I've been studying enterpreneurship for the last 5 weeks and only yesterday did I realize that I've been surrounded by enterpreneurs for the larger part of my life. My uncle was visiting us at ISB and he casually mentioned that we should run a business from home and our immediate response was "We dont have any capital"
Pat came his reply - "What makes you think you need money to start a business?"
This is so perfectly inline to what I've learnt but somehow i just couldnt apply it to what I've been seeing for so long around me.
A manager in an automobile firm who quit to go solo as a consultant with zero capital but a huge desire to solve problems and a huge f-network in terms of industry contacts. Buzz words applied to real life! The f-network is what all enterpreneurs go to first, their family, friends and fools (The three f's)
A college teacher and social work post graduate who started a kindergarten in her own house. Once again, monetary capital was Rs. 5000 and nothing else, just a true love for children and molding minds. She has run her school with every possible leadership principle I can think of. And she doesnt have an MBA and definitely doesnt need one. I'll be using what I learnt here to take the school to the next level.
An army colonel who started an HR consultancy. Easily one of the most brilliant people I know, all he had was his tacit knowledge of people management skills and he has converted it to a flourishing consultancy with a huge demand for his services in the corporate sector. He is the author of a number of books on assessment and human resource management.
Another factor that I must state is that all three have an extreme desire for independance in all that they do.

I really must be dumber than I thought before, for not realizing all these things earlier. For needing a course in enterpreneurship to appreciate what I should have seen many many years ago.
What also comes through is that if you do what you love, you will do it well. I know it doesnt take a genius to tell you that. But it does take genius to figure out what you love and it takes courage to follow that dream. Trust me - I've seen that courage, only today I've been able to put it down in words.

Three cheers to all three of you! I think I appreciate the enterpreneur more right now than I have all term long.

and sophisticated too....As a group, investors are brilliant although individually they lack information and intelligence.
This takes me to ask a question. Is being a doctor/an engineer or a soldier the best way to make a difference to humanity? A doctor heals, an engineer creates and a soldier defends that which matters most. So who is it? My take for today is that it is the economist. Deregulations and market economies will do more for humanity than all the rest can. The good news for doctors, engineers, soldiers and MBA's is that we can all be economists. Economics is often referred to as the dismal science. If we were limiting our discussion to how I scored on the test, I would agree.
However, I believe that economics is the science of quantifying the dismal realities of humanity. For example, in a market with no differentiation and unlimited capacity -prices will fall to cost. This is good for you and me, if we are buying but please take a moment to think about those poor guys that produce salt. (or services software, very soon I fear)
The economic reforms in India have done more for India than all the medical breakthroughs, wars or infrastructure had done by themselves in the past 40 years preceding 1991.
The license raj and other foolish investments by our darling chacha Nehru are proof that bad economists can do far more damage than any other bad professionals.
If you are feeling rather pissed off since Chacha Nehru and Indira Gandhi are awesome and have truly developed our country - Go read Gurcharan Das' book called "India Unbound"
If you still think he is wrong - Lets talk
If i made you read the book - My work is done!

Forgive me for wavering from my usual topics, but here goes

At what age does happiness from material possesions start diminishing? I remember the first pair of football studs that my parents got me for my birthday - I slept with them next to my pillow and woke up as happy as i could be.
I remember my first "Indiglo" watch, I spent unending moments switching on the blue-green light and looking at the digital display in awe of the beauty that it was.
I remember my first pair of Lee jeans, my first pair of Adidas sneakers, my second pair of Adidas sneakers. Much more recently, I remember my first cell phone The Sony CMD J70 with a jog dial, bought with a view to reduce the costs of long distance telephony (I was a cost-benefit guy even then), although costs didnt reduce at all, I loved my cool phone for all the kicks that it gave me. I loved my first cycle, the red BSA SLR and I used to fawn over it to no end. Every birthday was the highlight of the year, and birthday presents were the highlight by all means! How I wish I could have thanked everyone for their gifts in proportion to the happiness that they gave me.
A few months ago, I bought a new cell phone. I dont know the model number and I dont care. I ripped it out of the box, plugged the SIM card in, put it in my pocket and moved on. No happiness of the new possession, no fawning, nothing.
I bought a laptop a couple of years ago, same story, absolutely no "sheer happiness of possession" so to speak. The same goes for every piece of apparel I buy today, its just functional, since I dont want to be seen in torn ragged or ill fitting apparel. Even my latest Indiglo watch. Which is really the reason Im writing all this, I happened to look at the blue glow of the time and realised how ....whats that word.......cold or something like that i've now become to material possessions. Am I John Lennon? I doubt it. But somehow new stuff just doesnt make me happy anymore.
I wonder if it is a higher level of spiritualness, YA RIGHT!!!! Somehow either the bar for getting excited has really been raised or stuff just isnt much fun anymore.
Another factor that takes the glint away from enjoying new stuff is having stuff. The everpresent law of diminishing returns. I'm beginning to get somewhere!!!! Wow!!!

