January 2016

Why every aspect of business is about to change ? ~ Article from Fortune

Investment Planning, Identifying multibaggers, Stocks , INvesting for 2016 Ideas

What better way to start new year than analyzing the past ? A Brilliant Summary of changes that is going to hit us one way or other sourced from www.fortune.com

Why every aspect of your business is about to change

Geoff Colvin

Imagine an economy without friction-a new world in which labor, information, and money move easily, cheaply, and almost instantly. Psst-it’s here. Is your company ready?

Cars bursting into flames are never a good thing. So when a Tesla Model S ran over a metal object in Kent, Wash., in October 2013 and burst into flames, owners, potential customers, investors, and company executives got worried. When the same thing happened a few weeks later in Smyrna, Tenn., federal regulators opened an investigation. We all know what happens next: a massive recall, costly repairs at dealerships nationwide, and a painful financial hit to the carmaker. Yet none of that occurred. The problem was that the Model S could lower its chassis at highway speed to be more aerodynamic, and if debris hit the car’s battery pack in just the wrong way, it could catch fire. So Tesla  beamed a software update to the affected cars, raising ground clearance at highway speed by one inch. The problem went away. Just four months after opening their investigation, the regulators closed it.

Using software and the mobile-phone network, Tesla avoided any need for a recall. It doesn’t have any dealerships; customers can configure and order a car online, and they can test-drive cars at company-owned showrooms. Tesla’s advanced electric technology is simpler than gas or diesel technology, so cars can be built with fewer employees and less capital. Combine those factors and here’s what happens: General Motors  creates about $1.85 of market value per dollar of physical assets, while Tesla creates about $11. GM creates $240,000 of market value per employee, while Tesla creates $2.9 million. You don’t get differences like that just by being more efficient. Tesla, though in the same business as GM, is a fundamentally different idea

 

GM is changing, but for now it’s still a 20th-century corporation. Tesla is a 21st-century corporation, built for sweeping new realities that change the rules of success. The big theme is the arrival of the long-heralded friction-free economy, a new world in which labor, information, and money move easily, cheaply, and almost instantly. Companies are forming starkly new, more fluid relationships with customers, workers, and owners; are rethinking the role of capital (as traditionally defined), finding they can thrive while owning less and less of it; are creating value in new ways as they reinvent R&D and marketing; and are measuring their performance by new metrics because traditional gauges no longer capture what counts. (more…)

July 2012

The Managerial ~ Leadership Grid ~ What type of manager/leader are you?

Peter Drucker Quotes, Pictures, Inspirational, Leadership, Management, MBA QuotesThe style of management in changing situations is influenced by various factors like organization’s culture, value system, personal history of the manager or chance or opportunity.

The style of the manager, nevertheless, impacts the performance of various stakeholders associated with the organization including the manager himself. 

What management style do you belong to?  Are you driven by results, Are you autocratic or a people man, driven by relationships.. 

The leadership ~ management grid (Source Blake RR & McCanse, A. A, 1991 ~ Leadership Dilemmas ~ Grid Solutions) classifies the leadership styles into 5 distinct types.

(1) Impoverished Management ~ Very little concern for productivity or people
(2) Country Club Management ~ Very great concern for people but very little for productivity
(3) Authority – Compliance Management ~ Great concern for productivity & very less concern for people
(4) Middle of the Road Management ~ Compromising ~ Medium concern for both productivity and people
(5)  Team Management ~ High concern for both people and productivity ~ Considered to be the Ideal Style

Management, Leadership Grid, MBA, Successful manager, Team Management, Leadership Styles,

What category do you fit in? It’s Worth a look……

 

What is Investment Banking~And why is it HOT…..

Investment Banking,Mergers and Acquisition, Raise Capital, Issues, IPO, Venture Capital , Private Equity,

The other day, a doctor was asking me about investment banking and why is it so hot. He was rather perplexed about the sky-high digit salary figures doled out to MBA’s by top notch financial MNC’s. And so..I thought of penning down my thoughts and discussion with him for the benefit of those who would like to know the reasons for the lucrative remuneration of the blue-eyed I-Bankers..

Investment Banking are involved primarily in 2 main businesses : a) Mergers and Acquisitions and b) Merchant Banking

The MnA team advises companies on various aspects when the companies decide to expand and buy another company. The various aspects involved are strategic analysis of the deal, Screening, Due Diligence, Valuation, Structuring of the deal, Negotiation, various approvals, regulatory compliance etc. In essence the MnA team facilitates the process by bringing in expertise. The I-Bank earns a fee which is typically a percentage of the deal. So for eg: In the I-Gate – Patni deal which was about $1Billion, a percentage of the deal amount goes to the I-Bank…

Now here is the sweet part. Typically the team size is small and the bonuses earned are spread in this small team which makes the profile of an I-Banker extremely lucrative and ‘Hot’ ~ Since the team size is small, the hiring is small and hence getting into this profile is low.

