cults or communities

Vinay Kamat

In the age of interactivity, will brand cults dissolve into communities? Will fanaticism morph into romance? Will consumers be swayed less by brand myth and more by brand awareness? As brands become transparent in the online world, will cult be shorn of mystique?

After all, brands are learning to live with online communities. They are not averse to being criticised by bloggers; they even pick marketing and user insights from them. Here’s what Microsoft's own blogger Robert Scoble posted on March 14. “Microsoft is a consensus culture and consensus (which means everyone has to sign off on things) does avoid trouble, but it also makes for uninspired products and marketing. That is our internal challenge to figure out, that's for sure!”

Why are brands willing to go the extra mile to reveal themselves to their communities? It makes them transparent; it provides an opportunity for users to interact with the brand and offer useful feedback; it develops tons of trust; and it makes the brand highly accessible. In the interactive world, brands cannot afford to be inaccessible.

Openness creates communities; mystique creates cults. Importantly, brand cults are driven by symbolism and ideology. Brand communities are driven by interactivity and transparency.

Here's why brands become cults. "Brands are symbols. We live in a world dominated by commercial icons, total design initiatives, and completely integrated marketing efforts, where products are consumed less for what they are (materially) and more for what they represent (spiritually, or at least socially)," writes Douglas Atkin, in The Culting of Brands, a solid account of customer loyalty.

As customers group themselves into communities, they seek solutions, not symbols. They seek convenience, not sophistication. They desire performance, not promise. Communities don’t just create a feeling of belonging. They ensure that the brand belongs to them.

“Customers ultimately determine what your brand means,” says marketing expert Guy Kawasaki in his blog: "For decades Apple has tried to make the Macintosh brand stand for power. For decades consumers believe the Macintosh brand stands for easy to use. Ultimately, you flow with what's going, and you’ll be thankful that it's flowing at all."

So, have Google and eBay formed cults or communities? By constantly interacting with users, they have created tribes which are not swayed by myth, mystery and mystique, but by the brand attribute of convenience. It is a lifestyle of cutting-edge simplicity. It is a community of critics, not a cult of worshippers.

romancing money

Vinay kamat

Risk is the biggest differentiator. Take it, and you separate yourself from the crowd. If that doesn’t tickle you, just think: If the economy is beaming, salaries are galloping, and jobs are exploding, what should you do? How do you sense change and pocket it? How do you junk conventional thinking and position yourself for the next big leap? How do you power your career? How do you hitch your wagon to India’s growth engine?

Look around. Your friend has trebled his salary in one year by jumping jobs. Your ex-colleague can’t stop talking about her SUV, the first piece of prosperity she gifted herself on becoming a veep. Your cousin, who runs a VC-funded startup, has bought chunks of real estate across the country. Everyday, you read about IIM freshers setting salary benchmarks. In this cat race, would you like to be a bystander or a marathon man?

More than stamina, you need insight. If you map the change around you, you will see something profound: Even as you are battling IIT freshers in the workplace, your job is rapidly turning obsolete. Two years ago, you could have hung in—even performed—by reinventing yourself. Now, you need to jump on another bandwagon: wealth-creation. It is the mumbo-jumbo of material salvation.

Perhaps the best paperback to carry around these days is a 1997 book that pops frequently on bestseller lists: Rich Dad Poor Dad. Its racy plot lies in the sub-title: What The Rich Teach Their Kids About Money—That The Poor And Middle Class Do Not. If you present you daughter with Rich Dad on her 11th birthday instead of Pride and Prejudice, don’t feel guilty. This is the age of wealth- creation, where hyper mobility, obscene sign-on bonuses, and lavish penthouses, are signs that you have arrived. And, if greed is ethical, why not pay for it through EMIs?

Rich Dad’s author Robert Kiyosaki has a portfolio of tips for the uninitiated. The controversial financial bible can be reconstructed into a few commandments:

1.Focus on assets, not income.
2.Understand accounting, investing, marketing, and law.
3.Master communicating skills.
4.Don’t fear risk.
5.Remember: you are one skill away from success. Find out which.
6.Employ money

Well, you need to read the book to put the canons in perspective. You may even come up with an alternative title: How To Romance Money.

