Open Up to Innovation.

Most of us would probably agree that corporate cultures stifle innovation. This has become an expectation in large firms, where the voices of customers and employees may be lost in the filter of layers of management. It's similar to the game telephone, in which the first person in a circle whispers a phrase to the next person, and that person passes it around until the last person in the chain says out loud what they heard. The message the last person hears is rarely similar to what the first person said.

Organizational distortion is subtler and even more misleading because what is filtered out may be anything upsetting to the next level of management. Often this is not a conscious process. We all try to see things in the best possible light.

Data suggesting employees are terrified of a particular manager may come out as, "Some of the employees have some issues with Manager X." Data that customers are unhappy with the latest upgrade may be translated into, "Consumers are pleased with the new features but find the user interface confusing." This is not exaggeration. Both are real examples of losing the message in context and translation.

Yet, innovation comes out of disruption. We all have heard the expression "fat, dumb and happy" applied to companies whose past success has made them complacent, so they stop innovating. Failure to anticipate market changes has brought down many companies originally known for their innovation.

In my career, I have seen a few practices that worked consistently - even in large, global firms - to create an environment in which innovation thrives, despite past success. These include:

A CEO survey, with no filter allowed. At GE, employees received periodic surveys directly from the CEO at their home addresses. The survey asked for the type of information most likely to be filtered out in the normal course of business. For instance, questions included whether the employee was proud of the quality of the company's products or whether a key initiative for the CEO was being effectively communicated and acted on deep within the organization. At Cisco, we launched a similar process in 2002-03 that continues today. With this detailed feedback, the CEO can find problems that have not come to his or her attention and act on them.

We also use "Skip Level" Meetings, at which leaders get together with the first level of nonsupervisory employees to gather feedback and talk about issues they are seeing. This approach opens a direct communications channel and sends a message that the leader really wants to hear the truth, without filters or spin. The approach also has the advantage of exposing leaders directly to talent, which helps them gauge the quality of their subordinate managers' people assessments.

Many companies gather customer data via surveys, but this can become "non data" over time. If you bought a car in the past few years, you have probably been asked to "give me a good rating" on particular questions in the survey sent to you after the purchase. Tying the pay of salespeople to customer feedback is a good idea in principle, but it can interfere with the quality of customer data received.

Direct feedback on salespeople is valuable, but an occasional face-to-face customer meeting by a higher-level leader will yield more textured data. Further, having more than one point of customer contact is important when a salesperson joins a competitor. Soliciting multiple types of feedback from a variety of sources in the customer's business is important to understand the relevance and quality of products and the customer's thought process when selecting a vendor.

In addition, moving people around within the company will put fresh eyes on business issues, which can improve the quality of data received. This also is a good hedge against salespeople who leave and take your business, as you can establish that the relationship is between the customer and your company, not the assigned salesperson.

Perhaps the most important thing to ensuring your organization hears the truth and allows the disruptions necessary to innovation is to visibly reward the courage to deliver bad news or to challenge accepted business theories and assumptions. The company culture that values truth over conflict avoidance has a big advantage in fostering innovation.

Reference:
Kate DCamp
[About the Author: Kate DCamp is the senior executive adviser at Cisco.]

Value of Innovation.

THE VALUE OF INNOVATION: HOW DO YOU RECOGNIZE & ENCOURAGE IT IN YOUR ORGANIZATION?? 

Innovation has always played a pivotal role in the history of mankind. Be it the discovery of the wheel, making fire, the first towns of the new civilizations or the discovery of the first vaccine and all other breakthroughs in modern science & technology, it can all be attributed to that one factor: the innovative mind!! 

The innovative process begins with the determination of a creative person tomove away from contemporary reality by making something new. Developing creativity begins with asking questions about the present situation: Have I tried my best? Is the current situation ideal? Isn't there a better method? Such probing stimulates one's latent creativity: the more one probes the greater will the results be. 

In corporate management, innovation refers to the creation and introduction of new things, better use of goods and more efficient services and systems. A concerted, planned and organized effort is required if an innovation is to be fully developed and completely implemented. Within industry, the first step towards this objective is to make innovation one of the prime objectives of the company and to allocate resources in that direction. 

Management can promote innovation with more success if they can identify beforehand individuals who can generate creative ideas and think of novel approaches to problem solving. Psychometric tests can play a major role in identifying those individuals with ability for divergent thinking and a knack for coming up with original ideas. These individuals if provided with environments conducive to their inquisitive minds and "will find the answer" attitudes are capable of taking the organization's success to new heights. 

Recognition and remuneration are extremely important in prompting and sustaining innovation. Employees cannot be expected to develop their innovative skills if they believe their efforts will not be appreciated. Any idea that shows promise in furthering the organization's limits should be encouraged by the management however strong the pressures for conformity and continuity may be. After all, history confirms that innovation almost always brings worthwhile benefits to business and industry. 

Glue like Mindsets, die hard Habits and concrete wall like Attitudes are key hindrances to creativity.

How Social Networking Sites are Helpful in Business?

How Social Networking Sites Help?

Web offers a platform to engage professionals and tap key talent for new ventures.

