The Invaluable role of “Chief Business Obstructers” in the modern corporate world

Darwins theory of evolution in its simplistic form says ‘The fittest survive and they fight to compete, survive and procreate’

Societies have evolved over generations where economic progression, education and character have all moved in a synchronous manner. Some of the most developed economies like the US, UK and France have had their fair share of tribulations such as wars, diseases etc but have demonstrated that they maintained their financial, military and intellectual hegemony from a global perspective.

Societies in the first world countries prided themselves with superiority and there was a race among these nations to establish themselves as a leader in one thing or the other. Inventions (technological, financial and medical) of every form happened in the western world.

So why did India get left behind so miserably, when evolution of homo-sapiens happened almost at the same rate/manner across the globe.

The answer lies in one word “Corrupted Greedy Character”

But this didn’t happen by design – it was the natural evolution of a nation where its large population zealously procreated and grew roughly 4 times from 350 mill to 1.3 billion in just 65 years.

And Darwin’s to blame majorly for the present character of this nation. Or at least his theory explains this at best.

Lets reflect objectively on the causal factors.

India can primarily be divided into 2 kinds of demographics Rural-Agrarian and Urban-Corporate.

The rural-agrarian have relied on limited means, producing and consuming and storing for the proverbial winters/rainy days – Simple.

The urban-corporate are living in small over populated cities with limited resources and infinite greed among themselves to survive, grow, hoard and procreate. Another phenomenon happened in the Indian sub-continent in the last 50 years. Indians were primarily fighting floods, droughts and starvation and suppression in the last 300 years, but the last 50 were marked by rapid economic developments, lesser vagaries of nature, economic development led by rapid and almost alarming shift from agrarian to services based economy and a large part of urban population having marginally more than required.

Yet the starvation gene (let’s call it the gene X) still continued to exist and despite the rapid progression, in last 50 years, on all fronts namely economic, medical, food, transportation and habitation, the gene X that encourages to hoard, be greedy and survive at all costs and mostly at other’s expense, persisted and didn’t mutate at the same fast rate as the economic development of this sub-continent.

That’s why Indians over eat and eat till they are proverbially full (read bursting after a meal). They are generally a dissatisfied lot wanting more than what they deserve or can actually earn.  And that explains why inspite of being a rather superior nation on many fronts, this subcontinent still behaves primitive, back stabs, in-fights on trivialities and sadly the educated in the so called corporate world spend majority of the time pulling the other one and the surrounding ones down because of a misplaced sense of depravation and insecurity that purports corruption, greed and above all ‘obstruction’.

And that catalyses the breeding of ‘Chief Obstruction Officers” in the corporate world too. Fair warning pls – no COO should feel attacked – we could even call these assets - Chief Business Obstructers or Chief Financial Obstructers. They are all the same. For brevity lets just stick to CBO’s

C N Parkinson wrote a powerful essay in 1955 that pretty much defined the expansion of bureaucracies in an organisation and how work aligns and expands itself according to people available for its completion and organisations are perpetually insecure. Every insecure company necessarily wants to have infinite multiple layers of inefficient CBOs to keep an alleged check and balance.

But lets talk of the role that these CBOs play in the fate of organisations.

These people have never actually handled a business in its true sense. (the corner shop paanwalas are better businessmen because they invest their own money and have a skin in the game). CBOs pretend to be confident, very knowledgeable, stretched on the chair as if on a hammock (during an official meetings – but that’s a body language that hides inferiority in the garb of stretched posture), their condescendence and pretentiousness would put thought leaders such as Kotler and Prahlad to shame

Nothing amuses me more than seeing people from disparate backgrounds, accidentally landing themselves in position of authority, pretending to be Prahalad’s reincarnation, aspiring to make a mark without an iota of responsibility, assuming authority because no one questions, pretending to have a connection with GOD (when God least cares), and then start preaching on topics and industries – of which they have no knowledge.

We call them “Chief Business Obstructers”

 

A friend was sharing his personal experience when he used to run a business that grew 5-6 times in 4-5 years. Customers were happy, colleagues were thrilled, profits were good. So much so – the growth rates encouraged his company to start thinking IPO. Nothing gives an executive more joy when peers in the industry start talking about small businesses that become a formidable force and everyone starts talking of these small businesses as the next big thing.