Next time you hear about an executive who has chucked her job at 33, don’t dismiss it. It is the surest sign that India’s middle class is moving into asset class. Interestingly, filthy rich dads may call it rational exuberance.

fun and turf

Vinay Kamat

Will tomorrow's organizations be bothered too much about culture? After all, culture, as we know it, is linked to hierarchy, process, brand image, strategy, and most importantly, history. But these goal-posts are being constantly shifted in a fast-changing marketplace. In fact, by default, process is becoming culture in today's organization.

But, gradually, process will shrink as firms outsource sub-processes to suppliers. Culture, then, will be a set of shared values. John Micklethwait and Adrian Woolridge argue in The Company that the "dicrete" company could well be replaced by the "network" or the "boundaryless firms of Silicon Valley". These could be an ecosystem of individual entrepreneurs or organizations turning fractal by creating internal entrepreneurs.

Even as the reorganization of the organisation is under way, how do companies prevent themselves from being cultural clones? Indeed, how do they retain their cultural buoyancy and exclusivity despite living on the edge? How do they become cultural enclaves first and profit centres afterwards?

In a piece on Google (June 2004, www.cioinsight.com) management expert Warren Bennis outlined the challenge of creativity: "Even obsessed geniuses burn out. Once the bomb is built, or the PC is invented, the members of the group suddenly realize that they have been working 20-hour days for a long time, and they can't remember the last time they petted the dog or ate a meal with their children. Suddenly, work that seemed like play isn't fun anymore."

Still, despite being in a domain where the business model must always be flexible, Google may have just got its cultural algorithm right.

Who's the typical Googler? What makes her tick? You can get the answers to those questions on Google's site. "Googlers range from former neurosurgeons, CEOs, and US puzzle champions to alligator wrestlers and former-Marines. No matter what their backgrounds Googlers make for interesting cube mates."

"Google engineers all have 20 percent time in which they're free to pursue projects they're passionate about. This freedom has already produced Google News, Google Suggest, AdSense for Content, and Orkut – products which might otherwise have taken an entire start-up to launch."

What Google has done is simple: it has created virtual organizations and individualized corporations within. It has wired itself for tomorrow's necessities. It's a future that Tom Peters has been reminding us: "Buildings are tumbling. Boundaries are vanishing. Temps…are coming. Where 'you' start and where 'I' stop are no longer clear. Where 'I' stop and where 'you' start are no longer clear. How far will it go? Very far."

Yet organizations like Google may have found an answer by creating a fun atmosphere in the workplace. "Forget turfs. Think of people innovating across functions--and delivering. That's Google," says Google's Ashish Kashyap, country head, India sales and operations.

Fun knows no turf. It requires no buy-in. It is a feeling that is equated with quality of life. Just imagine discovering fun where you least expect it: the shopfloor. For the corporation, it is the only way to pre-empt the boundaryless organization.

hair and fire

vinay kamat


Here’s a true Sunday entertainer—a book straight from the copywriter’s desk. It tells you which soundbites sell, why insights score over ideas, and how to pitch an idea at GE’s Jack Welch, FedEx’s Fred Smith and Pepsi’s Roger Enrico. Phil Dusenberry’s book is an ad zapper: you will look at the world of advertising afresh.

Don’t be misled by the title, though: Then We Set His Hair On Fire. Nothing punk about it. The title comes from a Pepsi ad shoot done by ad agency BBDO featuring Michael Jackson. “Michael’s hair caught on fire from an exploding special-effects fireworks tower at the edge of the stage. It was a fluke, an errant leaping flame that somehow covered enough stage space to attach to Michael’s hair.” Needless to say, the accident—and the commercial—became a phenomenon. And a title.

Dusenberry’s take on advertising—a domain he bestrode as BDO North America’s chairman and chief creative officer—is like an ‘errant leaping flame’ in today’s world of search-driven text ads and viral marketing. His creative epiphanies hardly make sense to a generation that hates to listen; they may be even out of tune in a world of comparison shopping. But his is a world that creatively triggered romance between the consumer and the brand.

