Thursday, November 20, 2014

Half a step

One of the most important pieces of advice that I ever received was from a former boss, who was not just an extra-ordinary problem solver but also a master at business strategy.

His advice was very simple: “The difference between being half a step ahead and half a step behind is only a step, but it is the most important step.”

Coming from most people it would have seemed like yet another business cliché, but having observed his overall success first hand, this advice stuck with me from that moment onwards and has since been a big part of how I think and work.

The advice is simple and intuitive, but practising it takes, well.., some practice.

The underlying assumption of this advice is that most people do the bare minimum for known events and usually just react to new situations that may crop up. It’s never a good thing to make sweeping generalizations such as this one — but in this case, I have found that the assumption generally holds good although its magnitude may differ based on the culture of an organization or society.

There are two key parts in making the advice work. Accountability and Anticipation. Both work in tandem and are necessary conditions.

Accountability is committing yourself to something and then having the discipline of doing it to the standards that you committed yourself to. This means a no-excuse ownership of delivery and quality.
Anticipation is a little more difficult to practice because it needs reference points and judgment. But in simple terms, all it means is to take a step back and look at your delivery objectively to answer a simple question — what could screw this up? We are not looking for black swans, just a simple testing of our core beliefs in producing that output. Just being aware of the risk gives enough ideas to keep you half a step ahead.

With the above two components of the plan, the simple advice has enough power to make a meaningful difference. It works for something as simple as leading a work project or as complex as changing some personal life situation. At the very least, it helps you in being prepared — and that in itself is a great outcome.

It is no coincidence that the most effective people I have met seem to have already ingrained this approach, and are quite possibly more than half a step ahead. Go ahead and give it a try — start with something as simple as your next big meeting coming up at work.

Tuesday, March 4, 2014

BS is easy to call

The best insights come from the street, literally. My long, daily commute provides me with enough rich experiences that help me step away from the tech bubble, and these little diversions are necessary to stay grounded.

Meeting 'John Doe' today was such an experience. John, a regular guy that I meet sometimes on my commute, does a particular shift everyday because it suits his work style better, not because his manager 'positioned' it as a promotion. "If there's no raise, it ain't a promotion, and I am not buying that BS" was how he articulated. Although there are several cases where a 'cashless' promotion is a genuine situation (eg. developing talent, actual $$ scarcity at the company etc.), a dishonest attempt by management is pretty easy to spot for most employees.

This particular exchange with John got me thinking about the cases where BS management decisions are nothing more than self-deception and forced manufacture of consent.

It takes a worse form in managers with a propensity for empire-building. Since titles cost no money, this manifests itself in specious designations like "Head of ..." and "Strategic lead, ..." in organizations gravitating towards bloat and mediocrity. Just like John Doe, most of the title recipients are aware of this short-change and will take it to either preserve mortgage status-quo, boost their LinkedIn profile for recruiters, or to find a fit with something that clicks naturally in their lives. This obviously does not do any good for the manager or the organization. Poetic Justice.

Some other examples of highly 'disingenuous' management acts:
- Fishing over-qualified candidates with job descriptions that convey highly inflated responsibilities. Smart candidates either figure it out during interviews or bail out soon.
- Bringing in consultants to help out with strategic decisions (with sincere apologies to my many management consultant friends:) - Most employees view the expensive consultant, giving the fancy report with custom graphics, as the messenger for the pre-made decision of the management.
- Org changes to 'better re-align' to customers/market conditions. Almost always viewed suspiciously by employees. Without a sound strategy in place, these re-alignments disrupt the org every 9-12 months without much change.

Management is a much-maligned word historically, which means that managers need to earn their spot on the team - knowledge and talent are necessary, but not sufficient. If your team does not trust you to watch their backs, you stand guilty of reinforcing the management stereotype and making it harder for other managers.

Thursday, January 30, 2014

Real Options and the strategic brilliance of Larry Page

(Disclaimer: Although I have worked for Google in the past, I had no access to inside information about the Google-Motorola deal and the strategies. My writing is based purely on publicly available information and my own thoughts on this situation)

Tech pundits are scratching their heads again. Most reactions about Google selling off Motorola to Lenovo range between a massive failure for Google (Mashable) to the typical Schadenfreude (John Gruber). Two blogs that got it right (right = my theory) are Dealbook and Gigaom.

To understand the Google-Motorola deal in the first place, it is important to keep in mind the context of the 2011 smartphone market. On one hand, there was Apple, very willing to go to court with their patent arsenal to crush Android's advances. On the other, there was Samsung - a close ally that was getting powerful within the Android ecosystem and taking away most of the profits. Samsung was already the key supplier to Apple for all their hardware needs, and the Android partnership provided them with a great hedge and huge profits to boot. Competition within the Android ecosystem - despite Google partnering with HTC, LG, Asus etc just did not play out as well, and these companies were unable to counter the marketing might and vertical integration capabilities of Samsung.

People in corporate finance are familiar with the concept of Real Options, and I believe this is what the Google-Motorola deal looked like. (Wikipedia : A real option itself, is the right — but not the obligation — to undertake certain business initiatives, such as deferring, abandoning, expanding, staging, or contracting a capital investment project). I believe that real options are also great strategic decision tools in uncertain market conditions; and in this case they were the perfect instrument.

Motorola was a real option for a considerable cost, which was a great way to get a trove of patents to keep away Apple and others. It was also a great tool to check Samsung's progress with the implicit signaling of superior hardware capability within the company that owned Android, Samsung's profit source.

The steep price tag of $12B for the deal was significant, but it was needed for the greater prize of the smartphone marketshare. In fact, as the Dealbook math shows, it was not a huge price for this play. The value of the patents might be debatable, but it definitely slowed down the patent trolling and shored up the defenses pretty well for Android. In the last two years, it has been pretty well demonstrated that the mobile business is going the PC way - commoditization, and the value really is in owning the platform and the end-users.

Looking at Apple's most recent quarter and market trends, it is quite clear that as smartphones become the only type of phones pretty soon, Android will own at least 2/3rds of the market in the stable equilibrium, while Apple will have the rest. That will be a great outcome for Google - it will have replicated its desktop dominance on mobile too. This war is almost won - which leaves Motorola, the hardware factory, as the option that will not be used. Google is an advertising and a web services company, and it is well aware of that core competence. As for Motorola+Lenovo - it will make for a great competitor to Samsung and the couple other Chinese firms that are beginning to create the perfect set of companies to keep the Android flag flying.