Lloyd Blankfein

George W Bush

Harsha Bhogle



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George W Bush – President of the United States, at the Atrium of the ISB’s Academic Centre

editor’s desk
Dear Reader, This issue of the ISBInsight has interesting opinions on the hot topic of ‘Branding’. The markets are abuzz with the news of the tremendous growth potential and the huge opportunities that emerging markets present. Professors of Marketing, Marketers, Consultants – all of them see a bright future when they peek into the crystal ball, and all of them agree that the new markets need creative approaches to branding. Brands have the power to change people’s lives – and to change the world. The BRIC countries featured again in the speech of Lloyd Blankfein, the President & COO of Goldman Sachs Inc., during his maiden visit to India and the ISB. He talked about the irreversible progress of wealth creation in them. His visit and contribution of $1 million to the Centre for Analytical Finance was the high point for the ISB this last quarter. It appears that India is on a winning spree all around. With the cricket season in full swing, we were fortunate to get Harsha Bhogle and Professor Bob Stewart, who teaches Sports Management at the ISB’s Executive Programmes, together for a chat on the challenges of encouraging excellence in sports in developing countries. It was the season for the annual student led events - the ILS, Solstice, Poseidon and some unusual topics such as ‘Youth Particpation in Politics’ were discussed. The mood at the ISB has been upbeat with the entire community feeling that we in India are on the verge of something really big. The ISBInsight reflects this mood. We share the brief and exciting encounter with President George W Bush, when he visited the ISB on March 3, 2006. “The world needs India,” he said and added, “I am honoured to be at the ISB,” almost endorsing Brand India and Brand ISB. It was a memorable visit in which the faculty, students, staff, and entrepreneurs participated. The ‘Insight Special’ captures the visit and the reactions. It will be great if you could share your opinions on what we think. As always please email us at editor_insight@isb.edu

ISBInsight team Bhuvana Ramalingam Sreedevi Yadavalli Mrinal Kanti Ray Varshaa Ratnaparke Madhavilatha G Design: Trapeze Cover Illustration: Anupa Jayakrishnan Resources: Learning Resource Centre at the ISB Printed at Kala Jyothi Process Pvt. Ltd. Indian School of Business Gachibowli, Hyderabad 500032, India Phone: 91 40 23007000, Fax: 23007012 Email: editor_insight@isb.edu www.isb.edu Back Cover: The architectural splendour of the ISB buildings – A view of one of the Student Villages

Bhuvana Ramalingam Editor

March 2006 | ISB insight | 1




From the



Insight Special: President George W Bush Visits the ISB

The ISB grabbed headlines the world over recently when the US President visited its campus. Our special feature captures the event.
Sandeep Dikshit – MP, Lok Sabha


Learning Lessons from Australian Sport Management

4 Cover Story: Brand Strategies in Emerging Markets

Harsha Bhogle exchanges notes with Professor Bob Stewart on how an emerging economy like India can learn from the experience of Australia in managing sport.
30 ISB Leadership Summit 2006: India Next

With emerging markets experiencing an economic boom, marketers are being challenged to find unique brand solutions.
GSVC judges – Alice Lin, Kim Alter, & Sara Olsen


Understanding Tomorrow’s Tigers

Academicians, consultants, and industry leaders share their perspectives and practical experiences about brands that work in emerging markets.
11 Strategies for Harnessing Local Brands

Politicians and business leaders, along with an academician and a social activist, discuss the need for greater youth participation in politics, and on synergies between the government and businesses for India Next.
31 India on a High Growth Trajectory: Lloyd Blankfein, President & COO, Goldman Sachs Group Inc.

Vijay Mahajan and Kamini Banga discuss strategies that can help companies leverage their brands to create opportunities in the “86 percent” markets.
16 The Emerging Consumer 32

Lloyd Blankfein addresses the ISB students on his experience at Goldman Sachs, and compliments India on its emergence as a destination for direct investments.
Competitive Intelligence for Staying Ahead in the Market

Professor Sridhar Moorthy discusses the branding challenges for marketers considering the decreasing power of television, and increasing power of “word-of-mouse.”
19 Shouting Over the Fray: An Academic Perspective on Measuring the Impact of Advertising in a Cluttered Environment 34

Phani Tej Adidam discusses cases where CI analyses have been successfully employed by companies to stay ahead of their competitors
The Current Status of Indian Economic Sector Reforms

Professor Seshan Ramaswami on how academic research can contribute to a greater understanding of the effects of advertising in a cluttered environment.

A report on the proceedings of a unique conference organised by the Stanford Center for International Development (SCID) and the Centre for Analytical Finance (CAF), ISB.

2 | ISB insight | March 2006

42 ISB Happenings Rajendra S Pawar – Chairman. and also provide tangible social benefits.36 GSVC: Social Ventures That Look Beyond the Bottom Line The Asia Semi Finals of the GSVC held at the ISB. attracted a lot of attention for the competition’s focus on business plans that are profitable. RBI S Narayan – Former Economic Advisor to the Prime Minister of India. on the special bond that she shares with the ISB. NIIT There was plenty happening at the ISB. 40 My Journey with the ISB: Memoirs of an Alum Aarthi Ramesh. & Former Finance Secretary. student competitions. Three students interview Professor Hayagreeva Rao on the blurring of categorical boundaries in organisational structures. 38 The Erosion of Categorical Boundaries: Interview with Professor Hayagreeva Rao Tejendra Khanna – Chairman. 44 Book Review Rakesh Mohan – Deputy Governor. Ranbaxy Laboratories Ltd. Class of 2003. with eminent visitors and guest speakers. Goverment of India March 2006 | ISB insight | 3 . as always. and colourful events that had the campus buzzing with activity.

and “regional”. and several others. These countries comprise a whopping “86 percent” of the world’s market. Developing and implementing these solutions often demands innovation. former Dean of the ISB. Some characteristics that are common to customers in both the developed and the developing economies are – an enormous appetite for devouring television entertainment while displaying a marked tendency to avoid commercials. are currently experiencing a heightened consumerism owing to a boom in their economies. and an inexhaustible drive to overcome obstacles in adapting to local conditions.Brand Strategies in Emerging Markets ountries such as China. This is because emerging markets have some characteristics common with the more mature markets. they also exhibit features that are unique. and current holder of the Harbin Centennial Chair in Business at the University of Texas in Austin. the heightened consumerism. and rapid globalisation. On the other hand. Russia. Brazil. is presenting global marketers with immense opportunities. causing companies to incur losses. Marketing successfully to the “86 percent” is imperative for companies that want to remain globally competitive. Mexico. South Africa. the Net savvy consumer preferring to seek brand information through “word-of-mouse” sources rather than the conventional . sometimes fail in emerging markets. South Korea. and lose great marketing opportunities. Egypt. On the one hand. India. a term used by Vijay Mahajan. Time tested brand strategies that worked very well in the developed world. these opportunities are riddled with some unique challenges for market solutions for emerging markets are different from those for the developed 4 | ISB insight | March 2006 C markets.

Leading academicians and consultants share their expertise on brand strategy. from one region within an emerging market to another. and is often variable from one emerging market to another. but the unarticulated needs as well. said during his address to the participants of Ikshaa – the ISB Marketing Summit. developed economies. Emerging markets are extremely price sensitive. “In today’s brand strategies. etc. Dean. What is singularly distinctive of emerging markets is a strong regional influence. Our cover story is an amalgam of all these perspectives about brand strategies in emerging markets. as well as quality conscious. The influence could be cultural.” and also prefer a foreign brand in a show of “sophistication.” which is a complex tapestry of global and local attributes. what remains challenging is the need to be constantly innovative. while market leaders describe actual experiences in developing and marketing their brands. linguistic. Kellogg School of Management.” March 2006 | ISB insight | 5 . the word ‘anticipation’ becomes more important than ‘prediction’.” These markets demand the right mix of “glocalisation. socio-political. With companies developing a variety of solutions to meet the needs of emerging markets. As Dipak Jain. and even religious. we need to address not only the articulated needs of consumers. and more perplexingly. Academic studies also point to a “cluttered” advertising environment in emerging markets such as India. They can display a fierce loyalty to a local brand in a show of “patriotism.“word-of-mouth” ones. a problem earlier associated only with the mature. We no longer have the luxury of being reactive.

low-value contract manufacturers have become today’s high-potential markets. “Poor development of infrastructure.” Thus.” “Dreaming with BRICs: The path to 2050” Goldman Sachs report. do not mean easy markets.” Ramachandran adds. which account for over 30% of the world population. India and China) economies are growing at a rapid pace of between 8 to 10 %. It entered the Indian 6 | ISB insight | March 2006 . and ever-changing regulations increase operational costs and pose huge risks for global corporations. eager to gain a firstmover advantage in these ‘El Dorado’ markets. are typical of the problems faced in comparable markets elsewhere. 2003 he report quoted above has radically changed the way the world perceives emerging economies. As K Ramachandran. these economies see more economic. and are poised to overtake the G6 countries within 35 to 40 years in terms of their collective GDP Of these. that these economies have become the cynosure of every multinational company – from manufacturers of beer or cola. many multinationals have rushed into emerging markets. given the income disparities. Growing markets. The “BRIC” (short for Brazil. cars or credit cards. Philips India Ltd. cultural and ethical diversities. then. and the US by 2039. “All of them are heterogeneous in nature. Japan by 2015. In contrast. India is quite representative of the emerging economies. Many of them burnt their fingers as a result. The big brands already have a strong presence in these markets and many more are crowding in. points out. The numbers show why. . A case in point is that of the US cereals giant Kellogg’s. Russia. One common problem is that multinationals. India’s economy could be larger than all but the US and China in 30 years. are slated to be major buyers of the world’s goods and services on the strength of the growing prosperity of their consuming classes. and multinational experiences here. India and China alone. eager to gain a firstmover advantage in these ‘El Dorado’ markets. most developed markets are far more homogeneous. and will soon be tomorrow’s boom economies. simply duplicate the models that worked for them in developed markets. In this regard. Executive Vice Chairman and Managing Director. logistics inefficiencies.Understanding tomorrow’s tigers Emerging economies offer fabulous potential but only to those global companies that study them well “In US dollar terms. Over the past decade T One common problem is that multinationals. however. China could overtake Germany in the next four years. Besides. eager to claim the millions of prospective consumers newly liberated from planned economies and protectionist barriers. and a half. it is important to understand the subsets within the emerging markets. cosmetics or washing powder. Yesterday’s low-cost. What makes these markets tough to crack? Emerging economies have several things in common. Small wonder. dated October 1. simply duplicate the models that worked for them in developed markets. political and regulatory changes than the developed world.

It was only after heavy price reductions. Korean chaebol Samsung understood this very well when it used the proposition of good health to sell a range of white goods from refrigerators to washing machines. Ogilvy and Mather. the basic footwear market is all about hand-made sandals and chappals. Several of them – whether it is Nirma. Another risk emerges from the distance factor. Kellogg’s stumbled in China too. But equally. The two biggest constraints here – as elsewhere in the developing world – are price and product awareness. Second. And marginally above the commodity are the generic quasi-brand offerings. This is certainly an invaluable ability. Breakfast cereals are perceived as expensive. an innate understanding of the local consumer has given many domestic brands the edge. Indonesia’s wealthy ethnic Chinese. and detergents like Ariel. Also. an innate understanding of the local consumer has given many domestic brands the edge. True. brand expert and CEO.” This occurs at the level of the commodity. “These brands need to go against the grain of what is being dictated to them from Seattle or Boston. In Brazil. President Suharto had been toppled. Indeed. fast moving consumer goods giant Unilever sells Ala. the Chinese prefer their own cuisine for the traditional meals of breakfast. In India. but they are willing to try other products as snacks. These examples hold out a simple lesson for branding strategies of tomorrow. Paras or Chandrika – have posed a significant threat to multinationals over the years. which turned the cornflakes soggy and unappealing. the concept of convenience foods in India was new. but taking risks can also help companies garner a large market share. Just above that. a brand of detergent created specifically to meet the needs of low-income consumers who want an affordable yet effective product for laundry that is often washed by hand in river water.understanding the unique needs of the consumer in each emerging market. and yet to be accepted in a country in which less premium was placed on time. Bijoor gives the example of the footwear market. The company erred on two counts. they leverage a strong knowledge of the market to provide the local consumers a sound value proposition. March 2006 | ISB insight | 7 . such as the soap Camay. one of India’s top three personal care products companies. “He first decides the price. is the hawai chappal market.8% margins. It chose to give its Indonesian strategy a big push in May 1998.” This means multinationals have to re-engineer their business models accordingly. base commodity on offer. Paras or Chandrika – have posed a significant threat to multinationals over the years. As John Goodman. Most multinational brands. who are more likely to buy their products like Ariel. Procter and Gamble also learnt the hard way in India. First. Kellogg’s also failed to understand the breakfast habits of Indians. Indians largely prefer to eat their cereal with warm milk. Politically unstable economies are risky from the multinationals’ perspective. had fled Indeed. P&G now focuses on the upper-middle class urban consumers. just do not understand the language of localisation. Chairman and Managing Director of CavinKare. And this is . and then goes to the drawing board. and some “sachet marketing” that Ariel succeeded in picking market share.market in the early 1990s hoping to replace the puri-aloo and idli-dosa on the Indian breakfast table with high-priced cornflakes. at levels of 5 . and establish itself as a dominant player in the country. CEO–India and South Asia. It faced many problems trying to sell products that were successful in other countries. Since comparatively low purchasing power is another reality in these countries. P&G entered the market in 1984 through its subsidiary Richardson Vicks. Harish Bijoor Consults Inc: “One of the biggest risks comes from generic competition. Unlike most Western consumers. Several of them – whether it is Nirma.” adds Bijoor. part of their advantage accrues from lower cost structures. when the country was smouldering. CavinCare. As an example. “The biggest risk before multinationals is to make the economics of a product work in an emerging market. and then position their products. This is an unbranded. for instance. Concurs Harish Bijoor.” says Goodman. Goodman points to C K Ranganathan. says. CavinCare. lunch and dinner. addressing key problems works wonders. New entrants in the footwear business need to contend with these issues first. Take the example of Citibank in Indonesia.

