#39 - DECEMBER 2010 by CyberMedia (I) Ltd

ISSUE 3 / DECEMBER 10 VOL 4

`50

Narayana Murthy Journey To The Top

EMERGING ENTREPRENEUR

TECHCORNER

RECIPE OF SUCCESS

ESTHER LENNAERTS AND RADHA KAPOOR

IS VIRTUALIZATION FOR YOU?

HURDLES IN OUR PATH CAN HELP US FIND STRENGTH

DoIt Creation

92 pages 92 pages including including covercover

Dec 2010 VOLUME 4 | ISSUE 3

Cover Story: Building Global Organisations 51 To succeed and grow, entrepreneurs must stop playing God By Prof R Srinivasan

54 Happy customers only goal for world class organisations By Ravi Talluri

Case Study 57 Technologically devoid, operationally insurmountable: Mumbaiâ&#x20AC;&#x2122;s Dabbawalas

By Shinjini Ganguli

59 Taking cows to the cloud: Chitale Dairy

Journey to the Top

By Shradha Mohanty

60 Fostering quality education by Smartclass program: Educomp By Sharmila Das

Interview

Opportunity

62 Virender Kapoor : Leadership tips for being world class 51

32 NR Narayana Murthy Founder, Infosys Technologies

22 Pearl Farming: Bring Home the Precious By Shinjini Ganguli 40 Nutraceuticals: The Healthy Dose of Business By Sharmila Das 82 Online Classifieds: A Class Apart By Shradha Mohanty

84 Entrepreneurial Gurus at Work By NEN

22 59

DECEMBER 2010 | DARE.CO.IN

BOARD OF ADVISORS N R Narayanamurthy

Chief Mentor, Infosys

Kanwal Rekhi

Chairman, TiE

Romesh Wadhwani

Gururaj ‘Desh’ Deshpande Saurabh Srivastava

Chairman & President, Wadhwani Foundation

• Phone for the elderly

Chairman & MD, Biocon

R Gopalakrishnan

• Small server for small businesses

Executive Director, Tata Sons

Philip Anderson

Professor of Entrepreneurship, INSEAD

Abraham Mathew Prashanth Hebbar

• Bronchial Thermoplasty System

President Senior Editor

• Electric Delivery Truck

ANALYSTS Binesh Kutty Nimesh Sharma Sharmila Das Shinjini Ganguli Shradha Mohanty

Tech Corner

OPERATIONS Ajay Dhoundiyal Product Manager Prasanna Srivastava Product Manager Debabrata T Joshi Manager Events VIjay Rana Design Anil John Photography

72 Virtualization for Esther Lennaerts and Radha Kapoor

Emerging Entrepreneur SALES & MARKETING MA Jaideep Associate VP Mario Gabriel National Sales Manager Yogesh Bhosle West Ankur Kalia North Manas Mishra South Kingshuk Sircar South-East Asia

PRINT & CIRCULATION SERVICES Rachna Garga VP T Srirengan GM, Print Services Sudhir Arora Senior Manager Circulation Sarita Shridhar Assistant Manager, Reader Service

Printed and published by Pradeep Gupta. Owner, CyberMedia (India) Ltd. Printed at International Print-O-Pack Limited, B-204-206, Okhla Industrial Area, Phase 1, New Delhi-20 Published from D-74, Panchsheel Enclave, New Delhi-17. Editor: Krishna Kumar. Distributors in India: Mirchandani & Co., Mumbai. All rights reserved. No part of this publication may be reproduced by any means without prior written permission. BANGALORE 205, 2nd Floor, # 73, Shree Complex, St.Johns Road, Tel: 43412333 CHENNAI 5B, 6th Floor, Gemini Parsn Apts, 599 Mount Road, Tel: 28221712 KOLKATA 23/54, Gariahat Road, Ground Floor, Near South City College, Tel: 65250117 MUMBAI Road No 16, D 7/1 MIDC, Andheri (East) Tel: 42082222 DELHI D-74 Panchsheel Enclave Tel: 41751234 PUNE Flat No. 9, F Block, Popular Heights 3 Koregaon Park Tel: 65000996

The DoIt Creation is basically a holding company which has invested in Pressto and another venture called Brand Canvas. The vision is to invest in creative and premium business ventures and make them grow.

Strategy

CORPORATE OFFICE Cyber House, B-35, Sec 32, Gurgaon, NCR Delhi-122001 Tel: 0124-4822222, Fax: 2380694

92 pages including cover

DECEMBER 2010 | DARE.CO.IN

Growing Businesses By Anil Chopra

74 Virtualization At What Price By Amrita Premrajan

76 Virtualization Pitch By Patanjali Pahwa

Unwindings

20 Worklife: What will you leave for posterity? By Anurag Batra 26 Startup : The Two sides of Entrepreneurship By Vijay Anand 30 Make Life Easier. Well, Almost

86 On the Bookshelf 87 The Lounge 88 Review 89 What’s New?

By Rajaram Rajendran

36 Recipe of Success: Hurdles in our path can help us find strength By Shinjini Ganguli

38 Startup: Have It Neat! By Dr Hrishikesh Damle

42 Startup: The Journey itself is the Destination By Lakshmi Pratury

SECUNDERABAD #5,6 1st Floor, Srinath Commercial Complex, SD Road. Tel: 27841970 SINGAPORE 1, North Bridge Road, # 14-03 High Street Center Tel: +65-63369142

• Dust-free chalk

Chairman, Sycamore Networks

Chairman, Indian Venture Capital Association

Kiran Mazumdar Shaw

Innovation

Others 10 Feedback 12 Exchange 70 Statistics: Private Equity / Venture Capital Investments

Event 66 NASSCOM shows 64 Startup: The Changeover - Make it big and visible By Srikala Bhashyam 68 Startup: Want funding for your start-up? Tell a story! By Vimarsh Bajpai

the way

80 Headstart: November’s Startup Saturday

FROM THE EDITOR

Start-up Koans By Prashanth Hebbar

Letting go Letting go is not about giving up control it is about investing in an organization building a functional legitimacy The customer is still pampered but not by the entrepreneur himself instead by the organization Customer-centric Do you review customer satisfaction as often as you do revenue achievements If you keep forgetting to do this use Balance Score Card approach While researching for this issue’s cover story, I came across two gentlemen who seem to have come from another planet. They brought up two of the most important things every entrepreneur encounters and gave solutions which were so simple that you will almost laugh at it. The first one is about Letting Go. This is a theme brought up by Prof. R Srinivasan of IIM-Bangalore, who specializes in corporate strategy and enterprise growth. Prof Srini’s definition of letting go itself is a solution. It is like a zen story. Read the letting go koan at the beginning of this piece and ponder. The second issue was about customer-centricity brought out by Ravi Talluri, a Hyderabad-based entrepreneurship development consultant. Talluri brings up the stark reality of our businesses today where customer comes second and revenue growth first. If anyone says otherwise then we scoff at him saying: be practical.

Letting go is not giving up control. And discuss customer satisfaction in every review meeting

As we embarked upon the cover theme of: Building a World Class organization, we realised that there are only a few ground realities to getting there. The rest are part of the hype that we see in the world of business. So call it the fundamental theorems of entrepreneurship: Letting go is not giving up control. And discuss customer satisfaction in every review meeting. We included a Q&A with Virender Kapoor, author and management guru, who talks about the element of discipline. We thought it is an extremely important point to ignore Kapoor’s views. We have also included three case studies. One is a short recap on the famous Dabbawalas of Mumbai. This has been included to remind us that it doesn’t take an army of MBA-grads to implement a successful world class business model. Second one is on Chitale Dairy which shows that technology can bring in a difference to your offering and the third is about Educomp, a company that saw meteoric rise in a short time and ﬁred up a new category of edu-tech. It’s winter. This is the best time to huddle together and ponder over a few things we may have forgotten. Use this as a refresher and get back in great shape to build your world class organization. And do not forget to tell us how you did it.

It takes will and nothing else.

Interact with me on Twitter @phebbar DARE.CO.IN | DECEMBER 2010

FEEDBACK DARE- A wonderful site for us! Thanks, DARE, for such a wonderful site. It’s so helpful, neat, and solid; I love it. Also, I discovered it just when we are planning to start a profitable business in India after going back to India permanently from US in the next few months. Thanks again, and keep up the good work. - Chandrani

Madhya Pradesh is next to none for Emu Farming I am an avid reader of DARE since its inception. I also got an idea for my business from this magazine. It was your 3rd or 4th edition. We were the first in starting an emu farm in M.P, and now after a successful year along with my partners, I am setting up my own separate farm at Jabalpur with 30 emu pairs. I would like to get support and knowledge on how and what aid I can get from NABARD. Secondly, what is the procedure to get a loan under the CGTMSE scheme, if it’s available for emu farming? - Bawse Akshay, Jabalpur

A Workforce of One Dear Vijay I had gone through your article and appreciate the points except the ways and means of recovering of payments. Most of the time new entrepreneurs like me to gain market take up work without any advance and deliver the goods with a view that payment will come in due time.

READERS

website: www.dare.co.in, email: dare@cybermedia.co.in SMS: ‘DARE <your msg>’ to 56677

However the client fails to pay up and we entrepreneurs are in mess financially as well as mentally. Going legal way is time consuming and distressing particularly when you are in initial stage of startup. I am also a victim of bad debts and want to seek proper recourse and guidance. Kindly suggest a proper channel through whom the problem of recovery can be worked out. - Sanjay Adbol Response of Vijay Anand Read the article in the Dare October issue on Cashflow, by me. It can help you to some extent. I have mentioned that a) get an advance b) incentize people who pay on time and a few other tips to help. - Vijay Anand

Take your employees along for the transition Nowadays many companies pay the best of salaries but make the young generation work for 1216 hours. Many employees are required to work from 9 a.m. till midnight. This should be banned in India as the life span of fit working people is reduced to a great extent. Why don’t these companies employ more people and restrict maximum hours of working per person and let the employees enjoy both work and leisure? Leisure, too, is important to get the best results. By employing more employees the problem of unemployment shall be reduced as well. Working such long hours spoils family relations

and there is more chance of depression too. Also, there should be compulsory yoga /meditation in companies for employees to work in peace at their optimum levels! - Mahesh Kapasi

Mystery Shopping in India I have been working with many mystery shopping companies and I am very unhappy to see this kind of wrong publicity of the company. All the companies pay well and on time but when the shopper’s shop is cancelled or report is of not good quality then they send messages like above for Wemark. I have been always paid on time from Wemark and they give good shops. Some of the best companies in India for mystery shopping are Bare International, Wemark and Grass Roots. They all are very good. - Sarita Tyagi

Reality Check- Before You Invest, Before You Spend!!! This is indeed a good blog. It is encouraging those who want to be entrepreneurs! - Anuja

Collaboration For a Social Change We talk a lot about social change & keep on blaming government for the failure of this but we forget that what is required is our collaborative efforts by putting aside our personal egos which successfully brings about a drastic change in our society. - Rites, Kota

Reality Check - Before You Invest, Before You Spend!!! If you want to change a product in any way, you need private label rights (PLR). You can then customize the product or the content of the product and use it in a variety of ways. - Alliaha 10 DECEMBER 2010 | DARE.CO.IN

EXCHANGE

MARKET PLACE

• partners • mentoring • funding • guidance • advice • ideas...

Wastepaper recycling plant, Mr. K.P Bikal We have been dealing in wastepaper recycling technology and program since the last fifteen years at a very small and medium scale. If anybody is interested, we can support them by supplying cost-effective equipments, and with installation and training etc. - KP Bikal, Green Technologies Response I am interested in wastepaper recycling plant. - Atul Kumar

Looking for channel partners in India as well as other parts of the world We are a start-up private limited company located in Bangalore. We produce branded leather products as well as garments in a big way. We are looking for channel partners to expand our reach all over the world. Interested vendors and investors are welcome. - Atalofashion

Mentoring required for new ideas I am a working professional aspiring to be an entrepreneur, and basically on the lookout for new ideas. Just thought about these: 1) There are many upper middle class people who want to wear designer clothes but can’t afford them or have to hunt around for a good fashion designer. Was wondering if I could bring a few designers under one roof and provide affordable and customized designer wear for my target customers? Need some more ideas to refine this business model and some guidance on how I can go about this. 2) People spend an exorbitant amount of money on buying dresses and accessories for their marriage, most of which they never use. Can I bring in a model where I can buy them and rent it out? Is this a viable plan? - Unni Vidhya 12 DECEMBER 2010 | DARE.CO.IN

Submit exchange requests at: website: http://www.dare.co.in/ marketplace.htm OR email: dare@cybermedia.co.in, OR SMS ‘DARE <your msg>’ to 56677 OR twitter.com/daretostartup

Response I would like to contact him regarding this since my friend and me are into a similar business and looking forward to building a team for expansion to other territories. - Shreyas M

Starting a food venture in Gurgaon-Delhi-NCR

I conduct a 40-hour course on the Internet as an LVC—live virtual classroom. All you need is an Internet (256kbps or above) enabled PC with a headset to participate in an English medium of instruction. Ask for a free demo session today by sending me a mail. - Vijay Kumar Response Please give us details about the various programs that you run in the online or virtual classroom and send me your URL. - Chandra Pratap Singh

I am a BITS-Pilani, Goa Campus (2005-09) graduate. I have always been passionate about food and running my own business. I am starting a food venture in Gurgaon-Delhi-NCR (declining an offer from Symantec). As a firsttime entrepreneur, I am facing various issues and will continue to encounter such issues as I grow. As of now, I am facing an uphill task of finding a good team. I have done all the groundwork in the last few weeks and need at least one more member who is equally passionate for food and a career in this field. I have planned to launch the venture in the next two to three weeks. Looking for people interested in the venture. - Sumit Agarwal Response I am interested in food business. Kindly contact me so that can initiate a conversation. - Ahmed Shaizad

Need bambino sticks making machine for agarbattis

Need Co-Founders/ Partners in a Service Industry Start-up

Participate in English medium online instruction portal

I need bambino sticks making machine for the agarbatti industry. Please send details. - N.P. Rao, Warangal, AP

Information from China

We are looking for young, dynamic co-founders/partners for a servicebased start-up. The business potential and scalability is huge.

rt an imp needed to sta

ort business

to ics industry dian electron g In in e rt th po in im er siness of g enough play y t my own bu an ar g st in I am not a bi to rt t po an e in im es, but I w no knowledg Could you invest in cror China. I have rt duty, etc. om po fr im ts e uc lik s ie ac ic tr solar prod in its associated product and e process? - C L Joshi e through th m e id gu se plea t where to star I don’t know t bu d n in ca m e y Response w in m aybe ilar thought ired for it. M ion I have a sim rmation requ fo any informat in t e ge th I l If al d. ve el fi ha t is n n’ th io do at in and ething y inform er to do som if you get an to ow er kn th e m ge t come togeth le ething to know. Please e can do som w re tu I will let you fu e maybe in th Kolkata as well. Also, - Chandrani, . it nd pa ex

EXCHANGE

MARKET PLACE

• partners • mentoring • funding • guidance • advice • ideas...

We would prefer it if the individual is based in Bangalore (since we are aiming to start a pilot here). The business offering is very unique and has a huge potential as it addresses a basic need in today’s life. We are looking at building a very strong team. - Sharath Vatsa, Bangalore

Opportunity that is redefining success Want to start a business but not by yourself? How about being in business with a company that has a solid 16 year history and a revolutionary product that is changing the face of communication? You can be a part of it — the time is now. Contact me for any questions. - ACN Inc, Representative Sponsor Rep ID 02211044

IT platform available to do IT / ITES business in Saudi Arabia Our company Bathik Technologies, registered under the foreign investment license in Saudi Arabia, invites Indian IT companies that want to start up their marketing and operations in Saudi Arabia. As the economy is booming, the scope of business in IT is high. We can provide our existing platform for IT & ITES companies on agreed

Submit exchange requests at: website: http://www.dare.co.in/ marketplace.htm OR email: dare@cybermedia.co.in, OR SMS ‘DARE <your msg>’ to 56677 OR twitter.com/daretostartup

terms and conditions. You can market software, networking, digital signage, RFID, LED solutions, or customized solutions through our channel; basically, any technology-based services and solutions. Please note that we only have an Indian owner as signatory authority. It’s easy and safe for the firms who want to invest in Saudi Arabia under our platform. Please email me your company profile. We will provide you further details upon reviews. - Ismail, Bathik Technologies Co., KSA

Seeking Fund for ongoing Agricultural Project Our company provides technology-based projects in Saudi Arabia and are registered under the foreign investment license. Our company owner is from Kerala, India. We are looking for project funding in order to balance working capital for our ongoing agriculture project. It is an organic bio-fertilizer plant project and technology transfer from Spain. Investment range: 5 to 10 crores. Annual profit: 22 to 24 % Interested parties can email me. - Ismail, Bathik Technologies Co., Riyadh, KSA

Guidance and support needed for a project related to banks I am presently working (business planning) on my brainchild related to banks, which is completely unique in its functions compared to the traditional banks and does not exist in India yet. I am looking for a mentor who could assist me in executing my beautiful and practical plan. I’m eagerly looking for guidance and support. - SP Guruprasad Response We are an IT company in Saudi Arabia. Please let us know whether your project is viable in Middle East countries. If it is a technologybased solution, we are interested in knowing more about it. - Ismail Kalathingal

14 DECEMBER 2010 | DARE.CO.IN

Tire Recycling Interested in Partnership I am interested in starting a waste tire recycling plant in Nagpur. Anyone interested in joining hands in this venture is most welcome and can get in touch with me through email or can just call me. - Tushar Padgilwar Response I am regular reader of DARE magazine. I am interested in knowing more about the tire recycling plant, which was published by Tushar Padgilwar of Nagpur, in the October ?10 exchange column. Please mail me his mail ID or mobile number. - Narresh, Hyderabad

Looking for partners for an innovative business I am a BHU PGDM 2010 pass out. I am looking for partners for an innovative business venture. I have previously worked in both the IT and financial domains. The business aims to enter the services market with a twist in the idea; something which has not been attended to until date. The business aims to help companies or teams achieve their deadlines by providing them the required support. In turn, they will be charged for the service provided. Interested people can contact me on my number. As the business idea is unique, I would be maintaining confidentiality on certain levels of involvement. You can be from diverse backgrounds. The diversity would only make the services more diverse! - Shwetha Ramnath

Keen to start a vocational training center for disabled people and exservicemen I have been working in the development sector in the area of sustainable livelihood for the last 15 years in Madhya Pradesh with a long term presence in Mandla

EXCHANGE

MARKET PLACE

• partners • mentoring • funding • guidance • advice • ideas...

(130 villages) and Bhopal city slums. We have a federation of 165 NGOs in Madhya Pradesh and have a close network of more than 45 like-minded NGOs. We are keen to set up a vocational training center for people with disability, and for ex-serviceman, leading to employment in corporate sector or self-employment. We are looking for experts, partners, ideas, advice, and mentors on the subject to proceed further. - V.P. Singh Response I am interested in your project and also share your thoughts and views. I think I can be of great help if you can contact me on my cell or e-mail me. - Krishna Murthy

Want to start an all graphics and web solutions company for corporations and small businesses I am an independent web and graphics consultant. I bought my first DARE magazine recently from the stalls, and it was like landing on a treasure island! I left my job a year back to venture into my own business. I have been working in various setups related to graphics and animation for the past seven years. I am very confident about my professional as well as business skills. I want to start an all graphics and web solutions company for corporations and small businesses. But unlike most of the firms, I want to focus on local businesses to begin with. I have read about the friends, family and fools funding, which is unfortunately unavailable to me. Can the Angel Network help me with my venture? - Ashutosh Naik Response Please email me your project and investment plans. Let’s see how we can work. - Vijay Sanghvi

16 DECEMBER 2010 | DARE.CO.IN

Submit exchange requests at: website: http://www.dare.co.in/ marketplace.htm OR email: dare@cybermedia.co.in, OR SMS ‘DARE <your msg>’ to 56677 OR twitter.com/daretostartup

Interested in starting a fish farming business I am interested in fish farming. Since I am a fresher, I am looking for people who can guide me. - Manish Chandra Response Let me know where you are located and about the availability of fish. - Surjya Sahoo

Parents Community for Help on Nursery School Admissions I would like to contact Mr. Raj Arora for nursery admissions. - Atul Kumar Kashyap

Want to meet buyers from abroad for an art gallery in Chennai I am a regular reader of DARE since the first issue, and I find it the most useful for budding entrepreneurs. I am into the art business and have a gallery where eminent artists contribute their arts. I have already found a buyer in London. I want to contact somebody who can help get buyers from abroad. - Lakshman I am from Malaysia and at present in Chennai. I am into selling photo-art to collectors and interested individuals. Please feel free to email me and we shall discuss all the possibilities. Wish you all the very best. - Anand, Founder, Anandz Photography

Looking for partner to start up fruit juice related business like CCD I am looking for a partner to start a business of organized retail chains providing different varieties of fresh fruit juices. This concept is based on the CCD model. With more and more people becoming health conscious, I think this business will definitely do well. Please contact me if you believe in the idea. - Amit Dahal, Kolkata

A lucrative business proposal that could breakeven in the first year itself I have a business proposal that could breakeven in the first year itself, and there is an ever expanding market readily available for the services. I am looking for funds to the tune of Rs.50,00,000-1,00,00,000. The project will give an assured return of 20% in the first year and 25% in the next consecutive years. I am looking at an exit option of buying back the shares at 250% of face value. Minimum investment period is 2 years. - Deepak Bijaya Padhi Response Can you mail me your proposal, please? - Vijay Sanghvi Contact Me. - Navin Sharma

Chain of fresh fruit juice bars Last year, I had set up a chain of fresh fruit juice outlets in Gurgaon offering roadside products like sugarcane juice, coconut water, orange juice, and fresh lime soda in the most hygienic manner and with the use of innovative juice extraction machines. My investment banking job is taking me to a different city. Thus, I want to sell off the business/ machines. Please contact me. - Ashish Parnami

Anything is possible. Even those dreams that you may have had as a kid, but decided were too lofty or were unrealistic. With hard work, passion and tenacity, we can create the future we imagine for ourselves.

Entrepreneurs’ Week Dec 13 – Dec 17, 2010 www.dare.co.in/eweek What can you do on Entrepreneurs’ Week? 1. Network With Others. You can connect with other like-minded entrepreneurs between 4pm – 4.45pm (IST) and listen to a prominent entrepreneur who has crossed the Rubicon in a webinar. Visit http://www.dare.co.in/eweek and register today. 2. Show Your Gratitude. In the past couple of decades, a slew of new and fearless entrepreneurs have emerged and have brought a sea-change in our economy, from a slow-paced to a burgeoning one. If you know any of these path-breakers, thank them. And if you are one of them, take the opportunity of thanking all those who have helped you give shape to your dream. 3. Be A Mentor. Do you recall that one person who constantly pushed you to start your ﬁrst business or helped you bring your ﬁrst big idea to life? If you do, join us and return the favour. Find an aspiring entrepreneur, who you can mentor through all times, good or bad. Happy entrepreneurs’ week everyone and do spread the word! Login to dare.co.in/mentors to register yourself.

EXCHANGE

MARKET PLACE

• partners • mentoring • funding • guidance • advice • ideas...

