Sunday, November 09, 2008

Notes from TiE-ISBConnect - Prof K Ramachandran, ISB

Professor K Ramachandran is the Associate Dean of Academic Programmes at the Indian School of Business. He has been a professor of entrepreneurship, family business, and strategy at the Indian School of Business, Hyderabad since its inception in 2001. He is also the Thomas Schmidheiny Fellow of Family Business and Wealth Management at the ISB.

Professor Ramachandran spoke about Entrepreneurial opportunities and Organization Building - A Road Map. He spoke about identifying the type of opportunity, the graph of time against turnover for a startup and elements of a business plan.

Opportunities are identified through a pent up need or customer dissatisfaction in the existing offerings. By mapping the pent up need (Discontentment) on one axis and Criticality (dissatisfaction) on the other different kinds of opportunites can be identified.
Any organization needs to balance Financial Needs, Technology Needs, Marketing Needs and Entrepreneurial Capability. If an entrepreneur can manage the four of these then his organization will be a shining diamond.
By mapping the turnover of the organization over time one can get the graph as shown below
The key to being successful is to reduce the time from the organization is started till it starts to show a profit and many successful organizations reduce this time to be very short. This curve is never smooth and there are bumps as the organization grows especially when work is delegated and decisions are decentralized.

Business plans force dicipline and it is always good to write a business plan oneself and this task should not be delegated. One needs to keep revisiting and updating their business plan. Need to make a 3-5 year business plan. Don't underestimate working capital and it is important to keep working capital low.

Elements of a Business Plan
  1. Executive Summary - Clean, Completing and Concise
  2. Product or Service Description - Explain how it will continously provide value
  3. Management Team - Capability and Company Description. It is important to have a good advisory team. A good board of advisors help in attracting customers and investment.
  4. Market and Competition - Clear understanding of customer needs should be showcased. Good to talk about future competition too.

    FeatureCompetitor 1Competitor 2...You
    Feature********
  5. Marketing and Sales
  6. Technology and Operations
  7. Implementation Schedule
  8. Managing Risks
  9. Financial Planning
  10. Exit and Growth
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