ASOUND adage to know is the one that says it’s not what you know but who you know that counts. Skill and grit can get you far, but it is only networking that will take you far enough. For entrepreneurs, it is the lifeline that fuels their startup aspirations. Until recently, social networking meant daylong seminars which meandered aimlessly or evening tuxedo events, where one waited for the first opportunity to leave gracefully. But it has taken on a whole new meaning in the internet age. Executives at companies of all sizes, but especially in startups, are connecting with professionals around the world through social networking (SN) sites to learn strategy, hire the best people and form alliances.

Keeping up with the competition demands cultivating contacts at warp speed, and that means working your shtick online. There are plenty of tools — many of them free — and more are on the way. Social networking sites are all the rage these days. Younger people may use such sites for dating and hobbies, but there are other sites devoted to professional collaboration.

LinkedIn and ZeroDegrees are two of the more popular services that facilitate business-oriented connections, and some argue that these and similar sites are now doing a better job at connecting entrepreneurs than any other medium before. Remember Metcalfe’s Law — coined by the inventor of Ethernet — which states that the power of a network grows in proportion to the square of the number of its nodes? That’s a geeky way of saying that networking technologies nobody uses are of little value. As the popularity of social networking sites grows, so does their value, because a larger number of users means better odds for productive connections. A look at the sheer number of start-ups getting online shows how their popularity is increasing among entrepreneurs. LinkedIn, for instance, had 40,000 users in mid-November 2003, and is now up to over 5,50,000 users, who have uploaded more than 25 million contacts from their address books. Many of those 25 million will soon be getting e-mails asking them to join LinkedIn and participate in the network.

And LinkedIn is not the only social network out there, of course. It is not even the biggest one, although it is the largest business-oriented network. Others, like Friendster, are oriented more toward easing the way for personal relationships and more popular ones like Orkut and Facebook have recently started professionals getting online to connect with peers.

And new ones seem to pop up every day. And then there is Techtribe, which brings together technology entrepreneurs through social networking. “Connections are of prime importance to any entrepreneur. And there can be no means cheaper to get to know people than creating a profile on an Orkut or LinkedIn,” says Rohit Agarwal, who operates TechTribe.

So how does all this affect entrepreneurial firms? Says Avinash Agarwal, founder of RouteGuru, “SN services offer a cheap platform for entrepreneurs to connect with experts who can offer mentorship and help shape business ideas. It can also prove to be a starting point for such connected entrepreneurs to get in touch with a few venture capitalists as well when they raise money.”

Mr Agarwal himself has used SN to great effect for his startup RouteGuru. Before starting his company, he started a discussion group on TechTribe about his business idea. He placed his idea about an India GIS (geographic information system) service on the internet for feedback from industry gurus. He says: “I blogged about my idea for RouteGuru using the website’s platform. This way, I got to connect with experts. And not just getting feedback, I also got to know a few people interested in my domain and eventually ended up hiring them for my company.”

And now that his company is looking to raise venture capital, he says that he would once again turn to many more sites such as Facebook and Ryze to connect with the right people both in India and abroad.

The world of venture capitalists, however, may still be slow to embrace social networking. Many VCs prefer face-to-face interaction with startups. SN sites, at best, can be a secondary means and not the primary means to connect to them, VCs say.

Also, the biggest concern for many is the amount of spam that an account-holder can face. Suvir Sujan, managing partner of Nexus India Capital says he had to close his account with a popular social networking site after getting an enormous amount of unsolicited messages. Such a tactic could undermine the credibility of a startup, he says. “For instance, while using social networking websites for sales pitches, if one sends out countless unsolicited advertisements to unsuspecting users, chances are that his account might get banned for that network. At the least, you will chase off potential customers and earn a negative reputation for your business.”

In fact, spam generated by social networking has come to be known by its own term: snam. Employees within a startup who are often motivated to join these networks for personal or professional reasons often end up exposing themselves, and their Rolodexes, to the outside world. This may lead to them being head-hunted when they are not actively looking for jobs, pitched products or services they might not want, and waste working hours dealing with contact requests from “a friend of a friend of a friend.” According to a research by comScore, employees tend to spend, on an average, 186 minutes on Facebook per session. “This definitely affects productivity,” says Mr Sujan.

So, what should companies do? Probably, the best policy is the one most commonly used for instant messaging and e-mails: allow certain, secure networks for business use and set policies about how contact data can be shared. Says Mr Agarwal, “I do not think that networking in the cyberspace can be stopped; one can waste a lot of money trying to stop and control it; but I think what they have to do is learn how to deal with it and learn how to live with it.”

Find a COO without spending a bomb

WHEN Bikram Dasgupta of Globsyn Technologies bought out the Mumbai-based Synergy Log-in Systems, he learned a few hard lessons. Dasgupta had acquired the promoter’s stake by making an upfront cash payment. But soon after, Dasgupta discovered that relations between the promoter and his management team had been strained and two key executives left taking their business and contacts with them.

Dasgupta was faced with the task of finding a person who could take on their roles and also the revive the loss-making banking products software company. Because of the differences between the promoter and the senior leadership of the firm, business was slipping and many client orders were unserviced. These customers were considering moving to a different software provider. The need of the moment was a chief operating officer who would lift the company from the morass.

“I couldn’t pay too much money, and I wanted someone who was willing to take on the risk and who had experience in working in a leadership role in a technology firm. If we could turn Synergy around, the rewards would be good,” says Dasgupta.

