empressario_aug 2013

EMPRESSARIO

Innovations in Services Industry

August -2013

Vol. VIII Iss.2 IMT Hyderabad

Contents

Prarambh Speaks ......(1)

Send a Gift: Innovation in the gifting service …................(2)

At Your Service!! …................(7)

A Space for Every Woman …................(3)

Immersive Branding …................(9)

Innovations in IndianFood Industry …...............(11)The Vada Pav King - Jumbo King. …................(12)

Rise and Fall of a Visionary …................(14)

The Rise of Collaborative Consumption Services …................(5)

Wacky Ideas!!!

Monthly Features

The Readers’ Corner ..............(16)

IMT-H | Prarambh Empressario | August -2013

Add-onsTeam Prarambh

......(17)

Its time to rise...

IMT-H | Prarambh Empressario | August -2013 | Page 1

Prarambh Speaks

“Customer service is not a department, it’s everyone’s job.” - Anonymous

Team Prarambh

In business, we hear a lot of times that “the customer is always right”. This particular line is not just reverberated in the lower levels of a firm/store, but some of the biggest names in the world, some of the best first-generation entrepreneurs believe in.

Something related which some of the big names like Jeff Bezos, Sam Walton, etc. believe in is that the customer doesn’t look for perfection everywhere, but they look for experience, and the biggest weapon with them is the word of mouth. So that makes the sync between the marketing of experience and the actual experience utmost important.LaLast edition, we started off with Services Marketing, where we focused on the some

of the business ideas generated in-campus by the senior batch. We also mentioned that we would be continuing the same in the next volume. With focus on already implemented “Wacky” ideas in the same space, in this volume we would be continuing our discussion on the same theme but in a different way, by looking at some of the businesses which became successful and some that became failures for real. The focus is on a wide variety of businesses ranging from consultancy, food & beverage, process inninnovations, marketing innovations and the internet. Most of them are new upcoming businesses and one of them couldn’t go ahead as intended but serves in giving us the right lessons as future entrepreneurs.In the end we would again say that it is the customer who can be the judge, the jury

and executioner for you and your service. The customer can be ticked off by the slightest mismatch in promises and deliverance, and a customer has his/her own way of deciding your fate, which Brown & Williamson Tobacco understood and their ad reflected the same, as “I won’t complain. I just won’t come back”. How you can work your way around it is a major learning that your everyday business and competition teaches you. Finally, in the words of Ray Kroc, the man behind the success of McDonald’s,McDonald’s,

If you work just for money, you’ll never make it, but if you love what you’re doing and you always put the customer first, success will be yours.


Send a Gift:Innovation in the gifting service

Ruchir Mehta PGDM, IMT Hyderabad

IntroductionFour friends from Ahmedabad Rahul Saraf, Rohan Saraf, Ronak Agarwal and Pranay Gupta

came up with a beautiful concept of buddygifting.com, an online gift market, making the mode of gifting easy, explorable & qualitative.

Problem Statement:TheThere are many online stores providing online gifting, but in all of them either we are limited to

sending flowers or chocolates where there is a lack of availability of branded products or these stores are incapable of letting the recipient select the gift of his/her choice.

Solution offered: 1) The IdeaItIt basically is online gifting. The company have partnered with existing e-commerce websites &

brands like Flipkart, Fast-track, Footsy, Hidesign, Shoppers stop etc thereby saving in on inventory space & providing a lot more options to the recipient/gift provider.2) How It Works1. Select recipient - Select occasion and data - Choose gifts.2. An option of three gifts from which the recipient can make his choice/by gifting the voucher

the recipient can choose any item from the site.3.3. For group gifting, select friends from facebook/by email, make payment and provide some

personal message (if needed).In group-gifting a link would be provided to the friends where they can make contributions and amendments - redeeming by recipient.4. Irrespective of the location where all the gift providers (friends/colleagues) are; they can select

and contribute their part of the share.

The Target MarketSStudents, Employees or anyone who are away from their friends/colleagues/parents/relatives can gift them anywhere in India. Also anyone outside India can contribute in the gift.

Wacky Ideas!!!


