Structured Spontaneity and Prepared Oratory: Cues for Immersive Communication Experiences

India has just seen a massive election with a transformative vote. Multiple parties attempted discourses and debates through their organizations and leaders but only a few eventually succeeded.  Social history teaches that logical discourse that appeals to broad masses determined the enlightenment of societies and organizations. Similarly, business history teaches us that organizations which are collaborative and communicative internally and externally achieve sustainable success. Societies and organizations require collaboration to succeed. Collaboration, in turn, needs communication to succeed. Communication is based on points of view which are exchanged in conversations or in writing. The success of communication, hence that of collaboration and the success of societies and organizations is dependent on the logic of views and their expression. Logic that is positive and sublime, like that of peace and prosperity, leads to enlightened development.

The adventurous ability to lead a sunrise industry or the competitive ability to dominate a fragmented market is based on the organizational ability to communicate within itself and with the outside world. From a corporate logo that conveys a common identity and purpose to business vision and strategy that convey a common theme, a viewpoint is consistently expressed by businesses. These tend to be institutional initiatives, well researched, well debated and well articulated. What adds to the strength and sparkle is the productivity of communication across the organization and within its broader ecosystem. Everyone has a point of view but not every point of view would be logical. Every view deserves to be expressed and listened to but rarely these processes are well accomplished; more people tend to be keen to express than listen. Business organizations can take several cues from political organizations on how organizational units can be structured, and discourses and debates accomplished to achieve aligned objectives.

Societies and organizations

Societies have several forums to communicate. In an electoral process, they vary from door-to-door word-of-mouth communication to massive road shows involving millions. Communication occurs through print as well as electronic media. Cumulative impact of governance or opposition lies embedded in social psyche. Yet, in a short span of one month, political parties are able to cover nearly a billion people to influence transformative voting pattern. Success in such marathon and daunting processes occurs through careful internal collaboration and calibrated external communication. A simple theme becomes as important as a complex manifesto and the style of communication becomes as important as substance of communication. When political leaders singularly achieve such mammoth tasks across nations there is no reason why managers and leaders should ignore the powerful impact of collaboration and communication across organizations.

The success of national political campaigns, irrespective of geography, is dependent on two sets of factors; the first set is issues and solutions while the second set is forums and cascades. Likewise, the success of business communication, irrespective of the firm, would also depend on issues and solutions on one hand and forums and cascades on the other. Unlike social forums, corporate issues, solutions, forums and cascades are more structured and continuous which has its own advantages and disadvantages. That said, it is somewhat strange that while millions of a nation could be swayed by national leaders to vote one way or the other, the few participants of a business forum tend to be diffident to efforts by managers and leaders to align and achieve. Clearly what works for social campaigns does not appear to work in terms of business campaigns. That is essentially because societies are willing to listen and follow certain themes of development while organizations tend to continuously second-guess  leadership and managerial themes.

Forums and cascades

The importance of forums and cascades is evidenced by the successes of political parties which have a strong hierarchy of organizational units and committed cadres. Here lies the important difference between how electoral processes are organized for political organizations and how leadership processes are organized for business units. The former, the savvy political organization, has committed leadership at the top and committed cadre base at the bottom, both thematically aligned, and in respect of some parties very well indoctrinated too. These two layers form a tight cone with a circle of connected cadres at the bottom and a leadership polestar at the apex, encapsulating an undecided population in cascading layers of thematic discourse, from the top as well as the bottom. The more diametrically larger the base of the thematic cone, the stronger is the grip on the voters. The top-down and bottom-up cascade make for perfect discourse. Whenever cadres lose their thematic fervor, the electoral cone becomes wobbly.

