Ingredients of Entrepreneurship


Entrepreneurship is a combination of three core things (however, please note that it’s not a recipe mix that will always bring out a great entrepreneur – it’s rather more like a perspective of looking at this concept encompassing various aspects of entrepreneurship):

Personality: Includes upbringing of a person, confidence, interpersonal skills, ability to think on the feet and solve issues all the time.

Opportunity: This is the break that one gets to have. Most people I know who are curious to become an entrepreneur seem to be waiting for this perpetually. I don’t think there’s anything such as a big break. Life keeps giving you opportunities all the time, and you can only make good anyone of them if you are ready to. Moreover, an opportunity could be an opportunity for you because of your experience or academic background or interest in a particular domain.

Risk: This is the most interesting part of entrepreneurship. It’s an entrepreneur’s second nature. Risk doesn’t mean going wild with your whims, but actually refers to calculated risks an entrepreneur has to take all the time.

But even with these three, there’s one thing that must be very clear in any business opportunity. That thing is summed up in this one question: “What’s the deal?”

Deal: is all about identifying the core of any business opportunity. It is difficult to focus on this and identify what’s the real deal in a business, but with time, good entrepreneurs command this almost instinctively. I’ll be writing more about “Deals” and deal-making in the coming weeks.

MS Excel Short-cuts


In today’s post, I would be writing about two very interesting and helpful functions of Excel that could be exploited to improve efficiency when working on MS Excel:

Show All Formulas:
Sometimes, when working on complex models, one needs to give a quick run-through of the entire model to check for any inconsistencies that might have been unintentionally left out. Use ‘CTRL’ + ‘~’ to see the magic. Clicking these two together changes all the functions in a way so as to make them all visible. This is very helpful when checking the financial models or understanding the models linkages quickly.

Converting Text to Numbers: Oftentimes, when people are working on information sheets with information that is contained in a set of cells, the information extraction process can be overwhelmingly high. For instance, there could be addresses of people residing in a particular city as a text, where you want to separate their postal codes/ zip codes. Considering that the postal codes are 5-letter figures, you could use this formula ‘=VALUE(RIGHT(A10, 5)).’

Using VALUE lets you extract numbers within text and convert the same to numbers in a separate cell and RIGHT (alternatively, LEFT) is used to identify the number of characters that would be extracted from a particular cell from the right or left side, for instance, in this case, it’s 5 characters from the right of cell A10.

Assumptions Assumptions…


MS Excel is a fairly powerful tool that is very commonly used by professionals ranging from data entry staff, to analysts, to corporate executives right up to the C-level. It is ironic, however, that most of those who use MS Excel in one way or another quite regularly don’t know the power of the language. According to an estimate, only around 20% of the users actually realize the functionality and power of this software.

Assumptions Make a Difference

In proforma financial models, where linkages are spread all across the various sheets in order to make sense of the numbers in the end, one of the most important things to check first are: Assumptions.

Sometimes, these are integrated within different sheets in the model in a hap-hazard fashion, however, most properly-built models have a separate tab for Assumptions. I have seen people commit three major blunders as far as model assumptions are concerned:

Ignoring or undermining the importance of assumptions and trying to concentrate on the numbers instead: I have seen executives that just want the numbers in place. These are the kind that are often lost in the numbers, forgetting the logic behind them. They feel that by looking at the numbers hard enough, they can realize how the situation would be like in the coming years and when they want some number changed, for instance sales, they just ask to change it without realizing that if they don’t look into and change the assumptions, someone else under them would.

Being too involved in some assumptions and not caring about most: These executives often have a hard time figuring out which areas to concentrate on. Pressed for time, they just want to look into some assumptions and leave the rest. The problem, however, comes up when they get too much involved in one particular assumption to the extent that they lose sight of the big picture. For example, the amount of Capital Expenditure (CapEx) to be done in the fifth year of projection to be increased by 20% rather than 15% YoY basis. This is problematic, as all this does is to lose the connection with the overall big picture of the model.

