At redBus, we look at change as an opportunity to accelerate growth, Prakash Sangam tells Devina Joshi
When you took charge at redBus, you had to hit the ground running. How challenging was the task for you? You had to deal with miffed employees, staff churn and a general feeling of confusion.
It is a misconception that the company was dealing with disgruntled employees at the time I joined. One can't generalise based on a couple of unhappy employees. The Ibibo Group was already in the process of putting together a strong new management team drawn from outside as well as those elevated from inside the organisation.
The business fundamentals were very sound. redBus was a market leader in its space. I did hit the ground running and further consolidated the team through key hires and strengthened important functions. Processes and systems were put in place and the organisation was brought on the same page in terms of priorities and significant projects. I am happy to report that in the last year, redBus has become even stronger. The business is now growing at a rate faster than what it grew at in the year before the acquisition. And the market share has increased to upwards of 75 per cent in the online bus ticketing market.
How do you manage turmoil in an organisation? Is it more defined/ pronounced in a start-up?
At times, turmoil and change is good for the growth of an organisation. At redBus, we have seen this 'change' as an opportunity to accelerate growth. If you look at it from an individual employee's perspective, it is natural for him or her to feel anxious when sweeping changes are underway. And when they feel that way, they look up to that one person in the organisation for comfort and guidance, who is their manager. And if they sense insecurity and confusion there, then they tend to make alternative plans and start putting their interests ahead of the organisation.
In large organisations, the only way to manage this is through intense and structured communication. With the benefit of hindsight, it was managed very well at Unilever when the company moved to a regional-plus-local organisation from a country-based operation through workshops that clarified everyone's roles using documented material to aid the process. I have also seen this process not going as well at Airtel, which was a large yet very young company in the mid-2000s during one of the organisational changes that happened.
At start-ups and small organisations, I believe it is far easier to manage change because the span of direct influence of the leadership covers pretty much the whole organisation. Even if you don't interact with every employee on a daily basis, they see you in action. And people are smart enough to rely more on action than words.
Good leadership is one way of doing it but what are the other factors that contribute in making a start-up company stable?
It is people that make an organisation. And for an organisation to be stable and carry the business forward, it is important for about 10-15 people across functions and levels to stick around for a period of time. My previous organisation was Info Edge, which was an early dotcom start-up that is going strong even 15 years later because many of the early joinees in important positions stuck with the company for years and continue to do so.
For people to stick, there has to be something that binds them together which goes beyond just faith in the business and compensation. People need to be comfortable with each other and have mutual trust and respect even if they don't necessarily become bosom buddies. That is based on common values and shared beliefs, which is identified through some cultural/personality traits. In an organisation where you are hiring laterally, this fitment can only be ensured at the time of hiring. That's why I think hiring decisions are probably the most important ones that a manager often makes and I personally make it a point to be involved in hiring decisions for all critical roles.
You have worked with portals such as Jeevansaathi and Shiksha and now redBus. What makes online start-ups so exciting?
Solving problems in a better way is what all successful businesses are about. Technology gives an opportunity to provide solutions that are 10X better, and that's what is truly exciting about tech-led businesses. Also, Jeevansathi and Shiksha dealt with critical life-changing decisions for users, so the impact was high and with redBus, the impact is significant due to number of people that depend on the service.
Second, in traditional businesses, there is often a strong barrier to entry such as distribution or a presence that protects an existing business from competition, which is not the case in digital businesses. You have to be world-class because the competition could be from the best in the world. Third, the digital space is extremely dynamic. In my last seven years, I have seen the critical success factors shift from SEM (search engine marketing) and SEO (search engine optimisation) to social, mobile, apps, big data, IoT and things beyond. It requires one to keep learning and relearning which is exciting and challenging.
What are some of the ways you have tackled negative perceptions about the quality of bus transport in India? What are the key technology and marketing initiatives that can make bus travel a top choice?
Bus travel does not have a negative perception. Intercity bus passenger volume is far greater than that of air travel and it is growing faster than air passenger growth.
The difference versus air business is that the bus industry is fragmented with thousands of bus operators and sellers. redBus is an innovation which has solved the problems of the fragmented bus market by aggregating the suppliers inventory and prices online and connecting them to travellers. redBus has been focused on making bus travel pleasantly predictable for passengers.
Over the last year or so, we have focussed a lot on installing GPS on buses and providing live tracking to users. At present, about 30 per cent of all private inter-city buses have GPS. This allows users to track the bus in real-time, thus ,eliminating the need to wait endlessly at bus-stops. The app also recommends a dropping point closest to the final destination for a user who is new to a city.