Thursday, December 22, 2011

Are We Hiring for the Right Reasons?



Had a long chat with an entrepreneur friend yesterday.  He had set up a concept restaurant which was extremely successful and he wanted the business to grow for which he needed people. Was discussing with him on what he was looking for a person who would manage his operations. In what would have been a typically short "job description" defined role tuned out to much more that.

Which got me thinking. 
  • When we hire personnel, are we being strait jacketed by the job profile? 
  • Are we not looking at attributes which signify an average regular professional rather than an excellent one? 
  • Are we more bothered about what the person has done before? 
  • Don't we reject persons for what they have done and not what they can do?  
In a hurry to hire people who fit the job description we are not looking at people who can contribute much more. Here is a list of the criteria which I would look for in a person
  • Positive Attitude - To me the most important factor is finding people with the right attitude. You can teach a person all aspects of a job but no matter how good the person is, if he does not have the right outlook, no program will help. A person may have the aptitude but without the correct attitude the person is as good as a nobody. Hire for attitude and train for skills. Infact I rather hire a person with 0% aptitude and 100% attitude. The person can atleast contribute to the team, thereby to the success of the team. 'It is true that one rotten apple can spoil the rest'
  • Self Motivated/ Starter -These people require less supervision or any prodding to get the job done within the parameters set. Once the employee understands his responsibilities he/ she will work towards the completing the assignment at hand. Moreover self-motivated people will make efforts to learn new aspects and implement it.
  • Strong Self – Confidence - Believing in one self-separates the haves from the have-nots.  The personae of self-confident people can be infectious and inspire others. Self-confidence comes from understanding of the job/ role and also attitude.  They are not afraid to ask questions when they do not know. The self-confident person does what he/she feels is right and is willing to take risks. These people don't let mistakes affect their performance and instead learn from them. Most importantly they have faith in themselves. A team leader will find it difficult to manage each and every person but can hire people who can manage themselves.
  • Risk Taking Ability - The ability to take intelligent risks is an important ingredient in a person's success and a huge determinant in anybody's level of achievement.  Sub-optimal performers settle into their comfort zone and play safe, falling into endlessly recurring patterns. They stop challenging themselves in significant ways. By contrast, top performers are talented and persistent risk-takers.
  • Decision Making Skills - Taking decisions and that to in a timely manner is a necessity. Many employees prefer to leave the decision making to others. Both amounts to procrastination and hinders the progress of any project. 
  • Team Player - A team player is willing to be an active participant who shares openly and cooperates with the rest of the team, thereby respecting each individual in his team. He will show flexibility, communicate effectively and take a problem solver approach. For the greater good of the team he will be willing to put his personal objectives aside as it may contradict with the teams for the greater good.
  • Creativity/ Lateral thinking - As we move to the experience economy any job or project requires creativity in thinking especially in customer facing functions. Creativity is not restricted to the arts domain  but are also solutions to problems - for a sales person in the B2B space to a techie designing an app for the smartphones. A judicious mix of right and left brain is required in any professional. While the term 'out of the box' is often misused, it is becoming necessary for professionals to look at alternatives which are completely unique, different and away from the beaten path.
  • Failure - I have noticed that failure has always been the path to success. A failure is not a crime, the ability to learn from it contributes to lasting success. Failure will help people learn, let people look at various alternatives before arriving at a decision, and more importantly drives change in the way a person works or tackles problems. Failure also makes people work harder so that they are not repeated.  
  • Adaptability - The market is a dynamic place and by that extension so is the workplace. We need people who are adaptable to the constant flux.  Adaptability also means adapting to the personality and work habits of colleagues. By viewing change as an opportunity to complete work assignments in a more efficient manner, adapting to change can be a positive experience.
While I do not question the need to hire people with the necessary skill sets for the job, I feel we need to go beyond that. 

Monday, December 12, 2011

How the Nonsensical can be a Rage (Kolaveri Di)

It was on November 21, 2012 when a Tamil sounding phrase started trending on Twitter - #kolaveridi. I had innumerable friends on Facebook share the link to this phrase/ sound - over 6 million shares!
I thought this was a new virus which was multiplying really fast and many were getting suckered into it.

Fast forward two weeks hence, more than 18 million views on You Tube from over 140 countries. This song was a rage. A frail looking man singing ' nonsense' as he called it himself, to a folksy beat! A song which had pretensions of being a Tamil song - but 90% of the lyrics were in English!

On a personal note, I thought it was a inane English song, with absolute illogical lyrics and the only saving grace was the Koothu ( a Tamil beat/ music) beat. See and hear it for yourself  - http://goo.gl/5mN2J


The numbers speak for themselves and to get so many people interested in a song takes something. Social media and other online devices are effective tools to communicate the song/ content. They serve to distribute the content and create a viral. But it took more than that to create such a hit. A look at some of the reasons:

  • Focused Target Audience
    • With 50% of India under the age of 30, the chances are that anything that appeals to that age group is sure to be a success. The funny thing is that even the above 30s want to feel young and aspire to be a part of the age group. This song hit the right chord with the youth and young at heart.