Business organizations over time have begun to eschew the classical pyramid structure and have started adopting  more square-like, or even multi-cornered, structures, which is quite different from evolution of political organizations from triangular structures to seamless, circle within circle, conical structures. Organizational design must be reassessed if thematic alignment is desired as an overriding goal. The loss in communication in totally top-down communication of business organizations is not well understood. A few all-hands auditorium meetings by themselves cannot address the challenge. Grassroots cadre indoctrination is vital. Japanese organizations accomplish this by putting their youngest employees through comprehensive company study programs and on the job training assignments, regardless of their individual functional specializations. As a result, what emerges is neither a functional personality nor an individual personality but an enterprise personality. When cadre becomes hand in hand seamlessly, the cone of alignment and achievement gets built up.

Points of view, logics of view

The other important difference between political organizations and business organizations is that in the former the leaders are elected while in the latter the leaders are selected. In the former, leaders have little opportunity to collaborate directly with the stakeholders  once the election process is over while in the latter leaders have the opportunity of direct interface with the stakeholders at all times. Business organizations thus provide a unique opportunity for discourse and debate all times. Organizations have the choice of accepting this intrinsic feature and leveraging it to unleash creative energy or fight shy of widespread discourse and debate in them. Though the benefits are recognized by them, organizations fumble at enabling discourse and debate, and eventually try to sidestep the whole process by reducing the process to directed meetings rather than freewheeling debates.

Organizations need to be empowering to enable individual points of view while individuals need to be responsible to support viewpoints with logics of view. Discourses and debates become unproductive when they are characterized by discreet silence or indiscrete rancor. Individuals who believe that silence is better to reflect their compliance would do well to remember that as team members they are morally and professionally contracted to give their best to their organizations, expression of their constructive thoughts is integral to the best. Individuals who tend to be rancorous to draw attention to themselves would do well to remember that as  team members they are morally and professionally contracted to be constructive and disciplined in their interactions. The point to note is that as long as individual viewpoints are supported by logic of views, other team members would be compelled to listen and respond.

Expressive listening

The hallmark of meaningful communication and collaboration lies in positive expression and positive listening of individual, mutual and collective viewpoints. Viewpoints need to be expressed for any discourse or debate and teamwork to be effective; the power of expression is proportional to the logic, coherence, cogency and equanimity of expression. Even the most critical thoughts can be positively expressed when expression is characterized by theses components. Positive expression is an intelligent and intellectual balance between spontaneity (which gives authenticity) and preparation (which removes negativity). The brain and mind must be developed to capture thoughts, internally articulate and validate and then only express. The skillful speaker has not only a spring full of thoughts but also the agility of mind to process them. Interestingly, the ability to powerfully and positively express comes from an ability to listen with sensitivity and responsiveness. Powerful political leaders such as Nehru, Gandhi, Obama, NTR and Modi have been orators who made listeners respond but also have been responsive to listeners through a balance of spontaneity and preparation.

Business leaders and managers must view communication as less of a task and more of an experience. Active listening happens not merely through ears but through eyes as well; whether it is a bilateral communication or multilateral communication. Active listening, as opposed to passive listening, requires that the listeners go beyond the words and look for the broader and deeper meanings of the communication; they must also see the meanings through observation of body language. The processing capability of the mind and brain mentioned above is essential for active listening. Active listeners tend to be effective speakers. Expressive listening, therefore, requires that both the speakers and listeners perform the other corresponding task simultaneously. Speakers need to be aware of the body language of the listeners to take listening cues while listeners need to process the communication and express their responses to themselves first internally. Expressive listening is a skill that comes not only with experience of participating in interactions but also with the understanding that expression and listening are two essential wheels of the cycle of communication.

Ambient meetings

Ambience marks all overwhelming experiences; from massive political road shows to selective business conferences; political orators (for example, Nehru) are effective and so are business orators (for example, Steve Jobs)   As important as oration is ambience. Successful political road shows have a rustic and earthy, open sky and sea of humanity ambience. NT Rama Rao (NTR), the legendary actor turned political leader and the founder of Telugu Desam party took mass contact to new levels through his chariot of awakening (Chaitanya Ratham). Steve Jobs took product launch events to ethereal trajectories through a powerful combination of technological works and theatrical oratory. It is important for speakers and listeners to give due attention to meeting formats, realizing that it is entirely in them to make business meetings interactive and informative.