That romance is now called relationship. Cupid has changed, too. Gone is the copy writer. Instead, you have a one-on-one relationship blossoming in cyberspace between the user and the brand.

Dusenberry’s book centres around insights that created brands. Like GE’s famous one-liner, We bring good things to life, which was born in a cab as DBDO’s creative team “honked, bounced, and stalled our way through traffic.” Then came Pepsi’s The choice of a new generation, a super-phrase that was coined 20 minutes before presentation.

The best part in the book is Dusenberry’s belief in insights: “In the advertising world, a good idea can inspire a great commercial. But a good insight can fuel a thousand ideas, a thousand commercials…At the risk of overstating the value of We bring the good things to life, I would argue that it was more than just effective advertising slogan. It also explained the fundamental rationale for (Jack) Welch’s company: every business GE goes into must provide a benefit to some consumer constituency, must make people’s lives better.”

But where does Dusenberry’s ‘insight moment’ fall? Does it fall between innovation and execution? Can it be applied to other wings of business or other organizations? Does it qualify as an out-of-box thought? Is it the answer to creative advertising’s ills?

Here’s the last word from Dusenberry, on ‘insight moment’: “The moment you hear it, you can’t see the world in any other way.” That is good old creativity reminding you that it is still around. You may need a Sunday and Dusenberry’s book to realize that.

delight is discipline

Vinay Kamat

Customer satisfaction comes in many names and forms. Some call it romance, some think it is delight, some equate it with value-creation. Very often, questions are raised about delight—which is a step above (customer) satisfaction. Is there a level above delight? Has anyone reached there?

Most books on customer satisfaction suffer from a 'purple cow' syndrome. The term, coined by marketing maven Seth Godin, refers to something remarkable, something awesome, that you come across in what is otherwise a boring world. So, is there a 'purple cow' in the black, white or brown world of customer satisfaction?

Yes, there is. Written in 1995, The Discipline of Market Leaders still survives as a purple cow in the brown world of customer satisfaction. Here, authors Michael Treacy and Fred Wiersema show us through case studies how firms rule the market by creating a customer discipline inside and outside the organisation. Put simply, they talk about three value disciplines: operational excellence, product leadership, and customer intimacy.

Operational excellence is about continuous improvement; product leadership is about positioning; customer intimacy is about bonds. This disciplined approach helps firms to institutionalise spontaneous interactions with customers. It tells CEOs how and why to empower the last mile—the people that constantly interact with the customer.

To explain spontaneity and empowerment Treacy and Wiserama fish out a Home Depot anecdote, which centres around founder Bernie Marcus. In the back-office of one of his stores, Bernie "noticed a Sears Craftsman wrench lying in a pile of items that customers had returned. Marcus called the store's customer-service people together, held up the wrench, and asked who had accepted it as a return, since Home Depot doesn't sell Sears wrenches. One employee admitted guilt, whereupon Marcus broke into a grin. This was a great example, he said, of someone taking responsibility for doing the unorthodox to please a customer."

The example provokes one key question: How do you suffuse your organisation with an 'unorthodox' spirit? You don't, you just create the right value disciplines throughout the organisation that focus on product quality, customer focus, and brand positioning.

Such a culture will automatically empower last-mile employees to satisfy the customer in out-of-box ways to create delight, delight and more delight. But before that happens, firms must set up route-maps for delivering superior customer value. It is a simple process that Treacy and Wiersema narrate so delightfully.

why you need a brand manager

Vinay Kamat

“Just do it”, said a sneaker, and became a super-brand. I would say something similar to the knowledge workers out there innovating 24/365 to crack the brass-ceiling of hierarchy. I am sure if a TV channel launches Kaun Banega VP, even BPOs will stop humming. Every one wants to rise in the organization but nobody has been able to explain how, satisfactorily.

So, if you want to shine in 2006, all you need to do is to get yourself a brand consultant or a Velcro Manager (VM) who sticks by you through thick and thin. Once you have one, you need someone else to fill up the brand management team: you need an office spouse.

