Why I consider Marissa Meyers decision a step in the right direction for Yahoo!

There has been enough being said about Marissa Meyer’s memo to all Yahoo employees about asking all employees to report to work in office and not work remotely.

Most of the media and other leaders in the industry have gone on record saying that this is a step back into the past for Yahoo!

Most have shared statistics about the higher productivity that people have been reported among people working from home or remotely and how other organizations are fostering creativity and encouraging more people to work remotely.

I, however, agree that this is a step in the right direction for Yahoo! in the long term and my respect for Marissa has gone up tremendously for being able to take such a contradictory decision.

Yahoo! is at a stage where the company has been bereft of any game-changing innovations coming in from the organization. This is a classic case of an organization just drifting away and dying a slow death.

So, what Yahoo! needs right now is an infusion of new blood, vigor and a purpose!

What Yahoo! needs is a game changing innovation coming out of their kitty.

So, improving per employee productivity will not help this. Doing what you have always done will only get you the result that you have always got.

What this decision does is force people who are still interested in the future of the company to come together in a physical space. Others, who want the flexibility of tele-commuting could of course leave Yahoo!. In a way, such an exodus is also good for the company as this will give Marissa an opportunity to bring in new blood, with it new thinking, new

Also, this physical closeness, if managed well, can lead to a different culture within the organization, can create a new life-line for Yahoo! If any of you have worked in both close physical spaces and remotely on innovation projects (which I have done), you can attest to the fact that the physical closeness  brings in additional dynamics to the team which helps the teams to work much closer and faster. The chances that the team comes up with a break-through innovation is much higher if the teams work together in a physical space.

So, I think Marissa’s decision is in the right direction, if she and her team can manage the next few weeks well and is able to put together diverse teams in each office to start working on disruptive innovation projects. If done well, this could be the spring-board that can bring Yahoo! back to the big leagues..

All I can say is “All the best Marissa and team! Forget about what everyone in the world say about this decision. Just put your heads & heart to coming up with a game changing innovation! Keep at it!

Idea for a disruptive biz-model innovation for banks

There is a lot of discussions and activities around the revival of the good old ATM.

  • Some are trying to make these machines more Customer-centric like Wells Fargo.
  • Some are trying to improve the overall user experience of the ATM like Diebold.

However, the true question should be the following:

Do we even need an ATM? Is there a better, easier, faster way to manage cash than via an ATM?

The first bank to figure out the answer to this question has the potential to truly disrupt the banking industry from a cash management perspective.

One way that I think could be used is the small businesses that accept payments from a credit or debit card?

Can they not be used to function as a teller for the bank? The bank instead of charging a fee for the use of the card machine, can instead pay the business a nominal amount and convert them into cash dispenser.

All the technology that is needed to make this happen is already available. The only change is in the execution of the idea.

This is just one idea to enable this. There could be many more viable ideas.. The question is are we looking for them?

Do let me know your thoughts by posting your comments below or tweeting them to me at @rmukeshgupta.


Solving the healthcare crisis

A couple of weeks back, I was attending my cousin’s marriage ceremony in Chennai and my father got fever. He was also complaining of cough and difficulty in breathing. We took him to a clinic where a doctor gave some medication.

We came back to our hometown (Bangalore) the next day and took him to a hospital to do continue the treatment as the breathlessness did  not go away. The doctor who attended my father immediately asked him to get admitted in the hospital to enable better care. He was kept in the Intensive care unit for some time under observation and then moved to a private room, once the doctors felt that he had stabilized. Then started the series of tests and more tests. He was being given oxygen using a mask and some antibiotic medicine via IV apart from his regular medicines that he has been taking for a while now.

A day passed in the room and my father felt better. However, he still experienced some pain in the ribs when he coughed. This resulted in the doctor asking us to stay in the hospital for another day to do more tests and to keep him under observation.

I am no doctor and maybe do not understand if this hospitalization (of 3 days) was really necessary. But then, we did not complain, as there was no financial burden on us, as the cost of hospitalization would be covered by our health insurance policy.

In my opinion, a big reason for the  escalating healthcare costs in India is the fact that “Health Insurance companies are willing to reimburse the cost of treatment only if the patient gets admitted in the hospital. ”

No hospitalization = no reimbursement.

This creates a strong incentive for both the hospital (for obvious reasons) and the patient (to get the expense reimbursed) to go in for hospitalization even if it was not absolutely necessary.

Add to that, the hospitals can now do more tests, build bigger hospitals with more rooms and even more expensive equipment’s to do more tests. Though, this might help in building up infrastructure for better healthcare, all of these end up in escalating costs for insurance companies, which is then passed on to the consumers as an increase cost of insurance.

Now, imagine my plight if I did not have an insurance policy to cover my health. The treatment in good hospitals with good infrastructure would be prohibitively expensive, which in turn makes buying health insurance attractive.

So, everyone in the ecosystem of health care has a financial incentive to continue to drive the healthcare costs up, which ends up becoming a beast out of control.

So, how can we address this problem?

There are 2 kinds of solutions here..

  • Short term, quick wins: 
    • If insurance companies do not insist on hospitalization to cover the cost of healthcare, patients would not be so willing to get hospitalized. They would prefer hospitalization only if absolutely necessary.
    • If Insurance companies can find a way to incentivise hospitals for non-hospitalization, this coupled with the above will result in a quick win in reducing the overall cost for the insurance provider, which they can either pass on to their customers as lower cost of insurance or keep the savings as increased profitability.
  • Long term solutions:
    • Insurance companies to start and run a channel of clinics where insured can get good medical advice for free or very low cost. They will reimburse medical claims only if the hospitalization was recommended by one of the doctors from their clinics.
    • IF possible, they should also operate a chain of hospitals which can then be used to provide high quality treatment, and since the cost of treatment is a direct cost for them, they have strong financial incentives to reduce the cost per patient so that they can improve their profitability.
    • If we get most of the insurance companies to do this, then competitive pressures will ensure that this cycle is positively reinforced and the costs never escalate again.

