about 300 recharges. cost: $60
the goods
Products + Services
help desk
A holistic approach to customer service
Zendesk
When a customer makes contact via phone, e-mail, chat, discussion board, Twitter, or Facebook, Zendesk automatically creates a ticket and places it in one central inbox. Multiple employees can access the inbox and respond directly to customers on various platforms. A dashboard features charts and graphs illustrating customer satisfaction ratings and other metrics. Zendesk, which has apps for a variety of mobile devices, supports 11 languages. cost: Starting at $20 a year for three users, then $29 a month per user Salesforce Desk.com
Much like Zendesk, this service creates a universal inbox for comments from a variety of platforms. It also routes tickets to specific employees according to expertise and availability. On the platform, you can create a database of common responses and include photos and videos. Desk.com, which supports 35 languages, has an iPhone app and works in most mobile browsers. cost: Free for one user, then $49 a month for each additional user or $1 an hour per user
3 2 | INC. | MARCH 2013
Is Your Business Safe? Keeping your data protected all the time It doesn’t matter how big or small the threat is, there are consequences (busi-
ness reputation, legal charges, loss of competitive edge, and other unforeseen damages) of any level of breach of your company’s secured data. Unless you run a completely offline business, chances are that you have a fair amount of interaction with the web, which is rapidly becoming the top infection point for all sorts of security vulnerabilities. But fret not. Here are a few basics to safeguard your data. —Jayesh Shinde, thinkdigit.com. Secure your network and connections
While working from home, how do you ensure that you connect securely to your office server for an urgently required file? Virtual Private Networks or VPNs is the answer, think of it as your very own private, completely secure tunnel through the internet. Windows 7 has a built-in VPN feature which you can explore (just type “VPN” in the Start Menu field) to hook up two computers. You can also check out third-party solutions such as OpenVPN or Hamachi which are free and easy-to-setup.
Don’t ignore encryption
Make data encryption part of your work policy, whether you have two or 20 employees. Every computer that has business data on it should be encrypted at the hardware and software level to ensure that even if a laptop is stolen or lost, the data on it is always encrypted and impossible to recover. Tools that let you do this are TrueCrypt, an open source favourite, and Windows’ own BitLocker utility. Both of them are used to securely encrypt entire hard drive volumes, with or without hardware encryption.
Online backups are critical
It’s important to backup your data at short, fixed intervals before disaster strikes. Cloud-based services provide a cheaper alternative to do this. While there’s nothing wrong in services such as Dropbox.com and Nortonzone.com, we recommend investing in a dedicated service that offers support. You could check out SpiderOak and SOS Online Backup service—the former encrypts and never deletes your data, and the latter offers incremental backup and syncing of data from PCs and attached network drives.
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These days, customer communication comes in many forms, including phone calls, e-mails, and tweets. Whatever the medium, online customer service platforms make it easier to field and respond to questions and complaints. Here are two to consider. —J.B.
the goods
Products + Services
welcoming committee
Welcome New Hires
This service sends an e-mail to newbies directing them to an online welcome page with personal greetings and advice from colleagues. On their first day, employees log on to play basic trivia games about the company’s history, culture, and products. Managers can customise content and track employee progress. cost: Starting at 50 cents per employee AllAboard
A more robust option, AllAboard lets new hires log on to view company videos and slide shows and earn prizes by answering trivia questions. Much like Welcome New Hires, it lets new employees see how they rank on a leaderboard and chat in discussion forums. Managers can log on to view detailed reports on their progress. Unlike Welcome New Hires, the service has apps for Android tablets and the iPad. cost: $30 per employee —Jennifer Alsever
3 4 | INC. | MARCH 2013
tech trends john brandon
New Ways to Make Contact Business card alternatives When I hand out business cards at trade
to my card. But, of the three dozen people I shows and other events, I always wonder if talked to throughout the rest of the day, only they’ll end up on the bottom of someone’s one had an NFC-enabled phone. In fact, bag—or, worse, in the trash. Over the years, most people had never heard of the I’ve tried several smartphone apps designed technology. I had more luck with my QR to exchange contact information, but many of them work only if both people Near-Field Communication have the software installed. How it works: You can transmit contact information Recently, I tried out two by tapping together two products containing NFC chips. promising alternatives, nearAvailable on: Many high-end smartphones, including field communication and QR Androids and BlackBerrys, as well as stickers, tags, codes, at the L.A. Auto Show. and business cards with built-in NFC chips Near-field communication, which now comes standard on QR Codes some high-end smartphones, How THEY work: People can scan QR codes with a wide makes it possible to transmit array of mobile apps to access your contact information. contact information and other Available on: Business cards, stickers, and mobile apps data by tapping another device, card, or tag containing an NFC chip. I tested it using Vizibility’s NFC Mobile Wallet Card, which looks like a code. About a dozen auto-show attendees I plastic business card and contains an NFC approached had QR scanning apps on their chip and a QR code. To create my card, I went phones, which allowed them to pull up my to the Vizibility site, typed in my contact virtual business card. Some people were too details, and chose a design with a stock logo busy to grab their phones, so I gave them (you can also upload your own logo). I signed paper cards with my code. After the show, I up for the premium Metrics Pack, which logged on to Vizibility.com and saw that costs $5 a month, or $49 a year, and includes another dozen people had scanned the code. an NFC card, which was mailed to me, and Not bad! Unfortunately, I could not see their the ability to track activity online. For an extra names or contact details, only their locations. $15, I also purchased 240 QR code stickers to My verdict? Near-field communication is slap on my old-school business cards, making promising, but it may take another year or it possible for people to scan the code two for it to catch on as more phones with with a smartphone app and instantly NFC chips hit the market. I was more upload my information. impressed with QR codes. Now, I can rest As I wandered the aisles of the auto show, easier knowing my contact information is I came across a company rep with an NFCsafely stored in the phones of the people I enabled smartphone. Uploading my contact meet, just a tap away. information was a cinch: He opened the Android Beam feature and tapped his phone illustration by scott menchin
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Looking for a better way to acclimate hires? Here’s the skinny on two web-based services that use games and social networking to streamline the process—and make it fun.