There could be several themes for ambience; leader-led or listener-led, technology-led or human-led, concept-led or data-led, power point-led or persona-led, and so on. Business organizations have thus several formats to leverage for effective communication and collaboration. This contrasts with the rather singular option of mass contact that political organizations have. Successful political organizations succeed against the odds mainly through ambient meetings. It is important that business organizations approach meetings as more than simple task movers. The range of additional impact could be from meeting of minds to moving experiences; the former promotes collaborative harmony while the latter ensures transformative development, of both individuals and organizations. It may sound challenging but there is no other winning formula than a combination of structured spontaneity and prepared oratory to make meetings a compellingly immersive experience.

Posted by Dr CB Rao on May 25, 2014  

Decision Making at Strategic Crossroads: Managing Emotional Blinds and Reality Conundrums

Strategy is a unique process that helps firms and individuals steer their future. Many firms and individuals believe in strategic planning over a three or five year horizon and execution within the framework, inclusive of course corrections. Some, of course, do not believe in rigorous strategic planning and move into future based on aspirations. Surprisingly, despite robust planning and execution, firms and individuals face strategic crossroads. If this were not the case, behemoths like IBM and Sony would not have faced the need to divest their computer businesses. Motorola and Google would not have faced the need to divest and re-divest the Motorola mobility division respectively. Oftentimes, however, the choices would not be clear.

Strategic crossroads, and the ways to avoid and face strategic crossroads, is a concept that could add value to the strategy literature. Strategic options are an integral part of the strategy formulation process. Strategic options come with relatively clear costs and benefits. They are often laid out in pursuance of business objectives and have little emotional content, if any.  However, strategic crossroads refers to a situation where a firm or an individual feels that there is no assurance that any of the routes would offer a decisive win. Decision making in strategic crossroads has a significant emotional content. Also, options which have equal advantages, disadvantages or uncertainties qualify for defining strategic options. There is considerable literature on identifying strategic options and facilitating decision making for the options. There is, however, little clarity on decision making when faced with strategic crossroads, which this blog post attempts to fill.

Crossroads to dead-end

Physically, crossroads signifies a place where two roads meet and cross each other. Conceptually and in practice, it signifies an important point in a firm’s or an individual’s life where a decision taken to follow a route could have an irreversible impact. When someone is at crossroads, usually time is not on one’s side; nor will profitability be. At a very simple level, a heritage theatre with dilapidated infrastructure faces the crossroads of modernization, expanding as a multiplex, complete exiting from the theatre business or monetizing the real estate. At an industrial level, when a product technology that forms the bulwark of a firm’s revenues becomes obsolete and needs massive investments, the firm tends to be at crossroads of rejuvenating the technology or going for an entirely new technology, exiting the product and business altogether or in-licensing new products and businesses, for example. The decision in such circumstances is often weighed down by the emotional burden of leadership and managerial failure and a practical burden of ossified organization.

Many times, firms facing crossroads make compromised decisions. These are usually in terms of making too little an investment in product rejuvenation, balking at embracing new technology, keeping the declining products and businesses somehow alive or going in for new but inadequate technologies. As such half-hearted attempts fail to provide any impactful solution, the firm would only slip deeper into red. The ability to exit with a reasonable profit declines even more. The saga of once-upon leaders like Morepen, Koutons and Kingfisher Airlines in India indicates a shared inability to read the signs of crossroads appropriately. Kingfisher Airlines was at crossroads of consolidation versus growth, and of organic versus inorganic development when it decided to acquire the low cost airliner Air Deccan. The obviously wrong route taken has led to the progressive slide of Kingfisher Airlines. For that matter, as it exited Air Deccan itself faced similar crossroads; of riding out the low cost pressures over time versus exiting, exiting with reinvesting in a new business and adding a new business without exiting. Here again, for Air Deccan’s founder, exiting airliner business and reinvesting in air logistics business was a wrong route in combination. A wrong route taken when at crossroads can lead a firm to its final dead-end.