  • Uniqueness
    • Natural feel (if not impromptu) - The song had no exotic dances, no oomph nor any of the typical attractions which represent a film song. The element of glamour was missing and present. There seemed to be a natural ring around it. It showed some talented individuals (forget their pedigree) joining together and creating a song. The typical film sequences which you expect around a film song were absent. The presence of glamour came from the individuals - many of them stars in their own right, in non filmi surroundings. In an indirect way the film was underplayed.


    • Transcending language barriers -The song appealed to many sections of the multi lingual Indian population or the diaspora. English is largely understood by most in India. The lyrics of the song were not jingoistic and was not restricted to the typical south Indian populace.  Infact earlier songs which a mix of Tamil and English like 'Urvashi Urvashi, Take It Easy Policy', 'Mukkabala O Laila' and 'Mustafa Mustafa, Don't Worry Mustafa'  have all been fairly successful. It is the adoption of such lyrics which transcended language barriers which led to easy comprehension and adoption. 

  • Simplicity
    • Lyrics - Cow-u Cow-u and Moon-u Moon-u, all inane but simple lyrics-u! Even a kid like my son could sing this song. Why even Nivaan - Sonu Nigam's young son, could sing it! There was no deep understanding required. 
    • Music -There is a pronounced absence of complicated instruments/notes in the song. The omnipresent sound of the percussion holds the song together. Any amateur singer could sing this with any surface serving as a percussion instrument. This clearly would be a hit with the bathroom singers!

  • Self -Identification
    • The youth of today will only feel connected when they can identify with it. From the use of youth stars/ icons to a cool quotient brought in by all components of the song.  In effect the song brought in stars from different backgrounds - Dhanush has a rebel, common man kind of image; Shruti Hassan comes from a very pedigreed background with a certain hip factor; Aishwarya came in from ' God's" family and Anirudh was all of 21.  The diversity of the stars was tied in together by the song. The diversity blended in. 


  • Imagery
    • The way the whole song has been put together has a certain hip factor to it.  Youngsters in the video convey a certain 'I don't care a damn' attitude. And what's more they seem happy doing what they are doing. The cool quotient ranked very high. 

In conclusion this was a brilliant execution of marketing both the idea and the execution tied in together to create a rage. While the producers may have never expected the song to be such a hit, unwittingly they have hit the right notes!

Monday, December 05, 2011

What Modern Trade can Learn from Mom & Pop (Kirana)

Enough has been said about the FDI in retail (in India). And my views are very clear. I also strongly believe that the Indian players can stand the might of MNCs and infact capitalize on the efficiencies which these MNCs will bring to the table.
For the uninitiated, kiranas are shops that cater to the regular needs of food, grocery and also products like paan, cigarettes etc. within a locality/catchment area. There are also others like the headload and pushcart vendors.

Globally, as modern trade expanded, both organised retail players and unorganised retail participants have co-existed. The Walmarts and Costcos have co existed with the mom and pop stores (in India these are  called kiranas). I do believe that there is no reason why it cannot co-exist here in India.

However there are a few factors apart from systemic deficiencies which have worked in the favor of kiranas or the local store owner/vendor. 

Personalized service
  • Personal/ social touch
    • Ashraff, the person who runs our neighbourhood store knows all our family - where we stay, what we buy and our tastes. There is friendly banter and a relationship not just based on transactions. If he is free, he will discuss with you, the issues in the area and also about his family. When shopping ceases just to be transactional and more social, then the relationship has moved to the next level. Shopping becomes more a social activity rather than a mundane one. 
  • Knowledge of buying habits
    • Ashraff has a pulse on the consumer behaviour in our area.  He has a detailed understanding of consumers’ shopping preferences and habits - he knows what will sell, who will buy it and even at times when they will buy it. Even if a product is not available he will ring up the distributor and then tell you when he will get it. This level of knowledge is something modern trade needs to obtain. Analytics etc. are tools to facilitate this and while I do think it will be difficult to replicate in modern trade, a fair degree can be reached.
Daily top ups
Kiranas meet the needs of consumers who need to do daily top-ups of select food and grocery items. While the variety will be limited by virtue of size, kiranas keeping track are able to supply the daily and immediate needs. Modern retail formats offer the ability/ facility to buy several SKUs under one roof, but facilities do not exist to supply the customer daily/ immediate needs. The system needs to be re-engineered to work around this.

Order through telephone 

Given the proximity and relationship, we can call Ashraff and ask him for the products we want. We do not need to go physically there.

Home delivery
Within some time, we will have what we asked for at our doorstep. This kind of service endears us to the kirana. The convenience is unparalleled and sees us avoiding a lot of time and trouble to get the products home.  Modern trade can surely steal a page out of Ashraff's notebook and replicate with modifications ofcourse!

Credit
Ashraff allows us to pay once a month. I don't have to take my wallet each and every time. Actually he is smart, since I don't pay immediately, I end up purchasing much more than I require. A gentle upsell!