 

Enter – “The Chief Business Obstructor”

Corporate world is funny – everyone pretends to abide by Thomas Bertman’s adage “don’t fix it – if it ain’t broken” yet no one practices it indeed. On the contrary system gives authority to incompetent people who know nothing about a business and these wise men try and fix every single thing that’s not broken - till the business is on its  knees, is on ventilator support and eventually breaks down.

Corporate world is replete with examples of excellent businesses that tried to do a lot when nothing was required to be done and businesses and leaders who did nothing when a surgical intervention and action was required.

But there are clear and distinct signs that leave a trail of evidence, sometimes discovered much later (similar to the tail effect of a comet) when its too late, that sow the seeds of demise of well run, well managed, perfectly fine companies irrespective of their size.

I spoke to about 9 different C and D level executives and have endeavoured to summarise below the signs we must look out for – if we care for the longevity of the companies.

1. When setting up businesses do not allow the old loyalists from other divisions (who have no freaking clue of the new businesses) to opine.
2. Keep things simple – Product , Market, Marketing, Sale, Customer, Customer Service. This is all that matters. Anything beyond that is all farce.
3. Always almost make your projections keeping a buffer for difficult and unexpected times. Microsoft excel is a wh@#e – you can titillate it to whatever extent. It almost always fakes in real life.
4. Every executive who leverages the company, must be locked in (by hook or crook) into company’s employment for the length of the debt. Else the promoter will be left with the hot potato at the end while the executive would have taken his/her hefty bonuses and digested. Does this sound like Fuld?
5. Executives who fix up meetings 4 times a week on disparately different subjects – Weekly updates, strategy for the week, strategy for the month, long term strategy probably need to be fired immediately because they have nothing better to do and are only trying to establish their relevance at the cost of some other business and someone else’s time.
6. There is a trend to ask for weekly monthly and yearly cash flows week after week after week as if the flow of cash is the living account of the flow of bile of the Chief Business Obstructer.
7. To establish their own importance, some CBOs suffocate the businesses of cash to an extent that their artificial importance gets established as if they are The Fed and 90% of the time of the business is spent in making excel sheets or symbolically accounting for the CBO s bile.
8. When reviewers start commenting on everything that they don’t have info about and keep showing the business and its CEO in questionable light just to justify ones’s 8 figure salary and pretend to be custodians of the business – pls definitely get wary.
9. CBOs ensure that the business doesn’t have enough money to even pay its salaries while they are happily gloating in the warmth of their annual bonuses and planning trips across the globe.
10. CBOs unleash a volley of 20 something’s analysts, seeking data from companies with the sole purpose of making themselves and CBO’s look like saviors but in reality setting a rot of mission fatigue within the organisation.
11. Pretend to be owning the business at someone else’s expense, without investing a penny and feigning ignorance when shit hits the roof and finding someone else to blame.

The few reasons why a handful of businesses have survived over ages are – when..

1. Owners and CEOs have trusted a handful of performing executives over long periods of time.
2. Businesses aren’t judged week on week but are judged year on year and brand-on-brand and reputation-on-reputation and happiness-on-happiness (teams and customers)
3. Owners don’t allow fraudulent people with all authority and no responsibility to exist in the system without any measurable accountability.
4. Owners call-out the fakery by converting the hefty bonuses into equity and making these well-wishers participate in the success/failure of the company.
5. The fundamentals of running a business are kept simple where cash is king and debt is death.
6. Businesses aren’t enamored by the western style of cash flow discounting and valuing the future elusive cash into present ongoing party.
7. HBR in a series of popular blogs have lauded the Indian baniya style of doing business and has given an infinite importance to collaborative culture and care for all.
8. Businesses are managed with lean teams that are empowered and productive and not meeting 10 times a week to discuss strategy when none really exists. Take for instance Berkshire Hathway's office in Omaha that manages 510 Billion in marcap of businesses with a handful of 25 employees.
9. And lastly….
10. Rather than reinventing the wheel of management styles – unconditionally back the performers, remove the flab and rapidly weed out the fakers.

Manu also writes for HuffPost

Infosys Saga - Who is Omkar Goswami by the way!!

Mr. N R Narayana Murthy has been under some criticism for a while for having raised some questions that remain unanswered by the erstwhile CEO Vishal Sikka or the present Infosys Board, ‘Founders Go Away – leave the company alone’ has been a rhetoric that’s been echoing in the present board rooms of Infosys.