A Space For Every Woman WomenSpace.in

Saketha Pingali PGDM, IMT Hyderabad

Launched by a group of students from Birla Institute of Technology-Pilani , WomenSpace.in is an interactive social media network that provides women from around the world, with a platform where they can share their daily life events and experiences and can get together in the form of virtual groups and provide help and advice to other women from around the globe on different issues affecting an individual or the women community as a whole.

Speaking with the members helped uncovering , the underlying idea behind the foundation of the website and its future prospects :

** What is the motivation to come up with this idea of a social networking site for women? What is the need that this website is fulfilling?

It’sIt’s not exactly a social networking site, it’s a knowledge sharing platform for women throughout the world. We often see a woman calling up a cousin, or a friend or a colleague to ask for advice on how to deal with her kids, or health issues or simply to ask for a recipe! Imagine, if she could get this advice from women throughout the world. On one platform and neatly categorized. The internet has made it possible to communicate with each other anywhere in the world and we are leveraging the same to provide this unique platform for women to share their experiences and knowledge! The site also helps women gain knowledge, have fun and gain recognition for their contributions which ththey could not have made if such an opportunity did not exist.


* How has been the progress so far and how do you plan to expand it ?

We have been working on the website since six months and after beta testing, the site was launched on August 1st, 2013. We received amazing feed-back from women primarily from Hyderabad and that is what is keeping us going. Currently, we are restricting our promotion only to Hyderabad as we want to improve the different sections on the site according to the feedbacks we receive and in a month’s time we will be looking to target the global women population.

** How do you attract talent in the initial stages of your business? What is the proposition that people will be inter-ested in?

Honestly, it is very difficult to attract talent in the initial stages of any business. They need to share the same vision and put in a lot of hours for pay and other benefits that might not match what corporates would offer. I would say we are lucky enough to have friends who believed in us and are talented enough to create such a platform. And of course we offer ESOP’s(Employee Stock Ownership Plan) to all the founding members.

* Leaving a job with a fancy package and starting with such a big project takes a lot of courage. How do you feel about it at this stage?

TheThere is a lot of risk involved in launching a business with no prior experience, but we started our services firm Pixelvide, which provides digital marketing and technology services to businesses while in college itself and there was a lot of learning during the same. So we were confident about running a business after college too and we knew, at 22, a person’s risk taking ability is a lot more than maybe even 5-6 years down the line when we are settled in a comfortable job. So there are absolutely no regrets.

* How do you plan to manage your finances in the initial years?

OnceOnce we reach our target number of users, we would look for venture capital to fund our initial expansion plan and improve technology.

The website has provided women around the world with a specially-tailored one of its kind platform where,apart sharing their daily life experiences, they can also discuss and raise various issues impacting the entire women community.


The Rise of Collaborative Consumption Services

Ashish Kalya PGP – 2, IIM Indore

Abhijeet DasPGP – 2, IIM Indore

Airbnb.com is one of the most talked about Entrepreneurial ventures of the recent times. It is a multi-sided platform that brings together people who want to put up rooms for accommodation and consumers want to make bookings. It started in August 2008 and by the end of 2012 it was a billion dollar company. It points to the potential of value creation due to collaborative consumption, a new service industry in itself which is growing.

CollaboCollaborative consumption is about sharing of access to products or services, without complete ownership. It is a case of time division of ownership among multiple participants. What has made this possible are the connections developed through the proliferation and penetration of social networks. It is the social capital that an individual has earned through social networks that reduces the information asymmetry and allows complete strangers to trust each other. It is not as if collaborative consumption didn’t exist earlier, it’s just that now there is a chance to scale it to levels unimagined earlier.

CollaboCollaborative consumption can be categorised to three types: Product Service systems, which enable companies to offer goods as a service rather than sell them as products, for e.g. Textbook rentals like Campusbookrentals, Redistribution markets, which enable moving used goods from somewhere they are not needed to somewhere they are, for e.g. used electronics like Gazelles. And lastly Collaborative Lifestyles, which enable people with similar needs and lifestyle to share and exchange assets through websites for e.g. Travel Portals (Airbnb). In all these segments, reputation is important as we need to deal with strangers whom we don’t know. Airbnb has features like review and and ratings as tools for the community to self-regulate the participants.


