Category — business

Check out this excellent compilation of 10 Inspiring Ted Talks for Startups http://www.readwriteweb.com/start/2010/07/ten-inspiring-ted-talks-for-st.php

I particularly like the talks # 6,7 and 9

Which ones to do you find most useful?

It’s been like really long since I blogged and despite trying to get myself to write I haven’t been able to. This quick post is a no brainer warm-up post to get me re-started on wordpress.

1) A super interesting read: Why Did So Many Successful Entrepreneurs and Startups Come Out of Paypal: Answered by Insiders

2) Soup Metrics: http://www.horsepigcow.com/2009/04/soup-metrics/

3) Hugh Macleod’s Random Thoughts on Being an Entrepreneur: http://gapingvoid.com/2010/02/28/random-thoughts-on-being-an-entrepreneur-2/

Customer Service would easily be one of the most oft used(and abused) words in Business. For some people, customer service means giving their customers the kind of experience they would like to get (as a customer) but for others(majority?) it’s a mere formality, a lip service that you have to offer just for the sake of it.

While customer service in itself is a big subject comprising numerous things including principles,  processes and much more, there’s a particular thing that I feel is amiss especially when it comes to online businesses, i.e. Personal Touch.

Personal Touch in customer service for online businesses is according to me a great value add given the fact that unlike offline businesses the customers are not talking to a company rep face to face or they can’t talk at length(or decide to wait in the company’s office) till their issue gets resolved. In fact Customer Service, especially over email, which is the most prominent way of offering Customer Service/Support is by design(asynchronous) a customer-unfriendly method. Given the fact that instead of talking to someone in person or over phone you are literally talking to a computer and unless the guys at other end make some real effort to add some personal elements things are bound to not be smooth.Adding Personal Touch to any non-verbal communication not only helps build credibility/trust but also ensures smooth resolution of any issues that a customer might have.

Over the last few months I’ve run into(online) customer service reps of various services including E-commerce and Mobile operators and almost NONE of them have what one can say Personal Touch in their customer service. As expected, almost all of them just work on a few standard templates which their customer service reps copy and paste. What further intrigues me is the fact that contrary to being Personal some of these online businesses try to be the opposite i.e. being as impersonal as they can be.

While this reply

is still acceptable, these ones

are completely unacceptable.
I completely fail to understand what is the ingenious thought behind hiding the identity of the person who is responding to these emails. Could it be the CEO/CTO/CFO himself?

Not only is the case of missing identity a big barrier in building any sort of rapport with the business it also complicates things as the customer never gets to know who was the person whom they last spoke to(over mail), who are they talking to now and how much do they already know about their issue.

It’s not Rocket Science that small things like how your customer service team addresses their customers (Dear Customer Vs Dear Mr Dhingra), the tone/format in which they talk or type emails(Pre-decided formats or customized replies), how they sign off their emails(Customer Service, XYZ.com or Shantanu, Post Sales Support, XYZ.com, Email:-, Ph:-) matter a lot. They especially matter a lot when you are an online business and even more so when you are just starting up.  BTW Dell India is an exception in this regard(at least)

Isn’t it great to actually see the “Full Name”(unlike just the first name) of the person who just mailed you back?
Isn’t it re-assuring to know that you also have their professional email id, telephone number and even extension in their email signature?

Besides other things, businesses should realize that by adding “Personal Touch” in their customer service, not only can they solve customer vows more quickly and efficiently, they can expect to get more/repeat business from them.

So having said all that, does your Customer Service have enough Personal Touch?

About a couple weeks back I happened to come to know about Mr Bala Balachandran from a friend of mine who also shared with me the printouts of an article titled “I firmly believe that all customers are not equal” that  appeared in Business Standard on 24th December 2002(couldn’t manage to find a link). It’s not often that one comes across this much business wisdom in a 4 page printout.

After giving that article a re-read yesterday, I searched a bit on Mr Bala Balachandran and amongst other things I stumbled upon this series of fantastic videos on everything from Cost Management to Customer Astonishment. This would by far be the best material on business I’ve come across in 2010 and the fact that these gems are hidden from the world is reflected in the fact that these videos had been viewed 2-5 times at max. It’s only now after repeated views from me that these numbers have jumped up . Also, Balachandran not only shares his business wisdom, he does so in a nice and funny manner. At 72, he has contagious energy and passion.

Only if someone could stitch these  small 2-3 minute videos together would they make into an amazing video.

