“We are moving to electronic platform funding”

Manas Kumar Nag, CGM-Small and Medium Enterprises, State Bank of India

State Bank of India (SBI), being the largest lender in India, has the benefit of a wide and deep presence in the Indian market. This also reflects in its performance with respect to extending credit towards MSMEs over the years. SBI has in fact emerged as one of the biggest contributors to meeting their financial needs in a profitable way. Manas Kumar Nag, CGM-SME, SBI talks to Bhuvnesh Talwar and shares the dynamics of the company’s SME business in further detail:

B&E: What is the eligibility criteria that you have defined for SMEs to avail loans with SBI?
Manas Nag (MN): MSMEs comprise of manufacturing, trade and services organizations. We have various customised schemes/products for different groups of borrowers. Therefore, eligibility would be as per the scheme. However, broadly speaking, we apply the Know Your Customer (KYC) concept, which includes identifying whether the borrower falls within the definition of micro, small or medium category and assessing the business activity and the borrower credentials to see whether the business can generate sufficient income. We have presently an internal system of rating, which is a prerequisite for sanctioning loans above Rs.25 lakhs. We have certain hurdle rates below which we do not sanction loans.

B&E: What are the major loan/credit products/schemes that you have launched for SMEs, in consideration of their diverse needs?
MN: We have several customised schemes and products and also have tie-ups with industry majors for funding vehicles or construction equipment or healthcare products. In addition, we also have schemes like Doctor Plus/School Plus, which are specifically tailor-made for such groups of borrowers.

B&E: The default rates for these products are generally a cause for concern. What has been your experience?
MN: Default rates are very low in certain schemes and in others, they are higher. For example, we have found that our doctor plus scheme has a much lower default rate as compared to our transport plus scheme. The nature of activity, choice of borrowers and the area of operation are the factors that determine the rate of default.

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Source : IIPM Editorial, 2012.

An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.
 

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ENTREPRENEURSHIP: CRITICAL FOR GROWTH

John Danner, Senior Fellow, Lester Center for Entrepreneurship, Haas School of Business, UC Berkeley

ENTREPRENEURSHIP IS CRITICAL FOR FUTURE “POWER 100S”. BUT FOR THAT, MANAGERS NEED TO THINK LIKE ENTREPRENEURS & B-SCHOOLS NEED TO NURTURE CREATIVITY

It’s not big corporations that are the lifeblood and future of most modern societies. It’s the entrepreneurial venture that most often drives real innovation and growth, whether in jobs, technologies or economic competitiveness. Our current business education needs to produce individuals who will create tomorrow’s jobs and opportunities, not just manage today’s established businesses.

Perhaps, the biggest challenge mature businesses face in the present scenario is how to integrate and optimise their own existing operations (the execution necessity) while simultaneously encouraging creativity in new products, processes and services bold enough to withstand the onslaught of new market entrants (the innovation imperative). Too often, managers cling to the familiar at the expense of the novel, and watch impotently as insurgent entrepreneurs take over markets they once dominated. Future company executives need to be educated to better guard their defensive perimeters as well as accelerate growth offensively; in short, to think and act more like the entrepreneurs their companies once were. After all, most big companies didn’t begin BIG.

This is where entrepreneurship education takes centre stage: helping impatient dreamers convert their business visions into successful enterprises, and preparing more cautious students to strengthen their own managerial repertoire as they join major companies. Indeed, it is the conflict (and occasional collaboration) between these two groups that animates, distinguishes and even inspires market-based societies.

Entrepreneurs – whether they want to get rich, change the world, or both – initially need to understand how to identify emerging opportunities to serve customers, assess and manage the risks of designing and building new solutions and business models, assemble resources based on future prospects of their vision, while remaining flexible enough to adapt to surprises in the marketplace. Yet, they need to be fluent enough with the techniques and systems big businesses use, so they can adapt to the rigours of growth.

Read more.....

Source : IIPM Editorial, 2012.

An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.

Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri's Session at IMA Indore
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Professor Arindam Chaudhuri - A Man For The Society....
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Management Guru Arindam Chaudhuri
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IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links

GREEN TRANSPORT: WATER TRAVEL

The shipping industry pollutes dramatically more than other modes of transport. It’s in dire need of revival

Over one in ten children are suffering from asthma in the world’s major port cities. Shipping is not regulated and taxed as needed; similar to aviation, since it transports about 90% of all world’s traded goods. Governments in different countries have initiated programs though without major success.

For example, UK proposed a cap-and-trade to encourage companies to follow environment protection guidelines. The World Port Climate Change Declaration conference also emphasised on the importance of greening the shipping industry. Seatrade Middle East Maritime unveiled new innovations in green shipping in 2008. Even companies like Royal Caribbean Cruise Lines are installing smokeless gas-turbine engines or biofuel engines. Many have undertaken research to develop engines to fuel environment friendly CNG and LNG vehicles to avoid harmful emissions like NO2 and SO2. While regulation is imperative, focusing on a few other areas will greatly help.

