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Category Archive : Uncategorized

My atrocious car buying experience is a lesson in after sales treatment for all founders!

I am re-reading How to Sell Anything to Anybody by Joe Girard (book review coming soon).

Earlier today, I finished his chapter on Winning After the Close wherein Joe talks about the importance of ensuring customer satisfaction AFTER completing a sale. He gives examples of how he goes out of his way to ensure that his customers sing his praises to their friends and family. He links the importance of satisfying his customer to the Girard’s Law of 250, i.e., each person has a direct connect to 250 people; therefore, an unhappy customer can directly influence 250 people. Consequently a salesperson or a business that disappoints two customers a week will have 26,000 negative influence every year!

Why is it important to follow what Joe Girard says? For starters, the man still holds the Guinness Book of World Records for being the most successful car salesman in history. This man was selling six cars a day (on average) while the average salesman struggled to sell one. He was out making $500,000 a year selling cars in the 1970s, i.e., eight times the per capita income in the US of A – TODAY!

So yes, when that man says something – it is worth our time and attention.

I am coming back to my point for the post today.

I just bought my first car in India. It was an important moment for my team and me. We were ecstatic on getting the car delivered on Tuesday evening. However, instead of reveling that moment and remembering it for the years to come, all we cannot forget is how the salespeople delivered the car with just enough fuel to get the vehicle to the closest petrol pump!

The saleswoman blamed the empty fuel tank on some dealership policy of ensuring that customers get a bone dry fuel tank. I could not disagree more with her firm, her firm’s strategy, and finally with the saleswoman herself. If she was so embarrassed about her firm’s stingy policy, she could have ensured a happy customer by filling up the tank herself – she would make more than the Rs. 2200 it cost me to fill the tank.

Buying a car is one of the most important purchases in one’s life. I can still remember, like yesterday, the first car I bought with the money I earned by working during the first summer semester in college – a 1996 Mercury Sable with a v6 engine. I was so proud of the car even though it was six years old at the time of purchase. The moment gives me goosebumps even today.

Then 17 years later I buy my first car in India, a Honda Civic, and it is an expensive car (for my standards), but it was delivered as though the dealership was running out of money. It left a sour taste and you won’t have to think hard whether this dealership (Arya Honda) will be recommended by me to anyone. The answer is no.

I must re-emphasize that a happy customer is the best salesperson. He/she will boast about his/her positive experiences to their closest network. On the other hand, an unhappy customer will tell anyone that would like to hear him/her of their negative experiences and feeling cheated by a car dealership. Unfortunately, these car dealerships operate under old maxims therefore continue to misread their customers. Any start-up founder that is reading this post should not.

Your customer whether they are B2C, B2B, B2B2C or B2B2B or B2B2B2C (and so on) must be happy with their purchase of your goods or services. To hide behind the veil of corporate policies is the old way of doing business, and you must ensure that your salespeople are sufficiently empowered to ensure post-sales customer satisfaction, at all costs! It is just as important that those negative experiences are corrected by changing policies and processes.

The process in which the company acquires a customer, gives them lousy experience, and allows the salespeople to blame an insane corporate policy is a sure indication of a deeper rot settled in that organisation.

A rot that every entrepreneur should guard their companies against the cost of all their corporate policies.

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Let’s talk about entrepreneurial stress

It has been fourteen days since VG Siddhartha took his life. In that time, the entrepreneurial ecosystem has heard arguments from several vantage points to understand the cause of the stress that led to his untimely demise. It is stomach-churning and thought-provoking stuff.

Various arguments attempted to place the cause of VG’s entrepreneurial distress onto a multitude of issues. His close political affiliations, the stress that different business bailouts had put on his balance sheet and even his battles with the income tax department. His balance sheet was funded using debt and private equity; therefore, the private equity guys were to blame as well. However, to place the blame on any one person or phenomenon is to oversimplify a very complex issue i.e., the effects of entrepreneurial stress. 

The one silver lining of this somber episode is that it has got us all talking about entrepreneurial stress. It is a real thing, and there is an excellent chance that an entrepreneur close to you is under this stress right now. Yes, even the most successful ones.

In the Indian ecosystem, a successful start-up founder is treated as a demi-god. The media can quickly relate that entrepreneur into a Tony Stark-type invincible personality – capable of resolving any situation and turning almost anything they touch into gold. The price of this success is steep because the lens of failure is brutal. Ask any of the high-flying entrepreneurs that witness a reversal of fate – the fall from grace can be cruel and lonely. 

The truth is that an entrepreneur undergoes the same level of stress as that of a high-performance athlete. Another reality is that this stress will not vanish. 

The first step to dealing with entrepreneurial stress is to admit its existence. This step is most difficult because it hacks away the cloak of invincibility that entrepreneurs take painstaking effort to build. However, unless we admit that this stress exists, we cannot act on its causes. Ray Zinn wrote a great post on Stress and the Entrepreneur that delves deeper into this.

