Month: May 2020

The buying behavior of consumer is affected by a number of factors which are generally uncontrollable. These factors are also known as determinants of consumer buying behavior. All these factors affect the buying behavior of consumer differently.

I) Cultural factors affecting consumer buying behavior:

1) Culture: Culture affects a lot the consumer buying behavior. It is the family values, beliefs, perceptions and preferences affect the consumer buying behavior.

2) Subculture: The culture includes subculture in it include nationality, religious group, and communities etc. which affect the consumer behavior.

3) Social class: It means to divide the society in different social classes, the members of different social class has different likings.

II) Social factor affecting consumer behavior:

1) Family: The members of family also affect the buying behavior of consumer. Family includes of:

• Influencer: The person who senses the need to buy a product.
• Decider: The person who takes final decision to buy the product.
• User: The person who finally uses the product.

2) Reference group: Family alone does not affect the consumer buying behavior but also the group outside the family also affects the consumer behavior. It includes the persons with whom we interact like friends, neighbors, co- workers etc.

3) Role and status: Role played by the person in the society are so many. Like a person plays the role of son, husband, brother, father, businessman etc. in his life. So the consumer buying behavior depends upon the role played by him.

III) Personal factors affecting consumer behavior:

1) Age and life style: The consumer buying behavior changes with the change in the age. Like very small child need toys to play with them and when they grow they need games, computer etc. thus, liking of consumer changes with the age.

2) Occupation: Occupation also affects the consumer behavior to buy the goods. Like an worker needs simple clothes while his boss needs expensive designer suits to wear.

3) Income: The income also affects the consumer buying behavior because if the person is rich he can buy anything which he wants to buy but for a poor person it is not be easy to buy the things which are beyond his pocket.

4) Life style: It is the way of living of the person. Like some people like luxury livings while some in simple living.

5) Personality: personality includes extrovert or introvert which also affects the consumer buying behavior.

IV) Psychological factors affecting consumer behavior:

1) Motivation: When the buyer’s need is raised to a particular level they become the motives which mean “I want to achieve this” which ultimately affect the consumer buying behavior.

2) Perception: This is how the consumer receives, selects and organizes the information which helps him in buying the goods.

3) Learning: Learning experience is helpful in affecting consumer buying behavior.

4) Beliefs and attitude: Belief means the opinion or mind set relating to a particular object; attitude means the feeling of buyer towards the object. So the marketer should keep in mind the beliefs and attitude of the consumer.

Thus, all these buying characteristics influence consumer buying behavior.

Consumer decision-making varies with the type of buying decision. There are great differences between buying toothpaste, a tennis racket, a personal computer, and a new car. Complex and expensive purchases are likely to involve more buyer deliberation and more participants.

Involvement is the perceived importance or personal relevance of an object or event. It is about the degree to which the consumer feels attached to the product or brand, and the loyalty felt towards it. Involvement has both cognitive and affective elements: it plays on both the brain and the emotions. For example, a car owner might say, ‘I love my old Ambassador [affect] because it never lets me down [cognition]. There can be 3 levels of involvement:

1. Low level of involvement occurs if attributes are irrelevant to consequences
2. Medium level of involvement occurs if the attributes only link to function
3. High product involvement will come about if the consumer feels that product attributes are strongly-linked to end goals or values. Although it is the behaviour of the decision-maker that determines the level of involvement of a decision,.

There are 3 common factors, which increase the likelihood of high involvement. These are:

1. The cost of purchase relative to income
2. The amount of time for which the purchase will be owned
3. The extent to which the purchase reflects the self-image

High-involvement purchases are those products, which figure greatly in the consumer’s lifestyle. In other words, they involve decisions which is important to get right, preferably first time. Typically, the products with which the consumer is highly involved will also be the ones which the consumer knows most about, and about which he or she has strong opinions.

Following table compares high-involvement, medium-involvement and low involvement considerations.

TABLE: Comparison of involvement levels

For example, a technology-savvy IT professional might have very strong views on which PC would give the best performance. Discrepant information (a salesperson’s attempt to persuade him to try another brand, for example) is discounted and disparaged, and may even lower the esteem of the source of the information (the IT professional will think the salesperson is stupid, or is trying to unload an inferior brand of computer).

On the other hand, a computer novice is less likely to have formed a close involvement with a product and hence is more likely to be prepared to listen to what the salesperson has to say. This means that high-involvement consumers are hard to persuade; they are not be easily swayed by advertising or even by persuasive sales pitches.

High involvement always has a strong affective component, and this does not necessarily mean a high cost commitment. People also fall in love with cheap products. So involvement does not always equate to price. A high-involvement good is not necessarily a high-priced one, nor is a low-involvement good necessarily a cheap one. Smokers can become very involved with their brand of cigarettes costing very few (Take the example of bidi or Charminar cigarette). Conversely, some people may not get involved deeply with a highly costly 5-star hotel.

Assael distinguished four types of consumer buying behaviour based on the degree of buyer involvement and the degree of differences among brands. The four types are named in the following table and described in the following paragraphs.

TABLE: Four Types of buying behaviour

1. Complex Buying Behaviour:

Consumers go through complex buying behaviour when they are highly involved in a purchase and aware of significant differences among brands. Consumers are highly involved when the product is expensive, bought infrequently, risky and highly self-expressive. Typically the consumer does not know much about the product category and has much to learn. F01 example, a person buying a personal computer may not know what attribute to look for. Many of the product features like “16K.memory” “disc storage”, “screen resolution” carry no meaning to him or her.

This buyer will pass through a learning process characterized by first developing beliefs about the product, then attitudes, and then making a thoughtful purchase choice. The marketer of a high-involvement product must understand the information-gathering and evaluation behaviour of high-involvement consumers.