Also, it could be a tendency to have gone overboard with that cost-benefit thing. And learning about net present value and depreciation hasnt helped. I want all my money to be growing into more money, not sitting tied up in a pair of sunglasses. This underlying mindset maybe getting in the way of enjoying my stuff.
Again, I spent 2 months evaluating which camera to buy. At the end of all the analysis, it just didnt seem much fun anymore.
It makes me a more difficult person as well, I realize, when nothing material makes me happy.
Maybe I should ease up, but its really really hard. This was step 1 of acknowledging my latest mental problem. How do I deal with this??? How do I make my eyes shine when I see the Indiglo glow?

Disclaimer:This entire blog entry refers only to happiness from material possessions. I am as happy as I could be with life, which tells you that everything else is really great to make up for the happiness thats not coming in from material goods and so I request you not call/fax/email/drop by to check on me, especially not with a gift in hand (You know it wont help).

Why you ask - Here goes nothing...Ask yourself this question - if you had to lock your house door and not ever go out, how long could you survive?
I'll make life better for you, lets say you had a little garden, ok so you could provide yourself with food - but how long would it last? and lets say you never learnt farming, you went to a classy school and learnt to write software. Nobody inside your house needs software, they need food, water, shelter and clothing.

Do you see why you need to open that door - you can write software, somebody else can farm and a third person can stich clothes. Hence, we all need each other for something or the other.
Similarly, think about this, you earn Rs. 20000 every month and you want to start a business for which you need Rs. 2 million. Lets now imagine that there no banks, what do you do? Assuming that you need Rs 10000 to live every month, do you wait for 200 months? And will your idea be worthwhile? NO
So what happens in the real world, me and 199 others save Rs. 10000 every month in ICICI. They give me an interest rate of 4 % and then you the more enterprising people who want to start businesses go to ICICI and ask them for the money. ICICI lends it to them at 10 %. This is how we, the humans have moved ahead of the tigers and sharks of the world, who are much better than us at eating and hunting their own food :-) Hence, the peoples money in the bank is called "savings" and the money borrowed by companies to start/run ventures is called "investments".
Now applying that to North Korea, which is the last closed economy of the world, which means that no money goes in or out of North Korea. So now, when enough people save and enough people invest everything is hunky-dory, however the day too many wise guys with great ideas come along, there just isnt enough savings to support all the investments. What happens now - Great businesses dont start and the country doesnt advance. This is exactly what is happening to North Korea.
The difference between the "savings" and the "investments" is the current account.

I got a bit pedagogic on this one, but i couldnt make up enough analogies - I'll work on a better analogy next time - I promise :-) I'll probably try and deviate from the interesting world of economics and go to why Bajaj Auto is such an awesome company.
Till then, heres a thought to ponder on - did you know that humans are the only species to drink another species milk? and we are also the only species which drinks milk after we have grown to adulthood!