Habits and market situations also play a big role in the success of a brand. It helps to have a local management since they best understand the business environment and the regulatory norms. etc. selective consumer testing. In India. This is where Citibank saw an opportunity. The 3. many Indonesians opened accounts with Citibank.(From the left) M Rammohan Rao – Dean. Later. In emerging markets. except in categories where the brand’s appeal is specifically its Western origin. it is widely believed that Korean . internationally. washing machines. Citi earned a 100 percent return on its $10 million investment in the new branches.000 to 3. But young men love to take their girlfriends to McDonald’s on dates since it offers an opportunity to experience Western food and concepts.. labour is cheap. So had most foreign bankers. people use bulbs for four to five hours only.South Asia. people leave their lights on through the day. Cultural issues are another risk multinationals need to keep in mind while devising their branding strategies. They want to buy Chinese goods. ACNeilsen . So dining out at McDonald’s with family members is not perceived as appropriate due to the foreignness of the food and the brand. According to Ramachandran.000-hour bulb will have a life of 10 years in India. and have enhanced lives. and that’s not required.000 hours. this can be dealt with by addressing the “perceived value” in the eyes of the consumer. ISB.Marketing. Citibank’s Asian retail business head flew down from the Singapore office and kept cash machines and electronic payment systems operating. The number of accounts rose 300 per cent from 1998 to 1999. “In Europe. SABMiller (India).500 hours. Citi staffers greeted Indonesian refugees at the Singapore airport with placards that read.000hour counterpart. The means of knowing a market are plenty – market research reports. seeking a local partner who understands the market and so on. Partha Rakshit – MD. Needless to say. This is why the penetration of washing machines is on the rise. Vinod Giri – Director . seeking views from experts and consultancies. however. and consumers are willing to forego convenience or time savings in favour of low price.Harish Bijoor Consults Inc. So. For instance.000-hour bulb costs a fifth of its 10.” he says. taking advantage of liberal new bank rules. For instance. So.” says Ramachandran. whereas in India. Dipak Jain – Dean. In the first 12 months of operations. their lifespan is 3. Kellogg School of Management. a 10. “If consumers are told that clothes washed in their washing machine are cleaner. The developed world laps up laboursaving concepts such as ultra-powered dishwashing detergents. the Chinese are fiercely patriotic. Philips had to design a bulb keeping the “save electricity” habit (driven by high power tariffs) in mind. Citibank opened 61 branches. In fact. Madura Garments the country. “Citibank will help you. This is how McDonald’s is positioned in China. Philips compact 8 | ISB insight | March 2006 fluorescent lamps come with a lifespan of 10. Harish Bijoor – CEO . softer. ready-made meals. they will buy it. and Hemchandra Javeri – President. Come here”.

mobile phones. washing machines. South Africa. Take rural India. This new mid-size car – Ford Ikon – is now sold in India. for instance. it is Nirma rather than HLL’s Surf that is actually consumed. as opposed to developed markets. March 2006 | ISB insight | 9 I C O V E R S T O R Y . It’s “glocalisation” that works for global companies. Advertising as an index will reveal that most multinational brands today are extremely local in their orientation – be it the Domino’s Peppy Paneer pizza. Take the example of Ford. or Sania Mirza selling Hyundai Getz. SAP Cisco etc) and B2B companies. packaging is the first differential that multinationals need to create for emerging markets. and consumers are willing to forego convenience or time savings in favour of low price. . And even in detergents. The exceptions are premium fashion labels. shampoos sold by multinationals come in smaller bottles in emerging markets. According to Partha Rakshit. “Every geographical market is a different market. Lack of communication or media reach is another problem. high-end cosmetics. Companies also try to penetrate the rural market through “sachet marketing”. And inability to provide them the best often leads to failure. Before that. For instance. Mexico and China. media reach and distribution network. companies LG and Samsung have succeeded in India because they used local talent. It entered the Indian market in 1997 in a joint venture with Premier Automobiles. Santosh Desai of McCann Erickson describes it as the “many Indias within India”. The car lost out to competition and the US car major was forced to design a product specially suited for emerging markets. In emerging markets. All the same. In fact. very rarely would you find a brand that is a leader in all the four geographical regions of India. television sets or washing machines.” says Rakshit. labour is cheap. however. ACNielsen South Asia. Most multinationals have chosen to go local in order to get a larger piece of the pie. “Things have not changed much since the 1980s in the rural areas. Italian carmaker Fiat also brought a dated product into India. India is a case in point. In fact. IBM. As he points out. Managing Director.The developed world laps up laboursaving concepts such as ultra-powered dishwashing detergents.” There are also stark differences between urban and rural markets in these economies. multinationals would be making a mistake if they assumed that emerging markets are not discerning. ready-made meals. etc. The challenge is in coping with the developing markets’ infinite heterogeneities. which came into the market with a dated product – Ford Escort – in 1996. consumers in urban India want the very best in technology – be it cars. Sachets give access to a product and raise the aspirations of consumers who then aspire to buy a larger unit when their purchasing power increases. Companies like Unilever and Colgate have tried to tackle that problem by putting video vans on the roads to show local movies with advertisements for their products. Today. three bottlenecks grip the rural Indian market – purchasing power. It’s only mass products such as soaps and detergents that have seen a rise in consumption. premium alcohol and IT products (like HP . albeit under different brand names.

outside of markets such as Moscow and St Petersburg. “The success of Ikshaa was made possible owing to the untiring efforts of a dedicated team of students who have put in much hard work despite their hectic study schedule. vans. barring the south. working capital and training in exchange for a commitment to exclusively distribute P&G products. Kellogg School of Management Girish Bapat – VP Marketing. This applies to intra-country markets as well. Speakers at Ikshaa: Dipak Jain – Dean. Hemchandra Javeri – President. Investing in the right kind of distribution in emerging markets is important. emerging economies – India and China in particular – are being viewed as the next Big Thing. The result – Fiat lost out in the Indian market. Then again. There was consensus on the view that the Indian consumer would be increasingly powerful in the future. more often than not.” said Aakash Shah. We are happy that the event has set a benchmark for future batches at the ISB. As of 2005. In the nineties. Class of 2006. it was the market leader in Brazil with a 25 per cent market share. Today. What was singularly noteworthy was the effort of students at putting together a top-of-the-line marketing summit. This is illustrated by Procter and Gamble’s strategy in Russia. In contrast. Multinational products would benefit from being multi-layered. Harish Bijoor Consults Inc. the picture is very different as the spin-off benefits of globalisation are making developing countries more prosperous. relevance and value to specific consumers count. Take the case of Coke. the Indian consumer was able to compare Uno with the other products. SABMiller (India) . generated valuable insights from a stellar list of speakers who were leaders from the industry. However. Madura Garments Partha Rakshit – MD. bringing relationship marketing to the fore. “Fiat sold a product that was inferior to the product they sold elsewhere. C O V E R S T O R Y Participants at Ikshaa 2006 Ikshaa – The Marketing Summit: Valuable Insights “Ikshaa – The Marketing Summit”. wholesalers and distributors. So. Those that learn to understand the needs of these consumers could well have found their El Dorado. This region has always had a different set of advertising. Soon. For multinationals struggling with marginal growth in saturated developed country markets. It rapidly expanded market coverage by appointing promising local distributors in whom it invested in terms of information technology.” says Goodman. Fiat is a runaway success in Brazil. Fiat had brand perception problems at the very outset. the rewards of developing a ground-up distribution are high. Fiat tried to sell the Uno in 1997 on the platform of “a secure and reliable workhorse”. and that every product would eventually become a service. P&G became the only foreign competitor across Russia. and academic gurus in marketing and in consultancy.Premier had a license to sell Fiat cars. using a mix of direct delivery. there is no defined rule that can explain why one product fails in one emerging market and succeeds in another. foreign investors realised that the middle-class had actually been over-estimated by a whopping 170 million. The “thanda matlab Coca-Cola” campaign ran across India. This is the challenge every multinational faces as it tries to penetrate emerging economies. you can’t have a dozen different strategies because the costs will be huge and the error quotient will go up drastically. the Indian middle-class was pegged at 200 million. followed by General Motors. Fiat Palio and Fiat Uno are amongst the five largest selling cars in Brazil. that the smaller towns in India would see tremendous growth. ACNielsen (South Asia) Vinod Giri – Director Marketing. So. The theme of the summit was “Marketing in 2020: Are Marketers Ready?” The summit brought out interesting perspectives from the speakers. shy away from. As a result. organised by the Marketing Club. So the “taxi” and “jalopy” brand perceptions were reinforced. While it is true that global brand values cannot change drastically across 10 | ISB insight | March 2006 I geographies. This is a challenge that multinationals. that the rural population would reduce considerably in numbers. Ikshaa. LG (India) Harish Bijoor – CEO. Co-ordinator. Desai points out that it is vital not to overestimate a market. which were mainly used as taxis. As competition rolled in.

and the “World’s Best Bank “ by Euromoney. and operations really have to be local.” As an indication of the breadth of its reputation. it cannot wave a magic wand and become local.” Recognizing the diverse languages of different parts of the world (see the following sidebar). “We adopted a global brand strategy only when we were quite sure it would be more powerful than local brands. But the global brand with a local strategy prevailed. People have to be convinced of that over a very long I C O V E R Strategies for S T O R Y .” he said. MTV India broadcasts primarily in Hindi. had been in use since the 17th century.” HSBC’s approach can be contrasted to Citibank. in 2004 HSBC was named “Global Bank of the Year” by The Banker magazine. iven the complexities of branding for developing markets. Telugu. how can companies best leverage their local and global brands to create opportunities? The following sections discuss some strategies. the dominant language of India. Five years after the launch of the global brand in the late 1990s. and current holder of the Harbin Centennial Chair in Business at the University of Texas in Austin. a strategy reflected in its tagline of the “world’s local bank. often 100 to 150 years. ”In most countries in which we operate. The HSBC logo may look the same around the world. “This was not done lightly. we are perceived to be a local brand. “The value of branding in a globalized world is enormous. HSBC was already rated among the top 50 global brands. and Kamini Banga is an independent marketing consultant. ”The main point in talking about a local bank is demonstrating to the customer that you are totally steeped in the local economy. Mehta said that this global brand was not established overnight.Harnessing Local Brands period of time. “Even if a company talks about being local.” he said. “In most of the geographies in which we operate. HSBC uses a decentralized management structure to ensure that local brands are responsive to their markets. which created a more homogeneous culture and retained its identity as a U. and Punjabi.” he said. but it faces competitors broadcasting in Tamil. which is the primary tongue of only 30 percent of the population. The company is considering launching or acquiring stations to reach listeners who don’t speak Hindi. recognized brand that is tailored to individual markets. Midland. we have been working there for a very long time. MTV has localized its brand around the world. Microsoft created a platform for localizing the language of its Windows XP software.S.” said Aman Mehta. Through its Local Language March 2006 | ISB insight | 11 This article is an excerpt from the book The 86 Percent Solution: How to Succeed in the Biggest Market Opportunity of the 21st Century by Vijay Mahajan and Kamini Banga. “Think Young”. as discussed in more detail in Chapter 5. former CEO. G Strategy #1: Make Your Global Brands Local Companies such as MTV and HSBC have shown the power of creating a global.” When HSBC decided to use a global brand. but this similarity masks the fact that it is seen as a local brand across more than 90 countries. in an interview. HSBC Holding Group Chairman Sir John Bond noted that the same telecommunications and other technologies that have brought developing market outsourcing firms to the developed world are bringing global brands back home to the developing world. adding that “brand value will be more profitable than the value gained through offshoring service jobs. “It has been a great success story in branding. One of the brands in the UK. intense debates resulted. In a speech in May 2004. the “Most Admired Corporate Brand” by Asiamoney magazine.” For the strategy to be successful. HSBC has to have a superior product behind the brand.” Mehta said. Vijay Mahajan is a former Dean of the ISB. bank.

It became the leading Asian juice drink in just two years. The company announced plans in November 2004 to roll out software in the 14 official languages of India. the company owned more than 400 brands in 200 countries. Coke has “taught the world to sing. These global sales are increasingly important to Coca-Cola’s future. built a growing business in China by acquiring shares in local brands and by developing products for China under its own brand. and a majority stake in Internet Auction Co. The Telugu-speaking area in Andhra Pradesh has a population of nearly 76 million people – a market about the size of Egypt. MTV envisions that the Indian market might be treated like Europe. The brand is still Microsoft.Vijay Mahajan – Former Dean.S. Its international strategy has been to look for “mini eBays.S. Although they are smaller than the total national market. about the population of the UK. a successful carbonated juice-flavored drink called Smart. Around the world. the French-based maker of cookies.” local companies that reflect the spirit of the original online auction company. In Africa. particularly in building a presence in a market. faced up to five years in jail or a fine of 100. Anheuser-Busch recognized the value of local brands in acquiring Harbin. 14 percent in Thailand. in Korea. Groupe Danone SA. will help Microsoft respond to the threat of open-source software such as Linux and expand the use of computers in these countries. the acquisition of Baazee in India. the company announced plans in March 2004 to develop Windows and Office software in 40 languages over the following year. a U. The manager. HSBC spent a century working with local brands in different countries before bringing them under the banner of its global brand. The company reported growth in China of 10 percent over the prior year and profits higher than the global average. Coca-Cola has relied heavily on local brands to go where its flagship brand could not go. the leader in the nation’s bottled water business. In China. and Harbin Centennial Chair in Business. After learning hard lessons with the initial missteps of EuroDisney. but the experience will be quite different for people in different regions. Austin Program. these local brands represented particularly important portals into countries with growing Internet presence and limited retail reach. Coca-Cola offers water and tea products under its locally developed Tian Yu Di (“Heaven and Earth”) brand. This tailoring of the brand to these local “markets within markets. Despite eBay’s strong brand recognition around the globe. This includes the acquisitions of EachNet and Baidu in China. While its 2003 sales growth was just 2 percent in the U. China had become its third-largest market. yogurt. ISB. and other parts of the world through local acquisitions.” but in different languages. As the market matures. sales grew 16 percent in China. China.000 rupees (about $2. and mineral water.S.” making it relevant. earning about 70 percent of its income from outside the U. and a noncarbonated juice drink called Qoo. The Tamil-speaking region of Tamil Nadu has more than 60 million people. By 2004.. with local beverages such as Sparletta. about equal to its sales in the U. Strategy #2: Use Local Brands to Establish a Market Presence Local brands can be a great asset. Disney realized that it needed to find a delicate balance between preserving the attraction of a distinctly American brand and tailoring the experience to local tastes. 22 percent in India. Hawai. and 10 percent in Mexico. the company sells 80 brands. Disney also consulted a feng shui master in designing the park. Plans for Disney’s Hong Kong Disneyland theme park call for local foods and programs in two Chinese languages in addition to English.S. By 2002. with different programs for different countries. building on versions in the Ethiopian language of Amharic and Ukrainian and other languages. The complexities for global companies in managing these local brands can be seen in the arrest of the head of eBay’s Baazee unit in India in 2004 after a pornographic video clip was offered by a seller on the site. University of Texas. these local markets are not small by any means. developed in Japan. and Splash. Its growth was driven by the acquisition of controlling stakes in Hangzhou Wahaha Group and Guangdong Robust Group. citizen.285) for violating India’s I C O V E R 12 | ISB insight | March 2006 S T O R Y . eBay has entered India.