Set up your own health food empire at a very affordable cost I did a trial run of a soya milk plant in Bangalore, India. It was successful and it has a pre-defined market among educated mass; though not a huge market, but it’s growing slowly. The company will be completely yours; it will not be a franchise. It’s purely a solution being provided by us. We are a group of engineering graduates and we do a lot of things that relate to good health and a healthy future. You can also make biscuits from the by-products and it will be a healthy biscuit, full of fiber. In our solution we will be doing the following things: 1. Provide the machines 2 Establish the market 3. Help you diversify your business 4. Give you a website for online sales with complete SEO Few facts to justify why soya milk: 1. It’s full of pure vegan protein. 2. In India, diabetic patients are growing exponentially. And soymilk is the best remedy for them since it is cholesterol and fat free, and the fiber in it helps maintain blood sugar. 3. Only 2-3 players currently deal in soya milk, so the competition is less. - Acharya Hara Kumar, Bangalore

Jute Diversified Products: A Golden Opportunity My company’s name is Ecotiative. It’s a social enterprise involving a section of marginalized people. We manufacture jute bags, cotton bags, and canvas bags under the brand name GreenCarry. We market it through retail outlets/ shopping malls as well as in fairs and exhibitions. We are thinking of exporting it right now to the US, UK, Canada, Germany, Australia, NZ, Holland, UAE, Singapore, etc. We need someone energetic and committed who is interested in working as a marketing agent (on 18 DECEMBER 2010 | DARE.CO.IN

Submit exchange requests at: website: http://www.dare.co.in/ marketplace.htm OR email: dare@cybermedia.co.in, OR SMS ‘DARE <your msg>’ to 56677 OR twitter.com/daretostartup

Men’s garment business requires partners and investors We have a business in the men’s garment section that has a very good growth potential. We are distributing our franchise across India. You can visit our website at temperaturezero.com. We are interested in contacting franchisers as well as investors. - Vikram Singh Response Already running a start-up called ABSOLUT ZERO dealing in T-shirts and accessories. I’m not interested in a franchisee, but is there any other way we can associate? - Sukrit Gupta

commission basis) on behalf of our company in the overseas market. We are looking for small quantity orders for now (500 – 2000pcs). Anybody interested in helping us out with overcoming this battle, please revert. - Amit Pal

Farming for Caviar I have a space suitable for every kind of fish production, which is eventually for scampi farming in India. I am really interested in expanding my business to higher level. Please suggest some ways. Partners are also welcome. Contact via email. - Mehboob Kairali

Seeking a mentor for a rural/agriculture sector service related idea I am looking for mentoring and guidance for implementing some of my ideas related to rural/agricultural services sector. It involves little bit of technology and strong alliances building. I can conceptualize and implement the whole idea, but I need somebody who can guide me/ help me in alliance building. Can somebody help me or professionally join with me to build a brand? - Sandip Response Please let me know the details of the project you are planning in agriculture. We are already

doing something with Israeli technology. We need to understand what you are doing so I can discuss further. - Asif

People needed for opportunities between South Africa and India We are an Indian company looking for trading opportunities between South Africa and India. Product line is not yet not decided, and we are currently conducting surveys. Interested parties may contact. - Rana Jitendra Singh Response We are manufactures of LED photo-therapy unit and other equipments used for Neonatal ICU (hospital equipments). We are interested in your venture. Please let me know your details. - Sujith S Ibis Medical Equipments & Systems, Ernakulam, Kerala

How to get private equity We are a company engaged in the manufacturing of prescription optical lenses. Our industry has witnessed a growth of 30% year on year, and we need funding from investors for expansion. We have a very good project in hand and would require funding for it. If any of you might be interested in discussing this further please feel free to contact me on email. We can assure a profit of 25% atleast.

STRATEGY

WORKLIFE

What will you leave for posterity? Creating a business today is a relatively simple task, but creating an institution that is an inspiration for future generations is more difficult would really like to begin my article this time by asking you all a question: ‘Who are the Indian entrepreneurs whose story inspires you the most?’ I cannot be a 100 per cent sure what will run through your mind on hearing this question, but I am quite confident that most of you will have at least any one of J.R.D. Tata or N.R. Narayana Murthy or Dhirubhai Ambani or Laxmi Mittal or Kishore Biyani or Kiran Mazumdar Shaw or Azim Premji or Sunil Mittal on your list, if not all! Have you ever thought of what is the one thing that is common to all of them? Apart from the fact that all of these are first generation entrepreneurs and built their businesses from scratch, they have all built businesses that will live forever — long after they themselves have gone. More than building businesses, they have actually built institutions, which will benefit not only their own families, but also a whole lot of other people. They are leaving an inheritance not only of money, but of values, aspirations and goals! But when I go to various entrepreneur forums today and see the buzz that the word, ‘entrepreneurship’, has created, I sometimes wonder if the

20 DECEMBER 2010 | DARE.CO.IN

entrepreneurs of today ever think of leaving behind an inheritance? In today’s time, when creating a business is as simple as building a website, does the idea of inheritance, legacy, values even cross the young generation’s mind? Do they ever think about building businesses that will last forever? I strongly feel that they do not! With the idea of inheritance also comes a very basic, but pertinent, idea: ‘Will my children fol-

But are we talking just about inheritance in terms of money here? No. I am also worried about the aspect of inheritance that involves the thought of ownership, of values, of a sense of belonging low in my footsteps? Will they take care of what I am creating today?’ I still remember our times, when it was quite natural for a child to choose a profession similar to that of his/her father. Options were limited and, thus, it was an obvious choice to become an engineer if your father was an engineer, or a businessman if your dad ran his own business. But in this ever changing, fast moving world, when opinions are formed and choices are made as young as five years, is it easy for entrepreneurs to make their kids follow in their footsteps? According to a research study detailed in the book, Entrepreneurship: Theory, Process and Practice, by Donald F. Kuratko, many privately held ﬁrms cease to exist after ten years, and only three out of ten survive into a second generation. More importantly, only 16 per cent of all privately held enterprises make it to a third generation! But are we talking just about inheritance in terms of money here? No. I am also worried about the aspect of inheritance that involves the thought of ownership, of values, of a sense of belonging. This quote by Benjamin Disraeli sums up my idea about inheritance: "The legacy of heroes is the memory of a great name and the inheritance of a great example." Do entrepreneurs ever wonder whether the people who are running the business with them right now will run it with the same passion and dedication once they are gone? Do they own the business? Do they feel that they are a part of it? A successful entrepreneur, who is also a very good friend, once told me that hiring a professional manager is always a more sound business decision than hiring a family manager. That’s because you can’t ﬁre a

Anurag Batra

family manager even if they don’t have a sense of belonging to ‘your dream, your ideas!’ I remember when ‘I’ and ‘we’ started; ‘my’ and ‘our’ ideas of Exchange4media were different. The plan which ‘I’ and ‘we’ had was much ahead of time and space and, thus, it did not work out. But we were quite open to adapting our plans and Exchange4media today stands as a leader in its space. I accept that none of us ever thought about the idea of inheritance — probably, we were too busy creating and running the show! Today, when we have completed ten years in this ever growing and extremely competitive market, where we have seen competition rising every year, I feel we have contributed through our business and have created a unique space for ourselves, which people would like to own and run in the future. I am not sure if my son and daughter would though! I think one should think about all these ideas to build businesses that are immortal and go beyond personal identities. Only then will our future generations remember the names of the entrepreneurs of today. Otherwise, only the legacy of the Tatas, Ambanis and Jindals will be recalled forever! ‘Sometimes the poorest man leaves his children the richest inheritance.’

Anurag Batra is real life, ﬁrst-generation entrepreneur who is Much Below Average (MBA) from the prestigious Management Development Institute, MDI. When he is not busy writing such columns, he can be reached at anuragbatrayo@gmail.com. Anurag is the founder and editor-in-chief of exchange4media group which includes exchange4media.com. To write to the author, please send an email to dare@cybermedia.co.in with the subject line 'Anurag Batra'. Disclaimer: The views expressed here are that of the author and do not represent the magazine's.

DARE.CO.IN | DECEMBER 2010

OPPORTUNITY

PEARL FARMING

Bring Home The Precious! Freshwater pearl farming is a profitable venture that can reap up to 200 per cent profit with no tax deductions. Anyone interested? Read on to know about various aspects of pearl farming. By Shinjini Ganguli

22 DECEMBER 2010 | DARE.CO.IN

earl farming, a lesser known practice, but certainly a lucrative business, unfortunately, hasn’t caught the fancy of Indian entrepreneurs as yet. Predominatly so, due to lack of awareness and technology. In the absence of any takers willing to breathe life into the pearl producing oysters, India, which was once known to produce the ﬁnest ‘oriental pearls’, imports pearls worth $ 4 million every year now. After pearl fishery was stopped in India four decades ago, as a step to put a check on the depleting resources of natural pearls, production of pearl came to an apparent halt while countries like China, Japan, Australia, Tahiti and Indonesia, the biggest producers and exporters of pearl, took to pearl culture in a big way. In fact, pearl culture is one of the main cultivations in China and Japan. Of late, the practice of freshwater pearl farming has been gaining belated acceptance in India. A few have come up on the horizon. And leading the pack is, Ravikiran Bhatt, a pearl farmer and the only pearl consultant in India, from Malavalli, a village in north Karnataka. He ventured into this business

three years back and was the only pearl farmer in the whole of Karnataka back then. “In three years I have come a long way. From a farmer to a consultant, I have a client base of 28 clients across several states of India and foreign countries like Maldives, Malaysia, Singapore, etc.” Ravikiran, Chairman, Ravikiran’s Freshwater Pearl Culture Research Centre and Yashas Consulting Services, accidently landed up in this business when an astrologer told him that pearl farming could open the doors to fortune for him. Enthused by the astrologer’s prediction, he went to China to learn the technique of pearl farming. He got his degree in MFSc in pearl farming, from the Freshwater Fisheries Research Center CAFS (FFRC), Wuxi, Jiangsu, China. He also visited the Central (CIFA), Bhubaneshwar and the Central Marine Fisheries Research Institute (CMFRI), Kochi and got the necessary training from experts. Additionally, he gathered information from the internet and gained knowledge on various methods of pearl cultivation in detail. With all the information in his kitty, he started experimenting. And after a couple of failed attempts he

“In three years I have come a long way. From a farmer to a consultant, I have a client base of 28 clients across several states of India and foreign countries like Maldives, Malaysia, Singapore, etc.” Ravikiran, Chairman Ravikiran’s Freshwater Pearl Culture Research Centre

finally tasted the long-awaited success. Today, he is sitting pretty on an annual turnover of Rs 40 crores, which is a magnificient figure considering he started with just Rs 4 lakh three years back. For the figures it generates, freshwater pearl farming involves a relatively simple procedure that can be easily replicated by anyone, anywhere. The biggest advantage being that entrepreneurs can start this even within the territories of their houses.

Replicating Nature A natural pearl is formed when some form of irritant lodges itself into a mussel (freshwater oyster). To protect itself from the irritant, the mussel secretes a fluid to coat the foreign element. And over a period of few months or a year or two, layers of coating are formed on the irritant and thus a lustrous pearl is formed. Pearl is basically calcium carbonate deposit within the soft tissue of shelled oyster. DARE.CO.IN | DECEMBER 2010

OPPORTUNITY

PEARL FARMING

Life Cycle Here’s an example demonstrating the various stages of pearl farming and corresponding costs involved for a project with a minimum budget of apprx. Rs 7 lakh. Such a project can yeild upto Rs 12-15 lakh with a mortality rate of 50 per cent. STAGE 1 PURCHASE OF LAND WITH WATER RESOURCE A piece of land (0.25 to 0.5 acre) Apprx. - Rs 2,00,000

STAGE 5 PRE-OPERATIVE CARE SURGERY POST-OPERATIVE CARE **Involves no cost apart from labour cost

STAGE 3 POND CONSTRUCTION Apprx. Rs 1,00,000

STAGE 2 PURCHASE OF RAW MATERIAL Nuclues – Apprx. Rs 2,00,000 (5 kg. x Rs 40,000) Surgical tools - Apprx. Rs 30,000 Total - Rs 2,50,000

However, pearl formation procedure is different in cultured pearls. In freshwater pearl farming, mussels are nucleated through surgery which initiates the process of pearl formation. The process starts with collecting mussels from river, which are then put under pre-operative care to help the mussels adapt to the new environment. The mussels are then operated upon and nucleus is implanted between its soft tissue. Subsequent to the surgery, mussels are put under post-operative care, also called the ICU stage. Post recovery, mussels are put in a pond, where they are tended to while pearls take shape inside the shell. Depending on the type of mussel, pearl formation can take anywhere between a few months and several years. The last stage comprises harvesting pearls. Pearls are extracted from the mussels, which are washed, cleaned and certiﬁed by gemmologists before they are sold.

Elements of concern Erratic or extreme climatic condi24 DECEMBER 2010 | DARE.CO.IN

STAGE 4 LAB SETUP Apprx Rs. 30,000 Oyster CollectionApprx Rs. 20,000 Total - Rs 50,000

tions-Mussels could perish under extreme weather conditions. Untimely rains could destroy the pearl breeding mussels. Depleting quality of water- Due to increase in the number of industries and industrial waste which is often dumped in the water bodies without proper treatment, the water quality is depleting. Unsupportive Banks- Despite the fact that pearl farming comes under agriculture, banks do not provide loan for pearl farming. And it is always a challenge for a farmer or an entrepreneur to procure loan for the same. Marketing Obstacle- This is one of the most crucial challenges faced by a farmer. The domestic market is mostly consumed by artiﬁcial hyderabadi pearls, which makes it difficult of an entrepreneur to sell his cultured-pearls in the country. Pearls produced in India have to be thus exported. But again, there are no middlemen in India for exporting the produce. “Government should establish agencies to help pearl farmers market their pearls,” says Ravikiran, who helps farmers to market their pearls in the absence

of any proper marketing chain. Technologically outdated- Technology is very crucial to pearl farming, as it helps in improving the quality and increasing the size of the pearl, which in turn helps fetch better price for the nugget. But, unfortunately, India lags far behind in pearl farming technology. “Central Institute of Freshwater Aquaculture, premier research Institute on freshwater aquaculture in the country, has been trying to develop world-class technology for pearl production which can help farmers, but hadn’t had much luck,” says Mr Suresh Kumar, a pearl farmer from Bangalore. Lack of technology and unawareness about the existing technology is the reason why entrepreneurs often give up on the idea of pearl farming.

Investing in the Invaluable Cultivation of pearls involves capital investment and recurring expenditure. While capital expenditure includes buying or taking a land on lease, constructing a pond, plant and machinery, etc, recurring expenditure entail buying nuclei, which is generally imported from

STAGE 9 SALE Sale Proceeds Rs 12 to Rs 15 lakh

STAGE 7 HARVESTING AND CLEANING PEARL **Labour Cost ***Miscellaneous expenses

STAGE 8 PEARL MARKETING There are no expenses involved in this stage apart from getting pearls certiﬁed from a gemologists which costs between Rs 10,000Rs. 15,000 The entire process of pearl cultivation starting from mussel collection to pearl harvesting, takes upto 15 months

STAGE 6 DEPOSIT OYSTER IN THE POND **Labour cost ***Miscellaneous expenses

• Land

• Building and civil works: (Cutting ponds / tanks, bunds, feeder canals, drains, sheds, generator rooms, pump house, inlets/outlets, diffuser tanks, office building, water intake system, internal approach roads) • Plant and machinery: Motors, Generators, Iron stands, Fibre cages, • Vehicles • Technical know-how fees

RECURRING EXPENDITURE

CAPITAL INVESTMENT

• Land and site development:clearing, leveling, fencing

• Cost of seed, feed and nuclei • Surgery charges • Harvesting charges • Fuel/electricity charges • Repair and maintenance of plant and machinery • Maintenance of civil works, staff salaries, • Administrative expenses

• Deposit for electricity

• Processing charges

• Construction

• Laboratory equipments

Japan, labour charges, harvesting charges, etc.

Deciding Factor (ROI) Pearl farmers can get as much as 200 per cent return on their investment depending on the survival rate of mussels. Ravikiran says, “In India the survival rate of oysters, under most favourable conditions, is as good as 80%. But to be on the safer side, it is better to go with the assumption that 50 per cent of mus-

sels may not survive till the end.” However, as long as the mortality rate is less than 50 per cent, one can expect to make approximately 200 per cent of net proﬁt. Which is not bad at all! But what makes the business of shiney pearls super-attractive is the fact that pearl farming is exempted from tax as it falls under the agriculture sector. This essentially means farmers needn’t pay any tax on their sale proceeds. However,

**A total of Rs 30,000 will be spent on labour wages over the total period. ***A total of Rs 50,000 will be spent on miscellaneous expenses over the total period. *Electricity expenses could go up to as high as Rs 20,000.

the government does impose tax on export of pearls. Pearl farming, despite being a commercially viable and profitable business venture, farmers aren’t coming forward. Ravikiran explain’s, “the reason why not many farmers are taking up pearl farming is because it is not supported by government. This makes it risky.” According to him, our poor farmers are apprehensive as, in the absence of government’s support, they don’t have anyone to fall back on in case the project fails. He stresses that the government should make loans easily available to aspiring pearl farmers and should as well start a training institute to impart training to the hugely illiterate population of farmers on techniques and technology. By promoting pearl culture, not only can the government play an instrumental role in uplifting the financial condition of the pearl farmers, given the high profit margin in the business, it can also help increase “India’s contribution to global pearl production which in today’s date is less than a per cent” says Ravikiran. DARE.CO.IN | DECEMBER 2010

STRATEGY

STARTUP

The Two sides of Entrepreneurship After decades of futile discussions and discourses, the question in the not-so-enterprising minds remains the same — entrepreneurship, an innate quality or could it be acquired?

he battle rages on. Are entrepreneurs made, or are entrepreneurs born? Quite honestly, I think the entire debate is overrated. Entrepreneurs are those who are known for their tendencies of wanting to stand out, and hate to be clubbed as part of a tribe, or class of people. And if that’s the logic we are going by, those who argue on identity aren’t quite representing the original variety of the same. But that too is a rather rash standpoint. Please don’t send me hate mails yet. Let’s take the case of starting out — There are two phases that every entrepreneur goes through — the chaotic phase and the execution phase. Ideas are born out of chaos. You have to get a mental image of a quarry where there is nothing but dust and rubble all around, and you just happen to come up or stumble across something worth shaping, sharpening and polishing. Lo and behold, an idea is born. The crux of this process is that idea generation is all about breaking patterns. Ignore all the whatifs and buts, and just think as a crazy person’s mind would think. Logic and rationale could park themselves out of the room for the moment. Then comes the next step, as the pitch gets ready — execution. People often ask me if entrepreneurs need a formal education and whether it helps at all. While some people are born and raised with naturalistic tendencies to do certain things a certain way (education, after all, is just a template of best practices), most others could use some help. Those who are naturally inclined will ﬁnd the process too boring and smothering and will drop out of the molding process and start the race early; but not everyone who drops out and starts early makes it.

26 DECEMBER 2010 | DARE.CO.IN

Entrepreneurs are those who are known for their tendencies of wanting to stand out and hate to be clubbed as part of a tribe or class of people.

Formal education, however, has its perks. It especially comes in handy when the execution bit starts to play out. The idea has to spread beyond just the mind of the founder — rationale and behavioral elements start to make their play as the team starts to form and it becomes a crucial element to unite everyone in the vision of what is being built. People who have gone through an education or training usually posess the ability to communicate and build up that vision in a fast paced manner. Those who haven’t but are born with talent simply deﬁne their own culture — not something that everyone can do. There are too many people who fall in between the cracks and perish during this process. If you look at what happens at the ideation stage though, the process is the same as any creative artist; where something is created virtually out of nowhere and probably resembles the act of the creator in ways more than one. Perhaps, that’s where the ego gets built. But most simply can’t proceed beyond that. It can be a high to come up with new ideas but without execution, it really doesn’t make a difference. One could walk up to a person who has built a successful venture through years of hard work and talk about how once they too came up with an idea like that but any reaction more than “So what?” is giving it too much credit. There is further segregation of this ideation phase. There are folks who can deﬁne a radical new concept and then there are those who can streamline and op-

Vijay Anand

timize processes. People who have been in the industry, seen enough of what goes on, and have comprehended the intention behind it all, can in a lot of ways, propose ideas and solutions that will optimize things to become more efficient. They too could be entrepreneurs, right? So, what then is the advantage that a naturally born has over a trained one? Not much, really. The fact is that humans, being what we are with our new and radical ideas and our lure towards it, naturally tend to praise off-beat and novel ideas, without giving much credit to what in most cases truly makes the world go round. One set of folks push the boundaries of creation, the other make what exists into better performing assets and machines. Both are equally important. I’d still come back to the original premise: An entrepreneur seeking identity in a word might be at a misplaced comfort zone. The word by itself doesn’t mean much — just that it denotes a person treading into a rather new territory or activity, and standing against the odds. Entrepreneurship just happened to be the trend of the season, very soon enough terms like activists, artists, and revolutionaries might replace it — just like innovators and inventors were adored past season. If you ask me, don’t get stuck up with what you are called, focus more on what you are to be doing — thats how legacies are built. Vijay Anand is a serial entrepreneur, the founder of Proto.in, and the Vice President (Incubation) at IIT's RTBI. He tweets at @vijayanands. To write to the author, please send an email to dare@cybermedia.co.in with the subject line 'Vijay Anand'. DISCLAIMER: The views expressed here are that of the author and do not represent the magazine's.

DARE.CO.IN | DECEMBER 2010

INNOVATION

SECTOR

A dust-free chalk for teachers Despite the presence of whiteboard spirit-based markers, chalks and blackboards are still the most widely used teaching tools with gypsum chalks being used in most municipal schools in India. Partho Ghosh, director, Central Salt and Marine Chemicals Research Institute (CSMCRI), started a project to create a clean chalk and a suitable duster in 2002. The machine that produces the dust-free chalk works on the hydraulic principle of mechanics. Following the initial set up, at a cost of Rs.6,00,000-7,00,000, the machine produces 400 chalk sticks per 15 minutes. Currently, CSMCRI’s “clean-write” chalk costs around 40 paise during production, though it is available to people at 50 to 60 paise per chalk piece.

MASS APPEAL The dust-free chalk from CSMCRI can give thousands of teachers respite from the white just that they inhale while writing on blackboards with chalks.

Phone for the elderly Munoth Communication, a Chennai based company, has designed a cell phone especially for the aged. The product named Munoth S5 has a large keypad and a voice prompt for easy dialing. Once the phone is bought, the user is required to register on a medical records website developed by Munoth Communication and ﬁll in details of their personal medical history like allergies, diseases, ailments and more, along with a photograph and information about a few close relatives. This is done so that a person’s information can be easily accessible in case of an emergency.

HELP AT HAND Munoth S5 is equipped with services and alert functions which could help the elderly keep track of their health and send SOS messages in emergency.