This is a classic dilemma that many entrepreneurs(especially the offline one’s) are likely to run into. Customers as we all know come in all shapes and sizes(and mindsets). While there will be some customers who will talk nicely to you and your employees, pay their bills on time and offer you a piece of advice or feedback whenever needed, there’s also a bunch of customers that’ll act as if they are doing you a big favor by using your product or services, they’ll negotiate endlessly on the price and keep getting into endless debates about the most minute(and irrelevant) issues possible.

As an entrepreneur and consultant both I too have run into the thought of segmenting customers into good,bad and ugly but I am not completely convinced if that’s such a good idea. I mean on one hand there’s a thought of optimizing the whole thing for a better ROI on other hand there’s this idealistic thought that customers/clients should be treated fairly and equally irrespective of their spending powers and other behaviors. I for sure would like to get a fair/equal treatment in all the products and services that I use irrespective of the segment I belong to.
If you are committed to offering a delightful customer service the non-segmentation of your customers is highly likely to come in your way. As pointed by Seth Godin here

If you’re going to be obsessed with delighting customers, it’s a lot more efficient to focus on customers that are able to be delighted.

A case in point being if a particular bunch of customers is impossible or way too difficult to delight/please why waste your resources on them when you could focus ‘em on some other set of customers that are more likely to be delighted by what you are offering?

A few things I could think of that one needs to keep in mind if such a situation arises are

1. Is the customer bad or your offering?
   A situation like this can also be a opportunity to give your offering another in-depth look. Maybe the customer is right and there’s indeed a scope for offering a better solution at the same or reduced price or maybe the customer service offered isn’t up to the mark. So before branding a customer as a bad apple, give a second thought to their feedback and see if there’s a genuine problem there.
2. How would it affect the Word of Mouth?
   While not giving the same time, attention etc to a not so good customer might be a good utilization for your resources it might have a spill over effect. In cases like these it is also pragmatic to ensure that your segmented behaviour will not spiral into a bad WOM loop. To avoid that ensure that this bunch/segment are not influencers/thought leaders or highly connected individuals from your target segment. For ex: If you are targeting a product or service aimed at doctors and for some reason you decide to segment them, try to ensure that your segmentation policy will not spill over to other doctors and doctors as a community tend to be highly connected to each other
3. Customer Segmentation != Spending power segmentation
   While you’ll find plenty of real life instances in which retailers/suppliers and many more tend to treat customers with high spending powers differently, it’s not the most wise thing to do. When I started this discussion though I included “paying bills on time”  and negotiation I never mentioned spending power as the deciding factor. I strongly feel segmenting your customers based on just their spending power isn’t such a good idea
4. Do not do unto others as you would expect they should do unto you
   One should always keep “The Golden Rule” in mind before taking any call on customer segmentation. This will most certainly save you from some bad decisions

What do you think about treating different customers differently?

A while back I happened to share with a dear friend a small mistake I made and as expected I wasn’t particularly happy about it. It was then that he succinctly told me

Mayank, when you are doing something new/different you incur a “cost of learning”

If you think about it, it’s indeed true. When you start doing something new or different be it a business or some other activity, you make mistakes in form of bad investment, incompatible partners, unreliable suppliers, wrong decisions and more. So if you happen to make a mistake in something new that you are doing, don’t feel bad and simply think of it as a “Cost of Learning”, but having said that, always try to keep your “Cost of Learning” to the minimum

I’ve been a fan of 37signals ever since I first used Basecamp during my stint at Slideshare in 2007 and later while working on Kwippy. What’s also special about 37signals is that not only they build great products that make money, they are also doing a fabulous job at sharing their experiences and learnings with the community using Social Media long before it was a buzz word. If you haven’t done it already, you should checkout their blog where they talk about design, business and other things.

Sometime back I happened to listen to this talk given by DHH on ‘Making money online’. Despite a cheesy sounding title the talk is a great primer for web entrepreneurs  starting up or thinking of starting up. DHH touches upon a great point when he says

The odds of you in here making the next Facebook or YouTube or MySpace are tiny, the odds of you just actually just creating a product that few people will like and pay more for, not that shabby.

It’s kinda like reverse terror alerts, the probability of something like this happening, like the probability of you being crashed in the plane, tiny, but the fear you have of it or the desire you have to be the next Facebook, Huge, because it’s been broadcasted over and over again, you are being brainwashed

DHH further goes down to put forward the maths behind making a million dollars in an year by having  2000 customers and charging them 40$/month. Adding decent  conversion rate(5%) to the equation it would take about 40,000 signed up users to get 2000 paid customers. Taking it down one more level to make 200,000$ a year you would need just 400 customers at 40$/month.

