Post on 03-Apr-2018
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EntrepreneurWhen we will refer to an Entrepreneur, we
will not limit our definition to include only those
who are founders of organizations or Businesses.
Our definition of Entrepreneur will refer to the
person who has final power in the business, who
directs the company, and the one who takes
commercial risks relating to ownership of thecompany
Profile of an Entrepreneur Profile of an Entrepreneur1 Self Confident
1 Only you Know if you have it Now2 Have you taken major Decisions in
your life?
3 Self Assessment Test4 Self Assessment Test
2 Have you been taking important decisions inyour life?
3 Do you feel alone & helpless when facedwith difficult decisions?
4 Do you hesitate to ask for help when reallyrequired?
5 Can you start a project and take it tocompletion in spite of obstacles?
6 Can you take an important decision and stickto it when challenged?
7 Do you like to be in charge and beresponsible for the situation?
Self Assessment Test7 Do other people deal with you with respect
and trust you?
8 Are you ready to work long hours with littleimmediate compensation?
9 Do you like dealing and meeting with peoplewhen there is no real compulsion?
10 Can you persuade people to go along withyour dream?
11 Do others easily understand your conceptsand ideas?
12 Do you want to start a business more thananything else?
Profile2. Value Freedom and are very Disciplined
1 Freedom is not do what you want todo when .
2 Entrepreneurs do not like some onebreathing their neck. Will take orders
only from competent people
3 Responsible for Employees &Customers
4 BIG B3. Flexible&Opportunistic
1 IBM Computers as a general purposemachine
2 Flowing River, with the emerging flowof events
3 Journey of a Photographer to anEvent Manager
4 Softcell Ability to read patterns onthe wall, flexibility and ability to Seize
the moment
5 Profile4. Entrepreneurs work hard & are Goal
oriented.
1 AzimPremji works 70 hours a week2 Ability to work Unsupervised
5. Entrepreneurship is about being Egoless
1 Success becomes your biggest Enemy2 Customers will keep you waiting3 Rigid Stand in negotiation does not
help
6. Entrepreneurs love and Value money
1 For some it is Power2 For others it is a way to Contribute3 Use it as a Transition
Common Traits
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1 Have they spotted the opportunitiesinstantly?
2 Do they see the big picture?3 Do they have complete conviction about
Idea?
4 Are they able to connect the opportunitywith their innate capability?
5 Are they passionate about their line ofbusiness?
INTRAPRENEURSHIP The Spirit of Entrepreneurship within an
Existing Organization
Interest in Intrapreneurship1 Intrapreneurship is, spirit of
Entrepreneurship within an Existing
Organization
2 Doing your own thing, your way to createsome thing on your own.
3 Xerox Technology Venture (XTV) is aprominent example (PARC)
4 Single Persons Imagination5 Invention & Innovation6 A Cannon Intrapreneur invented Contact
Lenses Software
7 Entrepreneurial spirit is necessary in order toinnovate (Flexibility, Growth &
Diversification)
Intrapreneurial Activities1 New Business Venturing2 Innovativeness3 Self Renewal4 Pro activeness Corporate VS Intrapreneural Culture1 In the Corporate Culture the decision is
based on Data collection
2 In Traditional culture emphasis is onfollowing instructions & protecting oneself
3 Corporate follows hierarchical systems.Intrapreneural system is flat with
1 Networking2 Team work3 Sponsors4 Mentors
Comparison Traditional Manager Intrapreneur Comparison Traditional Manager Intrapreneur Transformation Process1 Organization operates on frontier of
Technology
1 Apple iPhone, iPod &iPad2 Searle Neutrasweet3 Amul VergisKurian
2 Develop processes to Indentify hiddenpotential
1 NEC (Enterpreneur Search)2 Xerox
3 Trial & Error encouraged1 3M2 Searle
4 No Opportunity Parameters1 Does not follow Hierarchies2 No departmental Barriers3 Transformation Process
5 Resources are made1 Available
1 Accessible3 Multidisciplinary Team approach
1 People from different departments
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2 Match employees for creativity withteam diversity (Functions, Age,
Gender, Education, Culture, Mind-set)
5 Long time Horizon1 Outlook of a VC2 Not sitting on your head
6 Voluntary Program Transformation Process9 Multiple Channels for new idea Approval
1 Several Yes. But one No can kill theIdea
2 3M has multiple channels10 Establish Competitive Spirit
1 Motorola several teams for itswireless division
2 IBM had 6 teams working on the PC11 Kill your own Products
1 Star Bucks, Benetton2 HLL & P&G3 Microsoft4 HP mandate - 60 % new products, last
3 years
Leadership Characteristics1 Understands the Environment2 Is Visionary & Flexible3 Creates Management Options4 Encourages Team Work5 Encourages Open Discussion6 Builds a coalition of Supporters7 Persists Establish Intrapreneurship process1 Top management should initiate the process
after getting convinced thoroughly
2 Consultants & Internal Champions to beidentified
3 Focus areas&Ideas to be identified, includingfunding & resources
4 Should use technology to maximum possibleextent
5 Sponsors & Mentors to be identified6 Establish strong support structure7 Reward performance8 Review the performance of the various
initiatives
Success of IntrapreneurshipVenures1 Success not as much compared to the
independent ventures
2 However focused efforts have yielded results1 3M2 IBM (PC, ATM, Industrial Robot)
Family BusinessWhat exactly is a Family Business
1 The family owns a High % of Share Capital2 Family members employed at Higher
Positions
3 Expression of intention for familyinvolvement
4 Generations of the same family involved5 Controledby direct decedents of the Founder6 E.g. Birlas, Khetan, Goenka, Jindal, Bajaj
Unique Position
Advantages
1 Long term Orientation2 Family Culture is a source of great pride3 Functions on a less Bureaucratic manner4 Greater Willingness to come out of bad times5 Training the young members
Disadvantages
1 Confusing Structure
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2 Autocratic Style3 Young Generation may not be worthy4 Strenuous Succession battles5 Family Members may drain money
The Founder
1 Duel Role1 Head of the Family2 Head of the Business
2 Set the Vision3 Build the Organization4 Involve Family Members constructively5 Succession Planning
Next Gen
1 Difficult task to carry the Legacy2 Cant make sweeping Changes3 Load of Expectations4 Faced by Changing business scenario
Entry of Family Members
It is a continuing issue and the Founder must
develop some ground rules
What about those who want to come back?Or wish to have part time involvement?
Should they be first inducted? Or skilled? Should they be encouraged to join
irrespective of their capabilities?