Small server for small businesses Technology company Hewlett-Packard has launched the ProLiant MicroServer, a small server for micro and small businesses. The server, designed for companies with less than 10 employees, enables users to share and secure critical business information. The MicroServer is compact and sleek and consumes up to 150 watts lesser than other entrylevel servers. The server promises faster access to shared ﬁles, applications, and increased system performance with expandable, pluggable drives, and ﬂexible backup options. Product: HP ProLiant MicroServer, Cost: Rs 25,000, Availability: Now, Source: www.hp.com, Company: HP

28 DECEMBER 2010 | DARE.CO.IN

Zapping Asthma Patients who have asthma that is not controlled by drugs may beneﬁt from the U.S. Food and Drug Administration’s approval of the Alair medical device. It uses a catheter with an expanding tip made of four electrodes. When inserted in a lung passageway by a medical professional, these electrodes deliver radio-frequency energy, destroying some of the smooth muscle tissue responsible for restricting the ﬂow of air during an asthma attack. Product: Alair Bronchial Thermoplasty System, Cost: Not available, Availability: Now, Source: www.btforasthma.com

Electric Delivery The eStar was designed from the chassis up as an electric vehicle for use in the cities. Intended to replace fossil-fuelpowered trucks for things like package deliveries, it can haul up to 1,800 kilograms. The truck features a battery pack that can be swapped out in 20 minutes; a fully charged pack will let the eStar travel up to 161 kilometers. Product: eStar Truck, Cost: Rs Under $ 150,000, Availability: Now, Source: www. estar.com, Company: Navistar

Content generated from

DARE.CO.IN | DECEMBER 2010

STRATEGY

WORKLIFE

Make life easier. Well, almost. Devices, software, and other stuff that help you spend lesser time at the desk

o yea, who doesn’t like to have some free time. I use some things to save myself from being eaten up by the computer screen. Hope you ﬁnd this useful in some way, and if you actually manage to save time, use it to e-mail DARE about it. lol. It’s been gadget mania of late. You already own an iPad, don’t you? Gotcha! Alright, if you do, then you already know what reading and workin on the go is like. Smartphones, of course, everyone has a blackberry. But apart from being typecasted, (who cares about those kind of stuff anyway) we’ve to agree that these actually save time. The only problem is, we use the saved time to to do more stuff on the computer and less at real life. Well that one, we’ve to ﬁgure it out ourselves. I use an android phone, and if you happen to have one, try the mindmapping software. It’s free, it’s great, and it’s called thinking space. You’ll be surprised at how organised things can get. Simple as well. androlib.com is a great resource. Try this app called Slidescreen. Saves you from even going to apps. Same with the iphone. Get language translators. Heck, the phone even reads things out for you. Remember that the next

30 DECEMBER 2010 | DARE.CO.IN

time you travel. There are free ftp apps that let you upload the new changes to your website on the go. No need to find a computer and transfer files. I use voice recorders to save that ‘flash-in-the-head’ ideas I get every now and then, which I totally forget later otherwise. Get Twitter apps, but I’ve to say I’m overloaded with information sometimes, and I do turn that off. Use Google maps, or GPS, know your route before you start driving. The time you spend waiting in traffic blocks, relax and listen to a podcast. Or let your phone download mails and have a conversation with your driver. Let’s not forget human beings, right. If you’re on a Mac, try Curio. You can download a trial, and it really doesn’t cost much. Its easy, simple and addictive. It’s a large size canvas (just like your table top). Great for organising stuff. Clicks and drags. Keep inspiring articles, music, videos, pictures, all in one place and move them around, or group them, as you like. You can even write stuff or draw on top of these. Great for sorting all that data while research or when starting a new project. And finally, export your thoughts to a regular format that others understand.

The only problem is we use the saved time to do more things in front of the PC and less time on what we actually want to do This one does it all. If you access external windows hard drives, don’t go around with a pen drive, use a simple software called Paragon NTFS. If you run windows, there’re a lot of small utilities that we overlook. Free pdf makers, which help you send all those reference images you collected in an organised format. Use Google docs, its convenient. Download rocketdock and switcher. Switch applications faster. Get deskspace, and all of a sudden you have six different desktops. Great for multitasking. Small utilities which view artwork ﬁles, will help you see the ﬁles your designer just sent. It takes a small amount of time to install things like these, but saves a lot of time later. Subscribe to feeds. You dont really need to go to all those websites opened in all tabs and waste time. Get all the things you need in feeds, use one reader, read it while you travel. Or when you’re waiting for something, say traffic to move in peak hours. I rarely watch news on TV, you get much more updated news on the web. Get simple download managers, we should stop staring at the screen as the progress bar moves and do something else.

Rajaram Rajendran

Browsing takes up a lot of our time. There’s this browser called Rockmelt, if you haven’t heard of it already. Works brilliant. Sign up for an invite, and you’ll get one. See it for yourself. All those bookmarks, interesting sites that you see, all feeds, social networking, and everything else is integrated onto a simple interface. The best part is, you ﬁnd new interesting links, bookmark them at home. When you reach office, or your friend’s place, you get them there. Helps you not waste time on social networking websites themselves, and have your coffee in peace. Hope this helped in some way, there’s a lot more, maybe some other time.

The writer is an entrepreneur, designer, digital artist, wannabe musician and a jack of all, who thinks black & white photography is very cool. To write to the author, please send an email to dare@cybermedia.co.in with the subject line 'Rajaram Rajendran'. DISCLAIMER: The views expressed here are that of the author and do not represent the magazine's.

DARE.CO.IN | DECEMBER 2010

SPECIAL

32 DECEMBER 2010 | DARE.CO.IN

JOURNEY TO THE TOP

JOURNEY TO THE TOP SERIES N R Narayana Murthy, the legendary brain behind Infosys Technologies, gives us a rare insight into his entrepreneurial days. He talks of how the idea of Infosys was formed, how he became a capitalist and what you should do to become a successful entrepreneur. Murthy answers CIOL readers’ queries on various subjects. In an occasional series, Dare’s sister publication, CIOL, presents ‘Journey to the Top’

What is that one moment that made you think of starting Infosys? Anil Rao, anilrao@aol.in In 1974, when I was holed up in a small 8x8 foot room in a railway station at Nis, a border town between what was then Yugoslavia (currently Serbia) and Bulgaria, I realised that the best solution for countries like India to solve the problem of poverty was entrepreneurship and capitalism. I realised how communist rule had punished its citizens without reason and just based on biases. I still remember the words of the guards at the railway station who released me after three and a half days of detention: I was from a friendly country called India and that was why they were letting me go! Then I got on to the train, a goods train, going from Nis to Istanbul. It was a 21 hour journey and I had not eaten for ﬁve or six days before that. Throughout the journey, I was mulling over this injustice, the system of communism, and the problem of poverty in India. That is when I decided to become an entrepreneur and a capitalist. I had read a little

about various economic philosophies by then and realised that the only way countries like India could overcome poverty was through the creation of jobs, which required entrepreneurship.

How did you select your cofounders? And what was each one’s role in building Infosys? Alex, alex.p@yahoo.co.in My colleagues were very young with hardly a year or two of experience in software engineering. Therefore, I selected people on the basis of compatibility of values. Nandan Nilekani, N.S. Raghavan, Kris Gopalakrishnan, S.D. Shibulal, K. Dinesh and Ashok Arora all had a very similar value system. They were all from the middle class and they believed in deferred gratiﬁcation. They were ready to run the business honestly and ethically, they were ready to work very hard, and they were satisﬁed with very low salaries in the beginning. Even today, our salaries are the lowest in the industry. They believed in team spirit. Team spirit is about making sure the other people in the team DARE.CO.IN | DECEMBER 2010

SPECIAL

JOURNEY TO THE TOP

do not fail. They brought complementary values. For example, Raghavan was the people’s person. He looked like he understood human resources. Nandan looked like he was a sales oriented person, I thought I knew a bit of strategy and ﬁnance, Kris liked technology. Shibulal and Dinesh seemed like good project managers. Ashok Arora was a ﬁne designer.

Who selected the name Infosys and on what basis was it chosen? Tinu George, Tinu.George@gmail.com When we decided to start the company on December 29, 1980, I chose N.S. Raghavan, Kris Gopalakrishnan and Nandan Nilekani to work with me. I asked them to think of a name. Generally, I am a very impatient person. So, I told them that they had to come back to me with a name in 48 hours or I would choose a name. For some reason, they did not come back with a name. Therefore, I chose the name, ‘Infosys’, because we wanted to be in the business of designing information systems. So, Infosys is an acronym for information systems.

What did you intend to achieve with the founding of Infosys and in how many years after the founding do you think you achieved what you intended? Gowda Suman, gowda.suman@nss.com I don’t think we have yet achieved what we wanted to achieve. There were several objectives. First, I wanted to demonstrate that it was possible to run a legal and ethical business in India. By and large, we have done that. I wanted to conduct an experiment in the democratisation of wealth. We gave ESOPs to our people. In that sense, we have achieved what we wanted to achieve. We wanted to benchmark 34 DECEMBER 2010 | DARE.CO.IN

ourselves on a global scale in quality and productivity. We have achieved that as well. We wanted Infosys to be a truly multicultural organisation. We wanted the company to be a place where people from different nationalities, races and religions would come together and work in an environment of intense competition, but utmost courtesy and dignity. We have a lot more work to do in this dimension.

During your initial days, did you ever think of quitting or selling Infosys? Sadhana Hegde[M1] In 1990, there was an offer to buy out Infosys for $1 million. Everybody got excited and we held a meeting on a Saturday morning in our Jayanagar office. In that meeting, I let my colleagues speak ﬁrst. When my turn came, I said, “No, I will buy you people out.” They were a little bit surprised because they knew I did not have the money. I said we were going through difficult days, but I was conﬁdent that we would overcome the problems. We had already spent nine years in this marathon. Therefore, I said, it would not be a good idea to sell it off for just a million dollars, although I did not think that a million dollars was a small sum at that time. Within ten minutes, Nandan came to me and said he would be with me. Within half an hour, the others followed suit. That is how we averted that sell-off attempt.

How difficult or easy would it be to start another Infosys in today’s conditions as compared to 30 years ago? Sampath Kumar, sampath_ kumar_1978@yahoo.co.in Well, starting yet another vanilla type software services company would not be easy because the bigger companies have built lots of entry barriers. Today, we own 26 million square feet of office space

just in India. We have offices in 70 countries. We have 110,000 people. We have around Rs 17,000 crore of cash. We are connected with many inﬂuential people in well-known corporations because we are on the boards of various international companies. We have invested heavily in quality, productivity, branding and technology. We have SETLabs (Software Engineering and Technology Laboratories). It works with ten well known universities in India and abroad. We have the world’s largest corporate training centre. We have 600 faculty members dedicated for training. We have a 29 week training program for every engineer. We have 10,300 hostel rooms in our training centre in Mysore. No global or Indian competitor has these facilities. We have a huge human resources department, which can process 10,000 applications a day. The point I am trying to make is that if somebody else wants to do something on the lines of what we do or what TCS or Wipro or Cognizant does, it is going to be difficult. Today’s youngsters have tremendous opportunities if they think of a different paradigm or a different business model. While there is tremendous opportunity in other areas, doing, today, what Infosys did 30 years ago will not be that easy.

Could you share your first breakthrough moment? Name unavailable When we started Infosys, we spoke to a US software company called Data Basics Corporation. During my stint at Patni Software, we had worked with this company. Data Basics Corporation had started its operations in SEEPZ, Mumbai, when I met its CEO. I convinced him that it was much better for him to close down his own operation and work with us. Since he had worked with us earlier, he knew our competence and value system and the difficul-

Even though I am retired, I come to this office regularly. I don’t get a salary. But I come because I enjoy coming here. We are quite happy with what we are doing.

How will Infosys shape up by 2025?

In 1990, there was an offer to buy out Infosys for $1 million. Everybody got excited but I said, “No, I will buy you people out.” They were a little bit surprised because they knew I did not have the money. ties of operating out of India at that time. So, he closed down his operation and started working with us. That was the ﬁrst breakthrough.

Had your wife been the CEO of Infosys instead of you, how would your company have shaped up? Somasegar, Som@microsoft.com She is a much better manager and a better leader than I am. She is much more disciplined than I am. So, it is likely that we would have been more successful. But such hypothetical questions are very difficult to an-

swer. It would depend on the team she would have put together and on the market conditions outside. It would also depend on the ideas she would have chosen. She is better at getting along with people too.

Why did Infosys not utilise its brand reputation and cash reserves to enter other businesses? Soleswaran We are software professionals. We enjoy doing what we do. And there are lots of opportunities in this area. We are all busy doing what we enjoy.

Kadur Srinivas, srinikadur@yahoo.co.in It is very difficult to say what Infosys will be in the next 15-16 years. If you had asked me in 1995 whether we would be a $6 billion corporation by 2010 or 2011, I wouldn’t have been able to answer. All I can say is that we want Infosys to be a corporation where people of different nationalities, races and religions will come together and work in an environment of intense competition, but utmost courtesy and dignity to add greater and greater value to the customer day after day. Whether we will be a $50 billion corporation or a $100 billion corporation in the future... I don’t know.

Is an MBA or an engineering degree necessary to become a successful entrepreneur? Kavitha Murthy, kavi1980@yahoo.co.in No, I don’t think any speciﬁc educational background is required. What is required is a good idea that has value to the market, a team with complementary skills and a good value system, and a market which is ready to pay for that idea. And, of course, you need some money in the beginning. That is not very critical, though. However, if you want to be in a specialised area, then it is better to have expertise in that particular area, like medical electronics, where bringing together doctors and engineers is a good idea. It is not necessary to have an MBA to become a successful entrepreneur. An MBA will help, but it is not mandatory. Source: CIOL (www.ciol.com)

DARE.CO.IN | DECEMBER 2010

RECIPE

SUCCESS

Hurdles in our path can help us find strength VentureBean Consulting founder Anjana Vivek says belief in oneself is the key and the biggest challenge for a woman entrepreneur By Shinjini Ganguli o you think being a woman is the key deterrent to the success of women entrepreneurs? Entrepreneurship itself is about believing in oneself and beating the odds — for both men and women. In some cases, particularly in the initial stages of the business, till the woman shows her capability, society may discount her abilities. It would help if the woman looks at this differently and focuses on the advantages and unique abilities that she brings to the table. Sometimes, negatives and hurdles in our path can help us ﬁnd strength in ourselves. It can motivate us to take charge of our lives. Standing up to adversity and deterrents can help build character.

How has women entrepreneurship evolved over the past decade? It is amazing to see how this has evolved in India over the past decade. I have been observing this area closely from 2004 to 2010 because of my role as one of the course directors of the Management Programme for Women Entrepreneurs (MPWE) at the Indian Institute of Management, Bangalore (IIMB). There is a signiﬁcant increase in the number of women starting their own enterprise. Women from different backgrounds and varying ages, with a variety of 36 DECEMBER 2010 | DARE.CO.IN

qualifications and degrees, are turning into entrepreneurs. Some women have a small business running out of their home; others manage businesses worth several crores of rupees with thousands of employees reporting to them. We have also started seeing a larger number of women taking on significant roles and responsibilities in their family businesses. What specific constraints do women entrepreneurs face in India? Many people in India tend to discount women entrepreneurs, treating this like a ‘time-pass’ hobby for them... as something that women do when they have time left over from their household duties. It is this mindset that needs to be addressed. While for some women, this could be a hobby, for others, it could a serious commitment and a means of livelihood. If people perceive that a women entrepreneur is serious about her work and respect this, then many of the challenges will fade away. Of course, there are the regular precautions working women need to take, which a women entrepreneur will also have to take. How can women entrepreneurs manage their family obligations alongside running their own enterprises? Many women treat their business as

Anjana Vivek Founder, VentureBean Consulting

another offspring. Just as a mother balances the needs of more than one child, I have heard some women referring to their business as their child! Jokes aside, a business has different phases of growth. Sometimes, women choose to grow their venture slowly when family responsibilities are a high priority. For example, you can take fewer clients, produce and sell fewer products with a focus on quality in the initial stages of a business, when your children need your attention. Later, you can diversify and grow based on this foundation, which you have already laid. The key is to balance the family and home lifecycle with the business lifecycle. Having a network of family and friends and a support system that is dependable is also useful. Every woman has to create her own solution. Can you throw some light on the financial, marketing and production constraints faced by women entrepreneurs? Women entrepreneurs face many of the constraints faced by any Small and Medium Enterprise (SME) entrepreneur. Gender may be a handicap in the initial phases till the reputation of the woman and her business is built. Once this reputation is there, most people start focussing on the

business and not the gender of the business owner. Financial capital is a challenge, particularly when starting out on a new or early stage venture. Similarly, marketing can be difficult as buyers may sometimes discount products by women, especially in industries dominated by men. Production can also be difficult as the employees need to believe that the woman can be their leader. How do you think these constraints can be best overcome? This is a slow and steady process — it has to be overcome a step at a time. One way for a woman entrepreneur is to work with believers in the initial phases. This could be through connecting with other women entrepreneurs in the supply chain or working with people who know her and have faith in her capability to deliver a quality product or service in a timely manner. She cannot convince persons that she is capable overnight — it will need to be demonstrated with actions rather than words. A reputation can be built steadily over time. Has there been any change in the sceptical attitudes of ﬁnancial institutions towards women entrepreneurs in the recent past? It is starting to happen. In fact, in the last year or two, some early stage funds have actively scouted for women entrepreneurs whom they would like to support. Technology is crucial to a successful business model, how technologically updated are today’s women entrepreneurs? It depends on the background and qualifications of the women. In India, many SME entrepreneurs have yet to get familiarised with the advantages of technology, and yes, more women than men need to be updated on this. We have been seeing technology used in a limited way

by many companies. So, there is definitely scope for improvement.

believe in the capability and strength of the Indian woman of today.

What are the areas that have seen women entrepreneurs excel? In addition to traditional areas, such as clothing, food, jewellery and designing, which come naturally to many women, other areas are information technology, biotech, education and some areas in the manufacturing sector. Many women are getting professionally qualiﬁed and trained and they are starting businesses in their areas of work and expertise.

What do you say should be the very ﬁrst step for any woman who is aspiring to be an entrepreneur? Belief in oneself is the key. And sometimes, for an entrepreneur ... this is the biggest challenge... The first step starts in the mind. The next is to understand the tools and techniques of running a business smartly. While one cannot always learn from others’ mistakes, one can surely reach out and understand the basics of running a business. If one is hesitant at first, one can start small and learn with baby steps. Networking and talking to other women and entrepreneurs is also really helpful.

Do you think Indra Nooyi and Kiran Mazumdar Shaw are just exceptional cases or the trailer to a bigger picture in the coming times? I am sure we will see many women succeed and excel in the coming years. Women have started to realise their potential and are dreaming big. And once they dream... there is no stopping them, particularly if you look at the current, younger generation of women. Of course, society has yet to catch up... and go beyond gender. If you look around, look at contests, conferences and boards of companies... how many women are there judging these contests or as key speakers or invited to be board members? The number of women out there is much less than the number of women competent to be out there. I

Many women treat their business as another offspring. Just as a mother balances the needs of more than one child, I have heard some women referring to their business as their child!

Could you tell us about your journey to being an entrepreneur? I am a chartered accountant. I started my career in the public sector, was a home maker for a while, then worked in two of the big four consulting companies and also worked for a venture capital fund. From 2003 to 2005, I taught as a full-time faculty member at IIMB in the Finance and Control area. I realised at some point that while I loved to teach (I continue to teach regularly at IIMB), I was not fond of academic research. So, being a full-time academic was not for me. I was fortunate to be supported as a freelance entrepreneur-consultantprofessor by the Nadathur Group, which funds and supports entrepreneurs. The Nadathur Group was founded by N.S. Raghavan, one of the co-founders of Infosys. In 2007, I moved out from under the Nadathur umbrella and started out on my own. I now work with a network of partners and also teach. I am glad to be an entrepreneur and have created a business model that suits me and is both professionally and personally satisfying. This has taken me a while and has been a voyage of self-discovery. Anjana Vivek is the founder of VentureBean Consulting and a guest faculty at IIM Bangalore.

DARE.CO.IN | DECEMBER 2010

STRATEGY

STARTUP

Have it Neat! Irrespective of the nature of work or business, quality ensures growth and acceptability of an organisation in the market. Thus, making it a decisive element in an oraganisation’s future trajectory

ike all dads, my dad used to take me along with him whenever he traveled to the nearest town. One of my favorite among such visits was to my dad’s friend Diwakar Patwardhan’s house. Mr Diwakar was an unassumingly skillful artist. It was a delight to watch his pieces of art in water color, oil, clay, stone, cane, paper and metal. At every instance, we could find something amazing, something attractive. Something strange happened during one of the visits. Mr Diwakar was making a Krishna’s statue in clay. The tenderness of Krishna was present on all over its face, even on the wet clay. I can even remember those adorable realistic fingers over the flute. His response to the appreciation of the work was not very positive. To our surprise he brought a big knife and showed us how a small portion of the flute had chipped out with a small crack. Fuming with anger on himself, he butchered the statute into pieces owing to its defect. His argument was, the sculpture will not have perfection even when the fracture is fixed. He had always stood by quality, whatever he did as a profession or passion. True quality is a mindset rather than following prescribed steps. For some quality comes naturally in their work. I think from point of view of brain’s networks, genetically, quality should follow two traits. Commitment and immunity to monotony. Adhering to quality as a part of discipline in a workplace is commonplace but asserting quality in doing personal thing is a characteristic. One needs loads of commitment to not succumb to casualness leading to inadequacy in outcome. It is true in production as well as service. If you start recalling every action of yours since this morning, inclusive of sundry personal activities like drying your clothes, you will realize that there was scope for improvement in every action. We compromise

38 DECEMBER 2010 | DARE.CO.IN

on several aspects like a small wrinkle on our shirt, the dust mark on the steering wheel or the way we keep the newspaper back on shelf. A total commitment and adherence to quality when our conscience is aware about the shortcoming is a rare commodity. Boredom to do repetitive tasks with equal dedication is another aspect wherein we tend to compromise on quality. If you have ever numbered the notebooks from first page to last, you will know what I am trying to say. Every consecutive signature of yours after the tenth is unlikely to be honored by the bank. You loan application for the bank will depict the story. As we age we start gaining better control on our patience and commitment. A teenager is very unlikely to be quality conscious compared to an army officer who is about to retire. A tidy room of a teenager boy is a place yet to be discovered. This basically means that, innate character, environmental compulsion and pre-occupancies and interests in the work would determine the quality. There are couple of interesting mental disorders which can confirm role of cerebral network in determining the character of quality. Have you heard of “neat freaks”? So-called “neat freaks” or “clean freaks” are people who spend a significant amount of time cleaning and ordering. But the desire for neatness, according to experts, “runs along a spectrum.” The desire for neatness may be a stand alone character or a shadow of bigger syndrome called obsessive compulsive disorder (OCD), prevailing in the individual. While OCD patients cannot carry on daily activity and function as normal social animals, neat freaks can get along well with the society. According to experts, usually neat freaks live under tremendous stress and spend a significant amount of time, sometimes several hours a day, trying to maintain immaculate neatness, precise order and faultless arrangement of their immediate environ-

A total commitment and adherence to quality when our conscience is aware about the shortcoming is a rare commodity

ment. During the visit to their relatives, do not be surprised at a neat freak trying to clean the sink, which is not clean enough by his standards. The following characteristic of these individuals can tell us how invaluable could they be in a QA - QC department of a ﬁrm. They believe in excessive need for perfectionism and control. They do not mind parting their effort towards such activity. Preoccupation with details, rules, lists, order in the organization is a common practice. This could be a nightmare for the colleagues, let alone their spouses. Excessive devotion to work can make them workaholics and boss favorites. They could be quite impassionate and rigid with respect to matters of morals, ethics or values. They may always advocate the belief that cleanliness is next to godliness. The point here is, the attitude towards indulging in quality has lot to do with how an individual is wired. Our genetic make up is partially to blame for our attitude towards quality. But a positive approach towards quality can be inculcated by practice. The best example could be the near perfect endeavors or the military discipline which can be seen across all cadres of individuals who wear the uniform. Careful monitoring and fear of punishment and rewards for maintenance of quality can change the attitude of individuals towards quality. Exposure to quality work, manufacturing practices or hospitality services make a big difference among people. Constant exposure to high quality standards and practices convert them into habits. The individuals, who grow up in such environments assume them as norms and practices without any deviations. However, it is nice to see organizations approaching quality as a separate discipline. Several standard practices have been developed and implemented with substantial vigor. A mathematical and statistical angle added to these practices has lead to further improvement in

Dr Hrishikesh Damle

their applications. These are the corporate tricks to control the employees, who otherwise can go haywire and result in bad experiences to the customers and great loss for the ﬁrm’s reputation. The best remedy to counter boredom is force and vigilance. The discipline in doing homework without errors is possible only by making the child subversive. It is difficult to make a stronger and older college student to submit his assignments when he is not willing to do so. True commitment for quality is unlikely to be expressed in fullness, in the absence of passion for the work performed. Though the implementation of systems like ISO, Six sigma can bring in considerable improvement in quality, there could be no substitute for passion for the work. The attitude towards quality becomes primary in services which are more subjective as in hospitality industry. If every individual company analyses its best performance, it would undoubtedly be in the product or service which has been approached with greater drive. In the competitive world of free market economy, a product or service substandard or inferior quality can not survive long. While it is a challenge to maintain high quality standards when one has diverse products in their portfolio, thanks to seriousness in understanding the subject in detail, we have various documentation processes and tools available which can be plugged with the help of experts for most of the needs of the industry. In few hundred years from now, natural selection will probably favour a life which carries a gene 0f higher quality standards. If not, market economy will punish those who lack quality. Dr Hrishikesh Damle is a ﬁrst generation entrepreneur. He is CEO of Atrimed, a pharmaceutical company. To write to the author, please send an email to dare@cybermedia. co.in with the subject line 'Dr. Hrishikesh Damle'. DISCLAIMER: The views expressed here are that of the author and do not represent the magazine's.