There was no money to hire a professional executive search firm. Thinking about it one night when he was online, Dasgupta decided to advertise on LinkedIn, the professional networking site. “It was only $160. So, I thought I have nothing to lose,” he recollects. The response was tremendous. And Dasgupta struck gold. One of respondents, Prakash Seernani, became his COO. “Prakash had excellent references. He had been an entrepreneur and had worked in several senior positions in IT firms,” says Dasgupta. Dasgupta is based in Calcutta; so although he travels frequently to Mumbai, Seernani has a big hand in running the venture.

For Seernani, LinkedIn was another way of networking. “Most senior-level appointments at this level happens through networking or through a professional executive search firm. So, it is not really unusual from that point of view,” says Seernani. The opportunity offered by Dasgupta was one of the many that came his way on the Internet. “Where I started, in Hinditron, we still have an alumni network on Yahoo Groups. It’s great way to network and the personal benefits are tremendous,” he says.

Article Resource:
Author: Ritwik Donde is the Chief Editor in the The Economic Times, Mumbai and the article appeared in one of their successful columns on Entrepreneurship/Start-ups called "Starship Enterprise".

Taking Air Transportation to the next Level.

Software Products to Fuel Air Transportation

V. K. Mathews is the founder and CMD of the IBS Group of companies. Mathews founded the International Business Services Group in 1997, which has grown to being a leading global provider of new-generation IT solutions to the Travel, Transportation and Logistics industries and whose solutions today manage the mission-critical operations of the best airlines, the busiest international airports, top oil & gas companies and most luxurious cruise lines around the world.

VK MATHEWS Founder and CMD, IBS Group

Equipped with a Master’s degree in Aeronautical Engineering from IIT Kanpur, Mathews started his career in 1979, teaching computer science to army officers. In 1981 he joined the IT division of Air India and played a key role in the implementation of their computerised passenger services systems world-wide. Subsequently, Mathews joined The Emirates Group, where he contributed to the growth of the airline in various capacities, over a span of fifteen years from 1983 to 1997. As General Manager-IT of the Emirates Group, Mathews was responsible for formulating and implementing Information Technology strategies for Emirates’ global operations.

In the late 1990s, while many industries had already adopted modern software systems to run their operations, the air transportation sector was still using age-old systems that were slow to respond and too complex to manage. There was a need for simpler technology solutions to ease and speed up processes.

On the other hand, India’s brimming software industry was dominated by code-on-hire services companies and the opportunity for leveraging the cheap but effective software skills in the country to meet the worldwide need for software products to fuel air transportation was left largely untapped.

Watching this emerging business idea in 1997 was 41-year-old VK Mathews, figured that a logistics software product model was good enough to make him quit that job and take the entrepreneurial plunge. Thus was born International Business Services. The company, in its first decade, has put together a bouquet of 15 software products to serve the global travel, transport and logistics industry.

The aim of the company was to provide IT solutions to the global Travel, Transportation and Logistics (TTL) industry. Starting with the development of solutions to specific problems as turnkey projects, under Mathew’s stewardship the company has moved from strength to strength. With strategic acquisitions and the technological expertise and business domain competence gained, IBS today offers a range of innovative and cost-effective products, in the areas of airline operations , airport management, airline cargo , oil and gas logistics travel, cruise and hospitality management as well as ocean transportation. IBS is committed to developing new generation IT solutions that replace legacy systems.

In just ten years IBS has grown from an initial size of 60 staffers to a 2000-strong, SEI CMMi Level-5, PCMM Level 5, ISO 9001:2001 and TickIT certified company with a global presence. The company’s earnings have grown at a steady annual compounded growth rate of 40%. The global clientele of IBS includes major corporations like Nippon Cargo Airlines, BAA, Emirates Airline, Cathay Pacific, South African Airways, Air New Zealand, Dubai Airport, SITA, Shell, GulfShare, Qatar Airways, Celebrity Cruises, Star Cruises, Orbitz Worldwide and so on. IBS and its Group companies operate out of Atlanta, Alexandria (VA), Bangalore, Boston, Cochin, Dubai, Hong Kong, London, Melbourne, Phoenix, Rotterdam, Sydney, Trivandrum, Tokyo and Toronto.

Mathews is an advisor to the Government of Kerala in the areas of Information Technology, Industry, Management and Education. He is a member of the State’s IT Advisory Board, Higher Education Council, Planning Board of Kerala (Committee for Industry & IT) and figures in the Board of Studies of several colleges/universities. Mathews is also a member of Board of Directors of the Indian Institute of Information Technology and Management - Kerala (IIITM-K) and a member of the TiE Kerala Core Group.

A committed technocrat and a business visionary, Mathews is one of the pioneers who have ensured a place for Kerala state on the global IT map. In recognition of his achievements he has received numerous honours and awards. He was awarded the Management Leadership Award 2001 by the Trivandrum Management Association, and the Millennium Leaders Award 2002 by Surya TV, a leading television channel in South India. In 2002, he also received the IT Kerala Award for Enterprise Excellence and the Kerala State Sahridaya Vedi conferred on him the award of IT Man of the Year 2003.

The Google Story......Master Entrepreneurs

Google Story!!!

Starting my Blog on Entrepreneurs, I could’nt think of a better way of thanking Larry Page and Sergey Brin for their wonderful creation of all times which we all proudly call as Google.

