Learnings from a Marwari Business Family…
Learning’s from a Marwari business family-
For Startups and Family Business Entrepreneurs
After graduating from B-School and having learnt all the Porter’s Model and trick of trades for running business, I was all excited to join my family business as I was eager to implement my leanings in real time. I made my business models and algorithms for processes to be implemented in my company.
As I joined, everything turned topsy-turvy! My staff looked at me as if I am a dumb alien creature! My plans and ideas were listened as I was cracking CID or Rajini jokes. The only person looking at me with high hopes was my Father but more I saw hopes in his eyes the more I was getting suffocated as I had no clue what to do and from where to start! I can’t just simply go to him and say: Dad, its not working! That’s like being a loser. What ever I planned and implemented on floor was scrapped next day. All my motivation and excitement just simply went for a Whirlpool ride in an endless ocean.
And that is how I got inaugurated to the leanings of Marwari B-School. In MNCs they call it an Induction and Training where you will learn only your job profile but as an Entrepreneur you have to wear several hats in a day, from a CEO to Electrician. My first and biggest lesson in Marwari family business was to be flexible with work profile and be ready to get my hands dirty. Which I guess is important for entrepreneurs to learn and understand in this flamboyant era of entrepreneurship.
For centuries, Marwari’s have been known for their financial practices. You might require software to make a balance sheet but a Marwari can do it in 3×4 Inch of paper! Trust me, they can.
The day I started in business, I was told 100 times that Debt is bad! It’s an evil.
In general an incorporated company has a life span of 30 years (Max) but see the family businesses in India, they have been running for more than 60 years. From small to big, one thing is common either No debt or Balanced Debt.
It is important for an entrepreneur to understand that unbalanced and over optimistic debt can kill your dreams overnight. I am not saying that debt is bad, To grow at a particular level, debt is required but grow slow and calculated for a sustained living for you and your company.Simply to put, before talking about making billion dollars at-least make a million.
Gripping your financial decisions is very important. Every rupee saved is rupee earned. Hit hard on negotiating prices with your suppliers no matter how small is the amount. As entrepreneurs, we don’t give much importance to small purchases but it helps you cut your overheads and thus brings financial discipline in your employees too.
Managing employees seems to be a very difficult task. If it’s an MNC or a small business, it’s difficult. What I learnt from Marwari family B-school is that treat your employees as if they are a part of family. Understand their personal problems and remember their names, It makes them feel special but do remember to draw a line and respect that. After all they are your employees. As entrepreneurs we often tend to restrict our staff to certain job but personally I think that it’s not right. Freedom of thought, freedom of creativity and freedom of articulation- is what they deserve. Let them work as entrepreneurs and not as mere robots. When I joined the business, none of my employees used to respect me and it’s fair from their end as I have not done anything for them. Gradually I spent my days in shop floor and spoke to everyone, be it a labor or a staff. They had problems with some processes, which they told me and were afraid to disclose it to the constructor of the business- My Father. I did take their feedback associated with the problems faced by them seriously and did the best for them. That’s how I started growing the root of my respect within the company from the people of the company. They gained faith in me as they got, what they wanted- a Vigilant in me.
“Knowledge is power”- a very old saying but still a startling fact useful in any grounds of business be it securing employees belief or be it convincing clients. When your people know that you are very well aware of what’s happening in the company and about the future roadmap, they will look at you with tons of hope spiced with respect.
During the great Economic turmoil where the Western markets had to experience with the Horrifying Recessions- leading to national outrages worldwide because MNCs were FIRING as to cut overheads. If you have to learn how to cut overheads, simply walk into a Marwari’s office. From interiors to staple pins you will find a cost cut. It takes years of planning for a Marwari businessman to install an Air Conditioner in his office and with all the planning the calculations of power consumption no matter how small or medium scale Enterprise it is has been done erstwhile the installation. What makes a Marwari go through such a long process of thought before installing an AC? He thinks, can I buy a machinery for 30 Grand’s which can give an output and ROI! It’s been 35 years to my business and I don’t have an air conditioned office but surely my machines are adding!
