14 Aug NALSAR University of Law, HyderabadCenter for Management StudiesMBA: I Year –

NALSAR University of Law, HyderabadCenter for Management StudiesMBA: I Year – I Semester: Academic Year: 2014-2015End-Semester (October, 2014)Product and Brand ManagementTotal Marks: 50Time : 2­1/2 HoursINSTRUCTIONS:a.i.1. Read the questions carefully and answer.a.i.2. No clarification shall be sought on the question paper.a.i.3. This is an OPEN BOOK exam. Books, notebooks, articles etc. (hard copies)are allowed and electronic items like, laptops, digital diaries etc. are ALSO allowed.a.i.4. You are not supposed to share anything in the exam. Every student shouldbring and use their own reading/reference material and belongingsa.i.5. Please answer the questions in the order that they are.a.i.6. You are expected to provide facts, figures and sources wherever they deem to benecessary.A Rendezvous I M Zapped, CEO, Tick Tockwithas part of the series,“Keep Dreaming”Date: 1st April, 2009Published in Brands & MeInterviewer: SelfyI M Zapped became Chief Executive Officer of Tick Tock Residential Security &Services Ltd. (TTRS & S) in October 2009 and oversaw its separation from its parentorganization, Godrej Locking Solutions and Systems Ltd. (GLS & S). He joined GLS & Sin 1984 as Corporate Vice President for Sales, became Chief Brand Mentor in 1986, retainedthat title while serving in a number of executive roles including President, and was electedVice Chairman in 1997. He is a trustee of the National Minorities Education Fund and sits onthe boards of Hindustan Unilever Ltd., Tata Computer Services Ltd. and United BreweriesLtd.Thank you very much for this interview. It has been quite the effort to get you to talk to us.We appreciate your presence here.As you faced your split from GLS & S, what was foremost in your mind when youthought about managing your new company’s brand?Right from the start, I believed it was important for top management, including me, to behands­on when it came to brand management. We wanted the senior team to own the brand,enforce what it stood for, and figure out how to express its promise. Doing this meant we hadto evaluate the brand we inherited, learn its attributes and decide where to take it. We saidlet’s go all in on this through research and analysis. It was a first­of­its­kind in the market andwe wanted it to remain so. Our vision has always been to “provide a safe, secure and privatepersonal space that is truly yours at a premium”.Why wasn’t brand a bigger deal at GLS & S?At GLS & S, people took the brand for granted, me included. That’s why we knew splittingoff from GLS & S, we had to find the essential brand promise for TTRS & S. We had tobuild off the old, add the new and own this entire process at the top of the company. The topleaders have to own the brand personally, deal with it viscerally, embrace it and give it thepush when we speak to internal or external stakeholders. When you finally decide on yourbrand and brand promise, you’ll come out with a lot of energy, confidence and alignment ifthe senior team has been intimately involved in brand management.What were the big questions you were trying to tackle?First, can we live off the base strength of the GLS & S brand and stake out ground for us thatis different? Second, can we create a lot of value – pumping cash into the brand’s equity?Third, could we add elements to the brand that enhance it? Finally, should we createattributes that live off or add to the GLS & S brand?In this house with several siblings, how do you measure the differences between brandsand who’s getting credit for what?The best data we have so far shows a weak but positive correlation between our sales andGodrej Interio Suites advertising. Just the addition of Godrej name in front of people, inwhatever form, helps our sales. Clearly, we’ll have to conduct periodic research with othercompanies in mind to assess the brand’s value, health and attributes. But does it matter ifyou’re selling different services? If another Godrej company is doing good where two of usare present – both companies garner goodwill. In fact, most customers don’t care that TTRS& S is separate from GLS & S.What if another Godrej company begins to have an image problem?That’s a challenge. We’ll use the traditional strengths of the GLS & S brand, and with thepowerful attributes we add, we’ll separate ourselves from our competitors no matter whathappens to our Godrej siblings.What do you want to measure to be sure you don’t need to build another brand?Nothing matters unless our brand keeps our stakeholders attrition in check. The ultimate hereis performance. We will also develop a brand that motivates our employees. It’s veryimportant that our people share the brand vision, the energy, the pride. We want people whodon’t work here to think – “Hey I’d like to work at TTRS & S, it’s a cool place.” I’d also liketo measure whether our brand has attributes that distinguish us from our competitors. Theultimate is a brand that moves customers to say, “Yes, I trust you to be