We can do this too: That's the production houses' anthem

Till yesterday they were content to make weepies, count TRPs (television rating points), and suspend the audience's disbelief some. Now, India's soap opera factories are venturing into motion pics, at once a search for a new stream of revenues and a hedging strategy against the cyclical popularity of soaps. Big deal? Actually, despite popular perception that movies represent the logical next step for such production houses, it is. "It is more of a strategic progression that a natural one," explains Ronnie Screwvala, CEO, UTV, a Mumbai-based production company. And it is one driven by shareholder pressure. Today, several television software producers are publicly traded companies with money to spare. "Although their turnover was increasing, there was no substantial increase in profit margins," says Farokh Balsara, the head of audit firm Ernst & Young's media and entertainment practice. "The funds needed to be deployed effectively." Balsara believes that while most producers will not have a problem making movies, they could find it difficult to market and distribute them-the process is entirely different from marketing a television serial.

Some companies have sought to address this problem by focusing on low-budget ventures where they recoup costs even before the motion pic's release (through sales of music and distribution rights). "Our risks are relatively low as we will be making films that cost less than Rs 5 crore," says V. Devarajan, CFO, Balaji Telefilms. But others are going ahead and trying their hand at big-budget productions. UTV has co-produced two of the biggest motion pics that will be released this year, Lakshya and Swades, will produce three more films in association with Star TV, and several others with the likes of ace-directors Ram Gopal Varma and David Dhawan. Will it achieve box-o salvation? Watch this space.

-Priyanka Sangani

DEAL
Salesman No. 1

The Delhi-based NIS Sparta is on the verge of signing a mammoth training deal with the Reliance Group. Although details of the deal were being worked upon when BT went to press, it is reliably learnt that NIS will, in the first year alone, train a staggering 100,000 of Reliance's field force across 500 to 600 cities (direct and indirect) for both the telecom and oil businesses. The deal, unprecedented in scale, is so big that NIS is said to be creating a strategic business unit just to handle the Reliance project. Although the exact value of the deal was not available at the time of writing, knowledgeable sources put it at between Rs 40 crore and Rs 50 crore. It's a deal that NIS' President and CEO, Sanjeev Duggal (left) will be hard pressed to better in a long while to come.

-R. Sridharan

THRONE
Auto Pilot

Last month, when Sanjivnayan Bajaj, 34, was named Executive Director on the board of Bajaj Auto, the post he was being groomed for, everyone knew that it was only a matter of time before elder brother Rajivranjan Bajaj, 37 (left), was named Managing Director. After all, the two brothers have been running the company for some time and there has never been any doubt about the identity of Rahul Bajaj's successor. "The best guy to succeed me as CEO, five years from now, is Rajiv," the patriarch had said in 1999. Well, we know Rajiv Bajaj, who will become Managing Director sometime in 2004-05 is as good a manager as his father. The question is: will he make as good copy?

-Swati Prasad

SELF WORTH
Mr Microprocessor
The father of the Pentium sees every street in India with gold.

India Inside: Dham is a firm believer in the India story

One day in 2003, a five-feet eight inches tall, well-built man with the looks of an Indian, but with a distinctly American twang to his accent walked into a Chinese chip foundry. China is rapidly emerging a global power in the business of manufacturing microprocessors that are designed just about anywhere in the world and it isn't altogether surprising that people in the trade choose to visit factories, or foundries, or fabs (short for fabrication units) such as this one when they are in the country. Only, most people at the fab seemed to know the man or know of him and stood up as a mark of respect when they saw him. In the microprocessor industry Intel's Pentium chip, and the man who created it-that's what this gentleman had done-are both something of a legend.

It has been almost 10 years since 54-year-old Vinod Dham left Intel to sign on with a start-up, Nexgen. Since then, every word and move of his has been tracked by CEOs, analysts, and the media: AMD, Intel's arch rival that acquired Nexgen in 1996, proudly announced his participation in the creation of its K6 chip; Silicon Spice, the company he left AMD to join, and which was eventually acquired by Broadcom in 2000, was anointed the hottest thing going in the chips-for-telcos space; and his venture fund New Path Ventures, reckon some, has the inside track on the next big thing in microprocessors. However, the Pentium-tag has refused to go away and is clearly an albatross around the neck of Dham who keeps reiterating that the past is history. That it is; history with a capital H.