Primarily, the oil that the ships use is of a very low grade. Technological innovations (use of hydrodynamics in propellers, replacing fossil fuel by renewable sources, and taking care of speed reduction and fleet maintenance) can reduce emissions. But the scale of these initiatives has to be far grander than it is today.

Read more.....

Source : IIPM Editorial, 2012.

An Initiative of IIPM, Malay Chaudhuri 
and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles. 

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Brands as Real Estate Boosters

The shift towards branding in the real estate industry is helping developers log an increase in sales on the back of a relationship built on trust, transparency and timely delivery of projects.

Recently, Ackruti City Ltd., a real estate company with a 30-year track record of delivering real estate projects in Mumbai, changed its name to Hubtown Ltd. The name change was done as part of the company’s rebranding exercise and to better reflect its growing capabilities and delivery standards. In fact, recent years have seen a lot of builders and developers becoming very serious about creating a positive image about their company through brand building. A lot of this change has to do with the changing profile of property-buying consumers today who have evolved into more discernible buyers, especially in matters of big ticket purchases like automobiles and homes.

With consumers becoming smart and looking for differentiated products, it has become all the more important for real estate players to go in for effective branding and marketing. Engaging in marketing and brand building helps real estate firms to attract new business, retain old business and build up a good reputation. As such real estate players are resorting to various branding activities by way of advertising, PR, participation in property exhibitions in India and abroad and making their presence felt on social media network sites.

As building a brand is all about gaining the trust of prospective customers and the industry alike, the route to branding for a real estate developer has to start and end with ‘customer satisfaction’. “Conducting your business in a transparent manner, adhering to timely delivery, ensuring a smooth transition to a registered housing society, all this helps in earning the faith of the customer, which creates awareness in a positive manner about your brand, resulting in sales increase,” says Diipesh Bhagtani, Director, Jaycee Homes. As real estate is a capital asset and a lifetime investment for most home buyers, building a brand in the real estate space is different as compared to other businesses and depends upon a number of factors. The city where the project is located, the locality in the city, amenities provided by the project, timely delivery by developer and possession to the customer are some key factors that a developer needs to look into in order to build trust for his brand and his company. “A developer who manages to provide these to a customer is able to build trust among home buyers in that particular city that he has operations in, thereby enhancing his image not only among customers but among his peers as well,” says Bhagtani.

Agrees Navin Raheja, Chairman and Managing Director, Raheja Developers Ltd. “Yes, branding and promotion are extremely important. However, the biggest branding is your work.” If a developer delivers a project on time and as per the committed quality, his work alone serves as his biggest branding and helps attract a large referral business.

So does a good brand image influence the buyer to choose the right property over other competitors or is it just the project that matters? A good brand image can pull the buyer in, but unless the product is intrinsically good, a sale will not be consummated. Like in all other industries, the product (or project) is the focal point, and if it appeals to the consumer, sales will happen. But, yes, the branding can ensure that the consumer at least considers/evaluates the project. “While earlier most real estate developers were only content with advertising their projects, a new breed of developers, especially those that have a pan-India presence, have realised the importance of branding and are concentrating on brand building exercises,” says Kaustuv Roy, Executive Director, Cushman & Wakefield.

Branding has also emerged as an important selling tool in these days of depressed market conditions. Developers are adapting to the changing environment by re-strategizing innovative business & marketing plans, thereby increasing profit margins. Today, developers are tying up with internationally renowned architects for their projects, thus bringing to the table international technology along with quality construction, resulting in faster deliverable time. This results in more sales within a shorter period, increasing cash flows and reduced borrowing costs for developers. “We do find real estate developers having multiple strategies which can be a mix of tying up with globally acclaimed architects, celebrities, sponsorship of sports and similar such exercises,” says Roy. Not only that, industry experts firmly believe that there’s a strong correlation between branding and stock-market listing. While earlier very few developers were listed, today we have a handful of them trading on the bourses. “Indirectly, branding may be leading to greater transparency in the real estate industry since we expect at some point of time in the future all the large developers to be listed,” adds Roy.

According to Niranjan Hiranandani, Managing Director, Hiranandani Constructions, “Branded real estate products should be able to live up to the expectations of end-buyers in terms of offering a world class qualitative product.” Industry experts point out that though the expectations from branded real estate firms are higher, most of them are able to command a premium owing to their superior quality of products. Customers don’t mind paying a premium for a good brand. “We, at Jaycee Homes, charge 10% higher than other developers for the premium quality we deliver,” says Bhagtani.

Developers are also branding themselves according to their core specializations. For instance, a developer promotes itself as a company which creates a lot of green spaces; some other developer promotes his company for building low-cost housing. This way, a lot of developers have taken to branding on the virtue of what the company specializes in.

