Question

second attempt. need asap please

2-4 sentences summarizing the article

4 interesting quotes from the article and 4 points explaining each quote

In the first few years of the new millennium, at the height of the boom in the offshore call-center business, Tata Consultancy Services, the Indian technology-services giant, made the counterintuitive decision to divest its call-center operations.

Why? Because although outsourced call centers were a fast-growing piece of its current business, TCS’s leadership had come to believe that they would soon be burdensome. Employee churn was exceptionally high, forcing the HR department into a round-the-clock effort to hire and train as many as half a million new reps annually. This drained resources and distracted the company from its real goal—to develop more-sophisticated capabilities and service offerings. By moving out of call centers even though demand was stronger than ever, TCS was acting to prevent the right future from being swamped by the wrong one.

TCS’s move was the result of what I call planned opportunism. The idea starts with recognizing that the future is unpredictable, shaped by nonlinear changes and chance events—the “opportunism” part. How you as a leader respond is the “planned” part. Planned opportunism requires sensitivity to weak signals—early evidence of emerging trends from which it is possible to deduce important changes in demography, technology, customer tastes and needs, and economic, environmental, regulatory, and political forces. Attention to weak signals gives rise to fresh perspectives and nonlinear thinking, which help an organization imagine and plan for various plausible futures.

TCS’s leaders had picked up on several weak signals. They saw that technologies were mov- ing to the cloud, allowing business services to be delivered as an online utility rather than through traditional enterprise-owned technology infra- structures. They rightly believed that global busi- nesses would eventually demand higher-level, more strategic outsourced services. (Sales revenue per employee tended to be higher for higher-value- added services, so by focusing on those services,

TCS could significantly improve the top line with a smaller workforce.) And they knew that TCS needed to attract increasingly sophisticated tal- ent, which would require HR’s recruiting efforts. They concluded that call centers would not lead to—in fact, would get in the way of—the future they wanted to pursue.

Planned opportunism is a systematic process not only for recognizing impending changes and ascertaining what opportunities they may offer but for developing experiments to distill and scale up promising nonlinear business ideas. It accom- plishes three exceptionally important things for the enterprise: (1) It creates a circulatory system for new ideas; (2) it develops the capacity to pri- oritize, investigate, and act on those ideas; and (3) it builds an adaptive culture that embraces contin- ual change. It will enable your organization to be proactive rather than reactive. To be sure, planned opportunism can accommodate scenario planning and other conventional tools and cultural aspira- tions, such as a flatter organization and a more em- powered workforce. But it is not just an event, an activity, or a tool. It is a discipline encompassing processes and behaviors across many functions that will strengthen resiliency and lead to growth.

Identify and Capture
Weak Signals

Organizational resiliency begins with a clear un- derstanding of the circumstances that either favor or threaten your business. Consider the case of Hasbro, the toy and game maker. By the mid-1990s significant signals that technology was likely to disrupt the gaming space could be discerned. They included the rise of PCs and the debut of Atari’s video gaming system. But Hasbro also noted weak

THE CHALLENGE

The future is shaped by nonlinear changes and chance events. How can you prepare your organization to respond?

THE STARTING POINT

Companies have to recognize the weak signals that herald important changes to the business and identify the opportunities they present.

THE WAY FORWARD

They must then develop a program of experimentation to distill and scale up promising ideas.

signals: The U.S. birthrate was falling, the popula- tion was becoming more ethnically diverse, and more households included two-income couples. At the same time, accelerated globalization stimu- lated the company’s appetite for growth in un- tapped markets around the world. Hasbro could not have predicted all the changes that would affect it over the next 20 years (see the sidebar

“How Hasbro Responded to Nonlinear Change”), but it picked up on enough weak signals to point it in productive directions.

Hasbro continues to deftly navigate frequent shifts in the industry because it has a process, devel- oped by CEO Brian Goldner, for tapping into weak signals and envisaging futures that might develop from them. The process involves asking three basic questions: What factors and conditions does our current success depend on? Which of them might change over time (or are changing already), thus putting current success at risk? How can we prepare for these possible changes in order to cushion or even exploit their impact?