the one to take usonward.” When you have that, then you have a chance not to sell on price alone.Has a better understanding of the brand given you tools to help you chart the future ofthe company through the brand? Has it helped link the brand to specific businessdecisions?It’s helping us run the company. For example, the project taught us that the GLS & S brandalone wasn’t enough. Even Godrej wasn’t enough. You have to field better offers and bemore innovative about them at each step in your journey. And you have to find a new way toexpress your brand promise. The two work in tandem. A promise only lasts for six to eightweeks unless you make good on that promise and then keep improving on it.How did your brand promise come into being?Now more than ever people understand the value of being connected to everything in theworld wherever they are. November 26 was when we switched on our TV sets and realisedthe nightmare in the neighbourhood. Our identity was being challenged, our spaces invadedand we heard those knocks on our doors and hoped it was the wind. People needed safety,assurance and control. That day our nation that is a sum of small personal spaces was underseize. And we immediately began reshaping our offers to address people’s deeply felt need.All this led us to the brand promise: It’s your space, truly yours. When we think about whatTTRS & S stands for, what the market propels us toward, we always come back to thispromise.What are you doing to infuse the brand’s energy throughout the company, all the wayto the stores?The excitement and celebration we generated on what we called our Independence Day, April1, the day of our split­off from GLS & S, is engraved in our memory. A do­the­right­thinginstinct from top to bottom in the company drives our actions. On 26 th Nov, we made freehouse calls on distress alarms, our employees spent time calming clients, even being presentwas a great relief to a lot of them. Parents, kids, pregnant women sent in thousands of e mails,smses, made thousands of calls to thank TTRS & S. They expressed their gratitude forlending an ear where necessary, providing that shoulder to cry when needed and for justbeing there when there was no one else around. It was the proof that our brand is true. Weofficially stated our character at the time of our independence. We put together our valuesand commitments and spent time on employee road shows communicating them. ButNovember 26 was the first time this had all been tested. I can’t tell you the overwhelmingresponse we received from employees, who said exactly what you’d hope they would: “Thisis a company I’m proud to work for.” Our people instantly understood how valuable theywere to the relief effort, and why we were in business: Not just to turn a quarterly profit, butto keep people safe & secure.How have you used your new ad campaign to build employee excitement and energy?We’ve taken mSec (Mobile Security) much further than a simple ad campaign. We askedemployees to be ambassadors for mSec and we’re trying to deliver a felt­like­never­beforeexperience to our customers. We’ve armed them with information and made them insiders.Through this our internal branding effort, community involvement, is now taking shape. Wehave a captive customer base and thus believe our customers are local by definition.Before November 26 there wasn’t necessarily a cohesive culture here. You were in someways a young company made up of disparate parts.We have lots of cultures. The company grew from a start­up founded by Ardhesir andPirojsha Godrej to where we are today fairly quickly. There were a series of CEOs, rapidgrowth and different strategies. Only recently have we been able to start melding our culturesand to stand for something with consistency.You’ve talked about the passion and sense of mission for providing service to everyone,how does it pan out?This is early in a marathon race. We haven’t passed the 10 Kilo Meter mark yet. Of all theGodrej branded companies, security is the one in the growth industry. We’ve got places totake customers past the lock and key. It’s exhilarating to work here. In security you’reconstantly developing new ideas or applications. Pretty soon we’ll all insert cards into ourlaptops and sync up our residential and office spaces in the hotel, in the cab riding to thehotel, cab riding home, in the garage etc. The idea is to create a responsive space thatresponds to us. This is fun. I think people get that. The prospect of being free andindependent has our latent needs captured. We’ve tapped into Godrej’s residue of innovationand entrepreneurship. Almost under cover of night, we became a very large company. Therewere 100,000 customers when I got here. Now we’re nearly 250,000. There was 7 crores inannual revenue, now there is 14 crore. But you can’t run a big company, keep it vital, keep itgrowing and keep it innovative by taking the one thing that got you to be big and just domore of it. So on top of what we sell we’re adding, why we are here, what our purpose is andwhat the brand