Office life is getting harder. Just make a list of what your boss expects of you: month-on-month leaps in revenues; quick rollout of Six Sigma in obscure places like canteens; fluency in Chinese, in just six months; understanding of Google’s algorithm to ensure your company can be in the top 3 search results; idea of Taimur Lang’s out-of-box military tactics; ability to discuss Kate Moss’s reinvention in the board-room and apply it to some of your own dying brands; working knowledge of ancient Indian nuptials to impress your joint venture partners; Deepak Chopra’s wellness mantras …The list is bottomless. If you look like a monk hit by a Ferrari, it’s natural; all execs feel so at the end of the week.

Believe me, 2006 will not be the Year of the Organization Man. It’ll be the Year of the Renaissance Man! The concept is catching on in other fields too. “I'm Michelangelo, and you're my Sistine Chapel,” says Will Smith, playing a date doctor, to his client in the movie Hitch.

So, who’s your Velcro Manger—your own Michelangelo? If the idea of having a brand manager still hasn’t sunk in, here are some pre-dinner apperitifs:

1. Your flattest organization has just two layers: brands and commodities. So, the upward rise is tougher and longer. Climbing Mt Everest without O2 is easier.

2. People have personal yogis to manicure minds and personal soothsayers to show the futures. But none of them can offer you the ultimate career recipe. You require a brand druid to brew your future.

3. You can make an impression on your boss only in increments. He may like a PowerPoint presentation on market dominance with King Kong backgrounds since he’s a movie-freak. Or he may like the sound of verbs like “tee off” because he’s a habitue of the greens.

4. You may create a Sistine Chapel in the organization but unless somebody creates a blog-type buzz around it, it may turn out to be a Christmas decoration.

5. You may suddenly realize that standing-up-for-others isn’t a virtue anymore. Maybe, you need a brand-manager to tell you the PUTs (plain urban truths) of corporate life.

6. You may need to develop a mental algorithm which tells you when to keep a high profile and when to sound dumb? Bosses love human failings; they hate flawless threats.

7. Bosses don’t wipe their slates. So a mistake in 1995, when you first joined the organization, may figure in your 360-degree performance appraisal in 2006.

8. Multi-tasking is a test. Bosses spring it on you to gauge your maturity. It only works at home; in office, it makes you look like a hands-off baby-sitter.

If you think these questions have provoked the commodity in you, then start looking for a VM. Typically, potential VMs are natural game-theorists and can provide multiple outcomes. They are brand-killers, since their idea of pushing you is based on pulling down somebody.

But even as you get a VM, search for an OS as well. They are inseparable. Nowadays, it’s fashionable to have an OS, or office spouse. It’s another window to your future. You don’t need to have an affair to have an office spouse, you just need to exchange sympathies. After all, the modern office is like a cutting-edge trench in which you relentlessly duck to perform. When the tasks are too much to handle, you need an emotional reboot. You need your dear office spouse.

As 2006 gets going, remember blue ice. It means you could be knocked out when you least expect it. So, start a blog and find your own VM and OS if you don’t have the courage to find them in person. Alternately, find an OS and let her help you find a VM. And please create a relationship, not an affair.

In short, in 2006, think like a brand. Don’t ogle like a commodity.

[First printed in Outlook's 2005 yearend issue]

multiducking

Vinay Kamat

A month from now you could be sitting in front of your boss trying to answer that tricky question. "Well, tell me, how well have you multitasked?" Your performance appraisal would depend upon how effectively you have applied the multi logic to work.

Have you, for instance, mentored subordinates, upheld organizational values, listened to 100 customers on average every month, suggested 10 business ideas during the year, helped hire talented people, met delivery schedules every time, doubled team productivity, suggested smarter ways of production, and remained virtually connected to your boss when not in office? And, do you promptly answer 400-odd emails a day and read enough books and journals to maintain your cutting-edge?