Did the high profile of the parent brand contribute to the official attention? Strategy #3: Grow Your Own Local Brands When Possible As Anheuser-Busch found with Harbin. Nirma built its brand by recognizing an opportunity in the consumer shift from lowcost laundry soap to more expensive washing powder in the 1970s.S. For example. Wheel. To the extent that this foreignness may add value. While some local brands are based on century-old local dynasties. companies need to take care in rolling out brands in the developing world. the detergent brand Nirma was created in the 1960s by Karsan Patel. provoking significant price cuts by Coca-Cola and Pepsi. This brand was launched in 2003 with advertising featuring U. But global brands may be virtually unknown in rural areas.” The complexity of global and local branding can be seen in the success of Cola Turka in the Turkish soft drink market. The laundry soap market was large and growing. In India. where they are near the bottom of the food chain in luxury dining. the brand has 15 percent of the Indian detergent market. Hindustan Lever established its own lowpriced local brand. Managers need to carefully assess what the brands mean in different regions. but for different reasons than in the developed market. became one of the dominant brands in the country. the value added by a global brand is homogenized to one key value proposition – its foreignness. These products are purchased by customers who like the appeal of cola but object to “Coca-Colonization. Today. in the 1980s. it is possible to create new local brands that pay close attention to market needs. a chemist who made detergents in his backyard and sold them on a bicycle. Chinese customers were not amused by Kamini Banga – Marketing Consultant March 2006 | ISB insight | 13 I C O V E R S T O R Y . It was a decidedly nationalistic brand promoted by an American celebrity who sang a traditional Turkish Boy Scout song and a Turkish-language version of “Take Me Out to the Ballgame” in advertising spots. Their Western image raises the level of their brand among customers who want to be connected to the global village.Information Technology Act. Brands that may stand for certain qualities in the developed world may have a completely different meaning in the developing world. fast-food brands such as McDonald’s. Nirma moved into this local vacuum. This odd mix of local and global positioning led to a highly successful launch. Wheel. Strategy #5: Address the Liabilities of Global Brands While global brands appear to have many advantages – such as developed-world cachet and broad recognition – they also suffer from liabilities. while local rivals may be able to benefit from them. Strategy #4: Recognize That Brands May Mean Something Completely Different Global brands may lose something (or gain something) in translation. As well as aiding Quibla Cola in the UK and Zamzam Cola in Iran. Hindustan Lever and other major global firms concentrated on the high-income segment that was already using washing powder while most Indians still used economical laundry soaps. but no one was making an effort to convert users to washing powder. the brands may have value in developing markets. This new brand allowed the company to meet the needs of price-sensitive consumers without eroding the position of its established brands. with a freestanding organization. conveying little advantage. actor Chevy Chase (popular in Turkey for his National Lampoon movies). and KFC are considered upscale in developing markets. When a Toyota ad in a Chinese magazine showed a Toyota truck towing a Chinese rival up a muddy hill. In response to the success of Nirma and other brands. Companies often expect their established brands to be greeted with open arms as a sign of development – and sometimes they are. anti-American sentiments helped Mecca Cola challenge Coke and Pepsi among Muslim customers in Paris and other parts of the world. For example. acquiring local brands can be an expensive strategy. Multinational companies need to address these liabilities. Because of these differences in how brands are interpreted. Pizza Hut. In many cases. This is contrary to their image and reputation in the developed world. Global brands also have to be careful about attacks on local rivals and sensibilities.

and security. this impact should not be overestimated. Its marketing emphasized cavity protection over the whiter teeth that were important in the premium segment. Crest’s share of the middle market in China more than doubled from 5 percent to 12 percent from 2000 to 2002 while its premium products also increased market share from 5 to 8 percent. The court ruled that the logos were not that much alike and that consumers were not dumb enough to confuse Geely cars with pricier Japanese models. Toyota apologized and pulled the ads.“ who believe global brands. This builds awareness of the brand without violating rules against liquor advertising.” Local brands sometimes are helped by local distribution networks and regulators. Dubai’s Emirates Airline. The company launched a cheaper. “Global citizens. priced 30 percent below its premium brand. because the restrictions don’t apply to them. cents per serving. accounted for 23 percent of the market. But will its more countrified image in rural areas erode the brand among urban customers? Procter & Gamble was able to navigate this brand-stretching successfully in China. While typical Western advertising focuses on diamonds and other jewelry as a sign of caring. women’s apparel. In Islamic countries. These ads can be creative and effective. and Earl Taylor found that the “antiglobal” segment (not anti-American) constituted just 13 percent of the market.500 consumers by Douglas Holt. Similarly. As protesters are throwing rocks at American fast-food restaurants. A 12-country study of 1. offering small bottles and low prices of about 12 U.S. Advertisers work around this by showing silhouettes or women with their faces turned to the side. Strategy #6: Stretch Brands Without Breaking Them Companies also need to be able to stretch their brands without breaking them. Religious restrictions often require creative solutions to branding. One Coca-Cola advertisement for rural Chinese markets shows a popular comic actor drinking Coca-Cola and closing the ad with a burp. Instead. into the middle and low ends of the market.S. The company can market soda or distilled water under the same brand as the alcohol. Government regulators often side with the local brands over large foreign rivals. Although it is important to recognize the impact of anti-global and anti-American sentiments on the value of brands.” who see global brands as a way to connect with the global village. made up 55 percent. signal high quality. “Global dreamers. jewelry is positioned as an expression of wealth. While Pepsi has focused more on the cities.this direct attack on a local brand. This means that nearly 80 percent of the market continues to find value in global brands. Coke holds a 55 percent share of Chinese sodas overall. which positions Coke as a sophisticated drink for the rising middle class. jewelry. Chinese courts in Beijing ruled against Toyota when it charged that local competitor Geely had ripped off the Japanese car company’s marquee. who favor local players. such emotional appeals do not work in Islamic markets. prosperity. The challenge was to address these markets without eroding its urban image. compared to 27 percent for Pepsi. which held more than half of the high-end segment by 2000. their compatriots are continuing to purchase dinner there. a Nike television ad showing U. using its central location to become one of the I 14 | ISB insight | March 2006 C O V E R S T O R Y . or they use Western models. Surrogate brands can also be used to stretch brands. rural offering under the same brand. companies have launched surrogate brands. John Quelch. Coke moved out of the major cities in China and India to push deeper into the smaller cities and towns. The spot is in sharp contrast to its urban advertising. For example. It moved its Crest toothpaste brand. In 2004. and fashion accessories are advertised without using models because a woman’s face cannot be shown. basketball player LeBron James defeating a cartoon kung fu master and a pair of dragons was banned by the government for offending the “national dignity. Because of constraints on liquor and cigarette advertising in many parts of the world. using cheaper ingredients.

LG. Companies Do You Speak Hinglish? Think English is the language to know for business? Maybe not for long. in these rural villages. It may seem obvious that companies need to think about their branding strategy country by country and even local market by local market within countries. Consider that Mandarin Chinese has the largest number of speakers in the world . Bengali. What makes these brands attractive to this specific segment? . with about half as many speakers. global brands are more appealing. These local rivals have a significant advantage in distribution because their products can be found in the surrounding countryside. Hindi. and Russian. the 21st century may well be the era of “Hinglish” – a combination of Hindi and English used by Indian speakers. and Haier. but a mix of global. companies have used banner advertisements on elephants and video vans to build brand awareness. If you want to work with the 86 percent world. such as Samsung. Brands on the Run Branding in emerging markets defines simple formulas. such as LG Electronics and Sony. They offer diverse home pages tailored to different countries showing different languages. Colgate-Palmolive. One key is to understand the roots of success for products and brands that are already successful in each market and to recognize that brands may have different meanings in these markets. For certain segments and products. Whereas the company might fight for a share of the supermarket shelves in cities or developed markets. designed to introduce villagers in India to the concept of brushing teeth. competition comes from local preparations made from charcoal powder and the neem tree. and products based on the country’s specific needs. including secondlanguage speakers. Former P&G-India CEO Gurcharan Das has commented that if the 19th century was the age of British English and the 20th century the age of American English. Companies also team up with nongovernmental organizations (NGOs) to promote toothbrushing or other aspects of personal hygiene by combining product promotion with social action. need to develop a coherent portfolio of global and local brands. but even these need to be positioned and tailored to local culture and tastes. Such portfolios are apparent on the websites of companies with sophisticated global branding strategies. what a “good life“ means is interpreted market by market. In mediadeprived areas of the world. In contrast to this extensive tailoring. drives vans into rural villages to build brand and product category awareness. These vans.Strategy #7: Put the Brand on Wheels (or Legs) To develop brands in rural villages. and then Spanish. has worked around concerns about hiring Muslim women as flight attendants by relying primarily on foreigners. These markets are neither entirely local nor entirely global. While LG Electronics’ overall tagline “Life’s good” is the same. you need to speak the languages of the 86 percent. national. and local brands. The success of small local brands can build new national and even global brands. Even English is being affected by the rise of the developing world. for example. show half-hour infomercials on the benefits of toothpaste and then distribute free samples. The important thing is to recognize that markets tend to be more fragmented and branding and positioning more localized than in developed markets. customers. The portfolio of global and local brands should be shaped by the company’s brands and the demands and characteristics of specific markets within a given country. Companies need to become skilled at managing and balancing these complex portfolios based on insights from specific parts of the market. brands may rely much more on word of mouth and village leaders to develop the brand.a billion. some companies merely translate language or have only a local identity online. Arabic. March 2006 | ISB insight | 15 5 I C O V E R S T O R Y fastest-growing airlines in the world. This is followed by English.

and Jughead – none of which exist now. that branding is dead. Business schools. and arguably even more important than before. What was important was that the start-up had “eyeballs”: “page views” for its website. the Internet has reduced the costs of searching for information. to find the information you want as a shopper. Veronica. The Internet has had a big impact. Consumer I So what really changed? Did the Internet have any impact? I want to argue here that the answer is yes to those questions. and service – pre-sale and post-sale. 16 | ISB insight | March 2006 00 R 90 0R 80 R R R 0 0 1 1 12 12 12 0 R 0 80 . Take online retailing. Both revenues and profits would eventually come. Even business paradigms changed. The fight for market share became a fight for eyeballs. t has been ten years since the revolution began. ambience. It was back to the basics. Traditional bricks-and-mortar stores would disappear. Retailing can be described on several dimensions: product assortment. is Professor of Marketing at the ISB. Price-earnings ratios didn’t matter either. Investors realized that profits and price-earnings ratios were important after all. I browsed the Net for the first time in 1994. Shopping convenience and presales service take the form of how easy or hard it is to navigate the website. But away from the media headlights. Professor Sridhar Moorthy. How? From “stickiness” and “network externalities. and search engines with names like Archie.” Such were the assumptions behind the dot-com boom of the late nineties. and the impact is continuing. Everything would “converge. suddenly found that these courses had few takers. Gopher. All these dimensions are available to the online retailer for differentiating itself. the dot-com boom came and went. Some people have interpreted this to mean that the role of product and service differentiation has disappeared. of course. Its impact in the Indian context is perhaps years away. but the developed markets already present a case study of what to expect. As advertised. So would the differences between television and computers. which went into a tizzy creating Internet-based curricula. Investment in online enterprises didn’t require profits to justify. Neither is correct. Back then everyone was proclaiming how our lives would be changed forever by this new invention called the Internet. to the Internet. How you brand.90 0 R 0 Y 1300 Y 80120 Y 46 0 Y0 12000 6R Y 00 60Y 5 40 Y 030 000 5 00 Y 0 Y1 010 50 45 2 100 0Y 0Y 0Y 0 0R 01 2 350 0 0 40 Y 4000 Y Y 680 Y 4000 Y 60 0Y 68 R1 R 0 14 0Y 140 50 00 0R R1 80 60 0 00 R R 12 0R4 500 R 900 R 1200 R 600 120 00 R 1400 R 16 000 R 4500 R 40 Y Y5 0 The Emerging The author of this article.” We would all be shopping for groceries on the Net and watching television on cell phones. rather than whether you differentiate. own brands. The revolution is in The Emerging Consumer. I am referring. How you differentiate. and Manny Rotman Professor of Marketing at the University of Toronto. There were a handful of websites then. Well. shopping convenience. The browser was called Mosaic. The ambience of the website takes over from the ambience of the bricks-and-mortar store. Both of those concepts remain important. it is a quiet revolution. rather than whether you brand. What has changed is the nature of branding.

