Friday, June 19, 2015

Scale and Impact: Lessons from Ronnie Screwvala's Entrepreneurial Journey

Ronnie Screwvala’s entrepreneurial journey has traversed many paths. Starting from what seems very mundane by his standards – manufacturing toothbrushes – Ronnie has been into cable television and tele-shopping and, most successfully, into the media and film production.

From being a major provider of content to other channels with pioneering shows like India’s first daily soap opera Shanti, Ronnie’s UTV evolved into a media player in its own right through successful channels like Hungama and Bindass. While I knew that UTV had made many memorable films, it’s only after reading Ronnie’s entrepreneurial autobiography Dream with your Eyes Open (Rupa, 2015) that I realized the extent of their range, and how successful they had been.

Ronnie has been on a break between ventures (it’s impossible to contemplate him sitting still!) and he has put this time to good use by sharing with all of us some of the key insights from his life as an entrepreneur in India!

Just Another Entrepreneurship book….or something more?
There are, of course, many books written by entrepreneurs about what it takes to succeed as one. So, it’s natural to ask is there anything special about Ronnie’s book? Are there any unique insights that he has to share with us?

What I liked best about this book is that its told first-person, direct, and with very little digression. As a result, it’s short, pithy and eminently readable, and packs a lot into its 160+ page core. It is motivating (just look at the range of things Ronnie has done starting with not too much money in his pocket), yet realistic in that it does not gloss over failures or pretend that everything happened according to plan.

The main message I got from this book is what I would call the importance of determined execution. Once you have identified an opportunity, made reasonable checks to verify that the opportunity is for real, and decided to address the opportunity, put everything into it to make it happen. That’s a characteristic Ronnie displayed from his first venture into making toothbrushes with second-hand, automated machines imported from Europe, through his creation of the infrastructure to produce a daily soap opera, and into his becoming one of the biggest film producers in India with several films simultaneously under production.

An integral part of this “determined execution” is Ronnie’s belief that it’s better not to have a “Plan B.” His rationale is that the very existence of a Plan B acts as a temptation to give up as soon as one hits (inevitable) obstacles. Instead, one has to be determined to make Plan A work.

So, how does one make Plan A work? What I understood from Ronnie’s book is that this happens essentially by planning, frugal innovation, having the right team and clear communication. The right partnerships also help.

What do you need to be a successful entrepreneur?

One of the points in Ronnie’s book that resonated very strongly with me is to never start or run an enterprise with exit as the objective. Instead, focus on building the enterprise’s brand, franchise and growth potential. This is not a commandment against exits – it can’t be, for Ronnie has exited several businesses over his career – but simply a caution that running an enterprise with exit in mind is very likely to make you take wrong decisions that could jeopardise the future of the company. Exits make sense when the future of the company would be better assured in someone else’s hands. For example, Ronnie justifies his sell-out of his TV channels to Disney by the fact that he and Disney had a very similar approach and philosophy to youth channels, and the future of the channels would be safe with a well-endowed player like Disney.

One important point that Ronnie has underlined is the need to focus on spotting emerging trends and maintaining continuous contact with present and prospective customers. The former is important both to identify emerging opportunities as well as get out of the way of trucks and trains that could knock down your business. This resonated well with the pain-wave-waste framework we proposed in 8 Steps to Innovation – a company’s challenge book emerges from feeling the pain (of customers, users), sensing the wave and seeing the waste (of human effort, material and energy).

An important element of Ronnie’s managerial style that emerges from this book is getting into detail, continuous motivation of the team, and frequent communication. He is unequivocal about his dislike of long Powerpoint presentations that don’t come to the point and provide an opportunity for everyone to mentally disengage and start playing with their phones instead. This made me wonder how Ronnie deals with Newgen employees who are hooked to multi-tasking with one eye always on their smartphone!

Ronnie dwells quite a bit on failure and the importance of looking failure in the face, learning one’s lessons, and moving on. Clearly, in Ronnie’s case, this ability came from a strong sense of self-belief and self-confidence. How do you build that confidence? Well, in Ronnie’s case it appears to have come from his involvement with the theatre. The ability to appear before an audience, emote your lines as planned, and hold the audience’s attention was, I am sure, helpful in building this confidence. Though he doesn’t dwell too much on his family, I get a sense that his family gave him that confidence too – while I am sure his family wasn’t pleased by his failing in his college exams, they gave him the space and encouragement to start again.

Like many entrepreneurs, Ronnie alludes to what is commonly called the affordable loss approach to risk management. He is willing to take big bets as long as he will be able to survive the downside. This simple heuristic is invaluable to entrepreneurs, particularly in India where so many things seem outside one’s control.

I found one of Ronnie’s observations particularly insightful. We often find businesspeople complaining about regulation and how it impedes business. But, based on his experience in the then fledgling cable TV business, Ronnie argues that some regulation is important to ensure that ground rules are in place and that there is orderly development of the industry. Here I might add that it’s not only regulation that is needed, but its fair and transparent  enforcement. In the absence of such enforcement, players who follow the rules are at a disadvantage and this often leads to poor quality products and services.

A Couple of Cribs…

For Ronnie, clearly big is beautiful. Though he acknowledges that scale is an individual choice and that some may choose to start niche businesses, his own preference for the large and impactful is clear. Ronnie argues that strategy becomes important only when you pursue scale. I found that too much of a stretch – in today’s highly competitive world, even a small company in a narrow niche needs to keep sharpening its competitive advantage if it wants to survive. Yes, for sure, the strategic challenges become greater when you are investing thousands of crores in setting up a Reliance Jio, but even a boutique consulting firm needs a strategy to survive and prosper!

One of the big challenges of starting and running a business in India is coping with corruption. Prospective entrepreneurs, particularly those who lack a business background, are often unsure how to deal with this. Ronnie makes only a passing mention of ethics and integrity. I wish he had shared his perspective on this issue.

In conclusion…

There is a surge of entrepreneurial energy in the country today. For the would-be entrepreneur looking for the right motivation and some tips on how to keep going, Ronnie Screwvala’s book has come out at the right time.

[The views expressed here are the personal views of the author.]

Saturday, June 6, 2015

Are you too old to be an entrepreneur?

Age shouldn't be a barrier to your entrepreneurial dreams. Read more here.

What we can Learn from the House of Tata about Innovation

The Tata Group Innovation Forum and associated activities have been in place for about a decade now. Here is what we can learn from them....