Business biographies

I was invited to speak at the Bangalore Business Literature Festival 3.0 (http://bangalorebizlitfest.org) yesterday. I prepared some notes, but true to my style, spoke mostly impromptu. It was a great opportunity to meet with writers I read regularly, as well as a lot of aspiring writers. No, I am not a prolific business writer, in fact, I have not written a single business biography yet. I wondered why I was drafted in as a speaker in the session on business biographies and management education. The moderator of my panel, my colleague Prof. Ramya Ranganathan clarified – I was in because I write cases and use firm biographies in my teaching and consulting. So, I thought I would begin by distinguishing between biographies of firms and biographies of individuals. Consequently, it is important to clarify these three words – biography, history, and a case.

Biographies of people and firms

In a panel before mine, a question was asked (to which the panelists had no answer, and it was part of my preparation!): in writing a biography, how do we separate the founder from the firm (especially in the case of a startup)? As a significant part of my classroom conversations, I separate the two explicitly. When you write and analyse a set of events in the form of a chronology, it is very difficult to separate the person from the firm. If you want to chronicle a firm biography, it is important to slice the narrative across specific decisions. Say a diversification decision could be narrated as a specific chapter bringing in the environmental context, how it was perceived by the leaders, how and what strategic change was initated, what were the implications of the change on the internal and external contexts, and if and when it achieved its intended purpose.

This way, writers can separate a firm biography from an individual biography, and highlight the idea that firms outlive (and outperform) people. As a strategy teacher, it is important for me and my class to focus on the firm independent of the strategist. And this distinction is critical to learning and application.

Biography, History, and Case

As a case writer (I want to believe that I have been prolific), I am continuously confronted with this distinction. And when I teach/ mentor colleagues on writing cases, I make sure I tell them that they are not writing a biography or history! So, it important to articulate the differences.

The purpose of a historical narrative is to recreate the context in the minds of the reader and inspire. Some exaggeration is acceptable; some glorification of the protagonist is expected; and therefore, triangulation of methods and validation of data are not that critical (though good history is based on well organized and validated data). The purpose is to present the reader with a interpretive representation of the context. The example that came to my mind yesterday was that of the imagery of the Rani Laxmi Bai of Jhansi. The job of a historian is to recreate an image of the Rani in the minds of the reader with his narrative. Every one (in my audience) may have heard of her, and having read the narrative/ heard stories about her, the readers would form an image of her in their own minds. It is inconsequential if she was right or left-handed; if she had 12 guards of 16; or if she indeed wore a saree as depicted in the imagery. What is important is to highlight the paradoxes – a woman warrier in a society and time when no woman fought in the frontlines; a saree-clad horse-rider; a lady carrying both a baby slung on her back and a sword in her hand; and the like. Symbols of bravery and obstinence. Period.

On the other hand, a biographer is expected to carefully validate all data and record them diligently. She is expected to present all aspects of the personality – the good, the bad, and the not so expected facets; from multiple perspectives, without judgement. The biographer cannot exaggerate, should not glorify, and should present the facts as they are without any interpretation. It is for the readers to make sense and take specific learning. It could be anything; like when Prof. V Raghunathan spoke yesterday, he said he picked up the idea that a man can do more work by sleeping only four hours per day, when he read the biography of Napolean (who apparently slept for four hours on horse back). Maybe, when I read the same biography, I would pick up something else, and you something totally different. No representations here.

A case is a decision-focused narrative. The purpose of a case is to emphasize how learning about a context can help students and learners from applying it other contexts. My colleague Prof. Rakesh Godhwani narrated a story yesterday. It was about the great imposter, Dr. Joe (made famous by the movie of the name: Catch me if you can), on how as MBAs we need to “fake it till we make it”. A member of the audience wanted to know the ending – did he get rewarded for saving lives, or did he go to jail for impersonation? As a case writer and management teacher, I would say, the ending does not matter. What matters was the criteria to make the decision, not the actual decision. Therefore, good cases do not need to be neat and complete. Then are non-comprehensive accounts of events and antecedents leading to a decision.

Therefore, the historian would create an imagery of the Rani of Jhansi, the biographer would focus on her valor, while the case writer would discuss the context of why she was at all required to fight (in the context of British India’s Doctrine of Lapse).

Celebrating the also-rans

I called the audience to write about firms that were also-rans. Success has many fathers; and these days, even failures have enough parents. In fact, I was proud of the fact one of my first cases as an academic was about India’s first ecommerce firm (way back in the year 1999), Fabmart.com; and in one of the panels yesterday the co-founder of Fabmart.com, Mr. K Vaitheeswaran was speaking about how the firm failed subsequently and his coping with that failure (read about his book, Failing to Succeed, here).