the chants of
success Authors Devdutt Pattanaik, Ashwin Sanghi and Radhakrishnan Pillai reveal business secrets from our ancient texts By Ira Swasti Design by pradeep g nair
3 6 | INC. | march 2013
A
ncient Indian texts and epics are a treasure trove of wisdom on the way we live, how we approach work and life, and the influences that make us uniquely Indian. Sadly, these texts haven’t found much attention as an area of study in context of modern business—how have they moulded the way we run our companies, and manage our teams? Or, shaped our views on profit, branding and leadership? In this special feature story, we’ve attempted to bring together three best-selling authors—Devdutt Pattanaik, Radhakrishnan Pillai and Ashwin Sanghi—each of whom have unlocked the secrets of mythological and historical Indian gems such as the Ramayana, Mahabharata and Kautilya’s Arthashastra, and revealed them to be prized management handbooks relevant even today. In the course of this story, we’ve discovered fascinating insights into the innate traits and cultural inclinations that have defined business and entrepreneurs in India. Take what Ashwin Sanghi, author of The Krishna Key, and an entrepreneur himself, points out, for example. Sanghi says the concept of balance between Lakshmi and Saraswati, or money and wisdom, continues to be a cornerstone of management philosophy in India. It’s this balancing principle that has helped the country’s knowledge economy take-off, he says. Or, author Radhakrishnan Pillai’s insight on how the New York Stock Exchange has a bull on its entrance, and the Bombay Stock Exchange, Goddess Lakshmi. “For them, wealth is an animal. For us, it’s a Goddess.” Read on to find out other pearls of wisdom, identify the cultural roadblocks that stop Indian businesses, and learn from the leadership principles of great sages such as Ved Vyas, Valmiki and Chanakya.
march 2013 | INC. | 3 7
the chants of success
Mythology Mantras Devdutt Pattanaik
Renowned mythologist Devdutt Pattanaik believes that the western model of doing business may not serve well in India because it operates in a different context, socially, economically, politically and psychologically. The Indian way of business is highly individualistic, emotional and relationship-driven, he says. In his latest book, Business Sutra (soon to be launched), Pattanaik attempts to show how the “Indian” way of doing business—as apparent in Indian mythology, but no longer seen in practice—accommodates subjectivity and diversity, and offers an inclusive, more empathetic way of achieving success. Here, he reiterates how such an approach to business leads to greater success. 3 8 | INC. | march 2013
MURAL PAINTING by Shigil narayanan
the chants of success
Mantr a 1
The importance of relationships
I
n India, you cannot expect to get results in business without developing relationships. While an average American businessman would rely more on planning and processes, an average Indian businessman relies more on intuition and relationships. While the Western model can be shortsighted (look at environmental issues) and stripped of emotion (because of professionalism), the Indian model can be chaotic (lack of planning) and filled with irrational decisions (due to favouritism). The good thing is: the Western model creates a sense of order but demands compliance and alignment. Likewise, the Indian model gives a lot of creative freedom and an emotional springboard to employees in an organisation. The western model does not give great value to emotional and intellectual growth; what matters is economic growth and skills to enable that. The Indian model on the other hand, can create economic growth through emotional and intellectual growth, if the leader drives it.
Mantr a 2
Inclusiveness: welcoming but inefficient
B
eing inclusive of all people in an organisation can create a sense of belonging among employees, but it could also lead to inefficiency, if not managed properly. I believe inclusiveness is a result of the faith in the concept of rebirth in India. When you believe you live only once, your purpose in life is to do the right thing; there is no room for another way. The value of your life is the sum total of your achievements in this life. On the other hand, when you believe you live many lives then you know that the value of your life, no matter what you do, is zero because the denominator of your existence is zero. The point of life then becomes to
Dr Devdutt Pattanaik is an author, illustrator and speaker who has penned down 25 books on the relevance of mythology in leadership, entrepreneurship, branding and governance. He also runs two popular TV shows Business Sutra and Shastraarth on similar lines, and serves as the chief belief officer at the Future Group.
allow introspection and strive for understanding. It makes people more inclusive than exclusive. Subsequently, it makes organisations more diverse as they allow all kinds of beliefs to thrive, even those that discomfort them. But , this comes at a price: when everyone is included and all ways of functioning accepted, a workplace can end up being very inefficient.
Mantr a 3
Approach business as a ranga-bhoomi, not a rana-bhoomi
T
he word rana-bhoomi signifies a battlefield. In the contemporary business world, all organisations function like a battlefield; modern management is, in fact,
inspired by military strategies. So, we "compete" and "fight to win" and seek to "grab" market share. The whole approach to business is violent; the whole point is to win, stand on top of the list of market capitalisation, and grow at any cost to the satisfaction of the insatiable shareholder. Is that good? Does that mean we are still animals, or even worse—eternally hungry and paranoid, never content, and mocking those who sleep in the shade after eating their fill? Entrepreneurs should instead create their company into a ranga-bhoomi which means a playground where affection dominates the enterprise (notice how we chuckle at the idea—it's because we have bought in the myth of the ruthless enterprise and the dog-eat-dog world). Yet, there is a possibility to create an ecosystem where we grow by enabling others to grow emotionally and intellectually. This eventually leads to everybody growing materially. march 2013 | INC. | 3 9
the chants of success
Author and academic Dr Radhakrishnan Pillai believes the principles of Chanakya, one of India’s greatest leaders, can help train today’s entrepreneurs to manage people and businesses better. According to Pillai, Indians are born entrepreneurs who had traditionally been engaged in trade for centuries. But, the series of invasions India witnessed have brought in both a sense of mediocrity and a job-seeking culture. Yet, he says, even today most Indians would ideally like to start their own ventures. So, what makes Indians entrepreneurial? Dr Pillai ventures a few answers.
