The Highlights of 36th AMP at ICLIF in Malaysia and INSEAD in Singapore
We reached Malaysia 0n Sunday i.e. 02-09-12 by MH 607. We stayed in Hotel
Renaissance and classes were held in JW Marriott in Kuala Lampur. In the
morning, we left hotel for class at 7:30. The class started at sharp 8. The first
session was on Leadership, Happiness and Success. It was taken by famous
CEO of ICLIF, Mr. Rajeeva Peshawaria and the author of “Too many bosses, too
few leaders”. He is internationally acclaimed and at present he is writing on the
implications of recent Neuroscience and Quantum Physics discoveries on
Leadership. He is a brilliant orator and the emphasis of his entire lecture was on
value driven success. He said, “Leadership is the art of harnessing human
energy towards the creation of a better future”. The role of a leader is to clarify
both the purpose and the value in order to find and harness the leadership
energy. It is an inside out paradigm. He also talked about the emotional
intelligence pioneered by Daniel Goleman. He also talked about how your brain
may have the power to influence other people and events i.e. linking
neuroscience with quantum physics. In the end he asked the participants to
answer six questions given by him honestly e.g. what will people say about you
and your life at your funeral tomorrow, etc.. Then we were introduced to the world
of business innovation and scenario thinking and use of scenario thinking and
scenario development for business innovation followed by Group Exercise by a
host of lecturers of ICLIF. They were equally brilliant. The focus of the rest of the
classes during the whole week revolved around these topics only. The focus of
business innovation is outside in paradigm i.e. you see your customer and
competitors as they are and not as you want them to be and then you try to
satisfy the need of your customer i.e. what they want and in order to satisfy their
needs you try to know what your competitors are doing particularly those who are
more successful than you are. Once you ascertain those factors, you try to adopt
them. It may be through imitation/copying/scanning or steeling. The art of
innovation lies in doing something different that has impact. It is a very good
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concept but the ethical dimension is missing. There is need to link this outside in
paradigm with ethics. I also had an opportunity to delve deeply into harnessing
the emotional energy of tem members (human element involved) during group
exercise. Some of the members may be indifferent and barely ready to
contribute. The others may be egoistic and stick to their point of view and not
ready to listen to others. The art lies in carrying all the group members together
by acting as a facilitator who is neither indulgent to any of the
unwarranted/irrelevant idea of any group member nor allow the group to reach a
solution which is untested and substandard.
Our stay in Kuala Lampur was comfortable and was taken care off well by the
organizers. On Wednesday i.e. 05-09-12, the organizers took us to Putra Jaya,
the political capital of Kuala Lampur. We had an outside view of the President’s
House there. Here the President is chosen for a period of 5 years by a limited
electoral college comprising the governors of all the thirteen provinces. The nine
provinces have Sultans/ Monarchs as their rulers and one of them is chosen on
rotation as president. President is a titular head here and the real power lies with
the Prime Minister. Once a Sultan is chosen president, he loses all his real power
which he used to exercise as ruler of a Province. Therefore, very few want to be
President. At Present, His Majesty Sultan Mu’azzam Shah, a 84 year old man is
the President of Malaysia. This is his second stint and he had his first stint as
resident in 1970s at the age of 46. Then we saw Prime Master’s Residence from
outside. We visited the national mosque in Putra Jaya. I had the chance to
participate in the funeral prayer (namaaz-e-janaza) of ex Sports Minister Late Mr.
Hamza Ismail in the mosque. We came back from Putra Jaya and had our dinner
at the Restaurant Olive Gold in Kuala Lampur hosted by the organizers in Kuala
Lampur. The dinner was very good.
Our classes ended on Friday i.e. 07-09-12. We were given our Certificate of
Participation by the faculty of ICLIF. We left hotel Renaissance on Saturday i.e.
