All of us who knew and worked with Dhirubhai right from the early days have many wonderful memories of personal and extremely enlightening encounters with him. We came from varied backgrounds yet none of us had met a force like Dhirubhai before.
Our experience working for him has left such a lasting impression that I think we carry around a permanent 'Dhirubhai tattoo' on our brains and in our hearts!
1. The arm-around-the-shoulder leader
I have never seen any other empire builder nor the CEO of any big organisation do this (why, I never adopted this myself!).
It was Dhirubhai's very own signature style. Whenever I went to meet him and if on that day, all the time that he could spare me was a short walk up to his car, he would instantly put his arm around me and proceed to discuss the issues at hand as we walked.
With that one simple gesture, he managed to achieve many things. I was put at ease instantaneously. I was made to feel like an equal who was loved and important enough to be considered close to him. And I would walk away from that meeting feeling so good about myself and the work I was doing!
This tendency that he had, to draw people towards him, manifested itself in countless ways. This was just one of them. He would never, ever exude an air of aloofness and exclusivity. He was always inviting people into sharing their thoughts and ideas, rather than shutting them out.
On hindsight I think, it must have required phenomenal generosity of spirit to be that inclusive. Yes, this was one of the things that was uniquely Dhirubhai -- that warm arm around my shoulder that did much more than words in letting me know that I belonged, that I had his trust, and that I had him on my side!
2. The Dhirubhai theory of Supply creating Demand
He was not an MBA. Nor an economist. But yet he took traditional market theory and stood it on its head. And succeeded.
Yes, at a time when everyone in India would build capacities only after a careful study of market expectations, he went full steam ahead and created giants of manufacturing plants with unbelievable capacites. (Initial cap of Reliance Patalganga was 10,000 tonnes of PFY way back in 1980, while the market in India for it was approx. 6000 tonnes).
No doubt his instinct was backed by years and years of reading, studying market trends, careful listening and his own honed capacity to forecast, but yet despite all this preparation, it required undeniable guts to pioneer such a revolutionary move.
The consequence was that the market blossomed to absorb supply, the consumer benefited with prices crashing down, the players increased and our economic landscape changed for the better. The Patalganga plant was in no time humming at maximum capacity and as a result of the plant's economies of scale, Dhirubhai's conversion cost of the yarn in 1994 came down to 18 cents per pound, as compared to Western Europe's 34 cents, North America's 29 cents and the Far East's 23 cents and Reliance was exporting the yarn back to the US!
A more recent example was that of Mukesh Ambani taking this vision forward with Reliance Infocomm (which is now handled by Anil Ambani). In India's mobile telephony timeline there will always be a very clear 'before Infocomm and after Infocomm' segmentation. The numbers say it all. In Jan 2003, the mobile subscriber base was 13 million, about 16 months later, shortly after the launch, it had reached 30 million.
In March 2006, it has touched 90 million ! Yes, this was yet another unusual skill of Dhirubhai's -- his uncanny knack of knowing exactly how the market is going to behave.
3. Money is not a product by itself, it is a by-product, so don't chase it
This was a belief by which Dhirubhai lived all his life. For instance when he briefed me about setting up Mudra, his instruction was clear: 'Produce the best textile advertising in the country,' he said.
He did not breathe a word about profits, nor about becoming the richest ad agency in the country. Great advertising was the goal that he set for me. A by-product is something that you don't set out to produce. It is the spin off when you create something larger.
When you turn logs into lumber, sawdust is your by-product and a pretty lucrative one it can be too! It is a very simple analogy but extremely effective in driving the point home. Work toward a goal beyond your bank balance.
Success in attaining that goal will eventually ring in the cash. For instance, if you work towards creating a name for yourself and earning a good reputation, then money is a logical outcome.
People will pay for your product or service if it is good. But if you get your priorities slightly mixed up, not only will the money you make remain just a quick buck it would in all likelihood blacklist you for good. Sounds too simplistic for belief? Well, look around you and you will know exactly how true it is.
(Source: http://us.rediff.com/money/2006/sep/25spec.htm)
Monday, September 25, 2006
Great lessons from Dhirubhai Ambani
Dhirubhaism: Leave the professional alone!
Much as people would like to believe, most owners (even managers and clients), though eager to hire the best professionals in the field, do so and then use them as extensions of their own personality. Every time I come across this, which is much too often, I am reminded of how Dhirubhai's management techniques used to be (and still remain) so refreshingly different.
For instance, way back in the late 1970s when we decided to open an agency of our own, he asked me to name it. I carried a short list of three names, two Westernised and one Indian. It was a very different world back then. Everything Anglicised was considered "upmarket."
There were hardly any agencies with Indian names barring my own ex-agency Shilpi and a few others like Ulka and Sistas. He looked at the list and asked me what my choice was. I said "Mudra": it was the only name that suited my personality. And the spirit of the agency that I was to head.
I was very Indian and an Anglicised name on my visiting card would seem pretentious and contrived. No further questions were asked. No suggestions offered, just a plain and simple "Go ahead and do it." That was just the beginning.
He continued to give me total freedom -- no supervision, no policing -- in all my decisions thereafter. In fact, the only direction that he gave me, just once, was this: "Produce your best."
His utter trust in me was what pushed me to never, ever let him down. I guess the simplest strategies are often the hardest to adopt. That was the secret of the Dhirubhai legend. It was not out of a book. It was a skillful blend of head and heart.
Dhirubhaism: Change your orbit, constantly!
To understand this statement, let me explain Dhirubhai's "orbit theory."
He would often explain that we are all born into an orbit. It is up to us to progress to the next. We could choose to live and die in the orbit that we are born in. But that would be a criminal waste of potential. When we push ourselves into the next orbit, we benefit not only ourselves but everyone connected with us.
Take India's push for development. There was once a time our country's growth rate was just 4 per cent, sarcastically referred to as the "Hindu growth rate." Look at us today, galloping along at a healthy 7-8 per cent.
This is no miracle. It is the product of a handful of determined orbit changers like Dhirubhai, all of whose efforts have benefited a larger sphere in their respective fields.
In a small way, I too have experienced the thrill of changing orbits with Mudra. In the 1980s, we leapt from the orbit of a small Ahmedabad ad agency to become the country's third largest ad agency -- in just under a decade.
However, when you change orbits, you will create friction. The good news is that your enemies from your previous orbit will never be able to reach you in your new one. By the time resentment builds up in your new orbit, you should move to the next level. And so on.
Changing orbits is the key to our progress as a nation.
(Source: http://in.rediff.com/money/2006/aug/11spec.htm)
Much as people would like to believe, most owners (even managers and clients), though eager to hire the best professionals in the field, do so and then use them as extensions of their own personality. Every time I come across this, which is much too often, I am reminded of how Dhirubhai's management techniques used to be (and still remain) so refreshingly different.
For instance, way back in the late 1970s when we decided to open an agency of our own, he asked me to name it. I carried a short list of three names, two Westernised and one Indian. It was a very different world back then. Everything Anglicised was considered "upmarket."
There were hardly any agencies with Indian names barring my own ex-agency Shilpi and a few others like Ulka and Sistas. He looked at the list and asked me what my choice was. I said "Mudra": it was the only name that suited my personality. And the spirit of the agency that I was to head.
I was very Indian and an Anglicised name on my visiting card would seem pretentious and contrived. No further questions were asked. No suggestions offered, just a plain and simple "Go ahead and do it." That was just the beginning.
He continued to give me total freedom -- no supervision, no policing -- in all my decisions thereafter. In fact, the only direction that he gave me, just once, was this: "Produce your best."
His utter trust in me was what pushed me to never, ever let him down. I guess the simplest strategies are often the hardest to adopt. That was the secret of the Dhirubhai legend. It was not out of a book. It was a skillful blend of head and heart.
Dhirubhaism: Change your orbit, constantly!
To understand this statement, let me explain Dhirubhai's "orbit theory."
He would often explain that we are all born into an orbit. It is up to us to progress to the next. We could choose to live and die in the orbit that we are born in. But that would be a criminal waste of potential. When we push ourselves into the next orbit, we benefit not only ourselves but everyone connected with us.
Take India's push for development. There was once a time our country's growth rate was just 4 per cent, sarcastically referred to as the "Hindu growth rate." Look at us today, galloping along at a healthy 7-8 per cent.
This is no miracle. It is the product of a handful of determined orbit changers like Dhirubhai, all of whose efforts have benefited a larger sphere in their respective fields.
In a small way, I too have experienced the thrill of changing orbits with Mudra. In the 1980s, we leapt from the orbit of a small Ahmedabad ad agency to become the country's third largest ad agency -- in just under a decade.
However, when you change orbits, you will create friction. The good news is that your enemies from your previous orbit will never be able to reach you in your new one. By the time resentment builds up in your new orbit, you should move to the next level. And so on.
Changing orbits is the key to our progress as a nation.
(Source: http://in.rediff.com/money/2006/aug/11spec.htm)
Dhirubhai gave management a whole new 'ism'
Dhirubhai Ambani was no ordinary leader. He was a man who gave management a whole new "ism".
There is a new "ism" that I've been meaning to add to the vast world of words for quite a while now. Because, without exaggeration, it's a word for which no synonym can do full justice: "Dhirubhaism".
Inspired by the truly phenomenal Dhirubhai H Ambani, it denotes a characteristic, tendency or syndrome as demonstrated by its inspirer. Dhirubhai, on his part, had he been around, would have laughed heartily and declared, "Small men like me don't inspire big words!"
There you have it - now that is a classic Dhirubhaism, the tendency to disregard one's own invaluable contribution to society as significant.
I'm sure everyone who knew Dhirubhai well will have his or her own little anecdote that illustrates his unique personality. He was a person whose heart and head both worked at peak efficiency levels, all the time. And that resulted in a truly unique and remarkable work philosophy, which is what I would like to define as Dhirubhaism.
Let me explain this new "ism" with a few examples from my own experiences of working with him.
Dhirubhaism No 1: Roll up your sleeves and help. You and your team share the same DNA. Reliance, during Vimal's heady days had organized a fashion show at the Convention Hall, at Ashoka Hotel in New Delhi.
As usual, every seat in the hall was taken, and there were an equal number of impatient guests outside, waiting to be seated. I was of course completely besieged, trying to handle the ensuing confusion, chaos and protests, when to my amazement and relief, I saw Dhirubhai at the door trying to pacify the guests.
Dhirubhai at that time was already a name to reckon with and a VIP himself, but that did not stop him from rolling up his sleeves and diving in to rescue a situation that had gone out of control. Most bosses in his place would have driven up in their swank cars at the last moment and given the manager a piece of their minds. Not Dhirubhai.
When things went wrong, he was the first person to sense that the circumstances would have been beyond his team's control, rather than it being a slip on their part, as he trusted their capabilities implicitly. His first instinct was always to join his men in putting out the fire and not crucifying them for it. Sounds too good a boss to be true, doesn't he? But then, that was Dhirubhai.
Dhirubhaism No 2: Be a safety net for your team. There used to be a time when our agency Mudra was the target of some extremely vicious propaganda by our peers, when on an almost daily basis my business ethics were put on trial. I, on my part, putting on a brave front, never raised this subject during any of my meetings with Dhirubhai.
But one day, during a particularly nasty spell, he gently asked me if I needed any help in combating it. That did it. That was all the help that I needed. Overwhelmed by his concern and compassion, I told him I could cope, but the knowledge that he knew and cared for what I was going through, and that he was there for me if I ever needed him, worked wonders for my confidence.
I went back a much taller man fully armed to face whatever came my way. By letting us know that he was always aware of the trials we underwent and that he was by our side through it all, he gave us the courage we never knew we had.
Dhirubhaism No 3: The silent benefactor. This was another of his remarkable traits. When he helped someone, he never ever breathed a word about it to anyone else. There have been none among us who haven't known his kindness, yet he never went around broadcasting it.
He never used charity as a platform to gain publicity. Sometimes, he would even go to the extent of not letting the recipient know who the donor was. Such was the extent of his generosity. "Expect the unexpected" just might have been coined for him.
Dhirubhaism No 4: Dream big but dream with your eyes open. His phenomenal achievement showed India that limitations were only in the mind. And that nothing was truly unattainable for those who dreamed big.
Whenever I tried to point out to him that a task seemed too big to be accomplished, he would reply: " No is no answer!" Not only did he dream big, he taught all of us to do so too. His one-line brief to me when we began Mudra was: "Make Vimal's advertising the benchmark for fashion advertising in the country."