I read Google Story four months back and was impressed by the inside story and how Larry and Sergey (Co-founders of Google) started their own company which has today become indispensable for all of us. With its colourful, childlike logo set against a pure white background, Google’s magical ability to produce speedy, relevant responses to queries hundreds of millions of times daily has changed the way people find information and stay abreast of the news. Million of people use it daily and have come to regard Google and internet as one.

Google has never spent a penny on advertisement yet it is able to capture and impact our mind and soul. A day without Google is a day without sunshine. To me its like a jenie, who is there to fulfill whatever I write in that white magical box at GOOGLE.com. It has answers to my dumbest questions and as a True friend, I can trust and rely on it anytime.

Google Story by David A Vise reveals the hidden secrets behind what went in the creation of Google and what challenges were faced by its founders right from its inception.

Google runs the largest computer system in the world, which is the reason behind all quality searches and providing a competitive strength to the company. To me Google is an advertising company, which generates money through highly targeted text ads that searchers click when looking for information.

On Aug 19 2004, Google went Public with an initial public offering at $85 per share. In less than a year, the stock soared to more than $ 300 per share. Blue Chip Venture capitalist firms, Yahoo, Alta Vista and many other tech companies turned down the chance to buy Google Search System for a $1 million which forced Stanford Ph D students Sergey Brin and Larry Page to drop out from college and start their own company. By the end of summer 2005, each of the founders had a net worth of more than $10 billion.

John Hennessy, a top computer scientist and now a Google board member, came to know about Google’ page ranking technique which gave good ranking search results in a flash in comparison to Alta Vista the famous search engine that time. He encouraged both of them to start their own company and work in this direction.

The soul of Google m/c is rapid innovation, where all technologists think of solving problems first rather than devising ways of making money and creating products. Google fosters on word of mouth publicity and is not involved in any marketing or advertising activities.

A living example of its simplicity is its million dollar homepage, which is free from any advertisements, just to provide a unique searching experience to its users, which in turn, become its best advocates.

Eric Schmidt, CEO of the company looks after business affairs where as Brin and Page operate in a hands on manner pushing hard on introducing new features and offerings.

Google has the best brains working for it with a state of the art work environment. All employees are encouraged to involve in exploring ideas which interest them most apart from regular work.

Today “to Google” means “to search” which has become a verb in English, German and other languages. In just 9 years, Google has become one of the most profitable company of all times sharing platform with giants like Microsoft, Yahoo. The company as well as its founders are young with many more milestones to achieve in future.

Google got its name from a mathematical term spelled as goo-gol which means a number 1 followed by 100 zeroes. Google earns through searches that happen through advertising. In the long run, a combination of scientific, mathematical and computer skills will be the key to success in future.

When Business Thinking is married to Technical Ideas.

Business Thinking is married to Technical Ideas.

The Indian IT industry is currently witnessing a silent, but very compelling transformation, wherein technology is being viewed as a means to attain business ends, and not an end in itself.

If as developer a product to is he needs being is to developed be clear it in , whom the his mind for why developing , and how it would help the end customer. More than anything else, the focus needs to be on the usability of technology. This calls for a change in terms of the quality of IT manpower. The industry now requires quality brains that can make possible quality deliverance of high-end technical assignments on time and in line with customer requirements. So the pie is gigantic, but grabbing it would remain a dream until the manpower arms itself with adequate skills.

OPERATIONAL DEPTH BECOMES CRITICAL

Indian IT is now being associated with the entire business process, right from developing to the final delivery of a product. For instance, SAP Labs considers Bangalore one of its most important development hubs, since around 10 percent of its patents come from India. Believes Shailesh Shah, Director & Senior VP, Corporate Strategy Group, Satyam Computer Services, “There is greater focus on IT consulting, project management, engineering design and product development leading to substantial revenue streams.”

NOSE FOR BUSINESS IN TECHNOLOGY

So more than just cost effectiveness or technological knowledge, the traits that will set the Indian talent pool apart from other contenders is the ability to understand how the technology they are working on enables business and to think from an entrepreneurial point of view. This means that one needs to be a business technologist to rise in this industry. As Arvind Mishra, Executive VP & Global Head, Talent & Change, Polaris Software Lab Ltd., says, "As the IT industry matures and tries to provide high margin, complex solutions, there is a shift from being purely technical to becoming techno-functional. The software professional today is required to gather domain knowledge. Unlike in the past, when one was called a Java or ‘C’ specialist, the focus today is on whether a person is into banking or healthcare or manufacturing.”

Innovation would be required both in IT services and product development and R&D. Indian IT is already a known name in the ITES space. And in the product development and the R&D space, India has become a hub where the top 10 product companies in the world have set up development centres.

Srinivas Raghavan, VP-MD, Bally Technologies feels quality is becoming the core of Indian services, specially in the area of solution implementation. He says, “The Indian engineer is very good and getting better at implementing solutions on-site wherever the location might be in the world. In future, the number of Indians working at customer locations around the world and implementing solutions for them will only increase.” He feels, nevertheless, that the country should continue to retain its cost advantages.

EXISTING BOTTLENECKS

According to industry estimates, out of a requirement of 2.3 million people, India will fall short by 50,000 relevant IT professionals by 2010. What is to be noted here, is that the fall is not in terms of numbers but in terms of relevance. Only 25 percent of the total technical graduates and 10-15 percent of general graduates are industry-relevant. Added to this, there is no proper grooming of talents at the school/university level.