These are exactly the measures that are not being taken but can go a long way in bringing healthcare costs down significantly& continue to do so in the long haul.

What do you think about this? Let me know by commenting below or by tweeting your thoughts to me at @rmukeshgupta.

Lessons in innovation from a retailer

Now let me ask you a very important question. Please think well and through before you answer this:

  1. What happens if you are forced to put an expiry date on every product or service that you create?
  2. What if you have to take the product or service off your price list at the end of the expiry date, irrespective of how well the product or service did business for you..

Now, if your business is like any other business that I know of, this is a scary thought.. Scary enough to start thinking about bankruptcy..

However, this is exactly what Zara has been doing for a while now and doing it really well. Designers turn out about 30000 designs that are productized every year. The time they take to introduce a product in the market from design is 3 weeks compared to the industry average of 6 months.

So, how will you change your approach to product or service design if you are mandated that any and all products/services that you create will have a date beyond which it will not be available for sale, which means that in order to stay in business, you need to have the next product or service already available before the existing product or service goes out of business.

This also means that you throw out the notion of “Cash cows” and “rising stars” if you know what I mean.

If I were in such a situation, my approach to running the business would be as below:

  1. Identify a target customer.
  2. Identify a challenge that they face and one that you could solve for them.
  3. Go about your research and find ways to solve it.
  4. Design a product or a service or a combination to solve it.
  5. Define a deadline by which the product or service will remain available for the customer to use.
  6. Handover the product or service to the delivery team who will sell and deliver it.
  7. Deliver the product or service to customers who want to consume this.

Somewhere in during step 3, you start step 1 again. So, that by the time you need a product or service, there is already a pipeline of ideas on what challenges do you want to solve and for which customers.

Everyone (including your customers) in the organization knows their role clearly.

  • The product design team needs to continuously keep looking to create new product opportunities by addressing specific challenges.
  • The marketing team knows exactly what challenge is being solved and for whom, hopefully which results in appropriate messaging.
  • The delivery (& sales) teams know that they have a very specific time window to sell, post which the product will no longer be available.
  • Customers know that if they want to address the challenge, they need to decide fast and adopt. The solution is no longer available for a future purchase, which results in no decision to buy a lot of times.

This could also be compared to the lean start-up methodology propagated by Eric Reis as well. Only difference, this could be adopted by large and small businesses alike.

This is also like heart beats, beating to a rhythm, regularly, one after the other.

Some products or services will work well, some will fail miserably and some will be average. That is not the point. The point is that you will focus on solving more and more challenges than on betting on one big idea, which if fails (and believe me a lot of them will fail) could be devastating to the business.

You just learn from the iteration and move on. Keeping the heart beating is critical.

This process also kicks out a lot of activities and throws them out of the business. Activities like

  • Business plan and approval process to get funding for a new product.
  • Forecasting process for expected sales.
  • Long term business planning at the start of the year (plans that will bite the dust with the first contact with the market).

This will also reduce the risk for your organization..

This enables your organization to outwit your competition to the extent that you will find that the only team that you are competing with is yourself.

Everyone else will try to play catch-up but will never be able to do that. Isn’t that a good position to be in?

Question is not if you think this is doable, question is do you have a choice?

Do let me know your thoughts by commenting below  or tweet your thoughts to me at @rmukeshgupta.



Leading a culture of Innovation

I came across this great video where Kevin & Jackie Freiberg talk about how to lead with a culture of innovation.

One thought that stands out for me from this video is one question:

What happens if we start a culture of planned obsolescence of all our products?

I think this one question will differentiate between companies that will thrive and those that will lose their way!

First, lets listen to what they have to say..

Now, I have tried to summarize what the Friebergs talk about below:

  • Innovation happens when you learn to “be comfortable being “uncomfortable””. This is the zone where you try to explore & surprise yourselves with what comes out of being in that state.
  • Innovation happens when, as a leader, you decide, commit & involve yourself to solve real world 
  • Deciding ideas to pursue using the following principles:
    • Is it real?
    • Can we win?
    • Is it worth doing?
  • Address the real problem, which means that you need to dig deep to find the real problem and not address the symptoms (greatly explained by the example of the British Railways).
  • The most important thing for innovation is “a culture obsessed with innovation”. Hopefully, you dont have people “who have quit but stayed”!
  • Create an environment where your employees get engaged and connected or “pockets of innovation”
  • Organizations who try to protect their markets typically end-up losing track as they are more interested in protecting their today against betting for tomorrow.
  • As organizations, be ready and willing to disrupt yourself. It is much better than being disrupted by some other organization.
  • Innovators find new opportunities in the confluence of “either” “or” mindset. Instead try using “and”.
  • What happens if we start a culture of “Planned obsolescence” just like in the food industry. Will that make us more innovative? Will that make us more open to ideas that could potentially disrupt your own organization or products.
  • Diversity is key..

What do you think about the concepts being shared by the Friebergs? Do you agree? What other things do you think are necessary in order to lead an organization with a culture of innovation.

Please share your thoughts as comments below or tweet me your thoughts @rmukeshgupta.