Strategically Yours
Transcript of Strategically Yours
About Subroto Bagchi
Subroto Bagchi is a co-founder of MindTree Ltd., an
international IT consulting company. In April 2008, he was
redesignated as the "gardener" and in this role he will "repot,
fertilize and (...) weed and clip the human resources. He is
the author of the books, Go kiss the World- Life lessons for
the young professional .The High Performance Entrepreneur
and The Professional.
Acknowledgement
The contents of this PowerPoint are based on
article titled “ Strategically Yours’ of
Mr.Subroto Bagchi which appeared in his blog
.
This is my own interpretation of his article
&
easy understanding .
Words of Subroto Bagchi During the last few weeks, I had the opportunity to sit-in with two leadership
groups, one from Mind Tree and the other from a leading organization in the
hospitality sector. Each group was huddling to discuss their “Strategy” for the next
year. While listening to them, I realized what the two teams were discussing, was
Plan and not Strategy.
They were looking at the current year‟s performance as a base and then building
plans to achieve better than industry growth in top-line, customer satisfaction, and
employee satisfaction and so on. Both the groups had thought through how they
would go about their purpose at an abstract level. The two groups did need to
discuss their plans on hand which was critical from an operational perspective; but
they also needed “Strategy” without which any organization‟s relevance would be
in question sooner than later. Thus, on one hand what they really needed was a
strategy which they did not have; on the other hand, they were using the term
without knowing its true import.
I am sure many amongst us have the same issue; hence this is dedicated to
the meaning and characteristics of strategy.
Strategy The word strategy comes from the Greek
word strategia, office of a general: linked to
Strategos and means:
The science & art of using all the forces
of a nation to execute approved plans
as effectively as possible during peace
or war;
The science & art of military command
as applied to the overall planning &
conduct of large-scale combat
operations
A plan of action resulting from strategy or intended to accomplish a specific
goal
The art or skill of using stratagems in endeavors such as politics and
business
(Source: The American Heritage Dictionary of the English Language)
Strategy
What the dictionary really suggests is that
strategy is a matter of leadership priority.
It must engage leaders.
It is something that is “game-changing” in
nature.
It is part science and part art. It is about
“large scale” impact.
Much the same way, someone has 25% attrition among employees and wants to
reduce it to 20% the next year, all we need is efficiency. But the moment we want
to contain attrition to halve it, we would need a strategy and we would need to
make strategic choices.
Reasonable growth of business over what we have this year, doesn‟t really need a
strategy for it; what is required is efficiency.
It is not about the data, Stupid !
It is not about the data, Stupid !
Game-changing personal decisions
(remember, strategy is about game
changing stuff) are rarely really borne
out of data.
What is game-changing?
When something you choose to do, irretrievably changes the
subsequent five, ten, twenty steps of your life in a big way, it is
game-changing.
Because you studied law over medicine, you ended up becoming a
lawyer for the rest of your life. It became your profession. But it also
determined where you would spend your wakeful hours, who you
work with, who pays for your services and so on.
Similarly, who you chose to marry had huge downstream
implications; it settled the pattern of your joys and your grief, it
settled who your relatives and your enemies would be.
It is not about the data, Stupid ! What is game-changing? ( Contd..)
When you decide to have a baby, it was similarly a game-
changing decision because it changes practically
everything downstream
From your sleep pattern,
To the choice of a job to one of the two of you actually
putting career on the backburner,
To renting a bigger house
To moving to a savings plan such that one day your
child may get better education than what you had.
If people were to write a business plan before they are
to have a baby, I suspect, there would be no babies.
Data is critical but swimming in it, does not get you strategy.
Data is about the past & future data is an oxymoron. It is a projection and sometimes, a prayer.
No data on past usage would have given Mr.Gopinath the confidence to get into the helicopter
business.
No data told Kiran to get into the enzyme business or to leave it.
In the case of Siddhartha, data actually suggested that the idea of a coffee retail business was
unviable because coffee consumption was going down.