Emotional blinds

Decision making at crossroads is challenging not only because of difficult performance situation and uncertain revival options but also due to the emotional blinds that prevent the leaders from taking an objective review of the past and view of the future. At a professional level, one comes across cases of functional leaders who are unable to make shifts despite apparent failures (or sustained lack of progress) of their approaches. Many  public sector companies such as Jessop, Scooters India and HMT fall under this category where the professional heads and the ownership (in this case, the government) were unwilling to see the writing on the wall, and make an appropriate course correction, including revival or exit, in each case by recognizing the strategic crossroads without emotional blinkers. Such an emotion tinged approach is displayed in private enterprises as well though these are expected to be more analytical and logical in terms of profitability and sustainability. Firms in the airline, retail, realty and infrastructure industries fall in this category. There are many firms in these industries which got stalled facing crossroads, leading businesses to stages that are beyond redemption.

Emotional blinds work through several beliefs and perceptions to deter or defer meaningful action when at strategic crossroads until it is too late. The first is an ingrained belief that businesses are cyclical and, therefore, things would perforce improve; this approach fails to recognize that it is the firm’s actions, rather than the environmental cyclicality that leads to the crossroads situation most times. The second is that undertaking organizational changes in times of crossroads aggravates the already difficult position; this approach fails to recognize that organizations under stress are often in search of, and welcome, turnaround options. The third is that when at crossroads firms should minimize investments rather than commit more; this approach fails to recognize that reversal of failure and acceleration of success can only occur with investments in hardware (facilities, technology and equipment, for example) and software (people and processes, for example), the mix of hardware and software varying on a case by case basis. The fourth is that firms at crossroads cannot attract external support (financial or otherwise); this approach fails to recognize that there would always be objective supporters for objective plans.

Reality conundrums  

The root cause for emotional blinds developing in an organization is often deep and certainly not any of those emotions that underlie the strategic behaviors that are displayed when crossroads are faced. Fundamentally, the inability to understand and appreciate realism as a way of life creates emotional blinds. When an infrastructure firm which is well aware of the long term nature of infrastructure investments, protracted payback periods and the inhibitory nature of the external environment that are inherent in Indian infrastructure projects draws up plans of quick returns to the investors, the inherent unrealism of the plan becomes the core weakness for the future. Granted, no one can predict the future from internal or external perspectives and therefore no one can also come up with a realistic path forward; the concept of realism, however, is more than that. Realism is being in touch with oneself, people, organization, environment, plans, execution, results, competition, and all such stakeholder interests. Unrealism, apart from not being realistic also includes being unduly optimistic or pessimistic, unwarranted by reality.

While several emotions such as feelings of infallibility, invincibility, egoism, and such others are often touted as reasons for leaders bringing their firms to crossroads and thereafter not being able to course-correct, the root cause would still be unrealism as defined above. Being unreal and being excessively optimistic or pessimistic is at the core of all strategic crossroads issues; the run-up, paralysis and dead-end. It is not the intent of this blog post to advocate a nebulous quest for realism nor is it to decry optimism and deprecate pessimism. The fact is that for the future only an aspiration exists, and a future reality can never be seen by mortals; every plan or action, therefore, tends to be only either optimistic or pessimistic. And, many times it lies in our own hands to turn aspirations into reality. What this blog post does advocate is the need for people to be in touch with reality at every step or slide of progress. When faced with reality that is not aligned with aspiration (could be better or worse) it pays to be optimistic or pessimistic on future course as warranted.

Realism as DNA

Lest it should sound philosophical or theoretical, the blog post would clarify that realism in reality (no pun intended) is a way a person is wired and evolved from birth to think and act, talk and listen, evaluate and respond. A realistic person, like everyone else plans and acts unrealistically (that is, either too optimistically or too pessimistically) but he or she is wired to continuously measure the variance and calibrate his or her subsequent thoughts, actions, communication and collaboration. The realistic person unlike most persons does not get typified; he or she, on the other hand, is a continuously adaptive individual or leader. The realistic person, like most others, lives on, and for, aspirations; however, he or she never loses track of the variance between aspirations and the results. If the results are lower, reformatory actions are taken, and if the results are better, aspirations are set higher by such individuals and leaders.

