because we think ...

Google on the future and evolution of Search

2011-11-28T08:25:00.000-08:00

Email is dying and How...

2011-11-18T21:45:00.001-08:00

Interesting graph that tells a story.. Ask anyone in age group 12-20 years...Email is so passe.

Web 2.0 Summit 2011: Mary Meeker, "Internet Trends"

2011-10-19T22:21:00.000-07:00

Where Good Ideas come from?

2011-07-11T05:20:00.000-07:00

Google wants to own your Wallet...

2011-05-27T07:52:00.000-07:00

Or should it be –How Google will end up owning your wallet?

Yesterday’s launch of Google Wallet was a watershed moment for the payments industry. Google announced an app that will turn shoppers’ phones into their wallets. Google Wallet enables consumers to store their credit cards, coupons, loyalty and gift cards securely on their phone, so they can pay, redeem offers, and earn loyalty points - all with a single tap of their phone. It is in a field test now and will be available to all consumers this summer.

But what makes this so unique? - it’s putting the wallet in a single app on your mobile phone.

Google Wallet has been designed for an open commerce ecosystem. Since Google Wallet is a mobile app, it can do more than a regular wallet ever could, like storing thousands of payment cards , loyalty cards, gift cards, receipts, boarding passes, tickets, and Google Offers . Every offer and loyalty point can be redeemed automatically with a single tap via NFC. Google Offer is in direct competition to Groupon, and we are likely to hear about launch sometime next week.

Google Wallet is not a simple replacement of an ordinary wallet; it is an example of the ‘Wallet of the future’. Launched in partnership with MasterCard, First Data, Sprint, and Citi , Google wants to move your wallet into your phone. Here is the product launch Video.

Stephanie Tilenius, vice president of commerce at Google, announced at the launch “We are about to embark on a new era of commerce. We believe that 2011 will be the year of mobile local commerce. Just TAP, PAY and SAVE”. She said “The world of commerce is ripe for a new wave, we are on the verge of major shift in payments and therefore commerce. Google is uniquely positioned to bring about this shift and accelerate.”

To me, Google Wallet is the perfect coming together of Mobile and Local Commerce. It brings together Merchants, Payments Network, Carriers, banks and other pieces of ecosystem to make this possible.

Think of it, there are over 3 billion mobile phones worldwide, and over 40% of the world’s population carries a mobile phone, far more than use a computer or have access to internet. Mobile Phone is fast emerging as a ‘preferred’ transaction medium. Smartphone sales grew 72% in 2010, and 300 million smart phones sold in 2010 globally. There are several other forces accelerating the pace of customer adoption. Read my earlier post on M-Commerce to understand this better.

How Various blocs are coming together?
Study the Google Model carefully, and you will understand the cleverly crafted master-strategy.You will see how the various blocs (refer image) are falling in place in a manner, mutually reinforcing. The Offer and Wallet models allows Google to get extremely valuable customer information, correlated directly to sales in the physical world, and allows to place relevant offers and serendipitous advertisement, when shoppers are in stores, ready to spend money and even more receptive to coupons and other discount offers.

Currently Google is not taking any 'cut' from the payments revenue; However Google would make money by selling coupons and advertising that come along with the experience. This isn't Google's first attempt at electronic payments. Google "Checkout”, online payment service launched in 2006, met with limited success.

Evolution of Payments:

In the past few thousand years, the world of payments has not changed much—from coins, to paper money, to plastic cards. Now we’re on the brink of the next big shift. In the Initial phase of ecommerce, it was about leveraging the html and web technologies to bring consumer online, very similar to how we shop today. In 1994, it started with Amazon and eBay, and even today continues in a similar manner. But, this is about to change now.

With smart phones, mapped Geo-locations, and NFC- the online and the offline world are converging. The Payments industry is moving beyond plastic and is fast embracing the digital currency. Smart phones have fundamentally changed how consumers interact with mobile technology. This new centricity is profoundly changing the customer experience.

This shift and increasing convergence of Banking, technology and information is creating customer value and new business models. This is just an inflexion point, the significance of this shift in Mobile Payments and Digital Money will be more apparent with rapid consumer adoption.

Click to enlarge

Why should customer be interested?

Because Google has created a new kind of incentive for people to use Google Wallet. The new system will be compatible with Google Offers, a Groupon-style deal’s program, credit cards, and store loyalty cards. If you have been following the Local commerce and Deal Commerce (aka Groupon , Living Social etc) space, you will understand the potential and customer interest.
Over time, consumers will be able to save each of these offers directly to their Google Wallet. That means consumers will get the benefit of carrying their offers with them at all times.

"Unique because combining Offers, Loyalty and Payments in an Open Platform"

However, even with strong tailwinds to support the adoption, there are some challenges to be overcome:

What about Non-Android phones? If Google Wallet is really an open platform, it needs to be cross-platform. How does Google plan to integrate in the larger ecosystem?
Dependency on Mastercard PayPass terminals: Google Wallet only connects to MasterCard PayPass terminals. There are more than 135,000 of those in U.S. stores and restaurants, but that's only a small fraction of the total number.
What about Mobile Carriers other than SPRINT? ; especially when other carriers are planning their own Mobile Wallet. AT&T, Verizon Wireless and T-Mobile USA have formed their own consortium to create a wallet- ISIS, that will compete with Google's.
Competition from other Payments and Card Companies: Visa has also launched a similar initiative, read the blog announcement . It plans to launch a digital wallet product in the U.S. and Canada later this year and already offers a mobile payment program at retailers around the world. Visa has agreements in place with Bank of America, Chase, U.S. Bank and Wells Fargo for mobile payments.

Benefits to Retailers:

With the integration of coupons or offers into Google Wallet, Retailers can target customers by offering discounts directly within search ads to check-in offers to offers in Google Places. (Think Ad-sense, FourSquare, GrouponNow, and Facebook Places etc).

The integration of offers into Google Wallet will enable merchants to close the loop by directly connecting their online and mobile advertising with offline purchases. In addition, Google Wallet provides merchants with targeted foot traffic and a way to engage with customer’s in-store; thus enhancing the customer experience. Their sentiment is captured in this video:

So what else happened in Payments space this week?

Earlier this week, Square, the company founded by Twitter creator Jack Dorsey announced its mobile payment plans. On Monday, Dorsey showed Square’s way of replacing wallets and cash registers without using NFC.

Using this Square App, instead of NFC, users order and pay with an iPhone application, where their credit card information is stored. At checkout, they give their name to the cashier, who will need to use an iPad as a register in order to complete the transaction. This just might render the cash register and POS terminal useless. But this calls for a separate post some other time.

Also there are two other stories worth following:
Why Paypal is suing Google Executives? and Who will win at Mobile Payments Google or Square?

Please do leave your comments and share your views. I look forward to reading them.

Internet IMPACTS - Growth, Jobs and Prosperity

2011-05-26T09:54:00.000-07:00

The Internet has transformed the way we live, work, socialize and meet, and the way our countries develop and grow. Two billion people are now connected to the Internet, and this number is growing by 200 million each year. But the magnitude of the economic impact of Internet-related activities is not obvious.

There are many studies on the impact of IT or telecommunications but little analysis on the global impact of the Internet on growth, jobs, and wealth creation. Does the Internet really create wealth or just displace it? How large is the economic impact of the Internet in objective terms? etc.

To this effect McKinsey Global Institute (MGI) has come out with an excellent research report “Internet matters: The Net’s sweeping impact on growth, jobs, and prosperity with an aim to estimate the magnitude of the impact of the Internet on the world economy.

This research focuses on 13 countries that account for more than 70 percent of global GDP and finds that the Internet has delivered substantial economic growth and created jobs on a large scale. It offers the first quantitative assessment of the impact of the Internet on GDP and growth, while also considering the most relevant tools governments and businesses can use to get the most benefit from the digital transformation.

Key Findings:

Internet accounts for 3.4%of GDP in 13 countries.
Internet accounted for 21% of GDP growth in the last 5 years in mature countries
2.6 jobs created for 1 job lost.
75% of Internet impact arises from traditional industries, primarily from increased productivity.
10% increase in productivity for small and medium businesses from Internet usage
Small and medium businesses heavily using Web technologies grow and export 2X as much as others

Report also has many interesting slides. However, I wanted to share one chart in particular:

Countries that create strong Internet ecosystems reap huge economic benefits

Common sense tells us that the Internet is a vital part of a modern, healthy, growing economy. And while previous studies have examined parts of the picture, McKinsey research for the first time shows the full extent of the Internet’s economic power. And that power is massive.

Understanding just how much the Internet contributes to national economies should spur government and business leaders to seek ways to optimize their participation in the global Internet ecosystem. Encouraging usage is an unavoidable first step in leveraging public spending, but leaders must also focus on providing human capital, financial capital, infrastructure, and the appropriate business environment

Internet maturity correlates with wealth creation, and we find that the Internet is, and will remain over coming decades, one of the biggest drivers of global economic growth.

The complete report can be downloaded here.

Google Advisor : Making financial products comparison easy

2011-05-19T05:05:00.000-07:00

Financial decisions are some of the most difficult decisions we face. Be it, finding the right credit card and mortgage or finding the right insurance product for our family. Due to information asymmetries, it becomes increasingly difficult to find the right product or option. While consumers now have instant access to more information than ever before, this has also made it much harder to find exactly what you want.

With this in mind, today, Google has rolled out a fantastic tool for consumers. Google Advisor is a comparison tool which allows users to get information on financial products. It allows you to compare offer options for your credit cards, checking and savings accounts, CDs or mortgage. With Google Advisor, the search company has entered the consumer finance comparison space. Currently the service is only available in United States and it is a matter of time, before we see international launch.

There has been an explosion of comparison sites over the past few years. More and more consumers in search of everything from insurance to cheaper car loans now visit sites such as MoneySuperMarket, BankBazaar, MyInsuranceClub, Ecompare, Apnaloan, Policybazaar etc.

Although, Google has been testing the mortgage comparison tool since 2009, but has included other products only recently. With Google Advisor, when you enter information about a mortgage, credit card, CD or checking and savings account, you are shown a list of the offers that match your criteria, along with rates and contact information. The benefits are obvious: relevant information in easy accessible format, offers are ranked based on criteria that you choose for your results, and personal information not shared upfront with third party.

Currently Google is not paid for referrals, other than mortgages; however, it is to be seen how the economics of this service will work out i.e. referral fee or advertisement revenue. The most common way for comparison sites to make money is to receive a commission when they help guide a customer to another website. Some providers also pay more so that customers can go directly from the comparison site into their application process. Please do check the additional FAQ’s here .

The financial services ecosystem is undergoing a fundamental change. With the launch of various ‘Internet information tools’, prevalence of P2P platforms, consumer adoption of Mobile payments and alternate payment mechanisms, It is time for business managers to ‘RE-THINK’ their conventional business strategy.

Re-inventing Management for the 21st Century.

2011-05-15T07:18:00.000-07:00

Management 1.0 was invented by people long dead or long retired, but with rapid change happening at an exponential pace, the organisations are facing a fundamentally 'different and new reality'. They face a world, where knowledge is fast becoming a commodity, and it is extremely difficult to have a sustainable differentiator.

The 'command and control' model of industrial age is being challenged. A new management model-more open, collaborative, flexible and adaptable to human beings is called for. The 'Pyramid' structure of management is already giving way to 'amorphous' structure in this 'new knowledge world'.

Here in this short 15 minutes video, Prof Gary Hamel, celebrated management thinker and one of my favorite 'gurus', makes a highly energetic, strong and passionate case for 'tearing down the old management structures and re-inventing the management practices relevant for the new-new world'.

The current system of Management, invented a century ago to maximize standardization, specialization, hierarchy and control etc, is struggling to find its relevance. Gary talks about the invention of Management 1.0? In his words :

While that earlier model delivered an immense contribution to global prosperity, the values driving our most powerful institutions are fundamentally at odds with those of this age—zero-sum thinking, profit-obsession, power, conformance, control, hierarchy, and obedience don’t stand a chance against community, interdependence, freedom, flexibility, transparency, meritocracy, and self-determination

Prof Hamel also talks about HCL CEO Vineet Nayar, and his hugely successful 'Employee first and Customer Second' philosophy. I had shared some of these thoughts in my earlier posts on Open Innovation and Future of Management.

Time to Re-THINK!!