The advertising possibilities made possible by the Internet – banner ads. what is missing is the “hands on” “touch-and-feel” experience. For the manufacturer I would argue that branding and differentiation have become harder. spam and pop-up ads were the least trusted advertising media. In fact. The consumer on the Internet doesn’t seem to be open to be marketed to. and review sites (like Epinion). And when she watches television she is increasingly skipping the commercials. of course. Wordof-mouth is not a new concept. They were also the most annoying. Plus. They don’t have the richness of TV advertising – a requirement if you are trying to differentiate via imagery. TiVo-type personal video recorders are booming in North America. news groups. but what has changed is its scale and scope. There is even a name 0 14 9000 R$ 760 R Rs $8 20 0R 00 R $ s9 00 0 40 Rs 10 00 Rs 55 00 R s6 000 0R s 25 8 0 00 R Rs 1 s 1900 Rs 900 1400 20 Rs 0 00 0 Rs 100 900 s 0R Professor Sridhar Moorthy 0R Rs 5000 Rs 6000 Rs 5 50 0 R s 4 00 R 7 760 $7 $7 $7 0 R 00 $9 00 $4 0 R$ 49 0R $7 000 R $ 00 R$ 360 R$ March 2006 | ISB insight | 17 . But note well that the online retailer has to earn this differentiation. they have a bad reputation. and spam – are a poor substitute. and the instant gratification of the real store. A reputation for accurate product descriptions and a reputation for on-time delivery provide these assurances. They also provide avenues for differentiation and branding. discussion forums. how you perform on that first order will determine whether you get repeat business and good word-of-mouth. The reasons are twofold. but rather reading and writing – in blogs. which is rapidly losing its importance with the growth of the Internet. and its effectiveness as an alternative channel. The retailer has to provide good service in order to develop a reputation for good service. While advertising might get you the first order. They are talking to other consumers. the mainstay of branding for consumer goods for a millennium.0 Rs 00 R$ 360 R$ 60 0 0 R$ 18 00 0 The new word-of-mouth doesn’t look like the old word-of-mouth. In a recent survey by Forrester. pop-up ads. but this can be seen as a problem or as an opportunity. discussion forums. One of the chief attractions of these devices is that not only can the viewer timeshift his/her viewing. the consumer is browsing the Net. It cannot be done through advertising. Consumer media habits are changing. at the time it was promised. it doesn’t involve talk at all. and imagerybased branding has become almost impossible. In fact. What the consumer is looking for is assurance that she will get what she desires. its speed. but rather reading and writing – in blogs. The second reason branding has become more challenging is that advertising is not the only source of influence for consumers. The new word-of-mouth doesn’t look like the old word-of-mouth. First. and review sites (like Epinion). it doesn’t involve talk at all. Just enter the name of the product you are seeking information about into a search engine like Google and dozens of word-ofmouth sites pop up. I am referring to television. Instead of watching television. news groups. And you don’t need to know someone to disseminate your opinions or access theirs. Of course. she/he can avoid the commercials while watching her favourite shows. Take away television. a primary means of branding is losing effectiveness.

Broadband penetration is still in its nascent stage (only 3 million subscribers in 2005 versus 40 million in China). for this new generation of word-of-mouth: Consumer Generated Media (CGM). product placement in movies is growing. where the differentiation has traditionally been on imagery. That value becomes your brand. This is the reason trade promotion spending has exceeded advertising spending in the U. The retail environment is increasingly seeing the invasion of television. i. and personal video recorders are virtually non-existent. Already. Speaking of movies. Together with rising disposable incomes. The movement towards retailer-branded products. and that arena may be ripe for more advertising. For high-ticket items. Put it in conjunction with the decreasing power of television. a German retailer. Integrated marketing on multiple media is a necessity now. and as a marketer. for many years now (56% versus 19% of total spending in 2004 according to ACNielsen). The nature of brand-building changes as a result. and will continue to grow. But these may not be your most desirable targets in terms of revenue potential. the kind of branding you do in the print media has to be more factual and performancebased than imagery-based.. then you need to quickly find the means to become competitive or else… For lowticket items. you have big branding problems. But going forward. relatives and neighbours.S. What other means of communication can you access to reach the more promising targets? Print magazine readership. private-label shares exceed 50% in some categories. generates over 85% of its sales in private-labels. and hard to reach. may be more responsive to it. Put it all together.e. and hard to reach.” How does word-of-mouse differ from word-of-mouth? First. merchandising at the point of sale becomes important. Third. Instead of media advertising. private-labels. you may find solace in the fact that while fewer eyeballs are watching advertising on television. Here the retailer is king. 18 | ISB insight | March 2006 . Two-thirds of the respondents in a recent Arbitron study said they wouldn’t mind more advertising in the movie theatre. the consumer will research the Internet and find out what reviewers and other consumers are saying. Or you could call it “word-of-mouse. If you don’t provide good value. it would seem that the power of media advertising to create brands and move products has never been stronger. Integrated marketing on multiple media is a necessity now. apparently. of course. in many countries in Europe and North America. If you provide good value. then you have nothing to fear. That remains an avenue for developing awareness of new products and services and for brandbuilding. its reach is wider – you are not limited to your friends. is holding its own in the face of the Internet. it is faster. the ones who do. But will TV ads work as well in the noisy environment of a store? The movie theatre may be a more congenial environment. will continue as well. The bottom line is that the consumer is becoming more elusive. it would be hard to argue that The Emerging Consumer will not emerge here. Research indicates that they are likely to be the lower socio-economic groups. What to do if you are a marketer? One the one hand. but as is well-known. The Indian marketing environment is different. the point of decision-making shifts to the store. it is more organised. Aldi. Second. the neighbourhood kirana store still dominates retailing.I C O V E R S T O R Y The bottom line is that the consumer is becoming more elusive. and you have a potent new means of communication.

Singapore Management University. The focus of this research is not on selling product X to consumer segment Y in country Z. theory-building research that asks fundamental questions about the nature of competitive and consumer response. Somehow.” where the X or Y could be advertising. organising flash mobs. it seems inevitable to all of us. regardless of whether the environment is the emerging economies or the more advanced ones. Instead. Yet. or retailing. and Associate Professor Strategic Marketing. that if we do not do something drastic right now in anticipation of the future. becomes a powerful source of knowledge. then we will be crippled. And when business is defined in these fundamental ways. I recently heard a prominent American newspaper association spokesperson talk about how the newspaper industry had changed completely all over the world. Professor Seshan Ramaswami. or discount airlines. or marketing. the obsession to consistently worry about the future can also lead to ignoring the need to continue to improve our understanding of the basic principles of sound marketing today. but meeting the information and communication needs of the audience/ clients. However. often derided for “ivory tower” mentalities.” where the Z could be the internet. And that every new phenomenon will change the world forever. events. or inventory control. These are important trends. how advertising affects consumer memory. Academic research in marketing is a fairly young phenomenon. This article is based on his talk at the Diamond Jubilee Symposium – “Future of Advertising” – organised by the Advertising Agencies Association of India (AAAI). or the WTO implementation.An Academic Perspective on Measuring the Impact of Advertising in a Cluttered Environment The author. and whether in the year 1975 or 2025. and perhaps never will. or September 11. cease to exist. As do themes like “How Z Will Transform Your World. the focus is on understanding how various kinds of sales promotions work. or worse. abound in these fora. and are moving to many other innovative media like music videos. sponsorships. A seemingly permanent characteristic of management buzz on various fora is a focus on change and trendspotting. An advertising agency leader recently spoke to my students here at the ISB about how ad-agencies do not see creating television advertising spots as their main product anymore. and they are triggered by changes in technology and by how consumers seek information as well as get entertained. the specifics of the marketing challenges of a particular space and time. He also shared many examples of how newspapers were doing many different things to combat competition from other news sources. that the future will be very different in fundamental ways. focuses almost exclusively on that kind of basic research developing new theories as well as methods. most major academic journals in marketing being just 2-3 decades old. Not if they think of their businesses as not the printed word or the TV spot. or supply chain management. Academic research. etc. Themes such as “The Future of X. A corollary of that is. Surely. or how companies should respond to price cuts amidst rapid technological innovation.” “New Y Paradigms for the New Decade. On the other hand. but continued to see the print newspaper as his business. March 2006 | ISB insight | 19 I C O V E R Shouting Over the Fray S T O R Y . the basic nature of these businesses has not changed. he continued to define his business throughout as the printed broadsheet that the printing presses put out each morning! He spoke about all the other things that the newspaper companies were doing to combat the changes. we still have a lot to learn about the fundamental nature of competitive and consumer response. is Associate Professor of Marketing at the ISB. However. matter to a product or brand manager.

and test for unaided advertising recall right after the clip is shown. And this is a highly concentrated and quiet classroom environment which should maximise the possibility of accurate and full recall relative to the regular noisy television viewing environment. or of the brand with positive associations. The problem is acute in mature economies. and economic and statistical models of how both competitors and consumers respond to marketing activity. the brands advertised around the boundary. I routinely show clips of television programming interspersed with one pod of advertising in my consumer behaviour and advertising courses at the ISB. on transit modes including innovative uses such as Air Deccan’s use of the media of plane exteriors. there is such variance in the number of brands listed. which is not dependent on either the product or the locational context (whether emerging markets or advanced ones) or even on consumer segment. luggage hold doors on aircraft interiors. the various pop-ups and clip-art videos celebrating boundaries and wickets. the umpires’ coats. luggage tags etc. will not show up in the sales figures. I forced – yes. This is where academic researchers in marketing can contribute. In the emerging economies. Academic researchers begin with a theoretical base. as a consequence of these expenditures. The explicit recall of brand names. in signs that the stadium audience was holding up. This background of theory and methods allows them to contribute to a greater understanding of the effects of advertising even in a cluttered environment. let alone brand associations and advertising messages. There is plenty of money being spent on outdoors advertising. But increasingly. or even in the conventional ‘day after’ recall measures. distribution changes. They had to observe the placement of the various brands and comment about which brands were getting the greatest value for money. the scoreboard. 20 | ISB insight | March 2006 Consider the specific problem of advertising in a cluttered environment. They are endowed with a rich set of methodological tools. I . What is even more certain is that not more than a few of those brand names will be consciously recalled by even the most avid cricket viewer. emerging economies are beginning to face this problem as well. where many brands compete viciously for market share in a saturated industry. It is very difficult to measure the impact of these media spends on the long term equity of the brands being advertised. etc. The students listed anywhere between 12 to 40 brands in all. experiment designs. etc. whose availability in terms of advertising processing time or space has not increased. academic researchers are able to unearth effects of marketing expenditure which would be missed by the conventional commercial market research measures of unaided and aided recall and sales figures. The effects on building memory links of the brand with the category. and new television channels and internet websites continue to proliferate on a daily basis. For example. un-confounded by other marketing activity such as trade promotions. Their assignment was to track every single brand name that they were exposed to during that time – on players’ clothing. bats. it is a tough course! – my students to watch twenty minutes of live cricket programming during the recently concluded India Pakistan cricket Test series. More and more brands are fighting to grab the attention of the consumer. In my Advertising course. there have been two major newspaper launches in Mumbai in just the last few months.C O V E R S T O R Y Professor Seshan Ramaswami Armed with the rich base of theory and methods. is almost never more than 5-6 out of the 12-13 brands that get exposure in these clips. growth in industries is often accompanied by the rapid growth in the media businesses too. Conventional measures of sales and market share are unlikely to reflect the unique effects of the advertising spend. My own study during a Test match a couple of years ago in Chennai resulted in noting some 37 brands in a 30 minute period. It is interesting that even under conditions of concentration.

can be a great source for professional marketers to tap into to improve their arsenal. Yet. In a series of experiments. Their summary of multiple experiments in many categories reveals interesting results about the effects of advertising.I present three examples: The first is a paper by Angela Lee and Aparna Labroo. When someone enters a self service outlet like a supermarket or some of the modern self service retailers of shoes. Research focused schools like the Indian School of Business. packages may grab your attention and also evoke your liking spontaneously. A stream of research by Marnik Dekimpe and Dominique Hanssens uses data from the pharmaceutical industry. These experiments are enabled by split cable technology which allows the broadcast of a differentiated level of ad spend to different sets of consumers on a random basis.. packages may grab your attention and also evoke your liking spontaneously. Thus advertising exposures may affect your preferences even while you have little conscious awareness of that exposure. with some precision. March 2006 | ISB insight | 21 I C O V E R S T O R Y . and for the use of their arsenal of marketing tools. Here’s a sample result from their work: “each $1000 advertising shock generates immediate prescription increases of 70. the repeated exposure of the brand name in the background of the game in progress could lead to greater familiarity with. which amplify to 83 in the long run. and the two groups can be exposed to normal ad spend versus twice the normal ad spend. They are able to isolate. electronic items. There is significant risk in evaluating advertising expenditure only in the short run. someone exposed to a lot of cricket broadcast may have little or no conscious recall of the multitude of brands that she/he was exposed to. For example. models. certain brand names. models. the effects of such advertising. One illustrative finding is that concentrating TV advertising versus spreading it across a longer time period results in larger brand sales. every second household can be separated into a different group. etc. They evaluate the impact of advertising in medical journals using sophisticated time series analyses of data on ad spend and sales over a long period. etc. Armed with the rich base of theory and methods. electronic items. and also greater ease of processing that brand name in a competitive set. academic researchers are able to unearth effects of marketing expenditure which would be missed by the conventional commercial market research measures of unaided and aided recall and sales figures. which attract many leading scholars of marketing to teach as well as to participate in academic and industry research.. certain brand names. they describe how the “fluency” or ease of processing a brand name (or a logo or packaging) can lead to greater liking for the brand name. When someone enters a self service outlet like a supermarket or some of the modern self service retailers of shoes. Thus. is based on a series of advertising field experiments using split cable technology.” A third stream of work by Leonard Lodish and his colleagues. Getting a more sophisticated understanding of how the marketplace operates at a fundamental level can lead to rich rewards in the long run to companies that help to foster and fund such research.

22 | ISB insight | March 2006 .George W Bush. and David C Mulford. at the grand Atrium of the ISB’s Academic Centre. President of the United States. US Ambassador to India.

