Archive for category General Topics

The demise of a retail giant

I happened to walk into the clothing dept. a Sears dept store last week; something I have not done in a loooong time. I went there to buy some sweats for my dad. I usually go to Sears to buy tools- their Craftsman tools are still one the best with a very good warranty and I love their tools department. However, I have not been to any of the other departments for a while because one would not want to be caught buying clothes from Sears. This is a paradigm shift from the Sears of yore- when it was the premier brand in the US. The Sears catalog was a sought after item and consumers waited for the thick book with thousands of interesting items; it was especially popular during Christmas, when kids were allowed to select an item or two from the catalog as their gift. The Sears brand was prestigious both for shopping and employment; working in their stores was a sought after job and many a family made a good living working at Sears. Even as far back as 1989-90 (which is as far as my history in the US goes), the Sears brand was strong – they sold Whitewall tyres, Craftman tools, Kenmore appliances, and an assortment of clothes.

Over the years, Sears seemed to lose its way; they were not sure if they were a department store, a specialty store, a hardware store, or an appliance store. As they tried to find their way, newer stores specializing in each of these categories started eating away at their market share. And then came the internet and online stores like Amazon, which were able to offer better prices and more important better service.

The Sears I visited last week seemed tired, and trudging along without a sense or purpose. The people working there seemed listless as well. The demographics of shoppers has changed as well. No more is Sears a store where the middle class want to shop or even be seen at. Interestingly, the demographics of the sales people seems to have changed as well- perhaps to match the demographics of the shoppers.

As I wandered through the store, I saw all the signs of a store that does not care – the artificial brick facade wall paper on the pillars, the lack of interest of the sales people to help you, the lack of foot traffic on a Sunday….. all signs of a store that has lost its way.

I started remembering the other icons of America – Pan American Airlines, TWA Airlines, Woolworths, Montgomery Ward Dept Store, Emporium Dept Store, Circuit City, CompUsa, Linen’NThings, Osco Drugs, Gateway Computers, Levitz Furniture, and more recently Radio Shack- all of which are no more or on their way out.

I remembered what I had learnt in my marketing class from my MBA program from over 20 years ago- companies need to identify the what business they are in and continuously innovate to ensure they stay relevant to their area of focus and competitive to their customers. The company making kerosine lanterns did not recognize until it was too late that they were in the business providing light – and when the electric light bulb was invented and became commercialized, found itself irrelevant to the customer and closed shop.

Old brick-and-mortar stores find it even more challenging to stay relevant in the world of social networking, and the new generation of shoppers who both interact and shop in a whole new way. It is therefore imperative for them to relate to the new generation and continiously reinvent themselves if they want to succeed or even survive.

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Vishal Sikka News

One of the articles I read mentioned that Vishal Sikka may be headed to Infosys as their CEO. Would be interesting to see if this happens. Here are my thoughts on that:

1. SAP is a software company and Vishal was key in spearheading their product development making strategic decisions on technology roadmaps and directions- Infy is still more known for its consulting business, and even though they have been involved in some SW development, it is not yet their bread-and-butter.

2. SAP is a global company with most of the action in the US and Germany – Infy is still very much anchored in India – the culture and pace there is still very different

If the rumors that Vishal left SAP because he was not happy with the lack of speed (or the powers that be in Germany were not happy with his aggressive approach), this is a challenge he will probably face @ Infosys as well.

Having said all this, it would be a great boost for Infosys to have someone like a Vishal Sikka lead the organization. He is a visionary, and he will probably forge Infosys into new and unchartered territories.

We will have to wait and see…..

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Vishal Sikka resigns from SAP

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Have been very busy and not had time to post any new blogs, but had to write a blog about Vishal Sikka leaving SAP. This IMHO is truly a blow. Vishal was a truly visionary and innovative leader who seemed to be leading SAP out of their old ways into the new world with new and emerging technologies.

Of the many articles I read since I heard the news, these lines from an article resonated the most:

“Given that SAP’s executive bench is now filled with sales and marketing talent and fewer technical folks who understand how core technology can transform SAP, this puts pressure to find a new visionary that can interpret Chairman Hasso Plattner’s visions while balancing the market’s need for 30 to 40% year over year growth.”