So when I read a scathing attack by Omkar Goswami in an open letter to Mr. Murthy – I wondered , By jove He must be one hell of a fellow to make such an advice and would have founded bigger better companies than Mr. Murthy. Well yes he has been on the board of many of them but I don’t think Omkar Goswami has to his credit an iota of what Mr. Murthy has achieved in his lifetime.

When I wrote about Sikka on 10^th Jan 2017 in Huff post, I thought I had crossed a bit of a line in making some assumptions. But it’s a great feeling to be proved right, now and then, and that too in public domain.

Now back to Omkar Goswami

Google search threw up a Wikipediapage on Omkar Goswami and yes he is an economist by education, he might be a carrying a chip on his shoulder for being from Oxford, Masters in Economics, and of course a doctorate in philosophy by writing a dissertation on Jute economics which in today’s parlance is seemingly irrelevant on the face of it.

I dug deeper and the sum total of his life resume can be written as follows….

…A well educated economist, academician, and a columnist of repute with a doctorate on a defunct topic in today’s world.

Well I hadn’t ever heard of Omkar Goswami till 2 days ago but let me ask him a few questions since the season of open letters and editorials… (a’la Infosys) is in full spring.

Dear Omkar Goswami…….

1. Have You managed a P&L ‘ever’ in Your life
2. Have You ever founded a company
3. Have you ever been regarded a father of any industry
4. Have You ever held a responsibility where an ocean of investors have remained vested on your credibility
5. Have you ever taken a decision that has created immense value for yourself or for any company and its shareholders
6. Have You set a precedent of transparency and compliance, such as, quarterly reporting and guidance, far before it became a statutory norm for listed companies.
7. Do you have any claim to fame of being beyond a consultant? (a consultant is popularly an analyst/advisor who has all the opinion and authority in the world without any direct responsibility)
8. Does anyone know you or has respected you as an epitome of corporate governance in any circle whatsoever.   And Lastly.....
9. Have You been listed as one of the 12 greatest in anything by anyone?

Mr. Omkar Goswami – if the answer to any of the above was Yes – I would have heard of you for sure.

And if the same questions were to be put to Mr. Murthy, the answer to each one would be a resounding Yes.

It surprises me that people who have the skin in the game and have founded companies and nurtured these for a major part of their life and have earned and commanded (through their deeds, hard work and thought leadership) respect and adulation are being questioned by people who have no skin in the game. Most of the present board members of Infosys are retired professionals / executives who are now playing an extended innings (I am sure) for some remuneration.

If the companies are to survive beyond a global average of 33-35 years, decision makers and opinionists must have a skin in the game. Else it takes just a few quarters of bad decision-making to bring down companies and takes decades to build back the same.

Mr. Murthy-, the world (India and beyond) has looked upto your values and have endeavoured to imbibe within itself, what you have preached and practiced all your life.

So what if you asked a few pertinent questions or a few documents of a deal to be made public or raised a doubt on the remuneration of someone who has little evidence of achievement in Your opinion.

You founded Infosys, It’s is in your right to do so and I am sure millions along-with me stand with you in your ideology and in spirit.

Manu also writes on Huffpost

The three blunders by Tim Cook at Apple

My sister thinks that I am almost primitive for not having switched to an Iphone and my reluctance to make this switch surprised her even more when she recently brought an IPhone 7 for all family members while visiting us from the US of A.

Till about a year back I was terribly happy with a Blackberry (BB) till most of the apps that provide daily convenience decided to stop providing BB support and life started becoming difficult. And I switched to android. As I mentioned in one of my posts that went viral, BB lost the plot when it failed to take a few significant decisions in its product lifecycle. Even while Apple is likely to be the first company ever to achieve a US$ 1Tr market cap, its fate might be similar to BB if it doesn’t change course.

It’s a given that till recently Apple used to make the most beautiful phones and laptops on the planet and yet a statistic that I came across pleasantly surprised me. Give or take, Apple has less than 20% market share of the smartphone industry and pockets 90% of the entire profits of the smartphones sold across the planet.

And that’s why the smartness and iconic status of Apple in every aspect makes it the most talked about brand in the world.

But

Product efficiency must be far better than the rest of the competition.

