Raj Shankar's Blog, page 37

Value Proposition – whose perspective is it written from?

It matters!

I was leading a workshop recently with young entrepreneurs. During the course of developing their value proposition, I kept harping on the question: “Are you really solving an important problem / challenge for your customers?” The entrepreneurs kept asking me to move on to marketing techniques and how they can implement them. I resisted this urge and kept going back to value proposition. They seemed to think that the very reason they are up-and-running as enterprises is because they have identified some value for their customers! But for me, something seemed amiss!

Over the three hours that we spent discussing and rewriting the value proposition statements for all the entrepreneurs and their start-ups, one thing struck me hard – they were all writing their value proposition from the perspective of their offerings (be it products / services). This was not getting anyone other than themselves (even in the class) too excited. So how do we make a customer excited about your product / service? Answer: A good value proposition statement!

So, what is a good value proposition statement? While that requires a series of iterations, the first step is to change the direction of thinking from the perspective of the entrepreneur. The entrepreneur has to start writing the ‘value proposition’ statement from the perspective of the customer. This is too simple but subtle a change that it even requires keen awareness to recognize it.

Most entrepreneurs write value proposition statements from their perspective. It is most often a restatement of the features and benefits. But most customers buy solutions to their problems, not features! Small disconnect in understanding, but leads to large holes in the Income statement.

Think about this! This requires that you re-write value propositions to address problems head-on. In the next post I will detail at least two things that a good value proposition statement should address so that customers can make quick decisions.

Interesting Links This Week: 06-October-2013

Have been travelling and managed to read a lot more on my phone than on the laptop. Here are some which really got me interested and kept me glued to the handheld:

Since it was 2nd October, there was a lot on Mahatma Gandhi and his life, but this slideshow on how he is being used extensively in advertising over decades is a rather interesting one. Link: http://economictimes.indiatimes.com/slideshows/advertising-marketing/different-faces-of-mahatma-gandhi-in-modern-advertising/mahatma-gandhi-in-modern-advertising/slideshow/23399695.cms

 

“The Biggest Start-up Mistakes I’m Happy I Made” is not a title that’s going to miss the attention of any entrepreneur. I didn’t miss it either. Here are thoughts from J T O’Donnell on LinkedIn. You will find some contrarian ideas and some to resonate with as well. Overall a useful reminder to all entrepreneurs. Link: http://www.linkedin.com/today/post/article/20131001023617-7668018-7-business-start-up-mistakes-i-m-happy-i-made

 

Reading Books that are banned is thrilling! Here is a very interesting list which you may find amusing and confusing (as to why they were banned in the first place). If you are the type who loves to read, getting your hands on one of them could be a wonderful experience. Link: http://www.forbes.com/sites/alexknapp/2013/09/23/five-banned-books-that-you-should-read-that-you-probably-havent/?utm_source=dlvr.it&utm_medium=twitter

Books and Me: Accidental India

Books Title: Accidental India

Author:  Shankkar Aiyar

For some time I have been wanting to read an economist take on India’s development, especially around liberalization.  Though macro economics is not my primary subject of study I have been intrigued, by the number of times liberalization has been mentioned during conferences and during my interactions with successful entrepreneurs. The references by these practitioners on the macro economics of India’s development did not make me too comfortable and hence I decided to pick a book.  Among the many I browsed, I picked Shankkar Aiyar’s ‘Accidental India’ – primarily because of its structure and hypothesis.

The book is structured around seven major events that have been seen as forward looking  and have also triggered changes in society. Was all this sheer accident? Or was it as per well laid plans? The seven events around which stories have been beautifully weaved are:

The liberalization of the economy, 1991
The Green Revolution , 1964
The Nationalization of Banks, 1969
The Operation flood, 1970
The mid-day meals scheme, 1982
The software revolution, 1990
The right to information, 2005

Each of the above mentioned are spoken of as major revolutions that have solved India’s challenges and also paved the way for development. While there is no doubt about the success and benefits of the various events,  I was rather surprised and amused on how each of them came to be. While the author’s deep research and incisive analysis builds the rational to show how each of these revolution were the result of a crisis and were not a result of any plan makes the already precarious development story appear scarier,  the fact that in most of these stories the protagonist was someone much lower than the leadership layer working slowly and steadily against all odds and obstacles to solve problems definitely leaves a positive feel.  A little more awareness and sensitivity by the leadership would have leveraged these actions, multiplied the benefits many times over. Reading the book also provides a detailed understanding on number of events that led to these successful revolutions.  The stories are filled with data, real life characters, people whom we may have known, heard of and also some unsung heroes . The stories have been weaved like a fast pace bollywood flick  with enough action, emotions and romance.