The other area is Merchant Banking, which involves raising capital for the businesses. The Banker’s job is to figure out the best way to raise money, keeping into consideration market conditions, duration of requirement, urgency etc. For Eg: IPO or Initial Public Offering is a type of Issue Management which an I Banker would get involved

I Bankers are one of the most sought after professionals and their rewards multiply once they develop a reputation in the circle for their expertise ~ which makes them a HOT property.

 

The ten commandments of Customer Service ~ Carl Sewell

customer service,book, customers for life, brand, carl sewell, retail management,marketing profit, business, companies, management, leadership, MBA stuff,
I am in between reading this book ” Customers of Life” and am loving every bit of it. It’s awesome….
 
It starts with the ten commandments of customer service, delighting customers and keeping customers of life : 
 
1. Give the customers what they want, again and again..
2. Under promise and Over deliver
3. If the customers asks for something, the answer is yes
4. A job has to be done right, every time.. Keep systems and smiles alone are not enough.
5. Every employee is your customer service employee… This is similar philosophy of Zappos.com
6. Encourage customers to give complaints… No complaints means something is wrong. 
7. Measure..Measure..Measure.. What cannot be measured.. cannot be done and what cannot be done cannot be achieved.
8. Treat employees as partners…Pay accordingly
9. Be polite.. Show respect.. It works
10. Continually improve systems and make them the best..
 
Of course all these work when you are in profit 🙂

Peter Drucker Leadership & Management Quotes~ Pictures

Peter Drucker ,Leadership , Management Quotes, Pictures, MBA Quotes, Success Quotes, Financial Management

Peter Drucker ~ Success Advices
– The purpose of business is to create a customer.
– Efficiency is doing things right; effectiveness is going the right things.
– A manager is responsible for the application and performance of knowledge.
– Knowledge has tobe improved, challenged, and increased constantly, or it vanishes.
– The most important thing in communication is hearing what isn’t said.
– Follow effective action with quiet reflection. From the quiet reflection will come even more effective action.

~ Leadership Quotes~

June 2012

PEST Strategic Analysis Framework

strategy, plan of action, PEST Analysis, SWOT Analysis, Frameworks, Management, Leadership, Competition, Competitive AdvantageIf you know the enemy and know yourself,
you need not fear the result of a hundred battles.
If you know yourself but not the enemy,
for every victory gained you will also suffer a defeat.
If you know neither the enemy nor yourself, 
you will succumb in every battle 
 ~ Sun Tzu, The Art of War, Special Edition

pest analysis, strategy, management, swot, framework, business, competition, competitive advantage, organization,

PEST analysis is a strategic business measurement tool.

PEST is an acronym for Political, Economic, Social and Technological factors.

These factors are primarily external factors which are used prior to doing a SWOT analysis (which is used to assess both internal and external factors).

PEST is used to assess business/strategy planning, marketing positioning, business and product development, product introduction, new idea, business diversification or to review the strategy or position of a organization.

There are variations to the PEST analysis like the PESTLE (includes Legal and Ecological/Environmental)

There are many situations where systematic PEST analysis gives clarity about the external factors which can affect the decisions such as :

  • Brand in relation to a market
  • Product Launch
  • Merger and Acquisition
  • Entering a new market
  • Potential Partnership
  • Investment opportunity
  • Company assessing the market conditions
  • Product versus competition

More Strategic Frameworks here.

MBA Buzzwords … What they will not teach at B-Schools…..Enjoy

MBA, B-Schools, Buzzwords, Management , Leadership, Funny Pictures, Jokes, Humor

 

Do you want to impress or confuse clients or Vice Versa?…..
Use Techno Vocabulary. It can be called the “Buzzword” Writing method.
It is simple.. Just select any 3 digit number
and choose the corresponding buzzwords from the above grid.
Don’t worry if it doesn’t make sense to you;
it won’t mean anything to anyone else either,
but they will think that you’re just smarter
than they are so they won’t say anything!!!!….
Have Fun… with this Super MBA Stuff….
what they will never teach you at B-Schools…. 🙂
LOL

Financial Measures of performance ~ What gets measured gets managed…

Financial Performance Measures, Cash ,Corporate Finance,  income, Value, Returns, Dupont, ROI, MBA,ROE, EBID, EBIDTA, EVA, NOPAT,

What gets measured, gets managed ~ Peter Drucker

Performance Measures should be linked to Value. Managers are evaluated based on these measures.  Of course, there are extremely important non-performance measures like Customer Satisfaction, Quality, Cycle Time which is important and not captured in the objectivity of the financial measures.