It was the first time that a US President had visited a business school in India. Dean. We took the opportunity to emphasise our focus on entrepreneurship and cutting-edge research. after the conclusion of the Roundtable with the group of entrepreneurs. ISB. To an audience consisting of members from the entire ISB community – faculty. The President was accompanied by US Secretary of State. “I am honoured to be at the ISB. For students of the Indian School of Business. who study the phenomenal turnaround that their country has made this last decade. Chairman of the ISB (Former Managing Director of McKinsey and Senior Partner Worldwide). “The ISB has emerged as a world-class business management institution within a short span of time.” said Rajat Gupta. and the emergence of ‘middle-class’ Indians as a precursor to the growing entrepreneurial might of Indians. President Bush’s interaction with the entrepreneurs focused on various aspects of Indo-US relations. and Rajat Gupta – Chairman. ISB (Past Managing Director McKinsey & Senior Partner Worldwide) “One of the reasons that I wanted to come to the ISB is that. the Chairman and the Dean of the ISB briefed the President about the history of the school. It is a new school using innovative tools necessary to succeed. Visits the ISB Condoleezza Rice – US Secretary of State. US Ambassador to India. This is indeed a prestigious event for us. At the Roundtable. and the world needs such examples to learn from.” he added. spoke of friendliness. it is certainly a shared excitement. It is a new school using innovative tools necessary to succeed. affable manner. Rajat Gupta. It embodies the essence of democracy.” he stated. 2006. “We are delighted that President Bush has chosen a premier management institution like the ISB for his visit. I had the honour of standing on the stage with your Prime Minister talking about a new relationship between the US and India. as I understand it. the growing importance of India in the global economy. Mr David C Mulford.” March 2006 | ISB insight | 23 . the civilian nuclear deal. and his entire demeanour. which was held at the Atrium of the imposing Academic Centre. who flanked the Roundtable on both sides – President Bush spoke on a wide range of topics that included free trade. “India is an important partner for the US not only because of trade and commerce. George W Bush. especially relevant to emerging economies. but also because it is a symbol of democracy and peace.” These words were part of President Bush’s opening remarks during his address at the Atrium. received the President along with Professor M Rammohan Rao. alternative sources of energy. as it is poised to break into the top order of the global economy. Dr Condoleezza Rice. and a few other officials. “One of the reasons that I wanted to come to the ISB is that. We highlighted the success of our one year post graduate management programme to the President. I am excited about our strategic partnership. President of the United States. staff and students. as I understand it.” said Dean Rammohan Rao. I’m equally excited about the future of India. outsourcing. First Lady Laura Bush joined President Bush later at the ISB. it is a Centre of Excellence in education. visited the ISB on March 3.” he said. President Bush’s easy. protectionism policy. Earlier. and about the remarkable progress that it had made since the five years of its establishment. it is a Centre of Excellence in education.I N SI G HT SPE C I A L President George W Bush T he ISB grabbed headlines the world over for a different reason recently. “Yesterday.

along with Rajesh Mani.” F President Bush addressing the gathering at the Atrium During his address. “It’s hard to teach people to be risk takers. This is a fact that the US recognises. as our country is undergoing a similar transition.” Earlier. Ruchi Bansal. says. he had told Professor V Chandrasekar. who. The US also identifies closely with India in this regard. He said. and you have professors here who give you the tools to be risk takers. owing to its own experience.” The Entrepreneurship Centre at the ISB came in for some special words of praise by the President. “The President’s meeting of young entrepreneurs is significant in the light of 24 | ISB insight | March 2006 . Executive Director. “You’ve got a great thing going!” Professor Chandrasekar says that globalisation has presented huge opportunities to Indian entrepreneurs by bringing their inherent creative and innovative capabilities to the fore. “It is in the interest of the United States that an entrepreneurial class grow in this great country. President Bush’s visit to the ISB was indeed a memorable event. entrepreneurship and development have always gone together in shaping the destinies of nations. “The President’s interest in the ISB students and young entrepreneurs here can be seen as a furthering of the knowledge partnership between the two countries. had the honour of greeting President Bush on his arrival at the ISB.The President’s Visit is a Memorable Event for the ISBians or the faculty and students of the ISB’s Class of 2006. President Bush referred to the growing importance of the Indian entrepreneurial class by saying.” he says. Wadhwani Centre for Entrepreneurship Development (WCED). “Historically.

and others.” says Rajesh Mani.” he adds. She also talked to the President about “compassionate capitalism” consisting of “providing venture capital funding to small businesses and social entrepreneurs so that they can sustain themselves. the White House included. Assistant Professor in the area of Organisational Behaviour at the ISB. Dishan Kamdar – Assistant Professor. One of the innovative initiatives that the ISB has undertaken involves the curriculum for its post graduate programme in business management. ISB. “In many ways. and told the President that she runs the social enterprise club with a lot of help from the faculty. and the student body of the ISB. “It’s a pleasure to be here at the ISB. it has gone from strength to strength in providing world-class business management education through its innovative initiatives.INS IGHT S P ECIAL (Seated from left to right in the foreground): Rajesh Mani – Class of 2006. the ISB itself embodies the very essence of the entrepreneurial spirit. or to work here as resident or visiting faculty. M Rammohan Rao – Dean. It is here that the ISB scores in terms of attracting expatriates who either come back to join school to augment a career shift. WCED. I think that the visit endorses the ISB’s focus on cutting-edge research especially relevant to emerging economies. “As the faculty representative from the ISB who greeted President Bush on his arrival here. March 2006 | ISB insight | 25 .” he says. Ruchi Bansal – Class of 2006. ISB. adds his perspective to the President’s visit. She is the President of the Net Impact Club at the ISB. It is mandatory for all students to undergo a core course in entrepreneurship irrespective of what they opt for in the advanced elective courses. V Chandrasekar – Executive Director. India’s large population of young people who are contributing to this transition through sheer dint of their creative energies. The school’s many achievements have ensured that it is on the radar of important institutions of the world. ISB. a student from the ISB Class of 2006 was part of the Roundtable for entrepreneurs addressed by the President. ISB.” Such projects use “a market based model rather than a traditional aid-based model. Ajit Rangnekar – Deputy Dean. ISB. Anjali Patel. Not many business schools in this part of the world envision a research-oriented thrust that is so essential for global business schools. ISB. the Entrepreneurship Centre. The course goes a long way in giving shape to the creativity and idealism in students. In just four years. Dishan Kamdar.” he adds. and to have visiting dignitaries such as the President of the US.” she explained.

and also the most popular. India’s leading cricket broadcaster and television personality. Harsha Bhogle is easily the most recognised name in cricket broadcasting. India is largely a single sport nation. Bob: Yes. I use my sporting background to say that it’s important to have that link between the practice of sports and the study of it. Doordarshan. I know that active Sportsmen don’t care too much for researchers or academicians. It’s interesting that you made the transition. I’ve had to convince people that sport is a serious area of study. ESPN. and some of the more commercially driven popular clubs. Harsha: You were once an ace footballer. Melbourne. nor enough professional sportspersons. Associate Professor in Sport Management and Policy Programme. giving them facilities. The idea that well known sporting 26 | ISB insight | March 2006 I organisations around the world have a strong brand name is an important issue for analysis. or the most visible sports. we are full of what people might loosely call ‘low demand’ sports where there isn’t enough funding. conducted by the Centre for Executive Education (CEE) at the ISB. I have taken a while to carve a strong economic niche. We have driven them with support. we have targeted a number of sports. worldwide. in collaboration with Sports Knowledge Australia (SKA). Trans World International (TWI). A number of sporting organisations around the world. This has .E D U C A T I O N Learning Lessons from Australian E X E C U T I V E Sport Management Harsha Bhogle Interviews Bob Stewart In this feature on Executive Education. He has worked extensively with the British Broadcasting Corporation (BBC). do we seek government help in managing ‘low demand’ sports. and Professor Bob Stewart. but with some difficulty. and student scholarships etc. and therefore there isn’t adequate viewer or spectator interest. Victoria University. particularly because of increased commercialisation and globalisation of sport. In your experience. It’s beginning to become a major area of interest. because in academia. They exchange notes on how an emerging economy like India can learn from the experience of Australia in managing sport. I wonder if sport requires brand management across the world. some of which aren’t necessarily the most popular. are now seeing themselves as an important brand. and the Australian Broadcasting Corporation (ABC). We have ensured overseas exposure to improve the profile of the sport. we present the perspectives of two eminent personalities connected with sports – Harsha Bhogle. such as cycling. sports isn’t often treated very seriously. and for bettering performances at international competitions. Bob Stewart was the faculty for the first ever programme in Asia on Sport Management. Brand management is a subject of study in all B-Schools. or focus only on managing “high demand” sports like cricket in India. and football across Europe? In Australia. Star Sports.

and also the training of professional managers. when it could be taken away from education. then the other two develop weaknesses. nor enough professional sportspersons. the government tends to take its job further. I have first-hand experience of seeing this happen in India. the private sector provides funds. and that leads to a lack of accountability. it’s also important that you have advisors from the private sector that provide additional funding and facilities. While we have been fortunate in having a good balance of the three sectors. Australia stands next to Great Britain as the world champions in track cycling. the civil society or the “volunteer sector” provides enormous amount of labour and the human resource for sport. It has also been a part of our history. One other dilemma in developing countries like India is that while a certain sport like cricket generates huge interest and money. from the days of colonialism. and leave the running of the sport to somebody else? While government funding is crucial. Maybe. Harsha Bhogle at the ISB brought in regular attendance from the crowds. How can the promotion of sports work in developing nations where sport has to constantly compete with other overriding requirements such as education? Australia has always valued sports as part of our popular culture. Another problem that we currently face with being so cricket-centric in India is that there is cynicism about the kind of media attention and corporate assistance that cricket gets. Do you really have economic development first. we are full of what people might loosely call ‘low demand’ sports where there isn’t enough funding. and run the sport as well. In some respects it’s a chicken-or-egg situation. the government should provide the infrastructure. before we can March 2006 | ISB insight | 27 I E X E C U T I V E E D U C A T I O N . In Australia. we have quite a good balance in three fundamental sectors: the government provides the large physical infrastructure. The government believes in funding and running these other sports in a bureaucratic manner. for other sports where the government is providing infrastructure. and lastly. and a lot of opportunity because of low population. There is a reasonable India is largely a single sport nation. But Australia has the advantages of a lot of space. while the other sports are not cared for. with developing countries it’s hard to convince government officials that money should be put into sports. and therefore there isn’t adequate viewer or spectator interest. Certainly.put resources into sports. and also assist in the running of major events. The government has a critical role to play in all this. or vice versa? That’s one of the strong dilemmas that every developing country faces. manages events. for others. if you have one of those bleeding.I don’t know whether other developing countries experience this. health policy etc. Today.

the amount of money in Indian sport is low considering the population vs. In Australia. Australia is not like the UK. For instance. It turned out to be a flawed piece of statistics. two major publishing houses. Wealthier countries dominate international sport because they have the economic foundation to provide the resources. has a single sport broadcasting contract that earns it well over 120 million dollars per year from television channels that broadcast the sport. and there is a feeling that it may actually end up harming the sport. the body that runs the Aussie-Rules Competition. and also assist in the running of major events. Victoria University. we have a paper in Melbourne called the Herald “While government funding is crucial. and do not look for sport planning.Bob Stewart. then the government will not provide money for future development. If there is chronic underachievement. the government supports the lesser sports by providing a financial base. It works quite well. We need to make a concerted effort to ensure accountability and transparency – two very important aspects for a sport development system. find it hard to make ends meet throughout the year.” 28 | ISB insight | March 2006 . but the games are run so poorly that we keep slipping down the international table. The media clearly plays a huge role in developing sports. or even India – a big media country. Quite a few studies undertaken by economists around the world suggest that there’s a very strong link between the population. There’s far too much money. If the outcomes are achieved. In terms of media outlets. we have a problem of plenty in cricket. and do well in that area. the prerogative of developed nations? The developing countries have more pressing needs to fulfil. and international sport success. as with the Aussie-Rules. Do you have a problem of plenty in Australia. or put resources into that one local sport that the population is good at. then the administrators of that particular sport are held accountable. there’s just the state run radio that I know is big. but has now gone into a free fall because of the lack of accountability that comes with government run sports. One way to break the cycle is to target just 3 . Can too much money actually harm a sport? The Australian Football League. be looking at 11 medals. it’s also important that you have advisors from the private sector that provide additional funding and facilities. Melbourne amount of money in football and hockey. This is a worldwide dilemma. medals equation. Associate Professor in Sport Management and Policy Programme. I wonder how Australia tackles this. or the US. for example? In India. Most of these 120 groups of smaller. Most developing countries don’t enjoy the same advantage. considering that it is relatively a “low media” country – just five media channels that have got to have the soaps. when the government provides funds for anybody. because effectively. and the sports on all the channels. That’s true. Somebody said that given India’s GDP we should . the news. having worked a lot over there. You probably know that Indian hockey was at a fair peak many years ago. and no more than four or five really national newspapers. Then work to coordinate the base.4 sports. and how it should be used. Some people talk of the link with GDP and Olympic medals. In Australia. This is in stark contrast to the 120 other sporting bodies in Australia – out of 130 – that get virtually nothing through TV broadcasts. Is large scale planning of sports then. We have few media outlets. or non-popular sports. but we do have very strong emphasis on sport broadcasting. there are very clear expectations about what the fund is for.