So what is the way out? Many feel grooming should start at the primary level since logical thinking starts at the primary school level. The need is to address primary education and not build a poor-quality manpower base at the primary level. The industry feels that Indian engineering students, even after four years of studies, are not readily deployable. What’s needed is a close collaboration between the industry, Government and academia to build up a proficient pool that can sustain the growth.

Article Resource:
The article appeared in The Economic Times, Mumbai in one of their successful columns on Entrepreneurship/Start-ups called "Starship Enterprise".

Making Money with the Click of a Mouse.

MAKING MONEY WITH THE CLICK OF A MOUSE

Ads remain the main model of making money from the Net. But, now the advertiser is demanding more tangible benefits from the site owner

IN THE heady days of the dotcom bubble, when the flow of venture capital burst the plumbing, online businesses started in every street corner with the idea of deriving revenues from advertisements. To say that ads will bring in the money was easier than designing a cash flow model for the raw business. Though the ensuing bust thankfully put an end to such websites, Internet businesses and online advertising have continued to evolve. Today, at least half a dozen portals and websites in India have demonstrated that successful business models can be built around advertisement revenues. And some estimate online promotional spending has grown 100 times in the last seven years. Good time to toe the line? Yes... well, may be.

Industry players say the Internet industry in India as well as the advertisers who patronise it have matured, leaving room for only serious players to succeed. It will be a hard and tortuous path to build a sustainable revenue flow and it takes more than a mere IP address to get advertisements. While there are ventures that offer a unique value to customers and thus justify the ad spend on them, there are many who are in the bandwagon just for the heck of it and run the risk of failure.

From bloggers leveraging Google AdSense to techies running YouTube clones to entrepreneurs innovating ever newer online business models, a lot of people are starting web ventures depending on advertisement spending as their principal revenue source. Take Bloozler, for instance. It is a tool that puts blog posts into an e-paper form, story placements prioritised on the basis of user ratings. Or, consider Vakow, a web and mobile-based service dedicated to forwarded text messages. Bloggers and SMS forwarding users are not likely to be vigorously interested in paying subscription fees and these unique ideas must depend on online advertising to have a chance at becoming big businesses.

Yet, go online and you would find several me-too websites that are also tapping the ad world. There are at least 20 ‘Indian’ YouTubes — dekhona, meravideo, videochutney, videocurry, merovideo, punjabitube and so on. Most seem to be driven by dreams high valuations like the $1.6 billion Google dished out for the video sharing service it bought.

In India as in many places else, advertising is the most popular revenue model for Internet businesses. Subscriptions and commissions on transactions are difficult to enforce or represent a much smaller potential market. The new rules of the game require the website owner to present a tangible benefit to the advertiser and be accountable for results. Industry experts list a few of the rules as most crucial:

DEFINE AUDIENCE

Too many online businesses try to capture as many visitors as possible and end up diluting the appeal. A successful website clearly defines its audience and is able to sub-divide its visitors into packages for advertisers. These subgroups are redirected to pages that suit both sides. “The entrepreneur needs to know clearly who his audience is, what is it that he is providing and how is he going to source it… Service the audience right and everything else is a byproduct,” says Dinesh Wadhawan, MD and CEO of Times Internet.

Sometimes, the solutions purportedly offered by online businesses is fuzzy and advertisers don't see a point in communicating through them. “People are trying to fix problems that the consumers don’t even know about,” says Suvir Sajan of Nexus India Capital. “They first come out with a solution and then try to educate people about the problem. For instance, we were once presented with the idea of a start-up that came up with a single page to manage their whole lives. My question to them was ‘why would anyone want to use that?’ After all it isn’t so difficult to check your mail on one site and news on another.”

KEEP ADVERTISER IN MIND

Websites often create content that cannot be matched with relevant advertisements within a page and presented to the reader. Often, they do not have content that go along with the advertisements in hand. The online property must be designed not only with the readers in mind, but also factor in the interests of advertisers, experts say. Advertisers can be fastidious. “They want to see that the content, the look and feel of the pages goes with their brand. For instance, the page which suits an Asian Paints ad, will be very different from one that suits Goldman Sachs,” says Pratap Bose, CEO of Ogilvy and Mather. In websites offering a rainbow of content, classification and clear separation of modules will be crucial to attract advertisers.
Sulekha.com, which began during the dotcom years and survived to tell the tale, suggests a modular approach. “For instance, if you clearly categorise the film section, or the book section or the classified section, this would be beneficial for the advertiser,” says its founder Satya Prabhakar. This will be particularly useful for small businesses, because it is cost-effective for them to advertise online than in conventional media. Leverage this advantage.

BE ACCOUNTABLE

At the end of the day, advertisers want their ad spend to convert into business transactions. An online business owner must actively engage to lead this conversion. Gone are the times when advertisers went by the number of visits, or eyeballs as they called it. Now, they insist on measuring the time spent on each page and the number of unique users. “The industry has gotten more systematic. Advertisers now have the ability to track clicks, clickthrough leads, clickthrough conversions and transactions. this has made the industry more accountable,” Mr Prabhakar says.