Role of New Entrants
1 Offer Existing Position or New Role ?2 What happens if she is given a preference?3 Should the role suite her abilities?4 Is the entrant interested in existing business?5
Some considerations to be successful ?
Involve the old generation
Step by step approach
Get their trust
Compensation
1 Different family member live different LifeStyle
2 Contribution to the business is not equal3 Older people expect to be paid higher4 Family members are paid more than others5 The rise of a family member is faster &
often
Non Family Members
Challenges
1 Cant aspire for the top positions2 Have to train the young generation3 For FM the challenge to retain them
Creating Environment
1 Discuss career paths transparently2 Offer Compensation benefits at par3 Involve them in top level discussions4 Emphasize their contribution in meetings5 Treat family members at par in office6 Involve in discussion on succession planning7 Offer perks to Senior people8 Periodically assess Motivation & Relationship
Succession Issue
Necessary because of old age, health, death and
legal issues
Emotional, Cultural as well as Legal issues
Choosing a Successor is not easy task
Grooming a Successor is more difficult
Succession Strategy
Benefits of early entry
1
Becomes familiar with the Business
2 Develops relationship with others3 Develops on the job skills4 Good performance leads to credibility
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Benefits of late entry
1 Success outside leads to credibility2 Brings Best practices from the industry3 Broad business perspective4 Competence is jugged objectively
Best Practices for Succession
1 Open communication in the Family & theBusiness
2 Independent roles early on in the business3 Importance of Shared Vision4 Documentation5 Conflict Resolution
Grow or not to grow?
Rajshree Chemicals is one of the oldest chemical
companies founded by the late father of Sunil &
Rajesh, both being equal partners in the family
business. They operate from one office but from
different floors.
Sunil has 2 daughters who are happily married. He is
content with the business, wants the status quo.
His younger more dynamic brother Rajiv, has 2 sons,
both of whom are out of college. Rajiv wants to
expand the business, but is stopped by Sunil every
time there is an opportunity.
You are the CA/Consultant to the firm. What will you
recommend Rajiv as a way out?
Should you get a Professional outside CEO?
Entrepreneurship Technician, Manager & Entrepreneur The Entrepreneur VS Ordinary People1. Warrior takes every thing as a challenge,
Normal people take life either as
Blessing
or
Curse
1. People defend what they already know,Successful people have an insatiable need to
know more
2. Entrepreneurship is a never ending processand not a Stage to be reached
3. Business it a Reflection of life - Honestly,Instantly and Directly
Entrepreneurial Myth1. More businesses close down than they start2. The myth is people who start the business do
so with an Entrepreneurs mind- set
3. Most people start with a Technicalbackground
1. Carpenter, Electrician, Plumber2. Hair Dresser, Script writer, Web
Designer
FATAL ASSUMPTION
If you understand the technical work of the
business, you understand the business that does
the technical work
Biggest Limitation of a TechnicianIf the Technician did not know how to do the
technical work of the business, he would have to
learn how to get it done.
The 3 Personalities1. All of us are three personalities in one
1. The Entrepreneur2. The Manager3. The Technician
2. They want to be the Boss but not want tohave a Boss
3. Story of1. Fat Guy2. Fit Guy
The Entrepreneur1. Turns most trivial things into exceptional
opportunities
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2. He is the Visionary, the Dreamer, the catalystfor change, in all of us
3. He is the Creator Steve Jobs, Tom Watson,Ray Kroc
4. Likes change all the time5. The Entrepreneur lives in the future6. Other people are a problem for him7. The Entrepreneur therefore wants control The Manager1. The Manager Brings Planning, Order &
Predictability
2. He fits everything into Boxes3. Entrepreneur lives in the Future, Managerlives in the Past. Hewants status quo4. Enterpreneur wants Change VS Order5. Entrepreneur looks for Opportunities against
Problems
6. Manager lives in a house & wants to staythere
7. The Manager creates rows of things8. The manger cleans the mess The Technician1. He is the doer, believes in doing everything
himself
2. Without him nothing will get done3. He is comfortable with doing one thing at a
time
4. The Technician lives in the Present5. For him the manger is a threat6. Entrepreneur is an idiot, most ideas of the
Entrepreneur do not work
7. And for both the Technician & the Manager,Entrepreneur is the root cause
Evaluate Yourself1 Entrepreneur ?2 Manager ?
3 Technician ? The Technicians Fate
3 Phases
Infancy
Adolescence
Growth
Infancy (Technician's Phase)1 Free of a Boss and do what he wants to do2 Life is easy to start with, he knows the job3 In the beginning, the owner & business are
one thing
4 As business grows, the work gets on him5 He also has to do what he doesn't know how
to do
6 The master juggler begins to drop some ofthe balls
7 There is no getting rid of a boss Adolescence (Managers Phase)1. The technician decides to take some help2. Accountant is the best choice, who knows it
all
3. He starts depending completely on theperson with a hope to get free
4. Shortly, the accountant stats makingmistakes
5. It is because of management by Abdicationrather than management by Delegation
6. You have two choices1. Shrink Back2. Continue Resolutely
What went wrong1. Lack of anticipation & Planning additional
demand, skills, people, capital, space etc.
2. Lack of understanding of the other 2 roles1. Role of a Manager2. Role of an Entrepreneur
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3. He failed to educate himself sufficiently, sothat the businesss foundation & structure
can carry additional weight
4. By asking the right questions where do I wishto be, when do I wish to be there, how much
How to set it Right1. You will be failing at times, but planning is
required
2. Write it down cleanly for yourself and others3. Nothing written, nothing committed, nothing
concrete
4. In the process of defining the future, the newreality emergesYou stat living The future
in the present
5. Mature companies start differently than therest and continue that way (with a vision
that shapes the present)
The Entrepreneurial PerspectiveEvery day was devoted to business development
and not doing business
We didn't do business, we build one
Choosing the Core Team High Performance Entrepreneur Team Capabilities of the Core Team
Ability to bring business, ability to produce & deliver,
the ability to read numbers and the ability to
negotiate with the investors.