DARE.CO.IN | DECEMBER 2010

OPPORTUNITY

NUTRACEUTICALS

The healthy dose of business Majority of us may believe in, “health is wealth”, but only a few of us know the business of healthcare product can spin gold for us. The 4000 crore Indian nutraceutical business seems lucrative, here’s a closer look! By Sharmila Das ndustry experts say manufacturing nutraceuticals (the word is an amalgamation of two words--nutrition and pharmaceutical) is not new in India. Srisailen, Business Head & Head Corporate Communication of Alliance Biosciences, a nutraceutical manufacturing company, shares, “It has been in practice from last three decades. But of late, the growing trend to lead healthy lifestyle has fueled the business’ growth. Today, this industry offers a thriving opportunity.” Alliance Biosciences P. Ltd. (ABPL) is situated in a beautifully laid out scenic location in Pondicherry, which is also called the French Riviera of the East. Besides nutraceuticals, Alliance Biosciences manufactures probiotics for various companies across the globe. The company is based in southern India. Nutraceuticals is any element that is a food or a part of a food and provides medical or health benefits, including prevention and treatment of disease. They are healthcare products and are formulated and taken in fixed dosage form such as capsules, tablets, etc. Nutraceuticals comprise a wide range of products including dietary supplements for example vitamins, minerals, co-enzyme Q10, saffron, ashwagandha, safed musli, etc. Major players in this space are

40 DECEMBER 2010 | DARE.CO.IN

Ranbaxy, Piramal Healthcare, Himalaya, etc. The business of manufacturing nutraceutical can be started with a start up investment of Rs 70 lakh to Rs 1 crore. Contract manufacturing is another way of starting this business where the contract manufacturer produces nutraceutical product on behalf of other companies. The precise term for contract manufacturing is outsourcing. In India, both modes of nutraceutical business model is available. Nutraceutical manufac-

turing process generally consists of the following steps: 1. Sourcing raw materials, 2. Warehousing raw materials or raw ingredients, 3. Measurement of ingredients for inclusion in such products, 4. Blending the ingredients into a mixture, 5. Tableting or pouring the blended mixture into appropriate dosage form,

6. Bottling and packaging the product with tamper-proof features and sending the packaged product to a distribution point for delivery to retailers. Nutraceutical places special emphasis on quality control and conducts inspections throughout the manufacturing process, including raw material verification, homogeneity testing, weight deviation measurements and package quality sampling. Know-how of nutraceuticals manufacturing is close to pharmaceuticals manufacturing. The third party manufacturing nutraceutical or contract manufacturing is better as the third party nutraceutical regulation is not as stringent as it is in pharmaceutical. The third party manufacturer/contract manufacturer is generally responsible for sourcing raw materials, producing the products, hiring laborers for the manufacturing work and finally, dispatching the product to the end user. Third party manufacturer or the contract manufacturer convinces their clients that they would be in a better position to produce quality product as they can keep the manufacturing cost low and therefore can garner larger profit share.

Where to get raw ingredients To source the raw ingredients, a nutraceutical manufacturer can contact companies who solely supply raw materials to pharmaceuticals and to different health product manufacturing organisations.

Growth Drivers There are a host of factors fueling the growth of nutraceutical market in India. Increased knowledge of the nutrition supplement products, the increase in disposable income, changing lifestyle, etc. are few factors fostering the nutraceutical market growth in India. Besides, Drug Controller’s plan to allow certain restricted drugs (like morphine tablets), not only in

FACTFILE Market size of nutraceutical is around 4000 crore, growing at 17 percent CAGR.

pharmacies but also at grocery shops and department stores, is also helping the unrestricted spread of healthcare products. This is a signiﬁcant shift in government attitude towards the healthcare needs and aspirations of the common man. New entrants in this business segment are trying to capitalize this new development so that they can establish their footprint into manufacturing nutraceuticals.

Market size and growth Nutraceutical market in India is growing much faster than the prescription market which was always considered to be the backbone of Indian healthcare industry. Senthil Kumar, Director, Alliance Biosciences informs, “The Indian nutraceutical market is around Rs 4000 crore and it is growing at 17 percent CAGR (Compound Annual Growth Rate). Due to the competitive nature of the market, the business has good potential to earn even 200 per cent growth.”

TAKE AWAYS Academic qualification in B. Pharma required

USP Profit potential is huge as the market is growing fast.

MUST DO Adhere to the rules of Central Drugs Standard Control Organisation.

Overall Challenges A new entrant should know the basic essentials of drug regulation act of India. These regulation acts compel manufacturers to achieve and maintain certain quality standard of their product. Besides, there are several consumer forums in our country which can act against the nutraceutical manufacturers if the products are not produced at per set standard. Pricing is another concern for a new entrant, as to tap the nutraceutical market one may need to keep the product prices reasonably low while the cost of manufacturing incurs higher. Next challenge is distributing the products to the end users. Finding proper distribution channels to distribute the product is a difficult task. In some cases, the new entrant may have to offer freebies to convince the distributors. Despite these, the fact remains the same. The future of nutraceutical business in India is promising. It holds the capability to earn good return for their manufacturers. DARE.CO.IN | DECEMBER 2010

STRATEGY

STARTUP

The journey itself is the destination Long have we missed out on small pleasures of life trying to quantify them against wishful ambitions but it's time we teach out next generation to be content with what they have and pursue a knowledge path as opposed to monetary path e all wait for that big sign that clearly spells out “opportunity” to arrive at our doorstep. But when we look at the lives of people who made a major impact on the world, we see that they all started as ordinary people doing “ordinary” things. It is what they chose to do with their situations that matters. Be it Gandhi thrown out of the train or Rosa Parks being asked to move to the back of the bus — they each had to deal with the same set of rules set for everyone else. BUT three things separate them from the rest. ONE, they were not afraid to publicly voice their convictions; TWO, they were not afraid to follow a seemingly “unreasonable” path, and THIRD, they did not set out to be global heroes. They did not have a business plan to make a difference in the world. It is their journey and the ruthless adherence to continue on that journey that made the world stop and take notice. Today, we live in a world of reality TV, 30 seconds of fame and a sound-bite culture. And the only people who get noticed are the ones who shout from the top of the roof and people who can buy fame through money. We are building a world of role models whose claim to fame is strictly through their net worth. Financial institutions that were built over hundreds of years are tumbling down and we all blame “them.” If we can be honest with ourselves, we can see that we stopped celebrating the small wonders, minor achievements, and local successes. If you go to www.globalrichlist.com, it says that if you make $2000/year, you are in the top 17.62 per cent richest people in the world, and if you make $25,000/yr, you jump to the top 10 per cent. Imagine that! We are all richer than we think we are and there is no need to compare ourselves to the top 1 per cent and remain unhappy. I think that it is important to teach our next generation to be happy with what we have and pursue a knowledge path as opposed to a mon-

42 DECEMBER 2010 | DARE.CO.IN

Lakshmi Pratury

etary path. It is important to value small gestures, local innovations, and above all, integrity. We read about corrupt politicians, arrogant movie stars, and unruly teenagers, but for every one of these bad examples, there are thousands who are exceptionally good. But we have no opportunity to see them, celebrate them, or become ambitious about becoming heroes ourselves. When I ﬁrst sat in the audience of TED Conference in 1994, I was blown away by the talent that exists around us – not just from people we read about in magazines, but people who go about doing their own thing like Gandhi, like Rosa Parks. Scientists unveiling the wonders of this world, technologists discovering new ways to communicate with one another, designers forcing us to see the world a little differently, musicians who can take you to those magical places, textile designers who let you drape yourself in art, and the list goes on. The willingness of speakers to set aside their façade to talk about what really matters was a breath of fresh air to me. I was hooked and never missed a TED since then. And my move from being a spectator to a co-host also happened in the most undramatic way. I always wanted to bring TED to India and was happy to help as any other TEDster. I dreamt of cohosting, but I was nervous to even articulate it. I convinced myself that I was not the right person to do it; that I didn’t have the time, and that I needed to do something that made money so that my future was even more secure, and only then I could do something like TED. It is amazing how we are our own worst enemy. As I was going through this, I remembered an incident with my father. When I was at IIT, I wanted to go on a trek to the Himalayas and my entire family vetoed the decision. There was no way they were going to send their 21year-old girl to scale some mountains to Rohtang Pass.

Entrepreneurs who feared nothing and went ahead with their dreams.

No amount of hunger strike, tears, and tantrums were going to change their decision. My dad explained to me why he could not let me go on this trek and went off to take his afternoon nap. I sat in the hallway sobbing because I could just see my dream slip away. I didn’t grow up being outdoorsy or remotely athletic, and I was always in the last group of people to finish a hike. But I felt that I found something inexplicably intoxicating along the winding pathways that were untouched by human intervention. I love what we each become around nature – a lack of attention to what one wears or how one looks, a sense of egalitarianism and camaraderie is omnipresent. And to top it all, the pure beauty is breathtaking and keeps pulling one towards it with an unseen force. I did not want to miss it. As a last ditch effort, I poured my heart out into a letter explaining why it was important for me to go. I wrote that I was a grown up and that I needed to take chances. I slipped the note under the saucer of the cup of chai being sent to my father, following his nap. To this day, I can feel the thumping of my heart and the sweaty palms as I waited for the door to open. Finally, the summons came from my dad. He was deep in thought with my letter in his hand. He looked at me as though he was looking at a new person. Maybe that was the moment he saw me as an individual, separate from him, with my own passions and my own need for an adventure. We had a long chat and finally that letter convinced him to let me go on that hike. That was my entry into adulthood making way for my own adventures. I limped my way to the Rohtang Pass with blisters on my feet and a leech bite along the way, but I was ecstatic to make it there and back. The journey was the destination for me. As I was talking myself out of asking Chris if I could cohost the conference, I thought about that letter and about the reversal of my father’s firm resolve. And I decided to give it a try. It took a Herculean effort

to open my mouth and say, “Why don’t I work with you to host TED in India?” and the answer was an immediate “yes.” He said that he always had an emotional tie to South Asia as he was born in Pakistan and grew up in India, but he simply did not have the bandwidth to host a conference in India. If I was open to taking it on, he would be game. And thus began our journey. It was a lot more work than we had thought, a lot more adjustments across cultures than we anticipated and a lot more emotional upheavals than I was prepared for. However, the entire team, including Chris and I, was happy with the results, in the end. There is always room for improvement. The most exciting part is that the journey continues. When we completed TEDIndia, we spoke about its continuity. The plan for TED was to host it once in India and let the follow up evolve. I felt that I had found my next journey. It is to take the concept of TED and make it relevant to India and other economies like India. We worked with TED to launch The INK Conference, in association with TED. It is a scary proposition—to follow in the footsteps of the master of the game with a 25 plus year-old history and live up to its standards is a tall order. We continue to take advice from TED on the theme, sessions, fellows, partners, and all aspects of INK, and we are thrilled that they will distribute INK content per their editorial guidelines on their site. We are taking baby steps to create an effort that could be larger than the sum of parts. And I feel that my job is to create the journey and be delighted with the destination...whatever it may be. For each of us at The INK Conference, the journey itself is our destination; we learn from every mistake we make, and hope to take everyone along with us on a path where we can learn together. Lakshmi brought TED to India in 2009, when the ﬁrst TEDIndia conference was held in Mysore. Her career crosses entrepreneurships of all kinds. She is the founder and CEO at Ixoraa Media.

DARE.CO.IN | DECEMBER 2010

ENTREPRENEUR

Photo: Brandcomm

EMERGING

Radha Kapoor (Left) and Esther Lennaerts 44 DECEMBER 2010 | DARE.CO.IN

Keeping your garments sparkling clean The DoIt Creation is basically a holding company which has invested in Pressto and another venture called Brand Canvas. The vision is to invest in creative and premium business ventures and make them grow. By Team DARE

t’s not often that we see rank freshers jumping into capital-intensive ventures. And offering premium drycleaning services is not a mom-and-pop story, anyway. There is very little room for trial and error. Yet, you cannot get all the pieces of the jigsaw puzzle when you start up. Such a feat has been accomplished by Mumbai-based Radha Kapoor, a NID student who is passionate about doing things out of the box. She saw an opportunity and brought the French dry-cleaning services Pressto to India. But she hasn’t stopped at that. She is building a design studio that focuses on wallscaping. DARE spoke to Radha and Esther Lennaerts, Executive Chairman, Pressto.

How did you get into this venture? Radha: Dry cleaning is a basic need. With Indian conditions being the way they are, clothes get extremely dirty in a very short span of time. There was a real need for a place where you could get your clothes cleaned with quality. India has a rich heritage of beautiful and colorful garments and textiles, and with global brands coming to India, there was always an issue of ﬁnding a good dry cleaner.

Did you find the need to partner with some local talent or business who had done this before? How did you jump into it on your own? Radha: No. As our concept is very different from the local dry cleaners there was no real competition from them. But in order to cater to the Indian market we learned about cleaning Indian garments. We went through an extensive

training program in Spain and also focused on training our staff thoroughly. Since we began operations in India we have cleaned over 2 million garments.

Did Pressto customize their machinery to handle Indian garments? Radha: Not really, but we have developed a dry-cleaning program for Indian garments. Indian garments are locally dyed with a full range of embellishments. If you put these garments in a normal dry-clean cycle, some of the embellishment doesn’t stay in it. Pressto developed a professional program for these kinds of garments and tested it for one year in our ﬁrst store in Juhu. Our program was a huge success and we are proud of the number of garments we have cleaned since.

Typically, how much time do you take to deliver a garment? Esther: We can deliver a garment in approximately two hours, at an express charge. Normally, depending on our workload, we take two days, or maximum three.

Many of the upmarket dry-cleaning services also deliver within two days. What is your USP? Esther: We offer the best quality you can get in India. Our USP is that we have a dry-cleaning machine and highly trained people in our store. Our store manager is fully responsible for the cleaning and customer deliveries. Our customers get a full understanding of what is going to be

DARE.CO.IN | DECEMBER 2010

EMERGING

ENTREPRENEUR

The biggest challenge in cities is to get affordable real estate where you have all the facilities or can build all of the facilities that are technically needed done to their garment, and so the customer feels totally at ease with our service. Most dry-cleaning services have huge caging machines where millions of garments get cleaned together. Pressto machines are only 16 kg and are much more hygienic in their cleaning as a lesser quantity of clothes are cleaned together. What is also unique to Pressto is that we clean our cleaning solvent after each cycle. This is an expensive method, but quality is very important to us and we don’t believe in shortcuts.

What was your strategy in convincing the customers to come to you rather than go to their friendly neighborhood dry cleaner? Radha: Our friendliness is what made people come to us.

How did you get your first set of clients? Esther: When we opened our ﬁrst store in Juhu, most people just walked in looking for a quality service. In the last three years, we have had 20,000 customers and have cleaned over 2 million garments. Our entire customer base has been through word of mouth, and today we have 20,000 happy customers.

What is the vision behind the DoIt creation? Radha: The DoIt creation is basically a holding company which has invested in Pressto and another venture called Brand Canvas. The vision is to invest in creative and premium business ventures and make them grow. With Pressto, we are aiming to grow to about hundred stores by 2015.

You are also planning to set up a creative studio. Is that going to be a different business or is it part of Brand Canvas? Radha: It is actually a part of Brand Canvas with a focus on wallscaping. Our vision is to do customized wall art for branding.

Coming back to Pressto, how easy was it to identify different locations and space? Radha: Part of our marketing strategy was to be in an area where you have good signage and visibility. Most 46 DECEMBER 2010 | DARE.CO.IN

of our locations are on urban high streets where we have good visibility. The biggest challenge in cities is to get affordable real estate where you have all the facilities or can build all of the facilities that are technically needed. To overcome certain technical challenges like water shortage on premises, the Pressto India technical team has developed internal water circuits that cool the water and reuses it again. With this kind of specialized expertise, we have been able to work in our smallest store, which is only 560 square feet.

How has the entire project been funded? Radha: The investment for the project has come from DoIt Creations and ELYM.

In broad terms, can you give me a sense of your growth? Radha: The retail sector in India has gone through major cycles and only the strong businesses who knew what they were doing have survived. Our biggest achievement in this scenario has been that we turned around a profit within the first year at the store level. Keeping a careful eye on your profit and loss is an extremely important business rule that we have followed.

Is each unit responsible for its own quality control or is there a quality control unit? Esther: Quality control happens at various stages. Our operations are broken into stations, and at each station there are quality checks. The ﬁrst stage is where the garment is inspected for any alteration, following which it goes to stain removal where each stain is removed twice. Moving on, it goes to pressing and then packing. At each station, the person who handles the garment checks the quality of the previous station before sending it forward.

How did Presto decide on coming to India? Radha: India has been fairly popular in the West, and Spain was deﬁnitely eager to come to India. Pressto was successful in getting a 50 year franchise in India, which made a lot of business sense as the younger, upwardly mobile Indian generation will come of age in the next decade and would form our major customer base.

Do you have exclusive rights for India? Radha: Yes, we have exclusive rights for the India zone.

Any plans of going to new cities? Radha: As of now, we have Delhi and Mumbai. As I said earlier, it is very important to keep proﬁt and loss in mind before expanding. When you go into a new area you need to set up the infrastructure and the people, and all this affects the proﬁt/loss balance.

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Twenty Eleven is round the corner. Are you ready to take the leap and become a world class quality organization? While you are sharpening your strategies, here is a line up of advice and experience from people who have made that leap

Read a thought-provoking piece from Prof R Srinivasan, associate professor, IIMB Ruminate on Ravi Talluri’s recipe drawn from his personal experiences in Fortune 100 companies in the US Listen to Virender Kapoor’s down-toearth bytes on leadership qualities

50 DECEMBER 2010 2010 || DARE.CO.IN DARE.CO.IN

CASE STUDIES: Work hard, gain customer satisfaction, earn money: Mumbai Dabbawallahs’ mantra is still valid Do not try to sell expensive solutions in costsensitive markets: See Educomp’s success Put the cows in the cloud: Chitale Dairy’s ambitious venture into scaling big

To succeed and grow, entrepreneurs must stop playing God If you are serious about giving your small business its best chance TO GROW, then learn to ‘let go’, now! And, instead of endlessly obsessing over products and services, invest on building organizational strengths By Prof. R Srinivasan he fortune of an organization hinges not only on its products but (more importantly) on its inherent strengths across functions—from human resources to customer care and R&D that fuels sustained innovation. This is well known; still many ﬂedgling businesses continue to die young because instead of investing on those organizational strengths, entrepreneurs spend most of their time obsessing over their “dream product or service,” the one “big” idea that inspired their start-up. Put simply, many entrepreneurs invest too much on products and too little on building organizational muscle. Their businesses are unlikely to survive largely because they do not do enough to build their support and service systems that are needed to deliver on the (often exaggerated) promises they make about their products and services to woo customers. The lack of adequate underlying systems or customer fronted support can have only one consequence: dissatisfaction and eventually desertion,

of customers, employees, partners, investors and so on. This trend is particularly true of smaller organizations where the customer service department is often the weakest link. It is critical for entrepreneurs to realize what their speciﬁc skills and competencies are, and what their weaknesses are. For instance, a great enterprise could be built around a great product idea that the entrepreneur developed and nurtured, but the entrepreneur might not be good at customer service that the product so critically needs to succeed. The essential fact is that young entrepreneurs are wont to overlooking the importance of building all-round organizational abilities, which are important for a) delivering world class services and b) building value across functions. They, therefore, fail to sustain their growth, build brands and/ or establish relations in the marketplace.

These businesses are too caught up with developing the one product or service that made them famous, instead of building robust, world class systems that could hold them up at even if that one product failed—and, equally support them through their transformation, from a single “wonder product” company to an Innovation Enterprise: an Apple or 3M that

Prof. R Srinivasan Associate Professor, IIMB

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churns out wave upon wave of innovative products over generations. In other words, the nemesis of young entrepreneurial organizations is that they do not always recognize the fact that it is not enough to build a single fantastic product: to succeed in the marketplace the product needs to be backed by world class services. And to retain your edge in the long run you need to create an organizational machine that feeds on innovation and continually rolls out exceptional products and services—almost by default. In the absence of specialized lines of service to lend focused attention to different functional areas, the entrepreneur as the only recognizable face of his organization ends up becoming answerable for everything and more devastatingly to everyone: customers, partners, suppliers and employees on every little issue. This usually results in all-round dissatisfaction, leading to loss of customers, employees and so on. It is true that even those entrepreneurs who recognize the need for building world class services in their organizations, are often unable to do so simply because it is difficult to ﬁnd people with the right capabili-

ties. A support manager at a products company must, for example, be both knowledgeable about his products and equally savvy at handling customers. Such people are hard to ﬁnd, sure. But given how critical it is, enterprises must never rest until they have found them. Because the fact remains that inferior support is the biggest and the most common reason for the pre-mature demise of many a brilliant start-up. A perfect example of this is an online business that entered the travel and tourism space with what seemed to be a brilliant idea. On its portal people intending to tour India could deﬁne what exactly they wanted to do or see in the country and expect to be served with a package customized to their individual needs. Further, the business promised to take care of every requirement of the tourist when in India, end-to-end. Conceptually this was an idea worth dying for. But when it came to delivery it did not work. Reason? The company simply could not find the number of experienced agents required to “support” such a complex project. The company signed up with local tour operators who provided a different tour guide at

Entrepreneurs must realize that by delegating they are not really losing control or ownership. Letting go can actually catapult an entire organization up the quality ramp, resulting in vastly improved products, services and information 52 DECEMBER 2010 | DARE.CO.IN

each destination. The challenge here was that each guide needed to have a complete understanding of what the traveler actually wanted to do at that particular destination. But during the handover from one guide to the other there was a breakdown in the communication process and the whole thing went for a toss leaving the customer highly dissatisfied. Product organizations face similar problems. An IT organization comes out with a great new product and sells it to top brass clients. At this point the contact person at the IT ﬁrm must clearly inform the client about the departments or people who need to be reached for addressing different kinds of issues or queries. Since, many small product-obsessed companies do not boast of such specialized service functions, the buck stops with the entrepreneur for even the smallest customer related question. For many of these questions the entrepreneur may simply not have the answer or there may be issues for which he may simply not be able to provide the support the client expects. In such cases client dissatisfaction is a certainty. The best way forward for a small organization is to invest in building a robust organization armed to provide world class support to every service, especially those facing the customer. Each query must go through proper channels and be resolved by specialists instead of landing up at the entrepreneur’s table. This is tough for both the smaller entrepreneurs who want to have complete ownership and control and do not trust their second tier leadership, as well as their clients who perceive to have given the project to/ engaged the entrepreneur and not to the enterprise. This practice leads to unrealistic expectations from both ends, and finally customer discontent. There are three cardinal rules that entrepreneurs must follow to grow their organization rapidly.