So what are the financial performance of measures which are commonly used….

There are four main categories of financial measures, which are used for performance:
CASH
INCOME
RETURN
VALUE

CASH FLOW MEASURES

Gross cash flow

Earnings before interest, tax and depreciation/amortization (EBITDA)

INCOME MEASURES

Earnings before interest and tax (EBIT)
EBITDA – Depreciation/Amortization

Net operating profit after tax (NOPAT)
EBIT ( 1- tax rate)

Net Income (NI)
EBIT + Interest Income – Interest Expense

Earnings per share (EPS):
Net Income/ # of shares outstanding

RETURN MEASURES

Return on Equity (ROE):
Net income/Total common equity

Dupont ratio:
(NI/Sales) x (Sales/TA) = ROI

Identify value drivers based on different components of ROE

Return on Capital Employed (ROCE) or Return on Net Assets (RONA):
NOPAT/ Net Assets (TA-Current Liabilities)

SINGLE PERIOD VALUE ADDED MEASURES

Residual Income (RI):
EBIT minus a charge for assets

Economic Value Added (EVA):
Stern Stewart measure of economic profit minus a charge for capital employed

Net Operating Profit After Taxes (Stern Stewart) –  (Weighted Average Cost of Capital)  X (Capital  Employed)

Venture Capitalists: What roles do they actually perform in their portfolio companies….

Venture Capital, Funny, Pictures, Private Equity, Roles, Management, Leadership,

Is value creation by Venture Capitalists a reality or myth?….

Whatever it is… there is no denying the fact that Venture Capitalists and Private Equity players have facilitated creation of industries …. accelerated emergence of new age business and led to creation of new breed of entrepreneurs… Here are some of the roles and responsibilities which a VC typically plays across functional areas of a organization in the hopes of a ‘HOME RUN’ blockbuster exit….

Broad functions Roles and Functions of Venture Capitalist in Portfolio Companies
Formal roles Informal roles
Board of director Member
Sounding board
Observer rights
Strategic functions Formulating business strategy Strategy sessions
Managing crises and problems Business advisor
Boundary spanning Selecting vendors and equipments Developing professional support group
Source of professional contacts
Source of Industry contacts
Finance related Obtaining alternative sources of financing
Interfacing with investor group
HR related Management Recruiter (Interviewing and selecting) Searching for candidates of management team
Negotiating employment terms with candidates Motivating personnel
Replacing management personnel
Marketing related Formulating marketing plans Soliciting customers or distributors
Testing or evaluating marketing plans
Operations related Developing actual product or service
Developing production or service technique
Supervisory Monitoring financial performance Phone calls
Monitoring operating performance Non board meetings
Seeking periodical reports
Interpersonal Friend / Confidant
Mentor / Coach

More on the VC here….

Business Today – BT Nielsen report – Top B Schools Ranking in India

MBA, IIM, Business Schools, B Schools, Business Today, Nielsen Ranking, Management, Leadership, 2012

Around 2,500 years ago, Greek philosopher Heraclitus of Ephesus had pronounced: “The only constant in life is change.” Think of change as a never-ending game – ‘The Change Game’

In the context of business education in India, an MBA degree from a premier institute has always been the key to riches, glory and recognition. (Perception……???)

This year’s ranking of the Top 10, too, suggests that at a time of turbulence in the economy, global and local, premier institues like IIM are considered the safe house.

More here Business Today article

IIM Indore 1 year EPGP Program – Full time MBA Courses Conducted Termwise!!!!

IIM Indore, 1 year Full time MBA, EPGP, Executive MBA, Core Subjects, Electives, Katz Business School
 
 
These are the crucial courses, which are conducted as part of the 1 year EPGP – full time MBA program at IIM Indore.
Term IV is conducted as Executive Leadership Program (ELP) in association with Katz Business School, Pittsburgh. The ELP program is offered by the Center for Executive Education (CEE) of the University of Pittsburgh Joseph M. Katz Graduate School of Business.
 