While it is a book on economics and development, the author ensures that you will keep reading till the end through his excellent story telling ability. If you are not from the area of economics as your daily job, you will benefit in knowing more about India, its actions, its policies, leadership, politics and execution machinery, which infact is eye opening.  After reading the book and being convinced by the author that every revolution in India has been caused by crisis – the epilogue raises questions on today’s challenges of the country, including power, agriculture, water and education.

Governing a country like India is not easy. But at the same time with the amount of intellectual ability and strength that we possess we definitely need better ways to foresee the challenges and opportunities that are in front of us as a nation. This understanding definitely adds one more lens or perspective to viewing our own actions before acting on them. I thoroughly enjoyed the book, learnt a lot from it and am motivated to read further on how strategy can help in public policy.

Customer Money – A great source of capital

In recent times we have heard of enterprises that have started and scaled without customer revenue. They have short lives fueled with investor money, simply based on valuations. While this may be a good game to play and exit at the right times – enterprise creation that lives on customer funding is the only one that supports the society. It is the one that sustains the enterprise, provides jobs, improves lives and enables development over time. But very few early stage entrepreneurs talk about revenue over valuation.

In most training programs and mentoring meets for early stage enterprises, the demand is more to understand building intellectual property, valuation and venture capital. Think about it. There is very little interest in understanding customers better, making better Go-To-Market plans, and managing operating cash cycles. Traditional small business owners on the other hand ask for the latter!

The whole country is talking about entrepreneurship as the way out of the slow down. Entrepreneurship and small businesses are being touted as important instruments in our economic and social revival. But for all this to happen, we need entrepreneurs who can create businesses / enterprises (even healthy small businesses) with some basic economics. Only with basic economics will they stay alive and be sustainable over long periods of time.

While investor money serves its purpose in certain cases – it is not a panacea to all start-up problems. We need more entrepreneurs to not discard their entrepreneurial dreams because the limited venture capital and angel market did not find the proposal too interesting. We need them to make use of the decreasing distance between the start-up and the customer, and try to seek customer money to start and grow the enterprise. If it can be done on crowd funding sites for artistic projects and niche products prototypes – is it not possible at a larger scale for number of our entrepreneurial minds?

Customer money is a source of capital. In fact it is the most inexpensive form of capital and it is also the most sustainable form of capital (if done right) over time.

Think about it!

Entrepreneurs and Sales

“Why Sell?” – Never ask this question! Right from the time you are born you have done that. While all of us acknowledge that as an obvious happening in hindsight – when it comes to our start-ups, most entrepreneurs refrain from selling. They get creative with the reasons why they should not sell!

Why sell’? Because ’ Sales’ is the life blood of an enterprise.

No sales => No revenue => No cash => No business

Still it is rather surprising that entrepreneurs don’t create a disciplined sales process in a start-up. There is a lot of effort on branding, marketing, public relations, human resource, quality assurance, etc but not sales. Somehow ‘sales’ always gets missed out. This is true across industries without exception. In most cases the entrepreneur does some random sales activities, but since it is not a sustained and planned effort, there is no momentum being built in the venture. There is no adding on to existing work. It is always a part time activity that is put the back burner once the plate is full.

In fact every start-up must ensure that it sells every day or at least attempts to make a sale every day. ‘Sales’ requires discipline, perseverance, conviction and patience. It is actually a great way to help potential clients solve their challenges / problems with the products and services that you have on offer.

The next time when entrepreneurs ask ‘why sell’; ask them if they have an alternate solution to make sales happen. It is very important that entrepreneurs don’t keep raising alternate forms of capital to stay alive. The earlier a start-up begins to receive sales revenue, the better the chances of success. So where is the doubt? Start selling now! The question to really ponder is – ‘is there a unique way to make sales happen without selling?’

Think about it!

Vedantic Wednesday: Shake-up but Not dead! So?

