The grey market or the “dabba” market, as it is popularly called is fascinating. As a company announces its IPO (book-building) dates, players in the grey market try to put a price on the shares of the company. They try to speculate market response, size of the issue and fix a premium on the shares.
This market is interesting for many reasons. It’s illegal – plain and simple. However, speculators and investors have been doing it for a long time. The grey market premiums themselves are quoted in almost every financial daily and broking firms, worth their salt. Many times these markets also decide the fate of listing gains.
There are many other interesting facets to this market... How do these dabba operators ensure actual delivery right under the nose of the regulator? Many time unscrupulous promoters use this market to fool gullible investors.. And sometimes this market is also used to infuse liquidity into the secondary market...
If you come across any article or news which is related to this, please let me know... i am undertaking some academic stuff on this...
Monday, July 30, 2007
Sunday, July 29, 2007
The black swan strategy
I recently read a few articles on this subject and found it extremely interesting..
Nassim Nicholas Taleb has built his career based on the theory of unexpected rare events. Taleb calls himself a "skeptical empiricist", and believes that people generally overestimate the value of rational explanations of past data, and underestimate the prevalence of unexplainable randomness in that data. Simply put, he says that "No amount of observations of white swans can allow the inference that all swans are white, but the observation of a single black swan is sufficient to refute that conclusion."
His company Empirica follows a particular investment strategy - It trades options, i.e it deals not in stocks and bonds but with bets on stocks and bonds. It takes very small bets from people on an unlikely event. For example, if a stock has lets say never dropped below 10% in a particular month, it takes a bet from you for a very small amount (lets say 1 cent) that the stock will indeed drop by 10% or more in this month. You don't mind this bet, because this event has never happened in the past. However, the company buys millions of such options from various people. If as expected the event doesn't happen then the company loses. But remember, its loses are pre-determined and small. However, if indeed the event does happen, the company rakes in millions of dollars.
Empirica makes its money when there is an exceptional day in the market. Something new or different happens and the unexpected unfolds. Under such circumstances, which were probably all but impossible to predict, Empirica will be able to exercise its options and reap a healthy profit. Huge gains will make up for the numerous days of small loses.
Venture Capitalists use this at all times. They invest in tons of “white swans,” lose a little bit all the time on those investments, and be poised for the singular “black swan” whose returns swamp all of those losses.
Nassim Nicholas Taleb has built his career based on the theory of unexpected rare events. Taleb calls himself a "skeptical empiricist", and believes that people generally overestimate the value of rational explanations of past data, and underestimate the prevalence of unexplainable randomness in that data. Simply put, he says that "No amount of observations of white swans can allow the inference that all swans are white, but the observation of a single black swan is sufficient to refute that conclusion."
His company Empirica follows a particular investment strategy - It trades options, i.e it deals not in stocks and bonds but with bets on stocks and bonds. It takes very small bets from people on an unlikely event. For example, if a stock has lets say never dropped below 10% in a particular month, it takes a bet from you for a very small amount (lets say 1 cent) that the stock will indeed drop by 10% or more in this month. You don't mind this bet, because this event has never happened in the past. However, the company buys millions of such options from various people. If as expected the event doesn't happen then the company loses. But remember, its loses are pre-determined and small. However, if indeed the event does happen, the company rakes in millions of dollars.
Empirica makes its money when there is an exceptional day in the market. Something new or different happens and the unexpected unfolds. Under such circumstances, which were probably all but impossible to predict, Empirica will be able to exercise its options and reap a healthy profit. Huge gains will make up for the numerous days of small loses.
Venture Capitalists use this at all times. They invest in tons of “white swans,” lose a little bit all the time on those investments, and be poised for the singular “black swan” whose returns swamp all of those losses.
Friday, July 27, 2007
In search of mediocrity
In a world where perfection is expected and excellence is tolerated, this search for mediocrity may seem quite counter intuitive..
One of our professors made us think on the merit of this advice. Many many individuals and companies are making millions by following this strategy of chasing medocrity and not excellence. How could this be done...