The marketer needs to develop strategies that assist the buyer in learning about the attributes of the product class, their relative importance, and the high standing of the company’s brand on the more important attributes. The marketer needs to differentiate the brand’s features, use mainly print media and long copy to describe the brand’s benefits, and motivate store sales personnel and the buyer’s acquaintances to influence the final brand choice.

2. Dissonance-Reducing Buying Behaviour:

Sometimes the consumer is highly, involved in a purchase but sees little difference in the brands. The high involvement is again based on the fact that the purchase is expensive, infrequent, and risky. In this case, the buyer will shop around to learn what is, available but will buy fairly quickly because brand differences are not pronounced. The buyer may respond primarily to a good price or to purchase convenience.

After the purchase, the consumer might experience dissonance that stems from noticing certain disquieting features of the product or hearing favourable things about other brands. The consumer will be alert to information that might justify his or her decision. The consumer will first act, then acquire new beliefs and end up with a set of attitudes. Here marketing communications should aim to supply beliefs and evaluations that help the consumer feel good about his or her brand choice.

3. Habitual Buying Behaviour:

Many products are bought under conditions of low consumer involvement and the absence of significant brand differences. Consider the purchase of salt. Consumers have little involvement in this product category. They go to the store and reach for the brand. If they keep reaching for the same brand, it is out of habit, not strong brand loyalty.

There is good evidence that consumers have low involvement with most low-cost, frequently purchased products. Consumer behaviour in these cases does not pass through the normal belief/attitude/behaviour sequence. Consumers do not search extensively for information about the brands, evaluate their characteristics, and make a weighty decision on which brand to buy.

Instead, they are passive recipients of information as they watch television or see print ads. Ad repetition creates brand familiarity rather than brand conviction. Consumers do not form a strong attitude towards a brand but select it because it is familiar. After purchase, they may not even evaluate the choice because they are not highly involved with the product. So the buying process is brand beliefs formed by passive learning, followed by purchase behaviour, which may be followed by evaluation.

Marketers of low-involvement products with few brand differences find it effective to use price and sales promotions to stimulate product trial, since buyers are not highly committed to any brand. In advertising a low-involvement product, a number of things should be observed. The ad copy should stress only a few key points Visual symbols and Imagery are important because they can easily be remembered and associated with the brand.

The ad campaigns should go for high repetition with short- duration messages. Television is more effective than print media because it is a low-involvement medium that is suitable for passive learning. Advertising planning should be based on classical conditioning theory where the buyer learns to identify a certain product by a symbol that is repeatedly attached to it.

Marketers can try to convert the low-involvement product into one of higher involvement. The ways are:

1. This can be accomplished by linking the product to some involving issue, as when Crest toothpaste is linked to avoiding cavities.
2. The product can be linked to some involving personal situation, for instance, by advertising a coffee brand early in the morning when the consumer wants to shake oft sleepiness.
3. The advertising might seek to trigger strong emotions related to personal values or ego defense.
4. An important product feature might be added to a low-involvement product, such as by fortifying a plain drink with vitamins,

These strategies at best raise consumer involvement from a low to a moderate level, they do not propel the consumer into highly involved buying behaviour.

4. Variety-Seeking Buying Behaviour:

Some buying situations are characterised by low consumer involvement but significant brand differences. Here consumers are often observed to do a lot of brand’ switching. An example occurs in purchasing cookies. The consumer has some beliefs, chooses a brand of cookies without much evaluation, and evaluates it during consumption. But next time, the consumer may reach for another brand out of boredom or a wish for a different taste. Brand switching occurs for the sake of variety rather than dissatisfaction.

The marketing strategy is different for the market leader and the minor brands in this product category. The market leader will try to encourage habitual buying behavior by dominating the shelf space, avoiding out-of-stock conditions, and sponsoring frequent reminder advertising. Challenger firms will encourage variety seeking by offering lower prices, deals, coupons, free samples and advertising that presents reasons for trying something new.

Features of Consumer Behaviour:

1) Consumer behaviour and marketing management: Effective business managers realise the importance of marketing to the success of their firm. A sound understanding of consumer behaviour is essential to the long run success of any marketing program. In fact, it is seen as a comerstone of the Marketing concept, an important orientation of philosophy of many marketing managers. The essence of the Marketing concept is captured in three interrelated orientations consumers needs and wants, company integrated strategy. 

2) Consumer behaviour and non profit and social marketing: In today’s world even the non-profit organisations like government agencies, religious sects, universities and charitable institutions have to market their services for ideas to the “target group of consumers or institution.” At other times these groups are required to appeal to the general public for support of certain causes or ideas. Also they make their contribution towards eradication of the problems of the society. Thus a clear understanding of the consumer behaviour and decision making process will assist these efforts

3) Consumer behaviour and government decision making: In recent years the relevance of consumer behaviour principles to government decision making. Two major areas of activities have been affected: 

i) Government services: It is increasingly and that government provision of public services can benefit significantly from an understanding of the consumers, or users, of these services.

ii) consumer protection: Many Agencies at all levels of government are involved with regulating business practices for the purpose of protecting consumers welfare.

4) Consumer behaviour and demarketing: It has become increasingly clear that consumers are entering an era of scarcity in terms of some natural gas and water. These scarcities have led to promotions stressing conservation rather than consumption. In other circumstances, consumers have been encouraged to decrease or stop their use of particular goods believed to have harmful effects. Programs designed to reduce drug abuse, gambling, and similar types of conception examples. These actions have been undertaken by government agencies non profit organisations, and other private groups. The term “demarketing” refers to all such efforts to encourage consumers to reduce their consumption of a particular product or services.

5) Consumer behaviour and consumer education: Consumer also stands to benefit directly from orderly investigations of their own behaviour. This can occur on an individual basis or as part of more formal educational programs. For example, when consumers learn that a large proportion of the billions spend annually on grocery products is used for impulse purchases and not spend according to pre planned shopping list, consumers may be more willing to plan effort to save money. In general, as marketers that can influence consumers’ purchases, consumers have the opportunity to understand better how they affect their own behaviour.