(This video is an excerpt from the University of Phoenix Distinguished Guest Video Lecture Series)

The changing face of banking- Growth of Social and P2P lending Platforms

2011-04-20T09:58:00.000-07:00

Have you ever visited Zopa, Prosper, and Lending Club? For the uninitiated, these are some of the front-runners in the ‘rapidly’ evolving world of P2P (aka Social) Lending.

Peer to Peer lending goes by many names. It is also called social lending; person-to-person lending or p2plending.It can be defined in this simple way: individuals lending money to other individuals without a banking intermediary.

P2p lending sites hope to disintermediate banks and get credit flowing to individuals and small businesses.

EBay + Facebook = Social Banking

These sites can be considered a combination of eBay and Facebook.com- a place where consumers come together to loan and borrow money from each other. The success of these web based P2P lending communities can be gauged by the strong growth in their numbers and loan volume.

First some numbers:

· Zopa, which started in UK in March 2005, has originated 150 million GBP by Mar 2011.

· Funding Circle, a business-focused P2P lending site, launched in August 2010, originated over £1m in loans in its first ten weeks, and is regularly originating $3m per month.

· In the US, Prosper.com has originated $200m till date, and Lending Club is now originating more than $15m loans per month and was named as one of the top private companies to watch in the 2010.

· Leading venture capitalists have invested hundreds of millions in various P2P lending models.

o Prosper , $57 million from Accel Partners, Omidyar Network, Benchmark Capital etc

o Lending Club attracted $52m funding from Canaan Partners, Foundation Capital, Northwest Venture Partners

o Zopa received $34 million VC funding from Bessemer Venture Partners, Benchmark Capital and Wellington Partners and has expanded to Italy and Japan.

Click to enlarge

The P2P lending Platform –Value Net

The lending platform or the Exchange has several roles:

First, the exchange creates the meeting place for a sufficient number of investors and investees to gather.

Second, the exchange establishes the legitimacy and investment rating of borrowers in a consistent and transparent manner.

Third, the exchange manages the process of splitting and distributing each investor’s funds in a cost effective and efficient manner. The exchange also provides other services such as insurance to investors or collection services.

Why is Peer to Peer Lending Becoming Popular?

Peer to peer lending is a rapidly growing industry. In2010, the U.S. market processed over $150 million in loans through the two leading Peer to Peer lenders- Lending Club and Prosper. In the first quarter of 2011, year over year numbers were up close to100%.Clearly, they are becoming more and more popular with every passing day.

Wall Street Journal Names Prosper.com to 2011 "The Next Big Thing" List, One of Top 50 Venture-Backed Companies

Courtesy :http://www.sociallending.net/

If you closely study the innovation in banking, the basic products have not changed much since the Italians were the dominant merchants and financiers in the 15^thcentury.

While the popularity and the ubiquity of the Internet are certainly major factors driving the peer-to-peer lending market forward, there are also very clearly major macro and micro economic factors propelling this business forward. Due to tightened credit standards by Financial Institutions, it is becoming difficult for many consumers to acquire non-collateralized personal loans, thus making them considerably more expensive.

This has thus created an opportunity for individual lenders to step in and fill the small loan lending gap, fuelling the current hyper-growth we are currently experiencing in the peer-to-peer lending market.

Peer-to-peer lending also offers significant benefits to both borrowers and lenders. Borrower get funds at lower rates, those typically range from 10% to 16%, which compare very favorably to credit card advances, which are often over 25% annually or short-term consumer loans, which are often made at over 100% interest per year. Lenders benefit from higher returns on their idle cash deposits,which can range from 2% -3.5%.

Of course , actual default rates remain to be seen, but the combination of a relatively stable (i.e., market neutral) asset that pays high yields relative to both dividends and bonds is going to be appealing to a number of individuals.

What we are seeing is the emergence of a new individual to individual asset class.

The Opportunity: Although this chart has numbers from 2004 (sorry could not get the numbers for 2010 and Non-US markets), the opportunity is staring right in our face.

Click to enlarge

P2P Lending current state: P2Pbanking.com has done a phenomenally good work in compiling together the current state of selected P2P Lending companies.

Click to enlarge

So what next?

While a mass market P2P breakthrough has not yet been achieved, the Facebook, Amazon or Apple of social lending may be just around the corner. Lending Club and Zopa have successfully navigated the challenges of customer acquisition and regulatory compliance.

Most P2P companies are in the early formative stages, and several have failed (while several are expanding rapidly). To develop sustainable success, P2P industry requires execution in the following areas:

1. Regard for and compliance with applicable regulation. Currently P2P Lending companies are not subject to reserve requirements. However they are subject to working capital minimum requirements. Prosper.com got the SEC license for consumer credit after it was stopped from issuing fresh securities.

2. Credit worthy customer acquisition and marketing

3. Borrower/lender symmetry (the balance between borrowers’ and lenders’ needs)

4. Risk assessment and Mitigants. Although some baked in the model, they need to be strengthened-Credit rating, Diversification, Peer Pressure, Default Cover, Payment Protection cover etc)

5. Collections support in case of default.

6. Scalable business models for large scale institutional lenders to participate. Institutional investors have already started showing a lot of interest in this new ‘asset’ class. Please read this interesting story in the American Banker

Lessons for Banks:

Social networking Web sites will affect banks more than we think. Social banking, an emerging banking distribution model, has the potential to displace banks from the center of customers' financial services relationships. The growth of social networking and the emergence of social-banking models will drive fundamental change in the ways that consumers manage their financial lives.

Therefore Banks must create a social media strategy before deciding to evolve toward a social banking model. They should evaluate opportunities to create partnerships with social banking providers – rather than building their own social networks -for example, SmartyPig and Wesabe etc.

The best approach to getting over the fear of the unknown is for organizations to become familiar with the risks and then develop a strategy that fits the organization's risk appetite. Doing nothing and ignoring the influence of social media is no longer an option and may be considered a form of negligence.

According to Gartner “Non-bank competitors are pushing aggressively into banking and investment services, threatening to undermine banks in the financial relationship. The threat is particularly pronounced in two businesses that are at the very heart of banking, namely lending and payment.” Venture capital investment in financial social networks (FSNs) such as Zopa, Prosper and Lending Club, point to the growing prevalence of FSNs and increasing consumer interest in this area.

In summary:

P2P marketplaces have the potential to change the way people borrow and lend money. They provide a democratic, off-the-grid alternative to the consumer credit matrix. However, these firms are still in their early stages, but they're promising.

At present, these websites work for relatively small, unsecured, and primarily personal loans. With maturity we are likely to see portfolio diversification e.g., mortgages for homeowners to finance purchases or refinances. Such sites could ultimately supplant the existing financial institutions.

As a response, the incumbent financial institutions should look at either starting their own lending marketplaces or should partner with the niche P2P lending marketplaces.

Well this is just getting started……I bet there will be a lot of action in this space.

What happens, if Facebook becomes a bank? I will write about this and the future of Social banking in my next post.

So what do you think? Please do leave your comments.

The M-Commerce Revolution Is Here

2011-04-13T12:01:00.000-07:00

Some Statistics and trends:

EBay generated $2billion in global mobile sales in 2010 across 190 countries.
PayPal’s worldwide mobile transactions have skyrocketed from $25million in 2008 to $500 million in 2010.
Smartphone sales grew 72% in 2010; 300 million smart phones sold in 2010 globally.
There are over 3 billion mobile phones worldwide. Over 40% of the world’s population carries a mobile phone, far more than use a computer or have access to internet.
Mobile Phone is fast emerging as a ‘preferred’ transaction medium.
Online Commerce is gaining share vs. Offline Commerce as consumers change their behavior and expectations with rapid development in technology.

The Mobile Commerce Opportunity

Any discussion of the potential opportunity must first start with a basic understanding of what we mean by “Mobile Commerce.” Mobile commerce is comprised of two categories(1) Mobile banking and (2)Mobile payments & Money transfers. Mobile banking refers to situations where the mobile phone is used as an access channel to financial services. Mobile payments and money transfers refers to situations where the mobile phone is used as a payment device to affect the transfer of value from one party to another.

Mobile Commerce has gained increasing acceptance amongst various sections of society in last few years. The reasons for its growth can be traced back to technology and demographic developments that have influenced many aspects of the socio-cultural behavior in today’s world. Mobile services have registered impressive growth in recent years and m-commerce is slowly but surely showing signs of an impressive and healthy growth.

With the advance of the technology and the internet penetration, the traditional way of business transaction has totally shifted from a brick-and-mortar store to a virtual store, and for what it is worth, we can see that the development of the e-commerce and m-commerce is unstoppable.

Online shopping trend with the increasing use of the mobile phone internet has derived and urged the development of the m-commerce, which is the Mobile Phone-Commerce( from its attributes and advantage of unlimited mobility).

Mobile Commerce will grow more rapidly than E-Commerce

The lines between mobile and social are becoming increasingly blurred. Mobile and Social are bringing about the biggest sea change in consumers’ lives; and brands and retailers should take note of the ever-changing landscape. Facebook is already generating significant revenue from social commerce and micropayments for social gaming and virtual goods.

The rate of change and the movement to electronic payments has been accelerated by the explosive growth of payments being made in non face-to face transactions. A key development in the industry was the emergence of the Internet as a channel for commerce. Consumers who previously used the Internet as a novelty and a means for information gathering have gradually adopted this channel for their purchase decisions and transactions

Growth in this channel has been facilitated by advances in technology, trusted infrastructure and applications, and improved customer experience and payment choice (e.g., traditional payment brands as well as new alternatives such as PayPal).

Factors driving growth of Mobile commerce:

Proliferation and Convergence of Mobile devices and Internet: The major growth in Mobile-Commerce will be happen due to explosive growth of Internet accessibility across the globe and revolution in mobile handset market. People are fascinated towards smart phones and social media. The price and technology war in mobile domain has made smart phones much more capable and affordable for people. Similarly, the extensive and intelligent interconnectivity among people through social media & social networking is also helping as an effective marketing channel for commerce. E-commerce is benefiting from several positive trends, including the continued roll-out of broadband, increasing user comfort shopping online.

Proliferations of Mobile devices and Internet

Rising trust in online transactions: M-Commerce to see wider adoption, driven by convenience, lower-price alternatives to traditional retail, and improved trust & safety. (1) Credible eCommerce companies have helped to improve mobile shopping ecosystem and to decrease fraud and bad transactions. (2) Well-known retail brands are starting to sell products online, with many users having good online purchasing experiences.
Well-developed payment alternatives. Shoppers have adopted online banking payment as well as third-party payments (such as PayPal, Square, Zong, Pavyment, Boku, Amazon TextPayMe, Obopay) based on their good experiences.
Growth of ‘Social’. Expect social sites to be an emerging and important traffic generator for eCommerce companies. Synergistic relationship between social networks and commerce merchants will fuel growth for both segments. We are already witnessing a fundamental shift in consumer’s behavior and expectations in a ‘social and connected’ environment.
Emergence of highly personalized, location sensitive, and context aware application and services. Mobile technology allows businesses to become more service oriented in what they do and to tailor what they provide to better meet the needs of individual consumers. Consumers respond positively to businesses that take the time to understand their needs and offer excellent customer service. Real-Time Social Features are Accelerating Mobile Usage.
Large number of internet and Mobile users: According to Mary Meeker, Partner KPCB and Former Technology Analyst with Morgan Stanley- the world is currently in the midst of the fifth major technology cycle of the past half a century. The previous four were the mainframe era of the 1950s and 60s, the mini-computer era of the 1970s and the desktop Internet era of the 80s. The current cycle is the era of the mobile Internet, she says — predicting that within the next five years “more users will connect to the Internet over mobile devices than desktop PCs.”

Meeker says that mobile Internet usage is ramping up substantially faster than desktop Internet usage did, a view she and her team arrived at by comparing the adoption rates of iPhone/iPod touch to that of AOL and Netscape in the early 1990s. According to Meeker, adoption of the Apple devices is taking place more than 11 times faster that of AOL, and several times as fast as that of Netscape. Helping to drive this is 3G technology, which recently hit an “inflection point” by being available to more than 20 percent of the world’s cellular users (although penetration is only 7 percent in Central/South America and 13 percent in Asia/Pacific — excluding Japan, where it’s 96 percent).

“One of the implications of mobile access is a growth in eCommerce, featuring things such as location-based services, time-based offers,mobile coupons, push notifications, etc.”

Convergence of different technologies on single devices that are available anywhere and anytime is allowing existing technologies (such as the internet) to evolve and extend their reach even further. E.g. Near Field Communication (NFC).