At that time, we were just a tiny, fledgling agency, tucked away in Ahmedabad, struggling to put a team in place. When we presented the seemingly insurmountable to him, his favourite response was always: "It's difficult but not impossible!" And he was right. We did go on to achieve the impossible.
Both in its size and scope Vimal's fashion shows were unprecedented in the country. Grand showroom openings, stunning experiments in print and poster work all combined to give the brand a truly benchmark image. But way back in 1980, no one would have believed it could have ever been possible. Except Dhirubhai.
But though he dreamed big, he was able to clearly distinguish between perception and reality and his favourite phrase "dream with your eyes open" underlined this.
He never let preset norms govern his vision, yet he worked night and day familiarizing himself with every little nitty-gritty that constituted his dreams constantly sifting the wheat from the chaff. This is how, as he put it, even though he dreamed, none of his dreams turned into nightmares. And this is what gave him the courage to move from one orbit to the next despite tremendous odds.
Dhirubhai was indeed a man of many parts, as is evident. I am sure there are many people who display some of the traits mentioned above, in their working styles as well, but Dhirubhai was one of those rare people who demonstrated all of them, all the time.
And that's what made him such a phenomenal team builder and achiever. Yes, we all need "Dhirubhaisms" in our lives to remind us that if it was possible for one person to be all this and more, we too can. And like him, go on to achieve the impossible too.
(Source: http://in.rediff.com/money/2006/feb/03dhiru.htm)
There is a new "ism" that I've been meaning to add to the vast world of words for quite a while now. Because, without exaggeration, it's a word for which no synonym can do full justice: "Dhirubhaism".
Inspired by the truly phenomenal Dhirubhai H Ambani, it denotes a characteristic, tendency or syndrome as demonstrated by its inspirer. Dhirubhai, on his part, had he been around, would have laughed heartily and declared, "Small men like me don't inspire big words!"
There you have it - now that is a classic Dhirubhaism, the tendency to disregard one's own invaluable contribution to society as significant.
I'm sure everyone who knew Dhirubhai well will have his or her own little anecdote that illustrates his unique personality. He was a person whose heart and head both worked at peak efficiency levels, all the time. And that resulted in a truly unique and remarkable work philosophy, which is what I would like to define as Dhirubhaism.
Let me explain this new "ism" with a few examples from my own experiences of working with him.
Dhirubhaism No 1: Roll up your sleeves and help. You and your team share the same DNA. Reliance, during Vimal's heady days had organized a fashion show at the Convention Hall, at Ashoka Hotel in New Delhi.
As usual, every seat in the hall was taken, and there were an equal number of impatient guests outside, waiting to be seated. I was of course completely besieged, trying to handle the ensuing confusion, chaos and protests, when to my amazement and relief, I saw Dhirubhai at the door trying to pacify the guests.
Dhirubhai at that time was already a name to reckon with and a VIP himself, but that did not stop him from rolling up his sleeves and diving in to rescue a situation that had gone out of control. Most bosses in his place would have driven up in their swank cars at the last moment and given the manager a piece of their minds. Not Dhirubhai.
When things went wrong, he was the first person to sense that the circumstances would have been beyond his team's control, rather than it being a slip on their part, as he trusted their capabilities implicitly. His first instinct was always to join his men in putting out the fire and not crucifying them for it. Sounds too good a boss to be true, doesn't he? But then, that was Dhirubhai.
Dhirubhaism No 2: Be a safety net for your team. There used to be a time when our agency Mudra was the target of some extremely vicious propaganda by our peers, when on an almost daily basis my business ethics were put on trial. I, on my part, putting on a brave front, never raised this subject during any of my meetings with Dhirubhai.
But one day, during a particularly nasty spell, he gently asked me if I needed any help in combating it. That did it. That was all the help that I needed. Overwhelmed by his concern and compassion, I told him I could cope, but the knowledge that he knew and cared for what I was going through, and that he was there for me if I ever needed him, worked wonders for my confidence.
I went back a much taller man fully armed to face whatever came my way. By letting us know that he was always aware of the trials we underwent and that he was by our side through it all, he gave us the courage we never knew we had.
Dhirubhaism No 3: The silent benefactor. This was another of his remarkable traits. When he helped someone, he never ever breathed a word about it to anyone else. There have been none among us who haven't known his kindness, yet he never went around broadcasting it.
He never used charity as a platform to gain publicity. Sometimes, he would even go to the extent of not letting the recipient know who the donor was. Such was the extent of his generosity. "Expect the unexpected" just might have been coined for him.
Dhirubhaism No 4: Dream big but dream with your eyes open. His phenomenal achievement showed India that limitations were only in the mind. And that nothing was truly unattainable for those who dreamed big.
Whenever I tried to point out to him that a task seemed too big to be accomplished, he would reply: " No is no answer!" Not only did he dream big, he taught all of us to do so too. His one-line brief to me when we began Mudra was: "Make Vimal's advertising the benchmark for fashion advertising in the country."
At that time, we were just a tiny, fledgling agency, tucked away in Ahmedabad, struggling to put a team in place. When we presented the seemingly insurmountable to him, his favourite response was always: "It's difficult but not impossible!" And he was right. We did go on to achieve the impossible.
Both in its size and scope Vimal's fashion shows were unprecedented in the country. Grand showroom openings, stunning experiments in print and poster work all combined to give the brand a truly benchmark image. But way back in 1980, no one would have believed it could have ever been possible. Except Dhirubhai.
But though he dreamed big, he was able to clearly distinguish between perception and reality and his favourite phrase "dream with your eyes open" underlined this.
He never let preset norms govern his vision, yet he worked night and day familiarizing himself with every little nitty-gritty that constituted his dreams constantly sifting the wheat from the chaff. This is how, as he put it, even though he dreamed, none of his dreams turned into nightmares. And this is what gave him the courage to move from one orbit to the next despite tremendous odds.
Dhirubhai was indeed a man of many parts, as is evident. I am sure there are many people who display some of the traits mentioned above, in their working styles as well, but Dhirubhai was one of those rare people who demonstrated all of them, all the time.
And that's what made him such a phenomenal team builder and achiever. Yes, we all need "Dhirubhaisms" in our lives to remind us that if it was possible for one person to be all this and more, we too can. And like him, go on to achieve the impossible too.
(Source: http://in.rediff.com/money/2006/feb/03dhiru.htm)
Saturday, September 23, 2006
9 essentials of entrepreneurship
"Entrepreneurship is an attitude," says Ramalinga Raju. "It's for people who are willing to fail."
Speaking at the 2nd TiE-ISB Connect 2006 forum at the Indian School of Business, Hyderabad, Raju delved on the simple yet arduous task of creating enterprises.
Urging entrepreneurs to focus on customisation of products for India at low costs, he said one has to literally live with one's own idea to succeed ultimately.
"Investors may help entrepreneurs with a long rope, but if you fail they will hang you with the same rope! Entrepreneurship requires you to sacrifice a lot to pursue the business interests," he said.
"When I started my company, Satyam, I had to spend most of the time in the corridors of financial institutions. Finance was a major constraint," he said.
But today the scenario has changed. "Venture capitalists appreciate good ideas, so if you come up with an idea that satisfies customer's demands, you have a good chance of making it big. VCs look at intellectual capital. And there is a huge potential in India," added Raju.
Explaining the change in outlook of companies, Raju said: "Earlier, companies focussed on attracting employees, then the focus was on efficient management and later leadership. Today businesses have evolved and companies are largely focussing on entrepreneurship as a tool to enhance value in a large organisation."
"Satyam is structured in such a way that it allows entrepreneurs to flourish and we will continue to encourage new ideas," he said.
So what is entrepreneurship all about?
- It is all about hard work and applying your mind properly.
- It needs complete dedication to your ideas and putting your best efforts into them.
- It is going to bed thinking about the idea and waking up in the morning thinking about it.
- It is a field where you need constant attention at every detail.
- It is about driving yourself: If you are a professional, your boss will remind you that you are not working, if you an entrepreneur you have to remind yourself.
- It is about convincing others about your ideas too: You have to get the full support of your family and friends to succeed.
- It is about networking: Being an entrepreneur also means that you have to be constantly in touch with clients, customer and business partners at close quarters.
- It is about leadership: You should know how to be a leader and add value to the leadership with your ideas.
- It is about confidence: You have to live with the conviction that even if things don't work out in the initial stages, later on everything will be in place and you will emerge a winner.
(Source: http://ia.rediff.com/money/2006/sep/21tie.htm)
Wednesday, September 20, 2006
Vanilla Ice Cream that Puzzled General Motors
Never underestimate your Clients' Complaint, no matter how funny it might seem. This is a real story that happened between the customer of General Motors and its Customer Care Executive.
A complaint was received by the Pontiac Division of General Motors:
'This is the second time I have written to you, and I don't blame you for not answering me, because I sounded crazy, but it is a fact that we have a tradition in our family of Ice Cream for dessert after dinner each night, but the kind of ice cream varies so, every night, after we've eaten, the whole family votes on which kind of ice cream we should have and I drive down to the store to get it. It's also a fact that I recently purchased a new Pontiac and since then my trips to the store have created a problem.
You see, every time I buy a vanilla ice-cream, when I start back from the store my car won't start. If I get any other kind of ice cream, the car starts just fine. I want you to know I'm serious about this question, no matter how silly it sounds "What is there about a Pontiac that makes it not start when I get vanilla ice cream, and easy to start whenever I get any other kind?"
The Pontiac President was understandably skeptical about the letter, but sent an Engineer to check it out anyway.
The latter was surprised to be greeted by a successful, obviously well educated man in a fine neighborhood. He had arranged to meet the man just after dinner time, so the two hopped into the car and drove to the ice cream store. It was vanilla ice cream that night and, sure enough, after they came back to the car, it wouldn't start.
The Engineer returned for three more nights. The first night, they got chocolate. The car started. The second night, he got strawberry. The car started. The third night he ordered vanilla. The car failed to start.
Now the engineer, being a logical man, refused to believe that this man's car was allergic to vanilla ice cream. He arranged, therefore, to continue his visits for as long as it took to solve the problem. And toward this end he began to take notes: He jotted down all sorts of data: time of day, type of gas uses, time to drive back and forth etc.
In a short time, he had a clue: the man took less time to buy vanilla than any other flavor. Why? The answer was in the layout of the store. Vanilla, being the most popular flavor, was in a separate case at the front of the store for quick pickup. All the other flavors were kept in the back of the store at a different counter where it took considerably longer to check out the flavor.
Now, the question for the Engineer was why the car wouldn't start when it took less time. Eureka - Time was now the problem - not the vanilla ice cream!!!! The engineer quickly came up with the answer: "vapor lock".
It was happening every night; but the extra time taken to get the other flavors allowed the engine to cool down sufficiently to start. When the man got vanilla, the engine was still too hot for the vapor lock to dissipate.
Even crazy looking problems are sometimes real and all problems seem to be simple only when we find the solution, with cool thinking.
Don't just say it is “IMPOSSIBLE" without putting a sincere effort. Observe the word "IMPOSSIBLE" carefully. Looking closer you will see, "I'M POSSIBLE".
What really matters is your attitude and your perception.
A complaint was received by the Pontiac Division of General Motors:
'This is the second time I have written to you, and I don't blame you for not answering me, because I sounded crazy, but it is a fact that we have a tradition in our family of Ice Cream for dessert after dinner each night, but the kind of ice cream varies so, every night, after we've eaten, the whole family votes on which kind of ice cream we should have and I drive down to the store to get it. It's also a fact that I recently purchased a new Pontiac and since then my trips to the store have created a problem.
You see, every time I buy a vanilla ice-cream, when I start back from the store my car won't start. If I get any other kind of ice cream, the car starts just fine. I want you to know I'm serious about this question, no matter how silly it sounds "What is there about a Pontiac that makes it not start when I get vanilla ice cream, and easy to start whenever I get any other kind?"
The Pontiac President was understandably skeptical about the letter, but sent an Engineer to check it out anyway.
The latter was surprised to be greeted by a successful, obviously well educated man in a fine neighborhood. He had arranged to meet the man just after dinner time, so the two hopped into the car and drove to the ice cream store. It was vanilla ice cream that night and, sure enough, after they came back to the car, it wouldn't start.
The Engineer returned for three more nights. The first night, they got chocolate. The car started. The second night, he got strawberry. The car started. The third night he ordered vanilla. The car failed to start.