''It is the future that excites me the most," says Dham the venture capitalist. And it is India. New Path Ventures, the company that Dham co-founded has raised a $80 million (Rs 352 crore) fund to incubate companies in India or with an Indian connection. "Nowhere in the world have I encountered the kind of engineering skills we have in India," gushes Dham. "We have a way of working around even the most complicated problems." For sometime in the early 2000s, the man tried to take this message to India's software majors. India has what it takes to become the silicon semiconductor champ of the world, he told anyone who cared to listen. "The services model revolves around low-cost and high volumes," he recalls telling some executives he met then. "If somebody can do this better, India will lose its edge." Everyone he talked to heard him out politely. Some nodded their heads sagely and said they needed to think about it. Others, like Wipro Chairman Azim Premji, were more forthright. "We are happy doing what we do," Dham remembers Premji telling him. And so Dham went ahead and put his money where his mouth was. Today, New Path has invested in three companies which do a significant portion of their work in India. "I usually like companies where there is an India, US connection," says Dham. "India is where the bulk of the work gets done and the US is where the marketing happens." New Path's hit rate is low: for every 300-or-so companies it flirts with, it invests in one. And Dham is the very antithesis of the passive venture capitalist: finding employees for the companies, opening doors for them in the Valley, facilitating alliances and helping define their technology vision.

In late April, one of the world's largest electronics manufacturing services companies Flextronics invested $10 million in one such company, Insilica (New Path had earlier put in $10 million into this company; its other investments in India are Nevis Networks in which it did $10 million and Telsima, in which it did $6 million). "Flextronics paid a substantial premium," gloats Dham. "This is reassuring." Well, even someone who created the Pentium can take some comfort from the fact that he isn't alone in his belief in the Indian microprocessor story.

-Venkatesha Babu

Supermarket Secrets
Will you aggravate your bad back and pick up the 500 gm box on the lowest shelf?

Haiko secret: Eye level, impulse, layout, all help

For someone running the show at a supermarket spread over 10,000 sq feet and offering over 17,000 stock keeping units, Susil Dungarwal has a rather unusual designation: Besides being CEO of the Hiranandanis retail operations, of which Haiko Supermarket is one prong, Dungarwal has also been anointed Customer Care Executive. And he takes that role pretty seriously. Recently, Dungarwal studied the behaviour of some 2,000 consumers for 30 days on the supermarket's CCTV, and in his own words came across some "shocking revelations''. Example: The ice cream counter was earlier tucked away at the deep end of the supermarket. Consumers would pick up party packs, dump them into their trolleys, and merrily continue shopping for at least another 15-20 minutes. By the time they reached the counter, the ice cream would have invariably melted, and the consumer would ask for a fresh piece. As a result 30-35 per cent of the ice cream had to be replaced. Dungarwal has now placed the ice-cream counter near the check-outarea, resulting in substantial savings.

It's such simple observations of consumer behaviour and subsequent changes in the store layout that have helped Haiko Supermarket grow volumes by 22-24 per cent in the 60 days following the CCTV survey. For instance, to encourage impulse purchases, Dungarwal has now loaded the first few shelves of the supermarket with chocolates, biscuits and such goodies. Reason: The customer is at her impulsive best when she enters, and purchases the most during this period. The fruits and vegetables section is the last stop. This helps ensure that consumers place these items at the top of the food trolley, thereby preventing damage. Another way to boost sales is to keep the big packs at eye level, with the smaller ones lower down. Example: The 500 gm pack of Kellogg's cornflakes is kept on the lowest shelf, the 1 kg box in the middle, and the 2 kg pack on the top shelf, which is 4.5 feet high. Impulse-purchase items like confectioneries too are kept at eye level. "Consumers will first opt for products at eye-level rather than bending to pick up a product," explains Dungarwal. The 22,000-odd people who walk daily into Haiko won't mind that.

-Brian Carvalho