The Founding Team1 Proven Competence & Pull ones weight
1 Someone who has created hisenvironment
2 Led the team through corporaterough waters
3 Ability to pull his own weight4 Dont choose a well known retired
person without knowing his
deliverables
2 Complementary Composition1 Competency as well as Attitude &
Temperament
2 The Team can be air dropped in aforest & will Survive
3 Multitasking Capability1 Business should continue without
missing a beat
2 Business is like a relay race The Founding Team4 Shared Vision
1 Leaders job is to create Vision & articulate it
2 Being a leader in the Industry VS first Million
4 Transparency1 Need to sit down &Share before
decide to start
2 What ever impacts the businessneeds to be shared
5 Personal Integrity & Mutual Trust1 Integrity is not about convenience. It
is a non issue
2 Your deserve the employees &customers you get
3 Develop Integrity Policy within theorganization
The Founding Team7
Ability to question & take disagreement
1 Diversity in thinking is constructive2 Take a Strong position. However,
outside the board room we are
friends
8 Resilience is above everything else1 Sheer ability to hang on- Business,
Personal & Other
2 Get back in the Saddle again3 Wipro & IBM in 1990, 88 MG Road
office
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9 Sense of Humor1 Humor is a serious matter2 Company Jokes & Pranks3 Who should you not give Stake
Consultants People promising you business thro contacts Lawyers & Accountants
Venture Capital Breathing life in your Child Stages of Business Development Funding1 Early Stage (Angel)
1 Seed Capital2 Start Up
2 Expansion (VC)1 Second Stage2 Third Stage3 Forth
3 Acquisitions
Description
Small amount to prove concept & financial
feasibility.
Product Development & Initial Set up. No
commercial sales yet.
Working capital for Initial Growth. No positive cash
flow / Break-even yet
Rapid Sales Growth. Positive Profit
Bridge financing. Go Public.
Assuming control of another company
How does a VC operate ?1 Professionally managed pool of EquityCapital2 Equity Pool is formed by Limited Partnership
of
1 Wealthy Individuals2 Pension Funds3 Foreign Inventors
3 The pool is managed by general partner ofthe VC firm in exchange of a fee & % of Profit
4 Investment is done at different Stages1 Early Stage2 Expansion Stage3 Acquisition Stage4 Operations of VC
5 VC participates by involvement1 Monitoring the Portfolio2 Finance Planning3 Impart business skills
6 VC gets his money when1 Firm is taken over by another
company
2 In the event of going for an IPO Nature of Indian VC Industry1 Silicon Valley has popularized concept of VC2 In India it is a nascent industry
1 Local companies have not yetparticipated
2 Some large banks run VCs as a part oftheir portfolio
3 A few foreign VCs are operational inIndia
3 Most wealthy individuals prefer to parkwealth in real estate as
VC $ Invested VC Raised by Stage of Business
(2002)
1 Seed & Start-up 02 %2 Early Stage 23 %3 Expansion 57 %
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4 Later Stage 18 %Factors for Investment Decisions
1 Low Risk2 Lesser deals to be Evaluated3 Less Monitoring4 Quick Returns Capital Raised by Stage of Business Types of Risk Capital Markets1 Informal Risk Capital Market2 Venture Capital Market3 Public Equity Market Informal Risk Capital Market1 Equity participation by Invisible wealthy
individuals
2 Virtually in accessible to manyEntrepreneurs, but it is alargestpool of Risk
Capital Market
3 Investors seek to understand the Industry &have a need to monitor progress of the
company
4 Considerations1 Risk /Return Ratio2 Management Team3 Commitment4 Business Area
Who to approach?1 If your needs are small, raise money from
your own resources - Family, Fools & Friends
2 If your plan is ambitious, approach AngelInvestor
3 As business develops contact a VentureCapitalist
4
Your VC will help get you funds for the nextstage
5 Finally go the Acquisition or IPO route Philosophy of VCs
1 VCs objective is long term capitalappreciation. The companys objective is
survival and growth
2 Early stage financing attracts a risk. VCexpects more return and invests lesser
amount
3 The VC may not seek control of the company.However, will keep at least one seat on theboard
4 He will leave the day-to-day operations tothe company. Will offer financial help,
advice, management planning and contacts
5 Since it is a long term relationship, VC willexpect transparency and trust, no surprises
Investment decisions by VC1 Investment decision is both an Art & Science
1 Art Intuition & Gut feeling2 Science Systemic approach, Data
gathering
2 Investment Portfolio Mix1 Number of Early Stage, Expansion &
Buy outs
2 Nature of Industries & Companies3 Volume of Investment4 Geographical area5 VCs Expectation from the Company
3 Strong Management Team1 Solid Experience & Background2 Personal Commitment & Investment3 Positive Family Support4 Ability of the team to Execute
2 Unique Product Opportunity
1 Growing market2 Diversity of the Market
3 Patents & Certifications
VCs Expectation3 Capital Appreciation
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1 Stage of Involvement2 Amount of Capital Invested3 Return/Risk Ratio4 Available Exit Options
4 Downside Risk
1 Assessment of Risk2 Steps to mitigate the Risk3 Investment Process
2 Preliminary Screening1 Executive Summery2 Detailed Business Plan
3 Agreement on Preliminary Terms1 Compatibility2 Amount of Money Involved3 Control4 ROI5 Exit Option
Investment Process3 Due Diligence
1 Survey & Meetings with all RelatedParties
2 Financial Statements4 Final Approval
1 MOU with all Terms & Conditions2 Engage a competent Lawyer
Self Evaluation1 Do you understand the Market,
Competition?
2 How many similar companies operate in thespace?
3
Why will you Succeed in the market?
4 How will you get your first Customer?5 How will you Reach the customers?
(Distribution)
6 How will you Retain them?7 How will you Scale your Business? Approaching a VC1 Understand the area of his focus2 Approach in a professional business manner.
Send a well conceived Business Plan
3 Take time to seek out an Introduction4 Be ready with a well thought out Oral
Presentation
5 Develop early Rapport & Chemistry6 Do not resort to a very Rigid Approach Guidelines for Dealing with VCs1 Avoid Shopworn2 Do not discuss the deal with other VCs3 Approach thro reliable Contact & discuss
fees
4 Do not include intermediary in initialmeetings
5 Test market the concept for a few customers6 Be careful about what is Projected &
Promised
7 Disclose problems/negative situations rightin the first meeting
Guidelines for Dealing with VCs8 Reach a reasonable understanding with the
VC regarding timeframe of response
9 Do not sell the project based on responsefrom other VCs
10 Be careful about statements like there is nocompetition for this product
11 Do not show Financial Ignorance12 Do not show concern for past problems13 It is not love at first sight Guidelines for Dealing with VCs
14 Do not try to impress the VC or be too friendly
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15 Be careful about VCs who do not want toknow your business (Dumb Capital)
16 Be concerned about the color of money17 Find out the track record of the VC18 Take commitments from him19 Go with a VC who treats you at Par20 Approach VC only when absolutely required21 Frugality is a great Virtue
Factors in Valuation1 Nature and History of the business2 Outlook of the Economy and the Industry3 Net Value (Book Value) of the Stock4 Weighted Average of Earnings of the
company less Costs
5 Dividend paying capacity of the company6 Goodwill and other intangibles7 Previous stock of sale8 Market price of the stock of similar
companies in the Industry
Breaking NewsAssume that you have been very lucky and
get considerably big fortune from an unknown
relative. You have decided to become a business
Angel straight out of college.