Over the past 10 years Mobile phones have changed the way that we live and work.

So what is the nature of this change? On one hand, it’s a change in personal freedom, the mobile phone seems to give us more power as individuals to do what we want and be who we want to be. On the other , more and more smart phones and devices are on the market, retailers are increasingly launching mobile-friendly sites, applications and SMS programs, and consumers are adapting to the idea of shopping on their mobile phones and devices.

Smart retailers such as BestBuy, EBay, and Target have already proved that they can make mobile commerce an experience worth returning to. These companies see mobile as not only a commerce opportunity but an opportunity to learn more about customers and serve them better across the enterprise.

As the world awaits the coming revolution that will result when Near Field Communication technology is preinstalled in every handset and RFID readers are incorporated at every point of sale, retailers should consider launching mobile commerce- enabled sites. Established players such as Amazon.com and eBay’s PayPal have reaped the rewards of getting the mobile payments experience right, and start-up vendors are currently jockeying for position.

Mobile payments players: On the more nimble retail front, Verrus, Square, Zong, Boku and a host of others are creating the mobile payment systems that provide that “pay me anywhere” feature.

(Check - interesting infographic on Mobile Marketing and Tagging)

Reality check : Implication for Banks and Retailers

Mobile Commerce is fast gaining acceptance amongst various sections of the society. Mobile Banking- (availability of bank-related financial services via mobile devices) builds a cornerstone of Mobile Commerce. Mobile Applications are increasingly being employed by many banks around the world to generate additional revenues, reduce costs or to increase customer satisfaction, often with very promising results.

It’s going to be a long time yet before wallets become as redundant and unnecessary as wrist watches, for we are still at the beginning of this change. The challenge for businesses is to embrace the M-Commerce trend early — and do so paying close attention to the consumer experience. This means embarking on a well-thought-out strategy that not only takes into consideration customer buying behavior, but also focuses on creating a cohesive Web-to-mobile experience.

So What do you think? Please write in with your comments and views.

The Future of Education - Khan Academy

2011-04-06T00:24:00.000-07:00

If you want to see the future of education...it is here...The Global One world Classroom...Watch this video by Sal Khan (Bill Gates Favorite teacher) and now imagine the possibilities.

Innovation Blues!!

2011-03-29T22:11:00.000-07:00

Facebook Deals- Shifting business Models

2011-03-16T06:04:00.000-07:00

Facebook Deals , when launched in Nov 10, allowed users, who "check in" at a location using their mobile phone to Facebook Places, to receive rewards and offers via their mobile device.

But now, Facebook is extending this to include offers from local businesses. Soon Local businesses will be able to sign up to use this feature, and people will be able to find Deals.

So how does it work? And how will it be different from daily-deal market leaders Groupon and LivingSocial? Well to begin –All deals offered on the Facebook platform will be around “social experiences,” i.e. “things you can do with your friends”; but how will users pay for these deals? … this is where Facebook Credits become useful!

To know more about How Facebook deals work? Check the following video

Facebook Credits has so far been mainly used for virtual goods, and occasionally for digital goods. Facebook currently takes a significant cut (30 percent) for the virtual currency, though Groupon and LivingSocial both take roughly 50 percent of the revenue for a given deal.

Deals also puts Facebook on a collision path with Groupon and Living Social, in social commerce space, and with Google in advertisement space and income. Although it will be very hard for Facebook to compete with market leader Groupon, but when it comes to social network, it has one huge advantage: 600 million+ users.

Important: Facebook/Social commerce has the potential to shift several business models. For example, Retail banking with augmented realty- How about a bank branch inside FACEBOOK? This is not a remote possibility, especially when we already have bank branches inside Wal-Mart’s and TESCO's. Any Peer2Peer or Mobile Service provider can offer all these banking services at the place and time of customers preference. It is important to understand that the definition of banking is changing. In an interesting way, you do not need a bank license to participate in the banking industry ( eg: M Pesa , ZOPA, PayPAL). Will talk more about this in my later posts.

Update: 25April2011 : Facebook launches Deals against Groupon and LivingSocial in five major cities . The Deals launch will also be the first major push for Facebook’s virtual currency, Facebook Credits. Users will use credits to purchase offers from its Deals service.

Mobile Payment Services

2011-03-05T21:40:00.000-08:00

Some interesting Mobile Payment Services

NFC Payments by Oberthur

Book Review : The Facebook Effect - David Kirkpatrick

2011-03-02T23:53:00.000-08:00

Mark Zuckerberg celebrates his 27th birthday on May 14th; and what an achievement for this 27 year old!, founding (and holding 24% stake) one of the most remarkable companies of our times, valued anywhere between $50-65 billion.

Perhaps the most significant event in modern history has been the birth of social media networks. David Kirkpatrick’s The Facebook effect is an excellent description of Zuck’s genius, an inside story of how Facebook came about and the events and ideas that have shaped its development.

I found the early days of Facebook very inspirational. As it turns out, the story is fascinating, and somewhat complicated.

First impression: Wow!, I would love to work at Facebook. After reading this book, I am more impressed with its CEO Mark Zuckerberg.

Many of us use Facebook nearly every day, some of us multiple times a day, without giving much thought to how the world's most popular social network came to be. This book takes us right inside Mark Zuckerberg's head to understand the ‘potential of Facebook.

The book is divided in two parts, the first part is a fascinating corporate history revolving around reticent founder and Harvard dropout Mark Zuckerberg; the second is a thoughtful, analysis of the ‘Future of Facebook’.

If you are interested in startups or how marketing and advertising are evolving, or just how Facebook is changing the world, buy this book. It’s very readable and gives great insights into how Facebook grew from a dorm room to a huge company.

Excerpt : “Could [Facebook] become a factor in helping bring together a world filled with political and religious strife and in the midst of environmental and economic breakdown?” he adds later: “[Facebook] is altering the character of political activism, and in some countries it is starting to affect the process of democracy itself.”

While reading, I found myself imagining right there with Mark and other founders in their Harvard dorm. I almost felt like a fly on the wall in business meetings and informal brainstorming sessions.

The most fascinating part of The Facebook Effect, however, is Zuck’s vision of Facebook being, ultimately, an enabler to a better world. Mission of Facebook is to make the world more open and connected through sharing of personal information.

Few excerpts :

“Mark Zuckerberg was never one to defer to authority figures. Facebook started out as his own revolt against Harvard’s unwillingness to build an online Facebook. But what he built turns individuals into authority. The entire service revolves around the profile and actions of people. Facebook empowers them at the expense of institutions. “

Facebook now sits squarely at the center of the fundamental realignment of capitalism….but marketers can no longer control the conversation”

But this scale, rate of growth, and social penetration raise complicated social, political, regulatory, and policy questions. How Will Facebook alter users real –world interactions? How will repressive governments respond (as witnessed in the recent Jasmine revolution of Middle East) to this new form of citizen empowerment? How will controls work in this ‘digital democracy’?

“It is a platform. And, platform (e.g., MS-Windows) is a real big thing. Once you have a platform. People can start building things in your way. In short, you do not own a website. You own the world.”

If you know anything about Facebook and are curious about how internet technology is changing the world, then this is the book for you. As an industry professional and a passionate observer of ‘social’ trends, I find it fascinating to see Facebook, so effortlessly and seamlessly embedding itself in this fabric of internet’.

The Facebook Effect leaves you with a deep understanding of Facebook, its philosophies and, most startlingly, its power. You come away with a new awareness of how it is fast transforming into a directory of all humanity, carefully mapping our ‘social graph’ and ‘interest graph’.

Zuck cares deeply about Facebook’s potential to serve as a bridge between people. He will work to turn it even more into a town square for the global village.

Overall, I'd recommend this book to anyone wanting to have a better viewpoint on the social technologies that are changing our world.

Idea Diffusion : Ideas that spread Win

2011-02-23T07:45:00.000-08:00

Great Talk by Seth Godin

The Benefits to Government of Connecting Low-Income Households to an E-Payment System

2011-01-18T20:16:00.000-08:00

A good article on the opportunity in Indian Payments Market

The Benefits to Government of Connecting Low-Income Households to an E-Payment System: An Analysis in India - pymnts.com

200 Countries, 200 Years, 4 Minutes -Hans Rosling

2010-11-30T20:30:00.000-08:00

Web 2.0 Summit 2010: Vinod Khosla, "Innovation vs. Punditry"

2010-11-23T00:23:00.000-08:00

Rethinking the Mobile Web

2010-10-04T07:03:00.000-07:00

Check this very interesting presentation.

Rethinking the Mobile Web by Yiibu

View more presentations from Bryan Rieger.

Innovation and Collaboration

2010-09-15T23:35:00.000-07:00

Delivered a talk at IMRB(Indian Marketing Research Bureau), Delhi on 10 Sept 2010. Here is the presentation..

Innovation and collaboration

View more presentations from Gaurav Sharma.

Also here are few quotes on Creativity:

"The things we fear most in organizations - fluctuations, disturbances, imbalances - are the primary sources of creativity." - Alfred North Whitehead
"The chief enemy of creativity is 'good" sense.'" - Pablo Picasso
"As competition intensifies, the need for creative thinking increases. It is no longer enough to do the same thing better, no longer enough to be efficient and solve problems." - Edward de Bono
"Creativity is thinking up new things. Innovation is doing new things." - Theodore Levitt

After The Storm-Global Financial Crisis

2010-08-28T07:04:00.000-07:00

Delivered a talk recently at Fore School (Photographs)..here you go

After the storm- Global Financial Crisis 27 aug 2010

View more presentations from Gaurav Sharma.

Fault Lines- Raghuram G Rajan

2010-07-30T19:50:00.000-07:00

Yesterday, I attended a Global leadership Series Lecture by Professor Raghuram G Rajan, where he discussed in detail some of the factors outside the financial sector that led to the financial crisis.
While most of the news stories and public discussions over last two years have focussed on the 'greed of banking community', his observations on how the hidden fractures still threaten the world economy were quite insightful. He also shares these insights in his latest book 'Fault Lines' .

Well, the immediate suspects for this crisis seem to be – bankers, rating agencies, the Fed, Fannie and Freddie etc; but if we dig deeper and analyze, What went wrong? it becomes abundantly clear that, it was a crisis where not only the private sector was to blame, but also the government. It was a crisis caused by the faulty interface between the two.

Fault lines such as~Growing 'inequality' and Thin( or completely absent) Social Security net create tremendous pressure on the political community to find the easy route. i.e make cheaper credit available if they can't create that many jobs(as witnessed in the push for universal home ownership in the United States-extensive lending by Fannie Mae, Freddie Mac etc, low interest rates, targeted and relaxed lending to sub-prime borrower etc).

It is also apparent that the real reasons of crisis are still not addressed; the fiscal stimulus is only a temporary 'band-aid' solution. The world today needs to make hard choices to ensure greater stability and lasting prosperity.

The key idea of this talk (and his book) is to focus on slow-moving tectonic plates in the global economy: Consumption by borrowing in countries with fiscal deficits, Excess savings in exporting countries that are fiscally in surplus, and growing sophistication of the financial sector.

None of these movements might seem dangerous in itself, but when these plates come together and collide, the global economy can get badly shaken. To most players focused narrowly on their own positions, leave alone the movements of the plate they stand on, the earthquake - like this crisis - may seem an unfortunate happenstance.

In the analytical framework of Fault Lines, the crisis was not a pure accident and that more severe crises could arise in future unless the root causes are addressed sufficiently soon.

Please also check Paul Krugman and Robin Wells review of Rajan's book , and Rajan's response to it.

3E's - Energy, Environment & Economics

2010-05-14T06:23:00.000-07:00

A remarkable video about the forces shaping our Future.

People, Passion, Perseverance: You've Got Entrepreneurship- Steve Case

2010-03-05T00:46:00.000-08:00

Open Innovation

2009-09-10T07:59:00.000-07:00

In a world where strategy life cycles are shrinking, innovation is the only way a company can renew its lease on success. It’s also the only way it can survive in a world of bare-knuckle competition.

Not every management innovation creates a competitive advantage. Some are incremental. Some are wrongheaded. And many never pay off. But’s that no excuse not to innovate.

There are different flavors of innovation and can be stacked in the increasing order of importance as follows : Operational Innovation, Product and Service Innovation, Strategic Innovation, and Management Innovation.

With rapid transformation of businesses , the nature of relationship between consumers and the firm has changed radically.