The only people that I have ever seen struggling with a repertoire of a battery packs and wires looking like nooses around the necks are users of Iphones. Its hard to imagine that Apple hasn’t been able to get its battery right. And on top of that they aren’t even apologetic about it. If someone was to have a long working day starting at 0500 and going thru midnight, there is no way in hell that Apple would last beyond noon. It’s a shame to see Apple Iphone users nervously struggling with chords and chargers. Apple must do something about its batteries or its in trouble.

Further to substantiate my belief I used a US$200 Chinese phone along-with an Iphone 7 for a fortnight and was pleasantly surprised with the Chinese brand for its interface, battery and response. 1/6^th the cost and a far superior efficiency. Apple phones at approx. US$1000 a piece do not provide anything that a plethora of phones at 1/5^th the cost provide smilingly and efficiently.

Position of supremacy can neither be taken for granted nor can it last forever.

A brand like Apple must consolidate its present position and try and capture a much larger market share. Customer is conscious and no brand in this ever connected and efficient world can charge a 4X premium for a small incremental beauty / efficiency of a product.

The saga of success that started in early 2000’s when the ipods took over the world must continue into a new product or invention. For how long can apple continue to modulate the same iphones in their shape and size and – isn’t this akin to old wine in new well packaged bottle every few quarters.

Product evolution in line with customer’s demand / desire.

Every other phone comes with a 2 sim slot that is really the most practical functionality to have for people who travel and are sometimes in need of alternate numbers. Apple has conveniently chosen to avoid providing this most desired functionality. If India and China with multiple GSM service providers at multiple radio frequencies, are to be Apple’s next serious countries of growth, Apple must start providing 2 sim phones sooner rather than later.

People generally prefer to keep work and personal numbers separate and a 2 sim fone at a starting point costs as little as US$40, its terribly surprising that Apple hasn’t thought of it as its top priority while brouhaha’ing’ about the India and China potential.

Greed is good but put a stop somewhere.

As Gordon Gekko says – Greed is good and Apple has brilliantly realised its greed to an extent that its cash reserves of US$250B are more than the GDP of many countries in the world, but all of it can quickly disappear if the most powerful engine of this growth feels short changed – and that engine is The Customer.

Microsoft strategically and conveniently allowed piracy of Windows in all second and third world countries for the longest period of time but captured a significant market share. The only sustainable ecosystem of programs and softwares across the planet is aligned to Windows. The world today is reluctant to switch off from Windows even if there are better and cheaper alternatives available. Apple seems to be losing this plot somehow.

Forget the profits and the success and the iconic status of Apple as a company – but with just 20%market share at 5-6 times the price of similar products, all it would take is a few quarters for this castle to come crashing down if the customer – who is king – realizes, what a ‘Charlie’ - Apple is making out of them.

Whatsapp wouldn’t have existed today if Blackberry had opened its BBMessenger as an open source free app just a few quarters before it actually did. This happened to Blackberry for its sluggishness in evolution – this could well happen to Apple.

Follow Manu on Twitter @manurishiguptha

What Infosys’s Vishal Sikka’s tenure teaches us about ‘ Strategy ’

Recently Wipro’s Azim Premji and Infosys’s Vishal Sikka made joint statements about the stresses and tough times that lie ahead in the Indian IT sector and how the global factors have caused immense uncertainty – I agreed, for its been 2 years that I have been - through this blog, making a case that greed, unsound economic decisions and self-fulfilling political pursuits by nations and central banks have pushed the world to a brink of dangerous unanticipated consequences and that the present prices of ‘pretty much’ all asset classes are unsustainable.

But this piece is about strategy. I read this word so often that I am now almost sick of it. Speak to an over enthused student at a business school – he wants to excel in strategy and make a career out of it, speak to a new CEO – he would talk of a 10 year strategy and vision and make the incumbent employees feel scummish for their lack of strategy and vision, speak to a consultant (highly paid youngster at probably the big four with all authority and no responsibility) and he would regurgitate so much on strategy through his 100 page presentation that the customer would really start cursing the historical past, when the consultant wasn’t on board.

Well strategy is fashionable, it sounds great – but in reality its bullshit. As Peter Drucker says Culture eats strategy for breakfast everyday

200 years ago when nations orchestrated wars to take over other nations and land masses across the oceans, strategy made sense. A strategy once made could remain relevant for 50 years as letters and information could be sent/received over sea/horses at most twice a year. Officers of invading nations had orders to execute a decision and the same could be reviewed only after a few years. Results to judge successes or failures was possible – at best – over a decade.