BUILD TRAFFIC

The raw material for an online business trying to attract advertisers is the traffic. Content business is not about selling content to readers, but selling audiences to advertisers. “Worry about advertising after building the traffic. But the first rule there is to create a solution that solves a lot of people’s problems,” Rajesh Jain, who started Netcore, says.
Traffic won’t come if visitors don’t see value in coming back. Many entrepreneurs have tried to ape models that worked abroad and build copycat sites for Indians. These have now fallen by the way side. Venture capitalists, too, don't touch these clones any more. Advertisers won’t come where even investors fear to tread. One key trick to build good traffic is to let the website be simply organised and easy to navigate. There are many content-rich websites that are a surfer’s nightmare and it shows in their poor advertisement appeal.

INNOVATE

TV show hosting site, Nautanki.TV, has let its platform by used by content creators who, in turn, can make some money too. “People who wish to use our site as a platform for their content, will have to pay us a basic platform fee. Whatever they earn from the advertisers they bring, they can keep,” says Nautanki’s founder Sunil Nair. Look for going beyond the pricing-per-click model and innovate to give better value to advertisers, content creators and visitors.

At an annual spend to just Rs 450 crore, the Indian online advertisement market is still a tiny, nascent segment. But the bitter after-effects of the dotcom bust has forced the industry to grow up quickly. As the economy grows at a scorching pace, the need for web-based solutions and online advertising is headed only skywards. Time was when the bubbly first mover into a web business idea walked away with rich valuations, but the online world has come a long way since. It is now a place only for steady, long-term players with a cool business sense.

Article Resource:
Author: Jacob Cherian is the Chief Editor in the The Economic Times, Mumbai and the article appeared in one of their successful columns on Entrepreneurship/Start-ups called "Starship Enterprise".

Sporting encounter:Today’s player,tomorrow’s star

Sporting encounter:Today’s player,tomorrow’s star

GloboSport’s Anirban Follows His Love And Sets Up A Market Leader

FOR an entrepreneur in waiting, inspiration can come from just about anywhere. For sports lover Anirban Das Blah, it came in the form of the 1996 movie Jerry Maguire, starring Tom Cruise as a struggling sport agent with a struggling sportsman as his lone client. It eventually set him on the path to sports management business. “You will either be an entrepreneur by your mid-20s or after the age of 40,” Mr Das says, recalling those days when he decided to take the plunge at the age of 26.

Mr Das had returned to India from a stint with Ericsson Telecom in Sweden and was looking for the next opportunity, when he had a chance meeting with tennis star Mahesh Bhupathi at a boutique advertisement agency in Bangalore. The two got talking and their ideas converged on the possibility of a talent management firm. Mr Das joined Mr Bhupathi’s new venture, GloboSport, betting that sport and entertainment endorsement will become a major business in a country, where action was hotting up in both fields.

Today, GloboSport has evolved into a diversified company with endorsement management for celebrities, events, new media, sports and academies. It is a leader in most of its chosen businesses.

“I’ve always loved sport, and all sports lovers, who have seen Jerry Maguire, have always envied Tom Cruise’s job,” Mr Das says. He had to grapple with his priorities and the urge to start on his own. “The opportunity rarely comes across and people are afraid to take the plunge, to take that financial hit or a leap of faith. Especially, when you are young and you’ve tasted success.”

Having taken it up, Mr Das and his colleagues didn’t find the going easy. The team had little experience in business, let alone the business of sport. Pundits looked at them and wondered what Mr Bhupathi was up to. “At the end of two years, we hadn’t achieved too much, but we had a better sense of where the market was headed,” Mr Das says.

The first turning point came when cricketer Zaheer Khan signed up GloboSport. The fledgling firm didn’t have a long client list and had not yet got big deals, but Khan put his faith behind it. This was just the auspicious beginning the firm was waiting for. Soon, more and more sports personalities signed up and the business began to expand. One of GloboSport’s early clients was the then lesser-known tennis player, Sania Mirza. She had not yet become a star and it was up to GloboSport to manage the endorsements of a player ranked 140th in the world.

And that proved to be the second turning point. When Sania Mirza started winning tournaments and a country of one billion people started following her and her game, GloboSport’s day of glory arrived. With every notch that she moved up, the endorsement value exploded and there has been no looking back since then.

“Three things came together at end of 2004 and the start of 2005. One of the first calls Mahesh and I took was to move into entertainment and not just be a pure sports play. We, at that point, could not afford the big players, and hence we ended up signing on obscure domestic and junior players,” Mr Das says. The move proved successful and today, the company’s client list has extended to Saif Ali Khan, the third busiest endorsing celebrity in Bollywood.

The five-year old company today has an estimated billing of Rs 200 crore and is in a phase of transition. At the end of the day, celebrity endorsement is not scalable beyond a point and a company needs new avenues. GloboSport is now moving into film production, leveraging on the celebrity relationships it already has. Building original content is one of its game plans for the future. It also has a sports infrastructure business, which it is extending to retail with plans to open fitness and health centres.

Article Resource:
Author: Sonali Krishna is the Chief Editor in the The Economic Times, Mumbai and the article appeared in one of their successful columns on Entrepreneurship/Start-ups called "Starship Enterprise".

Start-ups Seek an Enabling Environment.

START-UPS SEEK AN ENABLING ENVIRONMENT

What does the forthcoming Union Budget mean to an entrepreneur and how do this year’s wishlists look like.