However, there is little focus on the also-ran firms. Since a majority of our students are also-rans who make their careers in also-ran firms, it is important to study them. It is important to study how these firms perceive the environment, adapt/ adopt, make strategic shifts, learn/ unlearn, pivot, take feedback, measure impact and performance, and go round and round in circles! Developing, what we strategy researchers call, dynamic capabilities. These bios are extremely valuable for the management researcher.

So, the next time you hear about a firm that is neither a success or a failure, remember that there is a lot to learn in terms of processes, routines, and dynamic capabilities from them.

Cheers.

(c) 2017. R Srinivasan.

PS: Edited Prof. Rakesh Godhwani’s coordinates and the name of the movie he referred to (Catch me if you can) on 11 Sep 2017.

Changed the featured image: 21 Sep 2017.

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App-in-app?

I recently got an email from my airline app that I could book my car ride within the same app. It was a way of providing end-to-end services. Much like the home pickup and drop service provided for business class customers by the Emirates. What are the implications of these for the customer, the airline, and the cab-hailing firm? Let’s explore.

It is an app-redirect

First, read the terms of how it works in the case of Jet Airways and Uber here. The substantive part of the T&C is hidden in the paragraphs quoted below:

“PLEASE NOTE, YOU ARE MAKING THE PAYMENT TO UBER DIRECTLY. JET AIRWAYS IS NOT RESPONSIBLE / INVOLVED IN THIS FULFILMENT PROCESS. JET AIRWAYS WILL NOT BE LIABLE AND/OR RESPONSIBLE FOR REFUNDS, DELAYS, REJECTIONS, PAYMENT AND FULFILLMENT OR OTHERWISE OF THE SERVICES OR IN RESPECT OF ANY DISPUTES IN RELATION THERETO, IN ANY MANNER WHATSOEVER.” (emphasis original)

Then, what is the value of this app-in-app integration?

Customer perspective

For the customer, it has the potential to work as a seamless end-to-end service. I imagine a future, where you would find a partner using Tinder or TrulyMadly, plan your evening to a game/ movie using BookMyShow, find a restaurant & book your table using Zomato, and take Uber whenever you are ready to move on, or better still, have an Ola Rentals car waiting for you through the evening. All in one app. Wouldn’t you love it, if all of it were integrated in one App? Just imagine the convenience if your restaurant-finder knew that you are in a particular concert at a specific place and you are likely to head out for dinner at a particular time. This specific knowledge could immensely help your restaurant-finder app to customize the experience for you – for instance, it could not only provide you those restaurant options that are open late in the evening after the concert was over, in a location that is close to the venue; it could possibly alert the restaurant that you were arriving in 15 minutes, based on your Uber location. And through the evening, post your pictures on Instagram and SnapChat, check-in to all those locations in Facebook, and Tweet the experience live.

Yes, you would leave a perfect trail for the entire evening in a single place, and if you were to be involved in an investigation, it would be so easy for the officer to trace you! No need for Sherlock Holmes and Watson here – the integrator app would take care of all the snooping for you!

Convenience or scary? What are the safeguards related to such data sharing across different entities? How will the data be regulated?

The Integrator perspective

Why would a Jet Airways provide an Uber link inside its App? Surely cab-hailing and air travel are complementary services. Plus, Jet Airways believes that its customers would find it convenient to book an Uber ride from within the Jet Airways app, as they trust the app to provide Uber with all the relevant details – like the estimated landing/ boarding time of the flight, drop/ pickup addresses, etc. Jet Airways also needs to believe that its customers would rather choose an Uber cab, rather than its competitor OLA Cabs, or any other airport taxi service. The brands should have compatible positioning. Given that Jet Airways is a full service carrier, and differentiates based on its service quality, Uber might be a good fit. But the same might not hold good for a low-cost/ regional carrier like TruJet connecting cities like Tirupati, where Uber does not operate.

Does integrating complementary services affect customer satisfaction, brand loyalty, customer switching costs, and/or multi-homing costs? In contexts where these services and brands are compatible, and there is a convenience involved in sharing of data between these services, there is likely to be some value added. Like airlines and hotels (hotels would like to know your travel schedule); currency exchanges and international travel (the currency exchange would love to know which countries you are visiting); or international mobile services. If there was no data to be shared between the complementary services, the user would rather have them unbundled. Think travel and stock brokerage.

That said, platforms find innovative complementarities. For instance, airlines (primarily the full-service carriers) have launched co-branded credit cards. In a recent visit to Chennai, there were more American Express staff at the Jet Airways lounge than the airline or lounge staff! And they were obviously signing up customers. What are the complementarities between credit cards and air travel, apart from paying from that card? A lot of business travellers have their business travel desks do the payments; consultants have their clients booking the tickets; and even for individuals and entrepreneurs, the credit card market is so fragmented that everyone holds multiple cards. And the payment gateways accept all possible payment options, including “paying cash at the airport counter”. They why co-brand credit cards – sharing of reward points/ airline miles. Either customers do not earn sufficient airline miles and using these co-branded credit cards help them earn more miles and retain/ upgrade their airline status (remember the 2009 movie, Up in the Air?); or they do not earn enough reward points in using their credit cards that they can redeem their airline miles as credit card reward points. Either ways, each one is covering up for the other.

