Posted tagged ‘leadership traits’

My Experiences -Last time (MELT) – 1214

December 30, 2014

Last blog of the year?

People who are following my blogs must have noticed that my blogs 0714 to 1114 has gone missing. I was tempted to write on few topics and even had a sketch and outline on what I wanted to write but did not follow through as I thought those topics would create controversy in my social and professional circle and therefore reserved it for better and appropriate time. I am sure this is sounding curious and this will raise many thoughts on what those topics could be. Have patience it will be pressed (sic) sooner than later. I did not want to give a simple explanation for my disappearance such as “I went on sabbatical”.

Another year has come to an end and like any other year this year has been different in many ways. Couple of thought provoking events that stand out, from my perspective, which we need to be aware and conscious of

  1. Disappearance of three Aircrafts  this year – Is this a noise or a signal
  2. Uber rising to fame – Can the disruptive idea/model be copied in other businesses (albeit recent  bad publicity)
  3. New way of terrorist thinking- Recent attacks on school Children in Pakistan.

As you stay with these thoughts, I will write more on these topics in 2015.

Let me take this opportunity to wish all my readers a Happy and Prosperous New Year.

Back to the future

In early 80’s, an ordinary movie ticket used to cost RS 4( 50 cents)   and  Coke or its substitute was around Re 1 per 200 ml ( 12 cents based on exchange rate prevailing in those days). As the years progressed invention of VHS and mushrooming of cable television made access to movie very easy. Many liked the concept of viewing movie in the comfort of their drawing room or bedroom. Further invention of DVD made the quality of viewing better. The digital content also posed a big challenge to anti- piracy. Many theatres in US went bankrupt and people seriously questioned the survival of movie industry. Few television movies and success of soap operas added fuel to the fire. In India the concept of multiplex was at nascent stage (one could spot few in Chennai but not in other cities) and no business was willing to invest on a sunset industry.

Fast forward to present

Transformers: Age of extinction grossed over a billion dollar in 2014. Iron Man 3 grossed a similar amount in 2013. Avatar was the highest revenue earner with $2,7 billion in 2004. Coming to Bollywood, PK an Indian movie grossed around $36 million in 11 days.  Lingga, a regional Indian movie, has grossed $6 million in first six days.

What has changed since 1980? An industry once categorized as sunset started grossing billions of dollars in revenue? Take a guess – to me it is a four letter word. Don’t let your imagination get wild as I was referring to IMAX.

IMAX story:

IMAX is about filming in IMAX cameras and using a different film print as compared to normal print and projecting them in a curved screen that gave a unique viewing experience. The initial experiment of projecting a movie was confined to museums showing natural documentaries as the proposition was simple and less expensive. In 90’s it started licensing its technology to its theatres. This meant an investment of around $ 5million to create space for projection and cost of projector (as normal projector can’t process IMAX format). This was seen as expensive given that the movie industry was seen as sinking. Further, in the pre-digital era, IMAX version of the film print was $30,000 as compared to $1,000 for a normal print. An IMAX print was bulky and it needed extra efforts to lift to the projection room. All these factors made things difficult for IMAX. IMAX also tried producing their own movie using IMAX cameras but the venture was not that successful. Although, everyone acknowledged that IMAX experience was much better than normal theatre experience, the cost and the effort was not worth it even though the initial investment got reduced from $5 million to $1.2 million.

In early 2000, the company took the strategy of installing IMAX projection free of cost and let the theatres deal with the cost of renovating the space (which was roughly 10% of initial investment). In return, IMAX received 12.5% as revenue share for providing the projectors. The theatres could charge at least 20% more on IMAX format of the movie. Further, another technology breakthrough of converting existing movies to IMAX format helped them to make a dent in their market share. But these were not sufficient reason for them to celebrate as their main goal was changing the way Hollywood was producing pictures using IMAX technology and giving differential experience.

They continued to struggle as there were still not enough believers in investing in IMAX. Changing the Hollywood way of doing business over 100 years was another barrier. No bankers came forward to give them line of credit and shares were traded at paltry 55 cents and effort for LBO failed miserably. Mid 2000 was sternest test for IMAX leadership in keeping the morale and motivation of their employees high.

In 2006 another technology breakthrough of replacing their projectors with a plug and play hard drives (costing $150) helped them install in more theatres. In the next few years network of IMAX screens grew from some 350 to 700.

Eventually, their perseverance and new business model of revenue share ( 20% to IMAX) paid off in 2009 with the release of Avatar in IMAX screens. IMAX made $250 million dollar in revenue. It was a win-win situation as theatres could charge premium on tickets for IMAX version and shared portion of that to IMAX. Currently IMAX is adding some 100-150 screens every year and has penetrated various geographies.

Today the stock price is hovering around $30 per share ( as compared to 55 cents few years ago) You can make an impactful change in the industry you are operating with and its reported revenue is close to $300 million in 2014.

You can make impactful change in the industry you are operating by remaining flexible on your business model and keep innovating. The company took several wrong turns before navigating into the right path. So my recommendation is to keep plan B and C handy to change over quickly

By the way, today in a normal theatre a movie ticket would cost you RS 100( $1.40 cents) and IMAX Rs 250 ( $4) and bottle of coke costs approx. Rs 12 (20 cents)  for 200 ml. Coke price increased by 60% over three decades whereas movie tickets increased three fold( all in dollar terms)  Who would have predicted this two decades ago.

Dessert

“Change your thoughts and you change your world” – Norman Vincent Peale

I promise that I will write more frequently in 2015 as compared to 2014. With that promise I bid good bye with my usual signature “Life is Good”.

PS: IMAX is thinking of coming out with affordable home theatre. Will this create an impact on the theatres? Take a guess.