4 0 | INC. | march 2013
Chanakya Neeti dr Radhakrishnan Pillai
the chants of success
Neeti 2
Dr Radhakrishnan Pillai is the founder director of the Chanakya Institute of Public Leadership, a training school that aims to create a new breed of public leaders by teaching them management principles of India’s ancient leadership guru Chanakya. He has also authored Corporate Chanakya, a bestselling book that has been translated into 10 regional languages, made into an audio book and a training film.
The power of goodwill
I
ndian entrepreneurs believe a lot in goodwill, referrals and word of mouth publicity. If you look at Indian family-run businesses, expenditure on marketing and branding is very low as compared to the west. In fact, you’ll find several thousand crore businesses that don’t even have a website in our country. They just don’t feel the need to do business that way. A lot of business transactions here are carried out over simple, verbal commitments based on trust. If an Indian entrepreneur says she’ll deliver a business worth `1crore and she doesn’t, she loses her credibility in the market forever. Having said that, if an entrepreneur wants to build a global company, word of mouth marketing will only be the first step and she will have to use other forms of marketing to establish the business internationally. Neeti 3
Great leaders seek excellence
Neeti 1
The ability to adapt is essential for sustainability
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t is a well-known fact that the flexibility to change with the changing needs of the business and the environment is the secret to a long lasting business. And the good news is that Indians have a natural ability to do this. How else would Wipro have moved from being a dalda company to become an IT giant? Or Mahindra and Mahindra which was traditionally an automobile company diversified into fields like finance, software and tourism? If Indian companies were not adaptive to the changing times, they would have been washed away when the markets opened in 1991. But it’s not just important to adapt to environmental changes in business, but to
I people needs as well. For instance, in familyrun businesses in India, if the father or mother is running the business, the son or the daughter slowly changes the business to make it more professional, and adapts it to the next generation. I think the reason we are so good at this is because we have grown up with a lot of diversity in our living environment. India is a country that is hundreds of countries put together. We deal with numerous people from different states speaking different languages on a daily basis. Interacting with such diversity has taught us the power of adjustment and adaptability quite well.
f you look back at history, India used to be a land of prosperity and good governance. However, many centuries of foreign invasions have made us content with mediocrity. Think about it. In a nation of 1.2 billion people, there are only a handful of world-class, globally competitive businessmen. Moreover, most Indian companies are used to copying trends from the west. Why aren’t there enough trendsetters among us? Is it because we’ve always been taught to be content with what we have? We are happy being successful. We don’t aim for excellence, or to be world leaders. Indian entrepreneurs need to emerge from this mindset. They should seek to become leaders. As the saying goes—“You never win a silver medal, you always lose a gold medal." Indians need to learn to never accept the number two position and search for only the gold. march 2013 | INC. | 41
the chants of success
Karmic Verses Ashwin Sanghi
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Even though Ashwin Sanghi’s books are historical thrillers based on Indian epics, his entrepreneurial experience has helped him connect the dots between their ancient wisdom and modern day business practices. Sanghi believes that the notion of karma—that our past life’s actions have a bearing on our present life and our present actions impact our next life—makes Indian managers more resilient to setbacks in business. There is a feeling of this too shall pass that overtakes to deal with losses better. Conversely, this same notion could make them complacent and resigned to their “fate” or “destiny”. Here, Sanghi highlights three other spiritual beliefs that could shape the way entrepreneurs approach business in India.
4 2 | INC. | march 2013
the chants of success
Verse 1
Balance wisdom and wealth
T
he concept of a balance between Lakshmi and Saraswati—or money and wisdom—continues to be a cornerstone of Indian management philosophy. That same balance is apparent even in the Mahabharata—when Krishna asks Arjuna and Duryodhana to choose between him and his army before the war—in effect, a choice between strategic intelligence and material possessions. Essentially, he was offering his wisdom as a strategic thinker and a war strategist, or his army. This is probably one
of the most beautiful aspects of Indian management where knowledge and wealth creation are given equal importance. This is partly why we have a flourishing economy in times of a capital crunch right now. Unlike the west, this is not a conscious choice for us. The buzz now is a new concept of building the knowledge economy along with focusing on private equity and capital. But India has always known and practised this. I don’t think the IT sector boom would have happened if we hadn’t put a premium on knowledge. Nor would have India's knowledge economy taken off as it did. So we don't need to relearn that concept. We've always placed an equal premium on both. Verse 2
T
Look at the big picture
here was a lot of scepticism when Google adopted its informal corporate motto— don’t be evil. People said it was foolish. I don’t know whether Google is living up to its motto or not, but I have to say that there is a very philosophical and karmic context to it ; one that other corporates also must embrace. The notion of karma says there is a system of checks and balances, that there is life after death, and that every action has an opposite
It was inheritance that made Ashwin Sanghi an entrepreneur but passion that made him a fiction writer. Managing director of the MK Sanghi Group of Companies that has interests in real estate, automobile distribution, industrial gases and turnkey engineering projects, Sanghi has authored three bestsellers till date—The Rozabal Line, Chanakya’s Chant and The Krishna Key.