Today all it takes is a tweet by Trump to make the price of fortune 100 company crash or a claim by wikileaks to make Hillary lose a winning US presidential election or a unfounded misinformation that encourages a nation to invade another and create a world havoc that is likely to have a century long ramification.

Disclaimer : Now I don’t know who Vishal Sikka is or what he stands for or what he brings to the table and I have nothing against him. He is just a case in point because I remember him as a non-promoter Indian to get the highest salary in India, to get an annual compensation of about 6 mill USD besides all the stock options. But I read 3 newspapers everyday to have a fairly good memory and to form an opinion.

When Sikka joined Infosys somewhere in June 2014 as the first non-promoter CEO, he was the next big thing in India. He talked of strategy and he talked of vision and the world took notice. The stock price of Infosys soared and he became the poster boy. At the time of his joining, the annual revenues of Infosys were about 6.9 billion USD and he talked of a six year 2020 vision of 20 billion in revenues. ie a approx. 2 billion increase in revenues each year. And he maybe got more bonus. Many of the rockstar executives who built Infosys over last 2 decades, allegedly quit out of frustration.

This reminds me of the despicable Jack Welch who made a fortune for himself but made the most ruthless organisation by firing 5-10% of workforce every year. As Simon Sinek says, companies that sacrifice their people for numbers rather than numbers for people aren’t built to last.

So as time progressed Sikka’s rhetoric of his vision became louder and the performance became quiter at about 7.9 billion USD in FY 2016 but he still maintained the gusto of his rhetoric.

The last Q3 FY17 results of Infosys are due on Jan 13^th 2017 (oops that’s a Friday) and Sikka already warns of tough times ahead and by the way all of it is the fault of BREXIT and Trump.

And going by the HY (half year) run rate of FY17 Infosys will achieve about 9.5 billion USD in annual sales. With three years to go for 2020 – a 3 billion USD per annum increase.

Whats the point:

Its not Sikka’s fault. He has no role to play. The multitude of global factors and externalities are so diverse that any CEO or alleged strategist who talks of a 10 year or a 5 year strategy is only fooling himself or the board.

Its good to have a general aspiration (call it vision) for next 5-10 years. But having a 5/10 year strategy and a promise can help you get a bonus but all that matters is the next few quarters.

Companies are wasting too much time on vision and strategy not realising that merely a tweet, a simple geo-political externality or an event on which no one has a control can change the dynamics of our aspirations and strategy overnight.

Boards must realise and encourage the following:

1. Growth is important – and imperative. Don’t put so much pressure on CEOs that they are forced to make specious commitments.
2. Preserve cash – When a Brexit or a trump hits you – no one knows. Cash is king and cash is the one that will help you survive in tough times.
3. Leveraging created on the assumption of ‘future growth of present revenue run rates’ (sounds almost as exotic as CDO’s of 2007 isnt it) is a sure shot recipe of disaster.
4. The Baniya style of business has stood a test of time over 200 years, till Goldman arrived on the scene and changed the rules of the game. Live within your means and borrow what you can pay from present income – not future income.
5. Every decision maker must have a skin in the game. Convert decision making executive’s present bonus and compensation into future equity if you want the organisations to survive.
6. Conservatism isn’t a bane, it’s a virtue. For fools are full of confidence and wise are always in a state of doubt.
7. Every present expense must pay for itself – strategic decisions taken in present for future issues without having a control on future are likely to be disastrous and not reflective of a sense of ownership or good leadership.
8. Stop expecting month on month or quarter on quarter. Allow your CEO’s to work in peace and keep a quiet watchful eye. Fire them if you don’t like them but don’t create noise and disturb them every single day.
9. In an ever connected highly efficient world make a 3/6 month strategy – if at all. Anything more than that is gas.
10. Keep a watchful eye on people talking of 300 years of vision and balance sheet (surprisingly same people couldn't retain their CEO for more than one). Anyone reading this will probably be dead in less than 40 years and anyone talking of 300 years probably has no plan at all.

And lastly for GOD’s sake – stop talking about strategy and start working on culture.

Manu also writes in Huffington Post

Martians, Modi and A Challenge for The PM

For the fear of being left behind I thought it imperative to opine on my Prime Minister for whom I voted and also wanted to write a non economic, easily comprehensible, data-free article that anyone can understand especially my international audience.