The ability to treat optimism and pessimism as modulators to move towards realistic realization of aspirations is vital for individuals, leaders and firms. Just as being extroverted and introverted becomes relevant contextually, being optimistic and pessimistic is also contextual. Optimism drives action and aggression while pessimism enables caution and conservatism. As individuals and leaders remain realistic, and absorb and assess the aspiration-result variation realistically, they would need to apply optimism and pessimism in tandem to set high aspirations and consistently achieve them. There have been excellent case studies of institutions in India, outside the normal business milieu, which have done exactly that with their leaders being responsible for such strategic approach in no small measure. Indian Space Research Organization (ISRO) is a striking example of live-wiring realism towards consistently higher aspirations, and achieving them despite resource constraints. Individuals, leaders and firms in their strategic journeys, and those at strategic crossroads may strive to embed realism as their DNA.

Posted by Dr CB Rao on May 18, 2014

Awareness, Self-awareness and Humility: The Three Components of Sustainable Success

On May 9, 2014, there was an interesting article that appeared in the Times of India, “Humility makes CEOs from India Stand Out”, which hypothesized that the ascent of Indian origin leaders as CEOs in global corporations is related to Indians being humble by nature. The reference has been, among others, to Indra Nooyi, Chairperson of Pepsi, Satya Nadella, CEO of Microsoft, Nitin Nohria, Dean of Harvard and Rajiv Suri, CEO of Nokia Networks. There is no doubt that persons from outside the Western world would find it hard to reach apex positions in Western headquartered global corporations. This is as unsurprising as a Western executive finding it difficult to be at the helm of a Japanese corporation. National culture has probably has as much role as notional competence in influencing leadership choices. The ascent of Indians to CEO positions is, therefore, remarkable and noteworthy. 

The article quotes Govind Iyer, managing director of Egon Zehnder India, a leading executive search firm as stating that humility is the key to being a respected leader as that means the leader is receptive towards learning and professional growth. He also clarifies that humility does not mean one cannot be aggressive and extrovert. He emphasizes that these qualities need to be displayed with humility. Rajiv Burman, managing director of Lighthouse Partners, another executive search firm hypothesizes in the article that given the strong emphasis in the Indian culture on family and social relationships, the Indian leaders work very effectively in groups with humility. Vivek Chandra, country manager-India, Harvard Business Publishing considers that leaders who develop higher self-awareness tend to be more humble.  In the same article, Lynda Gratton, professor of management practice is quoted as saying that emphasis on authenticity and inner journey is a characteristic of changing leadership expectations.

Hard and soft

Leaders are expected to lead. It is therefore believed that leaders must exert their presence with knowledge, expression and execution through which they must be able to influence and align their followers. Aggression and extroversion, enjoying success every bit openly, are also considered good additions to a successful leadership profile. These may well be the ‘hard’ qualities that define leadership. Leadership built only on these hard factors tends to be vulnerable to performance dips even if performance drivers are beyond the leader’s control. Leaders need certain ‘soft’ qualities that help the leaders go beyond driving and influencing. Soft qualities are those that endear leaders to their followers. They help the leaders connect with their followers and even non-followers sustainably. Mahatma Gandhi is an enduring example of soft qualities adding sheen and sustainability to leadership. Humility has been the most prominent of Gandhi’s soft leadership qualities.

The role of humility in influencing leadership development is not well understood. Humility is the quality of being humble. Humility is the quality of thinking that one is not better than others (although one’s achievements or others’ opinions may imply so). One’s humility is never expressed but is invariably felt and experienced by others. Humility can never be a sign of weakness or passivity rather it stems out of one’s conviction and courage, in a sense. Winston Churchill stated that while it requires courage to stand up and speak out it also requires courage to sit down and listen. This is an interesting concept. Individuals who are humble to face constructive challenges are often able to discover their own abilities or learn new capabilities that help manage them. The earlier discussed aspect of self-awareness is the foundation for developing authenticity which is capped by humility.