Before you protest, let us accept multitasking as a given in an economy where multi is the norm: multiplex, multinational, multimedia, multigaming…

Plain words like task, chore, assignment, stint, project, undertaking and duty have all begun to resemble multitasking. Naturally, the Dept. of HR revolves around one performance criterion and measures you accordingly. Shorn of Excel and Word formats, a typical HR performance review form would encompass the following:

1. How many tasks can you perform at a time?
2. Will you have the RAM to add two more tasks?
3. Do you compromise organizational values when you multitask?
4. How many multitaskers do you have in your team?
5. Have you been able to save cost by multitasking?
6. Are you able to implement a project end-to-end? Give examples.
7. Can you resolve all HR issues yourself?
8. Have you declined any task because of lack of time?

US researchers Joshua Rubinstein, David Meyer and Jeffrey Evans, who investigated the new corporate phenomenon, point out that "subjects lost time when they had to switch from one task to another, and time costs increased with the complexity of the tasks." So much for productivity.

How about an alternative? Management consultant Lisa Haneberg suggests the idea of "multichunking" in her blog: "Chunking means carving out blocks of time to work one task, project, or activity. The blocks should be at least one hour long and you should get in several two-hour chunks per week."

Despite its flaws, multitasking just can't be wished away. It will keep figuring in job interviews and performance appraisals until someone comes up with a better idea of performing. Nobody will. For, multitasking allows bosses to shift goal-posts. Its ambiguity attracts HR managers.

For all its complexity, multitasking develops one dominant trait, or skill, in an individual. Other traits, then, become accessories. In the case of Alexander the Great, his "connective style" defined his personality. Says Partha Bose, in Alexander the Great's Art of Strategy: "Before any battle he would ride up and down the front, speak to his men directly, call out to familiar faces by name, and remind them of previous acts of bravery." It was a simple gesture , not a process called multitasking.

intimacy & hijack

vinay kamat

Man is a hyper-interactive animal and the net is his preferred medium. Well, if that is what the world is coming to, marketers must rethink the battles for customers’ minds.

Good old marketing was a process driven by positioning. Sharper the focus, cooler the message, and greater the hype, the better were the chances of success. But as brands crowded minds and markets, clarity and simplicity became the buzzwords. Significantly, informality brought marketers closer to customers.

John Grant defined the mood in The New Marketing Manifesto: “It is time for marketers to get off their pedestals and get closer to the real world. You can think of it as a kind of marketing informality, a bit like Casual Friday.” One of the examples Grant highlighted was Pizza Express which set up its kitchen amidst customers, showing them their pizzas were all hand-made. That was how close the brand got to its customers.

Even today, the king of all marketers, Procter & Gamble, relies on the experiential. As Jim Stengel, head of marketing, P&G, told Financial Times recently: “You have to be experiential. And some of our best ideas are coming from people getting out there and experiencing and listening.” Little wonder then that Stengel is not hot on focus groups.

While the net has turned brand management into interactivity—where usage creates buzz—it has also given the customer a big say in defining brand persona. Hotmail, Napster, and Google are creations of the online community. True, they were engineered by codies, but they became what they are after numerous one-on-one interactions, user tips, and word-of-mouth marketing.

Customer proximity is passé. Customer involvement is the new thing. In the open-source era, it invites users to engineer the product by rewriting the code, partly or wholly. The idea of new-age marketing is simple: let the user create the brand. After all, the networked consumer, the netizen, is as savvy as the marketer. She dislikes aggressive push strategies, preferring to be drawn to the brand instead. She prefers informality to formality. And she likes the relationship to keep evolving.

Alex Wipperfurth’s Brand Hijack maps this changing brand universe in a provocative statement: Let the market hijack your brand. As he explains: “Marketing managers aren’t in charge anymore. Consumers are. Across the globe, millions of insightful, passionate and creative people are helping optimize and endorse breakthrough products and services—sometimes without the companies’ buy-in.”

For consumers, it’s not just a buy-in. It’s a live-in which strengthens the relationship between the product and the user. It’s not loyalty. For, loyalty is a lock-in. In live-in, you are not bound by a brand’s values. You chose the relationship, you architect it, and you keep evolving. In the structured world of brands, such unfettered, informal, relationships work.

