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By Verne Harnish
Managing complexity as a company scales up isn’t always easy. However, Vishal Group, one of the largest family businesses in Nepal, is doing so successfully. The company, which has more than 21,000 employees, is divided into 10 business verticals as diverse as manufacturing, financial services, education, real estate and agriculture.
Vishal Group began using the Scaling Up platform in approximately 2011. The leadership team wanted to make sure to position the company for successful growth. Anuj Agrawal currently a board member at the company, had founded EO Nepal in 2003 and knew of the platform through his work there. Meanwhile, his brother Arpit Agrawal, the company’s executive director, read and studied Mastering the Rockefeller Habits, the predecessor to Scaling Up: Rockefeller Habits 2.0.
They found that the Four Decisions every company must get right—People, Strategy, Execution and Cash—resonated with them as they learned more about Scaling Up. “We really had to ensure we maximized our revenue, time and profits,” Arpit says. That meant getting the board and team aligned. “It was almost as if the people had different goals and no singular objective, which was resulting in slow growth and crazy cash burn,” he says.
As a first step toward using the platform, the leadership team took a couple of weeks off to set a five-year goal: To reach every household in Nepal and “create 26 million winning smiles.” In keeping with that goal and their Brand Promise and tagline – “building better lives,” they set goals for individual verticals that fed into the company’s main ones. “The ‘Happiness Quotient’ of our stakeholders mattered the most, and we also wanted to drive profits,’” says Arpit.
Once the board was aligned, the company focused on achieving similar alignment in its leadership team. Next, it guided those leaders on seeking alignment within their respective teams. They arrived at a key revenue target for each vertical and made sure that within every facet of the company ecosystem, there was someone assigned to make sure that key performance indicators and other metrics were met. “With authority comes responsibility,” says Arpit.
Daily huddles kept the leadership team focused, making sure the company executed on its vision. “One thing that enabled us to be who we are today is our Daily Huddles,” says Arpit. “They have been the key enabler.”
Empowering a team
To unlock the potential of their team to achieve the goals, Vishal Group shifted away from a hierarchical style of leadership and micromanaging. “We gave people enough freedom and liberty within a framework to make their decisions,” Arpit says. They knew they were on the right track when every team member could, based on a quantitative measure, report whether they had a good day at work—whether that meant how many customers they signed or if they hit a sales target.
Leveraging a SWOT analysis
As the company grew, the leadership team did a Strengths, Weaknesses, Opportunities and Threats (SWOT) analysis and decided to focus on Vishal Group’s strengths: position, reputation and appetite for risk, which supported the company’s interest in moving into new verticals. “We are present in so many different business sectors, we have a big voice in the market,” says Arpit.
That strong presence created an opportunity – to give back through the VG Foundation, the company’s charitable arm. To that end, they have, over the past 12 to 14 years, supported causes such as women’s empowerment to scholarships for students. The foundation has pledged $3 million for scholarships over 10 years. “We believe education is the key to prosperity,” says Arpit.
Strengthening cash flow
As the company added four more verticals over the last eight years and tripled the size of already existing verticals, it reinvested its profits in growth. “We are a cash-rich company and adopting the Cash strategy [from Scaling Up] really helped us scale our operators and ensure bottom-line growth,” says Arpit.
With the company embarking on many new projects, it is investing in the education of its team, providing many opportunities for training. “One training per month is not sufficient, says Arpit. “We’ll have to train them once a week.” Vishal Group sees this as an investment. “People are going to be a key enabler to ensure the success of our projects,” says Arpit.