Now the engineer, being a logical man, refused to believe that this man's car was allergic to vanilla ice cream. He arranged, therefore, to continue his visits for as long as it took to solve the problem. And toward this end he began to take notes: He jotted down all sorts of data: time of day, type of gas uses, time to drive back and forth etc.
In a short time, he had a clue: the man took less time to buy vanilla than any other flavor. Why? The answer was in the layout of the store. Vanilla, being the most popular flavor, was in a separate case at the front of the store for quick pickup. All the other flavors were kept in the back of the store at a different counter where it took considerably longer to check out the flavor.
Now, the question for the Engineer was why the car wouldn't start when it took less time. Eureka - Time was now the problem - not the vanilla ice cream!!!! The engineer quickly came up with the answer: "vapor lock".
It was happening every night; but the extra time taken to get the other flavors allowed the engine to cool down sufficiently to start. When the man got vanilla, the engine was still too hot for the vapor lock to dissipate.
Even crazy looking problems are sometimes real and all problems seem to be simple only when we find the solution, with cool thinking.
Don't just say it is “IMPOSSIBLE" without putting a sincere effort. Observe the word "IMPOSSIBLE" carefully. Looking closer you will see, "I'M POSSIBLE".
What really matters is your attitude and your perception.
Tuesday, September 19, 2006
The inspiring rags-to-riches tale of Sarathbabu
When 27-year old Sarathbabu graduated from the Indian Institute of Management, Ahmedabad, he created quite a stir by refusing a job that offered him a huge salary. He preferred to start his own enterprise -- Foodking Catering Service -- in Ahmedabad.
He was inspired by his mother who once sold idlis on the pavements of Chennai, to educate him and his siblings. It was a dream come true, when Infosys co-founder N R Narayana Murthy lit the traditional lamp and inaugurated Sarathbabu's enterprise.
Sarathbabu was in Chennai, his hometown, a few days ago, to explore the possibility of starting a Foodking unit in the city and also to distribute the Ullas Trust Scholarships instituted by the IT firm Polaris to 2,000 poor students in corporation schools.
In this interview with rediff.com, Sarathbabu describes his rise from a Chennai slum to his journey to the nation's premier management institute to becoming a successful entrepreneur. This is his story, in his own words.
Childhood in a slum
I was born and brought up in a slum in Madipakkam in Chennai. I have two elder sisters and two younger brothers and my mother was the sole breadwinner of the family. It was really tough for her to bring up five kids on her meagre salary.
As she had studied till the tenth standard, she got a job under the mid-day meal scheme of the Tamil Nadu government in a school at a salary of Rs 30 a month. She made just one rupee a day for six people.
So, she sold idlis in the mornings. She would then work for the mid-day meal at the school during daytime. In the evenings, she taught at the adult education programme of the Indian government.
She, thus, did three different jobs to bring us up and educate us. Although she didn't say explicitly that we should study well, we knew she was struggling hard to send us to school. I was determined that her hard work should not go in vain.
I was a topper throughout my school days. In the mornings, we went out to sell idlis because people in slums did not come out of their homes to buy idlis. For kids living in a slum, idlis for breakfast is something very special.
My mother was not aware of institutions like the Birla Institute of Technology and Science, Pilani, or the Indian Institutes of Technology. She only wanted to educate us so that we got a good job. I didn't know what I wanted to do at that time because in my friend-circle, nobody talked about higher education or preparing for the IIT-JEE.
When you constantly worry about the next square meal, you do not dream of becoming a doctor or an engineer. The only thing that was on my mind was to get a good job because my mother was struggling a lot.
I got very good marks in the 10th standard exam. It was the most critical moment of my life. Till the 10th, there was no special fee but for the 11th and the 12th, the fees were Rs 2,000-3,000.
I did book-binding work during the summer vacation and accumulated money for my school fees. When I got plenty of work, I employed 20 other children and all of us did the work together. That was my first real job as an entrepreneur. Once I saw the opportunity, I continued with the work.
Life at BITS, Pilani
Sarathbabau. Photograph: Sreeram SelvarajA classmate of mine told me about BITS, Pilani. He was confident that I would get admission, as I was the topper. He also told me that on completion (of studies at Pilani), I will definitely get a job.
When I got the admission, I had mixed feelings. On one hand I was excited that for the first time I was going out of Chennai, but there was also a sense of uncertainty.
The fees alone were around Rs 28,000, and I had to get around Rs 42,000. It was huge, huge money for us. And there was no one to help us. Just my mother and sisters. One of my sisters -- they were all married by then -- pawned her jewellery and that's how I paid for the first semester.
My mother then found out about an Indian government scholarship scheme. She sent me the application forms, I applied for the scholarship, and I was successful. So, after the first semester, it was the scholarship that helped me through.
It also helped me to pay my debt (to the sister who had pawned her jewellery). I then borrowed money from my other sister and repaid her when the next scholarship came.
The scholarship, however, covered only the tuition fees. What about the hostel fees and food? Even small things like a washing soap or a toothbrush or a tube of toothpaste was a burden. So, I borrowed more at high rates of interest. The debt grew to a substantial amount by the time I reached the fourth year.
First year at BITS, Pilani
To put it mildly, I was absolutely shocked. Till then, I had moved only with students from poor families. At Pilani, all the students were from the upper class or upper middle class families. Their lifestyle was totally different from mine. The topics they discussed were alien to me. They would talk about the good times they had in school.
On the other hand, my school years were a big struggle. There was this communication problem also as I was not conversant in English then.
I just kept quiet and observed them. I concentrated only on my studies because back home so many people had sacrificed for me. And, it took a really long time -- till the end of the first year -- to make friends.
The second year
I became a little more confident and started opening up. I had worked really hard for the engineering exhibition during the first year. I did a lot of labour-intensive work like welding and cutting, though my subject was chemical engineering. My seniors appreciated me.
In my second year also, I worked really hard for the engineering exhibition. This time, my juniors appreciated me, and they became my close friends, so close that they would be at my beck and call.
In the third year, when there was an election for the post of the co-ordinator for the exhibition, my juniors wanted me to contest. Thanks to their efforts I was unanimously elected. That was my first experience of being in the limelight. It was also quite an experience to handle around 100 students.
Seeing my work, slowly my batch mates also came to the fold. All of them said I lead the team very well.
They also told me that I could be a good manager and asked me to do MBA. That was the first time I heard about something called MBA. I asked them about the best institution in India. They said, the Indian Institutes of Management. Then, I decided if I was going to study MBA, it should be at one of the IIMs, and nowhere else.
Inspiration to be an entrepreneur
It was while preparing for the Common Admission Test that I read in the papers that 30 per cent of India's population does not get two meals a day. I know how it feels to be hungry. What should be done to help them, I wondered.
I also read about Infosys and Narayana Murthy, Reliance and Ambani. Reliance employed 20,000-25,000 people at that time, and Infosys, around 15,000. When a single entrepreneur like Ambani employed 25,000 people, he was supporting the family, of four or five, of each employee. So he was taking care of 100,000 people indirectly. I felt I, too, should become an entrepreneur.
But, my mother was waiting for her engineer son to get a job, pay all the debts, build a pucca house and take care of her. And here I was dreaming about starting my own enterprise. I decided to go for a campus interview, and got a job with Polaris. I also sat for CAT but I failed to clear it in my first attempt.
I worked for 30 months at Polaris. By then, I could pay off all the debts but I hadn't built a proper house for my mother. But I decided to pursue my dream. When I took CAT for the third time, I cleared it and got calls from all the six IIMs. I got admission at IIM, Ahmedabad.
Life at IIM, Ahmedabad
My college helped me get a scholarship for the two years that I was at IIM. Unlike in BITS, I was more confident and life at IIM was fantastic. I took up a lot of responsibilities in the college. I was in the mess committee in the first year and in the second year; I was elected the mess secretary.
Becoming an entrepreneur
By the end of the second year, there were many lucrative job offers coming our way, but in my mind I was determined to start something on my own. But back home, I didn't have a house. It was a difficult decision to say 'no' to offers that gave you Rs 800,000 a year. But I was clear in my mind even while I knew the hard realities back home.
Yes, my mother had been an entrepreneur, and subconsciously, she must have inspired me. My inspirations were also (Dhirubhai) Ambani and Narayana Murthy. I knew I was not aiming at something unachievable. I got the courage from them to start my own enterprise.
Nobody at my institute discouraged me. In fact, at least 30-40 students at the IIM wanted to be entrepreneurs. And we used to discuss about ideas all the time. My last option was to take up a job.
Foodking Catering Services Pvt Ltd
My mother is my first inspiration to start a food business. Remember I started my life selling idlis in my slum. Then of course, my experience as the mess secretary at IIM-A was the second inspiration. I must have handled at least a thousand complaints and a thousand suggestions at that time. Every time I solved a problem, they thanked me.
I also felt there is a good opportunity in the food business. If you notice, a lot of people who work in the food business come from the weaker sections of the society.
My friends helped me with registering the company with a capital of Rs 100,000. Because of the IIM brand and also because of the media attention, I could take a loan from the bank without any problem.
I set up an office and employed three persons. The first order was from a software company in Ahmedabad. They wanted us to supply tea, coffee and snacks. We transported the items in an auto.
When I got the order from IIM, Ahmedabad, I took a loan of Rs 11 lakhs (Rs 1.1 million) and started a kitchen. So, my initial capital was Rs 11.75 lakhs (Rs 1.17 million).
Three months have passed, and now we have forty employees and four clients -- IIM Ahmedabad, Darpana Academy, Gujarat Energy Research Management Institute and System Plus.
In the first month of our operation, we earned around Rs 35,000. Now, the turnover is around Rs 250,000. The Chennai operations will start in another three months' time.
Ambition
I want to employ as many people as I can, and improve their quality of life. In the first year, I want to employ around 200-500 people. In the next five years, I hope to increase it by 15,000. I am sure it is possible.
I want to cover all the major cities in India, and later, I want to go around the world too.
I have seen people from all walks of life -- from the slums to the elite in the country. That is why luxuries like a car or a bungalow do not matter to me. Even money doesn't matter to me. I feel bad if I have to have food in a five star hotel. I feel guilty.
Personally, I have no ambition but I want to give a house and a car to my mother.
Appreciation
I did not expect this kind of exposure by the media for my venture or appreciation from people like my director at the IIM or Narayana Murthy. I was just doing what I wanted to do. But the exposure really helped me get orders, finance, everything.
The best compliments I received were from Narayana Murthy and my director at IIM, Ahmedabad. When I told him (IIM-A director) about my decision to start a company, he hugged me and wished me luck. They have seen life, they have seen thousands and thousands of students and if they say it is a good decision, I am sure it is a good decision.
Reservation
Reservation should be a mix of all criteria. If you take a caste that comes under reservation, 80 per cent of the people will be poor and 20 per cent rich, the creamy layer. For the general category, it will be the other way around.
I feel equal weightage should be given for the economic background. A study has to be done on what is the purpose of reservation and what it has done to the needy. It should be more effective and efficient. In my case, I would not have demanded for reservation. I accepted it because the society felt I belonged to the deprived class and needed a helping hand.
Today, the opportunities are grabbed by a few. They should be ashamed of their ability if they avail reservation even after becoming an IAS officer or something like that. They are putting a burden on the society and denying a chance to the really needy.
I feel reservation is enough for one generation. For example, if the child's father is educated, he will be able to guide the child properly.
Take my case, I didn't have any system that would make me aware of the IITs and the IIMs. But I will be able to guide my children properly because I am well educated. I got the benefits of reservation but I will never avail of it for my children. I cannot even think of demanding reservation for the next generation.
(Source: http://us.rediff.com/money/2006/aug/31spec.htm)
He was inspired by his mother who once sold idlis on the pavements of Chennai, to educate him and his siblings. It was a dream come true, when Infosys co-founder N R Narayana Murthy lit the traditional lamp and inaugurated Sarathbabu's enterprise.
Sarathbabu was in Chennai, his hometown, a few days ago, to explore the possibility of starting a Foodking unit in the city and also to distribute the Ullas Trust Scholarships instituted by the IT firm Polaris to 2,000 poor students in corporation schools.
In this interview with rediff.com, Sarathbabu describes his rise from a Chennai slum to his journey to the nation's premier management institute to becoming a successful entrepreneur. This is his story, in his own words.
Childhood in a slum
I was born and brought up in a slum in Madipakkam in Chennai. I have two elder sisters and two younger brothers and my mother was the sole breadwinner of the family. It was really tough for her to bring up five kids on her meagre salary.
