Saturday, April 3, 2010

Connect with people

Saturday, April 3, 2010
I have had the opportunity of working closely with a company that manufactures and sells paints. Let's call it ABC. It was established in 2001 and began its operations in a small way by making and selling cement paint. Over the years, it has grown its product portfolio and now has operations in 11 states across the country. It is still small, compared to the existing giants of paint industry . But its growth over the years has been steady and impressive.
When I first met this company in 2009, it had a simple setup. Led by a managing director, it has a sales staff across 11 zonal offices and manufacturing plants in Rajasthan and Jharkhand. Not much has changed in the structure in the one year. But compared to its CAGR of around 20%, it posted an astounding growth of 62% in FY 2009-10. So what had changed in this one year? The way of connecting with people.

My friend Swati is a media consultant for this company. In 2009, the MD told her that he could now afford to spend on TV commercials and was ready to spend as much as 1 crore towards this. Swati belongs to that breed of consultants who believe in keeping the benefit of the client uppermost in mind, and actually suggested that the money could be better spent in alternative means, like painter meetings and wall paintings. Most importantly, she told the MD that he ought to spend some money out of this budget on conducting a sales conference. Indeed, in the 9 years of its existence, the sales staff of this company had never met each other.
That's how we all met in Jodhpur in July 2009 for the 1st ever sales conference of ABC. It was exciting time for the salesmen, many of whom had  never stepped out of their native districts in their lifetime. The conference consisted of technical presentations on new products to be launched, discussions on media spends and painter meetings and of course setting goals for the next year.
In addition to this business agenda, we conducted simple exercises for the members, highlighting the basics of effective management and selling skills. No fancy presentations, no psycho-babble and management jargon. Simple, down to earth stuff. As the facilitator, I avoided giving them ready-made solutions. Instead, I encouraged them to share their experience and learn from each other.
The session on goal-setting had a tremendous impact. Over the years, the zones kept performing at varying efficiency. Whenever the MD would visit a zone and tell them about the success story of another zone, they would never believe him. On the contrary, they suspected that he was simply inflating the figures just to motivate them. This all changed during the conference. The goal-setting was done in an 'open-house' environment and everybody could witness everybody else's next year target (with the promised incentives, of course.) This came as an eye-opener for all. Long back, I had read how Ricardo Semler used innovative techniques in Semco SA, leading to radical reforms and his version of 'industrial democracy'. I had found that incredulous and wondered whether this could ever be applied in an Indian setting. ABC has proved to me that it is possible.
The results are there for everyone to see. The growth rate has jumped from 20% to 62% in an year. The attrition rate is down to virtually zero for the first time in nine years.
Now the talks are on for the 2nd sales conference in July this year. More exciting times are ahead.
It is a shining example for people who focus on the business processes so much that they end up ignoring the human processes. No organization can grow in that manner. "People are our biggest asset" is not something to write on the walls. It is something to follow.


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