08-9-12 in the morning. However, some of us stayed in hotel till the afternoon
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and they went directly to the Airport to catch their flight. The tour on Saturday
was sponsored by ICLIF. We first went to see a Cave which comprised Hindu
temples and their gods. We then went to the Genting Island. It has the one and
only Casino operated in Malaysia. It was built and is run by a family of Chinese
origin having Malaysian nationality. It is a marvel as it is on a
Certain height and entry to it mandates the use of Cable Cars run to climb
heights. The cable car takes you through these heights giving you a glimpse of
greenery and forest lying below. It is awfully beautiful. When you enter there, it is
full of fun and frolic and is a complete entertainment. There are indoor and
outdoor games/events and you can spend the whole day here participating in
these events. The most impressing event was a 4D movie shown on the life of a
little Prince which dates back to the origin of the world. We left for Airport at 5 PM
in the evening as our flight was scheduled for Singapore at 7:30 P.M. in the
evening. We reached Hotel Mandarin oriental in Singapore at 9:30 in the
evening.
In the morning on Sunday i.e. 09-09-12, we were taken to Sentosa. It is run by
the same family which owns Genting Island. It shows the Disney Movies
produced worldwide. It was a complete fun. The Transformer was thrilling and
the most entertaining. The Red and Blue Rides were completely awful as there
was a steep descent at a certain point and the speed was so terrific that almost
all the riders closed their eyes at that point. However, we couldn’t see the
Dolphin Show. In the evening we watched ‘Song of the Sea’ Laser show on the
beach. It was completely entertaining.
The classes started in INSEAD from 8 A.M. in the morning which meant 5:30
a.m. in India. They made us work up-to 5:30 to 6:00 P.M. in the evening. We had
some feedback on Mr. Amitava Chattopadhyay. He welcomed us in the morning
as Director of this programme. The apprehension that clouded our mind about
Mr. Amitava Chattopadhyay was clear after this address and as we interacted
with him more and more, we found him more and more a nice person. Professor
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Chattopadhyay holds a Ph.D. from the University of Florida, a PGDM from the Indian
Institute of Management, Ahmedabad, and a B.Sc. (Honours) degree from Jadavpur
University, India. Prof. Chattopadhyay has been a faculty member at The University
of British Columbia, Canada and McGill University, Canada prior to joining INSEAD.
Professor Chattopadhyay is an expert on branding. After this introductory session,
Mr. Jasjit Singh took over. Professor Jasjit Singh has been a member of the Strategy
faculty at INSEAD since 2004. He obtained his Ph.D. in Business Economics at
Harvard Business School. He spoke on fundamentals of Strategy followed by case
study of Airborne Express. He defined strategy as an exercise which involves unique
value creation through/via mutually consistent choices on:
a) Scope: Where to Compete?
b) Competitive Advantage: How to compete?
However, the fundamental question of ‘Why to compete?’ is missing here. I asked
this question and Mr. Singh agreed to my proposition. As I have discussed on the
issue of leadership, how it is critical to have a leadership which is focused on clarity
of purpose as well as values. It is the emphasis on ethical leadership which is
missing from Strategy and Innovation.
Value Creation may be defined as difference between:
a) CTD (Cost to Deliver) : Overall cost per unit of the product
b) WTP (Willingness to Pay): The value (in monetary terms) that the
customer attaches to one unit of the product or service i.e. the
maximum price the customer would ever pay for it.
Alternatively, Value Creation may be defined as value captured by Company (i.e. the
real profit) as well as the customer (i.e. the perception of the customer about its
utility and uniqueness which we call customer satisfaction). He illustrated it by the
example of Steinway, the top class and most expensive piano selling company in the
world. Its competitive advantage stems from the value proposition ‘best piano at any
cost’. It sells its piano @ $85000 per piano to the premium segment. Thus its
strategy is differentiation and not low cost. Interestingly no company including
Yamaha could beat it in the Premium segment.
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Thus Strategy may be summarized as replying to the following questions:
a) Why to compete? The reply should be clarifying both your purpose
and values. It is the leadership issue.
b) Where to Compete? The reply should be clarifying for what
markets or customers you strive to create unique value i.e. the gap
between WTP and CTD
c) How to compete? It may be the gap between your promise and
delivery.
d) Sustainability of Advantage: i.e. knowing your long term threats
and taking steps to mitigate them.
