Ratan Tata's legacy, Cyrus Mistry's challenge

As Ratan Tata steps down as chairman of India's largest industrial house Friday, he leaves behind for his successor at Bombay House, Cyrus Mistry, not just a $100-billion empire he helped grow 13-fold in the 21 years at its helm but also a legacy that earned him wide praise as an able corporate leader with values.

Tata joined Tata Group as an apprentice on the shop floor of Tata Steel's Jamshedpur plant in 1962. He took over the top job in 1991, succeeding uncle JRD Tata, at a crucial time when India began its market liberalisation programme and his peers at the "Bombay Group" argued against it and sought a level-playing field for their businesses.

In the more than two decades at the helm, the Cornell-educated Tata not only consolidated the group's business in domestic markets but also expanded it globally, acquiring assets, diversifying businesses and forging new linkages.

In recent years, he conceived and presented to the world the smallest car "Nano". Much before that, in 2008, the Government of India honoured him with its second-highest civilian award, the Padma Vibhushan.

"Ratan has built very adroitly on the grand foundations built by his predecessors, especially JRD. He has not only nurtured the Tata DNA but reshaped it for the new age," Says Bajaj Group chairman Rahul Bajaj.

"The very fact that he is retiring at 75 speaks volumes of his commitment to managing the Tata companies through values," Bajaj added.

Tata Group's market capitalisation, which has some 30-odd listed companies, is now nearly Rs.4.54 trillion ($825 billion), 33 times more than in 1991 when Tata took over the top job. During this period, the group's aggregate sales have increased 43 times, while net profit has grown 51 times.

Tata Group's global expansion started in 2000 with the acquisition of Britain's largest tea firm, Tetley, by Tata Tea, now called Tata Global Beverages.

Since then Tata Group has made several big-ticket global acquisitions, including the purchase of Anglo-Dutch steel maker Corus Group. Tata Steel also acquired Europe's second largest steel maker Corus in 2007 for $12 billion. The company is now called Tata Steel Europe.

Another big acquisition was of iconic British auto makers Jaguar and Land Rover by Tata Motors.

The Group under Tata's leadership also made serveral other acquisitions in the global and domestic markets.

These include acquisition of controlling stake in government-run Videsh Sanchar Nigam Ltd (VSNL) by Tata Sons, purchase of heavy vehicles unit of Daewoo Motors in South Korea by Tata Motors, acquisition of Singapore's NatSteel by Tata Steel and purchase of New York-based The Pierre hotel by Indian Hotels Company.

According to those following the Tata Sons story, it was to Ratan Tata's credit that the group entered new businesses like telecommunications, finance and retail and increased focus on information technology and renewable energy.

At the same time the Group, they add, he led the exit from sectors like cement, textiles and cosmetics, while embarking on new areas. Today, as a result of that, the Tata empire has in its fold the most profitable company in the information technology busines -- Tata Consultancy Services.

Godrej Group chairman Adi Godrej said Ratan Tata leveraged the strength of TCS and Tata Motors while getting out of businesses such as Tata Oil mills and Lakme which were not a strategic fit.

"His clarity of thought and vision for the group has shone through remarkably," said Godrej, who is also the head of industry lobby Confederation of Indian Industry.

Ratan Tata is retiring from the Tata Group's top job as he turns 75, a rule he himself framed. He, however, will remain as chairman emeritus of Tata Sons. Cyrus Pallonji Mistry, 44, who was selected by a panel of eminent people, succeeds him.

Mistry will be the sixth chairman of Tata Group in its 144-year history and only second who does not carry the "Tata" surname. Other people who held the position of chairman of the Tata Group, apart from Ratan Tata, are: Jamsetji Nusserwanji Tata, Sir Dorab Tata, Sir Nowroji Saklatwala and J.R.D. Tata.

Ratan Tata's departure from the iconic Bombay House in downtown Mumbai marks the end of an era in which India looked outward and its business went global.

Is Facebook turning into Match.com?

The social site is testing a messaging feature associated with dating sites

Facebook has long been out in front of the social technology game, virtually inventing features like the friend feed, the timeline and memorial pages. But experts say its latest proposed strategy appears to be following the playbook of an unlikely innovator: dating websites.

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For $1, users can now send a message to a nonfriend — that is, to another user not on their friend list. Unveiling the service for U.S. users this week, Facebook said the new fee was intended less as a way of generating revenue — and more as a means of protecting user privacy. However, analysts say the company appears to be cherry-picking premium features that have been successful on dating sites and note that other companies are already using Facebook for dating. Match.com helps Facebook users mine their social networks for potential partners, while Datable.com links Facebookers who have similar interests. “I think a Facebook dating service is definitely a possibility,” says personal branding consultant Nick Gilham.

