Value over Valuation
Indian Business needs to get it’s priorities right
About two months ago, my parents were travelling to Pune for some work and needed a decent place to stay. Now i’m the typical early adopter when it comes to new products, whether it’s trying out that funky new Chinese dish at the restaurant or some new app with an extremely low profile, but flawless customer experience and efficiency. For someone who loves the fact that I can make a few taps on my phone and book my parents a room in 5 minutes, I decided to use the new Oyo Rooms app that promises me exactly the right place at the right time and the right price. Needless to say I booked it, as opposed to a normal guesthouse at the same location & rates.
Then came the reality check. So post their stay for two days, they were stuck for over 2 hours arguing over the payment not being processed from the Oyo offices to their guesthouse. Mind you, this is AFTER me having paid the amount well in advance, and my parents, having to catch a flight that very day. An age old guesthouse or multi million dollar startup, my dad, in this case, any customer, couldn’t give any less of a crap about this, even if he wanted to, since bad service is bad service. Now any customer facing entity has issues like this, but i was startled at the response the guesthouse manager gave me post the issue being sorted. She said, and I say this to the best of my memory, that she has never had to deal with such a customer issue in all her years of running that place, only after Oyo came into the picture, did the payment system between them get complicated. How can you make such a simple transaction, practiced over decades, get ‘complicated’, especially if you now have so many millions of dollars to eradicate that very issue? Now it’s my understanding that technology is supposed to make your life easier, so how does the exact opposite happen, especially with such a solid technological infrastructure? Easy, companies start favouring valuation over actual value. In Oyo’s defence, they gave me a decent place, at short notice, with low cost, but wasted the customer’s time and peace of mind, not to mention embarrass them by assuming no payment was made at all. So they did a decent job, but not a complete one. If it was the typical guesthouse without Oyo in the picture, we would all say “ these small places, not organised, no proper paperwork or system, it happens and gets solved too” but in a place like Oyo, valued at $400 million(₹ 2,500 crores), i’d say that’s messed up. Hypothetically, even if it was the partnering guesthouse’s fault, how strained would the relationship have to be for them to immediately distance themselves from their partners at a time of crisis?
When we live in a country where businesses used to take more than 10 years to get to crore plus revenues , and now, all it takes is a promise of a good idea with some passion, and the word ‘app’ , to pocket a 100 crores in mere days, there’s excitement, hope and more ideas, but when do we stop looking at the numbers and looking at the difference it actually makes? We start raining money on businesses to scale them up and often, don’t look at the value it should create before actually spending on that swanky office and working for mere instant gratification. That’s exactly how bubbles are made, don’t believe me? Ask America, they too used the same words- ‘Hope, excitement and valuation’ to sell the American dream to millions of hardworking individuals before the crash of 2008. Different industry, same mistake.
Don’t get me wrong, I’m not hating on all those entrepreneurs, creating amazing ideas at this young age, believe me, I work with some of them and they are truly amazing! I’m simply asking some businesses, sure, you have the money, but is it truly making my life easier always? Take another example, my sister, ordered her iPhone from those folks over at Snapdeal(valued at approximately $1billion), who ended up sending a box with a broken seal, all accessories, NO iPhone, and no reasons to explain what happened. They did refund the money over 3–4 days, but that still won’t make up for the time i wasted on phone with their customer care and having a good amount of money stuck in refunds. Or the time I ordered headphones from Flipkart(valued at $11Billion) and got the wrong product, with a delayed refund inspite of a ‘premium’ membership. Not to mention the record number of abuses Flipkart got from both buyers and sellers for it’s messy ‘Billion day sale’ full with technical glitches and price anomalies. Of course, no startup story would be complete without mentioning Housing (now valued at approximately Rs. 1500 Crore) who, after spending multiple of those crores, telling me to “look up” couldn’t help me, and many others in my community to find a single house. Not that it’s my fault, I couldn’t even get the exact house details I saw on the app after calling that number since i got stuck with an agent, who then directs me to multiple other houses, all but that one. The exact opposite of convenience.
Somebody gets it
Why can’t we focus on customer centric operations which gain trust and give a quality oriented brand over mindless numbers? Amazon managed to do it and i can vouch for it as a student abroad who always got the right product on time with ease and as a normal customer who got the same quality and service, here in India, by the way, I ended up getting the best pair of headphones from Amazon. Not to mention the crazy cool projects they work on like dabbling in the Internet of Things with Amazon Dash and Artificial Intelligence with Drone Delivery. In retrospect, they never got this much money at such an early stage, unlike Flipkart. Or when TinyOwl decides to disrupt the F&B industry and create genuine value for customers and local business alike by connecting thousands of daily commuters to their favourite food joints and homemade dishes, quickly and in the process, creating numerous jobs via delivery men. Even Uber managed to work on it’s customer value by fixing where it went wrong with security and in the process, created a stellar mix of product quality, conveneince and a superior level of customer service that got the people to trust in it again, thus creating value.
As an International Business student, and a gold medallist in the subject, i believe i have a novice, if not an experienced understanding of it. Which leads me to deduce one of the core principles of business to be this :
“Big money isn’t always good value, and bad value is never good business.”
The fundamental issue here i’m trying to address is the moment we, particularly in India stop following the herd mentality for a change, and actually focus on the fundamental objective of business, which is to create value for society in general and the people who live in it, we can probably create some entities that achieve the bottom line, make a lasting impact, and finally, add some value to a customer’s life.