Let’s take an example here of Open & Collaborative Innovation.

Who can forget the Ford Model-T? - large assembly lines , massive production units in Detroit, you could have any car as long as the color was black ( assumption here was that the end consumer is an undifferentiated lot).

Now compare this to Apple iPOD ( my favorite! ), the iPOD as a device is manufactured with partners across the globe - disk drive from Toshiba, display modules by Matushita and Toshiba in Japan, SDRAM by Samsung of Korea , Video processors by BroadCOM of Unites states, final assemble in China by a Taiwanese firm Inventec, and designed by Apple inc in California . The Music content is from large and small players across the globe (iTunes) and it is customized to the end users requirements.

There are other examples of customized service - iGoogle (personalized desktop) , TutorVista ( on-line tuitions)etc.The competitive arena is shifting from product-centric view of value creation to personalized user experience -centric view.

Gary Hamel in his latest book -”The future of management” clearly illustrates the message .."you cannot drive ahead by looking in the ‘rear-view’ mirror ".

Perhaps, financial services firms should take cue form this changing paradigm. Maybe we can start by asking - What is our competitive advantage ? Is it sustainable on a long term basis ? What can we do to change the paradigm of lending business (and in the process create immense value for stakeholders) ? Can we create value based on personalized experiences of consumer?

Cell Phones- Transforming Rural Life

2009-06-16T23:22:00.001-07:00

Just saw this wonderful presentation by Iqbal Quadir: The power of the mobile phone to end poverty. Iqbal is the founder of hugely successful Grameen Phone.

I am convinced about the power of Mobile telephony as an effective poverty reduction tool. Experiences like the Grameen Phone have shown that provision of phone connectivity to a village serves several purpose- it leads to the economic development by helping individuals and business gain economic efficiency through communications; it promotes social and economic development for individuals who own and operate the telephone enterprises.

One of the basic principles of the Information Age is that information can be a source of power, efficiency and cost savings.

More specifically for rural markets (an important and growing market for most products and services including telecom),the characteristics of the market in terms of low and spread out population and limited purchasing power make it a difficult market to capture. The Bottom of the pyramid marketing strategies and the 4 A's model of Availability, Affordability, Acceptability and Awareness is the solution here.

Successful cases like the Grameen Phone in Bangladesh and Smart Communications Inc in Philippines also provide us with some guidelines to tackle this issue.

Infact the benefits of mobile telephony can be grouped under three categories: (a) direct benefits; (b) indirect benefits; and (d) intangible benefits

Direct Benefits :Mobile telephony has a positive impact on the economic welfare in the following direct ways: (a) by generating GDP; (b) by job generation (both in the mobile industry and the wider economy); (c) productivity increases; and (d) taxation revenue (mobile operators are usually a sizeable contributor).

Indirect Benefits :In addition to revenue generation, the use of a mobile phone can itself produce follow-on economic and social benefit, e.g., enhance entrepreneurship, reduce information asymmetries and market inefficiencies and substitute transportation (resulting in another knock-on effect)

Intangible benefits: the mobile phone as a tool for: (a) aiding disaster relief; (b) enabling the dissemination of locally-generated and locally-relevant educational and health information; and (c) promoting social capital and social cohesion.

These examples point to a pressing need and an exciting challenge, representing a unique three dimensional convergence of technological capability, economic opportunity and societal need.

Find your 'ELEMENT' : Sir Ken Robinson

2009-04-11T10:19:00.000-07:00

Michelangelo once said “I did not create David, I merely discovered him. He was there within the stone, all I did was to chip-off parts which were not David”. So true, this statement clearly defines the role of parents, teachers and business leaders. Our job is to help discover the true talent by providing the right environment.

Sir Ken Robinson, a world renowned educationist and creative thinker, outlines the same in his excellent book: The Element: How Finding your Passion Changes Everything.
Here in this video-talk, Sir Ken, in his trademark humor, talks about the book and the need to find one's passion.
Don’t miss it.

Profit vs Market Share

2009-04-06T08:47:00.001-07:00

And the debate continues....

I have friends who work across various industries-FMCG, Retail, Telecom, Technology, Financial Services etc. We meet-up quite regularly and I often end up asking them a naive' question: So how is the company doing?

And invariably their answer is: "Great! we have the largest market share in this product category";" My territory market share has gone up by x% "; " Oh! We are feeling some pressure, our market share is falling".

Does this sounds familiar? , almost everyone seems to be talking about 'Market-Share', but very few talk about 'profitability'. So let me share my perspective on the same…

Market-share is a short term perspective, while Profitability is a long term perspective. It is easy to sacrifice profit under misplaced exuberance to achieve market-share. This is/was very much happening around us (in India) as I write…. Airlines 'burning' cash faster than they can burn fuel,Retail players risking their balance-sheets by getting into ‘leveraged expansion’ , Financial services companies (consumer-loans , credit-cards, Insurance) completely distorting their ‘cost structures’ to acquire maximum number of customers(market-share), irrespective of whether it makes any economic sense for the business or not.

Market-share is or should be a consequence. It is the result of doing the right thing. Market share is result of attractive products, excellent processes, customer service, and other structural strengths of the company. The focus should be on ‘profitable growth’. When a business is not profitable, it is a serious sign that something is not right.

Profitability gives the freedom to invest in opportunities for the future, to develop new products, to attract, retain, train and reward the best talent.

As some wise guy said “ The worst crime against working people is a company which fails to operate at a profit"

Delivering Happiness -Zappos.com

2009-03-20T10:00:00.001-07:00

Here is an excellent presentation by Tony Hsieh -CEO Zappos.com

Please note the vision statement:

"One day, 30% of all retail transactions in the US will be online. People will buy from the company with the best service and the best selection. Zappos will be that company" Important point to note..'they call themselves 'service company' not 'shoe or clothing company'.

Most important - their product is 'happiness'

Zappos - SXSW - 3-14-09

View more presentations from zappos

Vision shared-vs- Shared vision

2009-03-13T07:52:00.000-07:00

"The empires of the future are empires of the mind." — Winston Churchill

I promise to keep this post really short.

First a small exercise, if you are a senior manager in your company, go out and meet few frontline employees, and ask them this simple question: What is our company’s Vision?

Are you surprised with what they have to say? I bet you are…

So, is it important to have a vision for the organization? More importantly having a ‘shared vision’ rather than 'sharing a vision'.

We generally find so-called elaborate ‘vision statements’ adorning the wall in corporate headquarters or maybe briefly mentioned in ‘annual shareholders’ report.

But, is that enough?

A vision is like ‘soul’ of the company; its aspirations, and like north-star, guides it into the future. A vision can only be effective if it is espoused by each and every member of the organization.

Unfortunately, these days many employees believe that their work is simply a chore to perform in return for a paycheck. It is important for top management to ensure that every employee sees their work as a mission, in ‘sync’ with organizational vision. This can be achieved through ‘participative leadership’.

A clear vision sparks motivation, and drives performance, inturn leading to results.

I leave you with this thought and wonderful words by Antoine de Saint-Exupery, the French pilot and poet who once wrote: “If you want to build a ship, don’t herd people together to collect wood and don’t assign them tasks and work, but rather teach them to long for the endless immensity of the sea.”

Do leave your comments:

It is okay to fail...

2009-03-11T02:17:00.000-07:00

Let me begin by asking few questions?

-How important do people in your organization see innovation to be in their day-to-day jobs?
-How well is your organization recognizing and exploiting the diversity of its people's talent?
-To what degree does senior management encourage innovation by demonstrating that-'it is okay to fail'?

We literally see organizations struggling to create a sustainable culture of innovation. We know that mistakes and failures are critical part of the innovation process, but what is really required is an attitude towards acceptance of failure.

Try to create a culture that encourages experimentation. A culture that encourages enough experimentation so that there is failure. Reward the sensible experiments whose failure leads to new learning and other experiments. That’s where innovation grows!.....the more people are contributing, the more people are trying.

The most important things is not immediate success, but whether people are producing some results focused on innovation.

Better yet? Make sure that there is discipline in the organization to learn from unsuccessful attempts. Ask, what did we learn? What should we do differently? What else should we try?... An attitude of 'trail and learning’ is required, not that of '‘trail and error’.

What’s critical is to understand that the radical innovation is different from the incremental innovation.
So, if you want incremental improvements, reward only successful innovation; but if you want radical improvements, reward innovation efforts, regardless of their success or failures.

At the same time we need to make sure that nobody’s learning the wrong lesson:
-The correct lesson? It is important to try new things?
-The wrong lesson? If you fail, you will have a bad performance review.

The important thing is to fail wisely – Let me share few examples from Apple Inc- the Macintosh was born from the wreckage of the Lisa-an earlier product that flopped; the I-phone is a response to the failure of Apple’s original music phone, produced in conjunction with the Motorola. Both times apple learned from the mistake and tried again.

The wider lesson is not to stigmatize failure but to tolerate it and learn from it.

How about asking these two questions in performance reviews of all employees:
-How did you contribute to successful innovation at the organization?
-What were some of the new things you tried that didn’t work out?

The challenge for any corporation is to ensure a sustainable culture of innovation, wherein every member of the team is participative in the process.It goes beyond making PowerPoint presentation and deriving 'brownie' points. It requires serious comittment from the leadership team over a long period of time. It begins with an attitude that 'it is okay to fail'.

Consumer Finance - the way forward.

2009-02-20T05:35:00.000-08:00

A colleague who follows my blog suggested that I share my views on Consumer Finance (CF) industry. Consumer finance companies across the globe today hold the second largest share of consumer installment credit (after commercial banks).

Having keenly followed- the consumer credit processes and trends in the Indian market, key forces shaping the region’s consumer credit business, and understanding the functional capabilities of a successful business model; I decided to take a 'helicopter view' in terms of what went wrong with Consumer credit Industry (India story in particular)? But more importantly the way forward?

So let me do a quick brain-dump of questions/challenges (I rather see them as opportunities) for the Consumer credit industry…… (Not in any order of importance)

Reality check: What is the current state of the industry, what are the challenges to expect and where are the opportunities for growth? Defining the strategy for profitability, surviving and thriving in the midst of market volatility and slowing global economy. How the industry will shape up in the future?
Problem Identification- It is critical to correctly understand the factors currently impeding growth and operational capabilities required to become a first –class consumer credit player.
Managing risk: Understanding the risks CF industry is potentially exposed to in today’s economy. The rising default rates? How much risk is worth taking? Especially in the absence/presence of ‘developing’ credit bureau(s). Also, regulatory risks should be factored in.
Addressing atrophy –reluctance to change. Question the past practices and reinvent the business strategies. This requires finding people who believe in re-inventing the business. Re-evaluate the entire business model.
Revisiting the cost structure of the company (if large firms have no cost advantage, there will be more firms of various sizes, unless entry is artificially restricted). Cost management: Where do you slash costs? How do you determine what is unnecessary?
Erosion of Market segmentation in consumer financial services in recent years inevitably raises the issue of future industry structure-( Commercial banks and Microfinance players)
Creating winning strategies/Positioning- move from Product to solutions. (The customer wants ‘why’ not ‘what’, different solution for different people). Niche markets, customized product offerings. Fee based vs interest income. Maintaining profitability in difficult times, Re-positioning portfolio and maximizing revenues. Different strategies for different businesses- cards, mortgage, Auto finance, sales finance, Cash loans etc.
Focus on the lifecycle of the customer- (not loan tenor) what are different ways to acquire customers more importantly to retain the customer? Revenue contribution? X-sell process and cost structures. Engaging the customer: Increasing share of wallet and constructing a stronger relationship with customers.
Leveraging technology: How speed, convenience and technology translate to higher revenues and greater customer loyalty. The world is moving online: How changing demographics, advances in technology turn the potential into reality.

It is time to study the current scenario and develop a solution plan. As President Obama said during his inauguration speech, on January 21, 2009: “It's time to pick ourselves up, dust ourselves off, and begin the work of remaking ...”

I will write some more posts related to this very shortly and will also try to share my research paper on the same .... Next post will be on Banking 2.0

Do send emails/leave your comments..

Facebook retracts?...but why?

2009-02-19T03:04:00.000-08:00

Something very interesting happened yesterday….

In a late-night blog post responding to the recent outcry over a recent change to Facebook's terms of service, CEO Mark Zuckerberg said the social network's TOS will revert to a previous version.