The rest of the session was spent in group exercise. The participants were divided
into random groups, sent to breakout rooms, discuss the case in hand (here it was
the Airborne Express) and then find a reply/solution to the problems in a time span of
nearly half an hour and then come back in the classroom and present them. Each
group was allowed to present up-to 5 minutes. This was the modus operandi
throughout the week. The composition of the groups was changed at frequent
intervals. After individual group presentations were over, the faculty gave its own
views/set of solutions on the case in hand.
The afternoon session was taken by Mr. Amitava Chattopadhyay on CRM
(Customer relationship management). The case study was on ISS, the largest
facility services group (office cleaning, catering, mailroom operations, building
maintenance, etc.). He gave an insight into CRM and opined that the strategy of
CRM hinges on asking two key questions namely:
a) What type of relationship do you want to have/develop with your
customers?
b) How do you manage these relationships?
He also opined that the relationship should be based on win win paradigm i.e. it
should be mutually beneficial and the sum total of VTC (Delivering value to the
customer) and VFC (getting value from the customer). The business objective is
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to maximize value from the customer over the customers’ lifetime by delivering
superior value to the customer. In the subsequent sessions spread over the week
Mr. Chattopadhyay deliberated on Customer Focused Strategies and Building
Strong Brands. In Customer Focused Strategies, the case study taken was the
DELL Online Case. He opined that the watchword for winning competitive
markets is to become customer/consumer focused and not competitor focused.
He corroborated it by using the report of the study conducted by him and his two
colleagues namely Mr. Dahl and Mr. Gorn in 2001. The study concluded that the
results were much better when visualization/imagination was based on
consumer/customer rather than the competitor. He illustrated as to how Indian
Railways has lost its share of freight and passenger to road and other transport
sectors during the last four decades. The key question to be asked is: Who are
our customers? Once we identify our customer, the next question to be asked is:
What are their needs and how do we meet them? One of the strategies may be:
a) Reorganization of IR on business lines instead of the present
functional structure.
b) Creation of Customer-focused units for different units of
business
c) Outsourcing of activities like maintenance and manufacturing as
done in other Railways.
d) Separation of infrastructure from operations.
The supplementary strategy may be:
a) Look for dissatisfied customers across the spectrum of
customers, potential customers and non customers and then to
identify a new way to configure segments based on a common
unmet need.
b) Focusing on the consumers’ decision making process including
the consumption done by them
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c) Identify the consumption basket of the decision making unit,
understand their role and motivation in decision making.
d) Provide only the features consumers want.
e) Be 100% consumer focused.
Mr. Chattopadhyay deliberated also on ‘Building Strong Brands’. According to
him, the brand may be defined as value proposition comprising the following:
a) Core values/services at the centre/core of three concentric
circles. It shouldn’t be more than 3 or 4.
b) Auxiliary Functional Benefits on the outer circle.
c) Emotional/Perceived benefits on the outermost circle.
And Brand Identity may be defined as set of associations that the legal owner of
the brand would like the consumers to have. Every brand will have a
differentiating value proposition e.g. if we take GE, the core values are:
a) Integrity
b) Performance
c) Change
Some of the Auxiliary Values are: Discipline, Passion, Growth, Leadership,
Change, Innovation, etc. The emotional benefits may be quality, reliability,
environment friendly, etc. The differentiating value proposition is: ‘Imagination at
work’.
In the end we were given the group exercise of building brands for IR. Any unit of
service, e.g. Shatabdi, Rajdhani, etc. was to be taken as brand for this exercise.
Our group took Shatabdi as brand and we identified the core, auxiliary and
emotional values of the brand. We also developed a differentiating value
proposition for our brand. Similar was the case with other groups.