 

Today I shall attempt to capture what I thought Marketing was, and what I think it is. My views split in a pre-Raju and post-Raju era. Who/What/WTF is Raju?
Prof. Raju is the insightful and motivational Area Leader for Marketing at ISB. He has shown me that marketing is not about having a loud voice or an ability to say "I'm going to sell soap" with a straight face. I bullshited my way through an NMIMS (a b-school in bombay) interview with I want to do marketing because I thought the cola wars were cool.
Amongst Prof. Raju's phenomenal observations is that MBA's tend to have an urge to go where no one has gone before. He has this to say "Well, perhaps there is a perfectly good reason not to go there"
Coming back to quantifying marketing. Being a management subject, it can never be wholly quantified, but you can get bloody close. Yes, and it works.
Let me get my hands dirty in this one. How can you tell how successful you will be if you enter an saturated market? Lets say you are a company called YellowTeeth Dental Care. Colgate was here before you and has 30 % of the market and Pepsodent is here too. Hence, you are not the pioneer, not the follower, but a late entrant. Ceteris paribus, how well will/should you do? - You will get 1/sq.rt (3) of Colgates market share.

Why? Because a lot of smart guys at BCG (Boston Consultancy Group) got together and figured this out after going through a whole ton of brands and industries and the success of pioneers and followers in those industries. This is an empirical formula, but its a formula. Not a soothsayers belief.
Let me throw out some trivia about pioneers here - Guess who was the pioneer in the chocolate cream-filled cookie industry.
Oreo? - HAHAHAHAHAHA no way
It was a company called "Hydrox" - No prizes for why they didnt do well ;-)

This is easy. What? Blogging about learning, while at ISB. Everyday, I learn something that I really want to talk about.
So what was it today? Linear programming.....uh naaaaah....cant see myself making interesting analogies there.
Football - Yes, I saw true uncontrollable happiness yesterday. It was pure joy that only something like football can give. My batchmate Piero, who hails from Italy, was the truly happy soul.
When the final penalty was taken, his joy was only matched by his loud chants of "Forza Italia ALE ALE ALE".  I have never seen anybody so visibly happy in a long long time. My learning from this is that if you are Italian, you were probably very happy. (Not quite as intriguing as economies of scale, or non-verbal communication, but if you think about it - far far more applicable). An added observation is that it may be a good time to buy stock in Italy. Typically the World Cup winning nations GDP goes up by a couple of hundred basis points at least.
I really hope that there are people reading this who don't know what a basis point is. This is for you :) A basis point is 1/100 of 1 %. So when the guys on the stock market say the market is up by 50 basis points, all they are saying is that it is up by half a percent!
I also learnt that women especially those named Nicol David can smack a squash ball really hard. We saw the WISPA womens world squash finals live yesterday at the Faluknuma Palace. A huge thanks to Prachi and Gaurav who got us the tickets to a by-invitation only event.
The venue was absolutely beautiful, with the palace in the backdrop and the all-glass squash court all lit up in the middle of the palace lawns. http://www.wispa.net/nm/anmviewer.asp?a=391&z=1

 

I was just told that in a business presentation skills class that non-verbal communication constitutes 93 % of all communication.
This is not what I learnt today. I learnt today that these Business presentation skills are really bullshit!
Are you kidding me?? 93 %. Are we saying that we, the eloquent, should just pack our bags or rather our tongues away and learn sign langauge? or "body language", the much over-rated langauge.
All you presentation consultants out there - I BEG TO DIFFER! - If 93 % of communication is non-verbal, how does music work? How does the radio have any listeners? Why then, do we read?
Really, we will buy your consultation sessions even if you don't give us this mumbo-jumbo about 93 %
My learning for the day is that nobody really needs these business presentation sessions.
If you are good, they can't make you better.
If you suck, it won't help! Go to toastmasters instead, they can help!

 

 

 

Henceforth, this blog will feature a write up on what I learn each day. It could be about what I learnt in class, or at the squash court, or just a new way of flushing but it will be something I learnt in that day.

I will try and set the tone for this blog by saying this. My statistics professor would ask us to explain each concept as if we were speaking to our mom at the end of the day, and she asked us "Son, what did you learn today?". The attempt will be to put things down in langauge that mommy will understand. In my case unfortunately, Mom is far superior in understanding to me, hence it will be langauge that mommy would use so that I would understand, but I think you get the picture.