It is not about the data, Stupid ! Data. Analysis. Logic -These are about the left brain.
The right brain on the other hand, sees the inter-connected nature of things, the
big picture, the relationships.
Strategy is more about the big picture. Game changing decisions are matters of
strategy and they are seldom made because of “rational” and hence data driven,
logical reasons; most often they sprout from an emotional crevice. Just as game
changing decisions in the personal sphere are borne out of emotional reasons or
shall we say, non-rational reasons, the same is true in the workplace.
Mouthing spread sheets and spewing data does not make you strategic.
Microsoft, Google, Twitter, Facebook, Infosys and Tata Steel were not born out
of laborious study of analyst reports.
If the analyst can get it, they would not be writing the reports! You may seek
validation and comfort in analyst reports but the decision to start a memorable
enterprise is invariably in the gut.
The gut is not all intuition and no logic as some may think. As we are beginning
to understand how the gut works, people are telling us that the synaptic ends
actually go beyond the brain and what you think of as gut feel is actually your
brain.
You don‟t require a Strategy for
business as usual
You don‟t require strategy for business as usual
Infosys
In the year 2000, they had 5389 employees.
In 2003, that number was 15,356.
In 2007, the number was 80,501 and this year, it touched 128,000.
When a company wants to raise its headcount three times in three years as we saw
between 2000 and 2003, mere efficiency would not deliver.
The organization must do things very differently.
The interesting part in the example of Infosys is that the management at the top
remained the same between 2000 and 2011 but the very same set of leaders could
deal with the complexity of locating, hiring, training, retaining, shedding, rewarding
and recognizing three, ten, twenty times the original number!
Someone had anticipated the need, thought through the game(plan), socialized the
strategic choice among others and got the entire engine revving and the system
moving in a direction consistent with an invisible will.
The way Infosys spun the headcount is a great example of strategy at work.
You may or may not agree with what they do and how they do it, but there is
absolutely no question of doubting the presence of real strategy at work there
If what you are discussing sounds counter-
intuitive, you are probably about to take off
If what you are discussing sounds counter-intuitive, you
are probably about to take off.
In his book Simply Fly, Gopi beautifully narrates how he and his buddy Sam
decided to get into the helicopter business and Gopi says even today, he would
have never gone into it (the helicopter business) if he knew the price of a
helicopter! For the simple reason, he did not have that kind of money nor could
he raise it! So what did he do? He and his friend Sam went to Singapore and
negotiated with a helicopter owner to give them his copter on long-term
rental. The man agreed, Gopi and Sam flew it back to India. The rest is history.
The moment you shift your focus from owning something to operating it, buying
property to leasing it, retaining talent to rotating it, you are beginning to think
strategy and are more likely to make strategic choices that may be game
changing.
Captain Gorur Gopinath‟s (Gopi) entry into the
helicopter business & subsequently, the low-cost airline
business (and in time, exiting that business) is about
strategy and strategic choices.
Not required to giving up something?
Probably not looking at strategy
Not required to giving up something? Probably not
looking at strategy
Founder and Chairman Kiran Mazumdar Shaw would tell you that she started
the company when her Irish partner asked her to make enzymes out of papaya
and rice.
At one stage, Unilever bought a stake into her company as she had become a
very important supplier.
Then one day, she decided she was going to do other things. Insulin for
example. And things like contract research and so on. Her customer and
stakeholder Unilever did not like that one bit.
Sometimes the choices leaders make as an outcome
of a strategy conversation, do not require them to
give up anything.
Look at this advertisement from India‟s bio-tech
darling Biocon. It is an ad for selling enzymes;
fervently telling you that Biocon is the leader in the
enzyme business. Well, that is how the company
started.
Not required to giving up something? Probably not
looking at strategy
They lectured her about stuff like core competency and even threatened that
they would pull out if she did not stick to the enzyme business. What did she do?
She sold that business.