Not carefully checking the model linkages to the assumptions: As simple as it sounds, few analysts, bankers and evaluators forget to check model assumptions’ linkages to the actual model. I have often encountered cases where certain assumptions listed in the model are not actually linked anywhere in the financial model. For analysts, that is where they need to remain careful and make sure there is no such error because in certain cases, the implications for such a loophole could mean a disaster in decision making.

So, make sure you don’t fall prey to these basic flaws when you’re handling proforma models.

On Keeping a Productive, Happy Workforce


Organizations often undermine their credibility by not valuing the importance of a bond of trust with the employees. Many a times, fairly small misinterpretation lead to disaster for the company because employees cannot see the concern they expect from the employers in the way they are communicated, treated or kept.

For instance, issues of mundane nature such as salary adjustments, bonus treatment, tax calculations, or leave pay could lead to misunderstandings that breed the seed of a feeling of unfairness or apathy in an employee’s mind. This is the kind of situation to avoid, because at the end of the day, this leads to ill-feeling about the overall workplace, reduced productivity and negative energy all around.

How could this situation be avoided?

By making sure the following, such uncalled for events can be minimized, if not eliminated:

  • Every new employee is given a proper orientation program lasting a couple of days, where company policies and work related information is effectively communicated to them.
  • All employees are kept informed and posted on any changes in  company policies and be adequately involved, or at least given time to raise their concerns about the changes to be implemented.
  • Effective HR Information System (HRIS) in place whereby all employee-related information is readily available in the most updated fashion. In smaller companies, effective record keeping and courteous human resource staff could make up for the HRIS.
  • Bi-annual statements issued (through email/postal mail) by the HR department outlining updated leaves’ status for employees, and account of any changes in policies to be implemented in the coming six months.

More than anything else, progressive organizations need to be sure that the element of fairness and equity is never compromised at all. Once an aura of a culture of “Doing the Right Thing” sets in place, the going is going to be far more smooth.

Decide today if you want a happy, productive and competent workforce – and ACT. Otherwise, don’t do anything and be left with only “deadwood” eventually. Make your choice, because not choosing is a choice too.

It’s not about the lowest cost anymore


When Michael Porter came up with Generic strategies, it was really a change in thinking. It seemed to be a different viewpoint compelling enough to be considered on its merit. The idea that any business can use one or more of the three core generic strategies (cost, differentiation and focus) came up as a revolutionary concept that consultants often focus on even today.

I often find people coming in asking how they can become the lowest cost provider in their domain of operation and seeking tips to achieve that end. I end up asking them about their businesses only to advise them not to invest their energies to becoming even lower cost provider as it’s not about the lowest cost anymore.

People often intuitively find it difficult to understand that low cost is relative and I keep quoting this example:

Suppose you have a German-educated and trained engineer working in an automotive plant who charges you 200 euros per hour and you also have another engineer from some place like Somalia, who is willing to work at 20 euros. Which one of them is the lower-cost provider?

The answer, my friends, is that you can’t ascertain yes. Most of the people get to the decision before analyzing the question, and say the Somalian engineer is the one, however, I have given no suggestion as to the creativity, productivity and skill set of the engineers yet.

Consider this additional information: If the German engineer finished work on 10 cars per hour, and the Somalian engineer needs 3 hours to finish only one car, how would the answer change now?

The German engineer is averaging you 20 euros per car, whereas the Somalian engineer costs you 60 euros per car. The latter ends up being thrice as costly as the former! Eye opening? Yes.

Moreover, we have not even considered yet the learning curve benefits, incremental quality improvements due to expertise, creativity, long-term relationship development factor, etc. that might accrue as a result of the right choice.

Please note that reference made in the above example was just illustrative and does not imply in any way superiority/inferiority of any person, place or education.

So even if you want the lowest cost, think out-of-the-box to figure out if that’s really the lowest cost solution for you.

Happy Value Buying!

Doc, Gimme a break!


Some renowned psychologist, Dr. Dorothy Rowe, said Angelina Jolie’s behavior would lead to her child’s insecure adulthood. Are you really serious? I mean, yes, it came as a shock to the poor fellow but it is all right to be shocked every once in a while. Look at it this way, the lad’s mother just taught her an important lesson in life: Don’t always believe what you see. This could be life-changing for sure, but in a positive way perhaps.