Awareness and self-awareness

The author in two of his earlier blog posts discussed aspects of awareness and self-awareness.  These are “Self-actualization by One’s Self for Oneself: An Enlightened Process for the Elusive Goal”, Strategy Musings, April 21, 2013 (http://cbrao2008.blogspot.in/2013/04/self-actualization-by-ones-self-for.html), and “Awareness and Resilience Management (ARM): Arming for Success and Happiness in Life”, Strategy Musings, February 3, 2013 (http://cbrao2008.blogspot.in/2013/02/awareness-and-resilience-management-arm.html). These blog posts discussed the approaches for self-awareness. The blog posts focused on individuals in a broader perspective rather than on leaders, per se (individuals, of course are leaders, and vice versa). There are two interesting concepts that the author would like to propose in this blog post. The first is whether an increase in awareness leads to a correlated increase in self-awareness. The second is whether self-awareness is enhanced or impeded by awareness, especially at leadership level.

As regards the first, the comprehensiveness of one’s awareness largely determines how well awareness leads to self-awareness. If one, for example, gets focused only on material aspects of professional life or personal life, it is unlikely that one would be appreciating the need for self-awareness. Self-awareness has a significant philosophical and spiritual content of which one would need to be aware of; this helps one to be appreciative of the need for self-awareness, and the paths towards that. As regards the second, individuals tend to lose self-awareness as they become more aware of the material aspects of success or failure. Success blinds one to one’s weaknesses and the need to overcome them while failure may cause one to lose confidence in one’s strengths and remain vulnerable to one’s weaknesses. As one moves on the leadership journey or the broader life journey, one would need to recognize development of self-awareness as an important component of developing awareness. 

Outcomes as inputs

While awareness and self-awareness can be developed as conscious processes, outcomes are important inputs in the awareness journey. The simplest example of outcome-driven awareness development is the examination system. The success or failure, and the rank achieved in each case acts as a trigger for enhancing one’s awareness. As one moves from broad generic school level courses to more focused college and university courses, and thereafter to industrial, business or academic employment aptitude tests help develop self-awareness. Outcomes in work environment and in leadership journey become harder to relate, despite all the efforts to define accountability and responsibility. Individuals would need to possess an elevated and discerning sense of outcomes as related to their contributions or non-contributions as part of the self-awareness journey.

At individual level, there are three imperatives for awareness and self-awareness balance. The first is a determination to be aware and self-aware. This can be achieved through a quest for all-round knowledge on one hand and an openness of mind on the other hand. Curricular and extracurricular learning and on-work and off-work learning need to be strong components of the awareness processes. The second is an ability to be sensitive to quantitative and qualitative cues. The second is achieved through a conscious processing of the external realities and underlying drivers. The third is a willingness to introspect oneself vis-à-vis expectations and improve to set right expectations and achieve right results. Awareness without self-awareness could be misleading while self-awareness without awareness could be paralytic. Both need to coexist in a virtuous humility canopy.   

Authentic humility

Awareness which leads to knowledge and competencies, and self-awareness which leads to self-improvement are the ideal combination to make an individual or a leader hugely successful. The key to sustaining such success lies in humility; humility that teaches one that success need not be worn on one’s sleeve, humility that teaches that failure is a result of lack of humility, humility that teaches that there can always be scope for self-improvement, humility that teaches one to respect others, and humility that enables development of bigger individuals or leaders than oneself. It is important to note that if power and presence are required in certain contexts, they are effectively provided by stature and humility as much as by knowledge and execution. In a recent pre-launch curtain raiser of his animation super movie Kochadaiiyaan 3D (Vikram Simha in Telugu), the superstar and hero of the movie, Rajinikanth said that Kamal Hassan was a great technical actor who was perhaps the right one for such a technical movie (dubbed as India’s first performance capture photorealistic film) but God has desired that Rajini should do that. The humility of the superstar was not lost on the huge audience.