The new mantra for very many PE firms now is Invest-Turnaround-Harvest. They don't look for excellent companies for investing, instead they look out for poorly managed companies and use basic management principles and common sense to turnaround these companies to average performing companies and sell them at a much higher valuation.
Take the case of some individuals. A new breed of high performing operating executives are being hired as turnaround experts. These guys are not liquidation managers, they instead repair and build back poorly managed companies. Michael Capellas, who has made serial job hopping a career, is a case in point.
As head of Compaq Computer, Capellas led a turnaround and a sale to Hewlett-Packard before leaving the company in 2002. Capellas then took over MCI while the company was in bankruptcy and eventually sold it to Verizon. He has collected large paychecks along with way and is estimated to have taken home a total of more than $57 million in change-in-control payouts from Compaq, Hewlett-Packard and MCI. He was an adviser for Silver Lake Partners, a buyout firm that specializes in technology and from there on he moved as head of Serena Software, one of Silver Lake's portfolio companies. Now, Capellas is taking over as chief of First Data Corp., the payment-processing giant acquired by the private equity firm KKR in April for $25.6 billion. This will be his fourth technology company in eight years. With an ownership stake in First Data, he could take home millions more.
Convinced? If not, let time heal you..
One of our professors made us think on the merit of this advice. Many many individuals and companies are making millions by following this strategy of chasing medocrity and not excellence. How could this be done...
The new mantra for very many PE firms now is Invest-Turnaround-Harvest. They don't look for excellent companies for investing, instead they look out for poorly managed companies and use basic management principles and common sense to turnaround these companies to average performing companies and sell them at a much higher valuation.
Take the case of some individuals. A new breed of high performing operating executives are being hired as turnaround experts. These guys are not liquidation managers, they instead repair and build back poorly managed companies. Michael Capellas, who has made serial job hopping a career, is a case in point.
As head of Compaq Computer, Capellas led a turnaround and a sale to Hewlett-Packard before leaving the company in 2002. Capellas then took over MCI while the company was in bankruptcy and eventually sold it to Verizon. He has collected large paychecks along with way and is estimated to have taken home a total of more than $57 million in change-in-control payouts from Compaq, Hewlett-Packard and MCI. He was an adviser for Silver Lake Partners, a buyout firm that specializes in technology and from there on he moved as head of Serena Software, one of Silver Lake's portfolio companies. Now, Capellas is taking over as chief of First Data Corp., the payment-processing giant acquired by the private equity firm KKR in April for $25.6 billion. This will be his fourth technology company in eight years. With an ownership stake in First Data, he could take home millions more.
Convinced? If not, let time heal you..
Tuesday, July 24, 2007
Pumpkins and mice
With the bulls raging at Dalal Street and Sensex within a kissing distance from the giddy height of 16000, i want to reproduce one of the classic gems from Warren Buffet...
Buffet says that "The line separating investment and speculation, which is never bright and clear, becomes blurred still further when most market participants have recently enjoyed triumphs. Nothing sedates rationality like large doses of effortless money."
After a heady experience of that kind, normally sensible people drift into behavior akin to that of Cinderella at the ball. These sensible investors know the cost of overstaying the festivities -- that is, continuing to speculate in companies that have gigantic valuations relative to the cash they are likely to generate in the future -- will eventually bring on pumpkins and mice.
But they nevertheless hate to miss a single minute of what is one helluva party. Therefore, the giddy participants all plan to leave just seconds before midnight. There's a problem, though: They are dancing in a room in which the clocks have no hands...
Buffet says that "The line separating investment and speculation, which is never bright and clear, becomes blurred still further when most market participants have recently enjoyed triumphs. Nothing sedates rationality like large doses of effortless money."
After a heady experience of that kind, normally sensible people drift into behavior akin to that of Cinderella at the ball. These sensible investors know the cost of overstaying the festivities -- that is, continuing to speculate in companies that have gigantic valuations relative to the cash they are likely to generate in the future -- will eventually bring on pumpkins and mice.
