Startup Success – A Clear and Good Value Proposition “You don’t get a second chance to make a first impression”   “The strategy is to first know what you don’t know, the tactic is to grind, and the value is to remember: there are plenty of places to innovate.” -David Friedberg, Founder @ Weatherbill   A great value proposition is indispensable for any business hoping to clearly communicate to customers why they are different, better, and worth purchasing from.   Why Your Value Proposition Matters? “A problem well stated is a problem half solved.”-Charles Kettering The problem is, many companies just can’t seem to nail down exactly what a value proposition is and what it should say.     A value proposition is a clear statement of the tangible results a customer gets from using your products or services. Its outcome is focused and stresses the business value of your offering. Let the statement you make come from your heart, let it represent the very idea behind your business, let it highlight the benefits you plan to give your customers, let it awaken the entrepreneurial spirit and make you want to do something more for the end users, let it be straight but sharp. What makes a good value proposition? Clarity! It’s easy to understand. It communicates the concrete results a customer will get from purchasing and using your products and/or services. It says how it’s different or better than the competitor’s offer. It avoids hype (like ‘never seen before amazing miracle product’), superlatives (‘best’) and business jargon (‘value-added interactions’). It can be read and understood in about 5 seconds. I basically like what Pinterest has to offer- their unique and simple pin boards to organize our thoughts around a subject. I feel happy when I visit Pinterest and exploring various pins gives me immense satisfaction. The way they have developed their business around the mindset of people is something brilliant. It’s attractive to women. To designers. To photographers and artists. To mom’s who cook, decorate or plan events. That’s kinda niche-y. Some Interesting Value Proposition Quotes: A unique value proposition is a single, clear compelling message that states why you are different and worth buying – Steve Blank Price is what you pay, Value is what you get – Warren Buffet If people like you they will listen to you, but if they trust you, they’ll do business with you – Unknown Live authentically. Why would you continue to compromise something that’s beautiful to create something that is fake- Steve Maraboli You do not really understand something unless you can explain it to your grandmother – Albert Einstein <a HREF=”http://ws-in.amazon-adsystem.com/widgets/q?rt=tf_cw&ServiceVersion=20070822&MarketPlace=IN&ID=V20070822%2FIN%2Fmanagementgur-21%2F8010%2F62da8e52-21d7-4d09-9aff-da04d242f556&Operation=NoScript”>Amazon.in...

PORTER’S FIVE FORCES Porter’s five forces analysis-draws upon industrial organization (IO) economics to derive five forces that determine the competitive intensity and therefore attractiveness of a market. Survival of the Fittest: True to Darwin’s theory “Survival of the fittest”, only competitive firms survive in the business market, provided, they have made the right strategic choice by comprehensively analyzing their position in the industry. Every organization is part of the industry and almost all of them face competition. Thus, industry and competition are the vital considerations for making a strategic choice. All the firms in a particular industry vie for the same set of customers by offering identical or similar products with minor variations. The analysis of the external environment in relation to the context of industry attractiveness thus becomes essential. A Critical Evaluation of Michael Porter’s Five Forces Framework Industrial Analysis: Industry analysis helps a firm to also fix long range plans, by gauging long term growth opportunities present if any. Strategic choice is nothing but, to screen all possible strategic alternatives followed by narrowing down the choice to the best suited and feasible alternatives and ultimately choosing an optimum strategy. To explain it in more clear terms, let us look at this example. Say, if there are three big players of car manufacturers in an automobile industry. Each follows their own strategic style to capture the market. What are the threat factors? Threat can be in the form of four-wheeler manufacturers like trucks and jeeps, but these cannot be competitively priced. Threat can be in the form of suppliers who dominate the industry by having a grip on the supply of components, sub-assemblies and accessories. Threat in the form of new entrants, but the growth might be restricted due to government regulations. A thorough analysis of the automobile industry thus made can make things clear to the firm, as to where they stand in terms of market share, what are their strengths and weaknesses, who pose a threat, what are the potential opportunities for growth and to tap market segments whose needs are unidentified. Still, it will be a seller’s market where the buyers have no bargaining power. On the other hand, if the weather does not favor its growth, the firm has to immediately decide on its next course of action, calling for diversification. The possible threats for a firm can come from five directions as mentioned below: Potential threat from new firms entering the market Threat from substitutes available in the market Threat from competitors Bargaining power of the suppliers Bargaining power of the buyers The structure and dynamics of an industry has to be analyzed in order to determine the intensity of competition and profitability. As the market is very dynamic, it becomes mandatory for firms to evolve strategies embracing a modern approach, with emphasis on reappraisal of existing strategy in the light of changing external conditions and formulation of alternative...