Importance of consumer behaviour:

1) production policies: The study of consumer behaviour effects production policies of enterprise. Consumer behaviour discovers the habits, tastes and preferences of consumers and such discovery enables and enterprise to plan and develop its products according to these specifications. It is necessary for an enterprise to be in continuous touch with the changes in consumer behaviour so that necessary changes in products may be made.

2) Price policies: The buyer behaviour is equally important in having price policies. The buyers of some products purchase only because particular articles are cheaper than the competitive articles available in the market.

3) Decision regarding channels of distribution: The goods, which are sold and solely on the basis of low price mast and economical distribution channels. In case of those articles, which week T.V. sets, refrigerators etc. Must have different channels of distribution. Thus, decisions regarding channels of distribution are taken on the basis of consumer behaviour.

4) Decision regarding sales promotion: Study of consumer behaviour is also vital in making decisions regarding sales promotion. It enables the producer to know what motive prompt consumer to make purchase and the same are utilised in promotional campaigns to awaken desire to purchase.

5) Exploiting marketing opportunities: Study of consumer behaviour helps the marketers to understand the consumers needs, aspirations, expectations, problems etc. This knowledge will be useful to the marketers in exploiting marketing opportunities and meeting the challenges of the market.

6) Consumer do not always act or react predictably: The consumers of the past used to react to price levels as if price and quality had positive relation. Today, week value for money, lesser price but with superior features. The consumers response indicates that the shift had occurred.

7) Highly diversified consumer preferences: This shift has occurred due to availability of more choice now. Thus study of consumer behaviour is important to understand the changes.

8) Rapid introduction of new products: Rapid introduction of new product with technological advancement has made the job of studying consumer behaviour more imperative. For example, the information Technologies are changing very fast in personal computer industry.

9) Implementing the “Marketing concept”: This calls for studying the consumer behaviour, all customers need have to be given priority. Thus identification of target market before production becomes essential to deliver the desired customer satisfaction and delight.

Applications of consumer behaviour: 

1) Analysing market opportunity: Consumer behaviour study help in identifying the unfulfilled needs and wants of consumers. This requires examining the friends and conditions operating in the Marketplace, consumers lifestyle, income levels and energy influences. This may reveal unsatisfied needs and wants. Mosquito repellents have been marketed in response to a genuine and unfulfilled consumer need.

2) Selecting target market: Review of market opportunities often helps in identifying district consumer segments with very distinct and unique wants and needs. Identifying these groups, behave and how they make purchase decisions enable the marketer to design and market products or services particularly suited to their wants and needs. For example, please sleep revealed that many existing and potential shampoo users did not want to buy shampoo fax price at rate 60 for more and would rather prefer a low price package containing enough quantity for one or two washers. This finding LED companies to introduce the shampoos sachet, which become a good seller.

3) Marketing-mix decisions: Once unsatisfied needs and wants are identified, the marketer has to determine the right mix of product, price, distribution and promotion. Where too, consumer behaviour study is very helpful in finding answers too many preplexing questions. The factors of marketing mix decisions are: i) product ii) price iii) promotion iv) distribution

4) Use in social and non profits marketing: Consumer behaviour studies are useful to design marketing strategies by social, governmental and not for profit organisations to make their programmes more effective such as family planning, awareness about AIDS.

An important worth-mentioning information on types of consumer behaviour as given by Henry Assael has been reproduced here. Consumer decision making varies with the type of buying decision. There is a great difference between buying toothpaste, a tennis racket, a personal computer and a new car.

The more complex and expensive decisions are likely to involve more buyer deliberation and more buying participants. Henry Assael distinguished four type of consumer buying behaviour based on the degree of buyer involvement in the purchase and the degree of differences among brands.

The four types are:

(1) Complex Buying Behaviour:

Consumer go through complex buying behaviour when they are highly involved in a purchase and are aware of significant differences existing among brands. Consumers are highly involved in a purchase when it is expensive, bought infrequently.

Risky and highly expensive. Typically, the consumer does not know much about the product category and has much to learn. For e.g. – a person buying a personal computer may not even know what attributes to look for.

This buyer will pass through a cognitive learning process. It is characterized by first developing beliefs about the product, then moving towards attitudes towards the product, and finally making a deliberate purchase choice, the marketer of high-involvement product has to understand the information-gathering and evaluation behaviour of high-involvement consumers.

He needs to develop strategies to assist the buyer in learning about the attributes of the product class, their relative importance and the high standing of his brand on the more important attributes. He needs to differentiate the features of his brand, and enlist sales personnel and the buyer friend to influence the final brand choice.

(2) Buying Behaviour Reducing Dissonance:

Sometimes the consumer who is highly involved in a purchase sees little difference in the brands. His high involvement is based on the fact that the purchase is expensive, in-frequent and risky. The buyer will shop around to learn what is available but he will buy fairly quickly because brand differences are not pronounced.

He may respond primarily to a good price or the convenience of purchasing at time or place. For e.g. – carpet’ buying is an involving decision because it is expensive and relates to self-identification, yet the buyer is likely to consider most carpeting in a given price range to be the same.

The consumer might experience past purchase dissonance due in noticing certain disquiet features of the carpet or hearing favourable things about carpets. He starts learning more things and seeks to justify his or her decision to reduce the dissonance. He passes first through a state of behaviour, acquires some new benefits and ends up evaluating his choice favourably.

In this situation pricing, good location and effective sales personnel are important influences of brand choice. The major role of market communication is to supply beliefs and evaluations that help the consumer feel good about his or her choice after the purchase.

(3) Buying Behaviour Based on Habits:

Many products are purchased under conditions of low consumer involvement and the absence of significant brand differences. For example- in purchase category. They go to store and reach for the brand, having no strong brand loyalty. They have low involvement with most low cost, frequently purchased products. Their behaviour in these cases does pass through the normal belief/attitude/behaviour sequences. They do not search extensive information about the brands.