promise is.Are you a technology company, a marketing company, a service company, or a blend ofall three?Three or four years ago the answer would have been a technology company. We knew how todeploy brand­new technology. Right now we are half­way to declaring that we’re a marketingand service company. And a marketing company is what you’ve got to be to have life after 20percent penetration. To find segments of the population who aren’t subscribed and who willgive good revenue you have to be a marketing company. There is a technology component tochoosing TTRS & S, but I’d rather be considered the company that markets best and givesthe world’s best care after the sale. That will sustain the brand more than innovation for itsown sake.We get a lot of requests for numeric values – how much is my brand worth today? Isthat a relevant issue for you?It’s tertiary. It might tell you whether you’re doing all the other stuff well. The primarymeasures are sales and retention. Secondary measures are how the brand attributes line upagainst the experience we provide. Third, if somebody wants to do a brand value study andshow where our brand ranks I am willing to make an offer unheard of. But nobody’s going tosell the corporate brand, any more than they would sell the family name. What I’d like toknow about our brand is whether people trust it to take them the next step, to the next device,to the next responsiveness application and when it’s time for us to take that step.Is there any use for a rupee based measure of brand equity, in your mind?I just don’t see the purpose. Maybe if you were breaking up a company and needed a sum­of­the parts valuation – the hardware, the receivables, the brand – I can see that use. Value is inthe customers acquired and retained, and not as a stand­alone asset. The brand is not fungible:It’s a tool that communicates promise and expectation. I can give you the details for referencethough.What experiences brought you to your understanding of brand and its power?In the early 1990s when things started to get difficult at GLS & S and we all got pressed tothink about what more we could do, I gained a sense of stewardship about things. I thinkwe’ve got an obligation beyond just quarterly income – an obligation to administer thiscompany and deploy technology so that the people in the company have good careers andlives, and the people who use our services get something more than a candy bar. A sense ofbrand came from my early times as a sales guy, Like a few other historians, I knew what hadhappened, how that institution came to be and how it thrived on more than just its quarterlyearnings. It’s just blind luck for me that I’ve landed in a place that can carry on that traditionunder a brand promise that we are making credible for the 21st century.5 Year Profile of TTRS & SLtd.PROFITABILITY Year on YearOPERATING REVENUEOperating profit before taxOperating profit after taxDIVISIONAL CONTRIBUTIONProject and ConstructionManagementProperty DevelopmentR & D Department (Techlease/licenses)Product Service DepartmentRapid Response ServicesDepartmentITES DepartmentTOTALOperating profit after tax torevenueOperating profit after tax perfull time employeeEarnings per shareOperating profit after tax toshareholders’ equityDividend per shareProfit share per employeeCORPORATE STRENGTHFunds Under Management andAdministrationEBITDATotal assetsAvailable cashBorrowingsCurrent assetsCurrent liabilitiesNet asset backing per shareRatio of current assets tocurrent liabilitiesTimes Debt to shareholders’equityDebt to shareholders’ equityplus debtNet debt to shareholders’equityDebt to total market20132012201120102009in Millionin Millionin Million12,9977564324119516420344241336421433593222059290280in Million5637313939in Million11114-11-13-15in Million15256372731in Million131111020in Million138142160164152in Millionin Million984329420336423221280%3.310.310.61513.6in 0004491518464paise84.782.671.663.958.9%8.112.111.31111.1paisein INR644,018606,36753.53,377494,786454,161in Billions81.673.273.56733.5in Millionsin Millionsin Millionsin Millionsin Millionsin Millionsin INR98410,9423,4841,0466,2663,80010.3862972916211210223424526.8848464714821544139614526.42386467416664368713375.8532235433872429478505.2r1.650.910.960.511.11%19.734.947.7229.6%16.525.932.318.18.7%-45.91732.816.3-5.7%9.611.618.89.25.1capitalisationShareholders’ equityShares on issuein Millionsin Millions5,307512Number of shareholdersNo.59,553 45113No.9,774%Number of equivalent full-timeemployeesSHAREHOLDERS’ RETURNS& STATISTICSProportion of shares on issueto top 20 shareholdersStaff shareholdingsTotal dividends declaredPayout ratioDividends reinvested/foregoneduring the year:Dividend Reinvestment PlanShare Election PlanShare prices as at 25thOctober, 20143469504323725235404291925032927252924328536462770796736434360.664.464.665.968%in Millions%13.73277613.430372132697413.52467614.621878in Millionsin Millions70.431.4101.86722.489.458.327.78653.516.268.89220112in INR213.1207.4163.314097.5

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