I remember we were taught at how statisticians sometimes fall prey to the trap of linking correlated data as being a case of causality, meaning to say that not always do correlations imply causal relationships. This is one such case where there could possibly be such an affirmation based on correlations but being insecure has a lot more to do with the overall upbringing and individual personality, not only with one incident such as this one.

More than anything else, the news item resembles a PR gimmick for the book of this “distinguished” author. Marketing practitioners often quote “there is nothing such as bad publicity” and this article seems to be following suit to that idea.

I would, however, credit Tim Walker for the interestingly curious title to the article. I clicked it saying “what shit!?” but the point is I clicked.

Meaning of Education


What does education mean? Who is an educated person?

Educated is not equal to literate. Literacy has to do with an ability to read and write and comes through as a result of study, practice and usually imparted in a classroom setting.

Education is beyond literacy. To me, education means the ability to think, understand and interpret things. However, most importantly, it means the ability to question. There is a problem with ascertaining the educated rate, though, of a group of people, country, or even the world because there is no such statistic.

Literacy has to do with quantity; education has to do with quality. We desperately need “educated” people, not just literate anymore.

Floods in Pakistan: Worst ever in the History of the Nation


There are instances when one feels quite helpless at the state of affairs and wonders how could he make any positive difference. Indeed, the recent floods in Pakistan is one such occasion when many Pakistanis are feeling this way. Around 20 million people are estimated to be affected by the floods directly and innumerable societal affects on a broader scale. It is a natural disaster of such a huge scale that government, military, NGOs and civil society are working together toward saving people and helping survivors still feeling quite helpless.

Some major issues that have sprung up in light of the floods and extended damage everywhere are:

  • Rescue of living people in flooded areas
  • Availability of food
  • Access to medicines, health facilities and psychological support
  • Access to clean water
  • Provision of shelter to the affectees

All these issues seek an immediate attention. It is clear that resource scarcity, ineffective resource mobilization and difficulty in doing rescue operations due to geographic difficulties are significant hurdles in the near-term.

On the longer-term, issues of higher importance remain to be resolved. Some of those issues are:

  • Channeling the floodwater out to sea and repairing/developing dams, barrages and water channels throughout the country
  • Rehabilitation of affectees back into their own areas
  • Provision of alternative homes to the affectees
  • Employment generation across all over Pakistan, especially in flood-affected areas
  • Preparing land ruined by floods for use in agriculture, again
  • Arranging for food security of the country by managing the food reserves (of wheat, rice, grains, etc.)
  • Re-establishing the social protection measures and infrastructure (schools, colleges, hospitals, clinics, roads, parks, etc.)
  • Finding hope and setting direction for the broken families, destitute adults, orphans and providing them psychological rehabilitation and some activity to keep themselves productively occupied

It indeed is a big loss and it cannot be corrected in one day, one week, one month or even one year. The short- and long-term goals for putting things back on track and bringing the house in order would need huge amounts of dedication, efforts, mutual support and commitment to a unified goal – of progressing together and reviving again. More than monetary aid, these are issues that need human care and support.

Pakistanis are a resilient nation. They have been through worst of conditions. As long as they stand united, I am sure the revival will come through. All that is needed is a firm faith in Almighty, coherent policies at the governmental level, support from all segments of the society and most importantly BELIEF in oneself and each other.


The Rise of Social Entrepreneurship


When you look around yourself, do you see problems? Do you see issues crying for attention? If you are a little conscious about your environment, your surroundings, the people you meet regularly and the places you visit routinely, you will notice a lot of things that are not how they should/could be. That’s where you can prove yourself.

Andrew Carnegie used to say that every adversity opens doors to loads of opportunities. Every problem is thus an “opportunity in disguise” – precisely what the concept of Social Entrepreneurship is all about.

It is simply about picking up a problem in your surrounding that could be improved and then moving a step ahead with actually improving the situation by solving part of the problem. You would notice there is so much that could be done that you’d have to hire people to start doing things pretty soon.

Global Geopolitics.