So what really happened? If you dig deep, you will notice the real reason behind this retraction. Facebook found itself in an unenviable position in the face of strong public activism. Now this public/consumer activism is not something new, but of late this silent force has gathered quite a momentum with advent of technology. So here we had 80,000 + facebook users signing up for People against the new Terms of Service’. Facebook certainly was not prepared for this backlash from its own user base.

Most organizations today are grappling with a force that they don’t understand, one that is growing all the time. This force is broad, ever shifting, ever growing, and it is global. It encompasses blogs, discussion groups, Wiki’s, You tube... Consumers whom we have never met are rating the company’s products in public forums that we have no experience with or no way to influence.

Any person today with a broadband connection has a substantially better chance of influencing the public's perceptions of billion-dollar corporations than ever before. People connect with other people and draw power from other people, especially in crowds. ( Also refer to my earlier post on Tuangou)

This trend is unstoppable, and it affects every industry – media, automobile, financial services, healthcare etc.

Take the above Facebook example – case was well argued by lawyers and founders, but they lost out to the most powerful force on the internet- the People. And as we found out- people empowered by technology, won’t always go along.

To understand this better –let's do a quick test. Just Google your (company name + complaint) on the internet and read the search results carefully.

And now tell me- Do you see this as a ‘threat’ or an ‘opportunity’?

I for sure know that we cannot stop it, but if we understand it well and see this as an opportunity, we can certainly thrive in it. We need to understand that the traditional hierarchy of companies is being replaced by networks. Networks do not obey strict organizational protocols. Can we think of ways to collaborate with customers and partners by internalizing the power of social networks? I think we can...

Do post your comments…

The real crisis? We stopped being wise

2009-02-16T18:17:00.000-08:00

How are you different?

2009-02-04T18:04:00.000-08:00

Thinking about Future..... read a very interesting quote today. "Any piece of knowledge I acquire today has a value at this moment exactly proportioned to my skill to deal with it. Tomorrow, when I know more, I recall that piece of knowledge and use it better." - Mark Van Doren.

Truth be told , this statement succinctly captures the essence( and future) of knowledge worker. How will you differentiate your self in future? Is it on the basis of information you hold(or have access to)?

Fundamentally speaking information will cease to be the differentiator.Everyone would have access to any(read same) information that one needs. Google is just a step in that direction( any information/or the source of information is just a click away); Web 2.0 will look at creating more interactive tools for the Users.

So what is it, that will differentiate a Knowledge worker?

I think,It is the ability of the individual to use that information and create some ( innovative) value proposition. The future belongs to people who know how to use the information ( not only know ,where the information is?). And organisations will go out of the way to engage( in tangible and Intangible manner) such people.

Also this concept of Human resources seems to be vanishing. Think again!.... are you prepared for this shift?

The economics of giving it away

2009-02-02T23:29:00.000-08:00

Tough time calls for questioning!....especially in a period when ‘free’ goods and services online are becoming more and more popular…what are the challenges that entrepreneurs & business leaders face today ? Why the ‘zero-sum’ model doesn’t work alone?

How to monetize services when you are operating in a ‘freemium economy’- An economy where ‘few’ pay but ‘many’ use?. Imagine would some of the larger web 2.0 companies be around if it wasn’t for free services. Would consumers pay for Facebook, MySpace or Digg? I think the answer in most cases is ‘no.’

I think online businesses will have to look at providing real value to the users. Paid subscriptions can work only where there is true additional value provided. (LinkedIn is a good example)

So with the changing marketspace, Web startups now are having to comeup with a business model that brings in real money while they are still young.

Chris Anderson has a very interesting take on ‘the economics of giving it away’. He talks about the rapid shift in business model (mostly online) and why now ‘cash-flow’ is the king. I think this is a good read for anyone interested in online space. Chris has an advice for all would be entrepreneurs – ‘it’s now time to innovate, not just with new products but with new business models’.

Read it, leave your comments. Also refer to my previous post on ‘FREE’

Tata Jagriti Yatra(2)

2009-01-26T00:56:00.001-08:00

I recently completed this wonderful journey across the length and breath of the country.Yatra was good fun(more on that later).Wanted to provide these quick links :

(1) Official blog of Yatra

(2) Experiences of Yatri's

(3) Synthesis document of the Yatra

(4) To receive any further communication

(5) Photographs from the Yatra

Awakening Entrepreneurship: (Jagriti Yatra 2008)

2008-12-14T21:59:00.000-08:00

I wanted to do something similar for a long period of time- get to know the real India, meet up with social and business entrepreneurs, understand what drives them, study their business model and assess the impact, and all this in a highly charged up environment with bright, young, and ‘fresh’ minds.

Surely enough,I signed up for TATA Jagriti Yatra, the moment my friend Jayanti Datta told me about it. This is going to be exciting- 18 days on a train, 13 villages and town, exchanging ideas with 350 + participants, 8000 km, meeting and learning from 18-20 real ‘change makers’.

Tata Jagriti Yatra '08 ( 24 Dec 08 to 11 Jan 09) is a train journey across India to meet with and learn from bottom-up innovators and entrepreneurs who are changing and challenging the definition of ‘Impossible’ at a grass-root level.

We plan to visit several institutions and meet several social/business entrepreneurs such as: Jyoti Nayak ( Lijjat Papad) , R Elango (Kuthambakkam panchayat-Chennai), Dabbawalla’s of Mumbai, Arvind Eye Care (Pondicherry), TATA Steel (Tata Nagar), SEWA (Lucknow), Anshu Gupta( Goonj – New Delhi), Bunker Roy ( Bare foot College- Tilonia), Jaipur Foot, and AMUL etc.

This is an excellent step towards inspiring and empowering the youth of India by awakening their spirit of entrepreneurship.

I shall continue to blog about the experience (while onboard). I plan to approach this Yatra or journey of ‘self-discovery’ on several dimensions –

The big ‘Idea’ behind the venture;
Belief System: What drives these social entrepreneurs? Vision, community engagement etc.
Business Model: What, Why, How? Impact assessment, Scalability, Key drivers, other metrics( if available);
Debates/Discussions/Idea exchange among participants;
and much much more….:-)

I am really excited about exploring India with this extraordinary community.

Bootstrapping!

2008-11-26T03:28:00.001-08:00

Bootstrappers , as we now know, are people who build their businesses with sweat equity, not by writing intricate business plans, pursuing investment bankers, or wallowing in market research. Instead they focus their energy,intelligence,and skills on creating business that can thrive in a competitive environment. Bill gates bootstrapped Microsoft;Masaru Ibuku bootstrapped Sony,Pierre Omidyar bootstrapped eBay etc.

Guy Kawasaki wrote an excellent piece recently on American express Open forums : The Art of Bootstrapping. Have a look...

Is it still a logo ? if it changes everyday

2008-10-26T19:42:00.000-07:00

I asked a simple question to some of my friends in Branding,Marketing,and Advertisement -" Why is a company Logo important?and if it changes everyday-Is it still a logo?.

I was frowned upon at first and then in a very kotleresque manner was doused with marketing gyan; some obvious answers..

A good and unique logo is the first step to achieve brand recognition;
It shows what the company is about and it attracts people and is a good marketing tool to market the product;
A companies advertising and promotional efforts should be centered around brand image. A logo represents that image without saying anything. Its an extension of the brand and should merit its qualities; etc

Well I don't' disagree with the marketing and traditional views, but was wondering :-" Do we place too much importance on a Logo?". Google is a company that changes its logo almost everyday, and still is one of the most popular brands.

My quest led me to an interesting old post by Doug Edwards -director of consumer marketing and brand management for Google 1999-2005.

I will be happy to hear from readers what they think about this.....

Letting volunteers build your business

2008-10-20T21:02:00.001-07:00

Everyday millions of people make all sort of voluntary contributions to companies-from informed opinions to computing resources-that create tremendous value for those firms' customers and, consequently for their shareholders.In the Oct 08 issue of HBR, Intuit co founder Scott Cook suggests that companies should collaborate actively with their customers. This might not seem an insightful idea at first , but more deeply he explores the idea, the more profound it becomes.

Now the concept of user contribution isn't new, but the companies such as Google, ebay,Skype,Honda, Procter & Gamble, Hyatt, Amazon etc.- have created a user contribution system, methods for aggregating and leveraging people's contribution or behaviours in ways that are useful to other people.

The users can be Customers, employees, sales prospects-or even people with no previous connections to the company. Their contributions can be active(work , expertise,or information) or passive and even unknowing( behavioural data that is gathered automatically during a transaction or an activity).The system is a method usually Internet based,by which contributions are aggregated and converted into something useful to others.

Now the advantages of such a collaborative system :

-Cost advantage:what does wikipedia pays to authors and editors of its articles?same for Facebook, Myspace or Amazon book reviews..

-Scalability : ebay virtual shelf has 120 mn items, Wikipedia has more articles that encyclopedia Britannica...and it need not be broad or deep contribution( long tail)

-Competitive advantage : structural advantage because of network effort.

This is not limited to Internet based businesses, but old/traditional 'for profit' business have also started deriving benefits from this collaborative process : IBM, Newspapers,Toyota, Unilever,Banking etc.

So which all functions(in my company) can benefit from this user contribution systems:

Customer Service,Marketing,Employee Support, Capital resources,Design and development, Production etc.

Also refer to my post on open innovation .

Do Schools kill creativity?

2008-10-17T06:26:00.000-07:00

Sir Ken Robinson in his Out of our minds asks the same question.

"Throughout the world, companies and organizations are trying to compete in a world of economic and technological change that is moving faster than ever. They urgently need people who are creative, innovative and flexible. Too often they can't find them. Why not, and what should be done about it? Why is it essential to promote creativity? Organizations everywhere are concerned as never before with promoting creativity and innovation. Why is this so important? What's the problem? Why do so many adults think they're not very creative (and not very intelligent)? How do we lose the confidence to be creative? What should be done? Is everyone creative or just a select few? Can creativity be developed? If so, how? "

I remember an old quote by Picasso “All children are born artists, the problem is to remain an artist as we grow up.” Children often have extraordinary capacity when they are young, the problem is they start squandering it when they grow up.

Hence the question : Do schools kill creativity ? As we grow-Do we educate out of creativity? Many a times people change careers(stream) in schools, because the thing that they were good at was stigmatized.

Do we in our ecosystem( schools, communities, organisations) do the same?

Have we created an environment wherein it is uncomfortable to be different; not okay to fail or make a mistake.This straight jacket approach of living is depriving us of the immense possibilities (many a Picasso, DaVinci,Beethoven are getting lost in this one way traffic ).

Think about it....

Is The Importance of People Overrated?

2008-10-07T08:32:00.000-07:00

Scott Belsky of Behance.com has written an interesting post on American Express Open Forums.
He writes about the importance of 'chemistry' in successful teams.

So what is Team Chemistry?
Team chemistry or team cohesion, can be defined as a group dynamic that occurs when members of the team work together and make a united effort to accomplish the goals and objectives of the collective whole.

But the vital question is - Is chemistry a result (by product) of success or the cause of it ?

Still a good read....

Hot, Flat, and Crowded

2008-09-28T06:44:00.000-07:00

I have just started reading this new book by Thomas Friedman ...an eye opening account of current global environmental crisis. Friedman explains how global warming, rapidly growing populations, and the astonishing expansion of the world's middle class through globalization has produced a planet that is 'hot, flat,and crowded'. In just a few years it will be too late to fix things-unless there is a worldwide effort to replace our wasteful, inefficient energy practices with a strategy for clean energy.

He calls for Code Green . The world is getting crowded and hot. More people tapping computers and on the road means more competition for resources, more emissions. It's all "intensifying the extinction of plants and animals, and strengthening of petro-dictatorship."

Please note that there were just 1 billion people on this planet in the year 1850. The population has gone up by 6.5 times ( to current 6.5 billion) in the year 2008. No other species has seen this kind of growth in numbers. This number is likely to go up further to 9 billion by 2050. This raises the most important question:

-Where will resources to feed these people come from?

I have just read 100 odd pages and I am already convinced, that we need to act now!...or else we do not have a choice.

Most of us unfortunately do not realize the gravity of situation ; its like "you know, if you jump off the top floor of an eighty-storey building, you can actually feel like you're flying for seventy-nine stories.It's the sudden stop at the end that gets you."

To borrow from the book 'we are running an uncontrolled experiment on the only home we have'

I will post more as I read..

What is Tuangou?