But they nevertheless hate to miss a single minute of what is one helluva party. Therefore, the giddy participants all plan to leave just seconds before midnight. There's a problem, though: They are dancing in a room in which the clocks have no hands...
Sunday, July 22, 2007
India Shining
I took this picture on my journey to Chennai during the term break. This was inside an Air Deccan flight...
....and I think this picture pretty much summarizes the India shining growth story...
Friday, July 20, 2007
The Wealth Maxi"MISERS", The woodcutters and the wise men
When you meet people and say that u r doing a PGP programme from ISB, you typically evoke some response from them. I am in Chennai on my term break and met many of friends and past colleagues. And I have tried to frame their responses under three categories - The Wealth Maxi"MISERS", The woodcutters and the wise men
The wealth maxi"misers"
This group's first question is how much does it cost to an MBA from ISB? When i tell them that its about Rs. 14 lakhs (Food and acco extra). They are then dumbfounded and ask me the same question again just to recheck if they heard me right. They then respond back saying that, It is so costly, it does'nt make to sense to spend that much money to study.
What is costly? Is a reliance stock priced at around Rs. 1900 about 400 times more costlier than Pentamedia Graphics stock which is priced at about Rs. 5? The mathematical answer to this question is a simple YES. But that's not an answer you expect from good investment analyst. Comparing two things purely based on their absolute prices is not just useless but quite dangerous. If ISB does make sense in your career and if you take ISB as an investment and undertake an effort to calculate the NPV by a discounted cash flow method and compare it with the NPV of your career without it, am sure your investment will more than be justified.
But i know that these people cannot be convinced as they generally don't hear what they don't like to hear. So, when i meet up with these people i just smile :-)
The woodcutters:
This group's reaction is "Why did u leave the job to go and study?" Leaving a job at this stage is foolish. When i meet up with them i am reminded of the woodcutter's story. Some woodcutters never waste anytime and keep cutting trees without checking if their axe is sharp enough. Sharpening the axe tantamount to wasting time and these woodcutters hence doesn't indulge in this activity.
My reaction when i meet up with these people is "I am sharpening my axe". I don't claim that ISB is the only place where you can sharpen your axe. To me i believe that ISB will help me sharpen my axe. Every person needs to decide what will sharpen their axes..
The Wise men:
It is this small percentage of the population that typically understands the value of a quality education and the greatness of ISB. When i meet up with this group, i am at home and reason out bigger things.
The wealth maxi"misers"
This group's first question is how much does it cost to an MBA from ISB? When i tell them that its about Rs. 14 lakhs (Food and acco extra). They are then dumbfounded and ask me the same question again just to recheck if they heard me right. They then respond back saying that, It is so costly, it does'nt make to sense to spend that much money to study.
What is costly? Is a reliance stock priced at around Rs. 1900 about 400 times more costlier than Pentamedia Graphics stock which is priced at about Rs. 5? The mathematical answer to this question is a simple YES. But that's not an answer you expect from good investment analyst. Comparing two things purely based on their absolute prices is not just useless but quite dangerous. If ISB does make sense in your career and if you take ISB as an investment and undertake an effort to calculate the NPV by a discounted cash flow method and compare it with the NPV of your career without it, am sure your investment will more than be justified.
But i know that these people cannot be convinced as they generally don't hear what they don't like to hear. So, when i meet up with these people i just smile :-)
The woodcutters:
This group's reaction is "Why did u leave the job to go and study?" Leaving a job at this stage is foolish. When i meet up with them i am reminded of the woodcutter's story. Some woodcutters never waste anytime and keep cutting trees without checking if their axe is sharp enough. Sharpening the axe tantamount to wasting time and these woodcutters hence doesn't indulge in this activity.
My reaction when i meet up with these people is "I am sharpening my axe". I don't claim that ISB is the only place where you can sharpen your axe. To me i believe that ISB will help me sharpen my axe. Every person needs to decide what will sharpen their axes..
The Wise men:
It is this small percentage of the population that typically understands the value of a quality education and the greatness of ISB. When i meet up with this group, i am at home and reason out bigger things.