Yesterday I had an experience – rare one in so many years of haven flown all over the place. I had a flight back home after my workshop with one stopover. During the first leg of the flight, mid air, we suddenly experienced a terrible shake-up. While the captain did warn us before we took-off about possible turbulence en-route, this was fairly more than a normal turbulence. During those 20 seconds or so, I saw firsthand what happens to people in case of an emergency. For the first time I kept calm. Instead of closing my eyes, i kept it open and looked outside. It made me feel i was being tossed around by someone just for fun! Everyone was shaken. Thanks to the captain (and to God, prayers, etc too) we were again flying smoothly –but most people kept looking at each other in disbelief, disbelief about seeing each other not dead or was it that we were still alive. It was my first experience of scenes that i see only in a movie or read in a book. Scary it is!

The truth is somewhere deep down at those moments and for a few moments after that, we think about the value of life. We think we must drop everything and do what matter the most. But in a few hours we are back to what we normally do in life. We forget that ‘Life is a like a dew drop on a lotus leaf’ and that we experienced it a little earlier. We forget the knocks and shocks of life when they are delivered in small quantities. We don’t take the effort to understand how to live life. We don’t do what we are born to do. Why? Because we misunderstand life! Somewhere deep inside us we fail to understand that what happens to others (death) can happen to us as well. Such little reminders that tell us about the fragility of life is ignored with the dangerous assumption that it won’t happen to me and if it does, i can handle it much better. Both of us fail on occurrence.

I was back home and spent the evening at work. It was only before going to bed; I casually mentioned this to my wife. We had a lovely little chat about the importance of that lesson and discussed how we can narrow our distractions further.  These knocks and shocks are only to remind us to get back on track, not to demotivate and make us give up on life. This misunderstanding is what has made us miss the beauty of the subject of philosophy, in particular ‘Vedanta’.

If you are conscious, aware and alert there are many situations in life that give us this message – but we miss it because of our ignorance and distractions. If you learn to stay alive and alert every moment to the happening at that instant, life will be more happening!

This is the central message of Vedanta – learn how to use the time given to you to evolve and reach your kingly state from which you have fallen.

I am writing this blog today because I was given a chance to stay alive – and I hope to do things that fit more closely to what i can contribute. What will I do with everything I accumulate, if 20 seconds mid-air can make everything redundant? What will I do postponing all close-to-heart activities in life, if 20 seconds mid-air can end the journey? Then there must be something more to life. Don’t wait for harsher knocks and shocks as reminders to start living life.

Gandhi Jayanti 2013

2nd October every year is a national holiday in India. The reason we have declared this as a holiday is (I assume) for every one of us to remember the contribution of this man for what we have today – independence. While we were young we used to watch the famous movie ‘Gandhi’ almost every year. It is touching, provides fresh messages every year since we get older every year. The life of Mahatma Gandhi is a case study on life and living. Here was a man who took up a single cause in his life and gave up his life for that cause. This single pointed effort with extreme conviction in the action is what gave him the strength to stand up against all odds till the goal was reached.

I still watch Gandhi every year as the movie continues to get screened on some channel or the other. And to my utter amazement every year a fresh message triggers in my head. But among many things that I admire of this great man who walked the same land as we do, is his audacity to court truth and actually live it. ‘My Experiments with Truth’ is a brilliant view of how true he was to truth itself. Every page in the book has lessons that can be culled out. A simple example is his reading of ‘Gita’ every time he had confusions in life. Do you have a scripture that you have identified for yourself to seek clarity during difficult situations in life? Nobody said ‘Gita’ is the only book we must use, but we need something to be grounded. Gandhi found the ‘Gita’ – how about you? Find one for yourself.

I hope we spend a little time this Gandhi Jayanti and reflect on what ‘independence’ really means. The forefathers of this nation have sacrificed a lot for giving us this wonderful gift. If we understand and value it, we will understand the responsibility that comes with it. Gandhi’s life and his autobiography is just a reminder to us about this inherent truth. Watch the movie, read a few pages of his book and experience the power of ‘ahimsa’ and ‘truth’!

I cannot forget the widely quoted words about Gandhi attributed to Albert Einstein – “Generations to come, it may well be, will scarce believe that such a man as this one ever in flesh and blood walked upon this Earth.”

How many clients did you speak to this week?

I love asking my clients this question. In most cases for all the talk about growth, strategy, customer intimacy, customer relationship, marketing, and service, most entrepreneurs don’t speak to customers at all. In fact many avoid it till it becomes absolutely essential. The question I get asked is – what is there to speak? It sends me in a tail spin before I gather myself and ask them again: How many customers would you like to be speaking to this week? They give numbers – 10 / 20 / 200 – mostly random numbers – but what’s wrong! Everything started with somebody’s dream – isn’t it?