(Article by R. Ray Wang. http://www.enterpriseirregulars.com/74396/news-analysis-saps-cto-vishal-sikka-resigns-mean-sap-customers/).

Of late a few senior visionaries have left SAP; first Sanjay Poonen, and now Vishal.

I was looking forward to Vishal’s keynote @ Sapphire. Would be interesting to see where he resurfaces.

 

 

 

 

 

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Email – Does it do more bad than good?

 

I got yet another reminder from Outlook today that my email box was full and I need to clean-up my old emails. Which got me thinking…..

Many years back, I worked for a CFO, who was probably one of the best when it came to emails; his response to emails were very selective, and to the point; most of his emails were short, like, ‘yes’, ‘no’, and when it came to anything controversial, or needed explanation, it would read ‘call me’. He was one of the smartest and most politically savvy person I worked for, and not surprisingly, he has done very well for himself.

Which brings me to the topic of email and whether it does more bad than good. Emails tend to fly around an organization like a unguided missile, causing destruction, getting bigger and bigger with comments being added as they go around, forwarded, replied, and re-forwarded. Most of the times, emails do not convey your message very accurately anyway- because written (and sometimes even spoken) words are subject to interpretation by the reader- and unless you are there to clarify what they mean, the reader(s) is going to take whatever message they interpret- leading to even more confusion.

Then there are individuals who have this irresistible urge to respond to every email they get (or are copied on); they want to be the first to respond to all and every emails, irrespective of whether their response has any real value or content.

And, the most annoying, there are those who hit ‘reply all’ (yes, I too have been guilty of these..). Especially irritable are the ones who hit reply all to mass or general emails like farewells, announcements, etc. I really don’t care that you think the newborn has great blue eyes, because my eyes are getting bleary having to read all these emails.

People tend to be more aggressive and indiscreet in the virtual world than in person- so aggressions in emails tend to escalate fast and soon it becomes a virtual fist-fight; even worse, it is now on record and can and will be used against you @ the most inappropriate moment. When emails were limited to laptops and desktops, you had the time to think before responding to emails. With the capability of writing and responding to emails from everywhere with your hand-held, it has become even more reactionary and incendiary – many are the cryptic email arguments that have started from a hand-held device.

Worse, emails written by you could be used by the recipient inappropriately or inaccurately; suddenly you are in the middle of a controversy that you never intended to start and you do not find out about it until you get your own email back @ the bottom of a hundred responses from various individuals….. it is like a bomb getting bigger and bigger as it flies around the organization, gathering size and intensity.

Hence my blog that emails tend to cause more bad than good…..

Going back to my CFO, after I sent out an accusatory email that was soon flying around causing destruction, he called me into his office and gently told me, ‘maybe you should think the effect of your emails before sending them’. While not always successful, I sometimes write an email, re-read it, and even as my fingers are itching to hit the ‘send’ button, I hit the ‘delete’ button instead.

If I ever have a company of my own (chances of which are slim, since I am spending all my time writing these blogs), here are some rules (and technologies) I would impose:

  • Responding ‘reply all’ to generic emails is an automatic 1000 fine (yes, this is big- like a solo driver using the carpool lane)
  • You are limited to sending no more than 20 emails a day – similar to the # of red flags a coach can throw in the NFL – you save your emails for the real ones
  • To send an email, you have to press 3 keys simultaneously (or you have to access the send button via a complex menu – Microsoft, are you listening…)
  • Email responses (via all devices) have an automatic wait period before they get send – similar to the delay they build into broadcasting, to edit inappropriate language- so the sender has a chance to cancel the send

And now to off to go read the 100 or so emails I probably received while I was writing this blog…….

 

 

 

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Priceline… what are they doing right?

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I was looking @ some stock prices in Google finance and noticed this anomaly in travel agency stock prices; while PCLN is @ around $1200, the rest of them are all under $1oo, some of them single digits. Some of this could be explained by their 1 to 6 reverse stock split, but that cannot explain the price of $1200. Market cap for PCLN is $62B- that is a big # for a travel company. Any explanation on what they are doing right?

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The need for operational excellence (and subsequently, a Chief Operating Officer)

Small companies and start-ups often get off to a good start because of good product(s) combined with good marketing. As the company grows, it hires more sales people and product developers, one to increase demand and penetration, and the other to ensure adequate supply.