2008-09-22T08:29:00.000-07:00

The power of groups, the clout that crowds can exercise to get what they want, is nothing new. What is new, however, is the dizzying ease with which like minded, action-ready citizens and consumers can now go online and connect, group and ultimately exert influence on a global scale.

Welcome to the world of 'CROWDShopping'.

Tuangou.es is a collective buying website in Spain. Tuangou essentially means (in Chinese of course!) 'tuan' -group and 'gou' - buy. Tuan gou ( teambuying in chinese) emerged from china in online chat-rooms,and graduated to more organised websites. Popular Chinese sites that are enabling crowds to first group online and then plan for real world shopmobbing are TeamBuy, Taobao and Liba.

A fun example of consumers aggregating their intended purchases to get a bargain is tuangou, or team buying, which involves strangers organizing themselves around a specific product or service. Think electronics, home furnishings, cars and so on. These likeminded consumers then meet up in real-world shops and showrooms at a coordinated date and time, literally mobbing the seller and negotiating a group discount on the spot.

Today only 1.3 billion people have access to internet. While the penetration is 80% + in countries such as US and UK...the figures are on lower side in China( 15-18%) ,India (20%),and Africa( less than 10%) . Imagine the impact (buying power) when the penetration in these countries go up to 50% levels.

Whatsay! - will Mobile phone ( 3 bn people in 2008) be the next converging(read aggregating) device?

To the marketers, the internet phenomenon offers both an opportunity and a challenge.Clearly no manufacturer can afford not to have a presence on the net.Presence on the net is required to inform,advertise and encourage the user feedback on products. It is not limited to just that Companies are already using the net to encourage user contribution to the development of the branch, its communication and product portfolio. (read my post on Open Innovation)

The opportunities offered by the net are only limited by our imagination.

Don't Wait Too Long to Become an Entrepreneur

2008-09-20T06:05:00.000-07:00

There was a good post recently on Harvard Discussion forums. Noam Wasserman initiated a conversation on 'when is the perfect time to become an entrepreneur' . He talks about the challenges faced by people transitioning from being big-company employees to becoming entrepreneurs.

His advise : Waiting for the "perfect time" to make the jump is usually futile, for there's no moment that's truly perfect. So even if you're early in your corporate career, when a winning new-business idea comes along and sparks an entrepreneurial passion in you, carpe diem.

I think the best or right time is when you see a right opportunity...time doesn't matters . I was reading a report on "India business houses -Family Fortunes" by a leading equity brokerage firm. Of course the names were obvious-Tata, Birla, Premzi, Mittal, Ambani , Aggarwal(Vedanta), Goenka(RPG), Singh(DLF) etc . The common points across all success stories were :

(a) Ability to identify opportunity well ahead of others;

(b) Effectively using leverage (OPM);

(d) Perseverance -not giving up in the face of difficulties ; Passion.

In fact none of them went for money..they all created solutions to help millions ( and in the process made their fortune!).

Also read an interesting post by Sanjeev Bikhchandani on Entrepreneurship- It's not about the money!

Sanjeev says " ...Entrepreneurship is about freedom, creating, a chance to build a brand, an institution, showing the world a new way of doing something, being your own boss, creating a legacy that will outlive you, identity, making a difference, obsession, ego, having a shot at something big, doing what you love, innovating, doing things your way…….."

He sure knows his stuff .

Ofcourse there is no harm making your billions while helping others. Profits are certainly better than wages! whatsay ? ..keep you ideas flowing

McKnight Principles

2008-09-15T09:42:00.001-07:00

William L. McKnight, who served as 3M chairman of the board from 1949 to 1966, encouraged 3M management to "delegate responsibility and encourage men and women to exercise their initiative."

His management theories are the guiding principles for 3M. His basic rule of management was laid out in 1948:

"As our business grows, it becomes increasingly necessary to delegate responsibility and to encourage men and women to exercise their initiative. This requires considerable tolerance. Those men and women, to whom we delegate authority and responsibility, if they are good people, are going to want to do their jobs in their own way."Mistakes will be made.
But if a person is essentially right, the mistakes he or she makes are not as serious in the long run as the mistakes management will make if it undertakes to tell those in authority exactly how they must do their jobs."Management that is destructively critical when mistakes are made kills initiative. And it's essential that we have many people with initiative if we are to continue to grow."

So what was this guy saying?

He says ‘delegate’, which essentially means trust your people’s ability to deliver.
He says ‘it is to okay fail’ because when you try out new things failures are likely to happen.
He says ‘encourage initiatives’…this is not by writing grand vision statements, but by conducting yourself in the right manner. Giving‘latitude’ to employees to do their own thing. (Google’s 20% work culture fits here)

Time to think…

The Future of Internet Search

2008-09-10T20:05:00.000-07:00

Today on the Official Google Blog, Marisa Meyer posted an in-depth look at what the future of Internet searches holds. She shares many interesting thoughts.. She asks a lot of important and interesting questions on the direction of search and how searches will be performed in the coming years.

The most interesting ones she touches on are the "location" and "social" values that can be attached to search.

To search for ‘pizza’ or ‘water hole’, location plays a key role. So if Google knows where you are –it will help deliver relevant results.The social aspect is also worth noting. How do we cull the collective information of our friends -- or simply those around us -- to find the information we need.

Here are some of her thoughts:

Search needs to be more mobile -- it should be available and easy to use in cell phones and in cars and on handheld, wearable devices that we don't even have yet…….. You should be able to talk to a search engine in your voice. You should also be able to ask questions verbally or by typing them in as natural language expressions. You shouldn't have to break everything down into keywords.

Further, why should a search be words at all? Why can't I enter my query as a picture of the birds overhead and have the search engine identify what kind of bird it is? Why can't I capture a snippet of audio and have the search engine identify and analyze it (a song or a stream of conversation) and tell me any relevant information about it? Services that do parts of that are available today, but not in an easy-to-use, integrated way.

In the next 10 years, we will see radical advances in modes of search: mobile devices offering us easier search, Internet capabilities deployed in more devices, and different ways of entering and expressing your queries by voice, natural language, picture, or song, just to name a few. It's clear that while keyword-based searching is incredibly powerful, it's also incredibly limiting. These new modes will be one of the most sweeping changes in search.

She continues at length. I highly suggest you read the Official Google Blog and her comments…

'Lose the Battle to Win the War'

2008-08-26T06:59:00.000-07:00

A wonderful story - in Corporate Dossier, Economic Times, 22 August 2008 .

A learned sage was in the middle of a very narrow bridge when he saw a powerful king approaching from the other side.

“Please turn around,” said Shakti-muni, “So that I may pass.”

“No, you turn around,” thundered the king, “So that I may pass.”

“But I stepped on the bridge first.”

“Yes, but I can push you back.”

“That’s not fair. Know that I am a teacher, a priest and the most respected philosopher in the land. Hence, I must be given the first right of passage.” Argued the sage

The king sneered, “I built the school you teach. I pay for the rituals you perform. Without me as patron, you would not be able to indulge in philosophy. So you must give me the first right of passage.”

So the arguments continued, each one refusing to give way to the other, each one justifying why the other should turn back. Finally, the king raised his whip and struck the sage. Furious, the sage cursed the king, “You have behaved like a demon, so may you turn into one.” Instantly, the king turned into a demon – a man-eating demon. He pounced on the sage, opened his mouth wide and ate him whole.

What mattered more – crossing the bridge or crossing the bridge first? ......read more here

The Paradox of Adjacency

2008-08-08T10:38:00.000-07:00

An interesting article appeared this morning in The Economic Times : The Paradox of Adjacency by Ashish Singh and Chris Zook of Bain and Company. I have written to Ashish with my views.

Yes Nokia-India is a successful example of ‘adjacency strategy’. While product proposition for entire consumer spectrum (BOP included) and Product Innovation did contribute to its success, there were other factors which contributed in equal measure, such as: Quick to identify the Opportunity (1995)-ahead of Change curve, Localizing the business strategy, Focus on core business ( Nokia only had mobile phones , while other players had consumer electronics and home appliances) etc.

Google is another great company at identifying ‘adjacent opportunities’. From Google search to Google Video to Google Books to Google News to You tube ....

However, we have also seen many unsuccessful attempts at adjacency strategy, for example:

Reebok’s foray into fashion wear;
Intel’s foray into digital media and Internet space;
Starbucks-which tried to get into ‘grab and go customers’ express format is shutting down 600 stores in US alone.

These mixed results raise few obvious questions:

Is it beneficial for an organization to expand (to adjacent market) even though there is enough ‘cheese’ at the center? Is there an inherent danger of ‘spreading too thin’ or ‘getting strayed’?
If the adjacency opportunities are so obvious, why do most of the companies fail to identify them? I know it’s a common observation that many firms, especially larger ones, are limited in their tendency to exploit the abundance of lucrative opportunities that surface from within, but how to overcome this ‘cognitive inertia’?
How to identify the true potential of adjacent markets, given that data is limited?
When to press the ‘go’ button? and how to successfully transition into ‘adjacent territory’ without diluting the existing core (am assuming resources are limited and opportunity cost associated)?

Let me know what do you think?

The art of collecting stories

2008-07-27T08:30:00.001-07:00

Just watched an inspiring talk by Jonathan Harriss at TED.com (Artist and computer scientist Jonathan Harris makes online art that captures the world’s expression — and gives us a glimpse of the soul of the Internet).

This guy sure knows how to tell stories.....'the baloon project is captivating

Ask Questions?

2008-07-24T10:26:00.000-07:00

Ask the question, play the fool. Don't ask the question, stay the fool.

In today’s world, the old ways of doing business no longer produce the results nor provide the value they once did. Organisations are constantly faced with having to find new and better ways of operating. Consequently, one of the top challenges that leaders face is that of enhancing creativity within themselves and within others.

In taking on this challenge we must first comprehend the intimacy of the relationship between creativity and thinking. Our ability to be creative depends upon our capacity to think, which in turn depends upon our ability to question not only our practices, but also our beliefs and assumptions. We must learn to question the limits of our thinking. It is through this manner of questioning that we are able to rethink our thinking. Thus, the quality of our questions determines the quality of our creativity.

Have you noticed how creative people are the ones asking questions?

Lots of people saw apples fall. Sir Issac Newton asked why and explained gravity.
Lots of people wanted instant photos. Edwin land asked how and invented Polaroid cameras.
Lots of people wanted fast shipping.Fred Smith asked when as started FedEx.

The single most important element in an innovative company is the creativity of their people. Creative thinkers don’t win by conforming to a given set of rules. Rather they reinvent the game by asking the challenging questions .
How often do you ask HOW ? WHEN ? WHY?

Should every company have a corporate blog?

2008-07-22T09:57:00.000-07:00

Mario Sundar, Community Evangelist at LinkedIn makes some very good observations : Should every company have a corporate blog?

We are witnessing the evolution of corporate blogs in transforming organisations culture.
Corporate blogs enable the humanisation of entire value system . This collaborative culture encourages the exchange of ideas and information in a boundryless environment.

Idea Spotting

2008-07-20T23:36:00.000-07:00

Sam Harrison is his book IdeaSpotting makes a very important distinction between 'data-based insights' and 'exploration based creativity'.

He states that there is nothing wrong with backbone data or raw statistics. They are fine as far as they go. The problem is they do not go far enough.

To spot ideas, one need insights. Lots of them. Because Ideas aren't spotted in forms. They are spotted in sights- those revelatory insights seized only when you roam new turfs, meet new people and have new experiences.

Light bulbs weren't invented by exploring candles.
Iron ships weren't made by exploring wood boats.
Skyscrapers weren't designed by exploring bungalows.
Cell Phones weren't conceived by exploring landlines.

To get past what's stifling you, Move beyond what's staring you in the face.

Indeed one of the best books on Innovation and creativity that I have read recently....Highly recommended!

One to One Innovation-CK Prahlad

2008-06-27T03:39:00.002-07:00

CK Prahalad and M S Krishnan in their new book " The new age of innovation' drive home a very interesting point.

N=1 and R=G ( N= Personalised co created experiences , R=G Global access to resource and talent).

The book reveals that the key to creating value and the future growth of every business depends on accessing a global network of resources to co-create unique experiences with the customers, one at a time. Even if the company is dealing with a hundred million consumers, each manager must focus on one consumer experience at a time. The firm can provide the platform around which customers can co-create their own experiences. ( Eg Google, My Space , Apple IPod , Starbucks etc).

Check these links...

