Aug
28
Posted on 28-08-2011
Filed Under (BUSINESS) by Shombit

From Discomfort Zone column by Shombit Sengupta in Financial Express and Indian Express

How did Japan, the 50-million-peopled South Korea and now China reinvent customer perceptible parameters in a new language? There’s no rocket science involved, nor have they reinvented the wheel. They were just curious about the readily available invented wheel. This raised their observation quality to bring a paradigm change in their action. Only when an individual stresses on Curiosity, or an organization creates a collective process for curiosity, can you drive high Observation quality, which leads to meaningful Action. This is COA.

India’s young generation loves international brands in every domain. They find in them status, elevated quality, the latest aspect and strong differentiation. Till yesterday the ‘Made in China’ label was synonymous with low priced, mass manufactured low quality goods. But tech-savvy people across the world, including young Indians, are not questioning that the Apple iPod, the world’s most in-demand product in their pockets, is ‘Made in China.’ Chinese products have no aspirational deficiency as most technology efficient hardware comes from China today, not India. Irrespective of what India’s “business gods” with successful careers try to establish, that they have changed the paradigm, but in reality they’ve delivered very basic work to global companies in developed countries. Individually they’ve made good money, their companies achieved excellent valuation, but they’ve not added value to technology upgradation, invention or innovation in the world. Yes, a bunch of people got jobs in IT, but does this credit go to our IT gurus or the global requirement for low cost basic work?

Why aren’t Indian companies paying heed to designing a service or manufactured product with unbeatable quality, functionality and aesthetics? Perhaps we are missing COA (Curiosity, Observation, Action) centricity. Beyond-the-routine, curiosity will help unearth a new perspective. The passion to ferret out the new in every domain is the beginning of the search for brand differentiation. It impacts a brand’s action for breakthrough innovation, making it competitive in the ‘glocal’ market.

Since ancient times, Indians have been sensitive in appreciating consistency in aesthetics with strong craftsmanship. Take the 13th century Konark Sun temple in Orissa. Ganga Dynasty King Narasimha Deva-I (AD 1236-1264) built this exquisite temple as a royal proclamation of political supremacy. Just check people’s work consistency then. Initially about 1200 artisans and architects invested creative talent, energy and artistic commitment for 12+ years in executing the design. Imagine if Indians today meshed this legacy and caliber for perfection in meticulous design execution with contemporary digital technology, where a brand can go. Perhaps our people of multiple races interpret design in too many unscientific ways. Or are manufacturers not capable of eliciting passionate curiosity and high quality observation among employees to compete globally?

In the last 20 years, consumer approach towards different products has changed dramatically. An Ambassador car driver had to sit at a 45 degree angle to accommodate 3 to 4 others alongside him. Psychologically feeling the physical distance, “Hello….” people would yell into the telephone when its rings like a fire brigade alarm. In roadside PCO booths you had to wildly gesticulate to the caller inside to indicate the queue. Today you no longer own a 40-year-old refrigerator, the professional dhobi has almost disappeared in the city, most city airports are not railway-station look-alikes any more. All such changes came to India from developed countries, when they brought their innovation/ invention on quality, functionality and aesthetics.

Have Indian brands contributed through differentiated value propositions when consumer desire level has shot up? Explaining her expectation from her next vehicle, a 32-year-old woman said that an instrument panel sensor should indicate with sound the minimum fuel in her petrol tank. When probed further, she questions the lack of a tyre puncture indicator. Just 15 years ago her father’s Ambassador is all she knew. Her mindset change on engineering excellence has come from experiencing foreign brands. Such revelations prove that the protected economy merely empowered a few monopolistic industrialists who lived in comfort zone delivering sub-standard quality to consumers.

But wait! There’s convoluted drama here. People’s buying behaviour has changed but not their working and delivery style. There’s lack of craftsmanship, finesse, enduring quality, connoisseur treatment, sense of aesthetics, excellence of functionality in every domain. If the aim of companies trying to match up to global benchmarks is to chase short term gains without discipline or holistic approach, they may not reach that level. Employee mindset has to change for incredible delivery to happen.