Wednesday, July 18, 2007
And what a term it was....
Our term 2 just got over. When some seniors suggested that term 2 and term 3 would be the toughest part of ISB life , i did not realize what they actually meant. But now that the term is over i fully subscribe to their view..
Of the four subjects we had in term 2, u cant prepare (in the traditional sense) for three of them. Apart from these, we had loads of stuff to do in terms of assignments, pre reads, decision submissions, case analysis, self studies and the club activities which had kicked started in this term.
I am a active member in two clubs - consulting and finance. I hold a position in the finance club as Director, Corporate Banking. These professional clubs are student initiatives and is an important aspect of ISB culture. They provide a platform to interact with alumni and professionals in the field and helps us explore career opportunities. We had three very good presentations in the consulting club during the term - by Deloitte, Mc Kinsey and BCG.
Consulting is one of the fanciest word in a B-school. Most of us(me included) are tempted by the intellectual kick, the moolah and the fast career path that a consulting job promises to offer. Hence there was an excellent turnout for all these presentations. We had also started off the internal speaker series sessions for the finance club, wherein the directors of each vertical in the club made presentations about basic stuff in their respective fields.
Overall term 2 just zoomed past.. In the hindsight i think i had learnt a lot of new things in this term. I had to deal with some of my weakest areas and now i can safely say that, while the journey was tough the results are worth it... As someone said "One can't become a butterfly by remaining a caterpillar"...
Of the four subjects we had in term 2, u cant prepare (in the traditional sense) for three of them. Apart from these, we had loads of stuff to do in terms of assignments, pre reads, decision submissions, case analysis, self studies and the club activities which had kicked started in this term.
I am a active member in two clubs - consulting and finance. I hold a position in the finance club as Director, Corporate Banking. These professional clubs are student initiatives and is an important aspect of ISB culture. They provide a platform to interact with alumni and professionals in the field and helps us explore career opportunities. We had three very good presentations in the consulting club during the term - by Deloitte, Mc Kinsey and BCG.
Consulting is one of the fanciest word in a B-school. Most of us(me included) are tempted by the intellectual kick, the moolah and the fast career path that a consulting job promises to offer. Hence there was an excellent turnout for all these presentations. We had also started off the internal speaker series sessions for the finance club, wherein the directors of each vertical in the club made presentations about basic stuff in their respective fields.
Overall term 2 just zoomed past.. In the hindsight i think i had learnt a lot of new things in this term. I had to deal with some of my weakest areas and now i can safely say that, while the journey was tough the results are worth it... As someone said "One can't become a butterfly by remaining a caterpillar"...
Friday, July 13, 2007
Kelly Criterion
Came across this concept while preparing for my exams and found it very interesting. This is basically a rule which helps us decide how much of our wealth we ought to bet in a situation, in which we have a percentage advantage.
Simply put this formula says that the optimum fraction for the bet is "Edge over odds". That is bet a fraction your bankrole (wealth) equal to the advantage you have when compared to a fairgame. If you have a 52% chance of winning a fairgame, your edge is 2% (52%-50%) and your odds is 52%. Hence the optimal fraction that maximises the expected growth of the intial wealth is 2%/52% or 3.85%
Whats more intersting is that the way this formula was developed. This was originally developed by John Kelly (AT & T Labs) based on the work of his colleague (Claude Shannon) who had originally developed an application for dealing with noise issues arising over long distance telephone lines. Kelly then showed how Shannon's "information theory" could be applied to the problem of a gambler who has inside information about a horse race, trying to determine the optimum bet size. The gambler's inside information need not be perfect (noise-free) in order for him to exploit his edge.
This application now finds wide application in gambling, statistical logic, blackjack and in stock markets.