For more articles, Click on IIPM Article

Source : IIPM Editorial, 2012

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.
IIPM Best B School India
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
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DECODING THE WORLD’S HOTTEST CONSUMER MARKET

The last year was a tough one for consumer marketers in India. The party spoilers were spiralling inflation, rising input costs and reluctant buyers plagued with twin uncertainties from having less money in their pockets and weak market sentiments. This year, though, promises to be different with various global consumer surveys indicating that the Indian consumer remains one of the most confident across the world as far as his/her future personal finances are concerned. Many of these surveys also point out that the Indian consumer intends to increase spending activities across consumer categories this year. But what is the average Indian consumer thinking? Will he buy more? why will he buy and from whom will he buy? 4Ps B&M and ICMR team up to crack the life and buying style of the urban Indian consumer in 2012 and beyond.

Henry Ford had once remarked, “If I asked my customers what they want, they simply would have said ‘a faster horse’”. He meant to say that consumers simply do not know what they want.

But that was almost a century ago. Consumers, markets and marketers have acquired a different life since then. Geographic boundaries have blurred and information is now available on a click. Like the global consumer, the Indian consumer has not only become king over the two decades since liberalisation, but has gotten very vocal about it too. Ask him to describe his needs today and he will wax eloquent for hours about what he likes, what he doesn’t like, what makes him happy and what doesn’t, what he is wishing for and even what he feels he should have wished for. So now when consumers talk, marketers listen. And listen very carefully at that.

It is this listening to the voices of consumers that has given marketers bestseller ideas for the Indian market – be it fairness creams for men, dust-free keypads for mobile phones, vegetarian pizzas, agricultural tips on SMS or the ‘cash on delivery’ model devised by e-commerce websites to address the traditional Indian paranoia over virtual buying.

Today, more marketers – both Indian and global – want a generous pie of India’s domestic consumption base of $827.9 billion, which translated into 49% of the nation’s total GDP of $1.7 trillion at the end of 2011 (even ahead in percentage terms of China’s 32% consumption share out of a total GDP of $6,476.2 billion). India is a top priority market in the future plans of almost every global company. But getting to know the heterogeneous and diverse Indian consumer is no mean feat, especially in a dynamic socio-economic environment, where what was a novelty until yesterday is quickly consigned to the dustbins of history the next day.

The annual 4Ps B&M and ICMR Consumer Compendium is our effort towards understanding the Indian consumer’s mindset, figuring out his buying motives and also getting a handle on what he is contemplating next and why. Our cover lead over the next few pages attempts to collate and communicate the big takeaways on consumer attitudes and behaviour from our survey spanning key product categories including consumer durables, electronics, automobiles, banking & finance, and online buying. Our series this year attempts to unravel the intricate mysteries of the urban, educated consumer’s mind and mindsets.

For now, as marketers get ready to launch their marketing blitzkriegs into 2012, we urge them to keep the results of the 4Ps B&M and ICMR Annual Consumer Compendium handy. Who knows, which consumer insight may help conjure up that path-breaking strategy that will help you get closer to your individual marketing goals.

They love comparing apples to apples

Here’s a nugget for marketers of consumer electronics like laptops, tablets and camcorders – the front-end experience at the store plays a vital role in your brand’s popularity. Nearly three-fourth of our survey’s respondents said that the front-end experience at showrooms was very important as they prefer that the staff answers their queries regarding tech-purchases properly.

A majority (almost 59%) also said that they prefer buying electronic items from multi-brand outlets and other channels rather than eponymous brand stores, as it gives them the option to compare available brands and prices under the same roof. Subrata Dutta, MD, Samsonite India, is not a technology buff and is therefore more comfortable buying from a multi-brand outlet. “I prefer buying from the multi-brand outlets as I can compare and get to touch and feel the other options available at the same price points. In many situations, the salesmen at the counter and the info they give play a role in what I eventually buy,” he told 4Ps B&M. Guess it’s time to dish out more resources towards educating the ubiquitous store salesmen then.

Here’s another interesting takeaway for electronics marketers. Consumers really do not care whether you have a swashbuckling Sachin Tendulkar or a pouting Kareena Kapoor endorsing your technology-savvy products. A majority of respondents surveyed (52%) said that they buy electronics items because they have a need and they choose particular brands because of ‘features’ that the product boasts of.

As opposed to the multi-million dollar marketing budgets of consumer electronics companies, only about 11% of respondents said that advertisements played any influence over their purchase decisions. Instead, about 27% respondents said that they relied on the Internet when it comes to gaining credible information about electronics that they intend to purchase. For another 15% respondents, friends were a vital source of information on electronic purchases.

The writing on the wall is clear. Instead of pushing a bulk of your marketing spends on buying TV spots and getting celebs on board, there is a need to expand the digital presence of your brand to keep alive the ever-wandering consumer interest in your brand.