Goldner’s process works for Hasbro, but other organizations can employ different, equally effec- tive approaches. TCS now uses an internal digital platform, Ultimatix, to encourage its more than 300,000 employees to share their perceptions about discontinuous industry shifts with manage- ment and one another. The company has developed a software application that sifts through the huge volume of responses and identifies common themes.

Ultimatix is one example of a free-for-all ap- proach to collecting weak signals from employees. Creating a task force to perform the same func- tion is another option. When I consulted for GE in 2008–2009, we designed a process for brain- storming about weak signals that might affect GE Healthcare’s future business in India. The challenge was to build a business to serve nonconsumers—in this case, rural Indians with limited access to health care—while competing against nontraditional rivals, including small local players. We assembled a carefully chosen task force: 20 company execu- tives (not necessarily at the top of the organization) and 20 outsiders, including hospital administrators, health care academics, government officials, non- consumers, and regulators. The members of the task force had very little vested in GE Healthcare’s past—specifically, its high-end medical imaging equipment, which it sells at a steep price to lead- ing Indian hospitals. They spent a week identifying weak signals that suggested a variety of nonlinear shifts, including extensive unmet health care needs, low customer affordability, a shortage of hospitals and qualified doctors, an underdeveloped health insurance industry, poor physical infrastructure, and good digital connectivity.

The task force and free-for-all approaches could conceivably be used in combination. Ideas gleaned from an Ultimatix-style system might be refined by a task force, or the latter’s output might get feed- back from the crowd. Whatever approach an organi- zation takes, it is important to remember that a good process must address the following questions:

• Who will be your customers in the future? What will be their priorities?

• What disruptive technologies might open up new opportunity spaces?

• Whom will you be competing against in the future, and on what basis?

• Will your go-to-market approach change funda- mentally in the future?

• What are the potential regulatory reforms?
At this stage of the process, it is not necessary to narrow down the list of weak signals. Be as divergent and expansive as possible.

Develop Hypotheses
About the Future
Weak signals are valuable only to the extent that they generate ideas about how to access currently un- served parts of the market or to create entirely new markets. To convert those ideas into real opportuni- ties, you must resolve several uncertainties, which can be framed as hypotheses. You can develop the hypotheses by assembling a cross-functional team and asking it to deliberate on this simple question: What assumptions must be true for this idea to be highly profitable?

Hasbro faced significant uncertainties when it chose to make a concerted push into the technol- ogy-based gaming space. In 1995 no one knew how quickly the internet would become a potent chan- nel. Possible competitors and partners had yet to be identified. It was unclear whether the PC would remain the dominant platform for home technology or be replaced by something else—television or per- haps a totally new device. And as the web matured, other questions emerged: How would companies serve their customers in both the physical and vir- tual realms? How would the economic model change when the industry moved from analog dollars to digital pennies?

Hasbro reframed these uncertainties as hypoth- eses that spelled out potential opportunities. For ex- ample: We can develop successful game titles based on Hasbro brands. We can develop successful titles from scratch. We can keep development costs and time frames minimal enough to be profitable, even as computers and other gaming platforms become more sophisticated. With more people buying home computers, we can reduce costs via electronic points of sale. We can expand brand awareness by creating a presence on the web. We can increase market share

by attracting new demographics. We can increase sales among current customers by expanding our product line.

Similarly, in the late 1990s Mahindra Group’s au- tomotive business, Mahindra & Mahindra, had to develop an assortment of hypotheses in the midst of transforming its future. Historically, M&M had assembled vehicles for Western automakers to be marketed to Indian consumers. Now, however, M&M believed the time was right to launch a new business in designing and manufacturing original vehicles, in particular its own line of SUVs.

In the wake of economic liberalization, India’s middle class was growing rapidly. Weak signals sug- gested that these new consumers would embrace well-performing vehicles of Indian origin that were styled to local tastes and priced in line with local means. However, the profitability of the new ven- ture required that M&M test hypotheses involving its understanding of customer preferences, the size of the addressable market, the appeal of the SUV to the growing middle class at the right price point, and M&M’s own capacities, including its ability to design and manufacture the SUV cost-effectively and to reduce costs by leveraging the strengths of suppliers.

Weak signals are typically neutral in their impli- cations and can be interpreted as opportunities, as risks, or as both. Moreover, they can be real signals or just noise. Thus their usefulness grows as your busi- ness begins to plumb their implications by convert- ing them into new business ideas, reducing the ideas to hypotheses, and then testing them.

proven competency in auto design, and the projected cost to develop the Scorpio was $120 million, which would have been M&M’s biggest investment to date.