For marketers, it is the best way of knowing whether a brand can survive intimacy or interactivity. It is perhaps the only way.

toughest P

Vinay Kamat

It is the toughest P of marketing. It is the ultimate positioning statement. Marketers are still grappling with this P in internet space. For, Pricing is not about numbers alone. It is strategy.

“Too often, however, greed gets confused with positioning thinking,” say Al Ries and Jack Trout, in their best-selling book Positioning. Where you perch the product in the customer’s mind through ads is critical. It sets the price point. It creates the value proposition.

But how do you establish a price-point when comparison shopping—using powerful search engines to scour the net for best prices—is gradually becoming the norm? How do you showcase value when brands are turning into utilities in cyberspace? How do you compete in a space where buyers set the price and sellers bid?

Forget new economy. Pricing just lacks innovation. Says marketing guru Philip Kotler: “Many companies do not handle pricing very well…Pricing is too cost-oriented; price is not revised often to capitalize on market changes; price is set independent of the rest of the marketing mix…and price is not varied enough for different product items.”

Who said pricing was easy? Yet Rafi Mohammed has come with competent answers in his recent book, The Art of Pricing. The sub-title has a tear-your-hair effect: How To Find The Hidden Profits To Grow Your Business. It simply means profit lurks in very nook and corner of your office. A net price increase of 1 per cent, for instance, could translate on average into an 11% rise in operating profit.

As the book underlines, pricing is not about number-juggling alone. It is about creating team spirit, as Ford Motors realized. When it shared its pricing information with dealers, they realized what models to push. They started focusing on higher-margin cars, raking in bigger profits for the company.

Pricing helps companies to build ecosytems around brands as well. Sony resisted the temptation to increase the price of its gaming console, PlayStation 2, when it was launched in 2000. Sony’s retail tab was $299 when auction sites were hawking it for $950, writes Mohammed. While Sony’s pricing strategy hinged on market creation, technology adoption, and media hype, the company was keen on creating a gaming ecosystem, comprising consoles, games, and message boards.

If anything, pricing helped create a culture called PlayStation.

Perhaps the best quote in Mohammed’s book is from Sun Microsystems CEO Scott McNealy, which first appeared in Fortune magazine: “In the whole history of Sun, we have never known what demand is, what elasticities are, or what the ‘right’ prices are for our equipment.”

It shows why pricing is not just a process but an art and a strategy. Indeed, it is a short-code for positioning. And those that are not clear about their positioning miss the point—and the price.

customer's dilemma

Vinay kamat

Can innovation sell? In the dotcom era, the idea was christened the next big thing and oversold. It explained the power of the idea but failed to explain the boring part: how to move things from Points A to Z. While A represented imagination, Z was all about execution. When dotcoms went bust, innovation became suspect.

What was once a motivation tool for generals, and an intrinsic part of their strategic vocabulary, became a worn-out cliché nobody was prepared to buy. Innovation had not only become a generic word, it was no longer fashionable.

How stale is innovation? We may have to come up with some other expression for breakthrough transformation, says Vijay Govindarajan, author of 10 Rules For Strategic Innovation. Sometimes it can be entrepreneurial and out of the box—
just like the last 15 minutes in Tamil films.

Typically, as Govindarajan points out, this is the most exciting part of the film. The heroine gets kidnapped in a Merc by the villains. But her rescuer, the hero, uses a horse to outrun the powerful car. He rides down the hill, across fields, and through other hurdles, to win the day. “If that isn’t an innovative solution, what is?”

The horse versus Merc anecdote describes the odds that innovators have to battle against, which is amply visible in India’s entrepreneurial success. But without the choreography of execution, innovation can’t budge, let alone gallop.

In his well-researched book, Govindarajan details what comes between an idea and execution. Tomorrow’s businesses must forget, borrow, and learn. They must forget, or discard, templates that create success for the parent; they must borrow best practices and assets from the parent; and they must learn to create their own templates of success, improving with every step.