The lack of adequate underlying systems or customer fronted support can have only one consequence: dissatisfaction and eventually desertion, of customers, employees, partners, investors and so on Prof. R Srinivasan Associate Professor, IIMB

One: They must clearly identify their own skill sets and then invest in people with other complementary skill sets necessary to drive the business. A classic example would be Roy E. Disney. As a heir apparent to the Walt Disney organization, Roy Disney decided to bring in professionals to run the company, and decided to stick to animation the one area he was passionate about and understood well. Result: Roy built a hugely successful organization around animation films. Successfully managing a modern business involves expert handling of multiple disciplines and specialties: no single human can possibly have expertise across all those areas. Understanding one’s limitation (and levels of incompetence) is what can ultimately help entrepreneurs sustain organizations and brands. Once an entrepreneur knows what his role is in his organization and hires

experts to handle the other roles, he is on the way to building a winning organization. Two: Every product/ service should be managed as a program, with a deﬁnite life and value. There must be a clear idea about the longevity or life cycle of their products and accordingly how much value the organization can gain from them and for how much time, should be deﬁned. For example, if the life cycle of a product is 10 years then the entrepreneur ought to be able to estimate the revenue it could generate over that period. At the end of its life cycle, every product needs to be rejuvenated, rebuilt, or even killed. Three: They must accord considerable importance to service quality. Everything that is sold to customers has three components: product, service, and information. There is nothing that is pure product, or pure service, or pure information. The value is in providing the appropriate mix of

products, services and information to the consumers. In many cases, people do not balance these three. For example, many organizations turn out good products but in the absence of service and information quality they perform poorly. In sum, entrepreneurs must realize that by delegating they are not really losing control or ownership. Letting go can actually catapult an entire organization up the quality ramp, resulting in vastly improved products, services and information. It should end in creating a program for the product/ service offering. Bottomline: To succeed, Entrepreneurs must stop playing God. Give up to Grow Fast or More.

R Srinivasan is Associate Professor of Corporate Strategy & Policy at the Indian Institute of Management Bangalore. His research focuses on rapid growth ﬁrms, and he jointly coordinates the Management Programme for Entrepreneurs and Family Businesses (MPEFB) at NSRCEL, IIMB.

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COVER STORY

GLOBAL ORGANISATIONS

Happy customers only goal for world class organisations World class organisations do things differently to be the best of the best. They believe in setting standards of excellence, whether it is in quality, customer service, innovating, creating value, or taking caring of their staff By Ravi Talluri orld class organisations produce superior goods and services, ranked by customers to be among the best of the best. They strive for excellence not only in their own industry, but other industries as well. Being “world class” means setting incomparable standards of excellence, in design, performance, quality, customer satisfaction and value creation. Few Indian companies currently belong to this hallowed club; indeed for many of them just surviving the white heat of global competition is a challenge. But, clearly there is ample scope and opportunity for Indian organizations to become world-class—if only they could change the paradigm. Having worked in USA and India for more than two decades, I would like to share my insights on how we can become world class. Customers: Customers are the very cause of the existence of the business. The business starts and ends with customers. Understanding customer requirements and then fulﬁlling them with suitable products and services is of paramount importance for the success and growth of any organisation. World class organisations continuously strive for

54 DECEMBER 2010 | DARE.CO.IN

complete customer satisfaction and aim for customer delight. I had the opportunity to work for some Fortune 500 companies in USA. In our quarterly review meetings, the ﬁrst item on the agenda was to discuss customers and their feedback. I have never attended a quarterly meeting where the ﬁrst agenda was not customers. I was once informed about a customer issue in the middle of the night. The customer was upset with the performance of our product. I immediately asked for the product to be replaced and met the customer. The customer was pleased because we replaced the product immediately and made sure that there was minimal disruption to his production schedule. Later on, I briefed my senior management about the issue. The entire top brass of the organisation backed my decision to replace the product immediately. They felt that I took the correct decision to make sure that complete customer satisfaction was ensured. A couple of weeks later, the customer mentioned the incident and our dedication and passion for customer satisfaction in an international gathering. This further enhanced our market image. Customer feedback and satisfaction was the guiding force for developing

corporate strategies. Indian companies should make it a point to spend more time with their customers and make complete customer satisfaction their top priority. Understanding customer requirements and meeting their expectations is very vital for the long term success of Indian organisations. Customer feedback is important for gauging customer satisfaction levels. Formal mechanisms should be deployed for understanding customer requirements and capturing their feedback. This information should be used for developing and improving products and services. Employees should be informed about the importance of customers, their satisfaction and their feedback. What sets world class organisations apart from the rest is how well one understands one’s customers and offers them products and services which meet and exceed their expectations. Value creation: The most profitable and fastest growing players in their respective markets put value creation ﬁrst, not growth or size. These world class companies have built their business models around value creation. Their focus is on value creation for customers, stakeholders, their employees and

suppliers. High value creation organisations constantly challenge themselves and ask what we can do that is different from the competition, and how we can create value. Value creation for customers means developing and offering high quality products and services that they ﬁnd useful and that give them complete satisfaction. Providing superior value to customers results in long lasting customer loyalty. Value for employees means being treated respectfully and being involved in the decision making process. Employees value meaningful work, excellent compensation opportunities, and continued training and development initiatives. Providing consistent and superior returns is value for the investors and stakeholders. If Indian companies want to grow to greatness, they have to put value creation ﬁrst. Innovation: To meet the changing aspirations of customers, world class companies are constantly trying to offer innovative products and services. Those who are unable to innovate are in the process of losing

business. World class companies encourage employees to develop innovative products and services. While I was working for an automotive company, our group came up with a proposal to develop an airbag to save a child in a mother’s womb during a crash. The management gave the green signal to develop such a product. Organisations should continuously focus on product and process innovation. Product innovation will help organisations to stay ahead of the competition. Process innovation will help them to become more ﬂexible and improve quality standards. Few Indian companies are pioneers of innovative products and services. Innovation is essential not only for gaining competitive advantage, but for the survival of organisations. Employees should be encouraged and empowered to look at opportunities and challenges from a different glass prism. Conducive atmosphere should be created so that it allows employees to engineer innovation. World class companies do not rest on their laurels, they continuously focus on how to make products bet-

ter, cheaper and faster. They attach tremendous importance to continuous improvement. Quality: Superior quality products and services are the hallmarks of world class organisations. Quality is everyone’s job. This culture should be ingrained in every employee of the organisation. Quality is not inspected for; it is built into the product or service. Quality at source is the philosophy that is adopted at the early stages of the product concept. Every employee feels that it is his responsibility to produce world class products or services. Customers are expressing their loyalty by buying superior quality products. Superior quality is the shortcut to becoming world class. Quality is a journey, not a destination. World class companies are obsessed with superior quality. A mindset change has to take place and quality has to be looked at from a different perspective for Indian companies to become world class. Quality is not just about performance. It starts from taking the order, delivering the product, after sales and service

Quality is a journey, not a destination. World class companies are obsessed with superior quality. A mindset change has to take place and quality has to be looked at from a different perspective for Indian companies to become world class Ravi Talluri Management Consultant

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VOICE OF THE CUSTOMER Capturing customer needs, aspirations, expectations, aversions and requirements is the voice of the customer. This can be done by direct customer interactions, market surveys, observations, warranty data, etc. Once the voice of the customer is captured, the data has to be organised. Tools such as affinity diagrams, QFD, etc., are helpful in organising the data. These methodologies and tools will systematically link the voice of the customer with various business functions such as marketing, design, quality, production, manufacturing, sales, etc., and align the entire company towards designing and developing products and services to meet customer requirements.

â&#x20AC;&#x201C; the entire lifecycle of the product. Customers are delighted when they buy products or services from world class companies. Benchmarking: World class organisations are continuously benchmarking themselves against the best of the best and striving for excellence in all areas. In fact, some world class organisations spend a lot of time studying the competition, understanding their organisation, reviewing their products and strategies. Organisations set tough internal standards and try to exceed those standards. This is how they became world class organisations. World class organisations benchmark customer satisfaction, ďŹ nancial performance, product quality and performance, internal processes, productivity, employee development, safety, etc. Companies identify various metrics for benchmarking based on the products and services they are offering. Companies use both internal and external benchmarking approaches. I had an opportunity to work on such a benchmark assignment while I was working in USA. The benchmark set was against that of a Japanese company. Though USA and Japan were rivals in business, everyone agreed to benchmark the Japanese company. The group spent several months in the benchmarking exercise. This helped in the development of better quality products. Organisations have to make it a habit to continuously benchmark and strive for excellence. Indian 56 DECEMBER 2010 | DARE.CO.IN

companies have to assess to know if what they are doing is the best and what they are on their way to achieving is truly world class. They should benchmark against high performing organisations. Organisations have to aim for the highest standards and implement plans that will help them to join the world class club. Leadership: The success of world class organisations can be traced back to leaders who possess world class leadership qualities. I was fortunate to work with a senior executive of a Japanese world class company. This leader would not be satisďŹ ed with anything less than excellence. He was very demanding and would never comprise on quality and safety aspects. He led by example. At times, when I could not solve a problem, he would stand by my shoulder and show me how to solve the problem. I was surprised by his dedication. Though he was a very senior executive, he would stand along with me for more than 12 hours and for several days and help me solve the problem. Though my association with this leader was for a very brief period, I learned a lot from him and understood how his company had become world class. World class companies are not built overnight. Leadership plays a vital role in shaping the destiny of any organisation. Some of the common traits of leaders that I have observed are: They have a very clear vision of the organisation; they communicate well with employees; they have impeccable integrity and live by exam-

ple; they are very passionate about what they are doing and dedication is in their DNA; they nurture creativity and allow openness and treat all employees equally; they are very aggressive, yet they live with humility; they take stress very well and do not get frustrated very easily; they do not accept anything less than excellence; and, they are constantly looking at the future. Indian companies must identify and nurture the right leaders and, more importantly, allow them to transform the company into a world class company. Organisation: World class organisations take a lot of pride in their human capital. The quality of its employees is a report card on the world class status of the organisation. These organisations not only attract the best talent, but also retain them. Employees are very well respected in such organisations. Continuous training and development of employees is the hallmark of world class companies. Conducive atmosphere is created so that employees can make meaningful contributions to the organisations. Creativity is nurtured. Employees do not join these organisations just for the compensation packages. They look beyond compensation; they look for recognition, growth, development and happiness. They get plenty of these in world class organisations. Indian companies also have to reach out and should have the insatiable desire to become world class. The need of the hour is the spirit to become world class. The journey is full of challenges, yet it is possible to achieve world class status. I am an optimist. I will be looking forward to the day when I can write an article about how Indian companies have become world class. Perhaps, that will be the proudest day for all of us. Ravi Talluri worked with auto majors in the US and is currently a management consultant focusing on SME and rural development. Ravi teaches at various engineering and management colleges in Andhra Pradesh. He lives in Hyderabad.

Technologically devoid, operationally insurmountable Four lakh daily transactions conducted with an accuracy rate of 99.99% puts the dabbawalas of Mumbai right up there with the highest achieving MNC By Shinjini Ganguli he Nutan Mumbai Tiffin Box Suppliers Association, popularly known as Mumbai’s dabbawalas, have a 120 year old reputation for unerringly delivering home cooked food in tiffin boxes to a huge base of customers across Mumbai. Started by Mahadeo Ha-

vaji Bachche in 1890, NMTBSA, a lunch delivery service, was registered as a charitable trust in 1956. And since then, from about a 100 men, the band of dabbawalas has expanded to a good 5,000, a lot of them semi-literates, who deliver two lakh tiffin boxes – four

lakh transactions – every day sans any error. Considering the chaotic Mumbai traffic and the erratic monsoon patterns, it is no small miracle that the dabbawalas never fail to deliver the tiffin boxes on time. What is more surprising is the fact that

"We don’t understand Six Sigma. We are a bunch of illiterates. But we do know our prime responsibility – customer satisfaction. And to achieve that, we can put in hard work like no one else" Raghunath Medge President, Nutan Mumbai Tiffin Box Suppliers Association

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their logistics system employs no technology to ensure this minimum error rate; it relies solely on human endeavour. This is what makes them superior to any MNC that deploys various technologies while striving to gain perfection. In 1998, Forbes Global magazine conducted an analysis and gave NMTBSA a Six Sigma rating for efficiency, thus placing the company, 85 per cent of whose workers are illiterate, in the league of world leaders such as HSBC, Wipro and Cognizant. NMTBSA’s 120 year old logistics system, where the error rate is one in 16 million transactions, is considered one of the best in the world. “We don’t understand Six Sigma. We are a bunch of illiterates. But we do know our prime responsibility – customer satisfaction. And to achieve that, we can put in hard work like no one else,” says NMTBSA President Raghunath Medge.

Mantra for perfection Four lakh transactions in a day is 58 DECEMBER 2010 | DARE.CO.IN

How they do it

not a matter of joke. It requires an infallible logistics system, continuous effort and ﬂawless technology, as many would like to believe. While the former two hold true, the latter is inconsequential for this manual work driven organisation. The dabbawalas have developed a colour coding system with English alphabets and numerals and their traditional way of using coloured thread, which acts as an ID system for the source as well as destination. The tiffin boxes are painted with codes that indicate the originating station, the code for the dabbawalas at the destination, the recipient’s address in the form of a code for the building name, ﬂoor number, etc., the code for the dabbawalas at the residential system and the code of the destination station. This technique is considered to be far more simple and cost effective than bar coding.

To deliver the lunch tiffin boxes, the dabbawalas walk, cycle and use Mumbai’s suburban trains, which are known to have the highest density of travellers in the world. More than six million commuters travel by train, making the task of the dabbawalas even tougher. However, the simple yet robust system developed by the dabbawalas has helped overcome all these obstacles. The delivery system revolves around strong teamwork and strict time management. The dabbawalas start early in the morning. At 9 am, the full tiffin boxes are collected from homes, messes or hotels, loaded onto trolleys and pushed to the railway station. The boxes are loaded into the luggage cabin of the metropolis’ local trains and unloaded at the destined stations. At this point, the coded boxes are rearranged so that those going to similar destinations, end up on the same trolley. The meals are then delivered – 99.9999 per cent of the time to the right address.

Taking cows to the cloud Chitale Dairy has made skillful use of modern information technology to hone its business processes and save costs

By Shradha Mohanty

hat is it that made a small farm, which started with 300 animals in the 1930s, grow into one of the best known names in the dairy sector today? Chitale Dairy’s CEO, Vishvas Chitale, offers us some insights on how the dairy scaled up over the years. Chitale Dairy was started in Bhilwadi, Pune with the belief of converting dairy farming into an industry. In the early 1930s and 1940s, milk was produced in small farms and consumed by the families themselves. The founder of the company, Bhaskar Ganesh Chitale, started with dairy farming and supplying butter and dairy products, moving on to processing milk and, finally, selling it as a commodity. “Selling milk as a commodity was started by him. He always had an innovative way of thinking and, today, we as an organisation rely totally on innovation to work up the ladder. We were the first ones to pasteurise milk and distribute it. We were also the first ones to sell milk in plastic pouches in the 1970s,” says Vishvas Chitale.

Challenges Chitale explains that with the rapid pace of urbanisation and people requiring dairy products more and more in their daily diet, it became extremely

important for them to meet this tremendous demand. Scalability was the biggest challenge they faced. Among the other things that required constant upgrading were producing more farm animals and enhancing their genetics to obtain quality output. It all came down to looking out for per animal or per farm activity and ensuring that the required amount of output was received from them.

Solution “What we are doing is using IT as a tool to leverage per animal productivity. The farmers produce more milk and, thus, we are able to sell that much more in terms of quantity,” says Chitale. “We started with generic based computers and all the data from the business processes, right from procurement, farmer-supplier milk collection centres where the milk is weighed, farmers’ data records up to when the whole milk gets pooled together – goes into the system and the analysis of that particular raw material or milk is transferred to our databases. So, everything from procurement to dispatch of ﬁnished products is done by computer processes. Earlier, when it was all on paper, you could not scale it. The new business process helped us scale up.”

Implementation Chitale Dairy has 10,000 farmers supplying it milk every day, morning and evening. Recognising the beneﬁts of adopting technology from an early stage, the dairy started with incorporating CP/M operating systems and MS-DOS when it was just coming up. It used these systems for a simple purpose – billing the farmers. The dairy depended on IT for maintaining an accounting system, which included details on receiving milk from the farmers, calculation of fat content, multiplying rates, and advances given. It was important for them because the dairy business is a 365 day proposition. “They supply us their products, so we need to bill them. They cannot bill us because they do not have the infrastructure, we need to receive it and give payment to them – so that’s where we started using IT. That was the ﬁrst use of computers,” explains Chitale. Chitale Dairy started moving aggressively thereon. As the growth of IT and computation took place, it kept changing its business models to adapt to more modern software and applications. From MS-DOS to Windows 2000, it kept scaling up because it was imperative to keep pace with technological advances for its own rapid growth.

The idea is to use the best of what is available (in IT) at the time and move on. Always innovate. Reduce costs. Reduce manpower. Reduce problems. And move to the next and newer system

Vishvas Chitale CEO, Chitale Dairy

DARE.CO.IN | DECEMBER 2010

COVER STORY

GLOBAL ORGANISATIONS

Today, the need for virtualisation has been recognised as being of paramount importance to the dairy. It had a number of servers with similar systems running on them, so it sought server consolidation. Instead of using ﬁveten servers, it began using one server and installed virtualisation software on it. So, for all the servers running in the factories, it took their images and all the images were transferred to VMware servers. As a result, all the business processes – collecting the data, processing it for billing for the farmers, making payments, HR information, CRM, controlling the factory environment – were consolidated with the use of the VMware server, thereby automating the entire process. In order to hold on to its farmer and supplier base, Chitale Dairy has centres where the farmers can get their animals tagged and avail of services such as artiﬁcial insemination, milk recording and insurance for the animals. “We provide them with the best possible package so that they do not go to somebody else,” explains Chitale. “We have tagged 10,000 animals and we hope to scale up to a minimum of 50,000 animals of these farmers. We handle around 500,000 litres of milk every day. So, our whole idea is take the cows to the cloud. We want

to take all this data to the cloud so that they can get the beneﬁt of clouding and that’s how we hope to make IT enabled farmers.” Chitale says these ideas came to him when he was introduced to OSS by a few people from Germany and they inspired him to think how technology could provide an impetus to his business and also make it more affordable.

Benefits Instead of ten physical servers, Chitale Dairy now has one VMware server. This is beneﬁcial in many ways. Power consumption has reduced and reliability has gone up because, now, they use a fewer number of hard disk drives. They could make crores of these servers or, in other words, copies of these servers. Reliability has also gone up because had there been only one server and it had gone down, everything would have had to be recreated – probably taking one or two days. This kind of industry, which functions on a 24/7 cycle, cannot afford that kind of turn-time. So, in the event of problems, VMware helps them to just roll back and retrieve the system information. This takes care of back-up management. For Chitale Dairy, constant availability 24/7/365 is very crucial for running the business.

“As the IT industry has grown, and newer and newer solutions have become available, we have just been using the best of the systems and applications available at that time. The idea is to use the best of what is available at the time and move on. Always innovate. Reduce costs. Reduce manpower. Reduce problems. And move to the next and newer system,” says Chitale. He adds that IT has always been treated as a white elephant. He emphasises identifying and implementing products that give good value for money. “To take away the costs, we use the best of the hardware available, like the Dell M1000E chassis. We went for value for money hardware, and instead of servers, we used VMware to reduce costs. If you make IT more cost effective, it becomes more productive. In the long term, IT is encompassing all business processes,” he says. Chitale Dairy has emerged as a quality conscious organisation in adhering to newer technology to provide quality products to its customers. Everything from collecting, processing, packaging and distribution is being done through IT. This has helped in timely delivery of services. Any delay in the process could turn the milk sour, rendering an entire day’s work useless.

Fostering quality education by Smartclass program Even the strongest business enterprise can not ignore the seven letter word "quality" that can make or break the company’s accomplishment By Sharmila Das ducomp thrives to create innovative products that enhance the teaching-learning process. Their products have been developed to solve speciﬁc problems in the education supply chain. Smart Class is a response to the desire for better

60 DECEMBER 2010 | DARE.CO.IN

academic performance in schools examinations and lack of concept clarity amongst students. Despite the quality, Educomp was skeptical of the sale, since the Smartclass program involved signiﬁcant investment on part of schools, in terms

of hardware. However, within a short period, Educomp innovated the business model and pioneered a concept in which instead of asking schools to cough up huge sums of money at one time, Educomp divided the total charge into an

easy monthly subscription for each student. This made it very easy for schools to adopt Smartclass. Today over 4500 schools and roughly 5 million students use Smartclass across India and the numbers are going up rapidly. A case study to exhibit how the education solution provider attained quality education solution provider reputation. Mary Immaculate High School, Bangalore was facing difficulties in getting desired academic performance. The pile of text books and well trained teachers were not enough to ﬁll the void. The school was in the lookout of innovative ways to deal with the challenge and they found it in the form of Smartclass, a technology enabled education method from Educomp Solutions Ltd.

Client profile Mary Immaculate High School, Bangalore. Principal – Sr. Maria Laila Strength – 1300+ students Established – 1956 (53+ yrs)

Task At Mary Immaculate High School, Bangalore classes were not student centric & not effective. Teaching subjects like History was not easy. It was difficult to engage students with complete focus on what was taught. Handling multi level intelligence among students was very challenging for the teachers.

Solution Educomp Solutions Ltd. installed Smartclass at Mary Immaculate High School, Bangalore. Smartclass improved teachers’ efficiency and productivity with its well structured and customized digital content. Smartclass education method brought life to abstract and difficult curriculum concepts thus making learning an enjoyable experience for students. It enhanced multi-sensory learning in classrooms, improving academic performance of students and ena-

“Educomp has been providing Smartclass solution over a decade now. With this solution, teacher teaches “how the planet revolves around Sun”, more effectively. For installing Smartclass program schools do not have to bear the pain of making payment at one go rather the monthly installment arrangement is a win-win situation for us.”

Abhinav Dhar Director K-12, Educomp Solutions Ltd bling instant assessment of learning outcomes in class. The program enabled teachers to use digital resources such as graphics, animations, 3 D images and video clips in addition to the chalk and talk methods of teaching in classroom. The Smartclass content repository consists of thousands of animated, lesson speciﬁc, 3D and 2D multimedia modules built with an instructor-led design that allows the teacher to effectively impart the lesson in a typical classroom of diverse set of learners. The Smartclass TM

“We are judged by a new yard stick today, not only just how skilled we are in teaching but also by how smart we are in using technology in our teaching. Smartclass has allowed us to use technology smartly, in a way in which teachers have been able to conduct classes more productively and students find classes more interesting”

Maria Laila Principal, Mary Immaculate High School, Bangalore

program uses technology to make a different classroom experience. A knowledge center set up at the school acts as the nerve-center of the network. It is connected through campus-wide network to the existing class rooms that simply turn into ETECs ( Educomp Technology Enabled Class rooms). The Smartclass package costs 50/60 lakh for schools with 30/40 classrooms. Its a huge investment for a school. But with the monthly installment arrangement Educomp made it possible for the schools to take the beneﬁts of Smartclass program and foster quality education.

Benefits • Educomp’s Smartclass program has enabled Mary Immaculate High School to offer their students more enjoyable & interesting classes. • Teachers are able to conduct classes in a more organized manner. • Students are able to understand abstract concepts more easily. • Instant assessment through Smartclass program ensures that teacher is updated on student’s comprehension level in real time allowing her to take remedial action. • Student performance has gone up overall. DARE.CO.IN | DECEMBER 2010

COVER STORY

GLOBAL ORGANISATIONS

Leadership tips for being world class Y

ou emphasise discipline so much, can you throw some light on why we are so obsessed with discipline?

I had an experience in one of my seminars, which opened my eyes to the problem of lack of discipline in India. I was moderating a discussion at the Indian headquarters of a Chinese company. In the course of the discussion, one of the senior members in the audience started bragging about how India would overtake China soon. Immediately, the head of the Chinese operations said, “People here don’t even come to office on time. How can you talk about India

overtaking China?” This obviously tensed up the atmosphere a bit, but it was an absolute fact. Coming on time and being responsible for your actions is all a culture that you build into your organisation. Culture and discipline are closely related to each other.