The company decided to pursue a strategy of frugal engineering. Frugality combined with inexperience drove some especially innovative solutions in which experimentation was a crucial enabler. One experiment was M&M’s development of a new version of an existing Jeep (licensed from the U.S. automaker) that could be used as a test bed for Scorpio parts, technologies, design elements, development, and marketing strategies. According to Pawan Goenka, who headed the Scorpio project (and is now M&M’s executive director), the test bed vehicle—called the Bolero—was to be smaller and less expensive than the Scorpio. It was fast-tracked to get to market a full two years before the Scorpio, allowing sufficient time for the experiments it hosted to produce results and for the Scorpio to be tweaked accordingly. For example, M&M used the Bolero to test its ability to design and manufacture body pan- els, which the company had previously outsourced.

“Scorpio was a full 360-degree innovation,” Goenka says. “It was a new product category aimed at a new market and relying on a new development strategy, radical cost goals, and a new business model. So we used Bolero as an experiment with an investment of about $5 million. We learned a lot from Bolero before placing the bigger bet on Scorpio.”

Though the Bolero was not as finely appointed as the Scorpio would be, it was designed to be stylish and comfortable and at least as much fun as func- tional. And it tested new marketing approaches that emphasized messages and concepts more subtle than those M&M had been accustomed to using. The company’s marketing had previously been

“very generic,” according to Goenka, focused more on function and utility than on style and sizzle. The Bolero broke new ground by inverting those virtues and establishing credibility with buyers in urban centers. Consumer acceptance of the car’s stylish design and appointments validated the assumption that the Scorpio would appeal to India’s cosmopoli- tan middle class. The team also realized that no mar- ket for SUVs yet existed in India, so that designation would be meaningless. “Instead, we just called it a car,” Goenka says.

The marketing campaign also deemphasized the Mahindra brand, which was most strongly associ- ated with manufacturing Jeep-like vehicles, mainly for rural customers. In advertising, Goenka says, “we called it the Scorpio—then, sort of below in fine print, ‘by Mahindra.’” TV commercials tried to cap- ture the aspirational feel of a “typical commercial for Rolls-Royce,” he adds, “which the Indian public connected to very well.”

Answer 1

The article talks about how various organizations work on the weak signals to plan better of the future. The importance of the article lies on the emphasis successful organizations put on the collection of weak signals and act on such signals. How to quantify the opportunity that exists in these signals.

The four quotes from the articles are as follows:

1. Planned Opportunism:
   • Planned in the quote refers to the fact that future is uncertain and nonlinear and hence requires extensive planning to avoid any disruption.
   • Opportunism means how a leader would respond to the demand emanating from the weak signals.
   • Weak signals are the collection of anticipated events that are going to affect the core factors on which the organization is riding the current success.
   • Weal signals helps in emphasizing on the fresh perspectives and nonlinear thinking.
2. Organization resiliency:
   • It is the practice of understanding the factors that might hamper or favor the organization
   • Hasbro understood the factors that might hamper their current business structure and hence included more PCs going forward.
   • Hasbro understood and captured weak signals like changing demographic dividend and changed its strategy accordingly.
   • It built its business strategy, tweaked it according to the change in environment, and then executed it.
3. Capturing of weak signals:
   • Successful organizations work on capturing weak signals from their workforce who are working at the ground level.
   • TCS has built ultimatix which captures weak signals from its 300000 strong workforce
   • Hasbro CEO developed a process, which answers questions related to the weak signals that are coming from the market like what factors their current success depends on and how in the future it might change.
   • It is important to not just capture the weak signals but also to fine-tune them from the feedback, which was generated by the feedback from the workforce.
4. Converting weak signals into business ideas:
   • It is important to understand the implications that might be generated from these weak signals.
   • Mahindra understood the weak signals generating from the post liberalization of the Indian economy.
   • Decided to overhaul the strategy of integrating foreign cars to developing one, looking at the increase of Indian middle class.
   • It was important to execute the business idea properly and hence Mahindra launched bolero first and from its feedback developed Scorpio, which was marketed just as the Scorpio car without the much focus on Mahindra brand.