More for Less for More

Earlier this year I was at a conference and was lucky enough to hear Dr. R.A. Mashelkar  present an inspiring address on Gandhian Engineering.  A concept that incorporates the principles of doing more (providing more features, more services, more  value) for less cost to make it more accessible and available to much larger numbers of people.  Hence the phrase “More for Less for More”.

Tata Nano Car WhiteAn example of this was the launch earlier this year of Tata’s radically innovative car, the Nano.

Speaking at the unveiling ceremony at the 9th Auto Expo in New Delhi, Mr. Ratan N. Tata, Chairman of the Tata Group and Tata Motors said, “I observed families riding on two-wheelers – the father driving the scooter, his young kid standing in front of him, his wife seated behind him holding a little baby. It led me to wonder whether one could conceive of a safe, affordable, all-weather form of transport for such a family”.  He challenged his organization to think differently about the problem and they did.  Only a few years later they delivered the Tata Nano, a “comfortable, safe, all-weather car, high on fuel efficiency & low on emissions” for approx US$2000.

Tata received more than 200,000 orders in the 3 week period following its launch in March. Today they can produce approx 3,000 cars per month.  A small number considering the demand . 

However with increased production capacity being addressed, we will see over time improvements in quality and consistency, and the addition of features likely to be provided at an even lower price.  And of course the competition will follow benefiting greater numbers of people.

Already there are announcements by a number of car manufacturers that they too will be entering this low end/low emission category including the bigger, more well-known names.   The Japanese car industry turned the car industry on its head once before.  They lead with price and followed with quality.  The same is happening with Korean cars now and we will soon see the same with Chinese and Indian automobile brands to follow.  Large-scale change can and will occur and accessible and affordable cars will be available to those who require a safe form of transportation, and who were previously locked out, in the near future.

The challenge is certainly there for businesses to think about how best to serve and care for the 6.8 billion people we have on this earth.  There are two aspects which drives the need for businesses to broaden their current thinking:

  1. The ubiquitous nature of the internet & wireless technologies – the increasing speed of technology for increasingly commoditized (and thus reduced) pricing is making it easy for people all around the world, including within developing nations,  to connect and transact with anyone, anywhere, anytime.  The flattening of the world opens up additional markets – more product choices for people, more potential customers for business. The greater the global demand, the more solutions will exist in logistically moving or upgrading goods and services around the world.
  2. The expanding social and environmental conscience – the ever-increasing pressure to evaluate our footprint on the world and the increasing gap awareness in wealth between nations.  This will continue to grow as the consequences of our current policies and actions continue to become better understood, and the forums for voting with your feet become more common.

With increased competition as the world continues to flatten, businesses will require greater creativity and innovation from their people.  Without a model for constant and differentiated innovation, businesses will suffer and ultimately become irrelevant.  Increased competition from the developing nations will continue to place pressure on value for money. 

And as price drops due to competitive and consumer pressures, so will margins.  Thus there will be a requirement (not just an opportunity) to sell to more people together with an increased requirement to build meaningful, personal relationships with customers.  This will drive the way organizations will think about their product or service offerings in the future.

A decision will need to be made by businesses. 

Do they cater for a few customers and charge a premium or do they rethink their business model and approach with the objective to do “more for less for more”?  Both models will require continuous innovation and competition will require them to define how they are going to keep doing it better than anyone else.

I applaud the technology, medical, science and engineering organizations who are already thinking this way.  Interestingly this approach increases profits for most of those organizations. But real revolution starts with awareness by a bunch of like-minded people that things need to change for the better.  Revolutionaries’ prophesize through education, communication and real example, encouraging more and more of the general population to follow and take action.

It poses an interesting question to every one of us:  What responsibility can we take in our every day decisions to stamp out oppression, poverty, hunger, poor health, and environmental damage?

 In every decision we make – either business or personal – how can we make an impact on providing equal opportunities for people to thrive no matter where they are located?  Can we offer more for less for more people?

The questions may seem big, the actions we make may seem little, but every one of them will make a positive difference.

Can you afford the expense of a cheap lawyer ?

drive-thru-lawyer-brookenovak Ever heard the saying “there is nothing more expensive than a cheap lawyer”?  That lesson can easily be applied to the decisions we make every day regarding our business vendors.

It is easy to make the mistake of spreading our budget too thin or going with the cheapest option – mistakenly thinking we are getting more bang for buck or that we are saving money.   Often you will find this approach will result in poorer quality and not achieving the goal you set out to do in the first place.  The cost either in additional time or further investment to bring what you are doing back to scratch can often be far greater than if you had aligned your budget to your goals in the first place (or your goals to your budget).
Although this rule applies as much to the personal decisions we make, it is less likely we fall into that trap because we tend to naturally protect “our hard earned money”.  We will spend far more time in determining return on investment whether it is through measuring easy to compare metrics, searching online or by talking to family and friends to better understand their experiences and opinions.  We seek recommendations feeling confident of asking someone we know “how did you find your builder, car, computer, TV, phone etc? “.  We do this whether it is a conscious best practice or not. 
It has always struck me the difference that people feel about spending their own money vs. their employers’ money.  The sense of responsibility and ownership for return on investment regarding business purchases often differs from the way the same decision would be approached if it was their own money. At a time where organizations are looking at innovation as a means to survive the global economic environment, we should also be revising our planning and procurement approach.  And this is more about the culture you create rather than defining it through process.
Encouraging your team to spend time on determining the best plan to achieve your goals against budget, investing in research and assessment of the right vendor, obtaining testimonials directly from similar type businesses who have engaged or purchased from that vendor, investing in developing a good brief or requirement specifications; all will help you determine the best partner for you and your company – and I do emphasize that you see the relationship as a partner not just vendor/supplier.   This should result in you choosing the best partner that truly shares your vision and belief in your desired objectives, and is motivated to bring you success beyond “making the sale”.

If you are delivering on someone else’s brief, and you find the scope and budget are out of alignment, you may need to either negotiate more budget or learn to reset expectations when determining how best to achieve the goal within the budget you have.
Whatever you do, don’t make the mistake of going with the cheapest option, spread your budget too thin, and have the outcome you are working to achieve at risk.  Even with the financial pressures as they are today, you can’t afford the ‘real’ expense of going with the cheapest lawyer or any other vendor unless you really have weighed up the true cost and return of that engagement.
The same goes in reverse.  If you are offering a product or service, make sure you invest in understanding the brief and proving how you are best able to help your client achieve their brief.  Be realistic about pricing and quote what you believe is fair and reasonable for the scope of brief or requirement given. Everyone needs to win for success to be fully realized. 
You need to buy well to return well. And this may mean you need to review your purchasing culture right now.