The next step is to identify the factors causing stress. There are internal factors that the entrepreneur can control and external ones that they cannot. It could be the nature of the business (like running a stockbroking platform), an environmental factor (like the transit time from home to office) or a personality trait (like procrastination and putting off decisions). The factors that can be addressed, should be acted on immediately and earnestly. The factors that cannot be addressed can be overcome through several methods, which high-performance entrepreneurs utilize to channelize their stress positively.

Lastly, once the stress factors have been identified and dealt with, an entrepreneur needs to build a core group of people to fall back on. The people invited to this core (aka inner circle) play a critical role, and they need to be educated on the things not to do.  

This post is one of the toughest blogs I have written because I have had my personal experiences with entrepreneurial stress, which kept clouding my arguments. I kept reverting to the times in my career when I stared from the cliff of despair into the depths of failure. I know today what I did not back then. Even then, I sometimes find myself feeling overwhelmed, overworked, and slightly burnt out. It usually shows up with the burning sensation in my eyes, persistent pain in my back and a marked drop in my physical stamina. 

Initially, I did not know that it was stress. When I could self-diagnose, I took a short vacation, reduced my meetings load or delegated more. The awareness helped with resolution. However, the VG Siddhartha episode has awakened me to change my stance from a reactive one to a proactive one.

So should you.

The fastest path to the CEO chair is very different than what you might believe!

The Fastest Path(s)

Last week I concluded the appraisals for 2019 as well as inducting two analysts into our team at Artha Venture Fund. I attempt to have a conversation with each of the new inductees, and one of the questions I ask them is where they see themselves in the next five years. Most of them have plans on doing an MBA or becoming a manager, but very few have plans to become entrepreneurs.

Therefore when I do their appraisal, I ask them the same question once again, and it isn’t surprising that most of them have had a shift in their five-year goals. Invariably they would like to be in some entrepreneurial position whether that was in a start, proprietorship, NGO or as a fund manager. I hold the entrepreneurial energy that flows within the walls of our office responsible for this shift, and I am confident that I am the one responsible for dropping cans of fuel to flame any evidence of an entrepreneurial spark.

While I have recalibrated the goals for many team members, I have found that like the entrepreneurs that I have met, my team holds misconceptions about the path one should take to becoming a CEO/Founder. I could harp on my own experiences as a case study for them to follow, but it was a pleasant surprise to learn that the team of Nicole Wong, Kim Powell, and Elena Botelho were conducting a study that I could share!

In a ten year study, the trio assembled data on 17,000 C-Suite executive assessments, studying over 2,600 of them in-depth. They wanted to analyze who gets to the top and how and they went onto publish a book based on their findings called, The CEO Next Door.

Their study (aptly called the CEO Genome project) took a close look at the career paths of individuals that they have (once again) aptly called, CEO-sprinters. Their study discovered that on average, it took 24 years from the date of joining their first job to become a CEO. Therefore CEO-sprinters are those individuals that got the CEO title before 24 years.

Some of the data sharing from the study are thought-provoking:

  • 24% of the CEOs had an elite-MBA
  • 7% graduated from an Ivy League school
  • 8% did not complete college
  • 45% had had a significant career blow-up

The study concluded that the CEO-sprinters had three types of career catapults that got them to the CEO chair early viz:

  • Go Small to Go Big
  • Make a Big Leap
  • Inherit a Big Mess

Understanding these career catapults and experiencing them is crucial. Their importance is inferred by the fact that:

  • 97% of the CEO-sprinters had had at least 1 of those experiences
  • ~50% had had at least 2

I will review the book in a future post, but until then you can learn about the career catapults as well as other findings from the CEO-genome project at   

I concur with the findings of the CEO Genome project, and it has once again confirmed what my mentor & ex-boss used to ingrain into each leader that was led by him

The people that solve the most problems make the most money!

Lets start this debate

We are 6 to 15 months away from getting our forefinger inked for having voted for a new Member of Parliament, which will then decide the India’s next Prime Minister. Therefore, there is no better time than now to initiate the debate of what our issues are, the issues of the Lok Sabha and what kind of candidate we need to represent us. There many debates that have defended or destroyed the current government’s handling of our country, its economy and social fabric. However, these polarised debates have not helped in drawing up a resolution, which can be attributed to the style of debating where people are yelling like barbarians at the top of their lungs and embarrassing themselves in front of the entire nation.

I found a fresh new style of questioning and debating in the YouTube video below wherein Kunal Kamra engaged the BJP Youth Wing Vice President, Madhukeshwar Desai in a debate about what he as stands for, what his party stands for and most importantly what they both do not stand for. As a fan of stand-up comedy and Kunal Kamra I found that this video had the perfect balance with a little bit of everything i.e. comedy, diplomacy, maturity, uncomfortable questions and some leg pulling.

I want to engage in a debate to take our country forward and this is how I would love to do it.

22/2018

Uber Goes Free For This Week. A few Thoughts.

Uber is free for you if you pay via the Uber wallet (T&C : 5 FREE rides up to Rs. 300 per ride).

This is ofcourse a great way to increase wallet usage (something which Ola has cracked very well), though such ‘predatory pricing’ activities are bound to attract wrath from the auto and taxi industry.