This is an important lesson for an entrepreneur as to put company before self. After all it’s your Respect, it’s your Existence and it’s your Identity.
MNCs often end up with over hiring employees and then during downfall, many lose their jobs, hopes and most importantly dreams. What I learnt from a Marwari business is to take 200% from your employees. My car driver drives for 4 kms. a day and does the entire bank, insurance, postal jobs and small purchases. The guard sitting inside the plant is packing goods, the labour loading the goods is trained with computerized weighing machines. While doing multiple jobs the employees get more connected to the system and working of the company and their loyalty increases. There exists a special bond between the Owner and employees (bottom and Top line) They start treating their ‘Babuji’ (Owner) as their god. They know it, if they have noone, their ‘babuji’ is with them. Maybe that is why in Marwari SMEs you can find employees working for 40 years!
As startups and SMEs, when you can’t afford to give high packages, you have to hire right resource! You require the right attitude and not much of an aptitude in your employees.
Savings and Future Planning:
It is rightly said, a Marwari spends only either on education of his/her child or wedding. What may seem a thousand buck to people, a Marwari sees its time value of money! Not often you can find a Marwari living on a credit card, they take it against their pride. They can skip butter from their meals but not make a living on credit. As a B-School grad, I must say that buying from credit card is cheaper than paying upfront cash but that’s what Marwari’s are known for, financial discipline.
For centuries, Marwari’s have been saving for their kids’ education, wedding etc which is now legally called as ‘Trust’. Even in bad times of business, a Marwari can do a lavish wedding for his kids or can send him abroad for education. The root of such a practice lies in considering your bank’s savings account as piggy bank. For every extra rupee earned, he might skip shopping or a Vegas trip for once but will save it for his family’s future but yes, he will surely shop and make a Vegas trip with extra 2 rupees earned!
Now a days, life styles have changed if you have a rupee extra you will shop for brand X and if 2 rupees extra, for brand Y and the maze goes on.
For Entrepreneurs, understanding yourself within is important. Consider your future plans and savings before switching from brand X to Y.
Client Relationship & Market Establishment:
Sitting next to my father in office, I have seen many customers visiting and one thing that I learnt was how to engage and bond with your customer. As said, the work culture is more like a family for some customer of young age, my father would say ‘Beta’ and for them, he is their ‘Chachaji’ ! The trust between them is so much that they do not need POs (Purchase Orders) to place an order. Its done on a call of 20 seconds no matter the size of order. In Marwari they call it ‘Awaaz’
Talking about this, I do not intend to say that make everyone your beta or chacha as we live in a global economy but what can be understood is, loop your customers. Talk to them about them more than what you need. I can assure if you are in price competitive market and you are able to loop your customer well, he will think twice, thrice, 100 times before buying from someone else.
To get yourself established in market, you have to be straightforward and very honest. You should have the DARE to say NO! if you cant fulfill the order in a given timeline. These small things add up for your future portfolio. If you are growing, your company too is growing.
The financial discipline not only includes, how you save and spend money it includes how you give money to your vendors. To be a known and respectable figure in market, pay your suppliers on or before time. Never commit a false promise, as you never know he might have promised someone relying on you.
If your payments are on time, you have an upper hand in negotiating with him for the next order. Beg, borrow, steal but make payments on time is what I have learnt and adopted and seen the change in myself. It makes a big difference.
So, a B-School or Marwari B-School?
Simple living and High thinking! That’s what I have learnt after the mixed experiences of studying in a prestigious B-School and experience from Marwari family business. The learning’s from a B-School have made me presentable and analytical. It has also helped tremendously in developing a perspective about business operations and management practices, whereas in Marwari family Business, I have learnt to be connected with grass root and developing an ethical approach for a sustaining business which I personally think is needed in today’s young entrepreneurs.