A little knowledge is a dangerous thing

on a recent visit to BIRLA-NOIDA I was wearing an offwhite linen jacket with a pale blue shirt and a tie in a solid color with charcoal trousers. A student said, “Sir, I think your jacket is not matching your shirt. You should be wearing a dark shirt with your light jacket.”

This is not a post on dress sense, rather this is a post on why it is important to not rush to judgment. Every statement of fact, or almost every statement of fact, is an approximation. We see this in physics, where even Newton’s laws of motion are approximations. We see this in all generalizations about race, and social systems, and corporate strategies, and moral systems, and of course the highly subjective and evolved worlds of literature and abstract art … and sartorial fashion.
We learn that we must never begin a sentence with an “And” but the best writers sometimes do with great effect. We learn detailed rules about how a PowerPoint presentation should look like and then someone makes a great presentation while flouting all these rules and putting, say, just four words on a single slide. There are always more advanced approaches.
And wearing light colored shirts with light colored linen jackets may be a good idea if you want a muted sophisticated look. A dark tie adds a more measured dose of color than a dark shirt would.

The top 18 things that a businessman should know

I'm returning to this blog after a long period of inactivity. Inactivity on the blog, that is - in real life the degree of activity around me has soared like Delhi's blazing heat in this, the hottest early summer in decades.

Manu, Varun and I have been designing the Family-Managed Business program that we are going to launch shortly. We have been thinking that in this program we will focus on a different aspect of family-managed entrepreneurial business each month. Thus the 18 month course will allow us to dive into 18 different things, which should together provide a practical and comprehensive 360 degree view.

To decide what these top 18 things should be, we first drew up independent lists. When I compared my list with Prof. Varun's this morning, I was not surprised to see that there was a 90% overlap. (I haven't compared it with Manu's yet.)

This then is my informal list, in no particular order, focused solely on practical topics for the small-scale or medium-scale business:

Defining your narrower market niche (in which you are THE best)

Developing a vision for your business (this is closely tied to the first point)

Leveraging the power of Internet marketing (using websites, SEO, SEM, social networking, blogs, etc.)

Getting the most from real world marketing (ranging from smarter business communication to cultivating newsmedia for PR)

Conceptualizing, planning and executing initiatives (project management)

Scaling an organization through modularization and processes

Understanding accounting and tax optimization

Understanding people and what they are good at, developing reporting systems

Leveraging business IT

Understanding business law, contracts and litigation

Managing your time and your mind

Understanding quality

Maximizing profit and cash flow, not just sales

Balancing family relations and the business

Professionalizing the family business without affecting the bottomline

Learning the art of selling and negotiation

Managing business risk

Handling the regulatory environment

Most of this I learned by trial and error and had we been taught this through our formal education, we would have done better and gone further.

Anything I left out?

How to end a recession

Of late, there has been considerable debate - especially in the US and Europe - about government deficit spending to hit one's way out of a recession. A little like a side batting second in a one-day cricket match with few wickets left may choose to throw caution to the winds and go after the bowling, somewhat counter-intuitively.

Some left-leaning economists like Paul Krugman strongly advocate such spending, pointing out that Japan's tightening its purse-strings probably deepened that country's problems.

In fierce opposition, right-leaning economists point out that Germany has remained fiscally responsible and is doing well, while countries like Greece have had free-spending governments and have been the worst hit.

While reading yet one more article on this by Krugman in the NY Times, a thought dawned on me and I posted a comment (which I hope Krugman read!)

It seems to me that recovery from a major slump is ideally built around a theme of some sort, that businesses and individuals can rally around. Perhaps the theme may or may not involve major deficit spending.

A world war, a historic decision by businesses and trade unions to be flexible*, an appeal to the national character, an astrological prediction of a bountiful year, even a world championship win in a popular sport - in different contexts and cultures these could all be themes that pull an economy out of recession.

*as in Germany

You can see this in India. A lot of the richer people believe India is shining, so it is not doing badly overall. Currently growth seems to be a seriously lagging indicator of the stockmarket indices, rather than the other way around.

In the US, people and businesses are currently pessimistic, so the situation is worse than it might have been. There are fundamental problems - primarily too little genuine education and too much soundbite TV - but these are not insurmountable.

Perhaps the US should have been allowed to win the soccer World Cup?