and equal reaction. If you believe in karma, it essentially means that there is a massive personal computer somewhere that is ensuring that every action in our life is recorded and the corresponding effect of that will be given to you in this life or the next. Most corporates tend to forget these checks and balances while doing business. They forget that their short-sighted actions today could have implications on their tomorrow. For instance, if an organisation uses natural resources in a way that is harmful to the environment, it may be good for the organisation’s balance sheet for now but eventually the company will have to deal with the environmental consequences along with the rest of the world. Somewhere I believe, this philosophy of don't be evil has been lost in the business world. Verse 3
Focus on the real
T
he 5 Vs of ancient wisdom—the Vedas, Valmiki, Vyasa, Vishnugupta and Vivekananda—have guided our inherent belief system. The notion that our bodies are not permanent, that we came with nothing and will leave with nothing, and that change is the only constant are ingrained in us. Yet these fundamental lessons have been lost in business somewhere along the way. We have forgotten the notion that everything is an illusion or the concept of maya. Very often, what you see in an organisation is not real. Figuring out what is real and what is illusory is as much of a challenge for corporates as it is for the sages and seers of our age. Several years ago, a finance professional said to me— any idiot can read the balance sheet but deciphering what is going on behind the balance sheet is where the true challenge lies. In that sense, the balance sheet is the Indian notion of maya, which tells you the profits last year, the ROI, the amount of tax paid but the real economics and politics behind the balance sheet is the "reality". If we were to understand this age old principle, our organisations will be much better managed. march 2013 | INC. | 4 3
HOW I DID IT
Tapping Opportunities Polsani Ravinder Rao Arunjyoti Enterprises
It isn’t surprising that P. Ravinder Rao found his entrepreneurial calling in an agriculture– related business. Growing up, Rao was enamoured by farmers. It’s a match that is clearly leading to great wins, both for him and Arunjyoti Enterprises, the Hyderabad-based company he acquired in 2008. Arunjyoti Enterprises owns and operates the Taaza brand of convenient stores, popular in south India. Over the past five years, Rao has led the company to great harvests of growth, including a CAGR of 1,231 per cent over the last three years. His next bumper yield—a `200-crore annual turnover, Rao claims. As told to sonal khetarpal / Photographs by A. Prabhakar Rao
Because I was born and brought up in Karimnagar, a small agricultural town in Andhra Pradesh, I have always been fascinated by farmers. Growing up with them, I saw how they toiled throughout the day in the fields. It’s from them that I first learnt about hard work, dedication and devotion to one’s work. Influenced that I was by agriculture, I decided
to take a combination of zoology, botany and chemistry as key subjects for my graduation from Osmania University, Andhra Pradesh. I graduated in 1996, and began working in Singareni Collieries Company taking care of their industrial relations. In 2000, I left my job so that I could start my own consultancy practice. I would essentially advice and help agriculturebased businesses. I also helped my brother in his agricultural marketing company, Manisha
4 4 | INC. | march 2013
Agri Biotech. It was during this time that I got in close contact with Pabbathi Subramanian, a family friend. He was a visionary man, and I learnt a lot from him. He became a tremendous pillar of support. He saw the potential in me and motivated me to move beyond consultancy, and start my own business. My elder brother was also extremely encouraging. Luckily, at that time, our CA came to us with the
offer to buy the Kolkata-based Arunjyoti Enterprises. It was being offered for sale at a very reasonable cost. Plus, buying an existing company seemed a smarter idea to me than to start from a completely empty slate. Incorporating a new company is a challenging, time-consuming process. Buoyed by everyone’s faith in my abilities, I bought the company in 2008 with my own personal savings and a loan from my family.
Growing Presence
Ravinder Rao wants to break in to the unorganised retail market of vegetable sellers and local kirana stores, and add 1,000 more Taaza neighbourhood outlets in the next six years.
HOW I DID IT
Arunjyoti was a finance company dealing
in investments but I was keen on following in my brother and my mentor’s footsteps. I too wanted to start trading in agri-based products. More specifically, I was extremely interested in the supply chain of agri-based products, i.e. sourcing products directly from farmers and providing it to the end user for consumption. So, we started buying agricultural products like bio-pesticides, bio-fertilisers, agri-based chemicals and farming equipment from manufacturing companies and supplying them to farmers. This decision served us well, and in the first year itself we reaped a turnover of `40 crore.
The same year, we also set up our first organised retail outlet under the brand name Taaza, in Hyderabad. We wanted to break in to the unorganised retail segment of vegetable sellers and the local kirana stores and capture that market by establishing Taaza as a leading neighbourhood retail store for fruits, vegetables, grocery and FMCG products where customers can buy good quality products and get value for money. However, we could not grow our retail segment as planned. Due to the unfavourable image of the retail industry in 2008, the banks refused to give us any loan for expansion. We had to set up retail outlets from the internal accruals of the company and an additional personal investment of `2 crore. That slowed the pace of our retail business. To boost the overall growth of the company, we concentrated on the trading vertical of our business. We worked on expanding our distribution network considerably and in the second year, we grew our business to `70 crore. As we were growing, we ensured our plans
for growth of our business were clearly delineated. For the retail segment, we had come up with a kirana model—opening up convenience stores in the interiors of residential complexes to cater to the household needs of that neighbourhood. The key advantage of such a strategy is the low rent in residential areas as compared to com-
4 6 | INC. | march 2013
The Diversifying Game Merely growing Taaza is not enough for Ravinder Rao. He is intent on adding more segments to Arunjyoti’s trading platter.
mercial complexes. This considerably reduces our overhead operating expenses for stores making our business model sustainable in the long run. Also, we wanted to expand the range of
products and services offered at our stores. In order to do so, we introduced our own branded range of FMCG products last year. We also began providing value-added services like bill payment (electricity, water, household tax bills) services, mobile recharge, buying of air, train and bus tickets and even tour packages. To retain our customer base, we formed a loyalty programme where each customer gets extra points when shopping with the Taaza Gateway Card, and can avail periodical offers and price discounts.