( Tutor Vista - Online Tu ting try spotting N=1 , R=G)

( Pomarfin - a Finnish company known for left foot concept, which offers customised footwear for men using foot scanning technology).

Lessons of the Square Watermelon

2008-06-26T03:39:00.000-07:00

A great story doing round these day….This story is a great reminder of the power of creativity and innovation. The story revolves around the growing of square watermelons in Japan. I'm posting the story verbatim.

Japanese grocery stores had a problem. They are much smaller than their US counterparts and therefore don’t have room to waste. Watermelons, big and round, wasted a lot of space. Most people would simply tell the grocery stores that watermelons grow round and there is nothing that can be done about it. But some Japanese farmers took a different approach. ”If the supermarkets want a space efficient watermelon,” they asked themselves, “How can we provide one?” It wasn’t long before they invented the square watermelon.

The solution to the problem of round watermelons wasn’t nearly as difficult to solve for those who didn’t assume the problem was impossible to begin with and simply asked how it could be done. It turns out that all you need to do is place them into a square box when they are growing and the watermelon will take on the shape of the box.

This made the grocery stores happy and had the added benefit that it was much easier and cost effective to ship the watermelons. Consumers also loved them because they took less space in their refrigerators which are much smaller than those in the US - which resulted in the growers being able to charge a premium price for them.

What does this have do with anything besides square watermelons? There are a five lessons that you can take away from this story which will help you in all parts of your life. Here are a few of them:

1.) Don’t Assume:

The major problem was that most people had always seen round watermelons so they automatically assumed that square watermelons were impossible before even thinking about the question. Things that you have been doing a certain way your entire life have taken on the aura of the round watermelon and you likely don’t even take the time to consider if there is another way to do it. Breaking yourself from assuming this way can greatly improve your overall life as you are constantly looking for new and better ways to do things.

2.) Question Habits:

The best way to tackle these assumptions is to question your habits. If you can make an effort to question the way you do things on a consistent basis, you will find that you can continually improve the way that you live your life. Forming habits when they have been well thought out is usually a positive thing, but most of us have adopted our habits from various people and places without even thinking about them.

3.) Be Creative:

When faced with a problem, be creative in looking for a solution. This often requires thinking outside the box. Most people who viewed this question likely thought they were being asked how they could genetically alter water melons to grow square which would be a much more difficult process to accomplish. By looking at the question from an alternative perspective, however, the solution was quite simple. Being creative and looking at things in different ways in all portions of your live will help you find solutions to many problems where others can’t see them.

4.) Look for a Better Way:

The square watermelon question was simply seeking a better and more convenient way to do something. The stores had flagged a problem they were having and asked if a solution was possible. It’s impossible to find a better way if you are never asking the question in the first place . Always ask if there is a better way of doing the things that you do and constantly write down the things you wish you could do (but currently can’t) since these are usually hints about steps you need to change. Get into the habit of asking yourself, “Is there a better way I could be doing this?” and you will find there often is.

5.) Impossibilities Often Aren’t:

If you begin with the notion that something is impossible, then it obviously will be for you. If, on the other hand, you decide to see if something is possible or not, you will find out through trial and error.

Story Link and more photos : http://pingmag.jp/2007/07/12/strange-watermelon/

Cognitive Inertia

2008-06-25T03:29:00.000-07:00

How did Kodak respond to the threat of 'digital Camera' in 1980's ?What factors distinguish successful firms from unsuccessful firms?

It’s a common observation that many firms, especially large firms, are limited in their tendency to exploit the abundance of lucrative opportunities that surface from within the firm. As a result of the incumbent firm’s failure to support exploitation of these opportunities, some intra-preneurs are encouraged to become entrepreneurs by founding a start-up organization. In many a cases, founders of these new firms would have preferred to exploit their entrepreneurial discovery within their previous firm, given sufficient management support and resources.

So what went wrong? Research suggests that cognitive inertia is one powerful explanation as to why established firms are not as innovative as young, less established firms. Gladwell throws in a very interesting perspective to this.

It might be worth the effort to understand why most of the organisations,of today, are struck up in 'time-wrap'.For example, Kodak's management suffered from 'confirmation bias'. i.e. What has worked for us in the past will work for us in the future! Nokia too is the victim of this bias and is fast loosing out to Apple in Mobile devices.

The Ant philosophy by Jim Rohn

2008-06-20T23:32:00.001-07:00

Over the years I've been teaching kids about a simple but powerful concept - the ant philosophy. I think everybody should study ants. They have an amazing four-part philosophy, and here is the first part: ants never quit. That's a good philosophy. If they're headed somewhere and you try to stop them, they'll look for another way. They'll climb over, they'll climb under, they'll climb around. They keep looking for another way. What a neat philosophy, to never quit looking for a way to get where you're supposed to go.

Second, ants think winter all summer. That's an important perspective. You can't be so naive as to think summer will last forever. So ants are gathering in their winter food in the middle of summer.
An ancient story says, "Don't build your house on the sand in the summer." Why do we need that advice? Because it is important to think ahead. In the summer, you've got to think storm. You've got to think rocks as you enjoy the sand and sun.

The third part of the ant philosophy is that ants think summer all winter. That is so important. During the winter, ants remind themselves, "This won't last long; we'll soon be out of here." And the first warm day, the ants are out. If it turns cold again, they'll dive back down, but then they come out the first warm day. They can't wait to get out.

And here's the last part of the ant philosophy. How much will an ant gather during the summer to prepare for the winter? All that he possibly can. What an incredible philosophy, the "all-that-you-possibly-can" philosophy.

Wow, what a great philosophy to have - the ant philosophy. Never give up, look ahead, stay positive and do all you can.

Seven Highly Effective Ways to Kill Innovation

2008-05-01T06:12:00.001-07:00

Come on Smart guys,Do your Innovation Check....

Innovation killer#1: Believe that innovation will “just happen.”

Innovation killer#2: Tell everyone to “think outside of the box,” hold a brainstorming session, then call it a day.

Innovation killer#3: Lay the success of innovation solely on IT’s shoulders.

Innovation killer#4: Create an obstacle course for ideas.

Innovation killer#5: View “different” and “new” as bad.

Innovation killer#6: Hand over the good ideas to the Legal and Accounting departments.

Innovation killer#7: Be very, very afraid of failure.

Complete article is available here :

Even Eagles need a push

2008-04-29T10:27:00.003-07:00

Something wonderful shared by a dear friend...

The eagle gently coaxed her offspring toward the edge of the nest. Her heart quivered with conflicting motions as she felt their resistance to her persistent nudging. "Why does the thrill of soaring have to begin with the fear of falling?" she thought. This ageless question was still unanswered for her.

As in tradition of the species, her nest was located high on the shelf of a sheer rock face. Below there was nothing but air to support the wings of each child. "Is it possible that this time it will not work?" she thought. Despite her fears, the eagle knew it was time, her parental mission was all but complete. There remained one final task – THE PUSH.

The eagle drew courage from an innate wisdom. Until her children discovered their wings, there was no purpose for their lives outside the nest. Until they learned to soar, they would fail to understand the privilege it was to have been born an eagle. The push was the greatest gift she had to offer. It was her supreme act of love. And so, one by one, she pushed them and they flew.

We must remember that success begins when we understand that life is about growing; it is about acquiring the knowledge and skills we need to live more fully and effectively.

Democratization of Innovation

2008-04-06T07:36:00.000-07:00

Schumpeter model of Innovation states that . ‘a disruptive innovation is a technological innovation, product, or service that uses a “disruptive” strategy, rather than a “revolutionary” or “sustaining” strategy, to overturn the existing dominant technologies or status quo or products in a market’.

In many ways innovation is the single most important building block of competitive advantage… giving a company something unique that its competitors lack.

Innovations can be thought of as falling onto a continuum from evolutionary to revolutionary and therefore categorised into two groups:(1) Incremental or evolutionary innovations that improve the performance of established products, services or business models; or(2) Disruptive breakthroughs which lie at the core of entrepreneurial activity and serve as the basis of future technologies, products, services and industries.

Examples of Disruptive innovations are galore…IPod , Google , Mobile Phone , Post IT (3M) etc. similarly Incremental innovations through … ITouch , Google-finance , Mobile Phone with camera/FM etc.
Organizations do realize that ‘innovation’ is not just limited to developing new products and services but, more fundamentally, about discovering new ways to create value’

Coming back to the node of collaborating and leveraging social networks to create value , organisations will have to look at democratization of innovation.

I recently read somewhere that , Nokia - collaborates with local universities and technology institutes to facilitate exchange of ideas . And in order to manufature its highly differentiated range of premium A8 cars , Audi worked closely with Alcoa to learn how to use aluminium instead of steel in its cars.

Some of you might also want to check American Express Labs! - an interesting framework to understand the trends and develop new products.
think about it..

Making Innovation everyone's Job

2008-03-27T21:01:00.000-07:00

I am reading "The Future of Management," by Gary Hamel and Bill Breen; a wonderful book with great insights.

An excerpt....

Collapsing entry barriers, hyperefficient competitors, customer power—these forces will be squeezing margins for years to come. In this harsh new world, every company will be faced with a stark choice: either set the fires of innovation ablaze, or be ready to scrape out a mean existence in a world where seabed labor costs (Chinese prisoners, anyone?) are the only difference between making money and going bust.

Given this, it is surprising that so few companies have made innovation everyone’s job. For the most part, innovation is still relegated to organizational ghettos—it is still the responsibility of dedicated units like new product development and R&D, where creative types are kept safely out of the way of those who have to 'run the business'.

Today innovation is the buzzword du jour, but there’s still a yawning chasm between rhetoric and reality. If you doubt this, seek out a few entry-level employees and ask them the following questions:

1. How have you been equipped to be a business innovator? What training have you received? What tools have you been supplied with?

2. Do you have access to an innovation coach or mentor? Is there an innovation expert in your unit who will help you develop your breakout idea?

3. How easy is it for you to get access to experimental funding? How long would it take you to get a few thousand dollars in seed money? How many levels of bureaucracy would you have to go through?

4. Is innovation a formal part of your job description? Does your compensation depend in part on your innovation performance?

5. Do your company’s management processes—budgeting, planning, staffing, etc.—support your work as an innovator or hinder it?

Don’t be surprised if these questions provoke little more than furrowed brows and quizzical looks. Truth is, there are not more than a handful of companies on the planet that have, like Whirlpool, built an all-encompassing, corporatewide innovation system.

I will talk about Whirlpool in another post.... in the meantime, Go read the book

Social Lending-Prosper

2008-01-18T17:07:00.001-08:00

Who needs a bank to borrow money ? surprised !!..well check these few links Prosper , Zopa

The idea behind Prosper, and a handful of sites like it, is to allow peer-to-peer lending. It's lending enabled in large part by technology that allows bite-size payments to be processed online profitably.
(Prosper is founded by Chris Larsen, one of the old hands at consumer finance).

The website lets lenders bid against each other on the interest rates they are prepared to offer to specific borrowers.

There are risks, to be sure. The biggest is defaults. Prosper's average net default rate—based on the amount of money that is defaulted after collections—from Nov. 1, 2005, through Dec. 31, 2007, for all credit grades was 4%. That's roughly in line with defaults on credit cards. Portfolio size is approx USD 140 Mn.

What needs to be seen is how this model will evolve? Is the model scalable? How is money collected in case of default and cost implications? Also data on Operating Leverage or NIM would help...

Facebook as Intranet

2008-01-14T18:10:00.001-08:00

Sometime back i heard this story that Serena Software is making 'Facebook' it's official Intranet. I did not believe it, but here it is...

http://www.fastforwardblog.com/2007/11/28/serena-has-adopted-facebook-as-their-intranet/

Welcome Enterprise 2.0 !

What Next..Employee less organisation - not that far fetched what say?

KIVA – Loans that change lives

2007-12-20T18:37:00.001-08:00

While reading Stanford News Magazine came across this story:

Kiva means “unity” in Swahili, and was founded in October 2005 by Matt and Jessica Flannery ( Stanford University Alumni)

What ? :Kiva Microfunds is an organization that allows people to lend money via the Internet to small businesses in developing countries

How it Works ? :Kiva allows microfinance institutions around the world, called "Field Partners", to post profiles of qualified local entrepreneurs on its website. Lenders browse and choose an entrepreneur they wish to fund. Kiva aggregates loan capital from individual lenders and transfers it to the appropriate Field Partners to disburse and administer. As the entrepreneurs repay their loans, the Field Partners remit funds back to Kiva. Once a loan is fully repaid, the Kiva lenders can withdraw their principal or re-loan it to another entrepreneur.