In this covering up, or more diplomatically consolidation of rewards, the partners increase customer switching and multi-homing costs. Surely, redeemable airline miles might be more valuable to a frequent traveller than credit card reward points that have limited redemption/ cash back opportunities. But for loyalty to increase, it is imperative that both brands stand on their own – providing compatible services.

Mother of all apps

All this looks futuristic to you? A lot of you have been using an ubiquitous desktop app known as the browser for a long time, which has been doing exactly this! In a subtle form, though. However, there are firms that own multiple such apps, and they use a single sign-on – like all of Google services. Plus, even third-party sites like Quora allow for using your Google credentials to sign-in. The trade-offs are not always explicitly specified – it is always the case of caveat emptor – consumer beware.

Quora homepage

So, the next time you experience some cross-marketing across platforms/ apps, think what data might be shared across both the apps; and if you would really value the integration.

Cheers!

(c) 2017. R Srinivasan

 

Free … continue hoyenga?

Well, writing here after a really long time. Finished teaching three courses, two mentoring assignments, and two cycles of a customised executive education programme for a client in the interim. A bad throat induced rest (well-deserved, that’s what I would like to believe for myself) gets me to write this short post.

Let them eat FREE

The title is inspired by the advertising tagline of India’s latest entry into the already crowded (dozens of competitors) in a highly penetrated market, Relinace Jio (see here).

Today morning’s story from Rohin Dharmakumar at The Ken is titled Let them eat free! His basic argument is that as regulators and governments are discouraging service and convenience fees, consumers are getting used to free services; which will eventually kill the free markets by taking away the pricing power of enterprises (especially in a highly competitive market).

Over the past few years, I have been studying platform business firms where one of the first concepts one learns in multi-sided platforms is that at least one of the sides of the platform (either the demand side or the supply side) needs to be subsidised to leverage network effects (or mobilise the network from scratch). Is subsidy therefore any different from free? I would say no. There are free lunches, for at least some people in a business. The business may therefore decided to charge someone else for giving these free lunches.

Think free food in temples and gurdwaras… prasads or langars. In fact the mess food at most military establishments in India is called a langar. In a society where there are a lot of people struggling to earn two meals a day, a free lunch provider was a celebrity. The village elder, the temple management, the birthday girl, or just about a casual visitor. Oh, this is religion and philanthropy, you argue. Business is different. Business is for-profit.

Subsidies

Businesses subsidise one side and make money from another side (think Internet search, where search is free, listing is free, and SEO/ Ad is paid); subsidise one product and make money from another product (think Gillette’s razors and blades, HP’s printers and cartridges); subsidise today and charge you tomorrow (think airline dynamic pricing); and/ or subsidise one segment of customers to charge from another segment (Aravind eye hospitals, Robin Hood). Remember, Skype is free (well almost); this WordPress blog is hosted on a free plan; so does your email (well almost all of it).

Is subsidy bad? No, as long as the “customer” who receives the subsidy knows where it comes from. If the business model is clear, and the subsidy receiver knows that she is receiving the “free lunch” because someone values giving it to her for free, it should not be a problem.

Subsidy is bad when someone receives a subsidy in return for particularly nothing. It is inefficient for the entire market when the customers do not know where the free is coming from, what the firm is going to do with all those intangibles (information about me, my behaviour, my preferences, and my network) I provided with them when I signed up.

Government subsidies

What happens when the government gives you something for free? Like the social security? Do you know why it is free? And how is it financed? In countries like India, the annual presentation of the government book of accounts is a celebrated ritual. See the official website here, and the Bloomberg “live” reporting here.

For long, successive governments in the Indian state of Tamil Nadu have been providing freebies to the citizens both as an electoral gift as well as a welfare measure. Most of these have been funded by the state monopoly liquor retail shops, the TASMAC (read here). But when these shops close/ scale down, the state government has to find new sources of funds and/ or scale down welfare spends.

Enjoy it till it lasts

A lot of my friends enjoy these subsidies (for instance a discount from ecommerce companies) knowing very well that the provider is giving it to them from their investors’ wallet. Like the Reliance Jio offer, like the cheap OLA ride to the Bangalore airport, or just the discounted products on the Flipkart’s sale day! They say, enjoy it till it lasts! The assumption is that they would attrition out when the prices rise, or the firms begin charging for whatever was hitherto free. Don’t the firms know this … they are trying to build and leverage multi-homing costs for your products/ services.

Be aware

I would therefore say, be aware; enjoy it till it lasts; use it as a trial; choose whether you want to multi-home and retain the flexibility to signout, and have fun.

Cheers.

(C) 2017. R Srinivasan.