The number of problems/niches one can attack trying to get this many customers are a lot, but not surprisingly we still find most web start-ups aiming at building the next Facebook or YouTube. Its not uncommon to find entrepreneurs by the dozen running after VCs and Angels to raise money for the next big thing on the internet despite the fact that most of them can get their venture started without too much money. One of the primary reason for this is the fact that raising million dollars for building(or the mere thought of) a global product that might be used by millions is SEXY however building a web product that’s being used by a few hundred or thousand users while making you some money isn’t.
This frenzy is fueled by media and consumers alike and the entrepreneurs(esp first timers) get unknowingly drawn into this trap and the next thing you know is everyone trying to make it big without even trying to taste success in building a smaller yet useful product.

While I won’t discourage anyone from taking big shots right from the start, I strongly feel its a lot better(and practical) to solve a small problem first before going for the bigger one.

Building a brand, product or an idea is like raising a child. You need to nurture and protect it during its early days and slowly set it free to grow. Sounds simple and obvious? Trust it me it’s not, at least for most people.

I’ve seen numerous cases of product(primarily web) founders, small businessmen and more falling into the trap of holding their product/business/idea too close to their hearts to let it grow, grow beyond them. Things are quite easy (in this context) during the initial stages with people putting their blood and sweat into their business and helping it stand on its feet and start walking. The real problem occurs in the next stage in which the business needs to start running not just walking.This is the stage where all sorts of conscious and unconscious forces come into play that tend to prevent the owner(s) to from letting their business/idea take the leap.

During the initial phases the business/idea is known more by the people behind it, both are synonymous with each other and that’s all that there is to it because the business is mostly driven by it’s promoters/founders, it’s known mostly in the promoters’ circle of friends  and is yet to grow and have an independent existence of it’s own. Once the business has firm grounding and more people start nurturing it directly or indirectly the pace and scope of its growth depends on how the core group of promoters loosen their strong ties with it.

Essentially it’s all about loosing the tight control and dependency that once the business had on its promoters because these factors now become the limiting force in its growth. The conflict that thus arises is a peculiar one in which the promoters still want to be involved as much as they were some time back in almost everything related to the business, while the business itself strives to outgrow its promoters. This is the stage where like a growing child the business needs to venture out, meet new people, develop new relationships, try new and different things not necessarily within the scope of its founders, in short this is the stage where the business needs to start getting a life of his own.

For some businesses it might mean raising funds, for some it might mean getting more people on board (not necessarily as employees who merely execute the promoters plans/ideas) and outsourcing a part of your business to someone else. The idea of loosing control is what troubles most promoters but the hard fact is that in order to make your business grow beyond you, you need to loose some control and this is what smart people realize.

The goal rather than trying to have your business as integrated as possible with its founders should be to let it loose as early as possible as only then the business can have a life of its own and it can grow into something big, much bigger than its promoters.

If you are an aspiring entrepreneur dabbling with questions like

What exactly is entrepreneurship all about?
What is the right time to start up your own venture?

or if you’ve already started up your venture and want to know

How to scale your business?,
How do really go about the whole funding business ? etc then TiEcon Delhi 2009 is the place for you to be.

TiEcon is one of the biggest conferences in India on entrepreneurship and is aimed at inspring and educating entrepreneurs on various aspects of entrepreneurship and the relevant growth opportunities.

TiE (The Indus Entrepreneurs), the organization behind TiEcon Delhi 2009 is a global not-for-profit organization dedicated to the advancement of entrepreneurship. With 53 chapters across 12 countries TiE’s mission is to foster entrepreneurship globally through mentoring, networking, and education. Dedicated to the virtuous cycle of wealth creation and giving back to the community, TiE’s focus is on generating and nurturing the next generation of entrepreneurs.

What differentiates TiEcon from other conferernces/events aimed at entrepreneurs is the fact that

1) TiEcon is at a much bigger level:

Some Numbers for Tie:

• 2,500 experienced entrepreneurs and business executives as charter members.
• 11,000 aspiring entrepreneurs and professionals as members.
• More than 500 events with over 70,000 attendees worldwide.