Like most emotions or soft skills, humility also can be affected and not real. Individuals can put up a charade of humility. However, authentic humility is easily distinguished from affected humility. Self-awareness is the key to genuine humility. It enables people to overcome their shortcomings through greater and better awareness, and appreciate others’ superiority or need for support to others. A self-aware leader creates success by working with and leveraging the capabilities of others capable peers. Mahatma Gandhi’s humility helped him reach out to the nation on one hand and work with other capable leaders on the other. At the institutional level as well, successful institutions which are humble are likely to achieve far greater and sustainable success than other institutions which are smug on success or impervious to criticism. If Toyota had to face unexpected recalls it was due to a belief that the best was always being done and if Toyota still retained brand equity and went on to achieve a global record production nearly of 10 million vehicles last year, the reason lies in its humility to accept that even the best was not good enough, and there was scope for self-improvement.

Posted by Dr CB Rao on May 11, 2014    

Retailing Format, Marketing Personality and Customer Service: The Three Drivers for an Indian Retail Revolution

India has today several glitzy malls with shops dedicated for homegrown brands as well as multinational brands. The retail channels are a combination of single brand retail or multi-brand retail shops. Also coexisting in the normal shopping districts are standalone shops and the ubiquitous kirana shops (mom and pop stores). Quite obviously, the investments in the mall based retailing are significantly higher than those in the more traditional ones. Frequenting the variety of shopping options, one would certainly find a step function increase in product choices but an inexplicable lag in terms of salesmanship and customer service. Even the traditional retailers seem to be less concerned about attracting customers and retaining customer loyalty. As India would continue to witness an explosive retail growth, in terms of infrastructure mainly, long term viability would depend on full utilization of such infrastructure.

The new Indian retail revolution seems to be based on mall and shop infrastructure on one hand and product portfolio on the other. Communication is largely through media advertisements and text messaging. New product launches, discount periods and festival seasons are leveraged to inform customers of product availability. The expectation of the retailers, however, largely is for customers to reach out and choose for themselves the products they need. The importance of customer service to connect the customer with the products on one hand and the retailer on the other seems to be less recognized. There is, of course, a hypothesis that the customer of today is well informed and he need not be burdened with excessive verbiage on the products. Such hypothesis misses the point that customer service has a more holistic meaning to it.

Physical and virtual

Customers are aware that there are now several options to source anything through the Internet, often at lower prices, and based on considered evaluation of alternate product characteristics. Yet, the physical format, despite its price premium, offers one unique advantage of person to person contact and a conversation to help the customer. The physical malls and shops of today seem to miss on this element all together. Even where product displays are provided, the emphasis is more on the customer-product contact than on customer-salesman contact. In rare cases where customer-sales person contact is enabled, the emphasis is more on meeting the sales target rather than on understanding and fulfilling the customer need. The two key influencers are the ratio of sales persons to customers and the marketing personality of the sales person.

It is important to note that while virtual format cannot replicate any of the unique features of the physical format, the physical format can combine the best of both the formats. At an intense level, it could be providing a suite of computers and tablets for customers to first exercising their choice short list through virtual retailing and then taking them on to more focused physical marketing. At a subtle level, it could be in terms of electronic displays that stream live the high points of the shop and its products. While the virtual format can rise up to the physical challenge by promising the earliest possible delivery (for example, the promise by amazon.in of a 24 hour delivery), the physical format can extend itself by promising wider access beyond what is on the shelves through in-store Internet kiosks. The key to the success of the physical-virtual combination lies in making browsing while shopping feasible and pleasurable.

Retailing format

Apart from multi brand and mono brand retailing options, category retailing options also exist. For example, Reliance has chosen to develop specific retailing channels and store formats for product categories such as home needs (including FMCG), footwear, apparel and electronics. Future Group also follows a similar approach with Big Bazar and Pantaloons. Tata Group has Landmark, Westside and Croma for books, apparel & accessories and electronics respectively. The logic is that such segmented retailing enables focused customer groups which can be served with better product choices in each category. The results have, however, been mixed. Given the relatively high work pressures in India, it is a moot point if consumers would like to visit dedicated shops or would prefer one location for all their needs. The success of malls is perhaps attributable to the need to have one stop retailing solution. None of these groups, however, has experimented with a monolithic retailing format such as Walmart, where their own corporate brands act as mega malls.