And that is one of the weaknesses in the system. Most of them would die for the amount of coverage that football and some other sports get. Professional player management is now an important part of sport management. The Indian corporates are growing to global competence. The other requirement remains the balance of government. I predict that the new hub of global sport will be the AsiaPacific region.? Is player management largely entrepreneurial. and have very little left at the end of their sporting careers. and offer the job to leading Indian corporate houses. The Commonwealth Games coming up in Delhi in 2010 could provide tremendous development to Delhi. The Australian Open has now regained its importance as a Grand Slam event. In fact.20 years from now. Every small country town has a tennis court – that’s part of the sporting fabric of the country. One requirement for sports development is a stable political and economic environment. At Melbourne. and civil society for the development of sport. your sports will also take off. 15 . it is actually used. you will have a sporting structure on a large scale. when football is popular. this is a great way of putting a city on the world map. they allocate up to 40 pages for sport coverage. They accept the fact that they will always be seconded. Did the government do that in a spirit of philanthropy. we did a 450 million dollar redevelopment where we created a multifunctional park that is now mainly used for football and cricket events. the government didn’t make too much money. So. What about media coverage for the non-commercial sports that the state is trying to promote? There isn’t any coverage for those. To some extent. They can be asked to adopt a sport each. As a result. I hope that happens. or is it a glorified one-man shop? Several athletes and sports persons have managers to look after their financial and personal affairs. The government’s limited funding ensures that they have a strong base. but currently we are far too dependent on the government. The flagship stadium – the Jawaharlal Nehru Stadium is in a sad state now. But. What is your view on how sport is evolving in Asia based on the delegates you’ve met at the ISB? India has huge potential. But soon after that. You have a huge population. we almost did a Montreal where the facilities were hardly being used for a long time. and can pay for itself in 10 – 20 years. Even a high profile sport like Tennis in Australia wasn’t producing top players for almost 10 years. as you become more materially well off. How has it been possible? We have always had a tradition of tennis in Australia. my suggestion is that the government gets itself out of sports after a two-year notice period. a lot of people play tennis at least casually. particularly at the professional level. Actually. but now there has been a resurgence. Perhaps. How do we deal with the other more visible part of sport management – the management of sports players – liaising with networks. I can see that happen for the commercial sports like the Aussie Rules. In the winter months. You have got an enormous growth in general economic activity. and actually make money out of the allied business generated? That’s a very good question. The resurgence is due to the government pitching in with investing millions into the infrastructure called the Melbourne Park for the Australian Open. and has little time. and they even achieve some level of international success. Actually. there seems to be no point in having white elephants. that happened during the Asian Games in India in ‘82 – ’83. Let me remind you of one important point. which is focusing on more foreign investment into Indian industry. or on the issue of terrorism. and to India in general. But it’s a fact of life. or the inclination to promote sport. as a lot of players make a huge sacrifice with their education. It’s becoming very important to provide for the long term wealth of the players. etc. which has got the Australian Open back as a big event. but the city of Melbourne benefited majorly by attracting tourists. private. It didn’t cover all its costs. and be given tax incentives for it. Yes. even though there may not be international success. But apart from Lleyton Hewitt. It led to a huge television boom because they had to showcase India. and when you have got that. big money athletes requiring individual management. we can make sure that once the infrastructure is created. I hope that it changes. the Tennis and the Rugby League. I hope that it happens! March 2006 | ISB insight | 29 I E X E C U T I V E E D U C A T I O N . or did they hope to recover the investment. where there’s a consumer pull anyway. and will have a smaller share of the resources. we haven’t produced world champions like we did 20 or 30 years ago.Sun. Yes. It is a specialised and growing area. we need to see what making money really means here.

I W hat does it mean to be in politics? What would motivate young Indians to join politics? What are the downsides of being in politics? Six eminent panellists avidly debated these questions in the discussion – “Youth Participation in Politics” scheduled for the forenoon programme of ILS 2006. and better politics. He had experienced all these difficulties even though he belonged to a political family. provided the only platform to the nation on which diverse and conflicting issues could be resolved. Jayaprakash Narayan said that politics. Rajya Sabha. was the curious vulnerability of the elected politician. Chairman.S U M M I T L E A D E R S H I P (From the left): Dr Jayaprakash Narayan – National Co-ordinator. Gemplus India Pvt Ltd. CNBC TV18. The panellists were: • Sandeep Dikshit. The highlight of the event was the presence of active politicians – one from the Lok Sabha. “The only antidote to politics is more politics. providing a unique platform for inspiring thought leadership on the theme “India Next”. CEO. as the profession empowered one to make desirable changes. Madhav Mehra. • GK Sood. to 60 in the current one. apathy is detrimental to India’s cause. Louis Dreyfus India Pvt Ltd. The speakers were all eminent leaders and young achievers. delivered the keynote. Dr Chandan Mitra – MP. Chairman. despite its disrepute. “Though everybody loves to hate politics. Ex-Chief Corporate Editor. and Sandeep Dikshit – MP.and a former bureaucrat turned social activist. Ranbaxy Laboratories Ltd. who collectively lent important insights to the agenda. President. ISB and it could be considerably “dark and secretive”. The figure had declined from 162 in the 2nd Lok Sabha. was the Moderator. Member of Parliament. Rajya Sabha • Jayaprakash Narayan. What lingered in students’ memories long after ILS 2006 concluded. The panellists were: • Satish Reddy. The panel debated upon Corporate Social Responsibility. and the inspiring words of the social activist who stood up for greater youth participation in politics.. Dr. he found it necessary to engage in politics in some way or the other. and Govind Ethiraj. Assistant Professor. Yet. Be a part of the solution. Member of Parliament. Managing Director. East Delhi Constituency • Chandan Mitra. Loksatta. delivered the keynote address. NIIT. In the words of Jayaprakash Narayan. and another from the Rajya Sabha . Sandeep Dikshit gave a first-hand account of the difficulties of an elected politician. there was no defined process for getting into the profession. with active participation from the audience. • Vijay Parthasarathy. 30 | ISB insight | March 2006 . Not a part of the problem. World Council for Corporate Governance. Lok Sabha ISB Leadership Summit 2006 India Next ISB Leadership Summit (ILS) 2006 was a conclave of political and business leaders. while Rajendra S Pawar. no clear or specific path. He said that there were several “entry barriers” to politics. Reddy's Laboratories Ltd.” he said. moderated the discussion. Chandan Mitra was concerned about the declining number of youth (aged between 25 and 40) getting elected as MPs. Social Activist • Mudit Kapoor.” Tejendra Khanna. MD & COO. The afternoon discussion had more “practical” issues to discuss in “The Synergy between Government and Business”. Economics and Public Policy.

including the BRIC report. to enable it to strengthen its position as the premier finance research centre in the Asia-Pacific region.. and those who don’t know what the heck they want to do!” That was Lloyd Blankfein making light of his tryst with law before switching to the finance profession. “In the US. India was currently a destination for direct investment by many indications.” And what about Goldman Sachs’ presence in this Garden of Eden? Blankfein referred to Goldman Sachs’ joint venture with Kotak Mahindra.. Wealth-creation was “a bit like the mythological Garden of Eden – once you have tasted the fruit.India on a High Growth Trajectory Lloyd Blankfein. you can count the crises that I’ve lived through.” he said. addressed the ISB students on the occasion. His experience at Goldman Sachs was akin to an ageing tree. by saying. recently announced a grant of $1 million to the Centre for Analytical Finance (CAF) at the ISB. Centre for Analytical Finance (CAF). He summed it up in his inimitable way of simplifying the complexities of his profession. and said emphatically. you could “haggle” about the “allocation of the wealth that gets created from globalisation. and then work his way up to where he currently is. Lloyd C Blankfein. (From the left): Professor M Rammohan Rao. attributing it all to being in the right place at the right time. you have only two kinds of people studying law – those who want to practice law.” Over the years.” he explained. which he described in some detail. The Goldman Sachs Foundation. Goldman Sachs Group Inc. The funding is meant for research and faculty for CAF. Dean ISB. though they knew that they were open to new ones.. Of particular mention was the traumatic upheaval of the 9/11 crisis. and learning to avoid familiar ones. T H E G U R U . President and Chief Operating Officer.” he said. “Just as you count the rings of a tree to determine its age. and Professor Sankar De – Executive Director. President and Chief Operating Officer. The following are excerpts from his address. but nobody is haggling about whether the wealth is being created. ISB March 2006 | ISB insight | 31 I F R O M Lloyd Blankfein. “Considering the size of the Goldman Sachs balance sheet and the size of our equity. “We want to have an important business here in India.” Moreover. President & COO. and the country was on a “high growth trajectory. Goldman Sachs Inc. Blankfein “broke free” from the “gravitational pull of law” to take up an entry-level job at Wall Street. “I entered the international business just at the time that the business was internationalising. And the man remained modest despite the heady success. The Goldman Sachs Group Inc. Lloyd Blankfein – President and COO.” I n one of the most inspiring success stories in the corporate world. Goldman Sachs Group Inc. to their company’s upcoming operations in Bangalore that tapped the rich “talent pool” available in the country. a key strength developed at Goldman Sachs was in anticipating the crises. it’s hard to go back. a global philanthropic organisation funded by The Goldman Sachs Group Inc. we do live nervous lives.

because of its strategy to allow the customer to walk into a retail outlet. Today. Jenson and Nicholson.e. already had small cars that were fuel efficient to some extent. Adidam quoted several interesting cases involving leading companies to explain how Competitive Intelligence (CI) analyses have made them what they currently are. So. were selling huge cars that guzzled tonnes of petrol. by gaining valuable first-mover advantage. The Japanese. or offering new products or services on the Internet. There’s also this interesting case of guitar manufacturers. No doubt. Asian Paints has vanquished other companies in the paint industry such as ICI Dulux. made headway in Japan. considering their geography. as well as the right product. They had a ready channel of distribution in place. and basing one’s own reactions accordingly. But Kodak managed to gain some ground despite its losses by upstaging Fuji in gaining first entry into the disposable camera market that’s worth around 14 . Honda. any of which could completely undermine your existing strategy.Competitive Intelligence for Staying Ahead in the Market Phani Tej Adidam. and find paint of the shade that they want. The world’s 32 | ISB insight | March 2006 . if you wanted a particular saffron shade in a small size. the three big automakers in the American market. Asian Paints has gone on to build a huge customer base. Thus Kodak. ost companies in the Indian marketplace are obsessed about their customers. They were able to cater to approximately 30 – 33% of the market within four years. which was Fuji’s home country. and Datsun – now Nissan – came in. We present excerpts form his talk. and in fuel efficiency research. In the Indian context.. you could get it at Asian Paints. They now invested money in developing their distribution channels. Kodak has the larger share of the market. Executive Management Education. But the Japanese foresaw that there would be a fuel crisis. Department of Marketing and Management. It had also lost about three billion dollars in law suits to Polaroid in the instant camera market. This could be with regard to the competitors entering new markets. In the fifties. Professor. Predicting your competitors’ moves. whereas the Japanese had a market oriented philosophy. and in the size that they want. anticipating their actions. six months to two years from now. and not compromise on either the shade or the size as you would have to elsewhere. where Polaroid had several patents. an American company. By 1968. GM. calls for some sophisticated knowledge. His talk dealt with the subject of tracking competitors’ moves in the market. while buying paint from a competitor’s retail outlet. and lead the market for the paint industry in India. There is also the example of Kodak and Fuji. cutting prices. for a successful marketing strategy. The demand suddenly increased.15 billion dollars globally. Their philosophy was completely product oriented. but they need to focus on Competitive Intelligence (CI) as well. worldwide. i. spoke on Competitive Intelligence at the ISB. University of Nebraska at Omaha. Kodak had lost out on its film rolls market after the arrival of the digital M camera. Ford and Chrysler. That’s the kind of amazing success story that CI analyses can bring. Toyota.. between 1970 and 1974. Berger etc. followed by Fuji. Asian Paints’ CI analyses made them aware of the customers’ predicament in either compromising on the shade or the size. This caught the American automakers completely offguard. Kodak’s CI regarding Fuji’s intended forays into the disposable camera business prompted Kodak to revive its own research on disposable cameras that it had shelved because it had earlier thought that the model would not sell.

Samsung’s CI analysis forecast the Guitars Manufacturers Association of America (GMAA) going to the International Trade Commission to seek relief from high tariffs. INTEL sent a team to Taiwan and found out that the company had a small research lab. and that could. and then send it to their centralised database. and the competitors did not gain from the protection accorded by the Trade Commission. leave alone being a subject that attracts research. no doubt. perhaps. Though it is practiced loosely at various levels.largest manufacturer of guitars is Samsung – a little known fact. CI can also lead to the discovery of potential competitors that are on the periphery of the industry. What it means to be an INTEL employee is that you would have to read all the journals. invariably keep repeating in their database at regular intervals. as it is crucial for crafting existing marketing strategies to emerge successful in the marketplace when launching new products. it is not approached as a subject deserving systematic study. but INTEL focuses more on those unknown companies that pop up once in a while. undermine Samsung’s pricing strategy. trying to come in. After seeing the pattern for some time. Samsung are “OEM” manufacturers of guitars which are branded by others. Most of the familiar names in the industry. give you a lot of trouble in the future after they have actually managed to get in. It is not yet a subject of study even in major B-Schools across the country. scan it. there was a company in Taiwan that kept popping up on the database about once in six months. They were actually trying to patent some of the technology that they had developed in the area of semi-conductor dust. INTEL inked a contract that bought 48 – 49 patents from the small company’s lab in the year 2002. The tariffs were eventually withdrawn in just two years as against the usual three years. and news in the media relating to the semi-conductor industry. You are expected to clip it.8 billion dollars in revenue. it deserves more focus. This is done with a view to track new technology. But Samsung’s forethought of importing huge stocks at the old tariff ensured that it suffered only a marginal 2% hike in its pricing. does not receive as mush focus as it should in India. or when entering new markets. INTEL is a company that encourages almost every employee to be a CI specialist. This protection would. There were three other guitar manufacturers in the US who were affected by Samsung’s lower pricing strategy. To be more specific. and was seeking additional funding. Five out of these patents have already given INTEL approximately 1. Samsung continued to sell guitars at its original rate for the next two years. The revised tariff would have had Samsung’s costs go up by 17%. March 2006 | ISB insight | 33 . Clearly. This was thus a case of pre-empting a competitor’s moves through successful CI. But Samsung dealt with it by importing huge stocks of guitars from Korea and elsewhere to last three years of sales just before tariffs were slapped. Thus. Competitive Intelligence as a subject. and had done tremendous research in their area.