As she had studied till the tenth standard, she got a job under the mid-day meal scheme of the Tamil Nadu government in a school at a salary of Rs 30 a month. She made just one rupee a day for six people.
So, she sold idlis in the mornings. She would then work for the mid-day meal at the school during daytime. In the evenings, she taught at the adult education programme of the Indian government.
She, thus, did three different jobs to bring us up and educate us. Although she didn't say explicitly that we should study well, we knew she was struggling hard to send us to school. I was determined that her hard work should not go in vain.
I was a topper throughout my school days. In the mornings, we went out to sell idlis because people in slums did not come out of their homes to buy idlis. For kids living in a slum, idlis for breakfast is something very special.
My mother was not aware of institutions like the Birla Institute of Technology and Science, Pilani, or the Indian Institutes of Technology. She only wanted to educate us so that we got a good job. I didn't know what I wanted to do at that time because in my friend-circle, nobody talked about higher education or preparing for the IIT-JEE.
When you constantly worry about the next square meal, you do not dream of becoming a doctor or an engineer. The only thing that was on my mind was to get a good job because my mother was struggling a lot.
I got very good marks in the 10th standard exam. It was the most critical moment of my life. Till the 10th, there was no special fee but for the 11th and the 12th, the fees were Rs 2,000-3,000.
I did book-binding work during the summer vacation and accumulated money for my school fees. When I got plenty of work, I employed 20 other children and all of us did the work together. That was my first real job as an entrepreneur. Once I saw the opportunity, I continued with the work.
Life at BITS, Pilani
Sarathbabau. Photograph: Sreeram SelvarajA classmate of mine told me about BITS, Pilani. He was confident that I would get admission, as I was the topper. He also told me that on completion (of studies at Pilani), I will definitely get a job.
When I got the admission, I had mixed feelings. On one hand I was excited that for the first time I was going out of Chennai, but there was also a sense of uncertainty.
The fees alone were around Rs 28,000, and I had to get around Rs 42,000. It was huge, huge money for us. And there was no one to help us. Just my mother and sisters. One of my sisters -- they were all married by then -- pawned her jewellery and that's how I paid for the first semester.
My mother then found out about an Indian government scholarship scheme. She sent me the application forms, I applied for the scholarship, and I was successful. So, after the first semester, it was the scholarship that helped me through.
It also helped me to pay my debt (to the sister who had pawned her jewellery). I then borrowed money from my other sister and repaid her when the next scholarship came.
The scholarship, however, covered only the tuition fees. What about the hostel fees and food? Even small things like a washing soap or a toothbrush or a tube of toothpaste was a burden. So, I borrowed more at high rates of interest. The debt grew to a substantial amount by the time I reached the fourth year.
First year at BITS, Pilani
To put it mildly, I was absolutely shocked. Till then, I had moved only with students from poor families. At Pilani, all the students were from the upper class or upper middle class families. Their lifestyle was totally different from mine. The topics they discussed were alien to me. They would talk about the good times they had in school.
On the other hand, my school years were a big struggle. There was this communication problem also as I was not conversant in English then.
I just kept quiet and observed them. I concentrated only on my studies because back home so many people had sacrificed for me. And, it took a really long time -- till the end of the first year -- to make friends.
The second year
I became a little more confident and started opening up. I had worked really hard for the engineering exhibition during the first year. I did a lot of labour-intensive work like welding and cutting, though my subject was chemical engineering. My seniors appreciated me.
In my second year also, I worked really hard for the engineering exhibition. This time, my juniors appreciated me, and they became my close friends, so close that they would be at my beck and call.
In the third year, when there was an election for the post of the co-ordinator for the exhibition, my juniors wanted me to contest. Thanks to their efforts I was unanimously elected. That was my first experience of being in the limelight. It was also quite an experience to handle around 100 students.
Seeing my work, slowly my batch mates also came to the fold. All of them said I lead the team very well.
They also told me that I could be a good manager and asked me to do MBA. That was the first time I heard about something called MBA. I asked them about the best institution in India. They said, the Indian Institutes of Management. Then, I decided if I was going to study MBA, it should be at one of the IIMs, and nowhere else.
Inspiration to be an entrepreneur
It was while preparing for the Common Admission Test that I read in the papers that 30 per cent of India's population does not get two meals a day. I know how it feels to be hungry. What should be done to help them, I wondered.
I also read about Infosys and Narayana Murthy, Reliance and Ambani. Reliance employed 20,000-25,000 people at that time, and Infosys, around 15,000. When a single entrepreneur like Ambani employed 25,000 people, he was supporting the family, of four or five, of each employee. So he was taking care of 100,000 people indirectly. I felt I, too, should become an entrepreneur.
But, my mother was waiting for her engineer son to get a job, pay all the debts, build a pucca house and take care of her. And here I was dreaming about starting my own enterprise. I decided to go for a campus interview, and got a job with Polaris. I also sat for CAT but I failed to clear it in my first attempt.
I worked for 30 months at Polaris. By then, I could pay off all the debts but I hadn't built a proper house for my mother. But I decided to pursue my dream. When I took CAT for the third time, I cleared it and got calls from all the six IIMs. I got admission at IIM, Ahmedabad.
Life at IIM, Ahmedabad
My college helped me get a scholarship for the two years that I was at IIM. Unlike in BITS, I was more confident and life at IIM was fantastic. I took up a lot of responsibilities in the college. I was in the mess committee in the first year and in the second year; I was elected the mess secretary.
Becoming an entrepreneur
By the end of the second year, there were many lucrative job offers coming our way, but in my mind I was determined to start something on my own. But back home, I didn't have a house. It was a difficult decision to say 'no' to offers that gave you Rs 800,000 a year. But I was clear in my mind even while I knew the hard realities back home.
Yes, my mother had been an entrepreneur, and subconsciously, she must have inspired me. My inspirations were also (Dhirubhai) Ambani and Narayana Murthy. I knew I was not aiming at something unachievable. I got the courage from them to start my own enterprise.
Nobody at my institute discouraged me. In fact, at least 30-40 students at the IIM wanted to be entrepreneurs. And we used to discuss about ideas all the time. My last option was to take up a job.
Foodking Catering Services Pvt Ltd
My mother is my first inspiration to start a food business. Remember I started my life selling idlis in my slum. Then of course, my experience as the mess secretary at IIM-A was the second inspiration. I must have handled at least a thousand complaints and a thousand suggestions at that time. Every time I solved a problem, they thanked me.
I also felt there is a good opportunity in the food business. If you notice, a lot of people who work in the food business come from the weaker sections of the society.
My friends helped me with registering the company with a capital of Rs 100,000. Because of the IIM brand and also because of the media attention, I could take a loan from the bank without any problem.
I set up an office and employed three persons. The first order was from a software company in Ahmedabad. They wanted us to supply tea, coffee and snacks. We transported the items in an auto.
When I got the order from IIM, Ahmedabad, I took a loan of Rs 11 lakhs (Rs 1.1 million) and started a kitchen. So, my initial capital was Rs 11.75 lakhs (Rs 1.17 million).
Three months have passed, and now we have forty employees and four clients -- IIM Ahmedabad, Darpana Academy, Gujarat Energy Research Management Institute and System Plus.
In the first month of our operation, we earned around Rs 35,000. Now, the turnover is around Rs 250,000. The Chennai operations will start in another three months' time.
Ambition
I want to employ as many people as I can, and improve their quality of life. In the first year, I want to employ around 200-500 people. In the next five years, I hope to increase it by 15,000. I am sure it is possible.
I want to cover all the major cities in India, and later, I want to go around the world too.
I have seen people from all walks of life -- from the slums to the elite in the country. That is why luxuries like a car or a bungalow do not matter to me. Even money doesn't matter to me. I feel bad if I have to have food in a five star hotel. I feel guilty.
Personally, I have no ambition but I want to give a house and a car to my mother.
Appreciation
I did not expect this kind of exposure by the media for my venture or appreciation from people like my director at the IIM or Narayana Murthy. I was just doing what I wanted to do. But the exposure really helped me get orders, finance, everything.
The best compliments I received were from Narayana Murthy and my director at IIM, Ahmedabad. When I told him (IIM-A director) about my decision to start a company, he hugged me and wished me luck. They have seen life, they have seen thousands and thousands of students and if they say it is a good decision, I am sure it is a good decision.
Reservation
Reservation should be a mix of all criteria. If you take a caste that comes under reservation, 80 per cent of the people will be poor and 20 per cent rich, the creamy layer. For the general category, it will be the other way around.
I feel equal weightage should be given for the economic background. A study has to be done on what is the purpose of reservation and what it has done to the needy. It should be more effective and efficient. In my case, I would not have demanded for reservation. I accepted it because the society felt I belonged to the deprived class and needed a helping hand.
Today, the opportunities are grabbed by a few. They should be ashamed of their ability if they avail reservation even after becoming an IAS officer or something like that. They are putting a burden on the society and denying a chance to the really needy.
I feel reservation is enough for one generation. For example, if the child's father is educated, he will be able to guide the child properly.
Take my case, I didn't have any system that would make me aware of the IITs and the IIMs. But I will be able to guide my children properly because I am well educated. I got the benefits of reservation but I will never avail of it for my children. I cannot even think of demanding reservation for the next generation.
(Source: http://us.rediff.com/money/2006/aug/31spec.htm)
Monday, September 18, 2006
Six Qualities That Make You A Crorepati
"The person who goes farthest is generally the one who is willing to do and dare. The sure-thing boat never gets far from the shore."
That's Dale Carnegie (1888-1955), failed farmer, teacher, journalist, actor, novelist, stock market investor. Also the bestselling author of How to Win Friends and Influence People that made him a millionaire.
Some people make their fortunes young. For others like Carnegie, it happens after a lifetime of wait and trial -- among other things, he lost his shirt in the 1929 Wall Street crash. But for most, it remains an unrealised dream.
What makes people go farthest on the path of creating wealth? Is there a formula to become a crorepati for ordinary people?
Carnegie -- arguably the first successful self-help author -- and other writers, especially those covering personal finance, have put forward their own prescriptions. While only a few readers may have benefited, the best-selling among the authors have become millionaires.
The better informed among us might blurt out the conventional financial wisdom which Outlook Money and other publications have come up with from time to time -- start saving and investing early and keep doing it regularly, take loans within limits, insure your life and assets and so on.
But while financial prudence and planning are important prerequisites to make millions, they aren't enough. In the wealth creation derby, what do the winners do which the also-rans don't?
The six qualities of crorepatis
To get the answer, we studied the wealth creation stories of some crorepatis and picked up lessons from their lives that you can use. We found that six old-fashioned attributes -- self-belief, perseverance, seizing opportunities, innovation, betting on your talent and constant learning -- play a pivotal role in determining our wealth.
From the individual stories of six people, it comes out clearly that, though wealth wasn't their primary goal when they set out, it was a driving force for the success they achieved.
1. Self-Belief
The path of wealth creation is often bumpy and can even resemble a roller-coaster ride. Ask Delhi-based Sanjay Chowdhary, 39, franchisee, Reliance Webworld Express, and he will tell you, for he has seen it all.
He began as a government upper division clerk (UDC) with a salary of Rs 1,400 per month in 1987, went on to clock annual revenues of Rs 25 lakh (Rs 2.5 million) from his Airtel shop in partnership with his sibling by 2003, then gave it all away to his brother and started from scratch to build a successful Reliance Webworld Express franchise.
"When I got engaged to my wife Radha in 1996, I used to ride a motorbike to meet her. Today, I own a Chevrolet Optra," says Chowdhary, summing up his journey of wealth. What kept Chowdhary on course towards his tryst with fortune? The answer: a peerless quality called self-belief.
From employment to self-employment: When Chowdhary quit his government job in 1995, his monthly pay stood at Rs 6,500. "Since I was a UDC, I could not have done much in that department," says Chowdhary. "Realising that mobility was restricted in a government set-up, he opened a shop along with his brother in the refurbished drawing room of his house in Delhi's swanky Greater Kailash-II. The start-up capital of Rs 1 lakh (Rs 100,000) was drawn from family reserves. "We wanted to be different and offer products that were not available in the vicinity," says Chowdhary.
At that point, the telecom sector was still in its infancy and Chowdhary decided to take up an Airtel dealership. Gradually, he started selling cell phones and also sundry gift items. The business soon became profitable and in five years, revenues from the store skied to Rs 25 lakh (Rs 2.5 million) annually.