What will be your Investment objectives?
The Road not Taken1 Mouthshut.com
1 CEO Faisal Farooque2 P2P information exchange on
products and brands by consumers
themselves
2 Plug HR1
CEO PrashantBhaskar
2 Manages HR in 30 companies across 7industries in 5 cities.
Market Driving Strategies Strategic Perspective CEOs Demand1 CEOs Demand their organizations to be
Innovative
2
Stress Radical & Discontinuous innovations
3 Market Driven Companies:Current practice uses, Market Research for well
defined segments - HLL, P&G and Nestle
4. Market Driving Companies:Successful Pioneers - Amazon, IKEA & Starbucks
have created new markets.
Market Driven Market Driving Market Driving Arvind Eye Hospital1 Founded in 1976 in South India by 58 year
eye surgeon, Dr. Venketaswamy
2 His vision was to serve 20 million residentIndians blind from Cataracts
3 The Hospitals in India fall into 3 categories:1 Private Hospital2 Government Owned3 Rural Areas
4 Dr. Vs vision was to serve both the Rich &the Poor for modern cataract surgery almost
equally
Arvind Eye Hospital5 The Sales, Advertising & Promotion is
focused on serving non paying patients
6 The sales peoples target is to get poorpatients
7 The profit of AEH is 50 % even though 65 %patients served do not pay. No charity
8 The Operative process is like an assemblyline, similar to McDonalds Hamburger
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9 In 2002 AYH served 1.2 million patients &performed 2 Lac eye surgeries
Market Driving Approach1 AYHs approach, resembles that of Amazon,
Dell, IKEA, Wall-Mart & Sony
2 Market Research seldom leads to a Breaktrough
3 Market Driving firms see the worlddifferently, their vision addresses deep
seated, latent customer needs
4 Henry Ford said If I had listened tocustomers, I would have given them a faster
horse
5 Rather than focusing on the market share inthe existing markets, they create their ownmarkets
Market Driving IKEA Style1 The furniture retailer, IKEA in 2008, had
70,000 employees, in 30 nations, turnover of
11 Billion
2 Rather than copying, what everyone else wasdoing, they did things totally differently
3 The model of Traditional Retail furniturestores
1 Established Customers2 Costly retail locations3 Expensive independent designers4 High finished product inventory5
Labor intensive manufacturing
6 Expensive delivery to the Customers
Market Driving IKEA Style4 IKEA Style
1 Young families2 Clean Scandinavian design3 Inexpensive peripheral locations4 Low prices5 Immediate delivery
6 Pleasant shopping experience7 Transportation & delivery by the
customer
5 Instead of learning from existing customers,teach potential customers their drastically
different value proposition
Characteristics of Market Driving Companies1 Lead by Vision rather than Market Research2 Redraw Industry Segmentation3 Create new Price Points for Value4 Educate Customers for Sales Growth5 Reconfigure Channels6 Exploit the Buzz Network7 Exceed Customer Expectations Redraw Industry Segmentation1 AYH did not accept the normal segmentation
as Rich & Poor
2 Southwest Airline destroyed segmentationbetween Ground & Air Transportation
3 Wal-Mart Demonstrated that small ruraltowns can support large discount stores
4 SAP developed and deployed Enterprisesoftware instead of functional
Departmental software
Lead by Vision
1 Customers cant visualize revolutionaryconcepts and technologies by themselves.
2 For Titan, Market research proved otherwise3 Fred Smith of FedEx, track the Package4 Sam Walton of Wal-Mart, Save and at the
same time, enjoy a better life Style
5 CCD, No one will pay Rs. 75 for a cup ofcoffee
6 Employees are motivated by Vision of thefounder rather than the pay cheque
Create new price points for Value
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1 Southwest Airline, AEH, Dell and Wal-Martcreated new price points, which other
companies could not quickly replicate
2 Star Bucks & FedEx, Disney World - Premiumprices and offered the customers a value
proposition and experience they could not
refuse
Educate Customers for Sales GrowthPrimary job of Market Driving companies is, not to
sell but to educate the customers
1 AEH You can have a normal vision2 IKEA Affordable, State of the Art furniture3 Wal-Mart Discount Store4 Amazon Buy Online Reconfigure Channels1 FedEx Used its own planes, in a Hub &
Spoke system, over traditional Point to Point
2 Wal-Mart Insists that P&G rationalizeproduct lines also eliminated the wholesales
are distributors
3 Dell Direct Eliminated middle men4 Amazon Internet over a physical book store Exploit the Buzz Network1 South West Airlines Customers are our
ambassadors
2 Nike did not run a single advertisement ontelevision till it was a 1 Billion company. Their
initial stagey was Word of Foot
3 Virgins Richard Bransons Hot AirExpeditions
Exceed Customer Expectations1 Arvind Eye Hospital2 East West Airlines3 Wal-Mart Stores Barriers to Market Driving in Established
Firms
1 Overturn Industry Expectations
1 Established companies reactnegatively to surprises
2 People cant unlearn existingpractices however irrelevant
3 Kodak & Digital Technology2 Market Driving Ideas are Risky
1 Involve much higher risk of failure2 Even can destroy individuals career
Barriers3 Market Driving Consistently lose to
Incremental Innovations
1 Resources go to well proven,established technologies
2 R&D also favors tangible, familiarbusiness projects
4 Market Driving Ideas kill the existingbusiness
1 IBM Focused too long on MainframeBusiness
2 Microsoft stuck to its productbusiness
Market Driving Transformation Process1 Develop process to Identify Hidden
Potential:
NEC every year invites proposals for their
own start up companies
2 Allow space for failure:
3 M allows 15 % of the time for researchersfor projects of their own choice
3. Match Employees for Creativity:
Mix diverse capacity of people to mix
together Sex, Nationality, Religion, Experience
Transformation4. Multiple channels for new Idea Approval:
Approval of a new business idea needs all Yesand a single No can kill it
5. Establish competitive teams:
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Motorola makes it wireless divisions
compete with each other. IBM had 6 teams working
on the PC
6. Kill your own products:
HP fosters competition amount its own
division. Star Bucks opens a new outlet near to its
successful outlets
Solutions Business Perspective Need for Solutions
Enhance Customer Value Design Products for Services1 In a Product company services are used as a
tactical weapon.