They evaluate their characteristics and make a weighty decision on which one to buy. They are passive recipient of information as they watch T.V. or see a print ad. Ad repetition creates brand familiarity rather than brand conviction. Consumers do not really form an attitude towards a brand but select it simply because of its familiarity.

After purchase, they may not evaluate it because they are not involved with the product. So in the buying process, brand beliefs are formed by passive learning and followed by purchase behaviour, which may be or may not be followed by evaluation.

In case of low involvement products marketers with few brand differences find it effective to use price and sales promotions are an incentive to product trial, since buyers are not highly committed to any brand. A number of things should be observed in advertising a low involvement product. The ad copy should street only a few key points.

Visual symbol and integer are important because, they can be easily remembered and associated with the brand. The ad campaigns should go for high repetition with short- duration messages. Television is more effective than print-media. It is a low involvement medium that is suitable for passive learning.

(4) Variety-Seeking Buying Behaviour:

Some buying situation depicts low consumer involvement but significant brand differences. Consumers are often observed to do a lot of brand switching. For example in purchasing cookies the consumer has some beliefs, chooses a brand of cookies without much evaluation and evaluates it during consumption. In future, the consumer may reach for another brand out of boredom or a wish to experiment. Here brand switching occurs for the sake of variety rather than dissatisfaction.

In this product category and the minor brands the marketing strategy is different for the market leader who will try to encourage habit of buying behaviour by dominating the shelf space, avoiding out-of-stock conditions and sponsoring frequent reminder advertising, on the other hand, challenging firms will encourage variety by offering lower prices, deals, coupons, free samples and advertising that features reasons for trying something new.

If there is one name that stands out for trust and integrity, it’s Ratan Tata. Born on 28 December 1937 in Surat, Ratan Naval Tata was the chairman of Tata Group, the Mumbai-based conglomerate from 1991–2012.

He has been awarded Padam Vibhushan and Padam Bhushan in the year 2008 & 2000 respectively for his contribution towards trade and industry. Known for his vision and ability to lead and innovate, he led the global foray of the largely India-based Tata Group. The 78 year old began his career with the Tata Group in 1961, and spearheaded the company from a $1.5 billion market cap to a $100 billion market cap. The legendary scion has been an inspiration for leaders across the world.

Here are the 10 Success lessons from Ratan Tata for entrepreneurs,

1. Be a visionary

When Ratan Tata joined the group, it was barely doing any business outside India. Even though many opposed him, he maintained that the company had to go global. Today half of Tata’s revenues come from overseas. Under his leadership Tata acquired brands like Tetley, Jaguar Land Rover, and Taj Boston.

2. Be humble

He is known for his humility, and there are countless examples. He started out working as a blue collar employee for Tata Steel. He personally visited the families of the 80 employees who were affected because of the 26/11 attacks. He remembers almost everyone by their first names, and is not dismissive.

3. Never give up on values

Values are something that define a company, both to its employees and its customers. Public Safety and welfare has always been one of the main core values of Tata. The Tata Group has always been known for upholding these values and when Ratan Tata took the reigns, he too reinstated these values into the company culture. As a result, Tata has become one of the most trusted brands the world over.

4. Take Risks

Taking risks is the cardinal rule of business. As a leader, one needs to have the foresight and the capability to take risks that can take the company to new heights. Coming from business family, Ratan Tata was no stranger to taking risks and once also said, “I don’t believe in making right decisions. I take decisions and then make them right.” From acquiring the Jaguar and Land Rover businesses from Ford to taking over Corus, the second-largest steel maker in Europe, Ratan Tata made significantly big moves and has managed to make things work in his favour.

5. Motivate others

Ratan Tata had the ability to inspire and motivate others which is very important for a leader. Being a great leader isn’t about checking all the right boxes but is about making sure you inspire, drive and spark your drive in others, so that they along with you, can bring about change, social innovation and progress.

6. Have faith in yourself

When you are dealing with life’s hodgepodge, every minute you take a decision. Some decisions are right while there are some decisions that may cause situations to take an unpredicted turn. At such junctures, before people lose faith in your decision making skills, you must have staunch belief in yourself and must confidently come forward to make the situation in your favour.

7. Be open to criticism

As per a famous quote by Ratan Tata, ‘Take the stones people throw at you and use them to build a monument.’ Whenever you endeavour to do something you like, you won’t always receive appreciation. There will be people who will try to pull you down and criticize to shatter your spirit. All you need to do is just ignore all the criticisms and focus on your work.

8. Use creative tendencies

Be creative rather than being reactive. Being proactive and solving problems even before they come is one of the most important qualities of an entrepreneur. A person should not have a tendency to react only when the situation demands but the person should be able to be anticipate what will happen in future and be able to adjust himself to it in present. An entrepreneur who exercises such quality is always successful.

9. Get out of the safe mode

To be successful in business you need to take risk. No risk no gain. Mr. Ratan Tata always believed in taking risk and the result is clear that the risk paid off. To be successful you need to take risk working in safe mode might make you feel comfortable but you will never be able to get best out of the system. He once said “I don’t believe in making right decisions. I take decisions and then make them right,”

10. Don’t put all your eggs in one basket

Mr. Ratan Tata believed in investing in different companies so as his investment is always safe. He acquired a stake in the growing Chinese giant Xiaomi and leading e-commerce site snapdeal. Investing in different companies ensures that your investment is safe and grows no what the situation of a particular industry is.

Read About JRD Tata

IT in India would have never been the way it is without one man: N.R. Narayana Murthy.

A chief founder of India’s largest (and most respected) IT company Infosys, he is one of prominent architect of information technology in India. Not many people would know that Mr. Murthy borrowed Rs 10,000 from his wife to start Infosys. But we all know the success story Infy (as it is fondly called) now is and it’s largely owing to the astute leadership and vision of one man.

