Top 3 or out

In an interview in Economic Times (7/3/2008), Aditya Birla stated his criteria for being involved in an industry. He said that he will only participate in an industry only if they have 1,2 or 3 position otherwise they will quit. Well this is nothing new. Actually, its a criteria borrowed from Ex GE’s chairman (I am forgetting his name. Sure sign that I am getting old) who built GE based on the same criteria. However, I do not think this makes sense.

Corporate Social Responsibility – Where should it start?

I have been hearing a lot about Corporate Social Responsibility (CSR), that is, a company’s responsibility towards the society. In simple terms it means that a company must manage its role in society as a producer, employer, customer and citizen. I think most of the discussion on the subject centers around a corporations involvement in supporting social causes. Every corporation adopts some social causes and thinks that this is the best way of implementing CSR.

World Class

I don’t know about you but I am sick and tired to hearing people say we are building “world class” this or the other and that we will take over the world shortly. If you have heard about the sorry state of affair at the Gurgaon Tollway, then you can understand why I have started hating the words “world class.” How can we lead the world if we can’t organize a simple toll operation. And its not that we have discovered or invented something new. All we have to do is to just copy what others are successfully doing all over the world. I grew up listening to the Ludhiana joke which implied that we can copy anything but it seems that we are even lousy at that.

Keeping track of Biyani

It seems to me that Kishore Biyani announces the plan to start a new retail format everyday. The questions that come to my mind are as follows:

Flanking with Tata’s Nano

There is no one who has siad so far that they will be seriously affected by Tata’s Nano. I think this is the best sign that Nano will succeed as no one considers it a serious competition. What Nano is going to do is flank a number of product categories. It is going to nibble away small market share from a number of products and no one would be any wiser. By the way, the reason for the success of Nirma was that it flanked Surf. Surf didn’t feel that Nirma was a worthy competitor till it was too late. Lets see who all will Nano flank?

Reliance – IPO

Even though, I had finance as one of my specialization in MBA, I have been a little confused with the how heavily the Realinace Power IPO has been oversubscribed. I do nor remember exact numbers but I remember the IPO was at around Rs. 450 and the market was expecting it to be listed at Rs. 900-1000. Hence the frenzy to take part in the IPO by everybody. This suggests that either the company is stupid to sell its shares at Rs. 500 or the market is stupid to buy it at Rs. 1000 on listing. One can think of a 5-10% variation but almost 100% variation is beyond my understanding.

Why are we so obsessed with targets?

I think we should do away with targets. Hey, don’t shoot me. Listen to my complete story.

Its about finding a gap in the market, stupid!

On 21/10/2007, I had posted “80/20 rule of marketing success – find a gap” in which I had mentioned that MEOW the radio station has found a great gap and staked its claim to this space and that according to me it will be a great success. The reason my dear is very simple. They have found a gap and positioned themselves as a radio station for women.

Why are we so obsessed with volume/scale?

Anand Mahindra, vice Chairman, Mahindra & Mahindra Ltd. said in an interview, “…. The argument most people use against niche is scale.” Why are most people obsessed with scale? It follows that these people think that price is the only factor that matters and you can only bring down costs by increasing volume to achieve economies of scale. Everybody seems to working towards increasing scale. They seem to be saying that niche players cannot exist.

Do we walk our talk?

Recently, Prime Minister manmohan Singh said that “the economic reforms of 1991 unleashed a new era of entrepreneurial growth in India.” The subtitle of Mint’s article “India’s entrepreneurs have helped make the country what it is today” says it all. The article also suggests that the contribution of India’s entrepreneur has been ignored in making the country what it is today. The article also draws a parallel with the American economy and quotes a survey which found that during the period 1980 to 2001, firms less than 5 years old contributed to the net growth in employment whereas established firms lost jobs.