2 Products are developed in a modular fashionto facilitate Plug and Play. Sales value is
always high.
3 Post sales implementation is not easy and istoo costly.
4 For a Solutions company services itself is aproduct. Own, Complementary,Competitors.
Turnaround of IBM1 Between 1991-1993 IBM made a loss of $16
Billions. Lou Gerstner, ex AMEX became the
CEO.
2 Issues at IBM1 Sales people sold what R&D provided
them.
2 Closed Company with inside view.3 Gerstner made customer visits a priority
1 IBM had the entire portfolio.2 Customers needed integration.
4 IBM Global Services (IGS) provided whatcustomer. wanted instead of Greattechnology.
Product Opposite Focus
1. Most companies expect their sales teams to push
products as a part of solutions e.g. Mutual fund
companies.
2. IBM, through IGS has taken a stand to be product
neutral. They have tied up with 200 partners - HP,
Dell & Sun, Oracle.
3. IGS is a part of the larger eco system and trusted
consultant.
4. Taking over of IT of AMEX and HDFC Bank, with
Service Level Agreements.
5. However it has a long way to go. Solutions
provider is a journey and not a destination.
Does having Great Products hinder solutionfocus?
The Price Factor1 Unlike products, Solutions pricing is not an
easy decision
1 Integration of Products and more2 Services are not standardized
2 Solutions Price is a Trade off between1 The Value offered to the customer2 Cost of doing so to the company
3 Pricing Mechanism1 One Time2 Periodic Payment3 Pay as Use4 Investment5 Licensing/Franchising6 Journey of Free to Paid Services
4 Products companies traditionally offerservices bundled free e.g. IBM for
Mainframe, CISCO
5 Later companies took different positions.1 Partial cost recovery.2 Full cost recovery.3 Independent profit centre.4 Independent SBU.
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6 To change the free mindset is difficult.1 E.g. Google, Just Dial.2 Scaled down Version is offered free,
Standard Version at Affordable price
and Enhanced one at a Premium.
3 Practice of sending a Fee Invoice Building Solution Selling Capabilities Change Mindset, Responsibility for
Customers Outcome
1 Typical Product's companys focus starts &ends with Products e.g. Apple & Microsoft.
2 Solutions Company takes responsibility tochange the customer's outcome.
3 Example of Paint company for Automakers4 Wardrobe study by Shoppers Stop5 Practice patience Map the Entire Process1 Saves the company the hassle of
communicating with multiple suppliers.
Single Point contact.
2 Example1 IT implementation2 Tour operators3 Logistic Companies
Access Customers Total CostAcquisition cost
i. Pre Purchase Evaluation
ii. Price Negotiation
iii. Time spent & Paper work
iv. Delivery follow up
Develop Knowledge Bank1. Necessarily of KM within an organization.
i. When People leave, they take knowledge with
them.
ii. A large part of knowledge is not captured at all
2. IBM has a Portal Expertise Locator.
Transforming the Organizationfor Selling Solutions IGS
1. Solution Selling requires Customers Knowledge as
well as understanding Companys Capabilities.
2. IBM : Sales people had to face different
Customers every day Retail, Oil & Gas, Pharma
3. Selling to multinational customers acrossgeographies
4. Power game of Regional, Product heads. Cut thro
rigid processes.
Transition Process1 Difficult phase since both models -
Hierarchies & Team Play have to be managed
simultaneously.
2 Rigid Systems & Pockets of Power as well VSTeam Work.
3 Top Management challengeInitiative
Coaching
Compensation plans
Resource allocation.
1 Gerstner created 14 Industry Heads andgave them the charge.
2 Internal Transfer Price, Incentives andResource allocation all aligned to meet the
objective.
Transformational Leadership1. Gerstner realized that cost of doing business was
high.
2. External point of view to IBMs myopic culture.
3. Got strong outside heads to fight internal culture.
4. He appreciated the IBM Brand Value.
5. And finally, aligned Structure to the Strategy.
Building a Business that Works The turn-key revolution The Turn-Key Revolution
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1. The Turn-key revolution, similar to theIndustrial , Technology & Information
Revolution has changed the society
2. Transformation from Chaos to Order,Excitement & continuous Growth
3. The ultimate balanced model for businessthat works
The Franchise Phenomenon1. In 1952, Ray Kroc, a Milkshake machine sales
man saw a miracle at MacDonalds stand.
2. Hamburgers were produced1. Quickly2. Identically &3. Inexpensively
3. High school kids under supervision ofmanages
4. It was not a Hamburger making but a Moneymaking machine
5. He convinced them to allow him to franchisetheir method and bought them over
Most Successful Small Business
1. In 40 years McDonalds has become $ 40Billion
2. 30,000 restaurants world wide, in 120countries, Serving 50 million people every
day
3. It is the largest Prepared food distributionsystem in the World
4. Represents 10 % of the gross restaurantrevenue of America
5. More profitable than almost any other retailbusiness in the world with 17% pre-tax profit
Franchise Business1. McDonalds has created a model, on which
entire generation of entrepreneurs have built
fortune
2. In 2000 there were 3,20,000 franchisebusiness, in 85 industries with 1 Trillion in
sales
3. Accounts for 50 % of every retail Dollars inUS
4. Largest employer of high school kids in US5. Only 20 % of Franchise failed in the first year
of their operation as against 80 % start ups.
Business Format Franchise1. Earlier format was Trade Name Franchises2. Success of the business runs on the success
of the product it sales e.g. Mercedes & Coca
Cola
3. The Brand is difficult to create and sustain4. Business format Franchises provides the
franchisees with entire system of doing
business
5. True product of business is the business itself6. At MacDonalds, Hamburger is not the
product, McDonald's is.
Selling the Business instead of the Product1. Ray Kroc had a Huge dream but little money2. He began to look at his company as a
product and the franchisee as a customer
3. The franchisee was not interested in aHamburger but in the Business - does it
work?
4. He was not competing with other Hamburgerbusiness, but every other Business
opportunity around the world
Creating a business that would work oncesold
1. No matter who bought it.2. Forced to create a full proof predictable
business
3. System dependent and not Peopledependent
4. A business that would run without the owner5. Ray Kroc went on to work on his business notin it6. Pre production Prototype of a mass product
able business
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7. Each unit worked exactly like the first onelike model T
8. Turn Key Revolution was now like IndustrialRevolution
The Franchise Prototype1. The Franchisor, Prototype becomes model of
the dream - Nursery for all creative thoughts.