Lenders' funds are transferred to Kiva through PayPal, which does not collect its usual fees in this case. Field Partners generally charge interest from their borrowers, although Kiva claims to keep track of how much interest is charged and will not work with those charging unfair interest rates. Kiva lenders do not receive any interest because of US Government regulations. Kiva claims that its borrowers have a historical repayment rate of about 99.7%.

Few questions I am curious about :

(1) Scalability of this model;

(2) Operating Cost ( considering the pay-pal charge waiver is not there)

(3) Impact quotient etc.

FREE - Must Watch Video - Chris Anderson

2007-12-08T19:34:00.001-08:00

This is the trend to watch out for ...

This is a great Video where Chris is discussing about his new book.
Chris Anderson is the editor-in-chief of 'Wired' Magazine and the author of 'The Long tail'

The Wisdom of Crowds

2007-12-06T19:30:00.000-08:00

James Surowiecki’s The Wisdom of Crowds: Why the Many Are Smarter Than the Few and How Collective Wisdom Shapes Business, Economies, Societies and Nations makes a good read.

The book talks about the aggregation of information in groups, resulting in decisions that, he argues, are often better than could have been made by any single member of the group.
However , Not all crowds (groups) are wise. Consider, for example, mobs or crazed investors in a stock market bubble. Etc.According to Surowiecki, these key four elements are required to form a ‘wise crowd’.

Diversity of opinion -Each person should have private information even if it's just an eccentric interpretation of the known facts.
Independence -People's opinions aren't determined by the opinions of those around them.
Decentralization -People are able to specialize and draw on local knowledge.
Aggregation –Some mechanism exists for turning private judgments into a collective decision

A must read....

LEADERSHIP: It’s Not About You

2007-11-21T04:34:00.001-08:00

An earlier version of this essay appeared in Stanford Business alumni magazine.

A couple of years ago, former General Electric CEO Jack Welch visited the Stanford Graduate School of Business to talk about leadership and his book, Winning.

“The day you become a leader, it becomes about them,” Welch said. “Your job is to walk around with a can of water in one hand and a can of fertilizer in the other hand. Think of your team as seeds and try to build a garden. It’s about building these people,” he insisted. “Only you will know the team.”

That’s right. The minute you move from being a task-oriented professional to being a manager of people, it stops being about your individual talents, your successes, and starts being all about coaching, motivating, teaching, supporting, removing roadblocks, and finding resources for your employees. Leadership is about celebrating their victories and rewarding them; helping them analyze when things don’t go to plan. Their successes become your successes. Their failures are yours too. Too many people today think leading is exclusively about their own performance. Even some of those who become CEOs, usually highly intelligent people who worked hard to get where they are, turn into self-aggrandizing individuals once they hit the executive suite.

Too many people, perhaps encouraged by the media, have developed an obsession with leaders. In his book on hierarchies, Top Down, Hal Leavitt covers a broad range of issues. Leavitt, who is the Kilpatrick Professor of Organizational Behavior emeritus at the Business School, surmises that part of today’s infatuation with the leadership discussion springs from the fact that we perceive organizations have become flatter, when they are still hierarchies, though changed ones that are “participative” and “groupy.” They have become harder to navigate with chains of command that are less clear. As a result, leadership qualities are more necessary for managers at every level, not just for those at the top of an authority pyramid.

Although it is difficult to find common characteristics among acknowledged leaders (What would Winston Churchill have in common with Mother Teresa?), Leavitt identifies three recurring themes of leadership: Transformation, Persuasion, and Competence. Leaders are able to transform or change a situation. They can influence others and motivate them to follow. They exude confidence and competence about what they are doing that inspires others. At the Business School, we have created a leadership development program that gives students experiences and coaching to help recognize and reinforce some of these qualities.

Of prime importance, in my view, is the notion that leadership is about change and a leader must leverage those who work for him or her, empower and support them with regular feedback, rewards, and exchange of ideas. Of course, sometimes leaders have to “weed the garden” in Welch’s pithy vocabulary. The tough job of firing and hiring is part of creating an effective team.

One person, no matter how talented, cannot accomplish much in a managed organization of today’s complexity and global reach. Transforming through others is the job of the leader at any level. Said Welch when he was here: “The day you become a leader, your job is to take people who are already great and make them unbelievable."

'Quiet Time' & ' No- Email' Day at INTEL

2007-11-08T05:45:00.001-08:00

Read the company blog.........a great step!

http://blogs.intel.com/it/2007/10/quiet_time_on_track_no_email_d.php.

Google's "70-20-10" Formula

2007-09-22T19:58:00.001-07:00

According to CEO Eric Schmidt, 70 percent of their resources are channeled to the core business of internet search and advertising, and 20 percent is channeled to adjacent products such as desktop and product search services. The remaining 10 percent is focused on highly experimental products - innovations important for the long term.

Liisa Välikangas, Managing Director of the Woodside Institute, wrote an interesting piece called The golden spur: Innovation independence. In it, she reveals some surprising facts about the importance of personal independence in the innovation process.

For instance Google's independence formula is particularly revealing: the company has a management philosophy that requires it to dedicate 10% of its investment to employee- initiated projects unrelated to the core business.

It is observed that the importance of efficiency and reliability in business has stifled our freedom to explore new things. The author argues that the “freedom to explore” factor is essential to innovation. And innovation is essential to sustained competitiveness. Today's leadership challenge is learning to manage the independent thinkers who refuse the constraints of professionalism and instead innovate on their own terms – in other words, as amateurs.

This freedom is facilitated by communications technologies that enable individuals to participate increasingly on their own terms. Companies need to unleash their human talent and raise their level of innovation so that they can compete globally. To accomplish this, managers must respect their employees' independence – the very source of innovation. Liisa further states that the case for innovation is the case for the labor of love, that is, the work of passionate amateurs.

Honeybee Network - Grassroot Innovation

2007-09-16T07:10:00.001-07:00

http://knownetgrin.honeybee.org/honeybee.htm

Check out the above link …It is about a remarkable person and a remarkable organisation.The HoneyBee Network was incubated by Prof. Anil Gupta at IIM Ahmedabad in 1988. The Network uncovers and documents grass root innovations from rural and small town India and tries to spread the knowledge and helps the inventors get a fair economic reward for their creativity.

Crowdsourcing- The Long Tail

2007-09-14T07:10:00.000-07:00

The word was first coined by Jeff Howe in a June 2006 Wired magazine article.

Wiki : Crowd sourcing is a neologism for the act of taking a task traditionally performed by an employee or contractor, and outsourcing it to an undefined, generally large group of people, in the form of an open call. For example, the public may be invited to develop a new technology, carry out a design task, refine an algorithm or help capture, systematize or analyze large amounts of data (see also citizen science).

The term has become popular with business authors and journalists as shorthand for the trend of leveraging the mass collaboration enabled by Web 2.0 technologies to achieve business goals.

Recently read "The Long Tail " by Chris Anderson . It is a must read for anyone who wants to understand the future of business. The book gives a very interesting perspective on : what happens when there is almost unlimited choice? It also shows why online models Amazon, Ebay etc are so successful by adhering to the 'rules' of long tail.

The future of business does not lies in 'hits' but in 'misses' ( the endless long tail). He refers to the concept of 'crowd-sourcing' quite liberally. Some examples of crowdsourcing that come to my mind...Wikipedia , InnoCentive, Threadless , Amazon , Netflix etc

Diruptive thinking

2007-09-12T02:00:00.000-07:00

Recently attended a video conference by Prof Richard D'avani (Tuck School of Business-Dartmouth,VA) on 'Hyper competition' . What should companies do in an competitive environment to succeed? and what should be the right strategy...?

One insight gained is..' self-cannibalization'..i.e...rather that wait for the competition to assail and rip apart the competitive advantage, firms should constantly engage themselves in continuous innovation. Being first is not always the same as being the best. Entry barriers are trampled down or circumvented.Goliaths are brought down by clever Davids with slingshots. We've seen and heard the stories in corporate world - Ford vs Toyota , Merill Lynch vs Schwab , Yahoo vs Google, Microsoft vs Sun Micro system etc etc.

As competition enters, the industry always shifts from Monopoly( only one player, excessive profits) to Oligopoly ( few more players , sustainable profits) to Perfect Competition( many players , no Abnormal profits). Hence to stay and continue enjoying that phase of (sustainable or excessive profits) , the companies should disrupt the market place on a regular basis( i.e constantly innovate and redefine the rules of the game) ...such that competition will always have the 'catching up' to do.

Take for example what happened to Ford in US ( huge distribution, service and dealer network panning American continent);in came Toyota with "TQM" and cars that didn't need repair and wait time for delivery. Ford was always engaged in 'catching up' by asking " what is Toyota doing next?" , while Toyota was busy self-cannibalizing its competitive advantage and moving ahead by asking " what next?" Or for that matter..what happened to the music industry in last one decade is for everyone to see. The digital revolution has crossed all barriers and changed the music industry today. Maybe the advent of "I" ( Apple's I-Phone and I-Pod) is a just the beginning ( more on this later...)

Innovation Redux

2007-09-11T20:05:00.002-07:00

Google's Marissa Mayer gave an interesting presentation at Stanford University.
Here is a snapshot of her presentation : (This holds good for any company, society etc be it FMCG , Financial Services, Hi tech, education etc)
Notions of Innovation redux :

Ideas come from everywhere- why set boundaries?
Share everything you can – Open culture.
You're brilliant, we're hiring – hire smart people.
A license to pursue dreams- Employees get a "free" day a week. Half of new launches come from this "20% time".
Innovation, not instant perfection- beta test, don’t kill the idea by overdoing.
Don't politic, use data: Data is supreme; don’t’ say I Think; say this is what data says.
Creativity loves restraint -Give people a vision, rules about how to get there, and deadlines.
Don't kill projects -- morph them -There's always a kernel of something good that can be salvaged.
Every project yields lessons that should always be reviewed, shared, and applied.

Efficiency vs/and Creativity

2007-09-10T19:43:00.000-07:00

Having read considerable literature on 'creative process' mapping, sometimes I wonder, how should organisations balance the equation between Efficiency( viz. results) and Creativity?

Will relentless emphansis on efficiency make a company less creative?
Can you set up a process around 'Innovation' , which by its very inherent nature is a disorderly process?
Can a 'creative mindset' be used to hard-wire a company( on processes)?
How to decide between 'sameness' ( as demaned by quality process Six Sigma) and 'uniqueness' (as valued by Creativity)?

While process excellence demands precision, consistency and repeitition, innovation calls for variation , failure, and serendipity.
Let me know your views...

Memoirs from IIM-A

2007-07-07T01:37:00.000-07:00

Background : I am here to attend a Corporate Education programme at IIM-A ( organized in association with Duke Fuqua Business School, United States)

Today's session was about exploring the possibilities. Understanding the various environments we operate in and how to identify trends. Marty Anderson - an amazing prof. from Duke - with domain expertize in Business innovation ,process re-engineering and High tech; took us through the 'brief history of economic trends" development and how it is going to change our future?

Some food for thought :

What economic power can 2.6 billion people have over remaining 4.0 billion people?
What will happen, if china decides to send 300 million people from 'mainland' to the 'African' continent?
How will a wireless ( Mobile handheld) change the way we live, in not so distant future?
Can "electricity" solve problem of 'world peace'?
What is common amongst 'Grameen Phone" , Google , Apple , Ebay,Amazon ?

I personally feel ( since innovation is my area of interest) that it is absolutely critical for us to acknowledge that we are at the 'cusp of global shift'. Never before( in the known history of human civilization ) has technology and innovation played such an important and accelerating role in transforming the way we live.

Think again :

I-Pod from Apple has redefined the music industry( is it high tech-I doubt!), but what is powerful is the entire business proposition based around a single concept' that people no longer want to buy music albums, they want to buy songs' hence give them the option to combine their own 'playlist'
The worlds biggest library is just a click away ( or better still Google it);
Grameen Phone has changed the way we perceive communication companies.
Zopa.com , Bill me later.com etc are changing the way we 'lend' or 'borrow'.
Mobile phone penetration across globe is 3.6 billion;can it change the way money moves?we are already seeing huge progress in M-commerce.
Blogging - who needs a newspaper, publisher or editor; the future of embedded thinking.

more on this later.. the dinner was announced 20 minutes ago.