As we stand today, the size of the world GDP is estimated to be $70 trillion and the global population has registered to the level of 6.8 billion. However, the dispersion of income and power play amongst nations is clearly unbalanced. Today, USA is supposed to be the only superpower in the world, but that title is fast fading amidst rising Asian forces from China and India. In terms of population, the world has been exploding at an exponential pace. With the global population crossing the 6 bn. mark in the year 2000, things started changing rapidly. Now, China and India jointly comprising around 37% of the global population and the power balance is shifting.

We live in the information age today, where knowledge truly is power and economic prowess of a nation only can lead it forward in the global superpower race. There is no denying to the fact that USA would have a difficult time retaining its unipolar strength in these changing dynamics.

In order to gauge any country’s economic power and relative strength, we have to consider the following criteria in mind, amongst other things:

  • Technological Edge
  • Geographical Advantage
  • Access to Water
  • Access to Energy Sources
  • Supply of Food Channels
  • Economy’s fundamentals

USA versus China:

It might not be the biggest land area covering country on the face of earth, but USA is a huge economic force with its GDP standing at $14.26 trillion (20% of the global GDP), the country is ahead on the technology curve and thrives on innovation spearheaded by entrepreneurial activity spread all over and the country focusing its efforts on high-end value-added service sector accounting for about 77% of its GDP.

Geographically, USA has clear advantages over other upcoming superpowers. It is practically sharing borders with only two countries: Canada on the northern end and Mexico on the Southern end. Additionally, one very important point is clear in the picture below that USA has access to water from two of the largest oceans in the world, Pacific and Atlantic Oceans and it also reaches the Gulf of Mexico on the south-eastern end.

Although 71% of earth is practically water, the geopolitical climate of the world dictates that water would be a major reason for clashes in the next big World War. Here, USA clearly has edge over its chief rivals in the power game.

The off-shore oil exploration seems to be more practical again in USA’s case due to access to various oceans. At this point, it is noticeable that the per capita consumptions of oil in USA compared to China are huge. According to, USA consumed 68.672 bbl/day of oil per 1000 people whereas the consumption of oil in China stood at only 5.733 bbl/day per 1000 people (2007 data). This is definitely going to change with China working out as the ‘Global Factory’ for all the top companies all over the world. Moreover, with the increasing level of urbanization and increasing income levels in Asian countries, the per capita energy consumption is bound to shoot up.

China has a very different geography to deal with, having 14 nations bordering the country, it needs to diplomatically champion its ties with them in such a way so as to assure not only geographic security, but also economic prosperity. China borders with Afghanistan(76 km), Bhutan (470 km), Burma (2,185 km), India (3,380 km), Kazakhstan (1,533 km), North Korea (1,416 km), Kyrgyzstan (858 km), Laos (423 km), Mongolia (4,677 km), Nepal (1,236 km), Pakistan (523 km), Russia (northeast) (3,605 km), Russia (northwest) (40 km), Tajikistan (414 km) and Vietnam (1,281 km).

Due to its geographic position, China’s sea routes pass several different countries coming from the Arabian Sea on the west, and this wet bulk (Crude oil) transportation is especially risk-prone considering any unstable conditions in the region. It, therefore, makes perfect economic sense for China to help Pakistan develop Gwadar Port and adjoining infrastructure in the Baluchistan province so that the trade route for China becomes more manageable.

Also, the reason for China’s keen interest in the Iran-Pakistan gas pipeline and other oil/gas exploration and transportation projects in and through the Central Asian countries is the importance of these to China’s geo-strategic success. As the country grows further, so will its energy demands and consequently, it would need to focus on developing sustainable solutions for energy issues through the Central Asian Republic countries and other countries on its western border.

To sum up, China is an evolving power center; it has to develop and crystallize a range of strategies for geo-political security amongst other developments. So far it has been doing a good job in making sure that its long-term sustenance is not sabotaged by geographic challenges. It has to work on many different projects to achieve the status of a super power in this unipolar world.

Courtesy for data and graphs is CIA The World Factbook and World Consumption & Production data is taken from US Energy Information Administration Website.