After serving as the CEO of the company for more than two decades (1981-2002), he retired to the post of Chairman Emeritus in 2011. A recipient of numerous prestigious awards like the ‘Padma Vibhushan’, ‘Legion of Honour’ (awarded by the French government), Mr. Murthy continues to serve on the board of HSBC, Ford Foundation and the UN Foundation.

He has been constantly ranked high among top business leaders/influential personalities by renowned media organizations like The Economist, Time, CNN etc. Not only is he an IT wizard, he has successfully led key corporate governance initiatives in India. He is an IT advisor to several Asian countries. His leadership lessons are most sought-after, not only by Indians but even by managers in other countries.

We bring you his insightful and thought-provoking advice on some core concerns which confront almost every manager. However, if one reads between the lines, his lessons can be relevant for not just entrepreneurs and managers but almost everybody: students, army men, artists, and even housewives, that is anyone who aspires to make it big in his/her respective field.

Here is some amazing leadership-oriented advice from N.R. Narayana Murthy:

On Adversities and Challenges

Mr. Murthy espouses that one of the leader’s core jobs is to raise the confidence of the followers. Tough time and challenges are essential parts of the life and they will come out better at the end of it. According to him, a leader has to sustain followers’ hopes and their energy levels to handle the difficult days.

Mr. Murthy often quotes the example of Winston Churchill to stress on this point. Churchill’s gutsy leadership as prime minister for Great Britain successfully led the British people away from the brink of defeat during World War II. He raised his people’s hopes with the words, ‘These are not dark days; these are great days the greatest days our country has ever lived.’ Mr Murthy says that during a time of crisis a strong leadership is needed more than ever.

On Being a Successful Entrepreneur

Mr. Murthy suggests these four essential qualities for entrepreneur to make it big:

• Passion and will to persevere
• Giving more priority to the long-term interests
• High levels of optimism and high aspirations
• Being a team player
• On Starting a New Venture

According to Mr. Murthy, these four things can be instrumental in launching a venture:

• The Idea: One should have a clear, well-defined idea of the product/service he wants to sell.
• Market value of the idea: One must have a basic level of confidence in the fact that the market values your product and is willing to pay for it.
• Team: One must have a team of “complementary skillsets”. A team may be composed of people with varied skillsets but they must complement a common cause.
• High Aspirations: Aim high and work hard for that.

On Building Trust

Mr. Murthy is of the view that trust and confidence can only come when there is a premium on transparency. “The leader has to create an environment where each person feels secure enough to be able to disclose his or her mistakes, and resolves to improve,” he emphasizes. He further adds that even investors respect the organisations which are transparent and have high degree of credibility. He says, “At Infosys, our philosophy has always been, ‘When in doubt, disclose.’”

On Values

Mr. Murthy has always highighted importance of a value system in an organization. And, compliance to a value system creates the environment for people to have high aspirations, self-esteem, belief in fundamental values, confidence in the future and the enthusiasm necessary to take up apparently difficult tasks. What he’s really stressing here is that having a value system is not all. Leaders have to follow it themselves and thus lead by example. As they say, “they have to walk the talk.”

On Work Life Balance

Mr. Murthy doesn’t really identify with the concept of work life balance. He had once said, “First let’s make a life, then think about work-life balance. I don’t understand the concept of a work-life balance.”

On Success

Mr. Murthy’s definition of a successful person is “one who when he/she walks into a room, people’s eyes light up. If he/she brings a smile to people’s faces, then irrespective of whether that person is educated, not educated, self-employed, employed, I would still consider that person to be successful.”

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Dhirajlal Hirachand Ambani, better known as Dhirubhai Ambani, is not an unheard name to any Indian. From being a spice dealer at fifteen to a cloth merchant to a textile producer, it was his enthusiastic ambition and inexhaustible energy that led him overcome all obstacles to emerge out as a business tycoon possessing the loftiest potential not only in India but also worldwide; someone that every entrepreneur dreams of becoming someday.

He’s the founder of Reliance Industries, India’s largest private sector petrochemical and textile giant. Apart from being awarded many prestigious awards including the “Padma Vibhushan”, he was also conferred “Man of the 20th century” by FICCI. A poll conducted by “The Times of India” during the dawn of 21st century voted him as The Greatest creator of wealth in the Centuries.

Dhirubhai, a Gujarati at heart, was raised in frugal living conditions right from an early age. He was aware of the inefficiencies that the family dealt with due to the meager income his father had. A lot can be learnt from him as an entrepreneur. Let us explore and get ourselves enlightened.

Start Small. Grow Big!

He started a partnership firm named “Majin” with his cousin Champaklal Damani. The very task of the company was to import polyester yarn and export spices to Yemen. The first office of Reliance Commercial Corporation was a 350 sq. feet room with one telephone, one table, three chairs and two office assistants. Both of them had different temperaments of work and take on how to do business. Unlike Damani, Ambani was a known risk-taker and believed in building inventories. The partnership, however, collapsed.

Just a year after then, Dhirubhai founded the Reliance Industries. It was through his futuristic vision and unfathomable business acumen that the company soared to great heights. It created a history in the Indian Industry, a legacy that would serve as an inspiration for generations to come.

No wonder, today the Reliance Industries is world’s largest manufacturer of polyester and it processes 2% of world’s transportation fuel.

One Life. One Goal!

Socialism and politics attracted 16-year old Dhirubhai, who started dreaming about a new and progressive India, where industries would develop at an unprecedented rate. He was ready to do his bit for his country and himself. It was his passion and active political involvement that brought him to the notice of political leaders. Though he was offered a place in one of the parties, he declined the offer, in order to walk on the route of his true forte. This is what every entrepreneur should do. Do not let anything deviate you!