Unilever pulled out. But thanks to that decision, today, Biocon is synonymous
with oral insulin to cancer research.
Unless you physically vacate the space you are standing on, you cannot move to
someplace else.
You must let go to let come.
The decision to vacate the enzyme space and the act of vacating it are matters
of strategy and strategic choices.
If what you and I are obsessed with right now does not require giving up
something substantive, we are probably also not getting into something
substantively different either. Scale and strategy are twins.
Strategy loves adjacency
Strategy loves adjacency
Cafe Coffee Days are clean, friendly, affordable, air-conditioned & safe.
It is a place where a boy and a girl can spend some time together in a
pleasant atmosphere and they are willing to pay for it.
This is not about coffee. Remember the tagline? Anything can happen
over a cup of coffee.
VG Siddhartha as a great strategist
When he decided to get into the coffee business,
everyone advised him against it. But he
persisted.
People wondered why anyone would pay Rs. 40
for a cup of coffee when all it cost was Rs. 4 to
make it at home.
He was not looking for a substitute to home
brewed coffee.
It was getting into the boy-meets-girl business
Strategy loves adjacency
If you think of Cafe Coffee Day, do look at the way Siddhartha has
explored and harvested the power of adjacency.
Though his company‟s name suggests that you would get a fresh brew
each time you go to a Cafe Coffee Day, he can actually serve you
everything that is adjacent to coffee that the boy and the girl might need:
Samosa, sandwiches, brownies, Snapples, branded water & in some outlets, beer and
more potent forms of alcohol!
God did not tell him that he can and should sell only coffee. He in turn, is
not whipping his boys and girls to sell more cups of mocha and
cappuccino, nor is he enticing his customer to keep drinking more coffee
per session so that his profitability and market share go up.
Siddhartha knows that in the boy meets girl business, the boy (usually
the lesser intelligent but more focused) ignores the right hand side of the
menu and pleads to the girl to try the black forest pastry or some equally
expensive thing on the menu so that she may linger longer.
Strategy loves adjacency
Adjacency is common knowledge to store merchandisers who are
always doing what we call “market basket analysis”.
Simply put, it means that your grocer must place jams next to the bread
alley and gourmet cheese close to the wine rack.
Similarly, if you have gone shopping for a pretty dress, you may be
more open than usual to consider accessories that go with it. So they
are displayed next to each other.
That simple idea is lost on leaders sitting around a table to contemplate
strategy for growth and profitability.
Siddhartha probably makes more money from things he does not make
than his original offering of roasted, crushed beans in hot water
If the doorman doesn‟t get it, it isn‟t strategy
So who do we see here and what is he doing?
It is perhaps quite easy for most to identify the man and with some effort,
the instrument for spinning thread from cotton; it is called the charkha.
Gandhi made the spinning wheel the symbol of self-reliance & rejection
of all things British. In the symbolism of the charkha was encapsulated
the demand of a slave nation for independence from foreign rule.
What does all that have to do with strategy?
If the doorman doesn‟t get it, it isn‟t strategy
Strategy must be something people can understand without
having to read user manual or undertaking a laborious journey
through Excel sheets.
A strategist understands the power of the picture over words and
metaphor over pictures. That is why Martin Luther King, in his
famous speech, said “I have a dream” and not, “I have a plan”.
In opposing the British, Mahatma Gandhi used a simple strategy
that the average people could understand in an instant.
Corporate leaders think strategy must be sophisticated, complex
and beyond average comprehension so that it looks like the real
stuff.
If something is simple, apparent and easy to follow, how can it
be strategy? Nothing can be farther than the truth.
Go in the direction of your opponent
Go in the direction of your opponent
Strategy is sometimes not about clashing with an adversary.
It is about going with him.
This is the essence of what Harvard professor David Yoffie
calls the “judo strategy”. Winning in Judo is not about
superior strength, it is about superior strategy.
In judo, you do not overpower your opponent with force; you
actually go with the force of the opponent to pin him down.