Game theory and strategy What is Game Theory: Set of concepts designed for decision making in situations of competition and conflict under specified rules. The prisoner’s dilemma: The prisoner’s dilemma is a canonical example of a game, analyzed in game theory that explains why two individuals might not cooperate, even if it appears that it is in their best interest to do so; Albert W. Tucker formalized the game with prison sentence payoffs and gave it the “prisoner’s dilemma” name.   To solve many practical problems that are encountered in economic, military or other disciplines, one has to deal with situations in which there are two or more conflicting parties striving for the same objective and the outcome of each action of one party depends solely on the opposite parties choice of a course of action. As we all know only one horse can win the race ultimately and the other parties only can prolong the race or see to that they make every possible move to delay the opponent’s success. So, what’s this game theory all about? This is a special mathematical method that was evolved mainly to analyze conflict situations where the number of competitors is finite, each participant has a definite set of actions to choose and there is a conflict of interest between the competitors. So it helped the participants to reach a decision that would put them in the winning post. This theory has spilled its implications on business situations where success is the motto and conflict and competition the order of the day. Only the best among the best survive. Darwin’s theory, “Survival of the fittest” applies not only to biological organisms but also to business organizations which are also abuzz with activity. Chance Moves: Games like chess, checkers are played according to a definite set of rules laid down and these game patterns has inspired business persons to introduce strategies in business, where the concentration is mainly focused on the chance moves that defeats the opponent. Big business corporates mainly concentrate on the strengths and weaknesses of their competitors to have an edge over them. A real game is controlled and regulated by the statutory rules to be followed but a business game involves lot of killer instincts and intuitions combined with rational thinking and logic. Optimal Strategy: The first party always puts himself in the shoes of the other party and tries to perceive how the other party would react in a particular situation. Although the aim is to win, choosing the optimal strategy is what matters. It will at least keep you in bay. Precise solutions can be arrived at if you plan your game fittingly. The anticipation and thrill that is involved in a strategic game is matchless. We witness a lot of firms imitating what the leader of the market does. The risk is borne solely by the firm introducing the change and the firm takes the major share of profit as it is the pioneer and if it loses the next strategic move is planned for.     For a company with sound financial position, the chance move is worth giving a try, head or tail doesn’t matter. The stalkers are benefited by the waiting period during which they come to know of the pros and cons of the strategy employed by the leader. Games are played in the true spirit of sportsmanship, but a business faces cut throat competition. There is no space for any courtesy or liberal approach. If you are quick enough to pick the pulse of the people by gauging their preferences, analyzing the market conditions and employing timely strategies you will at...

What is the relationship between Corporate Social Responsibility and Business Ethics Business ethics can be defined as the principles and standards that establish acceptable conduct in business organizations. The acceptability of behaviour in business is determined by customers, competitors, government regulators, interest groups, and the public, as well as each individual’s personal moral principles and values. Can Ethics be Taught? I feel that ethics cannot be taught: it is an inbuilt entity and in countries like India where religion is all pervasive in business or any other discipline, this quality is imbibed in every individual right from his birth. The power of money and authority plays a major role in changing a man’s perspective and bureaucratic hurdles and red tapism mar the pace of business development. Businessmen should never compromise ethical principles with short-sighted objectives of amassing material wealth but should develop a spirit of altruism. Management education should focus also on training the individuals to be ethic-savvy apart from being mere decision making authorities satisfied with their designation and power of authority. Employees have the same kind of ethical responsibility towards their organisation and should not misuse time and property and should not place their interests before the enterprise objectives.  What is Corporate Social Responsibility? Many consumers and social advocates reckon that businesses should not only make a profit but also consider the social implications of their activities. We define social responsibility as a business’s obligation to maximize its positive impact and minimize its negative impact on society. Although many people use the terms social responsibility and ethics interchangeably, they do not mean the same thing. Business ethics relates to an individual’s or a work group’s decisions that society evaluates as right or wrong, whereas social responsibility is a broader concept that concerns the impact of the entire business’s activities on society. There are good business reasons for a strong commitment to ethical values: 1. Ethical companies have been shown to be more profitable. 