Core Courses Term I, II, III, & IV
>  Theory of Firms and Markets
>  Financial Reporting and Analysis
>  Business Communication
>  Marketing Management
>  Decision Analysis
>  Business Statistics
>  Perspectives on Individual Dimensions
>  Perspectives on Group and Organizational Dimensions
>  Strategic Management
>  Strategy Implementation
>  Corporate Strategy
>  Corporate Governance and Management Control
>  Problem Solving and Creativity
>  Global Management
>  Entrepreneurship & Venture Management
 Elective Courses Terms V & VI
> Business Analytics

> Business Optimization

> Supply Chain Management

> Project Management

> Business Process Redesign

> Pricing and Revenue Management
> Supply Chain Management

> Logistics Management
> Business Analysis & Valuation

> Equity Investment Management

> Project Finance & Structuring

> Behavioral Finance

> Corporate Performance Management
> Options, Futures & Other Derivatives
> Corporate Performance Management
 > Management of Insurance Business

> Alternative Investments
> Strategic Management of Acquisitions & Divestment
> Competing Through Business Models > International Management
> International Marketing

> Brand Management

> Consumer Behavior

> Sales and Distribution Management
> Retail Management
> Integrated Marketing Communications
> Internet Based Platform Strategy
> Enterprise Resource Planning

> Business Intelligence
> Game Theory

> Global Business Environment
> Negotiation
> Venture Capital & Private Equity
> Corporate Banking
> Marketing Strategy
 
 Note: This is list is not exhaustive and lists the crucial courses of the program

May 2012

Is GOD on Facebook…because everyone else seems to be: Growing impact of Social Networking

Facebook, IPO,  Twitter, Orkut, Pinterest, Instagram, Social Media, Social Networking, Management, Leadership

Facebook has more than 900 million users (that makes it the 3rd largest country in the world). Half of them log on everyday. Online population in this category is galloping at 50%

Social Media is growing at a breakneck speed: 64% of all internet users possess at least one social networking account

Social Media having an impact. In fact it is emerging as the fastest news channel. Here are some examples

  • first public news about the abbottabad assault appeared in social media
  • sunanda pushkar sweat equity controversy broke on twitter
  • ram sene controversy raged on facebook
  • news on earthquakes, blasts etc. anywhere break first on social media nowadays
  • jasmine revolution in egypt – part of the larger arab spring uprising, started and spread primarily through social media (wael ghonim, the man responsible, worked at google)

Social media makes a lot of dollars not just sense

  • google invested $100 million in zynga, creator of blockbuster online social games like farmville and mafia wars
  • nielsen report shows nearly 23% of americans spend their internet time on social networking and blog sites
    (mere 4% of their time is spent searching)
  • facebook, valued at over $100 billion, is now the 3rd largest american internet company with a blockbuster IPO behind it.

Harnessing the power for a connected future : consumer empowerment & the gradual shift in power from producers to consumers , Some examples show this:     

  • Dhaval walia’s facebook  post against vodafone’s pathetic 3g service in mumbai was covered in media
  • When greenpeace exposed that palm oil in kitkat came from indonesian rain forests, Nestle changed its buying policy
  • Procter & Gamble sent director farah khan a month’s supply  when she tweeted about  shortage of “pampers” baby diapers in Mumbai
  • It played the role of a catalyst – rallying point for mass movements that impact the society (anna hazare hunger strike, debate on jan lokpal)
  • great tool to build employee engagement and foster team spirit
  • accessing and making use of a bigger sphere of information from known connections.

Facebook, Twitter, Orkut, Pinterest, Instagram, Social Media, Social Networking, Management, LeadershipSocial Media: so one can love it, or hate it, but ignore it at your own peril.

Only time will tell if businesses will be able to harness the power of connections to make sustainable business models and reap economic profits.

Till then it’s just another brick in the WALL……

Procter & Gamble – Foundations of Branding leading to decades of success!!!

Procter & Gamble, FMCG, Branding, Marketing, strategy, Innovation, Brand Management , Success, How the Foundations of Branding led to the dominance of P&G in future years using Innovation, Strategy, and Branding & Responsiveness.

Strategic Vision & Risk taking ability of P&G led to the companies’ dominance in the early decades.

The company was started amongst financial crisis with the founders focus on competing with the other manufactures of soap and candles.

Even during the impending civil war rumors in 1850’s, the founders went ahead and built a new plant. Needless to say in 1862, factories were running to full capacity during the civil war and P&G also earned the reputation of ‘Soldiers return home with P&G products’.

Innovation, technology and Strategic progressive thinking in marketing efforts and employees partnership programs led to the beginning of branding and positioning of the products and led the company in the decades leading to 20th century. Eg: Introduction of the Ivory soap as pure and a floating bar and subsequent nation wide large scale marketing efforts to promote the soap.

Employee partnership programs were initiated as a strategic response to the unrest.

By end of 19th century company had innovated 30 different type of soaps and launched full scale marketing efforts to fuel consumer demand.

Global Expansion, Growth of Product categories & Introduction of Brand Management System

The Global Management system was born out of a need for managing the multiple product categories and brands across many countries.

Under the brand management system, each brand manager was responsible for managing and competing with both external and internal brands.

This was breakthrough in branding and led to dominance and beginning of a system to be successfully followed in decades later.