There is a famous photograph in Yoffie‟s book “Judo
Strategy” that depicts black belt champion Vladimir Putin
being thrown to the ground by a 10-year-old Japanese
school girl who outwitted the visiting Russian head of state
by simply going in the direction Putin was pulling her.
Go in the direction of your opponent
Congress President Sonia Gandhi did exactly that when opposition leaders raised
the issue of her citizenship and asked how could a “foreigner” like her become
the prime minister of India?
Go in the direction of your opponent All eyes were on her and everyone thought she would step in to the office & then face
the opposition wrath that could have also dragged her to court.
Nothing in the law says that a naturalized Indian cannot become the prime minister.
While a court ruling could still favor her, her opponents would have used the
opportunity to raise the issue of national security and such to get popular opinion
against her, particularly in a country in which fifty percent of people are not literate.
Sonia Gandhi chose not to fight the issue. She stayed out of the office of the prime
minister, instead asking Man Mohan Singh to become prime minister but in the
process, she remained the Congress party chief and it was evident and apparent that
the Congress-led government would not do anything that the party chief did not want
and all key issues needed her approval in any case.
In the process, Sonia Gandhi actually got a huge wave of sympathy and the
opposition leaders baying for her blood looked like a convoluted bunch spewing
narrow patriotism. Sonia Gandhi‟s strategy would go a long way because it is what I
call a game changer. Instead of leading a fractured coalition and facing a disruptive
opposition, she has retained the power without needing the position. Along the way,
she has kept the future secure for the scion of the Gandhi family who can, in good
time, combine the two.
What is changing in here ?
So, what is changing in here?
While leaders conceptualize strategy, they would do well to ask
themselves a fundamental question.
When the strategy hits the road, what would change?
When Rudy Giuliani took over as the Mayor of New York City the first
time in 1994, it was called the “murder capital” of the world. After taking
office, Giuliani summoned his police chief and asked for a small, simple
and speedy change. He wanted the pan-handlers off the street.
So, what is changing in here? When motorists stopped at the red lights of New York City, pan-handlers
dashed at their wind shield, made a symbolic, feigned attempt to clean it
& then asked for money.
It was a nuisance to say the least & sometimes refusal to pay could lead
to abuse and violence. The mayor wanted the pan handlers to stop
preying on motorists. It wasn‟t a difficult thing for the police.
What no one realized was that the real strategy went far beyond. As the
pan handlers went off the street, so did drug peddling.
The pan-handlers were both the consumers & the sellers; they were the
retail arm of the drug lords. When they left, the drug business dropped
and with it went murder because of the simple correlation between drug,
violence and man slaughter. But it all started when something visibly,
noticeably and irretrievably changed.
The initial action soon after a leader takes charge, often signals that it is
not business as usual. Through it, a leader notifies strategic intent.
If nothing is changing, it is no strategy.
But, How do I know ?
But, how do I know?
Quite often, people debate with themselves, how do I know what I
am engaged with is strategy? How do I know I am not dribbling
with the ball, thinking all the while that I am thinking strategy?
There are a few tell tale signs of whether you are dealing with the
real stuff or just playing with sand castles on the beach. When in
doubt, ask yourself
Are the stakes low?
If there is nothing much at stake, chances are you are dribbling.
Is there ample evidence of displacement?
Displacement could mean people, policies, products, services,
customers, suppliers, whatever. No sign of displacement, no
strategy
Are we making apparent choices ?
Are we making apparent choices ?
Strategy is about making strategic choices. These
are seldom „apparent‟ choices. So, if you are
solving a HR problem through a HR solution
(reining in attrition by increasing salary) or a sales
problem through an essentially sales solution
(increasing sales by increasing salespersons), you
may not be talking strategy.
Strategy and strategic choices are most likely to
be from outside the system.
Remember, in every mythology, the deliverer is an
outsider?
If nothing is changing,
it is no strategy
Happy Reading