The importance of meeting customers (both existing and potential) is an important activity for the CEO of a company. It requires the entrepreneur in our case (since we deal with small and medium entrepreneurs) to step outside the office or be on skype / gtalk / hangout / video conferencing (if customers are not geographically reachable) at least 50% of the time. This is because, based on my experience companies where the CEO / Entrepreneur / Owner spends half of their time meeting customers, the businesses seem to be doing better than most others.

Especially scientists / technologists / researchers who are looking to commercialize their creations should learn to do this more often. These people spend inordinate amount of time at their offices and labs and keep wondering why customers don’t seem to be buy such an obviously relevant and useful product? Assumptions, especially about customers, are a big mistake that entrepreneurs make – in fact I think we should call it a sin!

So, don’t wait for us to meet so that I can ask you this question – ask it of yourself! Even if you are an individual this same question applies. Ask and ensure you spend enough time (at least 50%) interfacing with your customers. It will change the way your business (individually and as an enterprise) responds.

Think about it!

Me, a swami and a DJ

Three people entered the hotel around the same time. It was fun to stand in the reception for a while and watch the happenings! It taught me an interesting lesson for life.

The group waiting to invite the swami requested the hotel to start playing bhajans prior to the swami’s entry. About 30 people (almost an equal number of men and women) were waiting in the reception with flowers, arati, plates, etc.,. As soon as the swami’s car reached the portico all the members waited for him to step into a plate with some color water, bless a few of them, was showered flowers upon and then ushered in to his room. I told my attendant not to hurry because the group handling the swami seemed too worried that I may take the lift and the swami would have to wait for the lift to come back. I was happy to sit and watch the events anyway. Why hurry in life? Once the swami left the scene to his room, the whole group (most of the members) went along with them. Since i was standing there for a while and offered to give way to the swami, one of the group members offered to get me a meeting with the swami too. I humbly thanked him and excused myself.

Soon after I went to my room and came down to check some details regarding internet etc.,. I was told that the person who just passed by me was a popular DJ – the person in the reception seemed to expect me to know the DJ! I did not want him to feel let down and so acknowledged saying “oh!” and he was telling me about the evening program in the hotel premises where he was to play some music. He even told me that he could organize some tickets if I was interested. I thanked him for his gesture and returned to my room. In fact there are people fighting with the hotel authorities to allow them to meet the DJ, get his autograph, get passes, etc.,.

The hotel seemed to change their settings every few minutes / hours based on the guest. It’s their business. And of course there are people like me (thinkers) who prefer solitude and no disturbance. They ensure that as well. Lesson is not to find whether going for an evening of music is right / wrong or spending time with a swami is right / wrong – it is about what should we be doing here and now?

It was rather enticing to go to the music evening – but i asked myself would the swami go? He wouldn’t – not because he should not but because he has his business to attend to! Would the DJ spend time meeting his fans, preparing for his evening program or go to listen to the swami’s discourse? The answer is obvious! Similarly when we are committed to a single purpose, we must learn to pass distractions along and keep at work. I had blogs to write, prepare for my workshop, review my forthcoming newsletter and of course read for a few hours (daily habit). With all of this work on my table, how can I entertain distractions? Thankfully with lots of help from philosophy, my teacher and daily reflection on scriptures, I am now able to avoid most distractions and stay focused.

Just think how many times we get enticed with the possibility of meeting a celebrity, excitement of a star staying next door, listening to a good discourse, etc.,. And all these are worthy enough to indulge in – but not for those with entrepreneurial inclinations, importantly when we are on business. Focus is to keep at what we want to achieve and not find excuses to avoid what we should be doing. Be it a swami or a DJ – keep to your work, because they are doing theirs. And may be ancient wisdom is true: “work is worship”. Thinking before acting is one way to develop and keep focus. There is a time for meeting swamis and going to concerts – and at those times at least avoid carrying your mail service J Even that is focus!

Think about it!

Interesting Links This Week: 29-September-2013

These are the links that made it to the top of my reading list this week:

A blog that will resonate with every founding team. The lessons that I learnt are innumerable and invaluable.  http://bit.ly/14uNNnC

 

Interesting ideas on education from Reid Hoffman http://t.co/DGUx9pYPW2

 

As an author this link had to catch my attention and make it to the top http://t.co/SyAKwgpS3G