There are certain aspects which large departmental stores cannot replicate and hence there will always be a necessity for kiranas. The best which modern trade can do is to customize their services taking the key learnings from kiranas with the hope that the twain shall meet someday.

Sunday, December 04, 2011

Why is the Indian Consumer Being Shortchanged? - An Opinion on Retail FDI

On November 24, the Union Cabinet decided to permit 100% foreign direct investment (FDI) in single-brand outlets and 51% in multi-brand stores. The opposition as well as some allies of the UPA have been vehemently opposing the decision, saying it would affect the small shopkeepers (kiranas), demanding a reversal of decision.


India has been known as the nation of shopkeepers, for every 1000 people there are 11 shops, and these shops include the paanwallah, sabziwallah, the barber etc. Unlike other nations which have densities of around 5 (UK and USA), the Indians are serviced far better by the neighbourhood store. According to a study by industry body FICCI, the total retail trade in India was worth Rs 11,00,000 crore in 2003. Of the approximately 12 million retail shops, 96% occupy floor space of less than 500 sq ft.


With over 120 crore consumers India is a land of opportunity, modern trade has only tapped 5% of the business. This is just a start. 


The proliferation of the neighborhood stores is to exploit the systemic deficiencies in India. Poor supply chain, poor cost control, archaic rules etc. have resulted in a mushrooming of such stores. Agreed that the there are certain outlets like the paanwallah which cannot be replaced.


The lacunae in the system cannot be reasons for the opposition from the 'opposition'.  Some of the issues which will be tackled are:


Supply Chain

  • Thanks to our public distribution system, more than 50% of the production goes waste or is siphoned off illegally . More than a third of the fresh produce goes waste because of lack of distribution.  Rs. 8,000,000 crore is worth of farm produce traded annually through a network of 28000 wholesale agents and primary rural markets and 7500 regulated markets across the country. Wastage is high because India has only 5400 cold storages most of which are used for potatoes. Imagine 50% of produce going waste!
  • Moreover in the existing supply chain there are 7 layers between the farmer and end consumer resulting in a commission or added cost
Benefits 

  • It has been projected that with efficient SCM, thanks to modern retail, there will be a  reduction in layers from 7 to 4.
  • There will be a huge reduction in wastage and thereby improve earnings for the farmers to the tune of 15%
  • End consumer prices may also be reduced due to increased efficiency
    • Columbia University, in a study has mentioned that inflation can be controlled.
  • Indirectly agricultural  productivity which was  far below potential would work towards maximizing outputs as the life of the produce would increase. So in non seasonal months - agri produce could be sold. Seasonal fluctuations could be avoided

Archaic Rules

  • A law which was meant to help farmers but proved to be a bane is the Agricultural Produce Market Committee (APMC) Act. Rather than protect the interest of the farmers it is the middle men who gained from this. With a 70 - 80% increase between farm and final store prices, the middlemen make the maximum money. 
Benefits

  • With the middlemen ruling the roost, reduction in this will actually benefit both the end consumer with lesser prices and farmers with more earnings (pl refer earlier example)

Employment

  • With only 5% of trade covered by modern retail there is huge potential for more employment. Experts feel that FDI in the  retail sector will boost employment and has the potential to create about 80 lakh jobs in the country.

Capital

  • Efficiency is the crux of the retail business. Single digit margins are achieved by use of expertise gained over the years. This expertise requires huge investments in technology and other infrastructure. Given the experience till date, Indian companies have only scratched the surface and they lack the capital to take modern trade to the next plausible level. Hence it becomes more imperative that the FDI will bring in the necessary financial investments.


The Chinese Story
When China opened up its retail industry  in 1992, it brought in over $22-billion FDI in the span of a decade.  Today, 40 foreign retailers with hundreds of local retailers make up a $1-trillion industry, expected to double in five years.  The retail industry grew at 19.4% annually since 1992.

Interestingly traditional outlets increased (not decreased) from 1.9 million to 2.6 million over a five-year period. Retail employment shot up from 4% to 7% of the labour force.

The Indian Story (Other)
Whenever we talk about opening up the market there is talk about selling our soul to the devil. It seems to be a crime to ask a foreign company to do the job more efficiently.


In 1991,  the then-finance minister Dr. Manmohan Singh opened up the economy much to the disdain of the naysayers. The results speak for themselves - GDP growth has accelerated from just 1¼% in the three decades after Independence to 7½% currently, a rate of growth that will double average income in a decade.


Every industry which has been opened up from electronics to automotive have only served to increase the options for consumers. With stiff competition, Indian players have also played catch up and are giving their foreign counterparts a run for their money. 


Final Shots

  •  Why should the end consumer pay the price for inefficiency?
  • Why should they pay the price so that certain sections (especially the politically connected) are able to fatten their bank balances? 
  • Why should these few hold hostage to the majority?

Do we want to perpetuate the past or take the future road to prosperity?

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