For more articles, Click on IIPM Article

Source : IIPM Editorial, 2012

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.
IIPM Best B School India
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM's Management Consulting Arm-Planman Consulting
IIPM in the league of best management institutes of India.....
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Professor Arindam Chaudhuri - A Man For The Society....
IIPM: Indian Institute of Planning and Management
IIPM RANKED NO.1 in MAIL TODAY B-SCHOOL RANKINGS
Planman Technologies
IIPM Contact Info
IIPM History
IIPM Think Tank
IIPM Infrastructure
IIPM Info
IIPM: Selection Process
IIPM: Research and Publications
IIPM MBA Institute India

Foreword for Indian Power Brands

The world’s largest democracy continues its GDP growth at about 8 per cent. A robust growth trajectory has made 1.2 billion people boast of a stable annual growth rate, rising foreign exchange reserves and booming capital markets. The growth story seems to be on a roll indeed, and Indian PowerBrands depicts the extraordinary journey in its one-of-a-kind initiative exemplifying the most powerful brands in India run by the most influential icons to take on and beat their competitors. The ideology further augments the brands’ identity, stability, sustainability as well its credibility. The abundance of the number of domestic companies and rising multinational corporations with a truck-load of brands for consumers to choose from has enhanced the quality of the business environment in India, it has constantly changed nonetheless keeping up with the times in recent years. The strong fundamentals underlying the Indian brand-value make it an obvious choice for investors all over the world, we are the world’s second largest market after all, so why not? There is ample reason for India’s viability as a destination for foreign investment as we live in the times of numerous overseas powerhouses still entering our economic borders. The brand-o-nomics highlight the above, we are talking about higher disposable incomes, an emerging middle-class, a low cost competitive workforce, investment friendly policies and a progressive reform process, and all contribute towards India being the appropriate choice for investors. Indian PowerBrands is a holistic effort to spell out the strength of India Inc. and define the Indian global superpowers of the future.

Overseas investors are still looking at our nation as an attractive investment destination owing to the prospects of high returns. A number of multinational corporations and overseas companies from all over the world have established businesses in India and have expanded over the years. We have witnessed a number of success stories - both Indian and multinational firms have registered higher profits, increased turnover and higher sales over the years. This has induced them to reinvest profits and inject fresh capital into their processes in order to reap the benefits of the Indian growth phenomenon. Investments have been made by corporations across the board and all the sectors have seen inflow of funds. Global players such as Ford, LG Electronics, Samsung, Sony, Amway, Tupperware, PepsiCo, McDonald’s, Oracle, Vodafone, and Nokia among others have benefited from their operations in India and have made expansion plans for the country. The companies plan to expand by way of product diversification, setting up a manufacturing base in India, increasing the existing production capacity, establishing research centres amongst other methods. A brand is always at the center of a company’s interest, managing a brand is not just a matter of putting theories into practice, but an art with a cutting-edge marketability, the paramount importance to the success of the company. This extensive research driven project delivers an array of brand value, brand perception, and brand resonance.

In India, the balance of trade – exports to imports – is higher than what the nation has recorded in recent years, which is only made possible by the marketability of these powerful brands. This phenomenal fact comes from the Government’s viable norm of encouraging the set-up of manufacturing plants and R&D centres along with a sales-wing, formulating an attractive special economic zone (SEZ) platform. Today India officially exports BMW vehicles and parts, Hewlett Packard notebooks, Nokia handsets, Sony electronics to name a few, which is merely a handful of what the list actually comprises of.

Our nation’s brand-economy has strong fundamentals and is host to several eminent global corporate giants that are leaders in their respective fields. The nation has grown to become a trillion dollar plus economy with a largely self-sufficient agricultural sector, a diversified industrial base, and a stable financial and services sector. India looks to the future with confidence of meeting the domestic and international challenges to fast and inclusive growth. Even during the global recession, our nation remained among the top 3 investment destinations. Few nations have the growth potential that India already enjoys, inevitably becoming a land of opportunities. The track record of these Indian companies on the global arena has further strengthened that confidence. I would like to congratulate Marcom on the initiative that they have taken to showcase these Indian companies that have scripted the Indian success story to the world!

For more articles, Click on IIPM Article

Source : IIPM Editorial, 2012
An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.
IIPM Best B School India
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM's Management Consulting Arm-Planman Consulting
IIPM in the league of best management institutes of India.....
IIPM Prof. Arindam Chaudhuri on Internet Hooliganism
Arindam Chaudhuri: We need Hazare's leadership
Professor Arindam Chaudhuri - A Man For The Society....
IIPM: Indian Institute of Planning and Management
IIPM RANKED NO.1 in MAIL TODAY B-SCHOOL RANKINGS
Planman Technologies
IIPM Contact Info
IIPM History
IIPM Think Tank
IIPM Infrastructure
IIPM Info
IIPM: Selection Process
IIPM: Research and Publications
IIPM MBA Institute India

This one isn’t for Adrenaline Addicts. This is seriously social.