2. Prototype acts as a buffer before puttingideas to the real world
3. French fries are left in the worming bin for 7minutes. Thickness of the Patty is not to be
compromised
4. Discipline, Standardization & Order are thewatch words
Turn- Key1. Each franchisee has to attend the Hamburger
University - not to learn how to make
Hamburgers but to run the system which
makes Hamburgers
2. The franchisee is licensed to use the systemand Turn the Keys. The business does the
rest
3. This works at the1. Disney World & Federal Express2. Subway Sandwiches, KFC & Dominos
Works for all 31. For the Entrepreneur, the Franchise
prototype brings its vision to reality
2.
To the Manager, it provides order, systemand predictability
3. To the Technician, it gives him clarity to workuninterrupted
4. For the Business person, it gives a balance forall his 3 personalities
Working On Your Business(Not In It)
1. Your Business is not Your Life. They aretwo different things
2. The primary aim of your business is to serveyour life and not the other way round
3. Assume, the business that you create willbecome a Prototype of 5000 more like it
4. 6 Rules that will make you to win 6 Rules for working on the Business1 Model provides consistent Value beyond the
wildest expectations of all the stake holders
2 Operated by people with lowest possibleskills
3 The Model will stand out as a place ofimplacable order
4 All work in the model will be documented inan operations manual
5 It will provide uniform service to theCustomers
6 The model will provide a uniform color, dressand facilities code
1. The Model will provide a Consistent Value
1. Value is what people perceive it to be,nothing less nothing more.
2. Does the Prototype provide value thatexceeds their wildest expectations for allstake holders?
3. Value is the word you speak to the customerwhen you lose a big order
4. Help, you offer the customer when he isstuck
5. Pat on back on new employee doing a goodjob
6. Simple Thank You to your Banker for hisconsideration
7. Infosys is great Example of a Value Provider
2. Operated by People with lowest Possible
level of Skills
1. If your model depends on highly skilledpeople, it is going to be impossible to
replicate
2. You do not need brilliant attorneys, but verybest system through which to leverage
results
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3. Provide results Systematically rather thanPersonally - System dependent rather than
Person dependent
4. System dependent not Expert dependent5. Great businesses are built not by
Extraordinary people but by Ordinary
people doing Extraordinary things
Lowest Possible Level of Skills6. People are important. They bring life to
System
7. Entrepreneur's job is to develop those toolsand teach the people how to use them
8. If the Entrepreneurs gets outstandingpeople, it makes his job easier. Management
by Abdication
9. Results then depend on their mood10.With ordinary people, you will have to find
ways to make it extraordinary
11.You will be forced to do the work of businessdevelopment
3. The Model will stand out as a place ofImplacable Order
1. The whole world is in a chaos War, Famine,Inflation, Crime, Violence, Corruption
2. People want life Structure, Point ofReference in this disorderly world
3. Structures provide the fixed points ofreference in this otherwise disorderly world
4. Softcell Inside Account Manager, LargeAccount Manager, Technical Team
OrderAlvin Toffler in his book Third Wave writes,
Most people surviving the world around
them, only see chaos. They suffer a sense of
personal powerlessness & pointlessness. Individuals
need life structures. The absence of structure breads
breakdowns. Structures provides the much needed
fixed points of references.
4. All the rules will be Documented1. This is how we do it here
2. Without documentation all routine workturns into exceptions
3. There is a logic to the work that every onehas to follow
4. Operations manual e.g. Call centers,Microsoft Service Centre
5. Operating manuals e.g. manual for Car,Mobile etc. 5. Offer Uniform Predictability Service to the
Customer
1. Hair Dresser who gave a delightfulexperience and took it away
2. Unlike the Burnt Child, customer has achoice
3. Consistency1. Maruti Service Centre2. Airtel Service3. Jet Airways
4. What you do with your model is not nearlyas important as doing what you do, in the
same way each and every time
6. Provide uniform Color and Shape1. Different consumer groups respond
differently by specific Color & Shape
2. Color Code needs to be scientificallydesigned e.g. Dress
3. Logo on your Invoices, Visiting cards, Letterheads, Vehicles, Advertisements
4. Facility Code Flooring, Sealing, Walls,Furniture e.g. Titan Shops, HDFC Bank, CCD.
Work on your Business rather then in IT ?1. How do we Provide Value to everyone?2. How can I get business to work without me?3. How can I Systematize my business so that
5000th
unit runs as smoothly as my 1st
one?
4. How can I own/develop my business and stillbe free of it?
5. How can I spend my time doing what I loveto do rather than what I have to do?
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Systems Run this Place A Cup of Coffee, A News Paper and An Alarm Get to know meeting The Bicycle Experience Check list for Room service
Room cleaning takes 15 minutes Flat A new employee can do it
The Dining Experience Coupons System No Tip
Use of technology to the maximum Swipe Card Sensors
Predictable Results for the Guests
Michael Dell an Entrepreneur At Early Stages1 There is a direct relationship between
making mistakes and learning
2 Lesson of Delegation3 Good people like to work with other good
people
4 Early stage recourse constraints1 Small Cubicle2 Every one chips in to answer phone3 Sales people support by putting chips
5 Culture of being special and can do attitude Advantage to Direct Model Other Companies1 Guess ,what you think the customers want2 Speculate popular configurations3 Had to maintain high level of inventory
4 Two separate sales forces5 Learn multiple products Direct Model1 Provide what customers really want2 Build to specific customers order3 No inventory, sparing space and blocking of
capital
4 Sales people focused5 Focused on customer needs Barriers to Direct model & Differentiators1 Trust a new brand ?
Ans: 30 days buy back warranty
1 QualityAns: Close relationship with suppliers and training
1 PerformanceAns: IBM Compatible PC (8 Mtz to 12 Mtz)
Participating in COMDEX
Direct from Dell Engaging the entire company from
Manufacturing to Engineering to Sales to
support staff in the process of
understanding customer requirements,
became the constant focus of management
energy, training and employee education.
We learned the importance of ignoringconventional wisdom and doing things our
way.
Our competition didnt consider us a threatfor a long time, providing us with even a
greater opportunity to surprise them with
our success.
Mistake No: 1 Too Much Inventory In 1989 Dell bought huge stock of 286K chips Caught Crossing the Signal ,Technologically They were suddenly stuck with too many
Chips which no one wanted
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Value of material or information declinessuddenly Computers, Airline, Fashion to
Broadcasting
Huge Impact Had to sell stock at a loss Share price went down Future plans had to be shelved
Lessons from Inventory goof upImproving the speed of inventory flow is not only a
winning strategy, but a necessarily. It not only
combats the rapid decline of value of materials, but
requires less cash and less risk. We also made a
greater commitment to understanding and utilizing
forecasting.