FOR long, union finance ministers have been presenting budgets to stimulate government revenue flow or exports or consumption or revival of sick industries. But increasingly, they face one more priority. It is no longer enough to announce a few concessions, rejig taxes and leave the rest to god and a compliant citizenry. The primary objective of a modern day budget is not just to balance state revenues and expenditure, but to nurture an ecosystem for economic activity. It is natural that entrepreneurs expect the budget to ease conditions for business, so they can go ahead and give expression to their ideas. This year, finance minister P Chidambaram’s budget will be keenly watched for what stimulus it provides to entrepreneurship. The ecosystem for entrepreneurs has always been challenging in India and should ideally have improved with economic growth and increasing interest among the salaried class to start on their own. A lot of bottlenecks have been removed over time, but the basic complaints remain. Difficulties in raising capital, tax burden, inability to tackle currency fluctuations, wage costs, lack of impetus to research and a framework that favours big business.

For instance, selective tax benefits are a contentious issue when the government puts out a positive list of eligible industries, business mentor Pravin Gandhi, who is also the president of The Indus Entrepreneurs (TiE), Mumbai says. “There is a lot left to interpretation, which eventually leads to complexities, discussions and even litigation,” he says. Small businesses are often unable to benefit from such concessions if their business idea strays from the strict definitions of what qualifies. “A negative list makes a lot more sense than a positive list. Sector specific allocations should not be encouraged,” Mr Gandhi suggests. Also, when these tax benefits expire, it might hurt the new, smaller players more than the large, established ones and actually work as an entry barrier.

But industry experts say an entrepreneur, while looking to benefit from budget proposals or trying to protect one’s business from a new clause, should not fashion the business model around concessions. Many small businesses stop growing after a point, either because the entrepreneur becomes too comfortable with the concessions available only to small players or is afraid of the enhanced risks growth will bring. At the end of the day, entrepreneurs must follow what they want to do on their own and not depend on government’s crutches.

One crucial limiting factor is the lack of tax compliance. Some early stage businesses may believe in saving the money that otherwise would go to the income tax department and indulge in a range of practices to conceal revenues. This not only exposes them to penal action by authorities, but also rules out the potential for partnerships and participation in bigger business opportunities, because mature organisations will not do business with tax evaders. The government has been investing heavily in technology to improve tax policing and remaining on fringes is not going to be possible much longer, in any case. There are a few things that the government can do to reward tax-compliant start-ups in various sectors, experts say.

A lot is said about innovation, and finance ministers have set aside varying amounts to foster research in the country. But, the country remains a research-poor economy, where the potential for volume multiplication is often the driving factor for investment. The government, industry and venture capital houses all work separately, pursuing their own logic and there is little to show on the ground.

For instance, in the pharmaceutical sector, entrepreneur-driven ventures are not even recognised by the Department of Science and Technology. “The department should have a scheme to support these start-ups,” says Indian Pharmaceutical Alliance (IPA) secretary general DG Shah. The funding needs of such units are typically small and the government should be able to give them as grants, of course taking precautions to ensure it goes only to serious ventures. “An institute should be set up, which can evaluate the process, vet the applications and make grants accordingly. These steps are essential to be a player in the knowledge economy,” says Mr Shah. But, “when it comes to providing support, the government develops cold feet,” he adds. It is imperative that these startups are given a free hand along with easy access to funds.

India’s drug firms have gone overwhelmingly the way of generic drugs. They are more interested in making cheap copies of drugs whose patents have expired. While mastering reverse engineering, even the largest of them have not come out with an entirely new drug that the likes of Pfizer and Sanofi-Aventis are able to churn out. The government must push-start research in pharma sector to attract ambitious entrepreneurs, say experts. “If this was to happen Indian pharma research will grow manifold in no time,” says Novalead Pharma CEO Supreet Deshpande.

Venture capital funds typically avoid business ideas that have a long gestation period and highly research-oriented ventures are often a casualty to that approach. “Venture capital funds in the pharmaceutical sector are few and far in between,” adds Mr Deshpande. It makes sense for a venture capitalist to invest in an outsourcing firm, which generates cash registers quickly rather, than in a pharmaceutical research company, which will start seeing cash flow after 10 years. “This is the period when we need assistance. Tax sops are popular instruments, but they are not required for discovery research to flourish,” says Mr Deshpande.

For some years now, new-age entrepreneurs may have spoken as if starting up has to do only with internet, mobile technology and the typical online stuff. But, for economic growth to be wellrounded, a spurt in small business activity in the manufacturing sector is crucial. “The key issue here is that a large part of capital goods are coming from other countries. That means huge imports,” says Sarita Nagpal, deputy director general of the Confederation of Indian Industry (CII). The chamber has presented a voluminous, clause-by-clause memorandum of pre-budget recommendations to the finance minister, suggesting ways to ease customs duty and currency burden on the capital goods front. Also, “there is a significant need for a technology opportunity fund, which can play a role in developing the competency of these small units and which can finally augment capacity of the big players in the industry,” says Ms Nagpal.

Industry bodies have also been making the usual noise about extending tax holidays, providing interest rate subsidies and protecting exchange rates, but it is in the improvement of infrastructure and enabling conditions that an entrepreneur must base his or her strategy on. A new business is born to thrive in a competitive landscape, not a cocooned one.

That means, there will invariably be budget measures that a small business owner must accept and learn to adjust to. All is not lost for the export sector if the tax benefits are taken away, say industry veterans. In any case, plain services are increasingly becoming pointless and products are becoming cheaper by the day. And customers are demanding fresh value and innovation. This would call for entirely new products and services designed for the global market. For example, in the pharmaceutical sector, Deshpande’s Novalead is already showing that sound business models can be built around pure research. The company has shunned the undifferentiated generics business and has charted its own course in drug discovery. The same model could work in a variety of other industries.