In a country where even the most basic of awareness on health-related matters is extremely low, campaigns like saathi bachpan ke are important

I remember my mother’s prayers and they have always followed me. They have clung to me all my life ~ Abraham Lincoln

It is easy to understand why TV viewers don’t usually rate an ad that promotes any social cause under the Sun a “5-on-5”. Non-exciting frames, pre-imagined set locations, conclusions which are no different that what can be forecasted by a toddler et al, suck the excitement out of every TVC that comes with a message to make society cleaner and healthier. True. But it is the bundle of emotions that make these ads worth the efforts. And many-a-time, winners. The effort this time comes from the national alliance christened ‘Saathi Bachpan Ke’ (‘Friends of Childhood’ in Hindi; the outfit shares its name with the title of the ad-campaign and was formally launched on March 22, 2010 – World Water Day – by Timothy J. Roemer, the US Ambassador to India), established by the US AID/India-funded Market-Based Partnerships for Health (MBPH) Project, that has diverse partners from both the public and private spheres (including NGOs, research and media agencies and other public health organisations) working to help improve child health by reducing incidences of diarrhoeal diseases in children under five by promoting simple and effective practices of washing hands with soap, consumption of clean drinking water and oral rehydration salts (ORS) therapy. Says Ajay Sharma, Director, McCann Momentum (one of the agencies which is helping to promote the campaign in India) to 4Ps B&M, “Saathi Bachpan Ke is a diarrhoea management programme, focused on children below the age of five and caregivers.”

The importance of the social TVC to the Indian masses cannot be denied. According to the ‘Safe Water, Better Health’ report by WHO (2008), India is the country where maximum count of deaths by diarrhoeal diseases is recorded (close to 400,000 deaths per year – 26.67% of the global count – of which 90% occur amongst those below the age of five). Surprisingly, a majority of these deaths are easily preventable through proper precaution and cure, one of which (ORS therapy) is promoted by the TVC.

The creative idea used in the making of the ad is based on the simple concept of a mother never giving up when it comes to taking care of her child. The TVC – created by Thompson Social-JWT – is indirectly also a tribute to the untiring spirit of a mother. The ad conveys a message that saving a child’s life through the ORS therapy demands just the patience that mothers display when they watch their child grow up – from teaching them to walk and talk, to waking up at midnight to attend to them and running behind them et al. “Thoda thoda ORS, baar baar” is the message of this ad. The background music – which is a typical melodious lullaby – runs throughout the 40 second-long duration of the TVC, strengthening the emotional appeal of the ad. “The film is based on the insight that caregivers are not persistent in giving ORS repeatedly to a child suffering from diarrhoea since the child often refuses to take the solution. It urges the mother to be as consistent in ORS usage,” explains Kavita Ayyagari, Programme Director of the Saathi Bachpan Ke alliance.

Shot at Madh Island, Mumbai and directed by Pushpendra Misra of JWT, the TVC was released on November 5, 2011. Television is indeed one of the best mediums to communicate with population clusters that are branded either rural or the uneducated class. For India, where education and awareness on health-related issues is a big concern, such efforts must be applauded. Our verdict: in this world of profit-making, such TVCs with relevant social messages are as unique as they are perhaps non-exciting. They appear easy-to-make, but are far more difficult than going on a vacation.

For more articles, Click on IIPM Article

Source : IIPM Editorial, 2011.

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.

IIPM Best B School India
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM's Management Consulting Arm-Planman Consulting
IIPM in the league of best management institutes of India.....
IIPM Prof. Arindam Chaudhuri on Internet Hooliganism
Arindam Chaudhuri: We need Hazare's leadership
Professor Arindam Chaudhuri - A Man For The Society....
IIPM: Indian Institute of Planning and Management
IIPM RANKED NO.1 in MAIL TODAY B-SCHOOL RANKINGS
Planman Technologies
IIPM Contact Info
IIPM History
IIPM Think Tank
IIPM Infrastructure
IIPM Info
IIPM: Selection Process
IIPM: Research and Publications
IIPM MBA Institute India

TAKE A STAND: SOMETIMES LEADERS NEED TO SAY ‘NO’

Corporations, across the globe, must serve the communities in which they do business, as well as their customers and shareholders.

4Ps Business & Marketing, in a strategic alliance with the new york times service, presents a column by howard Schultz, Chairman, President and CEO of Starbucks corporation

There are times when business leaders are so bound by their responsibilities to shareholders that we can forget we have free will.

I am not implying that we should shirk the obligations we have to deliver a return on investment to the people and institutions helping our companies to grow. What I mean is that we as leaders should not become so beholden to Wall Street and short-term performance goals that we stop doing what we believe to be right – inside and outside our organisations.

I recognise this trap because Starbucks and I got caught in it.

Several years ago, while I was serving as the company’s chairman, Starbucks went through a dangerous period of hyperexpansion. This behaviour was fed by a need to meet Wall Street’s high-growth expectations, which analysts had adopted, in part, because our company had fueled them. Starbucks had a rich history of annual revenue and profit increases of 20%, which became tougher to maintain as the company got bigger and the economy began to slide.

Every day, with every decision, my colleagues and I felt more pressure to meet that bar, fearing the stock would tank if we did not. I got so caught up in our monthly sales performance that I often forgot I had the ability – and sometimes an obligation – to say “no.”

“No” to opening new stores rapidly instead of thoughtfully. “No” to selling products in our stores that had nothing to do with coffee, such as board games. In short, we were chasing a pace of growth with quick fixes rather than with more sustainable activities.