Simply put this formula says that the optimum fraction for the bet is "Edge over odds". That is bet a fraction your bankrole (wealth) equal to the advantage you have when compared to a fairgame. If you have a 52% chance of winning a fairgame, your edge is 2% (52%-50%) and your odds is 52%. Hence the optimal fraction that maximises the expected growth of the intial wealth is 2%/52% or 3.85%
Whats more intersting is that the way this formula was developed. This was originally developed by John Kelly (AT & T Labs) based on the work of his colleague (Claude Shannon) who had originally developed an application for dealing with noise issues arising over long distance telephone lines. Kelly then showed how Shannon's "information theory" could be applied to the problem of a gambler who has inside information about a horse race, trying to determine the optimum bet size. The gambler's inside information need not be perfect (noise-free) in order for him to exploit his edge.
This application now finds wide application in gambling, statistical logic, blackjack and in stock markets.
Thursday, July 12, 2007
The broken window fallacy
I came across this concept as a part of our Macroeconomics course. I found this one quite interesting as it helps us weigh economic arguments... The parable is as follows:
A little boy breaks a shopkeeper's window. Everyone sympathizes with the man whose window was broken, but pretty soon they start to suggest that the broken window makes work for the repairman, who will then buy bread, benefiting the baker, who will then buy shoes, benefiting the cobbler, etc. Finally, the onlookers conclude that the little boy was not guilty of vandalism; instead he was a public benefactor, creating economic benefits for everyone in town.
The fallacy in the argument is, had the shopkeeper not spent his money on repairing his window, he would have spent it on the new suit he was saving to buy. The broken window didn't create net new spending, it just diverted spending from somewhere else.
People see the activity that takes place but they don't see the activity that would have taken place.
Most of us claim that we are extremely busy and that we do not find time for anything. Taking this logic forward, it would do good if we pause and ask ourselves, are we "productive" or just plain "busy"?
A little boy breaks a shopkeeper's window. Everyone sympathizes with the man whose window was broken, but pretty soon they start to suggest that the broken window makes work for the repairman, who will then buy bread, benefiting the baker, who will then buy shoes, benefiting the cobbler, etc. Finally, the onlookers conclude that the little boy was not guilty of vandalism; instead he was a public benefactor, creating economic benefits for everyone in town.
The fallacy in the argument is, had the shopkeeper not spent his money on repairing his window, he would have spent it on the new suit he was saving to buy. The broken window didn't create net new spending, it just diverted spending from somewhere else.
People see the activity that takes place but they don't see the activity that would have taken place.
Most of us claim that we are extremely busy and that we do not find time for anything. Taking this logic forward, it would do good if we pause and ask ourselves, are we "productive" or just plain "busy"?
Wednesday, July 11, 2007
Nonsense
I recently came across an article published by BCG on this topic. Its fascinating. A few perspectives i enjoyed from the articles are:
The importance of nonsense can hardly be overstated. The more clearly we experience something as "nonsense", the more clearly we are experiencing the boundaries of our own self-imposed cognitive structures. "Nonsense" is that which does not fit into the prearranged patterns which we have superimposed on reality. There is no such thing as "nonsense" apart from a judgmental intellect which calls it that.
Those who establish the established lines of thought, however, are those who do not fear to venture boldly into nonsense, into that which any fool could have told them is clearly not so. This is the mark of the creative mind; in fact, this is the creative process. It is characterized by a steadfast confidence that there exists a point of view from which the "nonsense" is not nonsense at all - in fact, from which it is obvious.
The importance of nonsense can hardly be overstated. The more clearly we experience something as "nonsense", the more clearly we are experiencing the boundaries of our own self-imposed cognitive structures. "Nonsense" is that which does not fit into the prearranged patterns which we have superimposed on reality. There is no such thing as "nonsense" apart from a judgmental intellect which calls it that.
Those who establish the established lines of thought, however, are those who do not fear to venture boldly into nonsense, into that which any fool could have told them is clearly not so. This is the mark of the creative mind; in fact, this is the creative process. It is characterized by a steadfast confidence that there exists a point of view from which the "nonsense" is not nonsense at all - in fact, from which it is obvious.
Monday, July 9, 2007
Drinking water from a hosepipe
An one year MBA programme is really like drinking water from a hosepipe. That too doing the programme from a school of the stature of ISB brings with it a lot of challenges..