CREATE equal opportunities. It builds trust!

You and your team share the same DNA. Dhirubhai always had immense faith in his team and people he worked with. He was quite fond of hearing their ideas openly. To be marked successful as an entrepreneur, focus on creating a team of people whose capabilities can be trusted implicitly. Sometimes even just asking the team and discussing can motivate everyone. Dhirubhai firmly believed that if you take care of a team then they will in turn do wonders for you.

Aloofness and an air of exclusivity in order to make things work can be good ingredients to disastrous scenarios for an entrepreneur in the long run.

Change for development

Innovation is life. Moving from one level or domain to another are crucial for any entrepreneur to nurture his business. The hunger to change and the desire to expand made Dhirubhai grow at a rampant and unbelievable pace. Excellent service was its hallmark and trust became an important factor when people traded with Reliance. A determination to change constructively can bring about positive developments. This will foster a lot of connectivity with people who would like to do business with you.

Be Bold. But be Calculative too!

The level of risk drops down if the mathematics behind it is logical. This is the quality most entrepreneurs need to inculcate within them in order to make the most out of an opportunity.

Dhirubhai believed in the concept of economics which says, “More the supply, greater is the demand”. Indubitably, this also meant a huge investment. Then it was his gut instinct and risk taking ability which took him where every entrepreneur dreams to be. Returns are important but that shouldn’t be the soul aim of a budding entrepreneur. Earning a reputation will ultimately bring in the profits.

Having a great niche

He achieved what almost everybody would consider impossible. In a life, spanning 69 years, he built from scratch India’s largest privately controlled corporate empire. Extensive marketing of the brand in the interiors of India made it a household name.

There is a very interesting story of their trial back in 1982, when the Reliance industries was up against a rights issue regarding partly convertible debentures. Rumors were out that the company was making all efforts to ensure that their stock prices did not slide an inch. The Bear Cartel (a group of stock broker that expected the market to fall, unlike the Bull Cartel) sensed an opportunity here and hence, started short selling the shares of Reliance.

The Bulls, on the other hand, started to buy the short sold shares of Reliance Industries on the Bombay Stock Exchange. The Bear Cartel was acting on the firm belief that the Bulls would be short of cash to complete the transactions and would be ready for settlement under the “Badla” trading system operative in the BSE. Their strategy failed mysteriously.

It was then when Dhirubhai intervened and provided the share holders with the physical delivery of the share. Initially bought at Rs.152 per share by the Bulls, they demanded an “Unbadla”, or penalty sum of Rs.35 per share. With this the demand escalated drastically and the share price of Reliance shot above Rs.180 in minutes. Voila! This settlement caused enormous uproar in the market.

The Bombay Stock Exchange was totally suspicious of some unfair trade and to find out the truth, it remained closed for three business days. Authorities from BSE intervened in the matter and brought down the “Unbadla” rate to Rs. 2 with a stipulation that the Bear Cartel had to deliver the shares within the next few days. The Bear Cartel bought shares of Reliance from the market at higher price levels and it also learnt that Dhirubhai himself supplied those shares to the Bear Cartel and earned a healthy profit out of the Bear Cartel’s adventure. Though not an academically brilliant student, Dhirubhai displayed exceptional leadership skills. Again something to learn.

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While our parents are typically the ones to teach us life skills, there are others out there who can provide lessons about life skills. Facebook founder Mark Zuckerberg is one of these people whose public experience taught me about what it really means to achieve success. Here are seven life skills that I learned from him, and how you can apply them to your own career:

1. Equanimity

This is a fancy way of saying that Zuckerberg doesn’t lose his cool when he’s under pressure or in a stressful situation. Instead, he calmly approaches even the most difficult situations because anger doesn’t breed success it only serves to alienate or give the impression that someone feels they don’t have control over a situation. Developing this equanimity has helped improve my relationships with employees and colleagues while providing a way to think more clearly about the critical problem or pressures in front of me.

2. Critical thinking

Zuckerberg has noted his interest in always going deeper with an issue or idea in order to really make a difference, be disruptive and maximize the value. As he once said, “I got my first computer in the 6th grade or so. As soon as I got it, I was interested in finding out how it worked and how the programs worked and then figuring out how to write programs at just deeper and deeper levels within the system.” I could see that success only comes from taking the time to think more critically rather than just accepting the first idea that comes to mind.

3. Problem-solving

Zuckerberg has always focused on solving problems. As he noted in a biography about him, “The question I ask myself like almost every day is, ‘Am I doing the most important thing I could be doing?’ Unless I feel like I’m working on the most important problem that I can help with, then I’m not going to feel good about how I’m spending my time.” I knew that, at the heart of every business I considered creating, there had to be a relevant problem that needed solving to help a consumer or a business.

4. Effective communication

While many leaders leave employee communication to others on the team, Zuckerberg has always taken on this role himself. In creating a company that increases communication and interaction between people, it makes sense that he would also take this approach with his employees. Many of those who have worked at Facebook note how he is always walking around, talking to everyone, asking questions and getting to know them personally. When I tried this for myself, I realized how much more willing my team members were to share what was going on, how they felt, and voice any ideas they had for making changes. Keeping open communication with your team not only builds trust but can also help you be a more effective leader.

5. Assertiveness

Zuckerberg is not interested in following or doing things on other people’s terms. As he noted in a Wired Magazine interview, “Sometimes we are going to do stuff that’s controversial, and we’re going to make mistakes. We have to be willing to take risks.” It’s this attitude that proves how a product, service, company and brand can make strides in completely changing an industry. Success doesn’t come from worrying about how something will work; instead, you just have to jump in and do it.

6. Mindfulness

Zuckerberg doesn’t let his critics get to him. I learned that the ability to ignore the noise around me has helped me to use the energy I would have wasted on worrying about what others thought of me. I use it to fuel creativity, innovation and actions that have furthered my business success. Taking a mindful approach to what you want to accomplish and blocking out the rest is critical.