For collaborative consumption to take place, an enabling support structure has to be build and therein lays the opportunity for entrepreneurs. The value that will be created for participants is clear; you pay for what you use. However what needs to be ensured is that the process of participation shouldn’t be tiresome, cumbersome or hassling so as to dissuade the participants. Thus an entrepre-neur is needed who can design the systems while leveraging the social capital of participants, which will allow this and in some cases even go further and add more value.

Also it is a classic case of services management problem wherein behaviour management of customers is of utmost importance to deliver the service successfully. For example in case of Zipcar, what happens if a customer fails to return his car on time and another customer is left waiting?India has seen some action on this front. www.zoomcar.com has been launched in March 2013 in Bangalore which is trying to replicate Zipcar’s business model in India. Roomwale.com has tried to replicate Airbnb but with limited success. These are early days for collaborative consumption concepts in India; we are bound to see more action in the times to come. “The share economy will blow up the industrial model of companies owning and people consuming just as YouTube did with TV and blogs did with mainstream media”- Forbes

References 1. Beyond Zipcar : Collaborative Consumption , Rachel Botsman and Roo Rogers, HBR article, Oct 20102. The Share Economy, Forbes article, Feb 20133.3. nextbigwhat.com – Article titled –Roomwale wants to be the Airbnb of India


At Your Service !! An Article on Services Marketing

Seerat Jangda IIM-Lucknow

True to the maxim by Philip Kotler -“Marketing takes a day to learn. Unfortunately it takes a lifetime to master”. All the companies try to achieve the best marketing practices in this vicious world. They try to do the best possible job by catering to every one of the contemporary 7p’s of marketing namely – Product, Place, Price, Promotion, People, Process and Physical Evidence. Talking about the services sector in particular, it is going through a phase of rapid changes. A question to ponder here is why do we see the economies across the world inclining towards the seservice sector? Can there be an economy which derives its GDP based solely on services and nothing else? For example, we see a country like Malaysia which bases its economy almost solely on tourism.If we were to differentiate between services related products and non-services related products,

the first thing which is also the most important is the delivery which is a combination of Product, Place, People and Process. The nature of services being real time delivery leading to immediate consumption so to say is unique to services. Either you take the physical presence of the person delivering the service into account or the speedy processes that people want to see, both are important to services. If this takes more than the expected time, this causes ‘consumer dissonance’, whiwhich is an uncomfortable feeling and usually leads to the customer taking his money elsewhere or experiencing remorse over the purchase. The post purchase services and the aforementioned point forms an important part of Customer Relationship Management. For example, many auto dealers have separate vehicle servicing outlets to repair vehicles and offer free inspections of vehicles purchased from the said dealerships for the entire duration of ownership.


An example is Mad Over Donuts, where one can see his/her favorite donut being prepared. Similarly, this can be extended to car repair facilities where the service activity is fully visible through glass windows. Many of these backstage activities could be boring for some customers but to have an impact upon the customer, this is an important option to provide, catering to the 7th P (Physical Evidence).TheThe aforesaid points have been discussed with respect to the customer. The other component which complements the entire services system is ‘People’ i.e. the employees providing the service and the customers benefiting from it. Relationship with the seller is a major driver for purchase as the product is intangible. With the 7P’s in-place and the growing use of technology in every field, the nature of the service economy is bound to change.

Sources:http://jsr.sagepub.com/content/7/1/20http://alhttp://alexanderconsultingsbiz.com/art_s_m_challenge.htmlhttp://www.marketingprofs.com/topic/articles/services-marketingbx.businessweek.com/customer-service-marketing


Marketing –The Modern Way Immersive Branding

Neeraj Kumar PGDM- VGSOM- IIT Kharagpur

Merely engaging audience on Facebook and other social media in order to identify with the brand is just not enough in today’s highly competitive market-place.Today companies are not leaving any stone unturned to attract and retain customers. A step forward in this direction is to keep customers engaged through