Indian retail may experiment with one more concept of stores within stores. Large behemoths like Hindustan Unilever and P&G may create sub-stores within the stores where all of their products can be offered as integrated solutions. This is a trend that is apparent in electronics with displays organized as per product categories and brands with dedicated sales personnel. It is the value proposition of brand loyalty and product loyalty that could determine the drive for, and success of, such a store within a store concept. Extending it further, these giants could have their own exclusive sales plazas or malls. There is, therefore, likely high scope for further evolution of the physical retailing format in multiple models. Whichever retailing model is adopted, the development of a marketing personality would be foundational for the retail success.

Marketing personality

The success of the physical format depends on the marketing personality of the shop and its sales persons. Marketing personality, like all professional personalities, gets developed based on personal attributes, education and experience. While Indian institutions are focused on developing marketing managers, little infrastructural support is available to develop the needed marketing personality in frontline sales personnel. These persons do not need statistics for market research or strategy for market penetration. They need, however, a deep understanding of consumer psychology, a thorough knowledge of product attributes, an inquisitive mind for customer needs, an empathetic approach to striking a conversation, and above all a commitment to deliver value for the customer. They are relationship managers more than sellers or marketers.

Larger hotel and hospitality chains have been quick to realize the need for frontline customer interface and have established dedicated in-house training institutions and on the job training and apprenticeship programs. Shops and malls as well as a host of other customer-facing organizations have perforce to depend on the general pool of talent from educational institutions. There are, however, only a very few institutes in India that impart the right kind of education and training for developing a well-rounded marketing personality. National Institute of Sales, founded by NIIT has been one but the country needs a lot more. On the lines of Industrial Training Institutes offering technical apprenticeship training, the country needs Marketing Training Institutes to turn out sales and marketing personnel who can support the retail revolution.  A retail outlet that has persons of appropriate marketing personality tends to acquire a customer-friendly personality of its own. If retailing format would owe its success to marketing personality, the latter in turn would need customer service as the key driver.

Customer service

Customer service has several components. The first is a warm greeting; whether a sales person welcoming a customer to the store or a field sales person greeting the homemaker or doctor, the warmth, smile and connectivity of the welcome greeting sets the tone for a customer friendly ambience. The second is a polite enquiry on what the customer is looking for. The ability to distinguish between focused and unfocused customers as well as impatient and languid customers is the key to guide them appropriately to the required store location. The third is to provide transparent and authentic product information; informed decision making by the customer leads to customer satisfaction. The fourth is to understand customer indecisiveness as an opportunity for need discovery rather than to force a buy through canvassing. The fifth is an ability to commit to getting the right product after the need discovery. As products range from high generic to high technology, the need to understand consumer psychology and align the store philosophy becomes progressively more important.

As products move higher in specificity and technology, two factors become important. The first is the ability and willingness to offer pre- and post- sales support; this is essential to ensure complete lifecycle support to the customers. The second is the ability and willingness to transform each sales transaction into relationship development; this is essential to ensure a value proposition for Indian retailing beyond products and brands. To succeed in this, the ratio of customer service executives to the customer base becomes important. Investment in people and technology would be an important component of the new retail format. People investments must focus on adequate numbers of trained marketing people. Investments in technology should focus on understanding the consumer needs better and forming a long lasting relationship with them. When Google and Facebook can collect huge amount of information on the preferences of the site visitors simply through their browsing habits, the physical stores should be in a position to supplement customer data bases with physical connectivity and emotional rapport.   

In the emerging Indian retailing milieu, as discussed in this blog post, while the choice of an appropriate and differentiated retailing format would be a key strategy consistent with each retailer’s vision, development of marketing personality and integration of customer service would be universally required to drive sustainable growth.

Posted by Dr CB Rao on May 4, 2014