Jack Welch & the GE Way

Recently, I finished reading this book and it is the most interesting book on Management Insights and Leadership secrets of the Legendary CEO Jack Welch. Robert Slater has contributed so well and it is his second book on Jack Welch. GE is the most valuable company in the world and Jack Welch, GE’s CEO is the most acclaimed CEO of the world. This book tells in details the Welch Strategies and Management Secrets. Under his leadership, GE became the first company in the world to apply six-sigma strategy in their work.

This book also offers a rare look into the mind of Jack Welch illuminating his vision and prescriptions for the future of business. Slater has highlighted the GE revolution of achieving double-digit growth in a boundary less organization and feature over 30 of Jack Welch’s leadership secrets. Jack Welch does not believe in sitting still. His innovative, breakthrough leadership strategies as CEO have transformed GE into a highly productive and labor efficient powerhouse. One of the good quotes in this novel is “Act like a leader not a manager.”

One of the Welch strategies that I like in this book is – “Welch was open to take feedback from every employee of his organization, starting from a labor employee to a General Manager.” Companies will do well to with this advice on how to foster an open ended, informal work atmosphere that will encourage employees to speak out, breaking down the walls of hostility between managers and subordinates.

His commitment towards the organization motivates his employees. Welch commitment and dedication for the company came when he said, “GE will be the top most production company in the sector, otherwise GE will stop producing products.” This statement and vision of Jack Welch drives GE into the top Fortune 500 companies. In 1997, GE led Business week list of all companies worldwide in market value for the second consecutive year and achieved near top ranking of the most profitable companies in the U.S.

This book gives an overview of Welch philosophy on how to manage and how not to manage and covers topics such as building a market-leading company, forging the boundary less organization, harnessing people for competitive advantage, pushing service, and globalization for double-digit growth. 

Indian E-commerce Train

Indian e-commerce is projected to explode from $10 Billion to $43 Billion in the next five years. There are eleven categories and within them 42 players that are poised to shape this blazing path. Let us look at e-commerce industries in different categories, their investors, and funding raised by them.

The first in the category of e-commerce is Market Place. This multi category segment is on fire this year. The largest pie of the line retail ecosystem is drawing the maximum risk capitals and eyeballs. The top three players – Flipkart, Snapdeal, and Amazon are expected to do $4 Billion in sales this fiscal. All multi category players are on the Inventory less market place model. They are all investing heavily in warehouses and delivery. They are making acquisitions. Their focus is now on growth and less on profitability. Investors in Flipkart are Accel and Tiger Global. Investors in ShopClues are Nexus Venture and Helion Ventures. Snapdeal investors are Kalaari, Nexus Venture, Intel Capital, Bessemer, eBay, and Premji Invest.

The second category in the list is Travel. If multi product players have the eyeballs then travel portals have the wallet. At around $8 Billion, online travel accounted for 70% of the overall Indian e-commerce market in 2013. Three shifts are underway, one with air tickets becoming a staple, travel portals are turning their focus to hotel bookings and travel packages. There is a growing emphasis on smartphone traffic and applications. Big players are Cleartrip, Expedia, Ibibo, IRCTC, Makemytrip, RedBus, and Yatra. Investors in Cleartrip are Concur Technologies and Reliance Ventures. Investors in Makemytrip are SAIF partners, Tiger Global. Investors in RedBus are Naspers. Yatra investors are Capital 18, Norwest, Intel Capital, IDG Ventures, Vertex, and Valiant Capital.

The other category in Indian e-commerce is Fashion. After electronics, fashion and lifestyle is the largest industry in online retail with a 25% share. Myntra and Jabong are the leaders competing fiercely with discounts and for exclusive brand partnerships. Myntra is launching private labels including Roadster and Dressberry. With external brands give up to 35% and in house labels go up to 60%. Jabong is in partnerships with international brands and designers. Other players are Yepme, Fab Alley, and Zovi. Investors in Jabong are Rocket Internet. Investors in Myntra are Kalaari, Accel, Tiger Global, IDG Ventures, and Premji Invest. Investors in Yepme are Helion Ventures. Investors in Zovi are SAIF Partners and Tiger Global.

Furniture is the third largest segment in e-commerce. The value of goods sold by leading players is on course to increase 3-4 times this fiscal. Pepperfry and Urban Ladders are the leaders. Among market places, Snapdeal has launched and Flipkart, Amazon are exploring. In this industry, players need to build a specialized supply chain and help in building the manufacturer ecosystem. Pepperfry is working with manufactures to build furniture that can be assembled on delivery. Other players are FabFurnish and Zansaar. Investors in FabFurnish are Rocket Internet. Investors in Pepperfry are Norwest and Bertelsmann. Investors in Urban Ladder are Steadview, SAIF Partners, and Kalaari Capital. Investors in Zansaar are Accel and Tiger Global.