One of the reasons I agreed to return as Starbucks’ CEO in 2008, after eight years as chairman, was to reverse this trend. After retaking the reins on day-to-day operations, I began the painful but necessary process of weaning the company from the yoke of short-term expectations.
We began to say “no” to growth for growth’s sake and “yes” to more investments that might not deliver an immediate ROI but would strengthen the company in the long term. We said “yes” to risky but potentially game-changing research and development projects, to closing underperforming stores, to investing in our information-technology infrastructure and in creative marketing campaigns. Many of these decisions involved short-term costs that ultimately paid off.

Perhaps the biggest “yes” was insisting we keep health-care coverage for Starbucks’ part-time workers, despite pressure from Wall Street to drop it. The potential savings would have dramatically boosted our bottomline. But eliminating health coverage for some of our workers who had come to value it would have been unethical, in my eyes, and would have forever drained the reservoir of trust we had established with tens of thousands of people.

Saying “yes” to these types of long-term investments were, in large part, how we reversed the company’s downward spiral.

More recently, I have said “yes” to something else that, while providing no measurable impact on shareholder value, should deliver an equally important return.

In August I wrote a memo to Starbucks partners (our term for employees) to air my personal frustrations with the failure of America’s politicians to work together to effectively address the country’s complex economic problems, including high unemployment. I followed that with open letters to other CEOs and to concerned American citizens, asking them to join me in withholding campaign contributions to any political party until our elected leaders could do what they were put in office to do: cooperate and compromise.

For more articles, Click on IIPM Article

Source : IIPM Editorial, 2011.

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.

IIPM Best B School India
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM's Management Consulting Arm-Planman Consulting
IIPM in the league of best management institutes of India.....
IIPM Prof. Arindam Chaudhuri on Internet Hooliganism
Arindam Chaudhuri: We need Hazare's leadership
Professor Arindam Chaudhuri - A Man For The Society....
IIPM: Indian Institute of Planning and Management
IIPM RANKED NO.1 in MAIL TODAY B-SCHOOL RANKINGS
Planman Technologies

INTERNET GROWTH: 2011

Globally, internet audiences are rapidly proliferating – 87% of the internet population now belongs to regions excluding the united state. Many Emerging Regions are likely to bypass the old modes – skipping dial-up and moving straight to broadband. Moreover, E-commerce growth is now being driven primarily by existing online shoppers, a trend which was at a nascent stage few years back

Asia taking over?

According to the recent report released by comScore, Asia Pacific with 41.2% now represents the region with the largest internet population in the world. From 2000 to 2011, world internet usage has grown by a mind boggling 480%.As a measure of engagement, comScore also analyzed that internet users outside the US account for 13% of the world’s online population in 2011 as compare to 66% in 1996. Many emerging regions, with social networking and mobile internet, are expected to gain momentum over the next few years. That has strong implications for marketers fancying their online edge.

Coupons on the money
A few specific categories have secured top slots in terms of driving web growth. As far as web growth in US is concerned, those are the coupons & retail-movies categories that have driven the growth. Humour was ranked the top gaining category last year with a growth of 88% in Unique Visitors (UVs), but has now dropped to the least growing category with only 8% growth (maybe they need them only in economic downturns!). With already a strong visitor base, unique visitors to the gaming information category grew by 13% since July 2010 and kids sites grew by 16%.

Socially & musically sold

While conversational media sites such as Tumblr & LinkedIn with 223% & 52% yoy growth in UVs respectively are known to be popular among the younger generations, properties such as Vevo & entertainment sites other than social media are fast catching up too. Vevo had 18.6 million more visitors in July 2011 than in July 2010. Even advertisers & marketers are looking for opportunities to advertise on social networking sites as traffic on these sites is comparatively very high. However, the music & entertainment category is fast gaining favour among the youth who are getting attracted to sites like Vevo and Pandora.

India on a searching spree

The global search market continues to grow at an extraordinary pace, with both highly developed and emerging markets contributing to strong growth worldwide. With the recent facts & figures revealed by comScore, it can be seen that 27.4 billion searches were performed in July 2011, which marked an 8% growth rate over the July 2010. India is ranked 8th in the global list of number of searches conducted but it has grown at a rate of 19%, which is the fastest after Turkey & Brazil when we compare the other countries in the top 10 list.

For more articles, Click on IIPM Article

Source : IIPM Editorial, 2011.

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.

IIPM Best B School India
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM's Management Consulting Arm-Planman Consulting
IIPM in the league of best management institutes of India.....
IIPM Prof. Arindam Chaudhuri on Internet Hooliganism
Arindam Chaudhuri: We need Hazare's leadership
Professor Arindam Chaudhuri - A Man For The Society....
IIPM: Indian Institute of Planning and Management
IIPM RANKED NO.1 in MAIL TODAY B-SCHOOL RANKINGS
Planman Technologies

Nation Branding: What Works?

David Aaker, author of the all-time best selling branding textbook – Managing Brand Equity, attempts to identify the most effective nation branding tools

During August, I spoke at the inaugural conference on nation branding, a project the President of Korea initiated in 2009 to create a nation branding programme for Korea. In preparing my talk, I attempted to identify the most effective nation branding tools. I came down to four.