Do you think we can ensure that kind of discipline in the modern workplace? Look at companies like IBM, which has offices in thousands of locations and they have been able to enforce discipline. Look at a company like Tata, which has a well deﬁned code

Virender Kapoor is a leadership coach and an author. His most recent book, Rise and Rise of Jugaad, has just been released. Kapoor was earlier director of Symbiosis Institute and is now running the Management Institute for Learning and Excellence in Pune. Kapoor brings a down to earth and fresh outlook on an issue that confronts us all in our pursuit of global excellence. He removes the aura of mysticism that surrounds leadership and makes it accessible to everyone. DARE spoke to Kapoor on key issues leaders face in today’s global business environment 62 DECEMBER 2010 | DARE.CO.IN

of conduct, and they have been able to enforce the same level of discipline across their group companies. If your intent is right, then I don’t think multiple locations will be a roadblock for bringing in discipline. As a leader, you have to ensure that you do not take the path of least resistance, be soft and crave for cheap popularity thereby. You have to hold continuous reviews with people in remote locations and carry a level of trust so that they are comfortable reporting precise information and do not provide a wishy-washy picture to avoid punitive action. That is the key.

How does the philosophy of being fair to all look in the perspective of what Jack Welch says about differential treatment to stars and farmers in a company? If Mr A has committed a mistake and you have given him punishment Y, when Mr B commits the same mistake, you cannot give him a different punishment. You have to reward and punish equally. Do not be biased and don’t have any personal or emotional attachments. It should be well known that whatever you have done, you will be punished as per the book and it can’t happen any other way. In an organisation, you have to set up a feeling of trust so that whenever someone comes with a complaint, he knows that he will be treated fairly. The leader has to demonstrate that his behaviour is the same under all circumstances with everyone.

What should a leader keep in mind in the pursuit of fairness? You can’t break the rules, but you can bend them. So, bend them, provided it is for the larger good of the organisation, and not for your personal gain. When you are in a position of leadership, there is a lot of responsibility on your shoulders – you should understand that. And if you want people to follow you, you’ve got to show things which will demonstrate that while you are harsh when it comes to discipline, you can bend for the good of the organisation. All this is circumstantial. The leader will have to take responsibility, a certain amount of risk and be thoughtful about his actions.

You talk about giving oneself time to settle down – is this possible in this rush hour? It depends on what kind of task you have on hand. If you are a large organisation, you really require more time. If you are steering a Titanic, it will take more time (to turn it around), and if you are steering a speedboat, you can turn it around quickly.

If you are in a very large organisation and you have the task of turning around some part of it, you cannot do it overnight. This cannot be done by looking at a few emails and talking to a few heads of department. You should have time to settle down and take a stand on the state of affairs. You must understand your role, your team and then only can you start performing. Do not rush into performance too fast. Today, every organisation has different problems and you are expected to solve them. You can’t say that the past leader messed it up. The top brass should understand this situation and say, look friend, take some time, understand the issues at hand and then start performing. You can’t expect the leader to start performing from day one. So I would say, don’t be too slow, but do not be too fast either.

How do you think organisations should structure their appraisal reviews? I really feel that normally, reviews become more about performance evaluation, where you put a guy in a spot telling him what he did right and what he messed up. I think reviews should be more like continuous feedback. It need not be too often, as in every 15 days, but also not too far spaced out, like once in a quarter. You should have a bi-monthly feedback opportunity where the manager talks to his team member and offers feedback and also seeks feedback. By doing this, you will avoid taking the team member by surprise at the end of the year.

Delegation is an evil word, yet people cannot operate without it – where’s the gap? Leadership is all about managing time and resources. Typically, they are inversely proportional. That is when we come to the question of delegation. Here, the biggest issue is people hesitate to delegate. Most often, people want a 100 per cent return on what they delegate. This is what many call

perfectionism. You’ve got to accept that the rate of getting things done will not be 100 per cent. Once you accept this, people will be more at ease delegating. Another issue is of the capability of the person to whom you are delegating. It is an art to get things done. It is not always that you will get the right skills for your job. You have to train the resource and delegate the work with thorough detailing. It is always safe to make your instructions as clear as possible. Remove any ambiguities in your instructions. And depending upon the seriousness of the job, identify points at which you will seek a progress report from your team member. The third thing to do while delegating is to plan thoroughly. General Montgomery used to plan his battles very thoroughly and then he would let the ﬁeld commander who was ﬁghting on the ground take decisions as required. Having done his planning, the general was fairly sure of the various outcomes.

How can somebody build a good organisational culture right from the beginning? Culture is like a spoonful of curd put in one litre of milk – it is that important. You can adopt Six Sigma, get ISO certified, but you cannot build culture just as you did with the certifications. Culture has to be built and built right from the beginning of the organisation. We see it seeded during the nascent stages of the organisation. Today, it is not enough if you do things right, you need to say that I will not allow others to do wrong. It is a national priority. We have to fix our culture of culture building. We are individual-centric, we are not society-centric. We have to take care of our culture. Culture is our ultimate ambassador. Virender Kapoor is an educationist and an author. He was Director of the management Institute under the Symbiosis umbrella. He later started MILE-Management Institute for Leadership and Excellence located at Pune.

DARE.CO.IN | DECEMBER 2010

STRATEGY

STARTUP

The Changeover:

Make it big and visible While entrepreneurs do understand the importance of professionalizing their business, many do not know when to seek external help. Read on to find out what should suit you best

couple of weeks ago, a media report said that Kishore Biyani, has asked his family to keep off from operations of group’s various businesses so that professional managers can run the companies. It is public knowledge that Biyani has been infusing professional blood into his various group companies in an effort to corporatize the group. More than a decade ago, Bangalore-based and family-run MTR group had to woo a senior official of an MNC ﬁrm for nearly an year to take up the mantle of leadership. The biggest concern for the professional candidate was the discomfort with the fact that a family-run organization or enterprise would not offer him the bandwidth for professional management. Both above mentioned anecdotes have a common message for entrepreneurs. Quality manpower is always a constraint if the organizations don’t shed the tag of 'family ownership'. Earlier the tag is removed, better would it be for the companies to carry forward. The challenge is of even bigger magnitude in the case of sole or small enterprises, which have had to contend with increased competition. Going forward, the task is likely to get bigger in the highly competitive globalised environment. I am sure every entrepreneur is aware of the fact that he needs to professionalise his business to move to the next level of growth. The challenge is when and how to go about the task. Is there a time

64 DECEMBER 2010 | DARE.CO.IN

frame for an enterprise to turn for external help or should one start with the task from day one? The latter is a good option if the enterprise has the ﬁnancial help! Since most small and mid-sized companies face the challenge of ﬁnancial and human resource management, it is imperative that they have to look at the option of professionalizing the business over a period of time. As pointed out earlier, most entrepreneurs are aware of the fact that they need to corporatize the management but the challenging task is to when to go about the exercise. One of the pointers is lack of time for business development. When an entrepreneur suffers from lack of time for business development, it is a clear signal for manpower expansion as by not utilizing the opportunities for business growth, the opportunity cost is huge. The expansion can be two-fold. One is to have the additional resource for operational management as this would enable the entrepreneur to focus on key areas. In fact, a senior official of a leading technology services company during a chat commented, “ If you do things which can be performed by people with lower skill, you are highly under employed”. It holds good not merely for employees but also for entrepreneurs. A few simple strategies can address the problem: 1. Team for operations: While focus on business development is a necessity, an organization can be deprived of organic growth due to lack of focus on customer relationship. A robust back

Quality manpower is always a constraint if the organizations don’t shed the tag of ‘family ownership’

office and a strong CRM (customer relationship management) can address the problem. The first expansion in an organization can begin with this all important vertical. Since, talent acquisition is not a challenge in this space, put in place a strong back office/support team. 2. Empower your existing resources: Besides an entrepreneur, it is important for the employees to realize the changing phase of the organization. The task can be achieved when an employee is aware of his career path. Not only does it keep the motivational levels high but also ensures retention of talent. Irrespective of the size of the organization, communicate to your employees about the regular achievements of the organization. 3. Self empowerment: One of the big changes in the last decade has been the changing face of education system in India. Today, age is not a bar for an aspiring student and the growing integration of education system with industry has resulted in the launch of management courses for working professionals. Educational institutions like Indian Institute of Management offer management courses at regular intervals for practicing professionals. An entrepreneur can make use of the same to hone his management skills. While the areas of interest can depend on the individual/organisation’s needs, a qualified course in the areas of management and finance can do a lot of good to entrepreneurs.

Srikala Bhashyam

4. Focus on improvement of infrastructure/resources: The ﬁrst step towards an organizational growth begins within and this could be in the form of better work environment, better skilled manpower and better practices. While the latter is a relative term and is a continuous process, the earlier two factors are visible and easily appreciated by employees. For instance, a sophisticated and well-equipped office environment is a big motivator for a start-up. While garages are ideal space for start-ups, a long stint for employees in a garage does not ensure talent retention! In a nutshell, an organisation’s transformation of small to big has to be a continuous process but the seeds for change need to be sowed at an early stage. While the timeline for the same could differ and depend on sectors, a B2C organization has to embrace some of the changes in quick time. As the going goes, it is not enough for an organization to be in the pink of health. For the next level of growth, all stakeholders, employees, customers and vendors too need to comprehend the good health of an entity.

Srikala Bhashyam is an investment consultant and runs her own consulting ﬁrm in Bangalore. She has been a regular columnist for the print and internet media on personal ﬁnance. To write to the author, please send an email to dare@cybermedia.co.in with the subject line 'Srikala Bhashyam'. DISCLAIMER: The views expressed here are that of the author and do not represent the magazine's.

DARE.CO.IN | DECEMBER 2010

EVENT

NASSCOM

NASSCOM shows the way The NASSCOM Product Conclave and Expo 2010, which was held on 10th and 11th of November at Hotel Lalit Ashok, Bangalore was a great platform for entrepreneurs to learn and network

By Shradha Mohanty

he two day NASSCOM Product Conclave and Expo 2010 kicked off to a great start. This year, the conclave focused on opportunities in cloud computing and lean start-ups and there was a wide array of workshops, panel discussions and talks to encourage entrepreneurship in the product ecosystem. The NASSCOM Conclave was an excellent platform for entrepreneurs, especially those who were new in the ﬁeld, to get an idea of how to expand their businesses. Experiential talk from entrepreneurs such as Carol Bartz, CEO, Yahoo Inc.!, and Amitabh Srivastava, SVP, Server and Cloud Division, Microsoft Corporation, helped

newer entrants to gain a perspective on what it takes to become big and to look at new opportunities in cloud computing for their ventures. In addition, there were panel discussions on topics such as what an angel investor wants to see in an entrepreneur and the smaller issues that often get overlooked while running a business. Sharat Sharma, President and CEO, On24 Inc, gave a talk on ‘Where You Start is Probably Not Where You Will End Up’. Vivek Wadhwa, Director of Research, Centre for Entrepreneurship and Research, Duke University gave a lecture on ‘Debunking 5 Myths of Lean StartUps’ which helped entrepreneurs

gain some clarity in their business from people who had ‘been there, done that’. The conclave was conducted in the wake of the Indian software product industry gaining momentum and reaching inﬂection point, and this was reﬂected in the eclectic mix of entrepreneurs, ideas and products packaged there. While some of the sessions packed a punch, others were heavy with technicalities. The discussions were informative and thought provoking and, all in all, the event provided a brilliant platform for entrepreneurs to network. Here is a round-up of the highlights of the NASSCOM Conclave:

What are the traits of a successful product entrepreneur? In a power packed session, Professor Vivek Wadhwa, Director of Research, Centre for Entrepreneurship and Research, Duke University, and Vishal Gondal, CEO, IndiaGames.com, debated whether successful entrepre-

neurs are made or born with the traits that ensure their success. While Wadhwa based his arguments on research and statistics, Gondal pointed out a number of the obvious problems that exist in the Indian ecosystem and how these could not be addressed through research. Both had different points of view and kept the audience engaged throughout the session.

Vivek Wadhwa

Laura Parkin, CEO, NEN hosting the panel discussion on ‘Traits of a successful product entrepreneur’

66 DECEMBER 2010 | DARE.CO.IN

There are a lot of wrong assumptions on what an entrepreneur is. The common myth around Silicon Valley is that an ‘entrepreneur’ is a young white male, who is a college dropout, and sometimes, they may come

across as Chinese and Indians. In all the research that I have conducted and papers that we have published, we have found out that the average age of an entrepreneur is 39. Among the 500+ successful entrepreneurs we have interviewed, we saw that the major criteria that make a business venture successful is the experience that the entrepreneur has gained in his work, his management team and, of course, luck it is crucial. It is safe to say that entrepreneurs are made, not born. When you are an entrepreneur, you need to ‘fail fast’ and ‘learn faster’. We need to understand that most of the learning of a product entrepreneur

can actually be received in the service sector itself. You learn a lot there, you learn how to sell to a customer, you learn how to provide customer satisfaction. A lot of these valuable skills you learn here, which applies to product enterprises.

Vishal Gondal You cannot really deduce from research if entrepreneurs are born or made. The real issue is ‘knowing the path and walking the path’. Our ecosystem is not smart enough to

teach us or does not have a proper guideline to become a product entrepreneur. We need somebody who has ‘climbed down Mt Everest and shares his experience’ with us to tell us the way to success. Our SME ecosystem is scattered. Hence, it’s all about which entrepreneur can make it on his own. As a product entrepreneur, you need to understand what the customer wants because the customer here himself does not know what he wants. The major challenge that

a product entrepreneur faces is the business model that he needs to follow. It’s all about finding the optimum solution for customers and not just throwing more people into developing the product. You need to balance the two out. Also, one very important issue that a product entrepreneur should keep in mind is to know when to pull out. Do not get obsessed with the products if you see them failing more than three times. That’s when investors and mentors come into the picture.

The new Internet: An economy of scale and partnership Carol Bartz, CEO, Yahoo! Inc., emphasised the need to change faster, partner better and to listen to your customer in order to build a successful products and services company. In an interactive session with Pradeep Kar, Managing Director, Microland Ltd, Bartz covered a lot of ground, ranging from working with entrepreneurs to building social networking capabilities into your products.

On being a content providing company If you are working in the new Internet economy, your prime objective is going to be how to provide a plethora of content to a whole lot of people who cannot reach them. Consumer behaviour has changed today. They come to the Internet to use, absorb and gain knowledge and, whether they understand the technology behind it or not, they have come to realise what it means to their lives.

development. There are good ideas outside the company of all kinds, be it technology, content, anything. There are three important things in the kind of business we are in content, technology and reach. You need to take risks, grow and expand and that you learn when you partner with somebody. Having a protectionist attitude does not help.

On what cloud computing can do for companies Cloud computing is really going to be helpful for smaller companies today and it is absolutely necessary for large companies to incorporate it. For the smaller companies, it helps a lot in saving. You have somebody else to manage the infrastructure. You save a lot in electricity and access to bandwidth. In the case of large com-

On how social networking has evolved In Web 1.0, the whole system, I would say, was pretty much "static". Other than consuming information, nothing much was seen to be happening. You had messaging, mail and chat mail. That was as far as "social networking" could go. People became familiar with the concept. With Web 2.0, everything became more dynamic. The consumer was kept engaged because every bit of information, including advertising, became interactive. Web based products today need interactivity and Indian companies should keep in mind how important a role social networking plays today.

On what is the need of the hour Entrepreneurs today are coming up with ideas with excellent analytical abilities, but they should realise that it is not just about ideas. It is crucial to understand what "product marketing: is about. Test your ideas and revise your product before sending it out.

On partnerships In a company like Yahoo!, which caters to 630 million users, we also understand the need for getting into partnerships to provide enhanced user experience to our customers. In order to be successful, both sides should take equal interest in product

panies, you get content legibility. We can get stories from anywhere and put it up anywhere.

Carol Bartz, CEO, Yahoo! Inc. discussing about The New Internet: An Economy of Scale and Partnership

To read more stories, snippets and quotes from the event, do visit our website: www.dare.co.in

DARE.CO.IN | DECEMBER 2010

STRATEGY

STARTUP

Want funding for your start-up? Tell a story! What is a meticulously drafted business plan but a riveting story that combines logic with emotion? The mission of award winning story teller and strategy expert Robert McKee and his ever growing disciples are proof of how a welltold story can do what an Excel sheet cannot to get a start-up going

or over a quarter of a century, award winning director and writer Robert McKee has been evangelizing a growing swell of screenwriters, filmmakers, novelists and journalists on the nuances of fine writing across continents. McKee is the creator of Story Seminar, a much sought after series of lectures that lace McKee’s own experiences with lessons drawn from the movies to help people communicate persuasively and effectively, much like a bestselling paperback. While much of McKee’s work and advice is aimed at performing artistes, his concepts of storytelling are just as relevant to entrepreneurs who McKee believes might be able to get their way far more effectively if only they put aside their power-points and memos and told a story, instead. A strong believer in “uniting an idea with an emotion”, McKee, recently told Harvard Business Review: “In a story, you not only weave a lot of information into the telling, you also arouse your listener’s emotions and energy,” he told Harvard Business Review in an interview a couple of years ago. Every start-up has a story behind it. Most successful entrepreneurs would acknowledge that either a particular turn of events in their lives or their disgust with existing systems and processes provided the impetus for the ideas they customised as startups. Of the several entrepreneurs I have had the opportunity to meet or interview, many have told me of the problems they faced in their personal lives, which set them off on a journey to seek solutions. Kranthi Kiran Vistakula, the founder of Hyderabad based Dhama Innovations, is one such entrepreneur and innovator. While studying at the Massachusetts Institute of Technology in 2004, Kranthi had to wear multiple layers of clothing while outside his class

68 DECEMBER 2010 | DARE.CO.IN

and remove them when inside. This got him thinking “why clothes couldn’t be air-conditioned”. It resulted in him working on a technology that now creates apparel and accessories to provide heating and cooling on demand.

How to Tell Your Story It may seem quite daunting to tell a story to a group of people you are seeing for the first time. For an entrepreneur, however, it is often an imperative, the need to break out of one’s shell and share a story with a diverse audience: investors, customers, suppliers and employees. An array of business plan competitions have made it mandatory for aspiring entrepreneurs to make compelling presentations of their dream ventures. Numbers are beautiful and investors love to see them, but many angels and VCs pay signiﬁcant attention to the stories behind the start-ups. They want to know about the team members and the ideas that bind them together. Poring over Excel sheets to prove the viability of your start-up can take you only thus far – focusing on the reasons that make you passionate about your start-up is equally important. It is always advisable to align your thoughts beforehand to avoid bouncing aimlessly from one point to another. Here are a few areas to focus on while telling the story of your start-up: Be Passionate: This has plenty to do with your belief and conﬁdence. If you believe in yourself and your idea, there is no reason why your voice and body language should convey a different message. Focus on your thoughts, actions and words, instead of your fear and hesitation. Talk of the Idea: This is where it all began — with an idea. Take a leap back in time to tell how the idea

Numbers are beautiful and investors love to see them, but many angels and VCs also pay signiﬁcant attention to the stories behind the start-ups

came about. It could have been a life-changing event or an interaction with a friend or a colleague. Your idea could have germinated from a problem you faced over time or you saw someone else caught up in. Talk about the thoughts that passed through your mind and what prompted you to believe that your idea could change the lives of people around you. Even if you read about the opportunity in a journal and decided to develop it, let the world know. Show the Opportunity: Before you let others see the opportunity that exists, carry out enough research to support your claim. Picking up pieces from market research reports that claim the hefty size of the opportunity alone might not suffice. If you are clear about the geography your start-up would operate in, do your own research to ﬁnd out how many prospective cus-

Vimarsh Bajpai

tomers are waiting for the product or service that you want to offer. Share Your Vision: Before you talk of the vision that you have for your startup, visualise where you see your business five-seven years from now. If you have plans to go global in the second year, make a compelling case for it. The clarity with which you show the roadmap for the success of your startup could have a huge impact on the judges at any B-Plan competition or the investors who plan to invest in your venture. Complement this part of the storytelling with a presentation that shows the milestones that you plan to reach over time. Reaffirm Your Values: A good business is not just about revenue figures. It has a lot to do with the business culture that the company creates for itself and its employees. Therefore, as the founder of a company, you ought to know the values which are dear to you and which you would want to see, not just on the wall as a vision statement, but in everyday practice. If you are true to the values you believe in, it will be easy for you to reaffirm them every time you talk of your startup. Make a list of five core values that you would want your employees to put into practice. Vimarsh Bajpai is an entrepreneur, writer, and content and communications consultant. As the founder of Samvad Sutra, he works with organisations and individuals to help them communicate better.

DARE.CO.IN | DECEMBER 2010

STATISTICS

INVESTMENT

Private Equity/Venture PE Investments

VC Investments* 29 11

9 24

497

240

October 2010

October 2009

No. of Deals

Amount (US$ M)

October 2009 Amount (US$ M)

No. of Deals

SOURCE: Venture Intelligence PE/VC Deal Database

* VC investments are a subset of PE SOURCE: Venture Intelligence PE/VC Deal Database

PE investments by city Year

Total Number of investments

Trends in Tier- 2 investments

Investments in Tier 2 citites*

Investments in tier 2 cities compared to overall investments

% of total investments

2010

268

2009

214

2008

415

Amount (US$ Millions)

No. of Deals

1.2

SOURCE: Venture Inte ligence PE/VC Deal Database *These numbers exclude Tier 1 cities i.e. Mumbai, NCR, Bangalore, Chennai and Hyderabad

Tier 1 cities include â&#x20AC;&#x201C; Mumbai, NCR, Bangalore, Chennai, Hyderabad PE firms are increasingly looking for investment opportunities in tier 2 cities for instance in October there were as many as 7 investments into cities such as Ludhiana, Kolhapur, Jaipur. 70 DECEMBER 2010 | DARE.CO.IN

US$ Millions

0.8

23 0.6 22 0.4

0.2

20 19

0 2008

2009

2010

Source: Venture Intelligence PE/VC Deal Database

Capital in October 2010 Top PE investments in October 2010 Company Avantha Power & nfrastructure

Industry

Energy

Investors

KKR

IVRCL Assets & Holdings-1

Engg. & Construction

Ascent Capital

Celon Labs

Healthcare & Life Sciences

Sequoia Capital India

Telecom

Cisco, Nokia Growth Partners, Fidelity, Nexus Ventures

NetMagic Shreem Electric

Energy

Fidelity

Top VC investments in October 2010 Industry

Investors

Amount ($ M)

Celon Labs

Healthcare & Life Sciences

Sequoia Capital India

Media & Entertainment

SAIF

Associated Broadcasting Company

Energy

IFC

SunBorne Energy

IFC

4.5

Rajasthan Housing BFSI Finance Project Exclusively.in

Helion Ventures, Accel India

2.8

Amount ($ M) 49

Company

SOURCE: Venture Intelligence PE/VC Deal Database

IT & ITES

SOURCE: Venture Intelligence PE/VC Deal Database

Top Investments in Tier 2 cities in 2010 Company

Investor

City

Amount $M

Date

Panchshil Realty

Xander

Pune

110

Jul-10

Sadbhav Infrastructure Project

Norwest, Xander

Ahmedabad

Aug-10

Nectar Lifesciences

New Silk Route

Chandigarh

Feb-10

Jagran Media Network

Blackstone

Kanpur

Apr-10

Asianet

SIDOFI

Tiruvananthapuram

Sep-10

Source: Venture Intelligence PE/VC Deal Database

DATA SOURCE:

DARE.CO.IN | DECEMBER 2010

TECH CORNER

VIRTUALIZATION

Virtualization for Growing Businesses

72 DECEMBER 2010 | DARE.CO.IN

Virtualization is all about bringing efficiency in the workplace, and a growing business needs this efficiency to continue on its growth path. So if you’re a growing business, then make your IT infrastructure virtualization ready from day one By Anil Chopra he term virtualization doesn’t need any introduction to anyone. It’s amongst the hottest buzzwords today, and the ﬁrst question that comes to the mind of any CIO is whether to go for it or not. But this question can only be an-

swered by ﬁrst answering whether you really need it.