‘Immersive-branding’.Gone are the days when companies used to attract customers just through attractive visuals and resonating messages.Today,they are taking an additional step to provide a larger-than-life brand experience.TheThe process offers a 360 degree experience that places one’s senses at the forefront of digital

technology, creating an image that is rich in engagement, offering a branding experience like no other. On the roll are like never before infectious campaigns, larger than life experiences and much more. In essence, the surreal beauty of brand landscaping is catapulted to such an extent that it casts a spell on the audience .MoMore precisely, it’s an effort where an arrangement is made to bring the customers, products,

services and the entire working environment on a common platform meant to leave an indelible mark on the psyche of the consumer .It’s like a theme party vouching for the brand. So how do marketers use Immersive branding? Companies tend to engross consumers attention by surrounding them with campaigns such assets for imaginary chocolate lands, doll wardrobes etc. Such a strategy helps the companies to attract the wholesome attention of consumers, giving them a closer to life experience.


Consider, for instance, smart phones and tablets industry, where brand differentiation is quite difficult as similar products are being compared .In such cases immersive digital experiences come quite handy for educating consumers on the value proposition of the product as well as cross-selling accessories.Nothing can be a substitute to a real life hands-on experience. This is the philosophy which is now-a-days being adopted by most of the companies. Interactive touchscreen and gesture control experiences provide customers with the ability to configure and personalize the products according to their needs.

Moreover,It is estimated that adopting immersive branding techniques will augment the sales figures of both the main and ancillary products substantially and will also increase the profit-margins . In short, we can say that Immersive-Branding is an initiative taken to revolutionize the entire branding concept and is gradually increasing its scope to include rural markets as well. However,how well it would be received by the segment at the bottom of pyramid is still a doubtful situation. But the value it is adding to ‘experiential marketing’ is definitely witnessing a metamorphosis.


Indian Food Service Industry: Innovations Required Shreya Dasgupta

PGDM, IMT Hyderabad

Food service industry is one of the most flourishing industries in the Indian service sector. The general exodus from the rural areas to the urban areas, changes in the lifestyle of masses and increase in income as well as consumption level of people is leading to a shift in food preferences, causing a sudden rise in demand in the food service sector. Moreover, working class people, who find it difficult to cook at home, resort to outside food with cost conscious people favouring the local fast food. With almost 84% of the food service sector being in the unorganized segment of the market, itit is quite obvious that there is a need to bring some serious innovations in this sector to draw the correct amount of benefit out of it. Recent studies have reported that most of the fast food consumers in India belong to the age group of 18-40 years. India, being a country comprising of more than 1.2 billion of population, it is very important to direct the much favoured fast food sector in a right direction i.e., transforming the junk food into light and healthy food at affordable prices reaching out to majority of people. Besides creating a safer platform for this, it is very important to mamake it a point to have an evenly spread expansion of this segment in all areas of our country as the population is highly scattered as of now. Due to the systematic growth of the food sector in all parts of the country, a better accessibility would create a general pattern of consumption, with people of same income class following the same trend of eating habits at a point of time. This, in turn, would reduce the scattered nature of consumption habits of the consumers. As far as innovation in food sector is concerned, we know that fast food is low in nutrition and high in saturated fat, sodium and calories.calories. Therefore, some alternatives should be looked for to convert this into a healthy intake. Taking a specific food item and preparing unique dishes out of it is a favourable way of creating a good market and if this happens to be an agricultural product, that adds a way lot of benefits over cost economically.For example, setting up small food chains specializing in soya bean dishes and products seems to be a good idea, since the local as well as the famous restaurants do not always offer a soya bean dish and it is not even very popular or frequently cooked in day to day household. This becomes a major factor for creating a craze for soya bean dishes. Soya bean is considered more like an oilseed rather than a pulse, though it has high protein content which is needed for animal body. Being a healthy food, it is easy to market it and creating different items out of it might attract people as it happens to be one of the most prpreferable food items in demand these days. Developing stores dealing only in soya bean products would bring multiple benefits to the economy as well. Since soya bean is an agricultural product, its increasing demand helps improve the living conditions of farmers by increasing their earnings. Moreover, being a healthy food item, it can provide the soya bean stores with a wide market. If the stores specialize in soya bean dishes, they can carve a niche market for themselves by serving the soya bean lovers with a variety of dishes. Now since this is an agro product, it can be obtained at a low cost. ThisThis implies that the price at which the soya dishes can be sold can also be affordable by majority of people if a nominal profit margin is considered, though the prices may vary with the type of dish. Hence, I would like to conclude by mentioning that innovations can be brought in an industry by focusing on a particular segment of the industry at a point of time and the development of an overall industry is dependent on the development of individual segments as a whole.