The budget is at best a boost to business and at worst, just a bend in the corner to circumvent. As General Electric founder Jack Welch once said, “You’re either the best at what you do, or you don’t do it for very long.”

Article Resource:
Author: Ashish Kumar Mishra is the Chief Editor in the The Economic Times, Mumbai and the article appeared in one of their successful columns on Entrepreneurship/Start-ups called "Starship Enterprise".

Unleash the innovator within

Unleash the innovator within

Five key ways to unleash the hidden potential for innovative thinking in your business and achieve high levels of success:

THINK TWO GENERATIONS AHEAD

Envision your company 50 or even 100 years from now, even if you don’t foresee your product or service lasting that long. Such forward-looking reflection creates an umbrella for long-term innovation to occur. Working back from your 50-or 100-year vision plan in 10-year increments, ask and answer the critical “who, what, where, when, why and how” questions about your business. For instance, who will your target demographic be; what will your core products and business focus be; where will your office(s) and facilities be located ; when will key business milestones be achieved, why will your business matter 10, 15 or 50 years from now and how are you going to achieve your business goals.

CONFRONT & PARTNER WITH THE UNCONSCIOUS

Experts suggest that of all the experiences, knowledge and data stored in our minds, we are only “conscious” of and actively use just 10% of it. The other 90% resides in our “unconscious” — it’s this part of our mind we can tap into for valuable insights daily. For the next 21 days, write one paragraph about some aspect of your leadership process that you want to improve. The more you write about a problem, the more you’ll tap your unconscious for innovative ideas about solving it.

AIM TO INCREASE ENERGY, NOT JUST EFFICIENCY

Do a quick energy audit of your employees to understand what energises them and fuels their personal growth. If you understand what energises them, you’ll be able to implement actions that motivate your employees and increase productivity. Ask every employee to identify the three things that energise him or her the most about their jobs. Also ask them to identify the things they’re not currently doing that would energise them. Then match your employees to the energising activities that best fit their talents and skills and needs. Also ask your staff to identify the three things that steal their energy. Help your management team reduce the activities that de-energise the workplace.

ESTABLISH THE FREEDOM TO INNOVATE

Creativity drives change. So tap into your employees’ intuitive side by ritualising “ingenuity time” on the job. Utilising creative techniques can often help people see issues more clearly. Set aside enough money for your team to compete for an industry-related contest. It will keep your top people on their toes. Encourage people to draw a diagram or depiction of their business problem or challenge in the form of a character or situation. Then ask that they sketch the conclusion they envision that would resolve the matter. Seeing their problem put to life often helps people envision the best solution.

START TAKING RESPONSIBILITY

Any problem you’re directly involved and which you wish to solve requires reflection on your role and responsibility related to that problem. While you may not be the primary cause of the problem, reflecting on your role will help you better understand and acknowledge how you may have contributed to it. When you have a problem employee, start the fix by asking yourself: “What changes do I have to make in myself to help this person perform better?” You may not always identify something that needs changing, but the mere matter of asking and spending some time on reflecting will make you a better leader.

Reference:
(Adapted from http://www.entrepreneur.com/ )

Now this is What I call Innovation!!!

Brand Logos

I am not sure how many of you have noticed a hidden symbol in the Federal Express logo:

Yeah, I am talking about the 'arrow' that you can see between the E and the x in this logo. The arrow was introduced to underscore speed and precision, which are part of the positioning of the company.

The SUN Microsystems logo is a wonderful example of symmetry and order. It was a brilliant observation that the letters u and n while arranged adjacent to each other look a lot like the letter S in a perpendicular direction. Spectacular.

The above logo is for an editing studio. I like the way the logo attempts to convey what they do.

The above are two magazines from the Readers Digest stable. Again, the attempt to communicate what it is about quite figuratively through the logo catches my attention.

I liked this logo of a hair stylist for the cheeky humour it brings to the (dressing) table.

This was a logo created for a puzzle game called Cluenatic. This game involves unravelling four clues. The logo has the letters C, L, U and E arranged as a maze. and from a distance, the logo looks like a key.

This logo is too good. For the name Eight, they have used a font in which each letter is a minor adaptation of the number 8.

Eighty-20 is a small consulting company which does sophisticated financial modeling, as well as some solid database work. All their work is highly quantitative and relies on some serious computational power, and the logo is meant to convey it.

People first guess that 20% of the squares are darkened, but that turns out to be false after counting them. The trick is to view the dark squares as 1's and the light squares as 0's. Then the top line reads 1010000 and the bottom line reads 0010100, which represent 80 and 20 in binary. Eighty-20 is a small consulting company which does sophisticated financial modeling, as well as some solid database work. All their work is highly quantitative and relies on some serious computational power, and the logo is meant to convey it.

Kinda like the surreal green screen of The Matrix, they want us to read stuff in binary.

This was a logo designed in-house for some internal event at IBM. I like that they are quite relaxed about the logo, unlike certain other companies who do not like the logo to be tampered with in any way even for internal promotions.

You might think the arrow does nothing here. But it says that amazon.com has everything from a to z and it also represents the smile brought to the customer's face. Wow, that is quite deep.