I haven’t been as amused lately as I am now, looking at the various marketing machineries for Modi who has been creating an aura of invincibility and humbling the achievements of Mangalyaan in comparison of what the Ironman has achieved in the last 1 year.

Let’s ignore the following few things in the credit of Modi and imagine that aliens from Mars are responsible for these and not the government:

• Rate of increase of farmer suicides
• Slowdown in industrial production
• Lack of tolerance towards the Christian and Muslim communities that has exacerbated in the last 1 year
• Real Interest rates still high because of a high spread retained by the banks and government having no real control over anything
• Unemployment rates going up by a few hundred basis points
• And not a single big infrastructure project having taken off the ground with hundreds of billions of dollars stuck in stalled projects

Now let’s safely assume that a few of these amazing global tailwinds were all because of Modi’s charm that he spread, during his global sojourns:

• Crude oil prices dropping from $110 to $55
• Inflation is well within the comfort levels of the Central Bank
• Dollar inflows into India that took our forex reserves to USD 350 Billion
• Easing of tensions with Iran thereby making the Middle East a bit more stable.

While the captains of the industry aren’t getting enough opportunity to praise Modi for what he has done for the country or its economy, since no one dare displease him, my report card for my Prime Minister is as follows.

I am a common man – very middle class –  simple things matter to me.

Each day, as I read about the plan for 100 smart cities in India, I only look towards the skies and musingly ask God – "Are you kidding me?!".

I keep looking for the ‘acchhe din’ or good days that were to come with Modi.

So much talk about a corruption free country. But just recently a policeman in Bangalore fined me in cash and even gave me a discount upon negotiation. Was fined because I went on the wrong side of the road. A pertinent point to be mentioned here - Bangalore is the only city where, on a few roads, one must drive on the right side instead of left and those new to the city are supposed to know this by birth!

It's all a big sham!

Governments have only marginal utility.

For a commoner, it's like selecting an outsourced security guard for your premises at minimum wages with minimum expectations and hoping that when one day the real need arises – this fellow isn’t sleeping.  Otherwise most of the time – he's just half dead - although he's still there.

While a lot of columnists and senior journalists are busy writing the government’s scorecard, discussing his performance in incomprehensible semantics, I want to give Modi a simple task –

India approximately has an area of 3.2 million sq kilometres. Mr. Modi, please pick up any 100 only hundred sq kilometre (.03%) area of your choice anywhere across the length or the breadth of this country and convert it into a place where:

1. An hour of rain doesn’t inundate the area and choke it
2. Where an innocent pedestrian can walk without tripping over
3. Where a person on a wheelchair can roam about without cursing every single day of his existence
4. Where a tourist can drag his suitcase without a hassle, between roads and footpaths
5. Where traffic lights work and roads have adequate lane markers
6. Where a pedestrian has more respect (like everywhere else in the world) than the speed defying typical Indian driver on wheels
7. Where a lady can walk without feeling uneasy or being visually stripped naked by passerbys
8. Where someone who must be punished, is punished without blaming the 10 million pending cases in Indian judicial system 

Just maintain it for one year for the world and your voter to see.

And then we will do the swachh bharat and talk of 100 smart cities – please.

In the meanwhile it would help to spend some time in your country rather than making innumerable  trips abroad unless you want to cover it all before the oil prices start going up.

You are a good man Mr. Modi – and I think you've got the vision right. But vision must be followed by strategy, which must be followed by execution and metrics – and my Report Card says – you still have a very very long way to go. In the reportcard, at best, you get a Minus B.

BlackBerry And The Art Of Becoming Irrelevant in the Business World

Around the time when Mark Zuckerberg was floating around in the dorms of Kirkland House figuring out Facebook (FB) or allegedly plagiarising the Winklevoss brothers' ideas, the market cap of BlackBerry (BB) was about US$64 billion.

Fast forward to 2015, the market cap of FB is at about US$225 billion while BB is less than US$6 billion.

There was a time when owning a BB was associated with busy high-level corporate executives who always felt the need to be connected and have uninterrupted access to their e-mails while on the move. The BB Messenger also known as BBM -- an Internet-based instant messenger -- was a really clever innovation, a sort of wonder that allowed people to remain connected without paying exorbitant prices on GSM texts.

The BB was seen as a well-guarded bastion when it came to security. The best of the hackers around the world could not break the encryption codes of BB. Some pockets of US government including the White House still completely rely on BB since there isn't a platform as secure as this. BB owns some 44,000 patents that form the bedrock of its intellectual property.