We get the best of the professors and are exposed to the latest in management thinking. To get the best out of this requires lot of effort, commitment, intellectual curiosity and guts. Some people get overwhelmed by this information overload and stop learning. Some others are so much caught up in the details that they just forget the big picture and miss the woods for the trees.
In my view i think a balanced approach to this would do a lot of good. Everything that is taught need not be in our area of interest. But it is important to know that such things do exist. Even a mere knowledge that something exists will help us become better managers than not knowing at all. Moreover as future leaders of organizations we can always hire specific talent for a functional role, but we may not be in a position to get the best out of others if we are ourselves unaware of the possibilities.
My two cents for all the future MBA aspirants, think a few hundred times why you need to do an MBA? Don't do it unless you get a clear and a compelling reason. Because its this clarity that will help you cruise through this course. It is this clarity which will give you the special power to drink water from a hosepipe and enjoy it too..
We get the best of the professors and are exposed to the latest in management thinking. To get the best out of this requires lot of effort, commitment, intellectual curiosity and guts. Some people get overwhelmed by this information overload and stop learning. Some others are so much caught up in the details that they just forget the big picture and miss the woods for the trees.
In my view i think a balanced approach to this would do a lot of good. Everything that is taught need not be in our area of interest. But it is important to know that such things do exist. Even a mere knowledge that something exists will help us become better managers than not knowing at all. Moreover as future leaders of organizations we can always hire specific talent for a functional role, but we may not be in a position to get the best out of others if we are ourselves unaware of the possibilities.
My two cents for all the future MBA aspirants, think a few hundred times why you need to do an MBA? Don't do it unless you get a clear and a compelling reason. Because its this clarity that will help you cruise through this course. It is this clarity which will give you the special power to drink water from a hosepipe and enjoy it too..
Contact lens for Chickens
Weird... you may think. But its true. We recently learnt about a company which makes contact lens for chicken. But of course this lens is not for bettering the vision, its actually for partially blinding a chicken. Apparently this increases the lifespan of a chicken and gives a host of other benefits.
We learnt a lot of management stuff by doing this case.. but apart from all these, i was amazed by the sheer ingenuity of human thinking. Who could have ever thought of making a contact lens for a chicken and trying to make money out of it too..
It reinforces my belief that there is no dream too large, no innovation unimaginable and no frontiers beyond our reach..
P.S: If you think i was fooling around check out www.opticaldistortion.com
We learnt a lot of management stuff by doing this case.. but apart from all these, i was amazed by the sheer ingenuity of human thinking. Who could have ever thought of making a contact lens for a chicken and trying to make money out of it too..
It reinforces my belief that there is no dream too large, no innovation unimaginable and no frontiers beyond our reach..
P.S: If you think i was fooling around check out www.opticaldistortion.com
Sunday, July 8, 2007
The Damocles sword
In Greek mythology this refers to the sharpened sword which hung directly above the head of Damocles (A courtier in the court of Dionysius), held in its place only by a single strand of horsehair. The expression "Damocles Sword" is a frequently used allusion to this tale, epitomizing the imminent and ever present peril faced by those in power.
We have a modern version of this in ISB too... Most of our assignments have unearthly deadlines such as midnight, 2 AM etc. We are expected to drop a finished copy of our assignments in a wooden box (very much like a post box) which is usually kept somewhere near the atrium (the centre of the school). This box would make its initial presence somewhere 36 - 48 hrs before the deadline and would dematerialize at the appointed hour. Any assignment which does not find its place in this box by the deadline, is not graded.
These boxes have become very much a part of our lives now-a-days and remind me of the Damocles sword. Their very appearance makes us realize the ever present peril and steals away our little joys...
On my way back to the room, I just spotted another sword... :-(
We have a modern version of this in ISB too... Most of our assignments have unearthly deadlines such as midnight, 2 AM etc. We are expected to drop a finished copy of our assignments in a wooden box (very much like a post box) which is usually kept somewhere near the atrium (the centre of the school). This box would make its initial presence somewhere 36 - 48 hrs before the deadline and would dematerialize at the appointed hour. Any assignment which does not find its place in this box by the deadline, is not graded.