The Vada Pav King - Jumbo King

Amit Gunjan PGDM, IMT Hyderabad

“It is many things to many people -- it is simple, tasty, and yes, very cheap. But it is certainly not the stuff of dreams, especially the global kind.” – Dheeraj Gupta, Founder, Jumbo King.

IIronically, it wasn't the Mumbai's love of Vada Pav that initially inspired Dheeraj Gupta and his wife Reeta Gupta in 2001. Though biting the piping-hot treats of deep fried potato dumpling served in a lightly-buttered bun may be surging, Dheeraj's original impetus for Jumbo King’s Vada Pav was much more straightforward. Once he visited London to see his friend, who owned a Burger King Franchise. He was fascinated by the huge amount of profits the business was making. He was also inspired by ‘McDonald's: Behind the Arches’- A book by John F. Love, after which he started to give his thoughts a touch of Indian flavour and returned to Mumbai to open his first outlet named as ‘Chaat‘Chaat Factory’ near Malad Railway Station leaving behind his family owned business. Contrary to Vada Pav sold by hawkers, the Jumbo king Vada Pav is cooked in a state-of-the-art and hygienic system at every outlet. His strategic decision of reaching the higher mass by staying close to customers did cost him high rents but eventually it went on fetching higher returns as his large size product went popular winning the hearts of foodies.Eventually, there was a product available at almost every nook and corner of Mumbai, hugely

popular and started selling for as little as 5 INR. Later, Innovation too triggered to launch many new products.


Timeline of Jumbo King:

Today, Jumbo King runs like any other western fast-food giant, with standard operating procedures available for every area of operation. In terms of management strategies and decisions, it has a lot to its plate. Across all stores, the motto is the same: a simple food at an affordable price in clean surroundings.

HHaving been grown huge, this jumbo-sized success story today boasts to sell more than 9 crore Vada pav and have over fifty bright yellow and orange self-serve, fast-food branches spanning over various cities. Dheeraj’s ambitious project anticipates hitting more than 1000 outlets and targets billion dollars higher turnovers in years to come. This great insight with innovation in product delivery has helped this food chain in its heist to Zenith. Though faced threats by many competitors and challenge to bring the love for Vada Pav pan India, Jumbo King has been able to position itself well in the mamarket. Kudos to the enterprising Gupta couple for transforming the way Vada Pav is served in India today and I hope it is here to stay, to sail higher!!


RISE AND FALL OF A VISIONARY

Saketha Pingali PGDM, IMT Hyderabad

Information Technology era was the period when India suddenly witnessed high growth in service sector. IT had become the main interest of the country. Software industry saw a dramatic demand and firms increased their investment in information technology. So with the sudden boom supplemented with personal skill sets acquired over the years, V.V.V.Satyanarayana started a company named ‘Vortex technologies Ltd’ in the year 2000. The company focused on software products to cater Enterprise Project Management and Strategy Management. The product targeted Enterprise Project Management and initially showed successful results in the construction industry. InIn the initial period, the company targeted local markets within the state. Although they could expand to international markets once a strong customer base was formed. Within no time, the company progressed considerably. The product was based on Microsoft Technologies and Microsoft published their product on Microsoft’s marketing website as a case study. In 2002, their latest technology dot net was ranked among top ten in India by Microsoft. In 2005, the company received the “ACE” (award for customer excellence) from Microsoft. The product was purchased by Andhra Pradesh Legislative Assembly, for all their MLAs and MLCs to manage their constituencies. APAP irrigation developments, HMDA (Hyderabad Metro Development Authority) were few of the significant customers, who managed their projects using Vortex technologies’ product. Maytas, an infrastructure company managed their entire Strategy Management (6P 5R frame work similar to Balanced Scorecard) using their product.