From an earlier comment by Anirudh Damani (Managing Partner at Artha Venture Partners) :

My family is an investor into a taxi booking company so let me be clear that we follow this space closely and we may or may not see higher values for the investment but what I have seen in this space in the last 6 months is disrupting the lives of many taxi drivers and fleet owners.

Here are the major issues I see:

1. These cab companies are selling below cost… this is obvious when you take account of the recent strikes that hordes of drivers of the taxi-booking companies went on strike as they were out of fuel! The get the subsidized amount from the customer which is not enough to put fuel into the car and the “credit” or difference comes a week later. Are they supposed to physically push the car until then?

See we invested into this space as taxi booking makes things easier for the riders and gives incremental revenue to the driver which they didnt have earlier. It is a pure win-win and net positive for society.

“We will organize this unorganized market” – That is what the pitches used to say..

But right now, we have companies that are selling at unsustainable prices which will drive out all small players and leave the industry in the hands of a few.. this is exactly the opposite of what should be achieved.

This era of free money will come to an end.. and we will be left poorer as a society especially the cab driver who right now is making spending decisions and investment decisions that he/she will not be able to complete.

Isn’t this what happened in the housing boom with free money and no controls? Will we ever learn?

2. Rules are being flouted by unlicensed players that have scant regard for any of the laws in the country… what is very interesting (and sickening) is that it is our own local companies that are flouting the laws relating to taxation, KYC, labour, etc.

In the name of adding supply some of them are paying off taxi drivers through pre-paid cards that are registered in the name of the company and not in the name of the user – is this what we want to call “fair” competition? Is this even legal?

When foreign money is being doled out without KYC and without any trace on the money.. what stops that from being used for means that are anti-social?

What happens when the ED. IT, FEMA, FERA, EOW, Service Tax authorities catch hold of these erring companies and shut the show?

What if it is too late by then?

The show is on right now.. and it’s all beautiful.

Once the song stops.. you will see that we have destroyed whatever semblance of sanity there was in this space.”

Good for consumers. But what about the industry?

Are parts becoming greater than the sum? Think about it while you enjoy the ride.

(Article published by NextBigWhat on 27/11/2014, containing excerpts from a comment I left on a previously published article on the same platform titled The Big Battle Between Funded Taxi Startups And The Rest.)

An Example of Horrible Pricing Strategy – Blackberry India’s BB10 Pricing

I must start this article by stating that I have been using a Blackberry for the past 10 years and I will continue to use one for the foreseeable future. It’s only using a Blackberry that I can punch out a 3 page email in under 5 minutes flat and I still receive emails on my Blackberry faster than any of my friends and while my friends may make fun of my “oh-so-yesterday” device – I am not one to jump ship on someone so quickly.
So while I may not be in the market for a new device as of now, I eagerly look forward to new Blackberry devices, hoping, praying and wishing that they finally get their marketing plans right and give the market what it really wants. The company has been doing very well under interim CEO, John Chen, by focusing its efforts on the enterprise market, promoting its QNX platform and launching new phones in partnership with Foxconn at multiple price points in the overcrowded smartphone market as it looks at selling its devices to the 85 million strong community of BBM users to buy its phones (BBM is available cross platform now)
These changes have definitely helped the company’s fortunes as the struggling smartphone pioneer delivering Q1 results that have surprised the market and the stock rallied 34 percent in the month of June 2014. The company launched a low cost device in Indonesia call the Blackberry Z3 (which is now getting available in all markets) and has announced a partnership with Amazon that will bring the Amazon’s appstore to Blackberry and allow the enterprise device maker to focus on regaining leadership in its core market.

 

Blackberry’s India strategy for the pricing of its devices is bewildering and confusing though. First they launched the Z10 device in 2012 at the same price-point as an IPhone which almost guaranteed the failure of the devices launch. Later on, it priced the Q10 and Z30 phones at even higher price points (oddly the Z30 was priced at almost the same price as the Z10 when it was launched) which only led to a faster exodus of Blackberry’s customers to rival phone makers. However, the Z3 was going to be its game changer, I likened it to the Blackberry Curve that was an instant hit with young professionals and teenagers and expected Blackberry to launch that phone at the same price point it had launched this phone in Indonesia of under $200.

 

However, whoever did the research and decided the price point for this device be put at Rs 15,990 made a grave and fatal mistake. For starters Z3 is priced Rs. 1000 less than the Z10 device and Rs. 9,000 less than the Z30 device. A comparison between all 3 devices is available here and it is clear that the Z3 is going to cater to the mid to low segment of the smartphone market and with that assessment I agree with Anupam Saxena of Times of India and Nandagopal Rajan of Indian Express who have given the phone good reviews but complain about the phone being priced out of the market.

 

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The Z3 at Rs 12,000 would have offered a very compelling and competitive case for those looking for low cost Android phones in a price sensitive market like India. Alas, Blackberry India has made another pricing and positioning error and this is extremely disappointing for a Blackberry enthusiast like myself. I request BlackBerry’s team to convene a meeting with its sales and marketing team (separately and then jointly later) and find out the acceptance of Rs. 15,990 for the Z3 in the market – they will be surprised and will be forced to react faster than they ever have before.