Even though we did not add any major retail outlets in the last few years, we have got a great response from our current five outlets. Due to the small number of stores, we do not have the economies of scale advantage as yet. However, to grow our customer base and brand recognition, we have
started marketing the Taaza brand through door-to-door marketing. We have realised it is the best way to establish brand presence and build personal relations with the people in the store’s vicinity. It helps us to understand their requirements and address the existing problems regarding the availability of merchandise and its quality. We also advertise extensively through pamphlets in newspapers. Going forward, we intend to open one out-
let for every 2,000 households in Hyderabad and Secunderabad in the next two years. We are specifically looking at opening captive stores in high-rise buildings where there are a cluster of 600-800 households. This is to meet our larger plan to open 1,000 outlets all over India in the next six years. Once we have a considerable number of outlets, we will be providing Taaza vans which will deliver FMCG items including fruits and vegetables at the consumer’s doorstep. We are looking at these evolving models and working very hard for a substantial growth in the retail segment in the next year.
the path to optimisation
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HOW I DID IT
For now, we want to concentrate on
opening company-owned retail stores only. Next year onwards, we will consider the franchise model for opening our branches. Once our brand presence is established at one particular location, it will then help us to get a better value for our franchise stores. We are also planning to leverage on corporate farming. We intend to provide the owners of big plots of land all the infrastructure and necessary products for farming and then divide the profit on the produce with them on a profit sharing basis.
Apart from growing our current verticals, we are also adding more segments in Arunjyoti. Our main consideration is to add value to all the stakeholders. But,
“Door-to door marketing is the best way to establish brand presence and build personal relations with customers.” things on that end haven’t always gone according to script. For example, last year, we started dealing in computers and peripherals. But, we hadn’t estimated the market response correctly. We couldn’t sell fast enough. As a result, our inventory started stacking up. It locked up our capital. In any case, this was a very low profit margin game. Our foray into computers led to considerable losses, and we eventually discontinued our operations. It was a tough time.
In contrast, the newly added division in trading—building materials (mostly cement and steel)—is doing very well. In a span of one year, we already have orders worth `200 crore from various infrastructure companies to supply cement and steel to them. By end of this fiscal, we are expecting a turnover of around `150 crore just from this venture. With the new verticals and the many new plans for development, the next two years look exciting and we are looking forward to crossing many milestones.
Tactics. Trends. Best Practices.
strategy
Social Media Champs Krya founders created tremendous buzz around their products using a blog and a Facebook page.
Photographs courtesy subject
Marketing Pre-sales soaped up! How a detergent company readied customers before launch
“Having worked in international FMCG firms for eight years, we knew how many harmful products went into everyday products.”
Introducing a new product in an existing product category is an exercise in giving answers, especially to that one question that comes up each time a potential customer is approached— why should I buy the product? Krya Consumer Products, a Chennai-based manufacturer of natural, eco-friendly detergents founded by husband-wife duo Preethi Sukumaran and Srinivas Krishnaswamy, didn’t want to get boxed in by the questions when they went out to sell their new reetha-based cleanser. So, before the company launched its product in May 2011, they created a blog and a Facebook page to answer the persistent questions they knew would undoubtedly come up. Having worked as brand managers in international FMCG companies before turning entrepreneurs with Krya, Sukumaran and Krishnaswamy had strong instincts about how to approach a market. Although they were confident an environmentally sustainable option for a household detergent had a good market in urban centres, they realised that since it was a new concept, they needed to prepare their potential customers beforehand. So, in December 2010, when the duo was still working on sourcing raw materials and logistics to kickstart their manufacturing, they started a blog and a Facebook page to create awareness about the different ways of sustainable city living. Instead of march 2013 | INC. | 51
strategy
the product itself, a majority of the print space on their blog was dedicated to other ways of living a sustainable life in a city. For instance, they wrote on a variety of issues such as composting at home, creating eco-friendly business cards, using green alternatives for mosquito repellants, and fabricating baby sustainable diapers. For them, it was important to clearly define what they stood for as a brand which was the bigger goal of their venture—sustainable living. “The idea was to define the problem first, and then to introduce the solution. With the blog and the Facebook page, we had set the context for bringing out a new detergent in the market and to give people a reason to buy it,” explains Krishnaswamy. Of course, the blog also gave them a great opportunity to drum up excitement for the product. The two posted regular sneak peeks into the product’s progress. For example, they took the blog’s readers through the journey of how the packaging evolved, from the reusable and recyclable cardboard material used to package the product to sourcing the raw material of the detergent from organic polyculture farms in Andhra Pradesh. Even as this approach gave them a chance to talk about how the company lived out its mission in every small way, Krishnaswamy says it also helped educate and inform environment-conscious customers. “Adding value to the user, through not just the product, but creating awareness about other ways of sustainable living is more important to a consumer than internal company milestones,” he says. Most companies get this wrong by putting company-specific news and events on their marketing collaterals which really holds little meaning to an outsider. When the product was finally launched in May 2011, the duo already had a customer base ready to sell to. They say their blog averaged 7,000 page views per month last year. That combined with their not-so-big but deeply engaged community shored up sales numbers. In fact, just within a year, the average sales of their eco-friendly detergent had reached one lakh units a month. Expecting to see interest from only passionate environment-conscious individuals, the two were surprised to receive orders from people of all age-groups, genders and regions alike. “Now that everyone has an internet connection, we saw people from very remote areas such as Peechi, Dungarpur, Sangareddy and Uppinangady ordering the detergent from us. In fact, in some cases, courier services didn’t cater to these places and we had to send it by post,” says the IIM Bangalore graduate. While the duo confess it’s difficult to say what would have happened if they had launched the product before creating an online community, Krishnaswamy is certain it would have taken much longer for people to understand and appreciate the point they were making and show the same enthusiasm to buy the product as they did now.