VVV.Satyanarayana, an Electronics and Communications engineer, graduated in the year 1982. Throughout his career, he worked in teaching and manufacturing industry. He has hands-on experience in various functions of the organization which includes Quality Systems, Operations, Sales and Marketing. He also served as Regional Director of Microsoft (the highest recognition from Microsoft for Technology Specialists) for two years and received the most Valuable Professional award from Microsoft. He served as a Management Committee member of HYSEA (Hyderabad Software Exporters Association). He received Young Engineer of the Year (1995) award from Institute of EngineeEngineers, Vijayawada Chapter. He Spoke on software technologies and ERP on various Indian and international platforms. In 1999, it was relatively easy to start up the company as the market was booming, but sustainability was a serious challenge. The major challenges they faced were attrition of staff and sales. Being a small company, it faced difficulties in retaining the staff and it had become a training ground for big organizations. Potential customers always admired and appreciated the product, but when it came to buying it, they needed case studies to prove its working and efficiency.What led to closure of the company with such a good client base? “Society can take two roads - the road to genuine prosperity, oror the road to artificial stimulus. The first results in a permanent higher standard of living for all; the later creates inflationary boom that cannot last” –Mark Skousen. Initially when they started in 1999, they only looked at their personal strengths and opportunities in the market. Where did the company


lapse? They did not analyze deeply into their weaknesses and threats they were to face in the market. In fact there were indications in the market that it was going down in US, but they could not see through it. During 2000 dot com burst, the company suffered heavily, with the subsequent 9/11 and it took 5 years for the company to regain the initial level of operations. Survival became their prime motto. In the second phase i.e. 2005 to 2007, the company was relatively doing well and there were ex-cellent customer case studies. Everything looked optimistic and indications showed that they were goinggoing to grow big. But then in 2008, because of the infamous Lehman brother’s episode, the market suddenly became dry and everybody turned away from software. All organizations cut down their bud-gets that were meant for achieving their long term goals, and started focusing on continuity of present operations with conservation of money as the sole target. Cash became the King in that year. Vortex technologies Ltd, being manpower intensive industry, could not survive that phase and finally closed down in 2009. Just one episode changed the entire face of the company. Was it sheer negligence or inability to assess what was coming? ‘You should not put all your eggs in one basket’ holds good in few cases. They miscalculated and focused only on the product which was in a high risk zone and they did not cater time to diversify or add services in their portfolio. Their tunnel focus approach proved wrong for their time. “You can’t fuel a real economic growth with indiscriminate credit. You can only fuel it with well allocated long-term investment”-James Surowiecki. A company should rapidly grow (or start with that kind of money) to susurvive a few years without revenues. That is because the external environments (which are not under anybody’s control, like in the years 2000 and 2008) are changing unpredictably and if the organization narrows its focus only on a single area with limited resources, the cost of risk taking is very high. A core lesson to be learnt from the dot-com boom is that even if you have a good idea, it’s best not to grow too fast too soon. Presently, V.V.V.Satyanarayana is a group head – SAP at Lanco Infratech Ltd, gaining better insights on how a big organization works on strategies and operations as they need to provide solutions for both of them. He says there can be a restart, but that might be through the guidance of next generation.

(This article is based on an interview given by Mr. V.V.V.Satyanarayana to Prarambh)

Contents


Add-ons


Team Prarambh

Faculty MentorDr. Archana Pillai

Core Members

Editors

Editing Support

Prateek MukherjeePankaj Kumar GauravTanay KotriwalaHarsh Kapadia

Pankaj GauravPushkar GhatoleDeeptanshu Pande

Rohit SethAnshika Rai

Manish AgarwalSarang PiousDiwy Shukla

Designing,Compiling

& Tech Support

Vol. VIII Iss.2 | EMPRESSARIO | August 2013 | PRARAMBH | IMT Hyderabad

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