Since 1991 economic reforms, the buying power of around 25% middle class has increased. Correspondingly, what has Indian industry addressed? (1) Responded to the demand-led IT market opportunity of fulfilling basic needs of developed countries. That our British colonizers gifted us the English language helped. (2) Several companies are growing with the single-minded ambition of raising valuation to sell out to a global giant. (3) Indian manufacturers are offering better price advantage in global competition. Basic employment has been generated, but when will India respond with innovation to mesmerize the existing invented wheel the way Japan, Korea and Chinese did?

When COA culture is absent, people want everything in an easy manner, not through struggle and tenacity. To avoid being inferior to global brands, Indian brands can imbibe COA, develop curiosity with extreme passion; while their observation dissection has to be powerful for a new blueprint of differentiation with substance. The brand can then act to astonish ‘glocal’ customers.

At a COA workshop, I examined the threaded end of a Rs.15,000 Mont Blanc pen. This was a solution to secure the cap at the far end while you write. The participants in my class figured Mont Blanc is expensive, so they could do anything. This is pure complacency. They didn’t appreciate the simple breakthrough idea that provided customers with differentiation and extra benefit of not losing the cap. It’s a pity that Indian companies are not taking excellence of global standard delivery seriously. Having this hollow can make India become like a Middle East country where only international brands dominate the economy.

 

To download above article in PDF Can COA break brand mediocrity?

Financial Express link :http://www.financialexpress.com/news/can-coa-break-brand-mediocrity/838209/0

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Aug
21
Posted on 21-08-2011
Filed Under (BUSINESS) by Shombit

From Discomfort Zone column by Shombit Sengupta in Financial Express and Indian Express

Delicate, subtle and unstated desires hide behind a woman’s logical mind. Women sway all purchase verdicts, and multiple subliminal dimensions are factored into their choice. Too many statistics, existing facts and data can become an organization’s bane that immobilizes action. Yet have you considered tapping statistics of the world’s largest market segment? Marti Barletta writes in her book “Marketing to Women” that they make 85% of all buying decisions. This includes 94% of home furnishings, 92% vacations, 91% houses, 51% electronics, 84% banking decisions, 80% health care and as for cars, 60% are purchase by women and they influence 90% of the man’s car buying decision.

Multi-dimensional subconscious aspects impact men too, although it appears that they tend to buy based on immediate needs, on how well the product or service satisfies that need. Women consider the long-term, whether the purchase can be used again and again. Either way, as the technology revolution escalates, people’s sensitivity has been intensifying. Our understanding of products and our psychological involvement in them have increased conspicuously from what it was 15–20 years ago. The diverse ways we approach a product or service to extract individual benefits can be stretched like a piece of elastic. Our collective perception of quality has severely augmented, but when it comes to choice, it’s an individual who selects. Multi-dimensional mental involvement encompasses the choice of tomorrow’s consumers.

When customer psyche sensitive enterprises understand the factors affecting human psychology, they try to incorporate benefits that capture the consumer’s hidden desire. Traditionally, different products like the camera, television, computer and kitchen equipment were businesses of different competencies. Responding to the multi-dimensional aspect of choice driven by the subconscious, the compartmentalized outlook of manufacturing companies has been derailed. After all, the user of all these items is the same person. Because of the homemaker’s choice, a single manufacturing company like LG and Samsung, has entered the total ecology of her home.

Of the identified psycho-socio factors that will drive tomorrow’s business, behavior is quite assessable, but what about reckoning the mind? This varies according to the nation, geography, culture, language, religion, economic class, the political milieu, age and family environment. Finally it’s a person’s self-confidence that stops the buck. Let me explain. At the very base of this decision making hierarchy is the country a person belongs, the kind of geography she lives in that induces specific purchases. The collective consciousness of culture, language and religion, plays a role as obvious as the economic class a person belongs to. The political environment plays an enabling part as to whether certain goods and services have been made available under that government. Different age groups definitely behave in their diverse ways, influencing purchase or detracting others from spending. The immediate social and family environment factor in the decision for purchase, and at the very top is a person’s self confidence. If we have a population of say 6.5 billion people in the planet, we can upfront say there are 6.5 billion psychological strains to deal with. The accumulation of these strains comprises multi-dimensional consumer sensitivity.

No management process has to date found a mechanism of how to understand and capture the multidimensional psychological content of the human race.