Here goes today - Competitive Strategy - case in question Walmart and how it has sustained its edge over everybody else for the last 30 odd years. This is my favorite reason, and its called "First Mover" advantage.
Against conventional wisdom, which said that the only places that were big enough to handle big huge discount shops, and give them as much sales as they needed to succeed, were the big cities.
Walmart would set up shop in small towns all over America. They would set up very big shops and sell things very cheap. Now this small town only has a certain number of people and they can only buy so much. If Walmart's competitors looked at this town, and evaluated what they would earn by coming to this town, it would be apparent to them that now that Walmart was there, if they also went there, both companies would begin to incur losses. Hence Walmart had taken the "first mover" advantage.
Another fancy term for what Walmart did is called maintaining a sustainable competitive advantage by achieving economies of scale within limited capacity markets.
I rather like the phrase "economies of scale" - all it means is that there are some things that get really cheap if you do a lot of them. For example - it would probably cost a whole lot more if you chose to fly across the Atlantic ocean alone but if you fly with 400 other people in a Boeing , it costs you a lot less. The purists will say this is wrong. OK, so let me write it the conventional way - If you decided, for some strange reason to start a factory that produced condoms, lets say. Whops, BEEP BEEP - this is supposed to be an explanation to your mother, so I shall change that to "Ice cream" instead. You would have to buy a big fat refrigerator, some big ice cream making machines amongst other things. If it costs you Rs. 100 for the electricity in your icecream factory, then if you made and sold only 1 scoop a day for Rs. 10, it would not make up for the cost of electricity for all the machines you bought. You would have to make 10 scoops (and sell them) at least to cover up your "fixed costs" , i.e the cost of electricity, this cost remains the same however many ice cream scoops you make. Now if you made thousands of scoops, the fixed costs would really be very small compared to your profits.
Now imagine that your fixed costs were Rs. 10 crore. You would really have to sell a whole lot of ice cream to make up for that cost.
Taddaaaa - You can now go tell your friends that you know exactly what "Economies of scale" is.
A last word before I go and study some more. An industry that cannot achieve economies of scale is not a bad one, actually it may be a very good industry to get into. Eg. - Art - MF Hussain doesnt need to make a whole lot of paintings every year. Just one does the trick :-)

 

   A nation has awakened to the bullshit that reservations are. The docs in Dehli are on strike. If I could, I would too!
Its a f*(king hopeless battle that the "General" candidate such as myself has been fighting for the last 20 years. Yes, the underprivileged need to be supported, but not like this. There are a million ways of doing it, and the method of alloting seats on the basis of surname is easily the worst!
Give seats to the economically backward. Thats fair.
Give the economically backward folks more tutions. Thats fair.
Give the guy who has the right surname admission! - THATS BULLSHIT. Its just flipping the entire caste system around backwards.
There are folks that will say - You know what - You (i.e. brahmin assholes like me) have had it your way for 1000 years, now its our turn!
Man, that is some bullshit. If we keep going at it, when does it end? Answer me this my backwardly forward minded politician!
Med. students all over the country are standing up in support of the reservations issue. Information Explosion. Just like Rang de Basanti predicted - A generation has awakened.
And to you Mr. Vote-Crazy-Politician-guy - just like Rage against the Machine so rightly put it
F(*K YOU I WONT DO WHAT YOU TELL ME
F(*K YOU I WONT DO WHAT YOU TELL ME
F(*K YOU I WONT DO WHAT YOU TELL ME

 

ISB rocks. I was certain that I would meet people with excellent minds here, however I did not forsee the excellent footwork.
Everybody here is living out a return to school, a return to the camaraderie that only sports can bring.
Every evening, the junta rushes their respective sports haven, be it the gym/basketball/football/squash or tennis. The squash players are excellent and the football has also been as good as I can ask for.
I'm done playing hard, now its definitely time to study hard. Unfortunately, the inspiration to play comes a lot easier than the inspiration to study.
A tournament is coming! Will I be able to resist the urge to micromanage the football team? I better! I better grow up....I'm not Ronaldinho!