Who needs virtualization? The key aim of adopting virtualization is to improve efficiency in the data center. Virtualization brings in efficiency by putting more load on lesser hardware, so that it becomes easier to manage, consumes lesser power and physical space. But that still doesn’t mean that every organization needs virtualization. Everybody needs efficiency, but virtualization may not be the best way to bring it. So for an organization that doesn’t have a lot of IT equipment, it might be cheaper to continue using it, or perhaps outsource it to, say a SaaS provider. Let the SP take care of the management of all your hardware resources, so that you can focus more on your business. A lot of small organizations would ﬁt into this category (unless they are software development houses, BPOs, etc where IT usage is heavy), and therefore may not really need virtualization. But if you’re a growing business, and are likely to add more intelligent workforce in the workplace, for whom you’ll need to provision IT equipment, then your organization could be a prime candidate for virtualization. In such a case, you’ll plan your IT setup to be virtualization ready, so

that it’s highly efficient from day one. The sweet spot here again has to be determined by checking how much would it cost to deploy your own hardware for running enterprise apps vs outsourcing it to a Cloud Computing SP. Last but not the least (because they’re always taken as the ﬁrst example for virtualization) are organizations with a lot of bloatware—lots of IT equipment (servers, storage, networking) in the data center, which is taking up lots of physical space, consuming a lot of power, and remaining underutilized most of the time. This organization would be a prime candidate to go for virtualization. So you’ll need to calculate how much you’re spending in running all that equipment, and compare it against the cost of bringing in virtualization. If the cost is less than the cost of managing it all, then you obviously know the answer. It’s not necessary that every large organization requires virtualization. If you’re a large manufacturing house, but most of your workforce is sitting on the assembly line, then you may not need it. But even if you’re a mid-sized organization with a moderate to heavy IT workload, and growing, then you should seriously consider virtualization. In the pages to follow, we’ve covered everything you need to know about virtualization and why you need it—the technology, the products, the cost, and beneﬁts you can achieve.

DARE.CO.IN | DECEMBER 2010

TECH CORNER

VIRTUALIZATION

Virtualization At What Price? Virtualization is being touted as the key to operational efficiency and cost reduction in data centers today. Let’s look at some broad ‘cost’ areas which organizations should a give a thought before moving onto virtualization By Amrita Premrajan

efore you start realizing the savings from virtualization, it’s important to understand the cost associated. It’s important to know how much money you’ll have to shell out to deploy the technology, and then calculate the resultant savings. This will help you determine whether to go for virtualization or not. Any virtualization deployment can be broken up into the cost of hardware, the virtualization software itself, cost of licenses for the OSes and apps you’ll be running on this platform as virtual machines, and the cost of service and support. There would also be the cost of management tools that would come in, which depends upon the level of management you’d like to do. These would also vary for different platforms.

Free or paid virtualization software The good thing about virtualization is that there’s both free and commercial platforms available. Which one to go for depends upon several things. One, if you have sufficient in-house technical expertise, then you could go for the freely available solutions. Two, you need to check whether the free 74 DECEMBER 2010 | DARE.CO.IN

solutions have any limitations. For instance, certain free virtualization platforms limit the maximum number of virtual machines you can set up on them. Another limitation could be the types of operating systems it supports. If it doesn’t support the OS that you’re using in your organization, then the virtualization software will be of no use for you.

The real cost of virtualization Setting up virtualization is the easier part. The difficulty comes in managing the same. As you get used to virtualization, you’d be tempted to put more and more virtual machines on the server. Then you’d want to backup those virtual machines on a separate machine, and ensure their images always remain updated. You might also then want to have a failover machine setup, so that in case a virtual machine fails, there’s a backup that takes over. You’ll need tools to do all these functions, and the freely available ones may or may not have all these. Let us look at some of the cost-related concerns that an organization may have to go through while thinking of virtualization.

Assessing the cost of hardware The ﬁrst question that comes to an entrepreneur’s mind before investing in virtualization is about the kind of hardware that would be required for virtualization, how much would it cost and what to do with the existing hardware. You could ﬁrst check in house to see whether your existing servers could be used for virtualization, before deciding to buy new ones for the job. You’ll also need to check whether the hardware itself is virtualization ready or not. In x86 servers for instance, the CPUs from Intel and AMD use technologies with builtin virtualization support. If these are not supported, then the platform may not be suitable for doing virtualization. Let’s look at the how your current computing platforms lying in your datacentre could be possibly used in the virtualization infrastructure and the new generation servers ideal for virtualization infrastructure. 32-bit Servers: If you are currently using 32-bit machines in your data centers, you could think of repurposing them for virtualization. Though the performance

and reliablity of these machines would be good for one application, one server mode, but when talking about the number of virtual machines that could be installed per server and its functionality, you might not get great results. A 32bit hardware would allow for only very limited expansion of important resources, like memory and card slots. Such hardware could be repurposed and used for low density virtualization, development, QA etc. 64-bit Servers: The 64-bit servers in your datacentres have greater memory and could support more number of virtual machines. But you’ll need lots of memory to do virtualization. Having 4 GB or 8 GB may not be enough. So check whether there are sufficient memory slots to upgrade the memory on these servers. They could be repurposed and could be used for medium density virtualization, development and QA. New Generation Servers: The new generation servers are capable of supporting very high memory that range from 32 GB to 128 GB. They would also contain multiple card slots that can hold NICs and HBAs and they would be equipped with latest generation of processors that are virtualization enabled.

Cost of Software Talking about the hypervisor products, let’s look at what some top vendors have for enterprises. VMware: VMware ESX and VMware ESXi are bare-metal hypervisor architectures, which install directly on top of a physical server and then partition into multiple virtual machines running simultaneously and sharing the same physical resource of the underlying server. These come with VMware vSphere which is a virtualization platform and future VMware vSphere would include only the VMware ESXi architecture.

The major difference between these two hypervisors resides in their architecture and operational management. VMware ESXi is a thin hypervisor that can be delivered as an embedded ﬁrmware in server systems from major OEM vendors or as an installable product that can be deployed by the customers in different environments. VMware vSphere Hypervisor based on VMware ESXi, the hypervisor architecture can be downloaded for free. This free edition of the vSphere production line is licensed to only unlock the hypervisor functionality of vSphere, but it can be seamlessly upgraded to more advanced offerings of VMware vSphere which are paid versions. Microsoft: Microsoft Hyper-V is a hypervisor-based technology which is a key feature of Windows Server 2008 R2 which provides as a scalable virtualization platform. Hyper-V is available as two distinct version, one is the standalone product, Microsoft Hyper-V Server 2008 R2, available via the Microsoft Download Center free of charge. It is also available as a part of Microsoft Windows Server 2008 R2 which is said to be the next generation hypervisor-based server virtualization which is an integral feature of Windows Server 2008 R2. The Windows Server 2008 R2 licensing model consists of server OS license and incremental Client Access Licenses (CALs). So essentially, you’re not paying anything for Hyper-V. You’re just paying for the OS and application licenses. Citrix Xen: This is a server virtualization platform that uses the Xen hypervisor for virtualizing every server on which it is being installed. The free edition of XenServer starts with a 64-bit hypervisor and centralized management, live migration, and conversion tools to create a virtual platform.

Further there are premium editions like advanced edition, enterprise edition and platinum edition which extend the platform to enable organizations of any size to integrate and automate management processes, delivering a virtual datacenter solution.

Other Costs involved While going for a virtualization vendor, it is important for any enterprise to analyse the amount of technical support being provided during implementation of the virtualization solution. Also important is to understand how much would you have to shell out so as to acquire the necessary licenses. So it becomes important to understand a virtualization vendor’s licensing model. A common problem that enterprises face is that once a vendor provides a virtualization platform which might be really great but when it comes to management of the software, the enterprises hit disappointment and end up shelling more time and money. So a fair amount of research about every vendor’s management software for things like live migration, CPU management etc becomes equally important.

Virtualization TCO calculator If your organization has not yet stepped into virtualization, then a good way to start off with is Webbased TCO Calculator that would enable easy estimation of ROI of virtualization and a detailed report of the potential cost savings. Some TCO calculators that you could use are, Microsoft Integrated Virtualization ROI Calculator and VMware ROI TCO calculator which would enable you to calculate the IT savings, business competitive cost savings, and ROI that an enterprise could generate using solutions from respective vendors. DARE.CO.IN | DECEMBER 2010

TECH CORNER

VIRTUALIZATION

The Virtualization Pitch CIOs tell us the what, why, and how of virtualization to help convince the management to go for this technology By Patanjali Pahwa irtualization has been the buzzword for a very long time. It has been touted as the magic wand that would help save valuable funds. While several large companies have been able to clear this concept with their management, the medium sized companies have been unable to get around the management’s resistance to change. The age-old approach of a spacious server room, with imposing machines whirring, and hopefully not beeping, has been phased out. Even traditionalists have advocated the shift to virtualization. But, the biggest obstacle that stops CIOs in adopting the technology is the management pitch. CIOs if you are reading this story pass it to those in management. We, at PCQuest, will give them the virtualization pitch.

then allow other applications to use the unutilised resources hence creating an environment where every single resource is utilised. ‘The biggest problem is when you have all your applications on one server and there is a problem, let’s say with your ﬁle server. You have to shut everything down. The people working on Tally will have to stop working as well,’ said Ma-

How much does it cost?

Why virtualize? ‘Typically, legacy environments have servers running at less than 20% utilization most of the time. Such servers are good candidates for virtualization,’ said Kothandaraman Karunagaran, Director, Global Infrastructure and Enterprise Services, CSC, India. Kamal Goel, VP technology at IIFL agrees. ‘A few applications do not utilize all the resources of the server; hence we use software to virtualise and create multiple virtual machines.’ These virtual machines 76 DECEMBER 2010 | DARE.CO.IN

yanka Parekh, Director, Hazel Infotech. Parekh insisted that to save time and resources virtualization was a necessity. Parekh also explained, ‘My sales guys can access the server remotely and through virtualization can enter their data without sending it to the office in a spread sheet.’ The spread sheet, he explained, would have to be earlier entered into the system by a data entry operator and would increase per employee numbers and the corresponding costs.

“Typically legacy environments have servers running at less than 20% utilization most of the time. Such servers are good candidates for virtualization” — Kothandaraman Karunagaran Director, Global Infrastructure and Enterprise Services, CSC India

It isn’t just the array of server space that will be inherently saved. The technology cuts down on electricity consumption by employing fewer machines and the air conditioning cost therefore drops. Though this might not be enough, but it will in the long term help in carbon credits and add to the green initiative. Also, several solutions are freeware and won’t cost a paisa in the form of third party applications. ‘There is a dramatic decrease in recurring cost. We have reduced couple of racks from the data center and hence get a direct monthly saving per rack per month and now we can provision any server in less than 15 minutes,’ said Kamal Goel. The savings on an average is close to 20 percent on hardware costs. Several smaller costs like that of a strong antivirus software

and backup options can be avoided through hardware virtualization. A virtual machine’s conﬁguration is more ﬂexible than a physical one. A virtual machine can also be controlled and monitored easily than a physical one, while the concept of desktop virtualization reduces the entire concept of a single physical machine.

How does it work? Different types of virtualization solutions can be used by companies. A BPO would be ideal to run hardware virtualization, where a supervisor could control and access the kind of work done on the machines at a single point. The resources needed by these machines are lower and can be sourced from a host machine which could be handling several other clients, thus making it easier for the management to collate data from a single place and make varying analysis. Virtual Memory is one of the more popular methods of utilising resources. Popularly used in companies devoted to coding and designing, this technology lets the client believe it is accessing one continuous source of memory which can be collated from different sources to make it one pool from which client machines access the resource. This method then utilizes the resources which are not being used and employs it for the process. Storage virtualization is used in banks and more popularly where employees constantly deal with sensitive data. This technology presents a logical space for storage and then takes on the actual physical location mapping by itself. The data thus is stored at three different locations on the network without the user knowing the exact spot of storage. Though virtualization is a buzz word, not everyone can switch to this concept. The keyword here is multiple system-multiple places. As one CIO said, ‘You can’t jump into virtualization without automa-

tion. Automation is the first step to virtualization. The accounts department might have shifted but the HR doesn’t. They like paper. The first step to shift to virtualization is automation. The entire company has to get digital.’ Parekh believes the first step is to generate awareness of the product. Parekh very strongly states that the only way to run a successful virtualization project was to establish a strong, very high end robust server. But before the awareness, the CIO has to remind himself of the additions he can make to his armoury which will make working and the turnaround easier. A company with a team of 35 people logging on to the same application virtualizing would be a wasted effort. The CIO has to understand that if the RoI is higher than the current costs only then is virtualization is the switch possible. The next step ‘could be in training the team with a few business

“We have reduced couple of racks from data centre hence direct monthly saving in term of per rack per month and now we can provision any server in less than 15 minutes” — Kamal Goel VP Technology, IIFL

users and to migrate the test setup ﬁrst to virtualization with one or two production servers,’ said Kamal Goel. The process which is can be easily migrated through virtualisation is the ﬁle system. A virtual memory could be the easiest way to start, it has been said to be simplest to implement by industry experts. Peer experience through seminars and white papers is also recommended by industry veterans.

Challenges ‘There is no skilled support staff in the market to help,’ said Parekh, ‘a vendor might tell you that on a virtualized server you can run virtualized applications-no it can’t.’ Parekh maintained that the support staff have not been given enough training, and even though the concept has been around for a while not many have understood the depth of technology. Another problem CIOs spoke about was the high one-time cost. A high-end server of a standard conﬁguration of 64 GB RAM, four processors and terabytes of space will cost in the range of Rs 10-15 lakh, where as a regular server costs Rs 4 lakh. Parekh also explained that several vital applications might not work on the virtualized setup. “If I ask the Tally guys ‘Can your application run on a virtualised environment?’ they don’t have an answer because they don’t know. Not enough awareness.” CIOs have also been agonised over patches. Upgrade patches might render a few tweaks made in the functioning useless. “If HP comes up with a new printer, it might not be compatible in a virtualised environment, what do I do now?” said a CIO. Kamal Goel however, had a solution: plan it so well that you don’t need to come across these problems. The content for this article is sourced from PCQuest Visit their website: www.pcquest.com

DARE.CO.IN | DECEMBER 2010

$OĂ&#x2013;YOUĂ&#x2013;KNOWĂ&#x2013; AĂ&#x2013;YOUNG

INNOVATOR WHOĂ&#x2013;ISĂ&#x2013;GOINGĂ&#x2013;TO CHANGEĂ&#x2013;THEĂ&#x2013; FUTUREĂ&#x2013; OF TECHNOLOGY Ă&#x2013; Since 2010, Technology Review Indiarecognizes the outstanding innovators under the age of 35 from India in our magazine, online and at the annual EmTech India Conference. If you know someone under the age of 35 whose work in IT, biotech, medicine, material science, energy, manufacturing is making a !

Past honorees include: Kranthi Kiran Vistakula

)NDIA

Dhananjaya Dendukuri

Rikin Gandhi

Indrani Medhi

.OMINATIONS

CLOSE $ECEMBERĂ&#x2013; Ă&#x2013; 7INNERSĂ&#x2013;MUSTĂ&#x2013;BEĂ&#x2013;UNDERĂ&#x2013;Ă&#x2013; THEĂ&#x2013;AGEĂ&#x2013;OFĂ&#x2013; Ă&#x2013;ASĂ&#x2013;OFĂ&#x2013;Ă&#x2013; /CTOBERĂ&#x2013; Ă&#x2013;

6 ) * 7)8!

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) * + - / 4&

FAQs What is the TR35? Established in 1999 as the TR100, the TR35 list recognizes the outstanding innovators under the age of 35 each year. The awards span a wide range of fields, including biotechnology, materials, computer hardware, energy, transportation, and the Internet. What is India TR35? It is a list that recognizes the outstanding innovators under the age of 35 from India. We are searching for individuals whose superb technical work holds great promise to shape the next decades. Our goal is to recognize the development of new technology or the creative application of existing technologies to solve problems. We also reward ingenious and elegant work that matters to India and the world at largeâ&#x20AC;&#x201D;not just to peers in a particular field or industry. Technology Review India showcases the TR35 finalists, including our Innovator or the Year, in our March issue. We will also recognize the finalists at our EmTech Conference and awards program in March 2011.

For how long have you been producing an India TR35 list? Technology Reviewâ&#x20AC;&#x2122;s first India TR35 list of 35 young innovators appeared in March 2010. How is India TR35 list chosen? The editors of Technology Review solicit specific information from each nominee. A distinguished panel of judgesâ&#x20AC;&#x201D;technologists, inventors, and entrepreneursâ&#x20AC;&#x201D; evaluates the nominees based on this information. The editors make the final selections based on these judgements. TR35 winners must be under age 35 as of October 1, 2011 in year they are honored. For 2011, nominees may not turn 35 before October 2, 2011. Can a TR35 member be over 35? No, TR35 winners must be under age 35 as of October 1 in year they are honored. For 2011, nominees may not turn 35 before October 2, 2011. Will you make an exception to the age limit? No. The age qualification is the single unifying characteristic of members of the TR35. We realize that exceptional work is being done by innovators who are above 35 years of age; however the premise of the list is to honor 35 under 35.â&#x20AC;? No exceptions will be made. Who are the judges? The TR35 judges are experts in their fields, outstanding

technologists, inventors, and entrepreneurs working in top universities and companies around the world. The list of judges will change each year and will be published with the list of India TR35 winners in the March issue of Technology Review India.

This is simply the nomineeâ&#x20AC;&#x2122;s place of work or study. We provide multiple fields in case of nominee is both working and studying for a advanced degree (e.g., MBA) and in case a student or professor is founding a company. Please do not list professional memberships or the schools where a nominee has previously earned degrees. Does a TR35 have to be at a university? No! Past winners have come from startup, large companies, government agencies, and nonprofits, as well as from universities. We encourage nominations from institutions of all types. Does a India TR35 have to be from India? Yes! We seek only nominations for work done in India. Who should I list as reference? These should be advisors, supervisors, coworkers, or colleagues at other institutions who are familiar with the nomineeâ&#x20AC;&#x2122;s work and who are able to describe the work and its importance. These people should be willing and able to provide a short (approximately onepage) letter in support of the nominee. What are you looking for in the nominee description? This should be in brief, capsule summary of the technical work for which you believe the nominee deserves recognition, including an explanation of its impact, both within the nomineeâ&#x20AC;&#x2122;s field and in the wider world. Can a nominator be listed as a reference? Yes! However, we will request a separate letter of support for the nominee. If you feel the nominee description submitted online is a complete account of the candidateâ&#x20AC;&#x2122;s work and highlights the reasons you believe he or she should be included in the India TR35, please list a different reference. How do I nominate? You can also nominate candidates for this yearâ&#x20AC;&#x2122;s class using the simple form on our website: www.technologyreview.in/tr35/nominate.aspx. If your question is not answered there, feel free to contact the projectâ&#x20AC;&#x2122;s editor srinivasch@cybermedia.co.in.

).$)!Ă&#x2013;42

EVENT

HEADSTART

Entrepreneurs enlighten and entertain the audience in November’s Startup Saturday In the month of November, HeadStart achieved yet another milestone—of reaching out to the masses and sharing knowledge with entrepreneurs from different places across the country, even those living in remote areas where there is a lack of proper guidance and dearth of much needed inspiration. With the November Startup Saturday event in Mumbai being covered by ET Now (to be aired on its show Starting Up), HeadStart is well on its way to create an entrepreneurial revolution in the country.

umbai - Starting Up @ Startup Saturday

The theme of Mumbai Startup Saturday was “Social Media.” The event had social media experts come and share their experiences. The ﬁrst speaker of the day was Gaurav Mishra who made a great case on how it’s the right time for start-ups in India to focus on “Invention” rather than “Tweaks.” Later, Rajiv Dingra of WATMedia (http://wat-media.com/) spoke about the use of social media for start-ups. Startup Saturday, Mumbai, was marked by the unveiling of the Starting Up show on the ET Now channel. Three start-ups introduced their products, in 90 seconds each. Rakesh Deshmukh presented MoTrade, a mobile trading platform with se-

80 DECEMBER 2010 | DARE.CO.IN

cure transaction as its USP. Avinash Anandan introduced Qureka, which helps you discover people with your interests, and Samir Palnitkar presented his start-up ShopSocially, a social shopping experience site. Sudhir Syal of Starting Up moderated a fun Q&A session with the three founders answering questions raised by the audience. This fun session was followed by a talk by Naman Sarawgi, head of Product at Freecharge.in (http:// www.freecharge.in), on the problems solved by them using social media. Dina Mehta then spoke on 10 tips for establishing “Personal vs. Professional Brands on Social Media.” Next, Rohit Varma of Interskale Digital Marketing spoke about how social media is a great tool for start-

ups to reach out to targeted groups interested in their products. The session ended with a talk by Mahesh Murthy on how mammoth companies like Google, Amazon, and Yahoo took off solely through word of mouth and without much advertising.

Startup Saturday, Bangalore The Startup Saturday, Bangalore, was based on the theme “What business is right for me?” The session began with an informative talk by Amit Singh, one of the founding members of HeadStart Network who also heads Startup Saturdays across India. Amit spoke about the idea behind HeadStart, its initiatives like Startup Saturday, the people behind the initiative and the future goals of HeadStart. Amit’s session was followed by an entertaining speech by Shastri Divakaruni, Chairman and CEO of Silk Media (http://www.silkmedia. net). Mr. Shastri emphasized on the importance of perseverance and the need to focus on proﬁts and not just the idea of business. The next talk was by KA Srinivasan, cofounder of Amagi Technologies (www.amagi.com) and founder of ImpulseSoft. Mr. Srinivasan shared

his experiences about starting ImpulseSoft, how it got acquired, and what they focused on in his venture, Amagi. He advised aspiring entrepreneurs to focus on doing what interests them. He also emphasized on the need to be flexible and change one’s ideas if needed, to avoid learning the hard way. Karthee Madasamy from Qualcomm Ventures (http://www.qualcomm.com), a VC firm, then spoke about inflection point (the point at which the growth of the product/industry is typically exponential in nature). The session ended with a talk by Manish from Saarthi Consulting (www.saarthiconsulting.com) who spoke about “Success Chakravyuha” or the 7 factors that decide the success of a start-up.

Startup Saturday, Hyderabad The theme of Startup Saturday, Hyderabad was “Cloud Startups.” Different concepts like building solutions in SaaS model, building tools and infrastructure for the cloud, and key challenges in the business models for cloud solutions were being discussed in the event.

The ﬁrst speaker was Satish Madira, founder of Yasu Technologies, and an angel investor in Hyderabad. In his engaging talk on cloudbased business models, Mr. Satish Madira spoke about the online gaming industry free gaming consoles, and subscription-based games. Chiatanya, from Ozonetel, spoke next about the product KooKoo. KooKoo is a next generation inbound and outbound IVR telephony platform that allows users to build and manage their telephony application using a web technology of their choice. The Hyderabad event ended with a talk by Ripul Kumar of Kern Communications who spoke about a new cloud-based LMS solution being launched recently.

Startup Saturday, Kolkata Startup Saturday, Kolkata, tried a new format this time. Instead of speeches it had an open discussion session by entrepreneurs, aspiring entrepreneurs, and other professionals on serious issues that affect start-ups and businesses day in and day out. The session started with a discussion on “should a start-up focus on one core competency or should it take up every small assignment that comes its way just to survive?” Aji and Manoj suggested that it is a good idea to take up what comes your way while dedicating a certain percentage of resources in building a product or a particular service. Pallav Nadhani, another attendee, said that the resources of the start-up should be allocated only to its long term, medium term, and shortterm projects. Another debate that sparked at this point was “how to differentiate products and services?” Many emphasized the importance of developing products to succeed. It was pointed out by several attendees that it is difficult to be a 100 per cent product company

as even giving a product may entail providing some services ancillary to the main product, such as installation or user training. The event ended with a discussion about hiring and retaining talent.