The first is the hosting of global events such as the Olympics, the World Cup, the British Open, The Australian Open, or the G20. Such events get enormous visibility through media coverage, they provide all sorts of positive associations, and they generate visits from influential people and others who will talk about their experiences. The second are events created and owned by the country. They can be within a country, such as the annual Korean Knowledge Forum that attracts luminaries and thought leaders around the world, or the Singapore Film Festival. These events also provide visibility, association involvement and visitors. The events can also be hosted outside the country, such as Korean Day in New York with a K-Pop contest where the winner received round-trip tickets to Korea. Such events provide a culture story, a country experience for those who have not visited, and a chance to allow people to relive a prior trip.

The third is the identification and leverage of country symbols. Symbols can take many forms, such as the Guggenheim at Bilbao, the Edinburgh Castle, a visual of trekking in Nepal, Queen Noor of Jordan, or prominent athletes such as Rafael Nadel of Spain. Such symbols make vivid some aspects, perhaps the central aspect, of the country. A symbol, unlike a verbal description, is easy to remember especially over many exposures.

The fourth is to encourage and leverage corporate brands. Think of the impact Singapore Airlines has on Singapore, or Mercedes has on Germany. These corporate brands control many of the salient country image factors such as cultural values or perceived innovativeness. Further, the sheer budget makes a difference. Samsung plus Hyundai/Kia will spend well over $1.5 billion in media advertising in just the US, a budget that will dwarf the promotion budget of any nation. The impact of Samsung product leadership in the 90s and Hyundai’s ability to get 5% of the US car market with quality and upscale cars has had an enormous impact on the Korean brand.

There are a host of other approaches including advertising (which works mainly to attract tourists) and social media. But, in my view, these four, properly managed, generate the most impact.

In my talk directed at the Council for Nation Branding established by the President of Korea I discussed the importance of creating a strategy that would include objectives, target marketing and brand vision. With a strategy in place, I identified four effective nation branding tools: hosting a global event such as the World Cup, creating events such as the Korean Knowledge Forum, identifying symbols such as the Guggenheim at Bilbao, and supporting the work of corporate brands such as Samsung and Hyundai. My theme was that, in my view, efforts of the council to build the Korean brand should focus on opportunism, support and leverage. I suggested the council should not sponsor or direct brand building programmes, especially local ones, nor expect an ongoing budget to create communication programmes.

For more articles, Click on IIPM Article

Source : IIPM Editorial, 2011.

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.

IIPM Best B School India
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM's Management Consulting Arm-Planman Consulting
IIPM in the league of best management institutes of India.....
IIPM Prof. Arindam Chaudhuri on Internet Hooliganism
Arindam Chaudhuri: We need Hazare's leadership
Professor Arindam Chaudhuri - A Man For The Society....
IIPM: Indian Institute of Planning and Management
IIPM RANKED NO.1 in MAIL TODAY B-SCHOOL RANKINGS
Planman Technologies

When Jack came out of The Box!

What Jargon would you use to Describe the form of Advertising Skillfully integrated into your Natural Surroundings such that it Catches your Attention at places you least expect it? 4Ps B&M adds yet Another term to your Marketing Dictionary. Call it Ambient Advertising

A vagabond once shared an anecdotal experience about one of the several magnificent churches in London. He would describe the finery of the church and then mention about the inevitable cracks in the walls, both inside as well as outside the church. Now, cracks in walls are not astounding to an extent that they need a mention, though they are definitely a pain for the maintenance people. In fact, you too might have observed such cracks in walls, which are usually T-shaped, almost crossing each other, resembling a cross at times. But there was something extraordinary about the cracks in the walls of this particular church in London.

This church had almost the same kind of cracks, but instead of filling them up the church authorities had framed those cracks and written right beneath them: “God exists in everything!” Certainly, God is the last person who would require any marketing strategy, but what a way to use your surroundings to spread across a divine message that God is omnipresent. You might take this as devotion, but it is ineluctably a classic example of an effective yet simple advertising strategy called Ambient Advertising.

Simply put, Ambient Advertising is advertising integrated into our surroundings to catch our attention when and where we least expect it. “It’s about looking at everything in your surrounding as having the potential of becoming a medium of advertising,” Zenobia Pithawalla, Executive Creative Director, O&M India tells 4Ps B&M. For instance, when you finish eating a fairly luscious choco-bar, you expect nothing inside except mushy vanilla and choco crust. But when you are finished eating it all, you end up with a stick, which is not a usual stick that you would just throw away without giving it a second look. Yes, you will throw it away eventually, but not before you spot a toothbrush made out of that stick, and a small yet conspicuous ‘Colgate’ written at the top of the stick, and a ‘Don’t Forget’ message following it (the creative agency for this project was Y&R, Bangkok, Thailand). That’s precisely what Ambient Advertising is! Positioning the brand in a surrounding where the consumer least expects it, but having found it believes that it is the best place to have encountered the brand’s existence.