Plunge into the abyss: In 2003, tragedy struck. Chowdhary legally split with his brother and surrendered the shop to strike out on his own. At this juncture, Reliance stormed into the telecom scene and Chowdhary chose to become a franchisee of Reliance Webworld Express.
The company rented out Chowdhary's property for the venture. Apart from the rent he got from Reliance, he managed the franchise as well. With old customers coming in, collections from his franchise now stand at Rs 30 lakh (Rs 3 million) a month.
While Chowdhary is diplomatic when quizzed on his net worth, taking his revenues and financial and real estate assets into account, he can safely be termed a crorepati.
2. Perseverance
The year: 1969. Trekking his way through Iran and Turkey, Mahesh Naithani, 23, on his way to England for higher studies, is temporarily incarcerated in a Bulgarian transit jail.
Naithani, son of an Allahabad University academic, was armed with a Master's degree in Political Science and saddled with the disappointment of a futile one-year search for a corporate job when he boarded a cargo ship from Mumbai a few months back with just Rs 500 in his pocket.
He ran out of money on the way and had to sell his prized watch for $50 in Teheran to raise money for the air journey to Turkey. Was he running out of luck? Would he have to shelve his plans for a better future?
Cut to 2006 and successful US-based serial entrepreneur Naithani talks about his net worth in excess of $25 million with nonchalance. What powered his remarkable journey to wealth? Perseverance.
From the Bulgarian transit jail to Yugoslavia, then again to an Austrian transit jail, finally to Germany, where by working night shifts at an exhibition, staying at a youth hostel and surviving on free hot dogs, he managed to save money for his trip to England via France.
Dismayed with the anti-immigration sentiments in England when he landed there, Naithani soon crossed the Atlantic to the US for higher studies.
Turnaround begins. With a little help from an American friend, Naithani managed to land a factory job in Minneapolis at a wage of $2.75 an hour that helped him save enough to enroll in the MBA programme in the University of Minnesota in 1970.
Naithani's perseverance and never-say-die attitude was fashioning his life's turnaround. The good luck continued. At a cultural gathering, he mistook Christina, a sociology student from El Salvador, for a Manipuri girl. Thus began their relationship that culminated in marriage.
In 1972, Naithani completed his MBA and took up a $14,000 per annum job offer by The New York Times. For the next ten years, he remained in the corporate sector, working in large companies, moving up to the post of vice president with an annual pay packet of $54,000.
In 1982, seeing an emerging opportunity in medical content business, he bought a small company called QSI for $50,000. He ran the company for three years and sold it for $250,000 to industry major International Thomson in 1985.
He then acquired a company called HCI for $200,000. In 1997, Naithani sold HCI to industry leader VNU for $24 million. "A five-year non-compete clause in the deal meant that I had to devote my energy to other things," says Naithani.
He turned to his passion, art and culture, and produced three movies, Jai Ganga, Bombay Boys and Such a Long Journey. But a failed takeover attempt of a movie company and a shelved BBC documentary project made him reconsider his options.
In 2003, as the non-compete clause tenure ended, Naithani decided to re-boot into medical content. This was how MedMeme was born with a $2.5-3 million start-up capital. The company specialises in collection and analysis of clinical and marketing intelligence and has the world's top pharma and healthcare companies as its clients with its back-office in Gurgaon.
Naithani's repeated successes underscore the importance of perseverance even in the wake of dismal failures.
3. Seizing opportunities
"Successful people screen incoming information differently since they constantly seek new growth opportunities," points out Jacob Samuel Vazholil, associate partner, Elixir Web Solutions, a leading recruitment process outsourcing firm.
Opportunities are like waves and wealth creators are surfers. They have to spot the waves and position themselves to ride these. If you want an appropriate example, look no further than Jagdeep Khandpur, 47, of Prerna Management Consulting. Throughout his career, Khandpur spotted waves of emerging opportunities early, rode them and then moved on to the next emerging one. This approach has made Khandpur a crorepati.
Khandpur graduated in Economics from Punjab University in 1978 and then did his MBA from the same varsity before joining Vardhaman Spinning as a management trainee at Rs 1,200 a month.
"The stint gave me immense exposure," says Khandpur. The lad from Ludhiana gradually rose through the ranks until he became the deputy manager, HR. Another opportunity came calling when Milk Food appointed him personnel manager.
"I chose Milk Food as it offered challenges. At 25, I was made its HR head," says Khandpur.
Four years at Milk Food, and Khandpur was just ripe to tap the opportunity in the emerging soft drinks industry. He joined Pepsi as its northern region head and went on to become vice president, HR. He shifted base from Chandigarh to Delhi and after a short stay at Duracell, was lapped up by the Thapars as group vice president, HR, Ballarpur Industries.
The high note of the rising trajectory of opportunities was struck when five years on, Khandpur signed up with Bharti Televentures as director, HR, at a time when telecom was still an emerging sector.
"The prospects at Ballarpur were brilliant, but I was not getting a chance to do something new after a certain point," says Khandpur. He was corporate director, HR, in Bharti when he quit his job in October 2005 to start his own enterprise, Prerna Management Consulting.
"I wanted to do something that provided me enough challenges and opportunities to learn," says Khandpur. He arranged for the start-up capital and his company's revenues are already at Rs 6 crore (Rs 60 million) now.
4. Innovation
It is now a clichè to say innovation creates wealth, for most successful IT entrepreneurs in India and abroad bear testimony to the fact. But can an ordinary person innovate and create wealth? Yes, if he doesn't mind taking risks.
"Risk taking is about having the inner confidence in what you're doing and learning to match your strengths with your goals," says Anil Sachdev, founder and CEO, Grow Talent Company.
Take a peep into the life of Sanjiv Saran Mehra, 44, CEO, Saran Presents, an event management company, and you will realise how innovation helped him turn his love for sports -- he has played games like squash and tennis at the club level -- into a money spinner.
Mehra, a management graduate from SP Jain Institute of Management and Research, Mumbai, started his career as an investment banker with Lazard India making about Rs 2 lakh (Rs 200,000) a year in 1985. "I realised what I was doing at Lazard could be done better if I started something on my own," he says.
When he left Lazard in 1990, Mehra drew around Rs 8-12 lakh per annum. He started Vision Financial Services, a finance boutique that organised SME funding, in a 200 sq ft office in Mumbai, with Rs 40,000 from his provident fund money.
At Vision, his third eye enabled him to garner three-four times what he earned at Lazard. However, what put Mehta on the wealth creation fast track was a chance meeting with his old pal, Cawas Billimoria, who asked him to help him build the Sumo Federation of India which he was planning to set up. "That's how Saran Presents was born," says Mehra.
Once Saran Presents was on a roll, Mehra's financial boutique went into the green room. Being an ardent sports enthusiast, Mehra realised it could be frustrating for a busy executive to give up participating in competitive sports due to changed priorities. To fulfill the needs of such executives, Saran Presents started organising sports events among corporates from 1997.
Through corporate sports alone, Mehra now makes 40-50 times of what he used to make when he ran Vision. Today, he is in an enviable position: he earns millions from something close to his heart.
5. Betting on talent
Chinese Taoist philosopher Lao Tzu had said, "Turn being into an advantage and non-being into utility." Millionaires know where their strengths lie and play to these.
See how well Chennai-based Sadhana, 38, chief marketing officer, Focus Infotech, has played the wealth creation game.
"I am more of a people's person," says Sadhana. She leveraged her communication skills and excelled in various marketing jobs though she has never been formally trained in marketing. With a PG in microbiology from the University of Mumbai and a two-and-a-half-year course at NIIT, what were her chances of success in marketing? Of course, Sadhana had other ideas.
Talent buds: In 1990, she signed up with Aurelec Data Processing System, Pondicherry. "My CEO wanted me to be an analyst while my reporting officer wanted me to join the sales team," says Sadhana. The branch officer had his way and Sadhana found herself in the sales team.
Her salary then stood at Rs 2,500 per month. That's when her communication skills began talking results. Within six months, she was promoted to area manager and sooner than you think, she became a branch manager. Under her leadership, the Pondicherry branch was voted the 'Branch of the Year' for three consecutive years. She even received the 'Salesperson of the Year' award from her company.
In 1991, Sadhana moved to Nexus Computers, Aurelec's new avatar after reconstruction. Here, from regional director, she was promoted to vice president, networking. She was not only instrumental in setting up Nexus' networking division, but helped it touch a turnover of Rs 7 crore (Rs 70 million). Again, her talent for communication bore results.
In 2002, she bid adieu to Nexus and started her own company Platinum Technologies. In January 2003, she converted Platinum Technologies to a private limited company, Platinum Infosystems. It was a true blue IBM business partner.
In the first year of operations, Platinum Infosystems did business worth Rs 5 crore (Rs 50 million) and also won the 'IBM Business Partner of the Year' award. Sadhana's people skills were now in full bloom. Around the same time, she began consulting with Focus Infotech and joined the company as its chief marketing officer in December 2003.
In three years, the firm's revenues of Rs 9 crore (Rs 90 million) more than doubled. While Sadhana wouldn't tell us about her exact net worth, it is clear that her earnings from Platinum along with her pay in Focus, which, in all likelihood, would be having a key performance-based component, would have made her a member of the crorepati club by now.
She can now indulge herself in her hobbies of horse riding and collecting antiques.
6. Constant Learning
Catwoman Eartha Kitt in the TV series Batman once crooned, "I'm learning all the time. The tombstone will be my diploma." Ordinary people who finish rich use Kitt's philosophy to the hilt.
One example is Arvind T., 34, business head, MeritTrac Services, a skills assessment company.
After an MBA from IIM Lucknow in 1995, Arvind joined RPG as a management trainee at a salary of Rs 1.6 lakh (Rs 160,000) a year. "The atmosphere and the opportunity to learn is great at RPG. They ensure that the trainees get an all-round view of their functional area," says Arvind, who soon got a chance to work in different companies of the RPG Group, including RPG Cellular, RPG Cable and HMV (the music arm of RPG).
He remained a management trainee for about a year and slowly moved up the ladder, getting promoted from assistant manager to manager, sales. When he finally quit RPG after four years to join GE, he had become branch manager and had an annual pay of around Rs 4-5 lakh (Rs 400,000-500,000).
The exit trigger: new learning opportunities. "Every assignment was a challenge as you needed to complete them with the least amount of resources. This gave me lot of opportunity to innovate on the job," says Arvind of his stint at GE. Although Arvind was enjoying his work at GE, he wanted to gain international experience. So after four years at GE, he joined a small Singapore-based trading firm that promised him international exposure.
By now, the learn-and-earn bug in Arvind helped him draw an annual pay cheque of Rs 40 lakh (Rs 4 million). Soon, he recast his eyes on India -- the economy was booming and everyone wanted a piece of the growth pie.
"I did not want to miss the action," says Arvind. He took a huge cut in his salary and returned to India to MeritTrac in early 2006. "I was given the task of setting up a division and making it functional. There was no limit to what I could do," says Arvind.
Unlimited learning opportunities were guiding him again to higher earnings. Arvind's strategy to enter the crorepati club is simply this: accumulate a wide range of experience now for higher future earnings.
The six qualities we have gleaned from the stories of six individuals shed light on the behavioural basics that form the foundation of wealth creation.
Of course, you still have to adhere to the financial basics. Does this mean that wealth is guaranteed if you have these qualities? Unfortunately not, since no defined formula yields wealth. However, building blocks are clearly identifiable. Once you have them, you can combine them skilfully to immensely enhance your probability of hitting the bull's-eye.
(Source: http://us.rediff.com/money/2006/sep/18perfin.htm?q=tp&file=.htm)
That's Dale Carnegie (1888-1955), failed farmer, teacher, journalist, actor, novelist, stock market investor. Also the bestselling author of How to Win Friends and Influence People that made him a millionaire.
Some people make their fortunes young. For others like Carnegie, it happens after a lifetime of wait and trial -- among other things, he lost his shirt in the 1929 Wall Street crash. But for most, it remains an unrealised dream.
What makes people go farthest on the path of creating wealth? Is there a formula to become a crorepati for ordinary people?
Carnegie -- arguably the first successful self-help author -- and other writers, especially those covering personal finance, have put forward their own prescriptions. While only a few readers may have benefited, the best-selling among the authors have become millionaires.
The better informed among us might blurt out the conventional financial wisdom which Outlook Money and other publications have come up with from time to time -- start saving and investing early and keep doing it regularly, take loans within limits, insure your life and assets and so on.