Startup Saturday, Chennai The ﬁrst speaker in the Chennai Startup Saturday, Vivek from Interview Street, made a simple yet powerful presentation. Satya Prabhakar of Sulekha.com then shared his experiences by giving a glimpse of the challenges faced by an entrepreneur. “You need to be fully involved in an idea and at the same time enjoy the vagaries of life,” Satya pointed out in his talk.

Startup Saturday, Pune The theme of the Pune Startup Saturday was “Mobile Application Development.” The ﬁrst speaker was Sachin Murgunde of Savvy Infocenter who gave a good overview of the mobile market with a lot of statistics. Sagar from Optinno Technologies spoke next. He spoke about the complexity and difficulty of product development and market analysis. This was followed by an insightful talk by Shardul from Webonise on the world of mobile products. Shailendra from Mobisoft was up next. Later, Surojit Nandy introduced his company IncuCapital (http://www.incucapital. com) that works with start-ups and helps them with their scale up. The event ended with a talk by Jignesh Jain from XTPL on mobile product development. Startup Saturday happens in eight cities every second Saturday of the month. Join us there if you have the faintest inclination towards entrepreneurship and start-ups. We can assure you that these sessions will leave you inspired. The audience comprises of entrepreneurs, aspiring entrepreneurs, academicians, corporations, students, and even curious passersby. Signing off folks; let’s create more start-ups and make the existing ones more productive. Join us @ www.headstart.in or follow us on twitter @ headstarters. Contributed by Ruchika Abbi (audience at SS Mumbai), Ramesh, Ramanuj, Ram, Vaijayanthi, Prakash(audience at SS Chennai), Sarang Lakare (audience at SS Pune), Swati (editor) and HS content team.

DARE.CO.IN | DECEMBER 2010

OPPORTUNITY

CLASSIFIED

A Class Apart Welcome to the era of online classified services. The business of classified advertising has a huge market for it holds a lot of perks for the end-users By Shradha Mohanty the user to make a clear distinction between content and advertisement. “If you start an online classiﬁed only, it is not a proﬁtable business today. You have to focus on business to consumer traffic and not just consumer to consumer traffic. Hence we made changes in our business model to suit market needs,” says Satya Prabhakar, CEO, Sulekha.com

Identifying Customer Needs

he horizontal classiﬁed platform cuts across almost all categories ranging from real estate to cars to jobs to services and everything in between. The Internet today is helping users to buy, sell and post ads a lot more easily than newspapers. When online, the users can compare a variety of products before they buy one, advertise a lot more on their products when they want to sell. Hence, there is a huge business opportunity in starting a classiﬁed platform online when the user demand is so high.

Spotting Opportunity Quickr.com wanted to provide something to the users that is faster, better and cheaper. “See normally you can get two of these things at a time, you can get something faster and better but it won’t be cheap or you can get it better and cheap but it won’t be fast,” says Pranay Chulet, CEO, Quickr. com A classiﬁed ad in a newspaper today is expensive and small businesses cannot really afford to place anything 82 DECEMBER 2010 | DARE.CO.IN

beyond a 5-line ad given their constricted budget. But online, all of this comes for free. “There is nothing cheaper than free,” says Pranay. He also adds that Quickr’s main focus was on providing a clean and simple experience to the users. “The way the classiﬁed market was when we started - there was a lot of noise in the market. There were quite a number of websites but they didn’t have good quality content or didn’t provide a very good user experience. So a lot of people fall into the trap of thinking just because they can put up a website and they are running a classiﬁed business,” Pranay explains. There are a lot of players in the market today who grew fast initially but eventually failed to maintain the momentum in the long run. In a bid to increase the traffic and revenues they ended up cluttering their platform so much so that it is difficult for

What customers want today is to be able to close transactions quickly, hence it becomes very important to provide the requisite technical extensions on the website which will help connect buyers and users better. The success of an online classifieds depends on the quality of content that pops up and the response rates. For example, Quickr provides the user a free complimentary SMS with a copy of any response to the ads that a user posts. That way the users do not have to continually check their emails or log into the website to check for responses.

Common misconceptions when starting up It is a common misconception that an online classiﬁed would run only in the big cities and that you will not be able to garner many users in cities other than metros. “I would say the opportunity lies as much in bigger towns as in smaller towns. The cities are usually the suspects that one goes after ﬁrst because they are more populated and have lot more net savvy people than in towns or villages but I think what

people are underestimating in general and what we have been positively surprised by is the growth of our users in smaller towns,” says Pranay. He goes on to add “Classiﬁeds is a very local kind of a game, so people transact in their city or even in their own locality and with the help of internet penetration, one can surely hope for more users there as well.” You need to market your website properly and most of this actually happens through word of mouth. “One can invest in market in the short run, but in the long run, people have to like your website to tell each other about it. That’s how big companies become big. It is all about enhancing user experience so that they feel compelled to spread the word around. The power of word of mouth is often underestimated,” says Pranay.

game. Anybody can put up a website but this business takes a lot more than that”, he adds.

Challenges It is crucial to maintain a perfect balance between demand and supply. You need to have enough listings and make sure you have enough people coming and reading those listings otherwise people will stop listings after sometime. Also, if you have too many people visiting and not many listings, they will stop coming to your site. “The biggest challenge is maintaining clean experience for users. When you are in this business you grow fast. People start connecting to you quickly but some of them may be spam ads or outdated content. We read every single posting that comes to us and make sure we make it clutter free.” says Pranay. “You have to tweak things

Revenue Streams The common revenue streams would be from advertising and creating premium listings on your website by way of which a user pays you to get product placement in your listings to get even more responses. Quickr has also started another way of increasing revenue by generating business feeds for small businesses. “We at Sulekha integrated our local search, yellow pages and classiﬁed and that is where our revenue now comes from today,” explains Satya.

Pre-requisites “You need to pay attention to the basic technology and have a team that understands not just technology but marketing, SEO and quality of content. They should also have offline capabilities in terms of going out on the ﬁeld and talking to small businesses,” says Pranay. “It is difficult to scale these businesses, as they are pan-India large-scale businesses and to create a market place you need to maintain a perfect balance between demand and supply. This takes time to play out, so you need the patience and the resources to actually stay in the

FACTFILE Company Name: Quickr.com CEO: Pranay Chulet Started in: 2008 Headquarters: Mumbai Reach: Across 40 cities in India No. of visitors/month: 8 million No. of employees: Less than 100 Turnover: Private Opportunity Spotting: -Providing quality content and ensuring quick response rates - Ensuring a user friendly platform which clearly demarcates ads from content Company Name: Sulekha Classifieds CEO: Satya Prabhakar Started in: 2006 Headquarters: Chennai Reach: Across 34 cities in India and more than 10 states in US and Canada No. of visitors/month: 15 million No. of employees: 412 Turnover: Private Opportunity Spotting: Converting local search, yellow pages as well as classifieds into one platform to ensure free traffic

“I would say the opportunity lies as much in bigger towns as in smaller towns” Pranay Chulet CEO, Quickr

even after your platform is established, there are constant changes and constant learning you get from your users and you continue to implement them and that’s where your real investment works because that’s where you get people to like your platform so that they can tell each other about it. This is one thing that often gets overlooked”, Pranay explains. Also, the websites make the mistake of investing in the wrong places. “Unless you have a lot of free traffic that comes, you have to spend a lot of money in purchasing traffic. Eighty per cent of the investment of companies goes in purchasing traffic. One should avoid that and use the income of the business for other aspects,” says Satya.

Opportunities in the future With the advent of internet services on mobile phones, it has opened a lot of ground for online classifieds to expand their platforms. “It is clear that cellphones are a big medium. We have already launched a mobile site and getting users to get acquainted with it. If we crack the mobile medium, we hope our users would double and triple in the coming years”, explains Pranay. DARE.CO.IN | DECEMBER 2010

OPPORTUNITY

CAMPUS

Entrepreneurial gurus at work More and more students are daring to take the entrepreneurship path right in the middle of their academic lives. Their decision is now impacting the way their teachers look at their own jobs

‘T

he times they are a changin’, crooned singer Bob Dylan years ago. That line ﬁts right into today’s classroom dynamics. With entrepreneurship steadily becoming cooler than salary packages on campuses, and more and more students daring to take the entrepreneurship path right in the middle of their academic lives, the

Ganga S, NEN-trained faculty leader

84 DECEMBER 2010 | DARE.CO.IN

relationship between students and faculty is seeing a marked and interesting change. The blackboard seems to be heading to the boardroom, with faculty-student relationship being transformed to that of a mentormentee. Several of the 1100-plus NEN-trained faculty leaders across 512 NEN member institutes are steadily stepping up their commitment from previously helping students to set up and run entrepreneurship clubs to now taking on the role of early-stage mentors, hand-holding students as they launch their own ventures, and helping them cope with the struggles of starting up. Consider TIMSR graduate Sweta Tiwari’s example. Sweta’s entrepreneurial journey was the most unexpected; she would have laughed at the suggestion two years ago. Sweta’s father had taken a loan to ﬁnance her MBA studies, and Sweta planned to take up a

job to repay the debt. However, a BPlan competition held by her institute’s NEN E-cell changed her life. At that competition, she met Ganga S, a NEN-trained faculty leader who had attended NEN’s faculty development programs and Goldman Sachs 10,000 Women Program on “Tools to Grow Your Business,” (organized in association with the National Entrepreneurship Network), which trains faculty members to mentor women entrepreneurs. Ganga inspired and supported Sweta to pursue the business idea she presented at the contest – of manufacturing chocolates. Ganga became her mentor, hand-holding her through all the bumps and turns that came her way while starting her venture. From assisting her in developing her model, to strategizing over pricing and packaging, and helping her deal with peer pressure of taking up a job – Ganga helped Sweta develop as an entrepreneur all the way. Today, Sweta’s business is steadily growing – she gets an average of 20 orders that brings her over Rs 30,000 in proﬁts a month. She skipped her institute’s placement day. Instead, she has hired ﬁve people to run operations and is now raising funds for a manufacturing unit that will produce chocolates on a large scale. In October, during the festive season,

Rajashree Jain, Professor at SICSR

Sweta bagged her largest order yet: 175 kg amounting to Rs 1,00,000. Similarly, Rajashree Jain, professor at SICSR, helped Rachit convert his passion for the outdoors into an adventure tourism start-up called Adventure Pulse. “I am an extremely passionate trekker, always ready to escape to mountaineering camps. But then people would always tell me – you can’t be looking at this as a career, can you?” Rachit recalls. Rachit joined SICSR “to do what most street-smart kids do these days – opt for undergraduate studies that will help you get through MBA someday.” Surprisingly, it was at SICSR that he attended an entrepreneurship program, run by Rajashree, which got him thinking about following his heart and launching an enterprise. Rajashree became a mentor for him - answering his questions, sharing contacts, and helping him build his business model. “I helped him reﬁne his initial thinking by helping him with ﬁguring out the opportunity and answering other critical questions,” says Rajashree. Early-stage mentors like Ganga and Rajashree act as a sounding board for student entrepreneurs,

helping to clarify their thinking through discussion and questioning. They help frame the business model, diagnose what other help and input the entrepreneur needs, and then reach into their network, or into the NEN resources, to tap the right people at the right time. Resources could include other entrepreneurs, industry or technical experts, financial or legal professionals, and investors. “Overall, I think we stop new entrepreneurs from burning their fingers,” feels Haseena Sayed, NEN faculty leader at Mumbai’s Jai Hind College, who is mentoring two student start-ups in the education and entertainment space, respectively. According to Sunita Singh, cofounder and senior director, NEN, faculty members with the right training and motivation are uniquely positioned to become highly effective first-level mentors for entrepreneurs because: faculty members are accessible to their student, alumni, and community entrepreneurs; these young student entrepreneurs tend to trust that faculty members will not steal their ideas and feel more comfortable opening up to them; and the faculty selected iden-

tify working with entrepreneurs as a professional goal, with the approval of their institute management, and therefore can devote consistent time to the endeavor. However, a limitation with engaging faculty as mentors is that many faculty members have little entrepreneurial and industry experience. This limits their helpfulness to entrepreneurs if they were to rely solely on their expertise. Perhaps, this is the reason why NEN faculty leaders like Indraneel Mukhopadhyay of Institute of Engineering and Management, Kolkata, call themselves a “facilitator.” Indraneel, who is working with student entrepreneur Sudipto on his web company, facilitates Sudipto’s connection with industry experts and encourages him to participate in skill-building workshops. In addition, NEN has launched a plethora of faculty development programs (FDP) that help to develop the most mature and experienced of its faculty as mentors and facilitators, focusing on subjects like business plans and business models, IP strategies for building competitive advantage, commercializing prototypes, and fundraising for entrepreneurial ventures. Additionally, selected faculty go through advanced internship with investors and seasoned mentors to hone their skills. NEN has partnered with Department of Science and Technology, Government of India, and Goldman Sachs for some of its programs. “Today, thanks to the courses and my exposure to entrepreneurial thinking, I understand entrepreneurship much better. I look at solving a problem in multiple ways. Irrespective of what start-up ideas my students are working on, I try to bring a similar thinking into it. This approach has helped me become an effective ﬁrst-level mentor,” ends Haseena. More articles on www. nenonline.org. Content provided by NEN DARE.CO.IN | DECEMBER 2010

UNWINDINGS

SGNIDNIWNU

On The Bookshelf

By Shradha Mohanty

Reality Check: The Irrelevant Guide to Outsmarting, Outmanaging, and Outmarketing your Competition Guy Kawasaki Former Apple evangelist Guy Kawasaki’s book is packed with smart advice which every entrepreneur can use in his business. The 450 page self-help guide includes posts from his famous blog ‘How to change the world’ as well. The chapters in the book are short and concise and includes topics like how to make an effective presentation, how to decide upon a business model and how to write an effective business letter. This book is highly recommended as it covers almost all the aspects of running a business.

Publisher: Portfolio Price: Rs.599

Free: The Future of a Radical Price Chris Anderson Free is all about how a business can profit from giving things away rather than charging the customer for its commodities. He explains that you don’t always have to make money with your products, rather you can make money from what goes ‘around’ providing that product to the customer. As radical as it may sound, Chris Anderson explains how businesses today will gradually trend towards this concept by which not only can the customer but also the business can benefit. Most of his arguments seem well justified in case of web based businesses, however, they don’t seem very convincing in case of hard goods and labourintensive services.

Publisher: Hyperion Price: Rs.514

Good to Great Jim Collins ‘Good is the enemy of great’ says Jim Collins in his book. His book features 11 case studies of companies like Fannie Mae, Gillette, Kroger, Wells Fargo etc that made it from being ‘good to great’ over a period of ﬁve years and have now established themselves as ‘Built to Last’ companies. He has also made comparisons with two other sets of companies. In ‘direct comparison’ he showcases companies which had the same resources and opportunities as the ‘good to great’ companies but did not succeed. In the ‘unsustainable comparisons’ list he refers to companies that did make a move from being good to great but failed to maintain the performance on a long term. This helps readers make a clear distinction on what to do Publisher: Harper Collins and what not to do when trying to move from being ‘good to great’. Price: Rs.703

86 DECEMBER 2010 | DARE.CO.IN

The Lounge

SME (Success Made Easy) for your SME This is what serial entrepreneur Ajay Wahi’s book ‘and the award for BEST SME of the year goes to...’ is all about. Over the last 25 years of his professional career he came to realize that the one common challenge that all SMEs faced was retention of employees and deriving maximum benefit from them. The book focuses on people, productivity, process, positive energy, vibrancy, people’s mindset, attrition, employee development etc. Here is a sneak peek into one of the book’s chapters.

Chapter 9: DON’T ALWAYS HIRE THE BEST Don’t get shocked by this! We have been told that we should try to hire the best. And here I am asking you not to do that! Why am I saying this? Simply because in a SME, it is difficult to retain talent; if you have only the BEST, you are essentially issuing an open invitation to the world to poach on your staff. Why hire the best and lose them to the competition just as they began to contribute meaningfully to the organization? How do we solve this Catch-22? I believe the optimal solution would be to divide your talent requirements into 2 parts: one consists of key functional and critical roles where you need to go all out to hire and retain the BEST. This is because without the best you cannot make the best product, best process, best technology, best delivery etc. Once these key roles are staffed with the best, the rest should actually be somewhat below the best, since they do not fulﬁll critical functions in the company. This differentiation in viewpoint and strategy is worth the attempt, because the ones who are somewhat below the best may take a little longer to do so, but could end up delivering nearly the same quality as the best would have in those positions.

Ajay Wahi

This staffing strategy ensures everyone wins. The few BEST win as you can pay them higher salaries which you could not have if the entire company had been staffed with BESTs. The BESTs feel valued and develop loyalty for the organization. The less-than-best win because they are able to learn from the BESTs. You as CEO win because the lessthan-best are less likely to leave you for another company, and you save monies on salaries you pay across the organization. I applied this strategy with success: in one company where I worked, there was a product development role and another role where these products were customized for each client. For the critical development role, we hired the BEST. However, for customization, rather than taking the best (such as B.Tech. graduates whom we were inducting earlier), we started to recruit MCAs who were happy to deliver the same results with lower pay packages than

the B.Techs would have been willing to work for. This approach paid such rich dividends that we are now planning to stop taking even MCAs, instead hiring B.Sc. graduates and training them to deliver the required results! However, to make this concept a success, first make your processes and business models so automated, and make your training and skill enhancement programs so structured that you can do with less qualified and less experienced people. Appropriate investment in tools, technology, and processes will help you achieve relatively more with relatively less talented people. We have all heard so much about how automation in production and processes help in either replacing people, and/ or getting the same quality of output with less experienced staff. That’s money saved and people retained! If you think about it, the entire Indian IT and ITES industry is all about American and European companies outsourcing work to Indians with lower qualifications and experience vis-a-vis their counterparts in the home country. All they are doing is adhering to the policy of NOT ALWAYS USING THE BEST and they save time and money to distribute among the limited best they do have! Alert:Y ou need to correctly identify and differentiate between critical and less critical roles before you can apply this learning. You will need to automate processes and train the less-than-best so that they can perform adequately. Then only you could manage to not always hire the best. What’s in it for me:The BEST get higher salaries than they would at other organizations because they can take a larger slice of the wage bill. The less-than-best are excited about learning opportunities from training and working with the BEST, and are motivated to stay longer with the organization. To write to the author, please send an email to dare@ cybermedia.co.in with the subject line 'Ajay Wahi'.

DARE.CO.IN | DECEMBER 2010

UNWINDINGS

SGNIDNIWNU

Review hen Amazon took over Zaplinkexchange.com was sold to Microsoft pos.com- an online shoe store for 256 million dollars. After this he and in a billion dollar deal last year, his team began a venture capital organiit came as a surprise to many; everyone sation, Venture Frogs. It is interesting to wanted to know the secret behind the note that around this time, he had also success of the online company. And learnt team and community building. there were high expectations when CEO Lessons learnt here include the combined of Zappos.com Tony Hsieh wrote the spiritual strength in Rave parties (you book, ‘Delivering Happiness-A path to heard it right rave parties and spiritualprofit, passion and purpose’. Many readity). Well, may be the bigger idea seems ers believed the secret behind the sucto be that successful people are able to cess of Zappos.com will be revealed in learn lessons and use them even from the the book. And interestingly enough, Demost bizarre situations. Tony could get livering Happiness does not disappoint together most of his team to stay in the the reader in this respect. same building giving an opportunity to Delivering HappinessTony’s mantras for entrepreneurs are work and think and enjoy together. The A path to profit, passion and purpose woven around his personal story. Being other place which gave him some good a good story teller, Tony keeps the reader business lessons was (another surprise) involved even as the success mantras are discussed in the the Poker table. Hold on! Don’t jump to conclusion that background. He makes it look so easy that there may be business is nothing but chance. Tony found the logic a feeling that such success is not out of reach. However, it behind Poker games and learnt how to win them. Some is also possible that a person may end up reading it like a interesting lessons he learnt from Poker... Table selecstory book and miss out the essence. tion is one of the most important decisions you make. In Delivering Happiness, the successful entrepre- Further, he goes on to say winning most hands does not neur is able to connect the various elements in his life mean making most money in the long run. Some hands which helped him become what he is today. At the ten- ought to be lost. Figure out how to play the game when der age of nine, Tony’s attempt to start an earthworm the stakes aren’t high. And finally, do the opposite of farm did not work. The business failed as at what the rest of the table is doing to differentithat early age it was not a planned venture. ate yourself. Learning from his mistake, he soon was able As of the secret behind Zappos big success, to convert a button making kit into a profithe talks about the emphasis that was always able business venture. Tony could get clients on the work culture. The book gives full credto buy shirt buttons customised with photos it to their call centre and the way they deal as a mail order business. Probably it was easy with customers. Their customer centric apfor him to adopt the online business concept proach and dealing with vendors, buyers and later in his life, thanks to the success of the employees in a friendly transparent manner mail order- photo button business. And in By A Ravi Shankar pushed them to the position the company has college, it was the business of selling pizzas. reached. Some of the very interesting Zappos In short, his entrepreneurial skills were obvious from a Mantras for success include... Pay brand-new employvery early age. Tony writes that throughout his school ees $2000 to quit, an easy test developed for integrity, and college years, he spent time nurturing these skills make customer service the responsibility of the entire yet ensured his studies did not suffer. Tony found smart company—not just the department, apply research from ways to score marks without spending his entire day just the science of happiness to running a business and help on studies. The book gives couple of practical tricks to employees grow personally and professionally. students to improve their marks. The all rounder learnt In fact, the last chapter of the book is dedicated to revarious languages, piano and more along with his stud- searching happiness. It talks about the fact that our ultiies. This early part of his life is written in an entertain- mate goal in life is to seek happiness. It is not more moning and funny way. ey or finding the right soul mate etc. This final mantra of After talking about his student days the author talks the book Delivering Happiness cannot be side-lined as about how his network of friends, colleagues and part- just another motivational theory as it comes from a very ners was instrumental in his success. Linkexchange. successful young entrepreneur Tony Hsieh. com was his first hugely successful venture. The skill of selling a concept to venture capitalists and the persever- To write to the author, please send an email to dare@cybermedia.co.in with ance required is presented well in the book. Eventually, the subject line 'A Ravi Shankar'.

88 DECEMBER 2010 | DARE.CO.IN

What’s new? A sneak peek into what’s new in the gadget shop this month

Amkette Flashlink Sleek, small and black in colour, Amkette Flashlink has two indicators on its body that show when you have to transfer data from PC to PC. Once Flash Link is connected to one of the devices, the inbuilt software, asks one to run the AFLloader in both the devices that are connected using a USB cable (provided with the device, or one can use any regular mini USB cable for it). And this happens everytime the devices are connected, thus making it easy to use. Price: `10,700/-

The New Apple iPod Nano The new iPod Nano gets rid of the jog wheel and now comes with a bright 1.5” square color touch screen. The device still has an anodized aluminum body and comes in seven different colors. Using the iPod’s new interface takes just a couple of minutes as it is very simple. The output from the iPod is excellent with clear sound and good bass output. It provides 6 hours of non-stop radio playback and 14 hours of MP3 playback.

Price: `990/-

Genius Slimstar 801 Genius SlimStar 801 is an ultra slim keyboard combo and includes a wireless mouse and a tiny pico receiver along with it. The combo boasts of compact build, lightweight and freedom from the hassles of wiring. Typing is less noisy, easy, accurate and the keyboard also responds quickly. The 2.4 GHZ wireless optical mouse is light and compact and gives wireless freedom of up to 10 metres. It works with the Pico receiver and is powered by a

Price: `1290/-

Content generated from DARE.CO.IN | DECEMBER 2010

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