For starters, Ambient Advertising found its first user in 1996, when a UK based ad agency, Concord Advertising, at the wish of a client, who wanted a change from the traditional mediums, started placing ads at unusual places such as on floors, on fuel dispensers at petrol pumps, toilet doors, et al. Clearly these places were not traditional places to advertise for a product. But the idea worked, and in 1999, British Media recognised this form of advertising as ‘Ambient Advertising’.

Ambient Advertising encapsulates two key factors, one being unusual locations and the second being the quintessential ‘wow’ factor, something that catches you unaware. For instance, when JWT London got a little artsy to emulate a KitKat chocolate bar on a bench in a park (to make it look like a chocolate bar cum bench) with ‘Have a break have a KitKat’ inscribed on the bench; it made use of the both, an unusual location (a bench in a park) and had the wow factor, because the moment you sit on the bench to relax the tagline seems to work on your senses and since you are having a break in the first place, you can’t help but have a KitKat bar!

For more articles, Click on IIPM Article

Source : IIPM Editorial, 2011.

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.

IIPM ranked No 1 B-School in India
domain-b.com : IIPM ranked ahead of IIMs
IIPM: Management Education India
Prof. Rajita Chaudhuri's Website
IIPM Best B School India
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM's Management Consulting Arm-Planman Consulting
IIPM in the league of best management institutes of India.....
IIPM Prof. Arindam Chaudhuri on Internet Hooliganism
Arindam Chaudhuri: We need Hazare's leadership
Professor Arindam Chaudhuri - A Man For The Society....
IIPM: Indian Institute of Planning and Management
IIPM RANKED NO.1 in MAIL TODAY B-SCHOOL RANKINGS

Atoms in Ad-Orbits?

For years, Sandipan & Manoj have worked together to create ads that have moved minds. And they want to move around till the road ends...

Sandipan Bhattacharya and Manoj Deb might have kept their grungy look on hold for now (having chopped their long tresses off and having shed many pounds), but the two are still considered amongst the freshest of young creative rock stars in the Indian ad-fraternity. They hail from the BBDO India brigade and over the past many years, have proven that they’re worth their weight in gold, metaphorically speaking, given their real-world dieting plans. In terms of experience, having worked together as a duo in the world of ad-making for eleven years, the pair is the most seasoned amongst those featured in this cover package.

Both Bhattacharya and Deb, who are today the Executive Creative Directors of BBDO India, were brought on-board during the very early days of BBDO’s India voyage. That was two years back. In fact, during that time, Josy Paul, the current Chairman and National Creative Director of BBDO India, had commented thus, “Both of them have the potential to break the clutter and do something out-of-the-box.” They did so. In the past couple of years, the mind-blowing advertisements that have been rolled-out of BBDO India’s stable – from the 7 Up commercial to the Nimbooz launch campaign – have all been creations of these two brain-boxes. And as if they are out to prove that expenditures in the form of ad-dollars help any brand grow and earn, the ad-campaign during the launch of Nimbooz (the lemon drink from PepsiCo), not only gained heightened interest of the consumers in India, but also forced supply to play the catch-up game with demand in the FMCG market.

But that’s not their only claim to fame. In fact, their credentials make a long envious list. The duo met for the first time when Manoj joined Saatchi & Saatchi in 1999 (where Sandipan was already trying his hands on the creative side of the ad-game). Soon after, their combined efforts started yielding rich results. Initially, they held the creative mandates for Hyundai’s Santro and Accent accounts, but when the agency bagged Maruti Suzuki’s account, they were even handed creative duties for the tall-boy WagonR. In due course of time, they hopped forward from Saatchi & Saatchi to Enterprise Nexus and Grey. There, they worked on clients like Chevrolet, BPCL, Haier, Aviva Life Insurance, OCM Suitings, Suzlon, Wrigley’s Doublemint and Orbit White.

Somewhere along the line, their twain became inseparable. “Our biggest strength is balanced teamwork. Any creative process brings forward many conflicts, but it has to be treated as a healthy debate. And that is when the real value gets multiplied manifold,” says Manoj Deb, adding that this stimulates them to deliver fabulous creatives, ad-after-ad, client-after-client and year-after-year. But that is not to flatly claim that there are no conflicts. “I would say that advertising is not about marching individually. It is a collaborative work. After staying together for so long, we really don’t know what are the negative and positive points about each other. Although respect is key, at the end of the day, the creative process in advertising comes individually. Therefore, it is important that two minds also work uniquely...” Of the two, Sandipan is more inclined towards the creative end of the scale, while Manoj has his hands right in art direction.

For more articles, Click on IIPM Article.

Source : IIPM Editorial, 2011.

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.

IIPM ranked No 1 B-School in India
domain-b.com : IIPM ranked ahead of IIMs
IIPM: Management Education India
Prof. Rajita Chaudhuri's Website
IIPM Best B School India
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM's Management Consulting Arm-Planman Consulting
IIPM in the league of best management institutes of India.....
IIPM Prof. Arindam Chaudhuri on Internet Hooliganism
Arindam Chaudhuri: We need Hazare's leadership
Professor Arindam Chaudhuri - A Man For The Society....
IIPM: Indian Institute of Planning and Management