Prem Kumar, CEO, Meridian Telecom, is an experienced CEO and Entrepreneur with over 27years of outstanding track record. He has moved from being President of a large MNC to being a successful entrepreneur who has turned companies around, created value, and developed and executed profitable growth strategies across industries and geographies. He is an exceptional strategic thinker with pragmatic analytical skills and solid business and commercial acumen and strongly focused on driving best in class Execution.
Meridian Mobile as a premier handset manufacturing company has in a short span of time established Fly Mobile’s presence in 25 European and Asian countries including India. Fly Mobile, one of the leading mobile phone brands and the pioneer in Dual-SIM phones in Europe is a brand owned by Meridian Mobile, headquartered in UK. Fly is committed to provide an enhanced lifestyle with innovative technology for its consumers. Its phones are available at a price to pleasant surprise and yet offer high end design and features to the users.
Replying to Anil Mascarenhas of IIFL, Prem Kumar says, “Business model innovation comes into play in times of instability. In times of crisis, companies often find it easier to gain consensus around the bold moves required to reconfigure an existing business.”
Could you share some interesting anecdotes regarding Value creation, Turn around and transformations in the course of your career?
My career of 27 years has been learning and growing phase across industries and geographies. Through my experiences I have come to believe that to address the emerging landscape and occupy white spaces towards growth, profitable market shares and value creation, the higher management needs to recover from a closure by completely reengineering the business model and organisation.
Innovation, teamwork and striving for best quality and service are characteristics to scale great heights. Turn around and transformation is all about soul searching and focus. Sharply define your core competences, your market and your consumer, stay focused and move ahead. One must get into the mind of competitors. You must see what is not visible and see beyond the ordinary. Empower people with a clear sense of direction, focus on team building.
Entry into a business often takes place due to circumstances. Growth may come along depending on the acumen and timing. What is often not seen is the right Exit strategy. What are your thoughts on the same? Give us some examples.
Well exit strategy is about value creation. You exit a business because somebody can now take it over and enhance value of it due their resources or synergies.
It is just not enough to build a business worth a fortune but also to make sure that a successful exit strategy is in place. During my tenure with an MNC, I initiated and implemented the turnaround of South Asian Operations. This was a clear testimony to the fact that if you choose the right acquirer, your value can far exceed the estimated grade.
Also, to transform a business, it is essential to focus on core competencies. Some business units might have to be streamlined away from the product portfolio, so an effective strategy is needed to exit while minimizing tangible and intangible costs. An effective exit has a range of advantages:
Focus on simple aspects. Life is about expectation management, opportunity does not lie in the black or white space but in the grey.
Every business has to have a clear focus on value creation. A delicate balance between PNL and BS has to be stuck. People buy into growth hence the space to grow should be clearly defined and the strategy for same clearly articulated
You have advocated the need for Business model innovation over product innovation as the business turnaround strategy. Give us the reasons why.
Yes although Business Model Innovation may be more challenging than product or process innovation but it surely delivers superior returns. Unfortunately, many companies pursue business model innovation as a defensive strategy but I am convinced that if used proactively it ensures sustainability and also helps to explore new avenues of growth.
I believe one needs to be creative in business too and look outside your industry for ideas and inspiration. In my career of 27 years, I have always challenged some of the long held assumptions of the organizations I have been associated with and add my own bit of innovation.
The next wave of success, in challenging economic environment, is going to come through a series of innovations in business models across functions.
Business model innovation this is the key success area but unfortunately it’s not spoken about as much as product or technology innovation.
Mobiles have turned from a luxury a few years ago to a necessity now. How have you viewed this space and what are some interesting insights you have come across?
Over these years I have seen that customer preference changes very fast. Trends come and fade. Yes mobiles are no more a luxury but a necessity to improve a consumer’s life. In a changing environment, connecting with customers requires absolute relevance and complete and total control over the brand. With services closer to consumers of all genres, mobile makers need to focus on the product, its features, consumption and usage. Mobiles now have to aim to enhance consumer experience and improve his quality of life. A mobile phone today enjoys the max intimacy with a consumer hence it’s a part of life.
In this social jungle, Best-in-class technology and style at an affordable price point is something every manufacturer is vying to provide. What has been your experience and how do you view the competitive landscape?
In the past two decades mobiles have transitioned from a high cost business tool to an affordable personal item. The Indian mobile industry is undergoing a gradual change in a country like ours where the average income is not very high and the affordability of the product is a significant aspect for the consumer. Every manufacturer is trying to indicate that his product offers a value for money proposition. While infusing innovation, the product also has to be competitively priced to retain a significant and decisive advantage over the other industry players.
As an entrepreneur in this space I have always focused on technology and lifestyle while assuring that price competitiveness is in tune with our positioning strategy. One needs to build their growth strategies towards satisfying the unmet needs of the customers.
The key is to be very consumer and customer centric in thinking. India is land of innovation and. The missed call system of communication is a standing example how the consumer can extract value out of a product; one must respect this and work with the consumer.
Is China the main competition here?
I should say one of the main competitions apart from the Japanese and European players. Mainly because of the competitive price at which they are able to provide their technological expertise to varied customers. Newer technology and powerful channel partners are the main strengths of these markets.
To what extent do you think mobility will unshackle the entrepreneurial spirit?
Exposure across geographies, industries, consumer and customer clusters and behaviors adds a lot of value to a entrepreneur. The biggest problem in business is sometimes to be myopic and the inability to see beyond the ordinary and competition. How can you win against competition if you can’t see what they can, mobility and exposure helps in this. The exposure to company’s cultures and management styles, different industries, different geographies, helps in better understanding the business integrities.
You have had exposure to European markets and China. What is so different about the experience in India?
Great brand experiences don’t just happen; they need to be planned and managed. The Indian players often become complacent in their sales and service standards. I have had an extensive global exposure across industries. Indian consumer is creative, innovative and focused on value. Indian brands have to focus more on mid term and long term strategy of building value and just not live in today.
Given the developments in the European market, what do you think could be the methods to thrive in Chaos?
In my experience, the companies that flourish in downturns frequently, do so by leveraging the crisis to reinvent themselves. In fact it is quite exciting that in times of crisis, companies often find it easier to gain consensus around the bold moves required to reconfigure an existing business. Again I would emphasize that business model innovation comes into play in times of instability. I have succeeded in chaos and I see opportunities in there. The fact is when there is a chaos people lose their ability to think ordinary and look outside the box; this creates opportunities to go for. A good leader should never get stuck with the past, look at today and tomorrow realistically and start with a clean page.