Sustainable Living Sukumaran and Krishnaswamy used social media to create awareness about the bigger goal of their venture—sustainable living in an urban city.
“Add value to the user through your company blog instead of posting corporate milestones.”
5 2 | INC. | march 2013
Since the launch, the company’s online social activity has only increased as the team sends their products to other bloggers for reviewing and regularly contribute to other blogs and magazines that talk about sustainable living. But building an online community has had another tangible business advantage. It has helped the founders understand their customers’ needs and interests much better without incurring a lot of costs—including discussions such as how to optimise detergent use, judiciously using washing machines, or treating hard water to wash clothes. Several of these discussion threads were actually initiated by readers themselves, Krya claims. Obviously, an online community as engaged as this has also provided a great feedback platform when it comes to product development. It’s certainly reduced Sukumaran and Krishnaswamy’s need to travel extensively, and helped them gain insights from across India. Only half in jest, Krishnaswamy admits their community also does a great job of motivating and pushing them. In fact, the latest question doing the rounds in the company’s community is—what next? What else does Krya have in store for its loyal followers? Lots, if the founders
strategy
are to be believed. Their next batch of eco-friendly products includes shampoos, face washes and moisturisers. A Lather Journey Sukumaran and Krishnaswamy had worked for eight years in Marico and Johnson & Johnson before quitting their jobs to start the venture in 2010, and in the process, they had seen the amount of harmful chemicals that went into making daily consumer products. “So for the past several years, we’d been experimenting with creating ecofriendly products such as shampoos, floor cleaners, dishwashing soaps and detergents for everyday use in our own house,” says Krishnaswamy, who prefers to take a bus instead of the car to go to work everyday. And they had been pretty successful too. By the end of 2009, they had developed workable products for their home by using a completely natural cleansing agent—soapberries, better known as reetha, and made their families switch to these eco-friendly products too. The biggest innovation of their product however, did not lie in their using reetha (as reetha has been used for washing and cleaning in India, China and other parts of Asia for centuries) as it did
in developing an old cleaner that could be used in different modern day settings where consumers expect after sales services and use washing machines and hard water to wash cloth. And detergents were their clear choice of product to spearhead the environmental crusade. Not without ample reason either—detergents are used by everybody. They have been red flagged by the Environment Ministry to have caused extreme levels of air and water pollution. And they are a product that consumers don’t really put much thought into while buying as they would for personal care products such as shampoos or face washes. But it wasn’t until after a backpacking trip around the world for a year, that the duo realised that if the products had worked so well for them, they could help others too. “When you move from being an employee to an entrepreneur, you have to unlearn some lessons and learn fresh ones. We had been working in a large comfortable well-oiled machinery setup where everything was available through a single mail or phone call, with big budgets to work with,” Krishnaswamy says. “But as an entrepreneur, you need to learn to work efficiently on your own, on a startup budget and travelling was a great way to do that.” —Ira Swasti
xt Gen uting
other food groups I mentioned in my previous answer, is outstripped by the capabiliADVERTORIAL ask the expert ties of the mainstream processor family, which in today’s incarnation is Intel’s Xeon E5 2600 series. In response to this phenomenon, Intel subdivided the Xeon lineup to include a new “EN” class of processors, the E5-2400 series, which ease back on the gas pedal of Moore’s law for designs that don’t require as much processing power in relation to local storage and memory. This creates a new class of cost & performance optimized systems for lighter workloads or for storage heavy systems (think big data) at the entry end of the portfolio. various permutations of server designs Three of our new UCS M3 series systems required to cover the myriad of workloads fall in this category: the B22, C22 and C24. most efficiently. Think of these as your four At the same time, Intel has brought four server subsystem food groups. Architecsocket server options, formerly the provture purists will remind us that everything ince of the mission critical, “EX” end of the outside the processors and their cache spectrum, down into the mainstream. An falls into the category of “I/O” but let’s not example of this is our new UCS B420 blade. get pedantic because thatiswill mess up my SoA:ifThere you are want four socket count and Q: Centre for Sight India’s second-largest many resilient andcore robust applications ophthalmology that are available a cloud model including ERP, food group analogy. chain with 44 centers across the performance butondon’t necessarily need the country. We expect a turnover of more than `125 crore DW/BI and Disaster Recovery (DR). Disaster Recovery In Cisco UCS,The I/Ocompany is effectively taken leveraged comprehensive features of an EX class this fiscal. has successfully organisations can RAS also look to deploying a public private cloud to achieve real-time multi-location, multi- cloud, because they will not have to invest in trained off thebusiness table asintegration. a designWeworry because you have a price/performance are now looking up to our IT system, manpower. Asnow the DR datacenter can be owned by team to gets furtherits strengthen this initiative service providers to runfor these services, every server full USRDA of net-and make optimized solution that need. there will be Centre for Sight a more resilient organisation. What no investment on the setting up of the DR datacenter. working through VIC: helping porsolutions can Ithe expect from my IT team when it comes For the rest of the applications, the existing environment For any queries regarding UCS, please send to business intelligence, asset management and new- needs to be examined. If the current running tions of bandwidth, rich with Fabric them to yashvendra.singh@9dot9.in age disaster management? applications have additional modules available, which are well tested and integrated for BI, CRM, SCM etc., Extender technology vitamins that yield they would enable easy integration. Many other hundreds of Ethernet and FC adaptstandard applications are also available that can help BROUGHT TO YOU BY get the datacenter upto speed on these aspects. ers through one physical device. Gone are the days of hemming and hawing over how many mezz card slots your Ashish Wattal blade has or how many cards you’re going National Product Manager– UCS to need to feed that hungry stack of VM’s on Cisco India & SAARC your rack server. Intel, the Intel logo, Xeon, and Xeon inside are trademarks of Intel Corporation in the U.S. and/or other countries This simplification changes things for the
e articles, Cisco will shed d Computing System g CIOs to better manage
Dr Mahipal Sachdev Founder, Centre for Sight
“I don’t have a title on my card. If people ask, I’m the Chief Troublemaker.” The Way I Work | Hitendra Chaturvedi, RLC
Much like he enjoys revving up his Harley Davidson, Hitendra Chaturvedi enjoys accelerating the growth of Reverse Logistics Company (RLC), a company selling seconds products through their brand Green Dust. Running a business seemed an unlikely pit stop for somebody like Chaturvedi, who has worked at corporate giants such as Microsoft and Ernst & Young. Yet, it was Chaturvedi’s three year stint at the Texas-based reverse logistics company, Newgistics that changed the course of his career and led him to found RLC in 2008. Today, he’s happy with just five hours of sleep, and is using best practices from his previous companies to outfit RLC’s culture. A passionate and certified pilot and painter, Chaturvedi is now most focused on his new goal—of evolving from a manager to a leader. As told to Sonal Khetarpal | Photographs by Subhojit paul 5 6 | INC. | march 2013
strategy
The Seeker The Harley-Davidson enthusiast who takes his ride to work says entrepreneurship taught him 90 times more than his 17-year corporate stint.