with initiatives such as introduction of prudential measures. he maintained that “India is on the move. Despite these achievements.8 % – a record yet to be regained. ISB. According to him. the mechanisms for risk assessment and management in banks have not yet achieved global standards. greater competition to public sector banks. and with funding support from Karvy Consultants. the growing rates of savings in both household and 34 | ISB insight | March 2006 . This year. or was crawling since the 1990s. Yale University. we have Bad News. Deputy Governor. when growth rate peaked at 7. Reserve Bank of India (RBI). In terms of growing from where we once were. The banking sector came in for some praise by Srinivasan. “India’s is a Good News and a Bad News story.” He concluded that the reforms process had either stalled. and longer maturities and trade volumes. Professor of Economics.” He quoted statistics of 40% plus corporate profit after tax for eleven quarters. Senior Fellow. and Samuel C Park Jr. in collaboration with Satyam Ltd. Other praiseworthy achievements mentioned I were improvements in the government securities market in terms of market size. there was ample food for thought for the audience. and particularly in comparison to the achievements of countries like China. making his presentation – Status of Indian Economic Reforms: A Hiatus or a Pause before Acceleration? He agreed that India was presently in an enviable position among developing countries owing to its growth rate. and the other in the winter in India. Rakesh Mohan. delivery versus payment system etc. the success of Value Added Tax (VAT) and the growing number of states that have accepted it. we have Good News. Typically.Speakers at the CAF-SCID Conference The Current Status of Indian Economic Sector Reforms The Stanford Center for International Development (SCID) recently invited the Centre for Analytical Finance (CAF). the economic sector session of the winter conference was jointly hosted by CAF and SCID. He questioned both the direction of policy and the efficiency of implementation in the reforms process. stoically defended the reforms process. lower yields. But in comparison to what we could have been. and an acceleration of the process was absolutely essential. The proceedings began with T N Srinivasan. to be its partner in organising the economic sector reform part of its famous semi-annual conferences on India. Regardless of any perceived lapse in policy or in implementation. Stanford Center for International Development (SCID). SCID organises one such conference in the summer at Stanford. But he was critical about the lack of effort in sustaining the momentum of growth achieved in the initial postreform years. s the glass half full or half empty with regard to the current status of the Indian economic sector reforms? With six eminent speakers presenting their respective expert opinions at the recent CAF-SCID Joint Conference on “Indian Economic Sector Reforms: Current Status”. deregulation of interest rates.

with pride. disclosure standards. Government of India. felt that the regulatory structure of capital markets was fragmented. Several policies such as the ones relating to development of infrastructure. and particularly in comparison to the achievements of countries like China. He also moderated the panel discussion that followed the individual speeches. S Narayan. as landmark achievements. he felt. He acknowledged that there had been slowdowns in the growth rate both in 1997 and in 2000. And the conclusion? Whether half full. focused on the need to develop the commodity futures market. former Chairman of Securities and Exchange Board of India (SEBI) and former Chairman. for instance. The panel discussion saw some enthusiastic participation from the audience. Founder-Director of India Development Foundation (IDF). But in comparison to what we could have been. This must. were in the implementation of policy. to a large extent. which was a reflection of the overall success of the conference in providing some interesting perspectives to the assessment of the current status on India’s economic reforms. ISB. Yale University Speaker T N Srinivasan Rakesh Mohan S Narayan G N Bajpai Shubhashis Gangopadhyay Sankar De Topic Semi-annual update on state of reforms Comment on semi-annual update by TNS Government’s perspective on reform Capital markets reform Commodities and derivatives markets reform Impact on reform on corporate sector financing March 2006 | ISB insight | 35 I C E N T R E F O R A N A L Y T I C A L “India’s is a Good News and a Bad News story. The problems. He also noted. and the recruitment of 5. Sankar De. Shubhashis Gangopadhyay.3 million cell phone users each month as indicators of the buoyancy of the Indian economy. Executive Director. LIC. we have Good News. but the major resurgence after 2002 had been making up for the earlier slowdown. Centre for Analytical Finance (CAF). and Samuel C Park Jr.000 people in the IT sector in the city of Chennai alone. that while there had been banking sector collapses in about a hundred countries around the world. India’s implementation of accounting policies. “We have run out of the easier things to do. former Economic Advisor to the Prime Minister of India and former Finance Secretary. the Indian banking sector continues to remain stable. G N Bajpai. T N Srinivasan. or half empty. In terms of growing from where we once were. presented a detailed paper on the impact of reforms on corporate sector financing. Senior Fellow. but had not yet seen implementation.corporate sectors. we have Bad News. He quoted the crossing of the $100 billion mark in exports. which had the potential to be a USD 600 billion market. decided to tread the middle path by focusing on the government’s perspective on reforms. and even the addition of 2 . He highlighted the fact that the entire world was now looking towards India for trade opportunities. be attributed to our more efficient use of resources compared to several other growing economies. Professor of Economics. We now need to work on the more difficult ones. and corporate governance practices would enable India gain recognition as a success story on a global scale. Stanford Center for International Development (SCID). the fact remains that India has just about reached the half-way mark in the economic sector reforms. were formulated quite some time back.00.” he said.” F I N A N C E .

IIM-Indore. Sara launched her own company.” remarked Sara. Australia. Of the ten teams selected to go to the next level of the Global Semi Final. After graduating from Haas. and seek expansion capital. Thailand. At the Semi Finals. the London Business School. The Wadhwani Centre for Entrepreneurship Development (WCED) at the ISB promoted the competition in all the Asian countries such as the Philippines. often. the Columbia Business School.e. and moves on to more “tangible businesses”? “No. Washinton). of the ISB. The projects were evaluated based on two important criteria: • Clear and quantifiable social objectives and impact • Financial sustainability. and Professor V Chandrasekar (ISB). and had obviously enjoyed the opportunity of judging the creativity of social ventures from young businessmen and businesswomen.” One criterion for entry in the competition is that each team have at least one actively participating MBA student. Did she think that the idealism embodied by “socially responsible businesses” get somewhat diluted as one graduates from being a student. Some of the participating teams the world over are already in business. The event had interesting sidelights to it such as a handicrafts exhibition and sale. The GSVC was started in 1999 as a student-led initiative by Sara Olsen.. four were from the ISB. SVT Consulting. “Personally. I have remained very much committed about ventures that make money for their investors. and the Goldman Sachs Foundation. who was a Haas student at that time. ten of these teams were selected to go through to the next round of the competition by a distinguished panel of judges. Hong Kong. Lakshmi Venkatesan (BYST). in the run-up to the event. The ISB had hosted the Asia Semi Finals of the GSVC in keeping with its responsibility as GSVC’s International Affiliate. and India. She had been a participant at the GSVC ever since its launch. De La Salle University – Manila. others exist only on paper. there is a mix of experience and idealism. of course not.I E N T E R P R E N E U R S H I P GSVC Social Ventures that Look Beyond the Bottom Line The Wadhwani Centre for Entrepreneurship Development (WCED) at the ISB recently hosted the first-ever Asia Semi Final of the prestigious Global Social Venture Competition (GSVC). and Mahidol University – Bangkok. Alice Lin (IFC. The competition aims to provide a global forum for entrepreneurs S to showcase their business plans. “So. Sixteen teams were shortlisted from among 66 Asian registrations after a preliminary evaluation by the judges. along with four others. a welcome function. i. one each from S P Jain. MDI. and for investors to support groundbreaking social ventures. and a cultural programme organised by the Spouses and Families Association (SFA). while providing tangible social benefits. The partners who now run GSVC are the Haas School of Business. all of which Sara had thoroughly enjoyed in the company of the other judges – Kim Alter (Virtue Ventures). China. Asian Institute of Management – Manila.” she said. being profitable and self-supporting through revenue generation 36 | ISB insight | March 2006 . ara Olsen was packing to leave after her extended weekend stay at the ISB in her capacity as a judge at the Global Social Venture Competition (GSVC). Professor K Ramachandran (ISB). to help companies evaluate and quantify their environmental and social impacts.

which focus solely on maximising financial return. Surprisingly. as a team from the ISB – Annie Mathew (ISB Class of 2006). We want these chosen leaders to understand that a social enterprise can benefit society. three came through the Asian Semi Finals held at the ISB. had a lot in common. services to MFIs.” Sara Olsen Professor V Chandrasekar. Charan Chintakandi (ISB Class of 2005). In fact. The WCED at the ISB carried forward its responsibility by providing mentoring support to the selected 10 teams to prepare them for the Global Semi Final. The WCED’s mentoring effort has earned rich rewards. and Mahidol University (Bangkok) – were all mentored by the specialist team at the WCED.e. i. and Ravi Kumar (non-student partner from Satyam) – has made it to the GSVC finals scheduled at Columbia Business School on April 6. while providing tangible social benefits.” The plans developed by the selected teams addressed rural electrification. and setting up a knowledge network to help farmers. of the nine finalists. The GSVC’s encouragement for ventures that address the financial. I have remained very much committed about ventures that make money for their investors. social.” she said. The problems may var y in severity. but the nature of the problems addressed remains ver y much the same all across the globe.. Initiatives such as the Net Impact – a network of MBA students and professionals committed to using the power of business to create a better world. these plans are assessed for a quantifiable social return on investment with the aim of getting the maximum social and environmental bang for the buck. by all means. A welcome trend. It is this innovative aspect of the competition that sets it apart from other B-plan competitions. “Non-profit” and “philanthropy” are terms that now seem almost passé. IIM (Indore). the use of ICT to empower rural Indians. measurable public benefits in financial terms. At the GSVC. What currently excites B-School academicians is finding innovative entrepreneurial solutions to social problems. a TV channel for differently abled persons. she found that the issues addressed by these varied B-plans that panned countries and even continents. and environmental bottom lines. and World Resources Institute (WRI)’s Beyond Grey Pinstripes – a guide to environmentally and socially progressive B-Schools are pointers towards this growing trend. is part of a growing trend of a few other similar initiatives that combine mission with strategy for the new breed of social entrepreneurs. and be professionally and personally rewarding as well. Executive Director WCED summed up the selection as: “We want to create a new generation of social entrepreneurs. empowerment of handicraft artisans. In her experience as a judge at the GSVC. “I find that the plans address much the same kind of opportunities and problems. The three teams to make it to the finals – ISB. Asia Semi Finalists at the GSVC March 2006 | ISB insight | 37 I E N T E R P R E N E U R S H I P . Sara saw a wide variety of Bplans developed by teams from various countries across the world.“Personally. 2006. electronic waste management.

or film – assumes blurred boundaries. The boundary problem is The Erosion of I F A C U L T Y Ravi Viswanathan. and all of this has interesting implications. So. the micro brewing industry rose as a reaction to the big industrial breweries. For instance. The micro brewery guys policed that. and Professor of Organisational Behaviour at Stanford Graduate School of Business. and how they combine – happens in markets and in organisations. or Indian companies emulating western ones? We can certainly see that. resulting in new styles from the blurring of boundaries. I choose research settings that everybody can easily identify with and relate to. is the research setting for Professor Hayagreeva (Huggy) Rao’s recent work. especially if the combination bike is offered at the same price point as the individual ones? Will you lose out on purists by straddling categories? You will. under what conditions is it better for firms to be able to offer products that straddle two categories? Is a bike. Infosys is thought of as an Indian company. though not just in western or eastern companies.I N T E R V I E W Categorical Boundaries Interview with Professor Hayagreeva Rao French gastronomy during the period 1970 – 1997. Let me give you a quick example. such as food. Bharanidharan and Pravin Gonabal from the Class of 2006 38 | ISB insight | March 2006 . But they are hiring a lot of people in the US markets. the definition of what’s a game. Praveen Gonabal. where animation and computer game-based techniques are combined to make films. You could also consider other areas such as machinima. talk to the Professor on the interesting implications of his research. They are going to erode under certain conditions. and introduced microbrew like products. The paper – Border Crossing: Bricolage and the Erosion of Categorical Boundaries in French Gastronomy. I showed how it happened in the French gastronomical market. which is actually a combination of a cruiser and a road bike. For example. that’s the film world’s equivalent of blogs. Bharanidharan. The students caught up with him at an Executive Education Programme at the ISB. Your research on French gastronomy deals with the erosion of categorical boundaries. and Ravi Viswanathan from the Class of 2006. A similar kind of blurring is happening in organisations. Professor Hayagreeva Rao is a member of the Faculty Advisory Board (FAB) on Organisational Behaviour at the ISB. and called the new products fake. So. is co-authored with Philippe Monin and Rodolphe Durand. and has been published in the American Sociological Review. in some instances. I like to study categories – in markets and in professions. when classical and nouvelle cuisines were rival categories competing for the allegiance of chefs. does that make it a North American company? I am not suggesting that boundaries are going to go away. Can we see examples of these in today’s organisational structures? In the global and multicultural contexts. The issue of categories – how they are created. better than a bike that exclusively belongs to only one of those categories. The industrial beer guys thought they should straddle. You see game developers using animation technologies for making films. animation. He has published widely on the subject of social and cultural causes of organisational change. can we see western companies emulating Japanese practices. and other equally interesting topics.