But when Android was taking over and becoming a preferred platform for mobile software, BB couldn't see the train coming head on and made three fundamental mistakes that have rendered it irrelevant forever.

These mistakes are similar to those that many companies make in today's business scenario.

1. Overconfidence in one's ideas and existing business models

The clichéd saying "change is the biggest constant" is more conversational than truly understood by the majority. Polaroid, Kodak, Xerox have all become irrelevant and BB had ample opportunity and intellectual capital to correct its course at the right time. But hubris isn't only personal and human, it's organisational as well. And hubris can do you in. Resistance to change and resistance to new ideas and new paradigms can be suicidal.

BB was an amazingly evolved tech company and was at the zenith of its popularity. But its pride and its belief in its supremacy didn't allow it to evolve and open the platform for creation of apps and allow developers to use that platform for creativity; Google's Android did. When BB's market cap was about US$64 billion, Google's was about US$35 billion USD

On most occasions I disagree with Michael Porter but here I vehemently agree. BB had created an amazing barrier to new entrant and it just scuttled it away.

2. Delay to act in the face of an approaching train

Imagine you get stuck on the tracks of an oncoming train while you are with a group of people who are only going to follow you and listen to you (read CEO). You are supposed to shout at the top of your

voice and get your followers (team members) out of harm's way. And yes you have to

scream on the top of your voice. You cannot say,Excuse me - there appears to be a moving object that vaguely looks like a speeding train and if I ain't incorrect it is seemingly moving in our direction and for our safety, we must just step aside, please. What you need to say is Get the *&^% out of the way.

Strategy strategy and (oh my God!) strategy. This word has consumed more than 80% of the educated world especially the folks from business schools. And there is less action and more strategy in the corporate world today. Parkinson's Law.

Someone within BB needed to see the onslaught of WhatsApp. By the time BB figured out that their BBM messenger had to be on an open platform, and WhatsApp had to be BB compatible - it was too late. WhatsApp spread like an unstoppable virus and before you could say Jack Robinson, WhatsApp was a 300 million strong community. Jan Koum started WhatsApp as a small initiative to circumvent the inflated GSM texting costs and that became the nemesis for BB.

3. Failing to protect the consumer's interest / pocket

I love the phrase ceteris paribus. All other things remaining constant, the cost to the consumer must be the lowest in an efficient market. You cannot have a product that's pricey, not-so-good looking, expensive to use and still running on technology that's at the end of its product lifecycle.

BB hasn't thought of introducing a dual SIM mobile phone till date. In fact, until they launched their OS10 about 24 months ago, consumers had to subscribe to a BB plan with a fixed minimum monthly cost of Rs 300 (approx US$5) in a country where average revenue per user (ARPU) is Rs 95 or about US$1.5. Frequent travellers, price-conscious consumers figured out the virtues of carrying two SIM cards for various purposes and taking full advantage of various talk-time plans. Samsung with its duos range at the right time of "need lifecycle" launched dual SIM phones and changed the game forever. Almost all manufacturers now make dual SIM phones but Samsung is far, far ahead of the curve and BB still hasn't figured it out.

BB wrote its own obituary way too soon due to inaction or absence of speedy action at the right time.

Don't let that happen to your company.

Manu also writes in Huffington Post

License to Corruption

Research and data can throw rather interesting theories and a recent one by Uma Karmakar, a Harvard Professor and Bryan Bollinger of Fuqua threw up an interesting argument.

Their research drew a correlation that shoppers who brought their own bags to recycle would tend to buy more organic versions of food. One green action led to another. But the same people were most likely to buy ice cream, chips candy bars and cookies. These shoppers weren’t replacing green items with junk. They were just adding junk to the cart.

Uma’s research says:

You do good and you give yourself a cookie

If I behave well in one situation, I give myself license to misbehave in another.

I get a diet coke – I get myself a hamburger.

If I have carried my recyclable bag, I have helped the environment – so I have earned the icecream.

In consumer psychology ‘licensing is the key’

License to indulge or licence to be corrupt

Corrupt?

Corruption isn’t only in financial parlance. Corruption is a simple word that means questionable intent wherein individuals don’t do what they are supposed to do or they do what they aren’t supposed to do.