But while financial prudence and planning are important prerequisites to make millions, they aren't enough. In the wealth creation derby, what do the winners do which the also-rans don't?
The six qualities of crorepatis
To get the answer, we studied the wealth creation stories of some crorepatis and picked up lessons from their lives that you can use. We found that six old-fashioned attributes -- self-belief, perseverance, seizing opportunities, innovation, betting on your talent and constant learning -- play a pivotal role in determining our wealth.
From the individual stories of six people, it comes out clearly that, though wealth wasn't their primary goal when they set out, it was a driving force for the success they achieved.
1. Self-Belief
The path of wealth creation is often bumpy and can even resemble a roller-coaster ride. Ask Delhi-based Sanjay Chowdhary, 39, franchisee, Reliance Webworld Express, and he will tell you, for he has seen it all.
He began as a government upper division clerk (UDC) with a salary of Rs 1,400 per month in 1987, went on to clock annual revenues of Rs 25 lakh (Rs 2.5 million) from his Airtel shop in partnership with his sibling by 2003, then gave it all away to his brother and started from scratch to build a successful Reliance Webworld Express franchise.
"When I got engaged to my wife Radha in 1996, I used to ride a motorbike to meet her. Today, I own a Chevrolet Optra," says Chowdhary, summing up his journey of wealth. What kept Chowdhary on course towards his tryst with fortune? The answer: a peerless quality called self-belief.
From employment to self-employment: When Chowdhary quit his government job in 1995, his monthly pay stood at Rs 6,500. "Since I was a UDC, I could not have done much in that department," says Chowdhary. "Realising that mobility was restricted in a government set-up, he opened a shop along with his brother in the refurbished drawing room of his house in Delhi's swanky Greater Kailash-II. The start-up capital of Rs 1 lakh (Rs 100,000) was drawn from family reserves. "We wanted to be different and offer products that were not available in the vicinity," says Chowdhary.
At that point, the telecom sector was still in its infancy and Chowdhary decided to take up an Airtel dealership. Gradually, he started selling cell phones and also sundry gift items. The business soon became profitable and in five years, revenues from the store skied to Rs 25 lakh (Rs 2.5 million) annually.
Plunge into the abyss: In 2003, tragedy struck. Chowdhary legally split with his brother and surrendered the shop to strike out on his own. At this juncture, Reliance stormed into the telecom scene and Chowdhary chose to become a franchisee of Reliance Webworld Express.
The company rented out Chowdhary's property for the venture. Apart from the rent he got from Reliance, he managed the franchise as well. With old customers coming in, collections from his franchise now stand at Rs 30 lakh (Rs 3 million) a month.
While Chowdhary is diplomatic when quizzed on his net worth, taking his revenues and financial and real estate assets into account, he can safely be termed a crorepati.
2. Perseverance
The year: 1969. Trekking his way through Iran and Turkey, Mahesh Naithani, 23, on his way to England for higher studies, is temporarily incarcerated in a Bulgarian transit jail.
Naithani, son of an Allahabad University academic, was armed with a Master's degree in Political Science and saddled with the disappointment of a futile one-year search for a corporate job when he boarded a cargo ship from Mumbai a few months back with just Rs 500 in his pocket.
He ran out of money on the way and had to sell his prized watch for $50 in Teheran to raise money for the air journey to Turkey. Was he running out of luck? Would he have to shelve his plans for a better future?
Cut to 2006 and successful US-based serial entrepreneur Naithani talks about his net worth in excess of $25 million with nonchalance. What powered his remarkable journey to wealth? Perseverance.
From the Bulgarian transit jail to Yugoslavia, then again to an Austrian transit jail, finally to Germany, where by working night shifts at an exhibition, staying at a youth hostel and surviving on free hot dogs, he managed to save money for his trip to England via France.
Dismayed with the anti-immigration sentiments in England when he landed there, Naithani soon crossed the Atlantic to the US for higher studies.
Turnaround begins. With a little help from an American friend, Naithani managed to land a factory job in Minneapolis at a wage of $2.75 an hour that helped him save enough to enroll in the MBA programme in the University of Minnesota in 1970.
Naithani's perseverance and never-say-die attitude was fashioning his life's turnaround. The good luck continued. At a cultural gathering, he mistook Christina, a sociology student from El Salvador, for a Manipuri girl. Thus began their relationship that culminated in marriage.
In 1972, Naithani completed his MBA and took up a $14,000 per annum job offer by The New York Times. For the next ten years, he remained in the corporate sector, working in large companies, moving up to the post of vice president with an annual pay packet of $54,000.
In 1982, seeing an emerging opportunity in medical content business, he bought a small company called QSI for $50,000. He ran the company for three years and sold it for $250,000 to industry major International Thomson in 1985.
He then acquired a company called HCI for $200,000. In 1997, Naithani sold HCI to industry leader VNU for $24 million. "A five-year non-compete clause in the deal meant that I had to devote my energy to other things," says Naithani.
He turned to his passion, art and culture, and produced three movies, Jai Ganga, Bombay Boys and Such a Long Journey. But a failed takeover attempt of a movie company and a shelved BBC documentary project made him reconsider his options.
In 2003, as the non-compete clause tenure ended, Naithani decided to re-boot into medical content. This was how MedMeme was born with a $2.5-3 million start-up capital. The company specialises in collection and analysis of clinical and marketing intelligence and has the world's top pharma and healthcare companies as its clients with its back-office in Gurgaon.
Naithani's repeated successes underscore the importance of perseverance even in the wake of dismal failures.
3. Seizing opportunities
"Successful people screen incoming information differently since they constantly seek new growth opportunities," points out Jacob Samuel Vazholil, associate partner, Elixir Web Solutions, a leading recruitment process outsourcing firm.
Opportunities are like waves and wealth creators are surfers. They have to spot the waves and position themselves to ride these. If you want an appropriate example, look no further than Jagdeep Khandpur, 47, of Prerna Management Consulting. Throughout his career, Khandpur spotted waves of emerging opportunities early, rode them and then moved on to the next emerging one. This approach has made Khandpur a crorepati.
Khandpur graduated in Economics from Punjab University in 1978 and then did his MBA from the same varsity before joining Vardhaman Spinning as a management trainee at Rs 1,200 a month.
"The stint gave me immense exposure," says Khandpur. The lad from Ludhiana gradually rose through the ranks until he became the deputy manager, HR. Another opportunity came calling when Milk Food appointed him personnel manager.
"I chose Milk Food as it offered challenges. At 25, I was made its HR head," says Khandpur.
Four years at Milk Food, and Khandpur was just ripe to tap the opportunity in the emerging soft drinks industry. He joined Pepsi as its northern region head and went on to become vice president, HR. He shifted base from Chandigarh to Delhi and after a short stay at Duracell, was lapped up by the Thapars as group vice president, HR, Ballarpur Industries.
The high note of the rising trajectory of opportunities was struck when five years on, Khandpur signed up with Bharti Televentures as director, HR, at a time when telecom was still an emerging sector.
"The prospects at Ballarpur were brilliant, but I was not getting a chance to do something new after a certain point," says Khandpur. He was corporate director, HR, in Bharti when he quit his job in October 2005 to start his own enterprise, Prerna Management Consulting.
"I wanted to do something that provided me enough challenges and opportunities to learn," says Khandpur. He arranged for the start-up capital and his company's revenues are already at Rs 6 crore (Rs 60 million) now.
4. Innovation
It is now a clichè to say innovation creates wealth, for most successful IT entrepreneurs in India and abroad bear testimony to the fact. But can an ordinary person innovate and create wealth? Yes, if he doesn't mind taking risks.
"Risk taking is about having the inner confidence in what you're doing and learning to match your strengths with your goals," says Anil Sachdev, founder and CEO, Grow Talent Company.
Take a peep into the life of Sanjiv Saran Mehra, 44, CEO, Saran Presents, an event management company, and you will realise how innovation helped him turn his love for sports -- he has played games like squash and tennis at the club level -- into a money spinner.
Mehra, a management graduate from SP Jain Institute of Management and Research, Mumbai, started his career as an investment banker with Lazard India making about Rs 2 lakh (Rs 200,000) a year in 1985. "I realised what I was doing at Lazard could be done better if I started something on my own," he says.
When he left Lazard in 1990, Mehra drew around Rs 8-12 lakh per annum. He started Vision Financial Services, a finance boutique that organised SME funding, in a 200 sq ft office in Mumbai, with Rs 40,000 from his provident fund money.
At Vision, his third eye enabled him to garner three-four times what he earned at Lazard. However, what put Mehta on the wealth creation fast track was a chance meeting with his old pal, Cawas Billimoria, who asked him to help him build the Sumo Federation of India which he was planning to set up. "That's how Saran Presents was born," says Mehra.
Once Saran Presents was on a roll, Mehra's financial boutique went into the green room. Being an ardent sports enthusiast, Mehra realised it could be frustrating for a busy executive to give up participating in competitive sports due to changed priorities. To fulfill the needs of such executives, Saran Presents started organising sports events among corporates from 1997.
Through corporate sports alone, Mehra now makes 40-50 times of what he used to make when he ran Vision. Today, he is in an enviable position: he earns millions from something close to his heart.
5. Betting on talent
Chinese Taoist philosopher Lao Tzu had said, "Turn being into an advantage and non-being into utility." Millionaires know where their strengths lie and play to these.
See how well Chennai-based Sadhana, 38, chief marketing officer, Focus Infotech, has played the wealth creation game.
"I am more of a people's person," says Sadhana. She leveraged her communication skills and excelled in various marketing jobs though she has never been formally trained in marketing. With a PG in microbiology from the University of Mumbai and a two-and-a-half-year course at NIIT, what were her chances of success in marketing? Of course, Sadhana had other ideas.
Talent buds: In 1990, she signed up with Aurelec Data Processing System, Pondicherry. "My CEO wanted me to be an analyst while my reporting officer wanted me to join the sales team," says Sadhana. The branch officer had his way and Sadhana found herself in the sales team.
Her salary then stood at Rs 2,500 per month. That's when her communication skills began talking results. Within six months, she was promoted to area manager and sooner than you think, she became a branch manager. Under her leadership, the Pondicherry branch was voted the 'Branch of the Year' for three consecutive years. She even received the 'Salesperson of the Year' award from her company.
In 1991, Sadhana moved to Nexus Computers, Aurelec's new avatar after reconstruction. Here, from regional director, she was promoted to vice president, networking. She was not only instrumental in setting up Nexus' networking division, but helped it touch a turnover of Rs 7 crore (Rs 70 million). Again, her talent for communication bore results.
In 2002, she bid adieu to Nexus and started her own company Platinum Technologies. In January 2003, she converted Platinum Technologies to a private limited company, Platinum Infosystems. It was a true blue IBM business partner.
In the first year of operations, Platinum Infosystems did business worth Rs 5 crore (Rs 50 million) and also won the 'IBM Business Partner of the Year' award. Sadhana's people skills were now in full bloom. Around the same time, she began consulting with Focus Infotech and joined the company as its chief marketing officer in December 2003.
In three years, the firm's revenues of Rs 9 crore (Rs 90 million) more than doubled. While Sadhana wouldn't tell us about her exact net worth, it is clear that her earnings from Platinum along with her pay in Focus, which, in all likelihood, would be having a key performance-based component, would have made her a member of the crorepati club by now.
She can now indulge herself in her hobbies of horse riding and collecting antiques.
6. Constant Learning
Catwoman Eartha Kitt in the TV series Batman once crooned, "I'm learning all the time. The tombstone will be my diploma." Ordinary people who finish rich use Kitt's philosophy to the hilt.
One example is Arvind T., 34, business head, MeritTrac Services, a skills assessment company.
After an MBA from IIM Lucknow in 1995, Arvind joined RPG as a management trainee at a salary of Rs 1.6 lakh (Rs 160,000) a year. "The atmosphere and the opportunity to learn is great at RPG. They ensure that the trainees get an all-round view of their functional area," says Arvind, who soon got a chance to work in different companies of the RPG Group, including RPG Cellular, RPG Cable and HMV (the music arm of RPG).
He remained a management trainee for about a year and slowly moved up the ladder, getting promoted from assistant manager to manager, sales. When he finally quit RPG after four years to join GE, he had become branch manager and had an annual pay of around Rs 4-5 lakh (Rs 400,000-500,000).