These boxes have become very much a part of our lives now-a-days and remind me of the Damocles sword. Their very appearance makes us realize the ever present peril and steals away our little joys...
On my way back to the room, I just spotted another sword... :-(
Saturday, July 7, 2007
I-Min
Last Sunday me and my wife watched Spideman-3 in Hyderabad Imax. It was a good movie. On my way back, i got excited about a new idea... The I-Min.
Why can't i start a new theatre chain on the concept of I-Min? This works exactly opposite to the I-max concept. I-max is all about big things.. I-Min is all about small things. There would be a very small screen in the centre, people need to use special glasses to watch the movie. These special glasses will magnify the images and bring them the theatre effect. Each seat would have headphones, so people could adjust volumes as they desire.
I can have multiple screens in the centre and can hence show different movies at the same time. Since each seat will have a personalized audio, this should not be a problem. All people watching a particular movie will be seated facing that particular scree. I dont even need a closed theatre... and hence can accomodate a much bigger audience.
Thats it... here is a theatre, which screens so many different movies at the same time. People can personalize their audio, more space, more personalization, no queues, better box office collections... Thats the world of I-Min
Dont laugh.... who knows what will happen tomorrow...When telephone was first invented and Western Union was given a chance to buy all rights for the telephone patent for just $ 100,000, its then Chairman asked "What use could this company make of an electrical toy?" :-)
Why can't i start a new theatre chain on the concept of I-Min? This works exactly opposite to the I-max concept. I-max is all about big things.. I-Min is all about small things. There would be a very small screen in the centre, people need to use special glasses to watch the movie. These special glasses will magnify the images and bring them the theatre effect. Each seat would have headphones, so people could adjust volumes as they desire.
I can have multiple screens in the centre and can hence show different movies at the same time. Since each seat will have a personalized audio, this should not be a problem. All people watching a particular movie will be seated facing that particular scree. I dont even need a closed theatre... and hence can accomodate a much bigger audience.
Thats it... here is a theatre, which screens so many different movies at the same time. People can personalize their audio, more space, more personalization, no queues, better box office collections... Thats the world of I-Min
Dont laugh.... who knows what will happen tomorrow...When telephone was first invented and Western Union was given a chance to buy all rights for the telephone patent for just $ 100,000, its then Chairman asked "What use could this company make of an electrical toy?" :-)
Thursday, July 5, 2007
Global Macro Trends
Today Mr. Dipak Jain, Dean of Kellogs delivered a talk on this subject. He is simply amazing. His life is an inspiration. Born in a small town in Assam in an ordinary family, he ends up as the first Indian to ever head a leading business school in US.
Some inetersting stuff i picked up from his speech..
When you think of competition, think beyond boundaries. Eg. For an Airline, a videoconfercing company could be a serious competitor than another airline.
The fastest growing demographic segments in Europe, Japan and US is 65+ yrs. In India it is 35-. China is also at a distinctly disadvantageous position as compared to India, because of its "one child" policy adopted earlier. China could hence get old before it gets rich and India would get rich before it gets old.
To delight the ever incresing segment of demanding customers, it is not enough if you innovate products or processes. You need to innovate business models. Eg. Google. This company realized that its customer is not the person who searches, but the website which is being searched.
He also had his share of one liners... some of which i enjoyed are..
1. Marketing is not a function. Its a mindset
2. If u enjoy what u are doing, you dont have to work
3. You are at your best when you have nothing to lose
4. Don't wait for the elevator of success, take one step at a time. Atleast you will go up
5. The challenge ahead of you is never greater than the force behind you
6. Luck is like the deck of cards you get. What you make of it is efforts
And the best one is....
People who eat square meals, end up round
Some inetersting stuff i picked up from his speech..
When you think of competition, think beyond boundaries. Eg. For an Airline, a videoconfercing company could be a serious competitor than another airline.
The fastest growing demographic segments in Europe, Japan and US is 65+ yrs. In India it is 35-. China is also at a distinctly disadvantageous position as compared to India, because of its "one child" policy adopted earlier. China could hence get old before it gets rich and India would get rich before it gets old.