It’s really the last step that drives innovation in the organization. But for all his emphasis on execution, Govindarajan is a firm believer in the revitalizing role of innovation. An organization that creates a startup culture within, by taking the forget-borrow-learn path, prolongs its life. “And I’m all for increasing the longevity of organizations. The loss of an organization is the loss of knowledge, talent, and jobs. It’s huge.”

Of course, there are cases where independent startups have sounded the death-knell for organizations. Take Google which did not have any parent to inspire or bankroll it. Or Yahoo, which created a crowd of followers with its content aggregation model. Does the future then lie outside the organization, where upstarts like Google keep prowling and scoring hits?

It all depends on a firm’s ability to sense the birth of a new market. It hinges on the speed at which it breaks the tyranny of customer satisfaction. After all, customer satisfaction is the emotional connect with the loyal customer. Firms that keep satisfying her ought to win. But what if the loyal customer is not a savvy customer? What if she is not able to sense change and demand tomorrow’s products from the firm?

Such customers can disrupt a well-established player, as Clayton Christensen documents so well in The Innovators’ Dilemma. For organizations venturing into the digital era, it’s really a question of what, and how many, customers to forget.
It also depends on whether innovation is bred within the organization, on its periphery, or outside, in a skunk works.

Until that is decided, least expected competitors like Google and eBay will challenge the organization. And hasten its demise.

business of paranoids

The 1990s were the best years of management. Re-engineering, Six Sigma, Core Competence, the Customerised Corporation, Mass Customisation, and a host of other ideas dominated the era. Michael Porter, C K Prahalad, Gary Hamel, Michael Hammer, Jack Welch, Tom Peters, among others, defined the rules of contest.

Despite the proliferation of ideas, one unusual writer-he was a practitioner like Welch-stood out. The odd guy: Intel’s Andy Grove.His book was a guide to deal with inflection points: dramatic changes in the rules of business. Inflection points could vapourise companies. What caught the fancy of the management world was the book’s title: Only The Paranoid Survive.

If the purpose of companies was happiness — customer happiness, that is — companies had to reflect that mood inside as well. How could paranoid workers create delighted customers?Well, Grove wasn’t just defining the aggressive mood of the 1990s-a decade where IBM was being pushed into the pit, Microsoft was acquiring pole position, and Intel was overtaking, or reinventing, itself. He was talking about the future, where upstarts could hobble giants.

To understand ‘paranoia’, just look at Google and Sony. One has changed the rules of competition; the other, once a byword for innovation, is playing catch-up.Grove, Intel’s then CEO, was forthright and intuitive even as he was explaining his book’s unusual title: “Business success contains the seeds of its own destruction.The more successful you are, the more people want a chunk of your business and then another chunk and then another until there is nothing left… the prime responsibility of a manager is to guard constantly against other people’s attacks and to inculcate this guardian attitude in the people under his or her management.”

Grove’s title has resonance even today. For, paranoia has two aspects. First, never tire of watching competition. Second, paranoia leads to innovation.Steve Bennett, CEO of accounting software major Intuit, gave an idea of the first aspect when he told USA Today recently: “It’s better to be paranoid and focus on doing everything you can to eat someone else’s lunch rather than being the person who gets their lunch eaten.”

Ravi Kant, managing director of Tata Motors, dwelt recently on paranoia’s second aspect at the Mumbai launch of strategy guru Vijay Govindarajan’s book, Ten Rules for Strategic Innovators. Great organisations, he said, require a crisis to think anew. He was talking about the Rs 500 crore loss his company incurred a few years ago and how it jumped back into the black by improving processes and creating new local and global markets.A crisis helped the organisation to reinvent itself.

So, as Kant put it, organisations (do) need to create a sense of crisis to manage the future better. In a sense, he was echoing the message of paranoia. As Grove wrote in 1996: “Most companies don’t die because they are wrong; most die because they don’t commit themselves.”Indeed, it wouldn’t be wrong today to say “only the paranoid win.”

For, paranoia is a state of mind that senses change and welcomes it. It makes innovation possible by focusing the mind.