The exit trigger: new learning opportunities. "Every assignment was a challenge as you needed to complete them with the least amount of resources. This gave me lot of opportunity to innovate on the job," says Arvind of his stint at GE. Although Arvind was enjoying his work at GE, he wanted to gain international experience. So after four years at GE, he joined a small Singapore-based trading firm that promised him international exposure.
By now, the learn-and-earn bug in Arvind helped him draw an annual pay cheque of Rs 40 lakh (Rs 4 million). Soon, he recast his eyes on India -- the economy was booming and everyone wanted a piece of the growth pie.
"I did not want to miss the action," says Arvind. He took a huge cut in his salary and returned to India to MeritTrac in early 2006. "I was given the task of setting up a division and making it functional. There was no limit to what I could do," says Arvind.
Unlimited learning opportunities were guiding him again to higher earnings. Arvind's strategy to enter the crorepati club is simply this: accumulate a wide range of experience now for higher future earnings.
The six qualities we have gleaned from the stories of six individuals shed light on the behavioural basics that form the foundation of wealth creation.
Of course, you still have to adhere to the financial basics. Does this mean that wealth is guaranteed if you have these qualities? Unfortunately not, since no defined formula yields wealth. However, building blocks are clearly identifiable. Once you have them, you can combine them skilfully to immensely enhance your probability of hitting the bull's-eye.
(Source: http://us.rediff.com/money/2006/sep/18perfin.htm?q=tp&file=.htm)
Thursday, September 14, 2006
How to get the salary you want
So, you've done your research and prepared extensively for the job interview. You have produced the perfect CV and cover letter. You have even practised answers to common interview questions. You are dressed right, have your references, and are on time.
But, have you prepared for that critical salary negotiation with human resources managers? If the answer is no, all that effort could go to waste. Here's what you need to keep in mind:
How much do you earn?
As simple as it sounds, most people don't know their financial status well enough. Write down your basic salary and add up all the benefits. Your current employer may be providing you free food, transportation and medical allowances. If these are not part of the benefits offered, you need to demand a higher basic salary to compensate for them.
Collect salary data
You can gather information about a salary range for any position through trade publications, industry associations, a network of friends and consultants. For instance, Business Today publishes annual salary surveys based on industries and positions.
What do you want?
Break your expectations into three categories -- money, benefits and hygiene factors -- and jot down your expectations against each. Money would include salary, incentives, bonuses and stock options. Benefits would include company car, travel, relocation expenses, etc. Hygiene factors would comprise job title, training, exposure, international travel, etc.
This will allow you to stay flexible and also provide alternatives to the employer during negotiation.
Do your homework
Get some basic facts about the overall state of the industry in which you are applying. A booming or sunrise industry will offer better packages. Check the company's profitability and market position. If you have friends in the company, try and find out the urgency to fill the particular vacancy. More information will give you an edge during salary negotiation.
During the interview
Many employers will throw the salary question in the middle of an interview. The trick is that most candidates are likely to agree on a lower salary figure due to their anxiousness to crack the interview. So, delay talking about compensation as far as possible. Say something like, 'I am keen on this role and your organisation, but I'd like to hold on to salary discussions until we are both sure that I'm right for this job.'
Negotiate the basic salary first
Many HR managers will try to engage you into discussing benefits and perks before getting to a consensus on basic salary. This gives the HR manager leverage in justifying why your basic salary should be lower. Always agree on the basic salary first, then move on to perks and other non-monetary benefits.
Get the lowdown on benefits
Benefits can often go up to 25 per cent of your total package. Do get details on medical and life insurance, travel allowance, pension plans, educational assistance programs, overtime allowance, dependant care for parents/spouse, paid holidays, profit sharing and stock options.
Keep selling
Continue selling yourself throughout the negotiation process. Keep reminding the employer of the impact you will make, the problems you will solve, revenue you will generate and unique skills and talents you bring to the table. Highlight your interest and enthusiasm to work for the organisation.
Wait for 24 hours
Don't rush into accepting any offer on the spot, no matter how lucrative. In fact, a good idea is to buy some time. Tell the HR manager that you are interested in working for the organisation and will need about 24 hours to consider the offer. Think about it - you will be spending 8 to 10 hours a day at the new job, so a 24-hour wait is worth it.
Relocation
Make sure you include factors like the cost of living, relocation expenses, housing and travel in your package, if you will be moving to a new city for the job.
What if you're a fresher?
Don't be so excited about being offered a job that you end up accepting anything. Ask questions about promotional opportunities, performance reviews and the kind of salary progression that can be expected in a year or two.
End on a positive note
The last step of salary negotiation is to set the groundwork for what kind of performance will lead to a larger raise or promotion in the near future. Talking about future performance and expectations will make a positive impression and help you end the negotiation on a positive note.
Get it in writing
Make sure you see everything you agreed upon with the HR manager in writing before you finally sign the offer letter. The last thing you want is a nasty surprise a month down the line.
That's all you need to negotiate your way to a fat package!
(Source: http://www.rediff.com/getahead/2006/aug/24salary.htm)
But, have you prepared for that critical salary negotiation with human resources managers? If the answer is no, all that effort could go to waste. Here's what you need to keep in mind:
How much do you earn?
As simple as it sounds, most people don't know their financial status well enough. Write down your basic salary and add up all the benefits. Your current employer may be providing you free food, transportation and medical allowances. If these are not part of the benefits offered, you need to demand a higher basic salary to compensate for them.
Collect salary data
You can gather information about a salary range for any position through trade publications, industry associations, a network of friends and consultants. For instance, Business Today publishes annual salary surveys based on industries and positions.
What do you want?
Break your expectations into three categories -- money, benefits and hygiene factors -- and jot down your expectations against each. Money would include salary, incentives, bonuses and stock options. Benefits would include company car, travel, relocation expenses, etc. Hygiene factors would comprise job title, training, exposure, international travel, etc.
This will allow you to stay flexible and also provide alternatives to the employer during negotiation.
Do your homework
Get some basic facts about the overall state of the industry in which you are applying. A booming or sunrise industry will offer better packages. Check the company's profitability and market position. If you have friends in the company, try and find out the urgency to fill the particular vacancy. More information will give you an edge during salary negotiation.
During the interview
Many employers will throw the salary question in the middle of an interview. The trick is that most candidates are likely to agree on a lower salary figure due to their anxiousness to crack the interview. So, delay talking about compensation as far as possible. Say something like, 'I am keen on this role and your organisation, but I'd like to hold on to salary discussions until we are both sure that I'm right for this job.'
Negotiate the basic salary first
Many HR managers will try to engage you into discussing benefits and perks before getting to a consensus on basic salary. This gives the HR manager leverage in justifying why your basic salary should be lower. Always agree on the basic salary first, then move on to perks and other non-monetary benefits.
Get the lowdown on benefits
Benefits can often go up to 25 per cent of your total package. Do get details on medical and life insurance, travel allowance, pension plans, educational assistance programs, overtime allowance, dependant care for parents/spouse, paid holidays, profit sharing and stock options.
Keep selling
Continue selling yourself throughout the negotiation process. Keep reminding the employer of the impact you will make, the problems you will solve, revenue you will generate and unique skills and talents you bring to the table. Highlight your interest and enthusiasm to work for the organisation.
Wait for 24 hours
Don't rush into accepting any offer on the spot, no matter how lucrative. In fact, a good idea is to buy some time. Tell the HR manager that you are interested in working for the organisation and will need about 24 hours to consider the offer. Think about it - you will be spending 8 to 10 hours a day at the new job, so a 24-hour wait is worth it.
Relocation
Make sure you include factors like the cost of living, relocation expenses, housing and travel in your package, if you will be moving to a new city for the job.
What if you're a fresher?
Don't be so excited about being offered a job that you end up accepting anything. Ask questions about promotional opportunities, performance reviews and the kind of salary progression that can be expected in a year or two.
End on a positive note
The last step of salary negotiation is to set the groundwork for what kind of performance will lead to a larger raise or promotion in the near future. Talking about future performance and expectations will make a positive impression and help you end the negotiation on a positive note.
Get it in writing
Make sure you see everything you agreed upon with the HR manager in writing before you finally sign the offer letter. The last thing you want is a nasty surprise a month down the line.
That's all you need to negotiate your way to a fat package!
(Source: http://www.rediff.com/getahead/2006/aug/24salary.htm)
The Shanghai Taxi Driver's MBA Lecture
I needed to go from Xujiahui to the airport, so I hurriedly concluded a meeting and I was looking for a taxi in front of the Meiluo building. A taxi driver saw me and very professionally came in a straight line and stopped right in front of me. Thus followed the story that astonished me greatly as if I had attended a lively MBA course. In order to faithfully preserve the intent of the taxi driver, I have tried to reproduce his original words according to my memory.
"Where do you want to go? Good, the airport. At Xujiahui, I loved to get business in front of the Meiluo building. Over here, I only work two places: Meiluo building and Junyao building. Did you know? Before I picked you up, I circled around Meiluo building twice before I saw you! People who come out of office building are definitely not going to some place nearby ...."
"Oh? You have a method!" I agreed.
"A taxi driver must also have scientific methods," he said. I was surprised and I got curious: "What scientific methods?"
"I have to know statistics. I have made detailed calculations. Let me tell you. I operate the car 17 hours a day, and my hourly cost is 34.5 RMB ..."
"How did you arrive at that?" I asked
"You calculate. I have to pay 380 RMB to the company each day for the car. The gas is about 210 RMB. I work 17 hours per day. On an hourly basis, the fixed cost is the 22 RMB that I give to the taxi company and an average of 12.5 RMB per hour in gasoline expenses. Isn't that 34.5 RMB?" I was a bit surprised. I have taken taxis for ten years, but this is the first time that a taxi driver has calculated the costs this way. Previously, the taxi drivers all tell me that the cost per kilometer was 0.3 RMB in addition to the total company fee.
"Costs should not be calculated on a per-kilometer basis. It should be calculated on an hourly basis. You see, each meter has a 'review' function through which you can see the details of the day. I have done a data analysis. The averarge time gap between customers is seven minutes. If I started counting the costs when someone gets in, it is 10 RMB for about 10 minutes. That means each 10 RMB customer takes 17 minutes of time, which costs 9.8 RMB (=34.5 x 17 / 60). This is not making money! If we say that customers who want to go to Pudong, Hangzhou or Qingpu are like meals, then a 10 RMB customer is not even a bite of food. You can only say that this is just a sprinkle of MSG."
Great! This driver did not sound like a taxi driver. He seemed more like an accountant. "So what you do then?" I was even more interested and I continued my questioning. It looked like I was going to learn something new on the way to the airport.
"You must not let the customer lead you all over the place. You decide what you want to do based upon the location, time and customer." I was very surprised, but this sounded significant. "Someone said that the taxi driving is a profession that depends on luck. I don't think so. You have to stand in the position of the customer and consider things from the customer's perspective." This sounded very professional, and very much like many business management teachers who say "put yourself in others' shoes."
"Let me give you an example. You are at the entrance to a hospital. There is someone holding some medicine and there is someone else holding a wash basin. Which person will you pick up?" I thought about it and I said that I didn't know.
"You take the one with the wash basin. If you have a minor complaint that you want to be examined and to get some medicine, you don't usually go to a faraway hospital. Anyone who is carrying a wash basin has just been discharged from the hospital. When people enter the hospital, some of them die. Today, someone on the second floor dies. Tomorrow, someone on the third floor dies. Those who make it out of the hospital usually have a feeling of having been given a second life and they recognize the meaning of life again -- health is the most important thing. So on that day, that person told me, "Go ... go to Qingpu." He did not even blink. Would you say that he wanted to take a taxi to People's Plaza to transfer to the Qingpu line subway? Absolutely not!"
I began to admire him.
"Let me give you another example. That day at People's Plaza, three people were waving at me. One was a young woman who had just finished shopping and was holding some small bags. Another was a young couple who were out for a stroll. The third one was a man who wore a silk shirt and a down jacket and holding a notebook computer bag. I spent three seconds looking at each person and I stopped in front of the man without hesitation. When the man got in, he said: 'Yannan Elevated Highway. South North Elevated Highway ....' Before even finishing, he could not help but ask, 'Why did you stop in front of me without hesitating? There were two people in front. They wanted to get on as well. I was too embarrassed to fight with them.' I replied, 'It is around noon and just a dozen or so minutes before one o'clock. That young woman must have slipped out at noon to buy something and I guess that her company must be nearby. That couple are tourists because they are not holding anything and they are not going to travel far. You are going out on business. You are holding a notebook computer bag, so I can tell that this is business. If you are going out at this time, I guess that it would not be too close.' The man said, 'You are right. I'm going to Baoshan.'"