An area often overlooked or sub optimized is the operations; the company gets so caught up in increasing its revenues that it loses focus on the operational aspects of the business. Even if there is some focus on operations, the right person is not assigned to manage this area. And here is my theory behind it….

Companies are started by sales people and/or engineers- and their focus is in selling or product engineering. When the company is small with a small list of customers, it is easy to manage the supply/demand situation as well as the underlying operations. However, as the company grows and increases its customer base and potentially the complexity of their requirements, the need for focus on the operational aspects of the biz becomes critical.

While the sales people are out there promising the world to the customer (and prospects), and engineers are busy with product design and features, it is the head of operations, who ensures there is enough supply for the demand being created, and the output meets the desired quality. The head of operations also works with the head of finance to ensure there is enough working capital to keep the shop floor running. He/she also advises the sales people when to turn down an order because of lack of adequate capacity- a skill a sales person is not trained to do, and the engineers what feature(s) is going to be difficult to build and scale – a discipline the engineer does not usually have (since they are too enamored by the features of their product – read the biography on Steve Jobs, you will know what I am talking about).

The head of operations (or chief operating officer) plays in important role in developing and constantly improving the operational excellence of the organization, using data and KPIs; they have to be good @ forecasting, identifying vendor risks, personnel needs and challenges, and the optimal use of all types of resources. Amidst the chaos and ad-hoc nature typical of a company in its infancy, the COO also brings in much needed processes,  discipline, and structure which is often lacking. They are disciplined in their thought process, and tend to be less carried away by unrealistic expectations, and promises, typical of sales people.

Companies that do not recognize the need for the COO, often find that they have overcommitted to their customers (a sales focused issue), have quality issues, and are unable to meet commitments and deadlines. In addition, while they may be profitable @ a unit level, their bottom-line is suffering because of over-capacity, excess inventory, and sub-optimal operational efficiency. Worse, they may be losing repeat customers because of a lack of consistency in the quality and standard of the deliverables.

A good chief operating officer is priceless for an organization of any size and in any industry and has a seat in the table with the CEO. The COO, allows the CEO to focus on strategic areas and in growing the business without worrying about the availability of the right item for the right customer with the best possible quality.

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Beware of the inspirational manager/supervisor/leader without substance

Many of us have @ one time or the other, come across inspirational leaders, in the form of a supervisor, team lead, or self-appointed leader. They motivate you to follow certain paths or go do things that seem counter-intuitive; their approach goes against everything you believe in or know is right; and yet, you follow their directive (or direction, depending on whether it is a supervisor or not). It is easy to come under their spell- they are strong, have conviction, and seem to have it all figured out. Beware….. and wake up and smell the coffee.

Validate their directive against actual facts and data, especially if the individual has little to no experience in the space. Lack of experience or knowledge does not stop these ‘leaders’ from trying to force their convictions on others- because, by their very nature, they are forceful and are often, sorry to say, so full of themselves, not in touch with reality. For them, their ‘leadership’ quality justifies everything.

Don’t get me wrong – there are examples of great motivational leaders- like Gandhi, MLK, JFK, Steve Jobs; these leaders had substance and in most cases based their convictions on certain facts and data. Steve Jobs did not try and give guidance on how the economy should be run; he focused in his area of expertise. He pushed his people to their max and helped them achieve their potential (though his means may be questioned by many!).

Inspirational leaders without substance and the right background can be downright dangerous for those they are leading and for the cause itself; they take diametrically opposite positions often just to prove their leadership – the only purpose for these positions is to show their leadership and provide them an opportunity to shine- it is all about them.

Such leaders are however fickle; when things start going wrong, they will be first ones to bail on you, leaving you standing lone with ‘your cause’ and ‘your position’. They have already found something else that looks more attractive and will give them a chance to get on the pedestal.

A good leader is not about himself or herself; they are focused on the success of the cause and do not want any attention to themselves. They base their guidance on recommendations on facts and good data; they ensure the team and the cause comes first and when things start going wrong, are the first to step up and take blame. They are people oriented and focus on the betterment of their team.

What has your experience been?

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