Innovation needs the subconscious mind: The primary requirement of any company’s innovation center must be the invaluable knowledge of people’s psychological dimension. Being tremendously sensitive to consumers will result in sustainable innovation. You may be serving your B2B customer, but your customer’s end consumer will be very involved with the psychological paradigm. Innovation centers in general employ technologists, engineers or scientists, but never consider recruiting psychologists or sociologists. The total absence of psychology or sociology makes innovation take on a technical shape without human sensitivity. This results in technology-based products, which then become generic. If the innovation environment considers the cognitive and societal ramifications, that innovation can gain in differentiation, in its capability to earn premium and to sustain in the market.

Sophisticated management theories to win against the competition are driven by numbers. Using modern technology, logic and mathematical matrix, they conjecture on given facts of the past. This is diametrically opposed to human development where intellectual facets grow at an individual level. Observing the market through standard statistics can generate enough data to paralyze an organization or create an abscess in a business segment. In a given activity sector, all competitors watch the market in this same angle. Even as they lose the microtonal layers of the psyche, they end up dabbling in business mediocrity. So products and services in that domain start looking alike.

Benchmarking with statistics is a global business process. At a local level, it bypasses the consumers’ psychological facets. Business leaders with articulation and number-crunching skills who feature in Fortune 500 global companies often get accolades for their company’s power, size, and business results. But if you ask these leaders what is the emotional level at which their product or service connects to the masses, will they be able to answer? They may score only with power and size.

Developed societies took a long time to understand the need of appreciating people’s subconscious choice, particularly of women. This realization emerged from the competitive pressure in sophisticated markets. Intense competition threw corporations off their thrones to check out ground reality with more consumer research to understand psychological gaps. An economically emerging country like India has several socio-economic layers of women with differing psychological subsets. Do Indian organizations factor this in as the real market space to drive future business in?

If there is no world war in future, the world of business will run only on the basis of the human psychological aspect. Indian companies that aspire to become transnational have to venture into this area with substantial investment. Start with understanding the psychology of women, the world’s biggest buyers. This can win you an unending business platform to grow and sustain your business profitability.

To download above article in PDF Squeeze the psyche to make them buy

Financial Express link :http://www.financialexpress.com/news/squeeze-the-psyche-to-make-them-buy/834732/0

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Aug
14
Posted on 14-08-2011
Filed Under (BUSINESS) by Shombit

From Discomfort Zone column by Shombit Sengupta in Financial Express and Indian Express

Fashion means exuberance, newness, getting away from boredom, making customers dream, shocking society. Shock-of-the-new is a trigger in society and in the mind of customers who drive society. It has to be seen, become a buzz, incite a craze in people to know more. Developed countries have mastered it, maintained it. So 21st century fashion communication there is not only provocative, it stimulates the deep desires and fantasies hidden in the customer’s mind.

100% FDI will create shock-of-the-new: When FDI opens up for multi-brand retailing in India, international multi-brand stores will create shock-of-the-new, sustain and change the color of fashion retailing here. To avoid getting blasted away, Indian multi-brand retailers will have to market the intangibles of fashion in retailing and branding. Anybody can do apparel business with 5 basic elements: fabric, limited texture, color, cut and fit, but a fashion brand is created only when fabric transforms into an imagination metaphor with the infusion of visual art effects. International mass fashion brands like FCUK, ZARA among others have no designer name. They compensate that at every customer touch point with regular changing fashionable merchandize at the retail through visual merchandizing, façade, shelf and fixtures interwoven with visual art.

India allows upto 51% FDI in single brand retailing today, and 100% in the cash&carry business. A few shock-of-the-new examples: from 1991 to 2004, consumer electronics brands arrived from developed countries and almost knocked Indian brands out of the market. WTO regulations in 2004 resulted in foreign automobile brands marginalizing most fully Indian sedans, so they’ve become taxis. A brand sustains an idea by bringing in change, and at the same time retaining, year after year, the core that creates the shock-of-the-new. Take Apple, the brand that has sustained an element of shock-of-the-new in all its products from the first Apple machine in 1976 to Mac computers, iPods, iPhones and iPads today. On 9 August 2011 Apple nudged Exxon Mobil to be crowned the world’s most valuable company with a market capitalization of $337.2 billion.

Indian vs. international brands: Living in a truly liberalized atmosphere with access to worldwide media, Western marketing tactics have proliferated here making Indians more brand conscious. In a recent dip-stick study we found Zappers below 30 years believe international brands to be trendy, fashionable, with new designs of better quality styling. The 31-45 years Compromise generation sees wider options in international brands and is ready to spend in their economy products. The 45+ Retro generation prefers to buy Indian, but for better quality can shift to international brands.