To delight the ever incresing segment of demanding customers, it is not enough if you innovate products or processes. You need to innovate business models. Eg. Google. This company realized that its customer is not the person who searches, but the website which is being searched.
He also had his share of one liners... some of which i enjoyed are..
1. Marketing is not a function. Its a mindset
2. If u enjoy what u are doing, you dont have to work
3. You are at your best when you have nothing to lose
4. Don't wait for the elevator of success, take one step at a time. Atleast you will go up
5. The challenge ahead of you is never greater than the force behind you
6. Luck is like the deck of cards you get. What you make of it is efforts
And the best one is....
People who eat square meals, end up round
Wednesday, July 4, 2007
Think Small
This might sound contrary to popular wisdom... But this is the advice one of our professors gave us. Most often we get caught up in dreaming big and in weaving elaborate plans that we forget to concentrate on the details...
Great ideas and great products fail because of small issues.. The B2 "Stealth Bomber" had cost billions of dollars to develop. But its design is fundamentally flawed because two aerodynamicists made a mistake.. They used mathematical formulas to determine how an aircraft’s volume should be proportioned between wing and fuselage in order to maximize its range. Taking derivative of the range with respect to the volume, they found that this derivative equaled zero when the total volume was almost all in the wing. Hence they concluded that a “flying wing” design would maximize range. What they forgot was “taking the second derivative”. This happened to be positive in this case. Thus the flying wing actually minimized the range. The flying wing was the aerodynamically worst possible choice of configuration.
Small mistake… but a rather costly failure… The devil is in the details.. Think small
Great ideas and great products fail because of small issues.. The B2 "Stealth Bomber" had cost billions of dollars to develop. But its design is fundamentally flawed because two aerodynamicists made a mistake.. They used mathematical formulas to determine how an aircraft’s volume should be proportioned between wing and fuselage in order to maximize its range. Taking derivative of the range with respect to the volume, they found that this derivative equaled zero when the total volume was almost all in the wing. Hence they concluded that a “flying wing” design would maximize range. What they forgot was “taking the second derivative”. This happened to be positive in this case. Thus the flying wing actually minimized the range. The flying wing was the aerodynamically worst possible choice of configuration.
Small mistake… but a rather costly failure… The devil is in the details.. Think small
Intro
I have updated my complete profile in the blog.
Am currently pursuing my PGP in management from ISB... This institute rocks and there are loads of interesting perspectives i pick up everyday..
I hope to share these with u all through this medium..
Am currently pursuing my PGP in management from ISB... This institute rocks and there are loads of interesting perspectives i pick up everyday..
I hope to share these with u all through this medium..
Monday, July 2, 2007
The newborn
I have never prided myself as a writer. I had never kept any dairy records till now. Most often than not, I am also very selective in sharing my views. Why then this sudden love for blogging?
Am really not sure… But one important benefit I get to derive out of this activity is that, I will get to follow my own trail of thoughts. Its thoughts that make a man. By studying my own thoughts I believe that I will be in a better position to steer them.
Whats in it for the readers…. A new perspective, world looked at from another set of glasses, a chance to interact with one of the future leader of the business world (Yes… you read it right…. If I myself don’t believe this, am sure no one else will ever buy it ;-))
Who am i? What do I do? Where am I headed?..... in my next blog.
I have never prided myself as a writer. I had never kept any dairy records till now. Most often than not, I am also very selective in sharing my views. Why then this sudden love for blogging?
Am really not sure… But one important benefit I get to derive out of this activity is that, I will get to follow my own trail of thoughts. Its thoughts that make a man. By studying my own thoughts I believe that I will be in a better position to steer them.
Whats in it for the readers…. A new perspective, world looked at from another set of glasses, a chance to interact with one of the future leader of the business world (Yes… you read it right…. If I myself don’t believe this, am sure no one else will ever buy it ;-))
Who am i? What do I do? Where am I headed?..... in my next blog.
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