My day actually never ends. With e-mails synced to my phone, I can work anywhere at any hour. My car, my home is my office. Yet, I wouldn’t say I am a workaholic. Running your own company is like being on a vacation; you just never get tired. So, I sleep around 2am and wake up by 6.30am. After doing puja and downing my usual breakfast of cereal and fruits, I leave for office. I ride my Harley-Davidson to work, and by 7.30am I am in office. For the first half an hour at work, I don’t switch on my computer. I use the solitude to collect my thoughts, and make a note of whatever comes to my mind in my diary. By 9am, I have already replied to all my mails, made presentations, seen various reports from the day before and given feedback. march 2013 | INC. | 5 7
strategy
My company is not a congregation of yes men. I like people to challenge me. Beyond 9am, I don’t have a typical working day. I am on the road a lot. I travel 20 days a month to meet clients, investors or to visit our different offices. Wherever I am, I spend 60-70 per cent of my time managing the 500 people we have in our 15 offices in India. That people are the greatest asset of an organisation is a gyaan that a lot of successful entrepreneurs talk about. To be honest, I used to be very cynical about such corny statements. But, over the last five years, I’ve learnt that it’s actually very true. When you are running a company, you can predict most variables such as demand, supply, market reaction, but you can never really know how people react to different situations. A company is much like the popular television show Big Boss. People from different backgrounds and distinct personalities are brought together. The CEO or the founder is much like the Big Boss voice in the background which gives them tasks, guides them and resolves their frictions. To make everyone work together and be joint to a purpose, I ensure each of my employee understands why Green Dust exists. There are two main reasons that excite me—one is that we are contributing to being green and sustainable. India has a return rate of 4 per cent, that is, products worth $14 billion get returned every year and they sit idle at the original equipment manufacturers’ (OEM) warehouse. RLC takes those defective, returned or unsold products from OEMs, repairs them, provides a year’s warranty, and sells those factory seconds at a lesser price, thereby saving them from going to the scrap heap. By making them usable, we are helping the environment. That, to me, is a cause worth battling for. What also motivates me is making aspirations come within the reach of the aam aadmi who is always stretching his rupee and might not buy a product at its market price, but can afford it at 25 per cent less. These are essentially the two reasons why RLC exists and I am trying to incorporate this in each employee. I have also got posters with the company’s vision, mission and values pasted all over our offices. Beyond company vision, a good manager must understand what drives each person. 5 8 | INC. | march 2013
For some it is money, for others it can be recognition, competition or job security. Aligning their motivation with the company’s goals ensures everyone grows together with the company. This has to start right from the time of hiring them. I personally interview each and every employee of this company to be doubly sure that we hire the right people. I prefer to get those people on board who complement my skill set. Getting people exactly like you is the worst mistake an entrepreneur can make. It’s important for entrepreneurs to know what they don’t know and I hire the best from that domain. I do not want my company to be a congregation of yes men, people who nod their heads at everything I say. I want them to challenge me in the board room. I admire people who create their own identity, rather than follow others. I constantly engage with my staff and encourage them to communicate their ideas on projects and work processes. I do not sit in the ivory tower and give directions. I ensure I know exactly what is happening on the ground. If I don’t know something, someone will take advantage of that and it might lead to more office politics. I am totally against that. Often, I do surprise visits to our different offices to find out the real story. eing a good manager is mostly about listening. In fact, listening is my most effective work habit. Of course, the challenge is in listening to everyone, and yet to be neutral. I try not to get swayed by anyone’s personal opinion or prejudice against a colleague. But it gets difficult at times. It is then that I remind myself that it is not only an employee but also his or her family that is fed with the cheques I sign. I cannot let them get affected by making rash decisions because of an individual grudge. To be truly objective, especially when it comes to personnel decisions, I always stick to the facts. From the first day we began the company, we introduced an IT-based performance manage-
strategy
ment system. Every quarter, each employee self-assesses and is assessed by his or her reporting manager on the basis of certain key performance indicators. I normalise all the reports in a bell curve on the basis of top-10 per cent, mid-80 per cent and last-10 per cent employees. The top 10 per cent get all the promotions, raises and incentives. That way, all employees know their position in the company and can plan their career, accordingly. This allows for complete transparency and clarity in the appraisal process. I’ve picked this approach from my stints at Microsoft and AT Kearney. They had structured their performance appraisal just like this. I’ve been fortunate to work in some good companies. So, I am always trying to bring in the best practices from my previous work places into my company’s culture. I want RLC to be one of the best places to work in. It’s my aim that people should enjoy their work. For that, a light-hearted, healthy atmosphere is essential. I am proud our attrition rate is less than three per cent. Making people feel acknowledged is hugely necessary. I make it an effort to talk to my employees on a personal level, even if it is one sentence about the well being of their family, so that they know I notice and care. On people’s birthdays, marriage anniversaries or other special occasions, an e-mail is blasted out to the whole company. I message each of them personally. When we have office parties, festivals or other events, we plaster the whole office with photos from the event. I got this idea from Southwest Airlines in Dallas, USA when I did a management consulting project for them. I have