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THE UNIVERSAL TRUTH

The only thing constant is change. Laws of nature dictate that we change with times or perish. Newton called it “Survival of the fittest”. Adaptation is in our genes. It is this ability to modify our behaviour ever so gently with passage of time which has ensured that human race continues to prosper and flourish. What makes us perceive the need? What dictates the direction of change? Answer is simple: the inherent human intelligence. It is an almost involuntary process; a subconscious evaluation of what is happening around us and calibrating our behavior to compensate for the same.

The phenomenon holds true for the business world as well. The sharper we are in our look out, the more sensitive we are towards the trade winds, better we survive and prosper. Bury our faces in sand and we are sure to catch any random bullet! It is only prudent to keep our business instincts on alert and it is only desirable to choose wisely on how to adapt to the changes, because what seems like an almost imperceptible deviation in our behavior now; in the larger picture, it is the difference between survival and extinction, between making loss and increasing profitability.

A Case In Point

Let’s take an example of two friends, Yogeshwar and Madhav. They had similar businesses and took most of the business decisions together. Both hired warehouse space for storing goods. Yogeshwar made his decisions by force of habit but Madhav liked to make informed decisions.

Always up to date with the new developments, Madhav learnt about smart warehousing and the edge they offered over traditional structures. He discussed it with Yogeshwar as he felt that even though it appeared a little expensive right then, over the long term, it was value for money and more profitable. Looking at the price difference, Yogeshwar decided to continue using the traditional warehousing while Madhav moved on to the more modern facility. The warehouse he opted for was 40 feet high with large, transparent roof and modern fire-fighting equipment.

They decided to discuss the impact on the businesses in one year’s time.

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Reality Check

After a year, Madhav reported that he had saved 44% saving on power bills over the last year. The large transparent roofs allowed ample sunlight inside and he had to switch the lights only for 8 hours in the night during an 18 hour operation.

He was also able to optimize the space as his warehouse offered maximum vertical storage space where he installed a Ground plus 7 pallet Racking system. This resulted in a 2.5 times increase in space availability, giving him an almost 40% net saving on Rent.

The new-age, modern infrastructure with ease of operation was an intangible benefit that Madhav got apart from the tangible savings. Over all, he was happy with his decision to change.

Yogeshwar regretted his decision to not change. Not only did he struggle with poor infrastructure during the past year, he also had to deal with a fire scare in which his goods almost got burnt. The very thought of the amount of possible damage made him shiver. He was now keen to make the shift looking at the huge tangible as well as intangible benefits that Madhav’s warehouse offered.

Adapt or Perish

Looking back at what we discussed earlier, this little neglect in choosing a warehousing facility without firefighting equipment could have resulted in his Yogeshwar’s financial doom. A simple choice like this could result in the difference between survival and extinction; between profitability and irreparable loss. On the other hand, Madhav’s judgement and his desire to adapt bore him rich dividends in form of rent and power bills going down significantly, hugely offsetting the slight increase of rentals of the new facility.

These are the simple adaptations along time that we make for our businesses to ensure their long-term benefit. The larger laws of nature apply in our business lives too. As discussed in my earlier blog, To Leap or Not to Leap, this is a leap towards safety, security, profitability and longevity of our business.

Published By: Vaibhav Rathi

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