2 : Ignoring Customers Feedback Dell planned to launch boil the ocean family
of products code named Olympic
It proved to have terrific products ahead ofwhat the customers wanted
Dell did not want to believe what they werehearing
Involve your customers early in thedevelopment process. They are your most
valuable focus group. Listen early and listen
well
Lesson : Technology for TechnologyCustomer
Dell learned the importance of gradualincremental impotents over big bang product
development
Reduced the risk Paced the investments Think like a mature company and not
a Start-Up
Embraced the philosophy ofBuy VS Make The engineers did not know, what customers
wanted
Dell encouraged engineers to get to knowwhat customers wanted & contributions to
business
Mistake 3: Going Direct In 1991-92 Dell was growing at a fast pace Corporate customers were narrowing their
choices. Also the development costs are
distributed widely
On a day-to-day basis you do not noticegrowth. Everything is going in slow motionwhile happening
Dell decided to go for the growth option &went Indirect through some of the large
Retail Chains
This was their third big mistake in a row Customers were dissatisfied, Dell dealt
directly
Learning the Hard Way It has been said that the strength, when used
to excess can become a weakness
In 1990, growth was the only thing Dell hadever known
Growth at certain point becomes yourgreatest venerability
The Correct Perspective Dell was $2 Billion with infrastructure of $50
Million
They had outgrown their phonesystem
Financial System Factory System Most important they had outgrown
people
If you build an infrastructure of $3 Billioncompany before reaching there, it will
eventually weigh you down so that you do
not reach there
You have got to have the confidence inyourself and the opportunity & you have got
to build the infrastructure as your grow
Finding the Footing Dell focused on growth ignoring everything
else.
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It was like driving a car looking at thespeedometer ignoring the fuel meter
First thing they did was to acknowledge theproblem instead of trying to explain it away
Dell need to focus on slow steady growthand liquidity, the profits will come
automatically
Instead of growth growth growth, newmantra was Liquidity, Profitability, Growth
in that order
Achieving balance Dell analyzed each and every segment and
came out with a P &L for each part of it
Each manager was set out for Cash & Profithunt
The managers responsibility wasperformance of their business. Clear cut
matrix was established
Sales could see margin while booking orderson phone
Compensation was linked with profits & cashflow
P&L for each unit as if independent business under promise & OVER DELIVER
Dell had to grow out of Start-up mentality in order
to figure out what to focus on. Instead of pushing
the accelerator towards greater growth, we had to
hit the breaks before we got too far ahead of
ourselves. We had to identify those opportunities
that made more of our strengths and go after only
the best ones, rather than trying to go after everyopportunity we saw. We had to pace our
investments to match our progress and hold
ourselves to a level of growth which would ensure
that we meet our commitments. This painful period
helped to reinforce the Dell philosophy of under
promise & over deliver.
Michael Dell Story Time Magazine named Michael Dell as a
Turnaround CEO of the year at the end of1993, a feast he says I will never will like
to have again in my life.
Someone once said that the differencebetween Dell & other companies is that
while all companies make mistakes Dell
never makes the same mistake twice.
Ground Rules for efficient Cash flowmanagement
1 Ensure that the Billing & Collection systemare monitored on a continuous basis
2 Billing to the customer is done Promptly3 Aggressive follow up on overdue payments4 Collecting advances from the customers5 Hold your payables as long as possible Focus on Collections1 Investigate new customers2 Supply only against formal purchase orders3 Get a PO Number for repeat orders4 Part Delivery, Part Payment option in the PO5 Do not link free Services with payment Collections6 Get repeated positive feedback from the
customer
7 Send invoice as soon as possible8 Contact before sending the Invoice9 Keep track of customers financial condition10 Statutory causes e.g. Sales tax, Octroi,
Delivery Charges
Strong Alliances with Suppliers
Define Your value Clearly
1 Pioneering companies had to createcomponents
2 Later on Specialized Components wereavailable
3 Contrarily to the traditional concept, Dell hadmore control
1 To Select the Best Supplier2 Divide the Risk over Multiple
Suppliers
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3 Dont get stuck with your OwnInvestments
4 This helped the company grow withoutlosing focus. Know when you can add Value
& when you cant
1 Complimentary Strengths for Success5 Find Partners with complimentary strengths& mutual drive for success6 Doesn't mean your job is done. Dont leave it
to chance.
1 Share your Goals & Qualityexpectations clearly
2 Explain them how the Direct modelhelps them
1 Customers shift from 17 to19 monitors
2 Lithium Power batteries - Sony7 In a way Dell has helped entire Industry to be
efficient
Keep your Relations Simple & Close By1 Dell had 140 suppliers of components and
growing
2 Todays rule is to keep it simple, have as lessPartners as possible. 140 to 20 suppliers
3 Follow the Sweet Spot Principle4 Complexity Kills, Proximity Pays5 Global Partners at 5 Centers Malaysia, China,
Texas, Brazil, Indonesia.
6 They asked their Local partners operateGlobally
Flip the Demand Supply Equation1 Traditionally shipments are made at
Warehouses where they were allowed to
ferment
2 Large shipments at quarter end, ChannelStuffing
3 Shipments every day to every hour, SteadySupply
4 Speed - Intel introduces new Chip, what ifyou are 1
st
5 Stop thinking how much inventor . Howquickly it moves
6 How Much to how Fast Never be Content on your Achievements1 Make information flow faster to reduce time
further - Inventory, Quality, Technology and
Requirements
2 Delivery of monitors directly by the logisticscompany by picking up 10,000 computers per
day & corresponding monitors
3 Wal-Mart, the Way to Go4 Feedback on Performance & Defects is
Instant & a Continuous process
Collaborate on R&D5 Investment in R&D has been a source of
pride in the IT Industry. $ 12 Billion is spent
on R&D
6 Dell is clear about when to invest and whento leverage & influence a partner
7 Criteria is general availability of technology.e.g. Development of Video Chip in 1990.
8 It is a decision about ROI as well as Focus
Strong Alliances with Suppliers Case Study of Dell Relationship1 Dell has strong alliances with
1 Customers2 Employees3 As well as its Suppliers
2 Strong Alliances helps in1 Speed of Delivery2 Deliver latest & best Technology3 Ensure highest Quality to its
Customers
3 Its all about Relationship and not abouttechnology
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Define Your value Clearly
1 Pioneering companies in the Industry had tocreate the components themselves
2 Later on Specialized Components wereavailable
3 Option to buy leveraging investments4 Contrarily to the traditional concept, Dell had
more control
1 To Select the Best Supplier2 Divide the Risk over Multiple
Suppliers
3 Dont get stuck with your OwnInvestments
5 This helped the company grow withoutlosing focus. Know when you can add Value
& when you cant.