How are organisational structures around the world changing with increasing globalisation? We are already beginning to see the outlines of the future organisations. it is reflected in the growing number of Stanford students who want to come to India for internships. You are already seeing a lot of this. Stanford Graduate School of Business “I am not suggesting that boundaries are going to go away. particularly in the senior levels of the organisation. You can see the controversy on pensions – pretty soon this is going to become a hot political issue. one good reason being the inability to recoup training costs. and all of this has interesting implications. The rankings give you some information. and Professor of Organisatonal Behaviour. they compel schools to allocate resources towards a lot of cosmetic innovations. I would be mischievous enough to suggest that the problem you are alluding to. In general. and they constantly reassemble. Faculty Advisory Board (FAB). do firms engage in cosmetic innovations? The answer is somewhat complicated. Structures are going to change fast. Professor Hayagreeva Rao – Member. Does this affect the relationship between the organisation and the workforce? Definitely. People now freelance for organisations. is most visible in the area of B-School rankings. flat. For instance. Technology is enabling people to network very widely. and what sort of companies will outmanoeuvre the Indian companies. If you don’t develop long term relationships with your employees. people see themselves as a free agent in an economic system. so the opportunities are many. Prominence is a double-edged sword. And that’s part of a blurring – the beginning of a process. and that’s going to make organisations a lot more complicated. B-Schools could go to ridiculous lengths to earn points for their rankings. You reap the fruits of what you sow. you’re going to have lots of free agents. because they are not going to have innovation for the sake of innovation. they are not only under pressure to innovate. while the others are also establishing themselves. You can see it in companies like Sony and Apple – how they are all blurring boundaries between product categories. but not a whole lot. The challenge now is to go global. than in the operating core. The relationship between an organisation and its workers is changing fast. These are actually world class organisations. Attrition is a huge problem. regardless of whether the innovation is really needed. and to India? In many ways. Martin Kenny and Rafiq Dossani have written a book on Indian outsourcing entities. but the culture and the attitudes. The cell phone that combines camera and phone functions is an example. the impact is enormous. and gain a competitive advantage in driving others to emulate them? Visibility makes you a role model. Hospitals engage in “prestige competitions” wherein if one hospital bought a big machine that does CAT scan. I wonder if whether what is needed is more downsizing and right sizing. which is altogether different. they are going to be cellular. Indian companies – especially in software and biosciences – are being recognised as power houses. India and Indian businesses are getting a lot of positive attention in the global media. The interesting question is – what sort of companies will imitate Indian companies. the other also gets one. They are virtual. One of the things they say is that these entities are going to be out of business soon. Sometimes. but nevertheless. It’s really not the structure that you worry about. geographically dispersed.Is it possible that the hitherto trend-setting organisations around the world are under pressure to constantly innovate. They are noisy. The entire nature of the employee-employer contract has changed. just to maintain their status? Do you think that this could be causing wasteful or gratuitous innovations? What you are asking is. but you will also have your share of bad news. but also to be the best. Can Indian companies capitalise on this prominence. What opportunities does this prominence present to Indian companies. In the case of companies like Apple. and they move between organisations. ISB. They are going to erode under certain conditions. . But does the neighbourhood need both? It’s not clear that “prestige competition” is a good idea.” March 2006 | ISB insight | 39 I F A C U L T Y I N T E R V I E W fascinating in many other instances. you get the benefits. multicultural. at least in the United States. and have networks.

has also given me the confidence to face high pressure situations. So throw off your bowlines. had increased my desire to learn the business side of the industry. honing risk taking ability. with its world-class faculty. Class of 2003. Dream. which is necessary to balance work and life. you will be more disappointed by the things that you didn’t do. Learning time management skills has been another essential value learnt at the ISB. attracted me and lured me back to school. and the professors also respond to emails immediately in spite of their heavy schedules. solving problems with study groups or seeking clarifications from faculty members who untiringly spent as much time as possible with students. case studies and exams – all thoroughly captivated me. especially when there is a two-year old at home to take care of. Sail away from the safe harbor. and this has motivated me to apply for a Ph. Discover.D. and a chance of a lifetime to witness the crest and the trough of the IT business cycle from close quarters in 2000-2001. and discovering an increasing appetite to take on unconventional roles and activities. Competing with the crème-de-la-crème. The alumni network and deep friendships made at the ISB have always been a source of major support. identifying multiple solutions. I spent most of the days engaged in long hours of debate over cases. and is currently working with Cognizant Technology Systems. and graduating with top honors.I A L U M N I My Journey with the ISB Aarthi Ramesh. Six years of experience in the IT industry. the best learning for me has been looking at the overall perspective of an issue. “Ten years from now. developing and tapping networks. enthusiastic and helpful professors. and an international business programme at Indian costs.” – Mark Twain his was the quote that set me off from a technical job in the US to pursue my dream of becoming a business graduate from the Indian School of Business. than by the ones you did do. She was one of the toppers in her class. Explore. students with work experience and diverse profiles. providing frameworks to ambiguous situations. ISB. Any call for help is answered promptly. Chennai. she talks about the special bond that she shares with the ISB. In retrospect. Class of 2003 T 40 | ISB insight | March 2006 . The faculty encourages the students’ academic appetite. diverse study group. is a young achiever. lively class atmosphere. Catch the trade winds in your sails. Aarthi Ramesh. In the following article. ISB provided me with the right intellectual meat that I was craving for – the varied subjects. and the tenacity to persist and emerge victorious. programme in top US schools.

providing guidance to students applying to the ISB programme. For the entertainment. hookahs. and are times for reminiscing about ISB and meeting the new additions to the growing ISB family. and offering scholarships to needy students from the alumni corpus fund. would not have been possible without the help of the ISB professors. it is still the beginning. which had the crowd dancing to several foot-tapping numbers. which always attracts a good turnout. and several solo performances. Solstice the Annual Alumni Reunion The ISB community hosts its alums every year at a grand gettogether called Solstice. March 2006 | ISB insight | 41 . a rock band. and I personally believe that I stand to gain a lot from the institution. like Kanishka Sinha. The Class of 2006 toasted the alums with scintillating cultural programmes specially organised for the occasion. and a carnival that had game and food stalls. or when we get to hear any news about the ISB. A strong sense of belonging is what the ISB provides. The grand finale of Solstice was the energetic performance by Bhangra Knights. and there is warm bonhomie whenever we get to meet a student from the ISB. “I missed coming to Solstice last year. which had placement related advice being shared. and coming back this year has reinforced how much the ISB means to me. retaining contact with the ISB is of great importance. deciding on the lunch menu. For several alums. President. a quiz show. performances organised by the Net Impact Club. and sheikh attires. My journey with the ISB is not over. and also experiences of life after graduating from the ISB. who are themselves acknowledged as the best in their fields. Belonging to the second batch of the ISB has also given me the chance to build some of the traditions and practices. and hope to contribute whatever I can in making the institution a great place for learning and growth. There is so much pride in seeing achievements coming forth from the ISB family. and personally for me. helping in building the ISB brand among undergraduate institutions. The strong bond that the School shares with its alumni is on ample display at the reunion. In some ways. There is a great sense of pride and happiness in hearing that these little traditions are being followed even now by the current batch of students. Arjun Srinivasan. providing career guidance to the latter batches at the ISB. and reminded me not to neglect the things that are important. as part of the co-curricular activities – be it the starting of a new club. conducting interviews. Alumni Association. and championing the ISB brand in my current organisation. or even celebrating functions. there was a theme party “Arabian Nights” replete with mashaals. Besides the merriment. the event was an occasion to renew the strong bonds that the alumni share with the School.” he said. The alumni chapters in each of the regions also help a lot in meeting up with the alumni. Many of them work to give back something to the School from which they have gained valuable takeaways. it has been an endeavour to do whatever I can to help towards the growth of the institution – participating in road-shows. there were interactive sessions between the alumni and the current students. shared some of the future plans of the Association in investing corpus in equities. in his address. Class of 2003. For others. Solstice this year had much in store in the form of entertainment and learning experiences.The gathering at Solstice Getting through doctorate programmes in one of the world’s best universities.

I E V E N T S ISB Participates in Pravasi Bharatiya Divas 2006 The PBD is an event that attracts the Indian Diaspora from across the globe. South-East Asia. which shares a close bond with the NRI community. and arranged for a huge bonfire around which everyone danced to the rhythmic folk beats of a dhol. a school for the blind. CAF Annual Winter Conference The Centre for Analytical Finance (CAF) hosted scholars from the US. The campus hosted a group of 29 youth interns. . and dispelled some of the commonest assumptions about broadcasting. spoke on “Desperate Housewives Meets Arranged Marriages: Are Foreign Media Corrupting Indian Culture?” at a talk organised by The Global Institute Forum (TGIF) of the ISB. 42 | ISB insight | March 2006 Sunethra . The TGIF meets on the first Friday of every month to discuss topics of interest and relevance to our community. Associate Professor of Communication at the Boston College. She focused on the various problems and challenges pertaining to media globalisation. The ISB. He was in the city in connection with the Pravasi Bharatiya Divas (PBD). Montek Singh Ahluwalia’s Visit The Deputy Chairman of the Planning Commission visited the ISB recently. The Spouses and Families Association (SFA) pitched in with mouthwatering food. and took the time out to visit the ISB. and very heart-warming. The campus attracted several other dignitaries. and at the Bangkok Business Challenge. Apart from winning the trophy. and India. Nitin Vyakaranam won the first prize with “Spirit Networks”. at its annual Winter Research Conference. WCED Annual Business Plan Competition The Wadhwani Centre for Entrepreneurship Development (WCED) and the Entrepreneurship and Venture Capital Club (EVC) of the ISB conducted their Annual Business Plan Competition.ISB Happenings TGIF Talk on Global Media Expansion Elfriede Fursich. and our world. the winner represents the ISB at the Asia Moot Corp ’06. and discussed the conference proceedings. and appreciated the research activities undertaken by the ISB. The endearing entertainment display by these differently-abled children ended up being the scene-stealer at “Solstice”. The scholars presented their research papers. besides putting up a stall at the PBD venue. our country.Music Concert by Physically and Mentally Challenged Children As part of the alumni reunion celebrations “Solstice”. Lohri – The Festival of Joy Lohri was celebrated on campus with joy and exuberance. visually and mentally challenged children in an effort to raise awareness and funds to build school and hostel facilities for the children of Sunethra. including ministers and officials. who were also participating at the PBD. Europe. the Net Impact Club at the ISB held a special music concert by the hearing impaired. was proud to be a happy participant this year. The atmosphere was pleasantly rustic indeed.

With classical Greek names to events to connote an aura of adventure.” concluded Adarsh R of IIM-Calcutta. Elysium – a fashion show with the theme “The Five Elements of Nature”. The festival culminated in a grand finale – a Greek theme-based party that had some of the party-goers dressed in Greek period costumes to add to the ambience. Poseidon 2005 – the two-day multi-event student festival of the ISB. These events induced participants and audiences alike to test their mettle in fields such as Marketing. Negotiatus – a client interview contest. a participant. March 2006 | ISB insight | 43 . Entrepreneurship. conceived by Kabir Singh that they offered to incubate it. commercial and residential development and re-developmental projects in India in the next few years. Poseidon went down everyone’s memory as a memorable event. Consulting. “A very well organised event – one of the best among B-school festivals. Christmas Celebrations The ISB community celebrated Christmas with good cheer and merriment. challenge. Rhetorium – the ISB debate on a given topic regarding entrepreneurship. Some of the popular events were Olympieia – a technology innovation challenge that had competitors prepare short B-plans on technology related ideas. Information Technology. Kryptos – a test of the competitors’ advertisement interpretation skills. and many more. They sang carols. Incubation and Entrepreneurship (CIIE) was so impressed with another ISB entry “Comfort Controls”. The Center for Innovation. The festival attracted over 250 guest participants from the finest Bschools across India who competed for one-upmanship in events that ranged from the mandatory debates and quizzes to the more innovative events. Symposium – a live marketing case study contest. Drachma – an equity research report presentation. The children on campus pitched in with a specially orchestrated Nativity Play. Pegasus – a contest on presentations on Emerging Markets. And there were the “fun” events too that ensured all-round participation from enthusiastic young men and women “chilling out” before getting back to the rigour of academic study. Malini Alles: Venture Capitalist and Social Activist Malini Alles. Tempest – an evaluation of the competitor’s analysis of an entrepreneurship case.Poseidon 2005 ISB’s Multi-Event Student Festival Students Bag B-Plan Contests Chandrashekhar Vattikuti bagged the first prize with “Chitraksh” at Anveshan– BPLANZ. Neeraj Khemka was part of the winning team – “Altech” at the IIMKozhikode competition. is to invest in industrial. saw huge audience turnout with loud and wholehearted cheering for the participants. and Santa Claus ensured that they were all duly rewarded for their efforts. and Finance. succeeded in living up to its expectations. Idea 2006. Cerebrum – a test on the contestant’s problemsolving skills. “Maia”. the $100 million real estate fund. Eureqa – an online thematic quiz. In the end. the Silicon Valley venture capitalist and social activist. and shared her plans for her recently launched real estate fund. interacted with the ISBians. Energeia – a case study competition with the topic concerning the current energy scenario in India. and Octavia – a music competition. the annual business plan competition of IIM–Ahmedabad. and decorated the Christmas tree. and excitement.

The only certainty is that 86 percent markets are here to stay. Vijay Mahajan. They have low literacy rates. The authors present powerful solutions for unlocking these opportunities. former Dean of the Indian School of Business and current holder of the Harbin Centennial Chair in Business at the University of Texas in Austin. non-governmental organisations.amazon. Focusing on the 86 percent of the world with a per capital gross national product of less than $10. advertising. Yet with the right solutions. And it can serve as a rich guidebook for those who want to understand and grow their businesses in the 86 percent world. and Kamini Banga. and other organisations who want to better understand the complexities of the developing world’s business environment.com: “For years the developed world has been viewed as the “mother lode” for worldwide business. McKinsey and Company. Inc. Reviewer Craig L Howe has this to say about the book in www. sums up its message: “The transformation is just beginning. “This book demonstrates that the dramatic differences of emerging markets create tremendous opportunities. According to Rajat Gupta. These markets are young and growing. The 86 Percent Solution is a book that is likely to benefit leaders of governments. they argue. There will be hiccups along the way and further surprises over the next two decades as the next “Chinas” and “Indias” emerge. According to the authors. consultant. and Chairman of the Board of the Indian School of Business.” 44 | ISB insight | March 2006 . these countries lack infrastructure and media. The growth. These markets have been largely invisible to worldwide companies and even some firms operating there.” The authors draw on several case studies from emerging markets to demonstrate actionable strategies and tactics for product design. these markets represent staggering opportunities. the authors acknowledge. they are the future. pricing. over-competitive and aging. branding. Yes. packaging. lies in reaching the rest of the world. distribution. Copyright © 2006 Pearson Education.” The book has been widely reviewed for its ability to appeal to managers trying to expand market reach in developing countries who want to think differently about strategies that may succeed in their own environment. The 86 Percent Solution is a wake-up call for any company. and much more. The book’s concluding paragraph. And the companies that can develop the right solutions to meet their needs will find a rich source of growth. or educational institution that has not given these markets sufficient attention in the past. these markets are oversaturated.Book Review The 86 Percent Solution: How to Succeed in the Biggest Market Opportunity of the 21st Century by Vijay Mahajan and Kamini Banga Publishers: Wharton School Publishing. an independent marketing consultant. Even though they won’t become developed tomorrow. Their consumers react in unconventional ways. Senior Partner worldwide.000 year offers a rich opportunity. Companies poured their resources into serving the 14 per cent of the world’s population that is fortunate enough to live there.

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