Shock-of-the-new has a positive impact on society’s drivers comprising socio-behavioural clusters of Flamboyant, Novelty seeker, Critical, Techy and Gizmo lovers. The trends they set spread to society’s followers, the Low key, Sober and Value seekers. As driver behavioural characteristics are growing in India, we can expect drastic changes in fashion retailing when the Cabinet gives the green signal for 100% FDI in multi brand retailing.

Retail stores are multiplying like mushrooms in India but they do not follow fashion’s diktat. Localization is always required, but you cannot localize something that is not part of your culture and competence without first learning its function in depth. Take the case of French Galleries Lafayette opening a store in New York’s Trump Tower with $8 million yearly rent in 1991. They failed to localize according to American customers, and had to close shop within 3 years.

Every fashion category requires the association of imagination. It’s like looking at a single image created from multiple mirror images. In India, we don’t follow any established fashion code but invent fashion in a sporadic way. For example, putting a cosmetic product in a sophisticated container with a Bollywood expression cannot create hedonism. The two are not complementary as Bollywood is an ephemeral world while a brand has to sustain.

PUB Reflex: When FDI opens up100%, global lifestyle brands with huge brand pull will enter to indoctrinate the retailing system in India. If allowed to source freely, they will offer multiple international brands at aggressive, multi-layer price points. They can crash the price very low as they know volumes will be very high in India. To ride the shock-of-the-new wave, Indian multi-brand retailer must ignite the PUB Reflex, which Provokes the customer to Understand so she Buys (http://www.indianexpress.com/news/the-pub-reflex/780514/0). It’s certainly possible to compete and sustain as is evident when China opened 100% FDI. Chinese brand Li-Ning managed to dislodge all international brands in sportswear in 2004 and became second only to Nike (16.7% market share). Li-Ning’s 14.2% market share came from leveraging subtle nuances of Chinese heritage to build a brand globally.

Fashion advertising driven by visual art: Fashion marketing is very different from FMCG marketing which is more technical centric with a price boundary that requires rational and functional superiority. Fashion marketing is driven by visual art and continuously empowered from backstage. Pierre Berger, manager-partner of haute couture designer Yves St Laurent says, “I’ve always watched what Yves would do, and never interfered with his actions. From backstage, I would collect the nuances of his creativity to highlight for marketing and to strengthen the brand YSL we created.”

Fashion marketing’s real job is to magnify visual art to become larger than reality. Fashion reflects desire, self seduction, projection and high spirits, not customer need. Supply chain or production cannot replace the lack of visual art in backstage fashion marketing of intangibles. Mass fashion started in the West since the 1980s while following the impact and doctrine of haute couture. The latest retail marketing innovation is the totally new departure made by H&M which, while being a mono-brand retail is co-branding H&M with reputed designer brands like Lanvin and Versace among others to give consumers a multi-brand experience. Even WalMart’s private label Metro 7 induces fashion intangibles. The more fashion associates with visual art, the more intangible it becomes, and can accordingly command its price. What shock-of-the-new can we expect for fashion brands when 100% FDI opens up for multi-brand retails in India?

 

 

To download above article in PDF Will 100% FDI blast away Indian fashion retailers?

Financial Express link :http://www.financialexpress.com/news/will-100-fdi-blast-away-indian-brands/831597/0

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Aug
07
Posted on 07-08-2011
Filed Under (BUSINESS) by Shombit

From Discomfort Zone column by Shombit Sengupta in Financial Express and Indian Express

Every Moment Operating Discipline (EMOD) that I wrote about last week hints at how a mechanical procedure drilled into employees, when internalized, can enrich customers and increase business. Irrespective of your social or working position, when you aboard an aircraft the flight crew commands you, with smiles and soft voices, on how you should behave during the flight. You have to maintain some discipline for safety and security purposes at different altitudes and for times such as take-off and landing.

So with your Attitude, Behavior, Action and Delivery you ABoArD the aircraft consciously following its every moment operating discipline. Like this aircraft where parameters are regulated for speed and rationality, employees change their inherent system to ABoArD this value framework of an enterprise for a continuous journey.