‘Corruption in my most simplified connotation is diluted intent’

A simplified parallel can be drawn between the research above and over zealous and tom tomming ceos and executives in positions of authority and also between politicians who pretend to be paragons of virtue. And if you look around you there will be ample to locate.

People who are loud and brash and are over confident of their performance and cannot stop tom tomming are the people that boards and top leaders must watch out for. As corporations grow, more than often we would come across executives who are always on the right side of everything, who would always be too good to be true, whose integrity would always be seemingly unquestionable, who would always get loud in tricky situations to create a facade of invincibility. These could be the very people who would have hidden traits of Jeffery Skilling of Enron, Martha Stewart or Carly Fiorina who would put their businesses and its reputation in harm’s way.

Politicians aren’t terribly different either. The most corrupt politicians are the ones who indulge maximum in public service. India has a huge concept of farm and gas subsidies paid by the combination of fiscal deficit and tax payers money. But a fraction reaches the end user and yet the powers that be seldom show a real intent to weed out this structural flaw in public distribution because this money in some form or the other finds its way back into the politicians personal coffer.

The more money is allocated for infrastructure, the more we hear of people vanishing in open gutters during rains in India, the farmer suicides is now a global debate and yet no serious intent has been shown by the polity - for how else, but through corruption, would the elections be financed in India which is really the root cause and forms the bedrock of all corruption.

Bertrand Russel rightly quipped – Fools and fanatics are always so certain of themselves and wiser people so full of doubts.

And next time be on a watch when someone tries to take the recycling of grocery bags to a level of obsession or talks too loud about ones virtues of honesty and righteousness.

Is Life and Commerce - a Casino?

GMAT is a popular exam that most MBA aspirants appear for. And the sample tests available online throw up a very interesting food for thought. If one is just hovering around being an average or just

above average (Joe Bloggs) in academics he/she would score about 550-570 out of a total of 800 ie 65 percentile (approx) if that person were to mark the entire exam randomly as per ones gut, the score would still be still 550-570

This i figured out when i was preparing for my GMAT in 2007. The trick is to achieve 99 percentile.

The business world

MBA to me is seemingly the most irrelevant education one can ever acquire because it makes you aware of your surroundings a bit more than everyone else. The case studies based on thousands of successes and failures over the last 100 years makes you terribly aware of too many things and you lose your chance to take that risk. Because we fail to forget that its an efficient marketplace.

The more i deal with educated and allegedly experienced professionals the more sceptical i get. Analysis analysis and more analysis. The sum total of all monetary risk is as follows. Every fund every source of money could be parked in AAA rated securities (absolute safety), and as businessmen start taking risks and start leveraging the base equity, the returns start rising. (Risk reward ratio – directly proportional)

In India you can easily park money at 11-12% in almost AAA rated securities or bonds and Warren Buffet’s life performance is about 21% CAGR (and i consider him the epitome of financial performance), so put it simply - the entire economic activity on this planet, the entire analysis, the entire risk reward, the entire funding of start-ups, etc etc is to inch from 12 % CAGR to 21% CAGR.

And yet

Statistically only 8-10% companies have survived beyond 33 years of existence

Only 8-10% of start-ups ever make any money

Only 8-10% of return is guaranteed over a long period of time

And in a casino if one analyses the top 4 games that are played 95% of the time, you have a fairly good 8% chance of winning.

If Ambani (india’s leading businessman) had analysed his pro and cons even an iota more, his children would still be filling fuel in the petrol bunks of Yemen. Thank Goodness he didn’t know what IRR was.

If Bill Gates or Jobs had calculated their IRR on their investment what would they be doing today is anyone’s guess.

Life is about the leap of faith and an uncanny and a very scarce ability to go with ones gut to invest/start/embark on the journies of life. After all you only have an 8 % chance over short to medium term and we are all dead in the long term.

The business of life

Life sucks – I know a dear friend who courted for 9 yrs before getting married and the marriage lasted just a little over nine months. And there are people who didn’t see their potential spouses, went thru an arranged married ( 2/3^rd s of the world doesn’t even know what an arranged marriage is) and they have been married for ages some for decades and many I know for over half a century.

Carrying your heart on your sleeve is the best virtue a human being can have. You win some. You lose some. Whether its life, love, casino or business.

Go by your gut and pursue your dreams. If you win you become rich, if you lose you become wiser.

There is no failure in life – only feedback

And life is just one big casino.