"Are those people wearing pajamas in front of supermarkets or subway stations going to travel far? Are they going to the airport? The airport is not going to let them enter."
That makes sense! I was liking this more and more.
"Many drivers complain that business is tough and the price of gas has gone up. They are trying to pin the cause down on other people. If you keep pinning the cause on other people, you will never get any better. You must look at yourself to see where the problem is." This sounds very familiar. It seems like "If you cannot change the world, then you should change yourself" or perhaps a pirated copy of Steven Corey's "Circles of Influence and Concern." "One time, on Nandan Road, someone flagged me down and wanted to go to Tianlin. Later on, someone else flagged me down on Nandan Road and he also wanted to go to Tianlin. So I asked, 'How come all you people who come out on Nandan Road want to go to Tianlin?' He said, 'There is a public bus depot at Nandan Road. We all take the public bus from Pudong to there, and then we take the taxi to Tianlin. So I understood. For example, you look at the road that we just passed. There are no offices, no hotels, nothing. Just a public bus station. Those people who flag down taxis there are mostly people who just got off the public bus, and they look for the shortest road for a taxi. People who flag down taxis here will usually ride not more than 15 RMB."
"Therefore, I say that the attitude determines everything!" I have heard dozens of company CEO's say that, but this was the first time that I heard a taxi driver say that.
"We need to use scientific methods and statistics to conduct business. Those people who wait at the subway exits every day for business will never make money. How are you going to provide for your wife and kids at 500 RMB a month? This is murder? This is slowly murdering your whole family. You must arm yourself with knowledge. You have to learn knowledge to become a smart person. A smart person learns knowledge in order to become a very smart person. A very smart person learns knowledge in order to become a genius."
"One time, a person wanted a taxi in order to get to the train station. I asked him how he wanted to go. He told me how to get there. I said that was slow. I said to get on the elevated highway and go this other way. He said that it was a longer way. I said, 'No problem. You have experience because you go that way frequently. It costs you 50 RMB. If you go my way, I will turn off the meter when it reaches 50 RMB. You can just pay me 50 RMB. Anything more is mine. If you go your way, it will take 50 minutes. If I go my way, it will take 25 minutes.' So in the end, we went my way. We traveled an additional four kilometers but 25 minutes quicker. I accepted only 50 RMB. The customer was very delighted for saving about 10 RMB. This extra four kilometers cost me just over 1 RMB in gas. So I have swapped 1 RMB for 25 extra minutes of my time. As I just said, my hourly cost is 34.5 RMB. It was quite worthwhile for me!"
"In a public taxi company, an ordinary driver takes three to four thousand RMB home per month. The good driver can get around five thousand. The top driver can get seven thousand RMB. Out of the 20,000 drivers, there are about two to three who can make more than 8,000 RMB a month. I am one of those two or three. Furthermore, it is very stable without too much fluctuation."
Great! By this point, I admired this taxi driver more and more.
"I often say that I am a happy driver. Some people say, 'That's because you earn a lot of money. Of course, you must be happy.' I tell them, 'You are wrong. This is because I have a happy and active mind, and that is why I make a lot of money.'"
What a wonderful way to put it!
"You have to appreciate the beauty that your work brings. Stuck in a traffic jam at People's Plaza, many drivers complain, 'Oh, there's a traffic jam again! What rotten luck!' You must not be like that. You should try to experience the beauty of the city. There are many pretty girls passing by. There are many tall modern buildings; although you cannot afford them, you can still enjoy them with an appreciative look. While driving to the airport, you can look at the greenery on both sides. In the winter, it is white. How beautiful! Look at the meter -- it is more than 100 RMB. That is even more beautiful! Each job has its own beauty. We need to learn how to experience that beauty in our work."
"Ten years ago, I was a general instructor at Johnson's. Eight years ago, I had been the department manager for three different departments. I quit because there was no point in making three or five thousand a month. I decided to become a taxi driver. I want to be a happy driver. Ha ha ha ..."
When we arrived at the airport, I gave him my business card and said, "Are you interested in coming this Friday to my office and explain to the Microsoft workers about how you operate your taxi? You can treat it as if your meter is running at 60 kilometers per hour. I will pay you for the time that you talk to us. Give me a call."
Then I began to write down his lively MBA lecture on the airplane.
"Where do you want to go? Good, the airport. At Xujiahui, I loved to get business in front of the Meiluo building. Over here, I only work two places: Meiluo building and Junyao building. Did you know? Before I picked you up, I circled around Meiluo building twice before I saw you! People who come out of office building are definitely not going to some place nearby ...."
"Oh? You have a method!" I agreed.
"A taxi driver must also have scientific methods," he said. I was surprised and I got curious: "What scientific methods?"
"I have to know statistics. I have made detailed calculations. Let me tell you. I operate the car 17 hours a day, and my hourly cost is 34.5 RMB ..."
"How did you arrive at that?" I asked
"You calculate. I have to pay 380 RMB to the company each day for the car. The gas is about 210 RMB. I work 17 hours per day. On an hourly basis, the fixed cost is the 22 RMB that I give to the taxi company and an average of 12.5 RMB per hour in gasoline expenses. Isn't that 34.5 RMB?" I was a bit surprised. I have taken taxis for ten years, but this is the first time that a taxi driver has calculated the costs this way. Previously, the taxi drivers all tell me that the cost per kilometer was 0.3 RMB in addition to the total company fee.
"Costs should not be calculated on a per-kilometer basis. It should be calculated on an hourly basis. You see, each meter has a 'review' function through which you can see the details of the day. I have done a data analysis. The averarge time gap between customers is seven minutes. If I started counting the costs when someone gets in, it is 10 RMB for about 10 minutes. That means each 10 RMB customer takes 17 minutes of time, which costs 9.8 RMB (=34.5 x 17 / 60). This is not making money! If we say that customers who want to go to Pudong, Hangzhou or Qingpu are like meals, then a 10 RMB customer is not even a bite of food. You can only say that this is just a sprinkle of MSG."
Great! This driver did not sound like a taxi driver. He seemed more like an accountant. "So what you do then?" I was even more interested and I continued my questioning. It looked like I was going to learn something new on the way to the airport.
"You must not let the customer lead you all over the place. You decide what you want to do based upon the location, time and customer." I was very surprised, but this sounded significant. "Someone said that the taxi driving is a profession that depends on luck. I don't think so. You have to stand in the position of the customer and consider things from the customer's perspective." This sounded very professional, and very much like many business management teachers who say "put yourself in others' shoes."
"Let me give you an example. You are at the entrance to a hospital. There is someone holding some medicine and there is someone else holding a wash basin. Which person will you pick up?" I thought about it and I said that I didn't know.
"You take the one with the wash basin. If you have a minor complaint that you want to be examined and to get some medicine, you don't usually go to a faraway hospital. Anyone who is carrying a wash basin has just been discharged from the hospital. When people enter the hospital, some of them die. Today, someone on the second floor dies. Tomorrow, someone on the third floor dies. Those who make it out of the hospital usually have a feeling of having been given a second life and they recognize the meaning of life again -- health is the most important thing. So on that day, that person told me, "Go ... go to Qingpu." He did not even blink. Would you say that he wanted to take a taxi to People's Plaza to transfer to the Qingpu line subway? Absolutely not!"
I began to admire him.
"Let me give you another example. That day at People's Plaza, three people were waving at me. One was a young woman who had just finished shopping and was holding some small bags. Another was a young couple who were out for a stroll. The third one was a man who wore a silk shirt and a down jacket and holding a notebook computer bag. I spent three seconds looking at each person and I stopped in front of the man without hesitation. When the man got in, he said: 'Yannan Elevated Highway. South North Elevated Highway ....' Before even finishing, he could not help but ask, 'Why did you stop in front of me without hesitating? There were two people in front. They wanted to get on as well. I was too embarrassed to fight with them.' I replied, 'It is around noon and just a dozen or so minutes before one o'clock. That young woman must have slipped out at noon to buy something and I guess that her company must be nearby. That couple are tourists because they are not holding anything and they are not going to travel far. You are going out on business. You are holding a notebook computer bag, so I can tell that this is business. If you are going out at this time, I guess that it would not be too close.' The man said, 'You are right. I'm going to Baoshan.'"
"Are those people wearing pajamas in front of supermarkets or subway stations going to travel far? Are they going to the airport? The airport is not going to let them enter."
That makes sense! I was liking this more and more.
"Many drivers complain that business is tough and the price of gas has gone up. They are trying to pin the cause down on other people. If you keep pinning the cause on other people, you will never get any better. You must look at yourself to see where the problem is." This sounds very familiar. It seems like "If you cannot change the world, then you should change yourself" or perhaps a pirated copy of Steven Corey's "Circles of Influence and Concern." "One time, on Nandan Road, someone flagged me down and wanted to go to Tianlin. Later on, someone else flagged me down on Nandan Road and he also wanted to go to Tianlin. So I asked, 'How come all you people who come out on Nandan Road want to go to Tianlin?' He said, 'There is a public bus depot at Nandan Road. We all take the public bus from Pudong to there, and then we take the taxi to Tianlin. So I understood. For example, you look at the road that we just passed. There are no offices, no hotels, nothing. Just a public bus station. Those people who flag down taxis there are mostly people who just got off the public bus, and they look for the shortest road for a taxi. People who flag down taxis here will usually ride not more than 15 RMB."
"Therefore, I say that the attitude determines everything!" I have heard dozens of company CEO's say that, but this was the first time that I heard a taxi driver say that.
"We need to use scientific methods and statistics to conduct business. Those people who wait at the subway exits every day for business will never make money. How are you going to provide for your wife and kids at 500 RMB a month? This is murder? This is slowly murdering your whole family. You must arm yourself with knowledge. You have to learn knowledge to become a smart person. A smart person learns knowledge in order to become a very smart person. A very smart person learns knowledge in order to become a genius."
"One time, a person wanted a taxi in order to get to the train station. I asked him how he wanted to go. He told me how to get there. I said that was slow. I said to get on the elevated highway and go this other way. He said that it was a longer way. I said, 'No problem. You have experience because you go that way frequently. It costs you 50 RMB. If you go my way, I will turn off the meter when it reaches 50 RMB. You can just pay me 50 RMB. Anything more is mine. If you go your way, it will take 50 minutes. If I go my way, it will take 25 minutes.' So in the end, we went my way. We traveled an additional four kilometers but 25 minutes quicker. I accepted only 50 RMB. The customer was very delighted for saving about 10 RMB. This extra four kilometers cost me just over 1 RMB in gas. So I have swapped 1 RMB for 25 extra minutes of my time. As I just said, my hourly cost is 34.5 RMB. It was quite worthwhile for me!"
"In a public taxi company, an ordinary driver takes three to four thousand RMB home per month. The good driver can get around five thousand. The top driver can get seven thousand RMB. Out of the 20,000 drivers, there are about two to three who can make more than 8,000 RMB a month. I am one of those two or three. Furthermore, it is very stable without too much fluctuation."
Great! By this point, I admired this taxi driver more and more.
"I often say that I am a happy driver. Some people say, 'That's because you earn a lot of money. Of course, you must be happy.' I tell them, 'You are wrong. This is because I have a happy and active mind, and that is why I make a lot of money.'"
What a wonderful way to put it!
"You have to appreciate the beauty that your work brings. Stuck in a traffic jam at People's Plaza, many drivers complain, 'Oh, there's a traffic jam again! What rotten luck!' You must not be like that. You should try to experience the beauty of the city. There are many pretty girls passing by. There are many tall modern buildings; although you cannot afford them, you can still enjoy them with an appreciative look. While driving to the airport, you can look at the greenery on both sides. In the winter, it is white. How beautiful! Look at the meter -- it is more than 100 RMB. That is even more beautiful! Each job has its own beauty. We need to learn how to experience that beauty in our work."
"Ten years ago, I was a general instructor at Johnson's. Eight years ago, I had been the department manager for three different departments. I quit because there was no point in making three or five thousand a month. I decided to become a taxi driver. I want to be a happy driver. Ha ha ha ..."
When we arrived at the airport, I gave him my business card and said, "Are you interested in coming this Friday to my office and explain to the Microsoft workers about how you operate your taxi? You can treat it as if your meter is running at 60 kilometers per hour. I will pay you for the time that you talk to us. Give me a call."
Then I began to write down his lively MBA lecture on the airplane.
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