My Experiences -Last time (MELT) – 0313

February 24, 2013
 You need not be a Christian to follow the pope

The Prophet Isaiah once foretold

A Voice cries:

“In the wilderness prepare the way of the Lord,

make straight in the desert a highway for our God.

Every valley shall be lifted up,

and every mountain and hill be made low;

the uneven ground shall become level,

and the rough places a plain.

And the glory of the Lord shall be revealed,

and all flesh shall see it together;

for the mouth of the Lord has spoken

Pope Benedict XVI announced his resignation on 11th February; we could hear the gasping sound of not only many Christians but other good Samaritans from different cross walks of life. No pope had resigned in the last 600 years. Although this was not the first resignation in form but, to me, it was the first resignation in substance (how can I ever hide my accountant identity). Prior to him there were eight popes who had resigned. Most popes who had resigned in the past were either under duress or political turmoil or in other words did not resign of their free will. He was not the first pope Benedict to resign as Benedict V( 964) and Benedict 1X ( 1032-45) also resigned. Pope Benedict resigned for reasons which I quote here “ After having repeatedly examined my conscience before God, I have come to the certainty that my strengths due to an advanced age are no longer suited for the task”

He further added, which to my mind is the most important part of his reasoning, which I quote again “ both strength of mind and body are necessary , strengths which in the last few months have deteriorated in me to the extent that I have had to recognize my incapacity to adequately fulfill the ministry entrusted to me’.

This is one of the key transformational decisions I have ever come across for a long time. In one single moment he has redefined the role and the aura of the papacy. What needs to be read through this transformative message is deeper than what appears on the surface. He did not want to be a mere proxy and paved way for someone who can meet the immense demands of the church. Few other questions that crossed my mind are – what should be the right age for the pope? (I found out that most Popes in the last three centuries were in the age group of 60-75 when they assumed office) Should Popes serve terms like some country heads? When the Pope talked about strength – is this just a self-determination or, in future, some agency in Church could decide as well.

I am not a Christian but I do understand that Pope’s action has some ramification in other religions as well. Not only that,  as a corporate manager one needs to learn a greater lesson from this in terms of knowing when to let things go in the larger interest of corporation and society. If most leaders learn this lesson, the entire corporate world would be better served.

So I rest my case that one need not be a Christian to follow the pope.

Time Warner to sell magazines

You must be wondering that I am out of my mind after reading this sub heading. We all knew that Time Warner sells magazine (People, InStyle, Real Simple) so what is new about it. I just reproduced what I saw in one of the newspapers. I was curious as well and on detailed reading, I figured that Time Warner wants to sell their Magazine Division. Obviously, continuing in the paper media business is not making sense for them and hence this course of action.

These headlines made me think hard about the future of Magazine industry.First of all, is there a future for paper magazine? What is the differentiator for the news magazines? When do you read paper Magazines? I read when I am waiting in the saloon, in the aircraft when I can’t switch on my electronic device, waiting for doctor’s appointment etc. All these circumstances are forced one and not by choice. So I grab whatever is available and read for a while to kill the time. So I don’t care whether it is ‘Times” or “ News week”. I am sure Time Warner realized this and wants to get out of this business. The question that begs is “who wants to get in?”. Most News companies develop an app which people can download and read their favorite news. These apps which push news to your device are doing the job of “paper boy” delivering news to your door step.

Some reflection with nostalgia about morning newspapers – Gone are those days of sipping a hot coffee, eagerly waiting for the news paper boy to throw your favorite news paper into your balcony or door step. There used to be fight between family members on who picks the news paper first. Newspaper would lose its charm by noon and ready to be stacked for disposal. However, the quality of writing used to be great and my grandfather always advised me to read the editorial to improve my English skills. It is a different story today as evidenced by the headline I picked up from one of the newspapers. Electronic age has changed people’s habit of reading news and people learn as things develop. The focus of reading news paper in the morning has dwindled and the quality of the news coverage and art of writing news report is scarce these days. “AIG reports $ 4bn loss for this quarter” was the news I read last night. Someone reads it and immediately jumps to the conclusion that AIG is not doing well. However, reading between lines will tell you a different story. A good analyst would have reported “ AIG reports book loss but way to recovery”. Wait a minute! What am I talking here about reading between the lines? These days there are only headlines so where is the substantiate reporting? Most news reporting happens in SMS language. Who knows if this could be the language of future? There will be language schools teaching you SMS language. Teachers telling you OMG does not mean ‘Oh my goodness’ but it is “Oh My God”. There is a difference between the two. Goodness may not be necessarily equal to God. Apologies for the digression and abrupt end to this but I rest my case that paper media’s future is a question mark.

How our mind works- Sorry folks this is not cricket

Recently met one of my Indian Colleague (who grew up in US) along with a Australian friend in a bowling alley. I was playing bowling for the first time and the Australian was doing well. So I wanted to get into some mind games to embarrass my Australian friend. I pulled him into a conversation with my Indian colleague stating how Australians are good in under arm bowling (Reference Trevor Chappell incident in 1981). I assumed my other Indian colleague would follow the conversation as most Indians would follow cricket.  This was a fatal mistake as after I finished my conversation he uttered ‘ guys, I know you guys are talking something about cricket, but I don’t follow what you are talking about.’ I sheepishly apologized and switched topics to baseball. Lessons learnt –  Do not make a generic assumption. Always ask the question. How many times have we made an assumption about a person just based on their looks or the way they are dressed? How many times have we form an opinion  through our first impression? Food for thought and practice using more of our System-2 brain ( analytical and logical brain).

Dessert- Don’t worry be happy. Life is beautiful

See you soon.


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