Appropriate Strategy By - Kamal Poddar & Sandeep Singh

In life there are no correct answers. There are only appropriate (suitable or proper in the circumstances) answers. Life is not about correctness, life is about appropriateness. So then what is the correct thing to do? There is no correct thing to do. What is the appropriate thing to do is the question. Life is essentially in its appropriateness. (Jaggi Vasudev)

Similarly in business there are no correct strategies. There are only appropriate strategies. Following are two examples demonstrating the appropriate strategy.

a. When Dabur launched Real juice in 1997, it was a new category not just for Dabur but for the nation itself and that too in a relatively new formatting packaging. Consumers' acceptance of a non-medicinal non - Ayurvedic juice from Dabur with almost no equity in foods was a big challenge. The solution arrived at by Dabur was very simple. They didn't highlight the company name alongside the Real brand name, which was the conventional practice at Dabur. Today not only it sales in 14 variants but is the most trusted juice brand in India. (Storm the Norm)

b. In 1998, Tata Tea had launched a brand for economy segment, branded as 'Agni'. By 2004, it was struggling to find a foothold. There was a discussion to close down the brand but economy segment was too large a segment to give up. In 2005, Agni was transitioned under the Tata Tea mother brand and it was rebranded Tata Tea Agni. Today Tata Tea Agni is the only successful national branded player in the economy segment. (Storm the Norm) There is nothing right or wrong in having company's name associated with the product. It might work in certain situation and it may not work in certain situation. One has to make an appropriate choice.

Peter Drucker observed, "The purpose of a company is to create customers." And one has to select an appropriate strategy to create customers. That is the dharma of a company. The strategies of different companies might look conflicting but in reality they are the appropriate strategy for them. Following is another set of example of strategies which are conflicting but both worked.

c. When Honda Motor Company (HMC) decided to make its mark as a two wheeler manufacturer in India after long partnership with Hero, it was on back foot due to a clause which barred it from launching any motorcycle for three years. This put well over 80 percent of the Indian two-wheeler market out of bounds for Honda. HMC decided to focus on automatic scooters, which was not a volume driver and had established player like Kinetic and Bajaj and launched Honda Activa in 2001. Today Honda Activa has sold more than 10 million units in India and has more than 50% market share in India in the segment of automatic scooters. (Storm The Norm)

d. In contrast to this, one of the world's biggest manufacturer of scooter Bajaj, stopped manufacturing scooter altogether in 2009 to focus on motorcycles.

Financial year 2014 saw Bajaj Auto Ltd. achieve its highest ever operating earnings before interest, tax, depreciation and amortisation (EBITDA), profit before tax (PBT) and profit after tax (PAT). Operating EBITDA increased by 7.8% to 4,305 crore. Profit before tax (PBT) grew by 8.6% to 4,632 crore. Profit after tax (PAT) grew by 6.6% to 3,243 crore.

It is obvious that there is no single strategy which can be called correct strategy but there is appropriate strategy. And it is obvious that to arrive at appropriate strategy organisations need to think without constraints, and should be willing to go against the trend.

But it doesn't mean opting for adharmic strategy in the disguise of being appropriate.

"So long as our conduct is in conformity with our essential nature, we are acting in the right way. Adharma is non-conformity to our nature." (S Radhakrishnan). Adharma causes conflicts and destruction both at the personal as well as the social and national levels.

Similarly adharmic strategy causes conflicts and destruction for the organisation. One can see it happening in case of IPL and Kingfisher.

That's why in India it is never labha (profit) but subha labha (auspicious profit); i.e. labha has to come by strategy which is dharmic or appropriate and not by adharmic strategy or inappropriate strategy.

Kamal Poddar, MD & CEO, Choice International & Sandeep Singh, Founder www.swastik.net.in