Business, however, is always at ground level, although its complexity and risk factors fly in high altitude. Such high altitude risk can be equated to competitor aggression. Take the example of digital technology that has shifted several social trends and marginalized a category like celuloid film for cameras. With top notch knowhow in one industry, an enterprise can even enter another domain to crumple a big category. That’s what Apple did. From the computing industry, Apple bombarded into the entertainment industry and collapsed several strong players in this space. Attitude, behavior, action and delivery form the foundation of the ABoArD strategy. That’s why the highly professional ABoArD way of piloting your enterprise will give you a better edge as aviation engineering is related to high precision and technology solutions.

Attitude and behavior are intangibles that create differentiation in the service business. To portray service in a superior plateau, highly fashionable and excessively priced Parisian restaurants require reservation at least a month in advance. Their intangible art of the table and service quality makes them coveted. Different wines in appropriate wine glasses accompany the wine taster’s gestures and conversation to justify the exclusivity of the wines from different seasons and regions. Impeccable table service means if a person in your group of four is not eating, a plate will still be ceremonially put in front of him to include him. Waiters are trained to proactively keep an eye to anticipate every small requirement on each table. This attention to service can only come from a structured and defined attitude and behavior that employees are trained to follow. This reference can be processed for use in any service industry.

In India’s diverse and plural culture, flexibility is a common characteristic across every way of life. Being flexible or accommodating is very positive for maintaining relationships, but chalta hai and OK are extremely dangerous in business. Flexibility in business will always translate to the repairing mode or the quick application of putti approach. Only an attitudinal aspect that questions, is conscious about discipline, sensitive to creativity and differentiation, can align a business process to deliver meticulous quality.

There lies in India another exceptional aspect which may be unique in the world. All the States have their own mother tongue: Tamil is spoken in Tamil Nadu, Assam speaks Assamese, Gujarat converses in Gujarati while Punjabi is Punjab’s oral tradition. But the Hindi belt comprising of Uttar Pradesh, Uttaranchal, Bihar, Jharkhand, Madhya Pradesh, Chhatisgarh, Himachal Pradesh, Rajasthan, Jammu, Haryana and Delhi ostensibly have one language. This so-called common language takes away from the identity of each State’s character, and makes them homogeneous, which in reality is not the case. This kind of mixed culture encourages a totally erratic attitude. As Hindi has been declared India’s national language, although not everyone embraces this pronouncement, the mixed culture of flexibility has seeped into the functioning of people in all States. In a business enterprise, when employee attitude is so diverse, their behaviour gets impacted with that erratic culture too. As attitude and behaviour drive the core essence of a human being, the chalta hai and OK mentality drive every action, so the delivery is bound to fall into mediocrity.

A hangover of our Colonial past is high admiration of the Caucasian society. In response to that, many American management consulting firms have come to India to teach Indian companies with American discipline. They fail to take into account, conform to, or seamlessly mesh with, the societal aspects of people here. Over time Americans have managed to integrate the different types of people from all over the world who call themselves Americans today by inventing an operating discipline that’s stringent, has one culture, one language, and demands efficiency. In India people do not have the same temperament. Yet we have to do global business and so need to practice discipline, creativity or alternative ideas and process.

Discipline is the precisely coordinated attitude of forward planning. It maintains coherence at all times and empowers relevant teams to execute work on time. Discipline avoids crisis management, which is never good as there’s a possibility of losing key elements in the hurry. Writing every problem and solution in a daily notebook with the date brings in the very technical EMOD factor. When you drive EMOD by injecting the psychological and intellectual perspective, your attitude, behaviour and action follow a marked functional benefit that aims for differentiation. In his/her first job, an employee is entrenched in family, societal and college culture which has to change to absorb long, addictive work hours in an enterprise. This work culture influences and seasons both professional and personal life. Today managers spend at least 10 hours a day at the workplace; his/her work starts to mirror the work environment. So it’s important to infuse human sensitivity into this culture as it drives employee enthusiasm for action, and their hawk eye for demanding and delivering quality.

In your competitive environment, define the unique attitude and behaviour your enterprise is based on. This will enable you to dovetail the action of employees for delivering sustainable, profitable business. In sum, the mechanical EMOD is driven by ABoArD that’s about your human capital absorbing change for better, intelligent, qualitative delivery.

To download above article in PDF Come ABoArD to track business

Financial Express link :http://www.financialexpress.com/news/come-aboard-to-track-business/828201/0

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