1 Complimentary Strengths for Success6 Find Partners with complimentary strengths
& mutual drive for success
7 Doesn't mean your job is done. Dont leave itto chance.
1 Share your Goals & Qualityexpectations clearly
2 Explain them how the direct modelhelps them
1 Customers shift from 17 to19 monitors
2
Lithium Power batteries - Sony
8 In a way Dell has helped entire Industry to bemore efficient
Keep your Relations Simple & Close By1 Initially Dell had 140 suppliers of
components and growing
2 Todays rule is to keep it simple and have asless Partners as possible to 20 suppliers
3 Follow the Sweet Spot Principle4 Complexity Kills, Proximity Pays
5 Global Partners at 5 Centers Malaysia, China,Texas, Brazil, Indonesia.
6 They asked their Local partners operateGlobally
Replace the Bid Buy Process1 In most business models, Suppliers are cut
off from manufactures
2 In the Direct Model by Dell, it is about buyingto order
3 Advocate for the customer. To & froCommunication Inventory, Quality, Design,
Technology
4 Suppliers need to have Flexibility & SprintSpeed
1 Production Capacity2 How long for a new plant?3 How much of your Capacity are we
consuming?
4 How fast can you respond from 16to 18 monitor
5 Share 3 Year plan6 Clear Data Based Objectives
5 Dell - Our Toughest customers are our Bestcustomers
6 Suppliers Report Card Standards:1 Heights of Quality (Defects per
million)
2 Efficiency ( Delivery, Logistics, StockMovement)
3 Technology4 Embrace Internet5 Global Outlook6 360 % Evaluation
7 Helps the suppliers to improve their overallstandards
1 Flip the Demand Supply Equation8 Speed - Intel introduces new Chip, what if
you are 1st
to use
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9 Stop thinking how much inventor . Howquickly it moves
10 How Much to how Fast11 Shift from Supply Demand process to
Demand Supply
12 Traditionally shipments are made at theWare houses where they were allowed toferment
13 Large shipments at quarter end, ChannelStuffing
14 Shipments every day to every hour, SteadySupply
Never be Content on your Achievements1 Make information flow faster to reduce time
further - Inventory, Quality, Technology and
Requirements
2 Suppliers are close to the plant. Made toorder takes 4 days flat
3 Delivery of monitors directly by the logisticscompany by picking up 10,000 computers per
day & corresponding monitors
4 Wal-Mart, the Way to Go5 Feedback on Performance & Defects is
Instant & Continuous process
1 Office Environment2 College Tests3 Collaborate on R&D
6 Investment in R&D has been a source ofpride in the IT Industry. $ 12 Billion is spenton R&D
7 Dell is clear about when to invest and whento leverage & influence a partner
8 Criteria is general availability of technology.e.g. Development of Video Chip in 1990.
9 It is a decision about ROI as well as Focus Improve the Customers Working
Environment
1 Most of the R&D is on Software, to improveworking environment, not in the Lab or
factory
2 Diverse Customers have different languages,peripherals and needs customs set-up. Dell
convinced Microsoft to include software
code
3 Software Distribution Mirroring4 Dell Collaborated with Rank Mounting
Company to offer them the miniature
technology
5 The Design team shares the same designdatabase and collaborate in different time
zones
Dells Suppler Philosophy Communicate directly with your customer,
the decision maker. Talk directly with
suppliers. Dont treat them behind the scene.
Your competitive edge depends on howquickly your suppliers can provide you what
you sell to your customers.
Think real time when you communicate withsuppliers. A little too late is just too late in
todays businesses.
Your R&D must do real value add to thecustomer or it is wasted time and money.
RiverdaleOur Mission is to give you Out of the World Vision
The Cutting Edge Team
Rajesh Joshi : Expert in Second Home marketing
projects
Mahesh Kathri: Successful Builder and provider of
Seed Capital
Smita Desai: Will bring financial discipline & raise
funds
Share Holding Pattern
Rajesh : 60 %
Mahesh : 30 %
Smita : 10 %
Mission
To Establish Riverdale as a leading &
trustworthy weekend home company, providing
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customers Exclusive Villas at Out of the World
locations with excellent Facilities
Objective of the Business Plan
Raise funds
Market the project
Understanding the business & issues
Executive Summery
Founding Team
Marketability of the Project
Key factor being the River Side Location
Project Concept
View on Finance
Risks involved
Present Status
The Company has been formed
Neral being the location of choice
Exclusive riverside 5 Acre Plot
45 Acres agriculture land available
Competition from few organized players & small
local players
Customers want to go out of the city buzz
Operations Plan
Acquire land from farmers
Getting a reliable strong contact
Financing
Complete the legal procedure
Construct Villas
Create Infrastructure & Facilities
Security & Maintenance
RESPONSIBILITES ARE FIXED
Market Demographics
Geographical Profile
Demographic Profile
Behavioral Profile
SWOT
Strengths
Relevant Experience
Location
Weaknesses
Finance
Unknown face
Opportunities
High growth & profits
Scope of expansion
Threats
Established Companies
New players
Recession
Competition
Few Trusted names
Small local players
Faciliites
Club House
Swimming Pool
Restaurant
Gym
Indoor Games
River Boating
Product Offerings & Pricing
Classic Villas:
2,500 SqFt, Plot area 5,000 Sqft
3 BHK, Fully furnished, AC, LCD, Swimming Pool
20 Classic Villas
Price: Rs. 75 Lacs, Free Club Membership
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Premium Villas
1,600 SqFt, Plot area 3,000 SqFt
2 BHK, Fully Furnished, AC, LCD, No Swimming Pool
50 Premium Villas
Price: Rs. 45 Lacs. Free Club Membership
NA Plots
No Construction
200 NA Plots
Rs. 10 Lacs
Advertising & Promotion
Weekend launch thro color ads in leading newspapers
Hoardings on Stations & Express High Way
Promoted thro company website
Facility for Site Visit
Call centre for follow up
Sales team on the site to close sale
Special discount of 10 % for early birds
Finance Plan
Initial amount of Rs. 15 Crores to give shape to the
project
Mahesh contributes Rs. 5 Crores seed capital
Balance Rs. 10 Crores raised by investors
Ongoing cash flow will be managed by sales of Villas
More details in the Excel
Financial Plan
Assumptions
Prices are averaged out
Cash Flow managed by ongoing sale
Cost of NA Plots is accounted for in total cost
Investors money to be returned appropriately
For Breakeven, expenses are fully accounted