Given the scale at which TiE operates and the fact that the Shri P Chidambaram(Home Minister) would deliver the inaugural address for Tiecon Delhi 2009 it’s easy to imagine the scale of the event. The scale is also wide as unlike most other conferences aimed at entrepreneurs there aren’t really any restrictions on the size or kind of startups. For ex: There will be sessions on security and renewable sources of energy

2) Platform to meet the policy makers:

Another aspect that puts TiEcon in a different league is the fact here you can get a chance to interact with the policy makers for your segment/industry of interest.  This in itself is a great opportunity for entrepreneurs to interact and connect with people who decide various policies. For ex: A couple of speakers from government include Mr. Dinesh Rai, Secretary, Ministry of Micro Small & Medium Enterprises (MSME) and Mr. Deepak Gupta, Secretary, Ministry of New & Renewable Energy.

3) Exposure to other sectors/industries:

While the most an attendee can get to learn at a typical startup event is within the realm of that industry(tech mostly) but in an event like TiEcon one gets a great chance to learn more about other segments like Energy, CleanTech and Education.

4) Attendees:

Here’s a screenshot of some of the attendees/delegates.

You can find the complete list here

While I’ve shared just four reasons I am sure there will be a many more reasons for you to attend TiEcon Delhi 2009. Here are the details for TiEcon Delhi 2009

Dates: 18th and 19th September 2009
Venue: Hotel Taj Palace, New Delhi
Agenda: http://www.tiecon-delhi.org/agenda.asp
Registration:  http://www.tiecon-delhi.org/registration-group1.asp

The folks at TiE invited us(bloggers) to share more about TiE and TiEcon for a pre-event round table yesterday and were kind enough to offer free invites to attend the event

You can connect with TiEDelhi (Delhi chapter of TiE)

• on Twitter: http://twitter.com/TiEDelhi
• on Facebook: http://www.facebook.com/TiEDelhi?ref=ts
• on YouTube: http://www.youtube.com/user/TiEDelhi

Most people start their businesses in partnernships/collaboration with some one they know. It could be a family member, friend, relative or just a known too. Trust is the first thing that people look for before getting into a venture with other things being what the other person brings to the table; money, connections, skill set etc. It’s commonplace to find businesses being run in a fashion where one or more partners put the money(or maybe contacts) and other(s) put skills and effort(or maybe contacts).

Due to inherent nature of the factors in place(time, effort etc), things get a bit difficult at times as contributions start to vary from what they were initially agreed upon. For example: If two people start a business with one person putting the funds and infrastructure and the other bringing in clients and contacts needed to get the job done. Now in this case it’s easy to quantify the funds spent on infrastructure and other activities but it’s a bit difficult to quantify other inputs like efforts, time spent etc. What further makes the puzzle difficult is when both partners feel they are doing their share of the job as initally agreed upon.

A situation like this can easy reach a deadlock with both parties proclaiming to be doing their bit of the business. What further makes matter worse is if both the partners have agreed upon equal share in the profits. The matter gets really complex if  say the guy who was supposed to get business and contacts with his effort isn’t doing his part efficiently but believes he is doing it right and thus deserves and equal share in the profit(which they make due to the efforts of the other partner who was just supposed to put funds for infrastruce etc) as mutually agreed upon initially.

Human Ego is another factor in play in situations like these as even though a person might know that he isn’t putting in the required effort in the job but his ego will prevent him from accepting it and agreeing to get an unequal share in the profits. I’ve had a few direct and indirect experiences in this regard which have forced me to think of a way to reduce the possibility of such situations.

A couple possible solutions that I could think of  are

1) To partner with someone who is as equal as you are

If both partners are equal in most respects like finances, contacts etc then I think the scope of running into situations where  one feels the other isn’t doing enough is reduced. By quantifying one’s contribution in terms of money, contacts or other resources, the factors which could cause confusion/dissatisfaction are reduced. Also, I feel with equal partners it’s a bit easy to find out and accept if one isn’t doing his bit properly

So it’s a good idea to find out in the start what the other person is bringing to the table and ensure that it’s not too high or too low for your contribution.

2)  Decide on a profit sharing model based on one’s contribution:

In case of partners with unequal inputs, it’s a good idea to decide on different profit sharing models based on situations with varying contributions. For ex:

a) For every deal where person X does this and this and person Y does this, X gets 66% of the profit and Y gets 33%
b) For every deal where person X does this and person Y does this and this, Y gets 66%  of the profit and X gets 33%.
c) For every deal where person X does this and this and this and Person Y doesn’t do anything, X gets all the profit and vice-e-versa.

I feel predeciding things like revenue/profit sharing in various situations where there’s a possibility of unequal contributions will serve as a base and reduce the number of potential conflicts.

What do you think?