2. Making ethical choices results in lower stress for corporate managers and other employees. 3. Our reputation, good or bad, endures. 4. Ethical behaviour enhances leadership. 5. The alternative to voluntary ethical behaviour is demanding and costly regulation. Points to Ponder relating to behavioral ethics. 1. What conflicts of interest have you personally experienced in personal or professional roles? 2. If you perceive a potential conflict for yourself, what are some ways you might ensure that this conflict doesn’t lead to unethical behavior for you and others? 3. When have others’ conflicts of interest impacted how you or those you know were treated? 4. What types of policies can or do organizations implement to try to reduce conflicts of interest or their costs? 5. Why do you believe conflicts of interest are so pervasive in society? Why don’t we take more steps to avoid them? 6. Why is it so hard for individuals to recognize their own conflicts of interest, and how is this impacted by behavioral biases? Unethical behavior,conflicts,personal interests,responsibility What is Conflict of Interest? Conflict of interest arises when there is a clash between responsibility and reward. Say, if a doctor decides to be more business-like, if a judge decides to favor one party, if a ruling party favors a decision not good for the masses, what will happen? A conflict of interest exists when a person must choose whether to advance his or her own personal interests or those of others. Wal-Mart Stores, Inc., may have the toughest policy against conflict of interest in the retail industry. Sam Walton, the late founder of Wal-Mart, disallowed  company buyers from accepting so much as a cup of coffee from suppliers. The Wal-Mart policy is black...

Key Components of Marketing System The core marketing system of a company comprises the suppliers, company, marketing intermediaries and target customers. The success of the company is also affected by competitor’s presence and other segments of public. The management has to watch and plan for all these factors to serve and satisfy the specified set of needs of a chosen target market.   Supplier Selection: A company has to choose suppliers who offer the best mix of quality, delivery schedule, guarantee and low cost. Say, a firm involved in manufacturing confectioneries has to procure sugar, cocoa, caramel, milk powder; Labor, equipment, fuel, electricity and other factors of production are also to be obtained. If the company’s product has a good market, it can opt for continuous production. If it is a growing firm, it cannot go for voluminous production, but only supply goods against confirmed orders. In either case, the choice of suppliers is determined by one major factor called ‘cost’. Of course, one can never compromise on quality and so the company has to decide whether to purchase the inputs or make its own. Pic Courtesy : 5 Steps to Successful Supplier Selection The relationship of a company with the suppliers should be of a long-term nature, since any sudden change in the supplier’s environment will have a substantial impact on the company’s marketing operations. Sudden supply shortages, labor strikes and other events can interfere with the fulfillment of delivery promises to customers. This will result in sales decline in the short run and loss of goodwill in the long run. Back orders lead to loss of customers and in course of time their trust. The business firms must plan for alternate source of supply to avoid the risk of over-dependence on any one source of supplier. Company The marketing department has to work in tandem with the other departments of the company namely, finance, production, personnel and research and development, while designing and implementing its marketing plans. Finance department – has to be consulted regarding the availability and deployment of funds to carry out the marketing plans. Production department – to gauge market demand and to decide on the supply of products based on demand. R and D – new product development. Equally important is Digital Marketing which is considered to be an integral part of your promotional activities – What you are seeing above is a depiction of tools that help you in marketing your products online. Marketing intermediaries: Channel members are the link between the company and the customers. Agents and middlemen find customers who are wholesalers or retailers to take on the title and sell the merchandise. Also there are physical distribution firms who assist in stocking and moving goods from the warehouse to the destinations. The marketing executives have to deal with these intermediaries prudently in order to enhance the operational efficiency of the marketing function. Logistic firms, shippers and airliners help to move the goods from one location to another. Competitors: All the business firms in a particular market segment vie for the same resources and customers. A car manufacturing company in an automobile industry has to compete with other car manufacturers as well as with two wheelers. This implies that competition may come in different forms and each company has to identify potential threat from competitors, study their activities and capture their moves to win over the competition. Public: A company has to keep a close watch on people’s preferences to satisfy their requirements and also it is expected to give back something to the society in the form of social welfare measures. Employees belonging to different culture groups with differing attitudes,...