With an estimated market of $350-400 Billion, the grocery segment is larger than anything else is. It is also challenging. One needs to build Hyper-local sourcing, warehouses, and supply chain. Expansions across regions are staggered. The exception is BigBasket, which is in three cities. Other players are Ekstop, LocalBanya, IndiaMart, Homogennie, and Zopnow. Investors in BigBasket are Ascent Capital and K Ganesh. Investor in Ekstop is Unilazer. Investor in LocalBanya is Karmvir Avant Group. Zopnow investors are Accel Partners, Qualcomm, and Times Group.

Hyper-local market is the other growing category in India. Even if big players enter into market then also small shops and establishments will make a large percentage of sales. Platforms like Just Dial, Findable, PriceBaba, and Zopper are looking to bring them online in multiple ways. BookMyShow is doing the same with ticket bookings in arts and entertainment. Just dial the largest local search player with revenues of Rs. 561 crore in 2013-14 extended into transactions this January, enabling services like doctor appointments and flower deliveries. Zopper and PriceBaba are also expanding quickly. With smartphones and data connections, their numbers are expected to increase. Investors in Just Dial are Tiger Global, SAIF Partners, and Sequioa. Investors in Zopper are Tiger Global, Nirvana Ventures, and Blume.

Some e-commerce websites are differentiating by targeting niche customer profiles. GreenDust sells factory second and refurbished consumer electronic products at a 10% - 76% discount to market price. Limeroad is a social shopping platform focused on women that also offers users tools to curate and share collections offline. Onemi sells products only on equated monthly installment even to customers who do not have a credit card. Overcart is also a new startup. Investors in GreenDust are Lightbox Ventures, Vertex, and Reliance. Investors in Limeroad are Tiger Global, Matrix Partners, and Lightspeed. Investor in Onemi is VenturEast. Investor in Overcart is K Ganesh, and GSF Superangels.

Other than these, there are some smaller specialists in different categories. First is the Babycare category. Babycare and kids wear products categories are emerging. The leader is Pune based FirstCry. FirstCry is flanking its online presence with stores – 70 running and 30 more coming this year. It is collaborating International brands to provide free hospital kits to parents of newborns in about 6,000 hospitals in top 18 cities. Other players are Babyoye and Hopscotch. Investors in Babyoye are Tiger Global, Accel, and Helion Ventures. Investors in FirstCry are SIAF Partners, IDG Ventures, and Unilazer. Investors in Hopscotch are Lion Rock Capital, and Nisaba Godrej.

Healthcare is one segment where niche portals have managed to build strong franchises. While focus of Healthkart is protein supplements and personal care, that of Lenskart is eye care. It expects post revenue of Rs. 100 crore this fiscal. Other startups in this segment are Healthadda, Helathgenie, and Saralhealth. Investors in Healthkart are Intel Capital, Sequoia, and Kae Capital. Investors in Lenskart are Unilazer Ventures and IDG ventures.

Stores in general, have failed to offer Indian women a wide choice of products or a comfortable shopping experience. Online players are stepping in, offering wide variety of products, new categories like shapewear and the privacy to shop without human contact. China largest category in e retailing is apparel. Online players are PrettySecrets, Koovs, and Zivame. Large players like Flipkart, Myntra could acquire them to make these brands anchor tenants on their website. Investors in PrettySecrets are Rehan Yar Khan. Investors in Zivame are Unilazer Ventures, IDG Ventures, and Kalaari Capital.

India’s appetite for jewellery is growing every year. Players are entering into online platforms and Bluestone, Caratlane are some established players. Investors in Bluestone are Accel Partners, Kalaari Capital, and K Ganesh. Investors in Caratlane are Tiger Global. Online business is also growing in Food Chains sector. Platforms like Zomato and TastyKhana are offering in wide categories. While Zomato is into restaurants chains and it is Google of Food, TastyKhana delivers your food in quick span of time. Medical shops are also entering into online selling and delivering of medicines. Apollo Pharmacy, 98.4, and local keepers are entering. In flower delivery service, Ferns & Petals, and other players are emerging. Taxi and Ride booking is also emerging at a rapid pace. Electronic stores, customize printing business, fruits and vegetables,  are some other categories where business is growing. It is expected that after five years everything in India will be available online.