realised that celebrations, experiences and emotions is what we ultimately remember. Milestones just keep on shifting forward but it’s only when you start enjoying these moments of happiness that the destination becomes really worth it. I remember how I would travel in an auto and live in budget hotels in the initial years of starting the company. Working for big names like Ernst & Young, AT Kearney and Microsoft, I was used to chauffeur-driven cars and five-star hotels. However, as a founder of a growing company, I gave it up. It was a different kind of life altogether. The first five years of heading RLC has taught me 90 times more than my 17 years of work experience put together. I have also realised that when you are working for such established companies as Microsoft, you tend to become big-headed. It is because you are always acknowledged and treated well. What I didn’t realise then was that it was not me or my designation that appealed to people, it was the Microsoft brand. When I started RLC, I realised people don’t care about me as much. I decided that at RLC, I wanted my senior management team to be as grounded. So, every manager, whether it is the VP or the CFO, spends half a day every month at our call centre taking customer calls. It is important that they know what our customers are taking about and what is actually happening on the ground. In Amazon, every Christmas, the entire man-
Standing Out Not having a brand like Microsoft or Ernst & Young to back you can be humbling, Chaturvedi says. To make sure his senior managers are grounded as the company grows, all of them spend half a day every month staffing the call centre.
agement team, including the founder, Jeff Bezos is in the warehouses packing boxes to ship to customers. Such practices help to keep the organisational structure flat. I also do not have my designation printed on my business card. When people ask me, I just say, “I’m the Chief Troublemaker”. In spite of these efforts, the general mindset in India tends to lean towards a lot of hierarchy. As a founder, everyone expects me to have answers for all their questions. Sometimes, it does get lonely battling people’s expectations, and the company’s challenges. I do wish I had a sounding board to discuss my dilemmas. In fact, I believe it’s probably wise to have a co-founder. To beat the stress, I work out at the gym daily, seven days a week. My everyday routine of morning puja and exercise in the evening help me face the problems. I also get inspiration from the books I read. I particularly find this quote from Mark Twain very stimulating, “Twenty years from now you will be more disappointed by the things that you didn’t do than by the ones you did do. So, throw off the bowlines. Sail away from the safe harbor. Catch the trade winds in your sails. Explore. Dream. Discover.” But, the real motivation, I think, I draw from my own personality. I am my own worst critic. I am never satisfied with what I do and that pushes me to do better and better. march 2013 | INC. | 5 9
I wish I knew then...
C.V. Subramanyam, chairman & MD, Cigniti Technologies After successfully leading Balaji Transport, a leading transportation and logistics company, C. V. Subramanyam made a surprising foray into the information technology business when he founded Cigniti Technologies in 1998. But, success eluded him for the first 10 years. It was only when his son, Srikanth Chakkilam returned from the US that the tide turned. Soon, the father-son duo transformed Cigniti into India’s largest independent software testing services company. Today, it has a revenue of more than `140 crore and over 500 employees. Yet, Subramanyam says wise entrepreneurs know that keeping their focus on one core area is the key to business success. In 1998, I was already a successful businessman when a friend introduced me to a American company that wanted a local partner to establish a joint venture in IT services. I knew nothing about technology but thanks to my partner Bill Taylor, the business grew well for the first few years. When he chose to retire in 2001, I decided to continue on my own, and expanded the business into software services and software products. But, that was a costly mistake. We were spreading ourselves too thin by trying to do everything. Also, because of my lack of knowledge, I relied too much on one person whom I had elevated to be the CEO. Without my knowledge, he centralised all decision making. It wasn’t a healthy atmosphere, and we struggled to grow for six years. To make matters worse, in 2008, when the CEO resigned, he also took away some clients with him. I was nearly at the verge of selling off. For advice, I turned to my mentor Mr Raghupathy, the executive president of India Cements. He told me to do three things—have a big vision and believe in it, focus on one area within IT, and build a strong professional team instead of relying on just one person. Encouraged, I plunged
6 0 | INC. | march
2013
The Focusing Act C V Subramanyam knows his costliest mistake was spreading himself too thin.
into rebuilding the company. Fortunately, my son Srikanth Chakkilam also returned to India around the same time after completing his masters in Computers and MBA from the US. Since he understood the technology business, he identified software testing as our focus area. Together, we set an audacious goal to become one of India’s largest independent software testing services company in three years. At that point, we were only a `5 crore company and we were aiming to grow 25 times in
three years. Many people laughed at me and said given my track record in IT, it was impossible. We repositioned our company as an independent software testing services firm and put together a professional top management team. Luckily, we managed to bring in many new clients. We also became a Microsoft Gold partner in 2008. Through a friend in the US, we got a multi-million dollar project for custom software development. The order was more than twice our revenue. Yet, I decided we will not take the order. I did not want to repeat my mistake of going after too many things. I spent many sleepless nights wondering if I had done the right thing. Eventually, with a continued focus we started getting more orders and by 2012 we emerged as India’s largest independent software testing company. Now, we’ve set a new goal of becoming the world’s largest independent software testing services company in the next three years. No one laughed this time. Our perseverance had paid off, and our performance was a fitting answer to all the naysayers who had advised me to sell the company. —As told to Sonal Khetarpal