7. Vision

In recent years, Zuckerberg has become more involved in shaping the global business landscape, illustrating that he is more than just a “one-hit wonder.” His recent address at the United Nations noted the need to expand Internet access to developing nations, illustrating his interest in the future of human rights and social issues. Zuckerberg has also met with country leaders as part of his vision for shaping future generations and helping tackle various global social problems. I value his leadership style and encourage those working in technology to follow suit in taking on a bigger role in real-world issues, rather than relying on politicians to do it for us.

Bill Gates dropped out of Harvard in 1974. In I975, he co-founded Microsoft a computer software company that would eventually make Gates the world’s wealthiest man. He earned the money by masterfully guiding the world into the era of networked personal computers.

Today, Gates is no longer the world’s wealthiest, but he’s still worth a healthy US$ 59 billion.

He’s retired from his role as Microsoft’s CEO and instead devotes himself full-time to philanthropy through the Bill & Melinda Gates Foundation. Below, you’ll find 10 business lessons from the life of Bill Gates.

1. Get Lucky

Gates is a very smart man, but he’s benefitted from more than his fair share of dumb luck.

In 1968, Gates was an eighth grader, attending a private middle school in Seattle called Lakeside. That year, the school invested $3,000 in a state-of-the-art computer.

13-year-old Bill joined computer club and was instantly hooked. He and a handful of other enthusiastic students racked up hours and hours on the machine, learning how to program through trial and error. It was the beginning of a journey that would propel Gates to astronomical success.

Here’s where the dumb luck comes in: in the 1960s, very few colleges had computer labs and a middle school with a computer was unheard of. The chances of a 13-year-old having access to a computer were pretty much one-in-a-million.

If Lakeside hadn’t purchased a computer, then young Bill might never have discovered his love for computer programming and he never would have started Microsoft.

2. Make the Most of the Luck You’re Given

Bill may have been ridiculously lucky, but all the computer time in the world wouldn’t have meant anything if he hadn’t dedicated himself so fully to master it.

Ultimately, it was the thousands of hours of focused labor that made Gates into the type of computer genius who could start a successful software company.

We don’t always recognize it, but each of us is uniquely lucky. Whether through our natural talents, our circumstances, or our relationships with others, we’re all fortunate to have many paths to success in front of us.

3. Bite off More than You Can Chew

Microsoft’s big break came from Bill Gates telling a fib. Gates called up a computer company called MITS and told them that they had developed a BASIC interpreter for their microcomputer, the Altair 8800.In 1975, Gates and his childhood programming buddy, Paul Allen, were looking for a way to turn their shared computer hobby into a career.

MITS was interested in seeing a demonstration of the software. This presented a problem, since the software Bill had promised didn’t actually exist.

Gates and Allen developed it in a hurry, presented it to MITS, and made the sale. They officially founded Microsoft one month later, in April 1975.

“An entrepreneur tends to bite off a little more than he can chew hoping he’ll quickly learn how to chew it.”

By always pushing yourself to deliver a little bit more than you’ve proven yourself capable of, you’ll go further, faster in your business ventures.

That said, I don’t recommend that you follow Bill’s lead and actually lie to your potential clients.

4. Quality Control is Crucial

As Microsoft grew, it began hiring more and more programmers. Gates had taken on the role of CEO and his job didn’t call for any programming. But that didn’t stop him from reviewing and often rewriting every single line of code that the company released.

Bill’s keen eye for detail ensured that Microsoft always shipped quality software. It also made sure that he never lost track of his team and that he was always intimately familiar with Microsoft’s products.

As your business grows, you’ll likely have to hire a team of employees. It may be tempting to just let them work and trust that they’re doing a good job. But your company has a reputation to protect, so take a page from Gates’ book and keep a close watch on your team’s output.

5. Revolutionary Ideas are Shown, Not Told

Computer screens once displayed just text. In the early 80’s, Bill Gates and Steve Ballmer would travel around the country delivering seminars about how graphic interfaces were the operating systems of the future but nobody believed them.

Computer companies told the Microsoft boys that graphic interfaces would be too slow and that it would be difficult to write the software for them. They were less than enthusiastic when Microsoft announced in 1983 that it was developing Windows.

6. Apple Macintosh (1984)

Attitudes changed quickly in 1984, when Apple launched the Macintosh. It became the first commercially successful computer with a graphical user interface (GUI).

All of a sudden, it was obvious to everyone that the wave of the future involved windows, icons, menus, and a pointing device. Within a few years, the market was flooded with graphical OS software. Notable examples include Deskmate, Workbench, and of course Microsoft Windows.

Microsoft was able to release Windows 1.0 in 1985, just a year after the Mac’s success, because they had actually started developing the software two years earlier.

If you’ve got a revolutionary idea, don’t worry if other people don’t get it. Start developing it now so that you’ll be prepared when the time is right.

7. Persevere

There is nothing that was overnight. Microsoft released Windows 2.0 two years later, in 1987, but it didn’t fare much better. It found moderate success thanks to software in particular, Excel, Word, and Aldus Pagemaker.

It wasn’t until 1990, when Microsoft launched Windows 3.0, that they found significant success with a graphical operating system. It was a big moneymaker for the company and it sold over 10 million units in just two years.

Microsoft had found the model that would transform them into a computer software giant.

8. Share Your Vision with Your Team

Just as Gates has seen the advent of the graphical interface years in advance, he predicted the preeminence of the Internet long before the average Joe had a dial-up connection.

By May 1995, Gates was so convinced that the Internet was Microsoft’s future, that he felt compelled to write a very, very long memo to his company. It concluded:

“The Internet is a tidal wave. It changes the rules. It is an incredible opportunity as well as incredible challenge. I am looking forward to your input on how we can improve our strategy to continue our track record of incredible success.”