Monica Wadhwa is an Assistant Professor of Marketing at INSEAD. She holds a
Ph.D. in Marketing from the Stanford University, US. She has also received a
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Masters in Human Resources Management from the Tata Institute of Social
Sciences in India and a Bachelor in Sociology (Honours) from Delhi University in
India. Her topic in our class was ‘dynamic pricing’. The case study taken by her
was Lufthansa Cargo AG. IR has to seriously consider dynamic pricing in order
to augment its dwindling revenue. The conditions of dynamic pricing are:
a) Fixed Capacity
b) Variable demand
c) Segmentable market
d) Limited arbitrage
e) Cost of implementation<Revenue benefit
Factors to be considered while implementing dynamic prices are:
a) Design price schedules and fences that are clear and logical
b) Price schedules should be perceived to be fair
c) Use high published prices and frame fences as discounts
d) Use service recovery to compensate for overbooking
e) Communicate consumer benefits of revenue management
Vibha GABA is an Associate Professor of Organizational Behavior at INSEAD,
and her core expertise is in the area of organizational change and innovation.
She holds a Ph.D. in Management from the University of Oregon, USA, a
Masters in Sociology from the Delhi School of Economics, and a Bachelors
degree in Economics from Delhi University, India. She has also worked as a
business journalist for a leading financial daily in India, and as a writer and
consultant for the Oxford University Press. Her topic was leading change and the
case study was ‘Project Pearl and Lucy Chin’. Leading change successfully and
ethically is one of the greatest challenges that we face today. Why people don’t
change in spite of knowing that change is inevitable? Here is an interesting
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example of how California was considered an island for almost 200 years. It was
in 19th century when it was finally discovered that California wasn’t an island. The
people who sailed there in 16th century were marred by sickening of their cru and
passengers on the sea. They had little provision left. They found water in almost
all directions. Finally they returned without visiting California and assumed that
California was an island. This fallacy happens because of the mental map that
we have ingrained in our mind. We resist changing it. According to Prof. Gaba,
there are three reasons as to why people resist change. These are called the
barriers to change. These are:
a) They fail to see
b) They fail to move
c) They fail to finish
How to overcome these barriers? According to her, these barriers can be
overcome in the following way:
a) Help people see by confronting the situation in hand and
contrasting it sharply with the desired outcome. It should be
done through imagery.
b) People fail to move even when they see the need for change
because they know they will do poorly at first. Many would
rather be competent at the wrong thing than incompetent at the
right thing.
The motivation to take on a new journey is a function of the
following three:
1. Clarity of Success: People are motivated when they know
what the target is.
2. Chance of success: People are motivated when they
believe they have the abilities, skills, knowledge, etc. to
hit the target.
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3. Outcome of success: People are motivated when they
believe outcomes they value will likely follow from
success.
c) People fail to finish they get tired and lost. Why so? They get
tired of trying but getting poor results and they get poor results
at first because they are never perfect at the new thing
(customer service, quality, remote management, teamwork,
etc.). Reverting to old ways and success is almost an irresistible
temptation.
1. Breaking through the habit of getting tired from early
change efforts is through ensuring that there are
champions at critical point.
2. People feel lost when they are not sure how far they have
come and how far there is yet to go. If they feel lost for
very long, they will quit putting effort into the change and
simply go into the security of old maps. This barrier can
be broken through communicating progress. It can be
done through:
I)
Charting: Chart progress individually and
collectively. Plan for, capture and celebrate
early wins. Share the good, bad and ugly.
II)
Communicating: People must know how they
and others are doing. What progress is being
made? Keep message simple and repeat
them often. Use multiple channels.
Last but not the least leading the change process comprises the following
steps:
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a) See the Need
1. Articulate what has changed that requires change.
2. Paint the picture of the vision.
b) Make the move
3. Build the leading team
4. Layout the path and bridges
5. Provide the tools and resources
c) Reinforce it to the finish
6. Reinforce early attempts and small successes.
7. Chart and communicate progress
8. Align and celebrate
Prof. Gaba also made us to do a simulation exercise on a case study involving
implementation of 6 sigma in an organization. The team was sent from the HQ to
lead the process of change in a division. The exercise lasted for more than two
hours and it was a thrilling experience. In the end, the group with the highest
score was given prize.
We had Night Safari in the evening on Tuesday and Dinner on Thursday.
Overall, the AMP was a source of great learning. It made us utilize every moment
of our time which I am trying to do since the last three to four years in my
personal life. The question is: ‘Shall we be able to transform this learning into
building organizational excellence in IR?’
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