Gates took the time to write this memo because he recognized how important it was for his whole team to be on board with Microsoft’s mission. The result: Windows 95 came bundled with Internet Explorer.

9. Marketing is Simple

People don’t buy a product because it’s got a great logo or a low price. They buy because they’ve got a problem and they’re convinced that the product will solve it.

The most difficult part about marketing, then, isn’t coming up with the right tagline. It’s providing a great solution to an actual problem. If you can do that and then demonstrate it, then marketing your solution is simple.

If you show people the problems and you show people the solutions, they will be moved to act. :Bill Gates

10. Don’t Learn From Success

It seems obvious that we should reflect on our successes and learn from them. If we can recognize the factors that contributed to that initial success, we should be able to repeat them and repeat our success.

But Gates has argued that success can actually cloud our vision, causing us to become over-confident and unprepared for the new challenges that the future holds.

Success is a lousy teacher. It seduces smart people into thinking they can’t lose. :Bill Gates

We shouldn’t ignore the patterns of our initial success. But neither should we cling blindly to particular actions or strategies simply because they’ve worked in the past.

Donald J Trump is recognized as the best leader and businessmen in the business world. The Trump brand and organization developed by the Donald Trump is considered as the gold standard brand all over the world. He is recognized as the finest developer of quality real estate all over the world, through the unmatched intelligence and wisdom and through the multiplicity of his interests, he have set the new prototype in the business world. He is strongly committed towards excellence and philanthropy as the part of his ethics and values. He is considered as the icon in New York and also in the countries where he is expanding his business. He possesses archetypal business and leadership skills.

In 1980, Donald J. Trump developed The Trump Organization as a group having various real estate operations and corporate associates under a single umbrella. The Trump organization provides various superior office buildings, talent agencies, hotels, recreational facilities and clubs, casinos, golf tutorials, courses and grounds and an international beauty pageant organization in different countries along with various luxuries residential and real estate construction in New York. Trump group is always committed for personal and direct involvement of leader in every respect of the projects undertaken by the group.

The project analyzes the leadership skills and practices of Donald Trump through analyzing the organizational background and theoretical concepts of leadership. In order to emphasize on the industry views about the leadership practices of Donald Trump, the views of various CEO’s, Leaders and the industry specialists of various MNC’s within UAE. Based on these views, leadership skills and practices of Donald Trump are analyzed and critically evaluated. The analysis is followed by effective conclusion and recommendation for further enhancements of leadership skills so as to achieve the strategic objective efficiently and effectively.

About (the organization)

The Trump Organization, INC facilitates various real estate constructions, sales and marketing, property services for both residential and official purposes and various other retail properties to the customers of the US and the international markets. It was being developed by Donald J Trump, who is considered as the archetypal businessman in 1980 with a great philanthropy and ethics.

History

The Trump Organization is the private company developed by the assets and capital of the Trump Family and acts as the umbrella organization or group for various business ideas and interacts of its founder Mr. Donald J Trump. These assets comprises of premium residential and commercial properties within New York such as Trump Tower, the office building at 40 Wall street in Manhattan, Trump World Tower in New York, The Trump International Hotel and Tower in addition to other residential real estates. Other assets of the umbrella include Florida resort, Golf Courses, Miss Universe organizations that operate various beauty pageants such as Miss Universe, Miss USA and Miss Teen USA and the skyscraper in Seoul, South Korea. The Trump Organization owns the share of 56 % in the public traded Trump Hotels and Casino resorts INC which operates and manages three casinos in the Atlantic City, New Jersey in addition to various other gaming developments. Donald Trump have developed a very high class business group and the empire in 1980 which was about to collapse in the recession and economic downturn of 1990-91. Due to such recession, though the group divest some of its properties but still remain as the market leader in the real estate development and very vital presence in the Manhattan real estate market. In addition to all such businesses, Donald Trump have established his public persona as a key element for his empire through the reality show “The Apprentice” in 2004 and through launching his business books such as The Art of the Deal and How to get Rich etc. Through such strong leadership skills, he is not only able to preserve his empire but evolve as global market leader in the real estate industry. Through such efforts of Donald, he was even recognized by his critics and through his successful marketing tactics he is being named as “The Human Logo” to denote him as a role model for every businessman.

Mission and vision

The vision of the Trump organization is dependent on the entrepreneurial vision of hard hitting business and setting the big goals to become the market leader in the global market of real estate and development. The Trump’s desires to success direct the vision of the company.

The mission of the company also directed by the mission of Donald Trump who aims to teach success to the people by giving them knowledge so that they are able to enhance their leadership and decision making skills which eventually helps in the overall achievement of strategic objective of the organization and the vision to become the market leader in the real estate global market. He adopts the hand on approach of learning to train the people so as to emphasize on the practical work rather than learning theoretically.

Markets (local, regional, or international)

The trump organization operates its business in the local and various international markets. It operates its business in United States and across various international borders such as Istanbul, Turkey; Scotland, Manila, Las Vegas, Panama city, the Philippines, Illinois, Seoul, South Korea, Chicago, Canada, New Jersey, Hawaii, New York, Florida, California, Los Angeles, Aberdeen, Rio Grande, Stamford, Rakaia, and Toronto etc.

Products and Services provided

The Trump Organization Inc. provides various real estate development, sales and marketing, and the property management of various residential, office and retail properties in various international markets including the local market of the US. It also offers the brokerage for the real estate services to buy, sell or leasing the commercial or residential developments and properties. It also operates the golf courses in Aberdeen, Hudson Valley, Scotland, Colts Neck, New York, California, Washington, Westchester, Florida and Philadelphia. In addition to this company also operates various restaurants, modelling agencies and pageants, managing various public events and the television production and entertainment business including various television programs and reality shows. It also provides apparels, home furnishings, jewellery and other accessories and home furnishing accessories etc.