Premium services offered for a price on dating sites — such as access to photos and messages — make sense for Facebook, Gilham say. The $1 billion a year online dating business has successfully mined millions of users for revenue by nickel-and-diming them for features, he says, while Facebook has so far had a hard time doing the same. One way Facebook might clear this hurdle, Gilham says, would be to let like-minded singletons opt into a dating service for a fee and — by harnessing the vast amount of information people share —recommend potential pairings based on interests. (A spokeswoman for Facebook declined to comment.)

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Will you pay to send a message on Facebook?

Facebook has begun testing a system for users to send messages to people outside their immediate circle of social contacts for a payment of $1, as the company continues to find new ways to capitalize on its popularity. The WSJ's Yun-Hee Kim has the story.

What’s more, Facebook members are so accustomed to being able to browse the pages of people they may not know terribly well, experts say, that they might balk at being charged for the privilege. And while some professional networking sites like LinkedIn already charge to send messages and access profiles out of a person’s social network, they’ve sewn up the market for professional networking. Hunting for jobs is less acceptable on Facebook, says social media analyst Jennifer P. Brown. “If a candidate somehow found me on Facebook and sent me a note, it would be an immediate turn-off,” she says.

That said, mixing the worlds of social networking and dating could also present ethical challenges. Facebook is more synonymous with divorce than love and marriage, according to several recent studies. More than a third of divorce filings last year contained the word Facebook, according to one U.K. survey by Divorce Online, a U.K-based legal services firm. And over 80% of U.S. divorce attorneys report a rise in the number of cases using social networking, according to the American Academy of Matrimonial Lawyers. The reason? Some married Facebook members are already using the site for dating.

Salient Features of Banking Laws (Amendment) Bill 2012

The Banking Laws (Amendment) Bill 2011 was introduced in order to amend the Banking Regulation Act, 1949, the Banking Companies (Acquisition andTransfer of Undertakings) Act, 1970/1980. The said Bill has been passed by both the Houses of Parliament during its just concluded Winter Session.

This Bill would strengthen the regulatory powers of Reserve Bank of India (RBI) and to further develop the banking sector in India. It will also enable the nationalized banks to raise capital by issue of preference shares or rights issue or issue of bonus shares. It would also enable them to increase or decrease the authorized capital with approval from the Government and RBI without being limited by the ceiling of a maximum of Rs. 3000 crore.

Beside above, the Bill would pave the way for new bank licenses by RBI resulting in opening of new banks and branches. This would not only help in achieving the goal of financial inclusion by providing more banking facilities but would also provide extra employment opportunities to the people at large in the banking sector.

The salient features of the Bill are as follows:

• To enable banking companies to issue preference shares subject to regulatory guidelines by the RBI;

• To increase the cap on restrictions on voting rights;

• To create a Depositor Education and Awareness Fund by utilizing the inoperative deposit accounts;

• To provide prior approval of RBI for acquisition of 5% or more of shares or voting rights in a banking company by any person and empowering RBI to impose such conditions as it deems fit in this regard;

• To empower RBI to collect information and inspect associate enterprises of banking companies;

• To empower RBI to supersede the Board of Directors of banking company and appointment of administrator till alternate arrangements are made;

• To provide for primary cooperative societies to carry on the business of banking only after obtaining a license from RBI;

• To provide for special audit of cooperative banks at instance of RBI by extending applicability of Section 30 to them; and

• To enable the nationalized banks to raise capital through “bonus” and “rights” issue and also enable them to increase or decrease the authorized capital with approval from the Government and RBI without being limited by the ceiling of a maximum of Rs. 3000 crore under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970/1980.

Certain additional official amendments have been proposed on the basis of recommendations of the Standing Committee of Finance which gave its report on the Bill on the 13th December, 2011 and has recommended enactment of the Bill, subject to the following modifications:

i) Voting rights in banks may be restricted up to 26%.

ii) The Depositors’ Education and Awareness Fund may be used for the purpose of promoting depositors’ interests.

Further, pursuant to the discussion with Indian Banks’ Association (IBA), RBI and Industry Associations, the following additional amendments are proposed:

a) to exempt guarantee agreements of banks from the purview of the section 28 of the Indian Contract Act, 1872 to bring finality to redemption of such guarantees;

b) to allow select Directors on the Board of RBI a fixed maximum tenure of eight years with terms of not more than two terms of four years each either continuously or intermittently in consonance with the directions of the ACC;

c) to exempt conversion of branches of foreign banks to wholly owned subsidiary entities of foreign banks and transfer of shareholding of banks to the Holding Company structure pursuant to guidelines of RBI from payment of stamp duty; and

d) to ensure that unnecessary inspections are avoided and to encourage regulatory coordination, a condition has been added such that the inspection of the associate enterprise of a banking company would be conducted by RBI jointly with the sector regulator.

The tool that promises to launch the next era of websites, smartphone apps and online video is finally finished.

HTML5, the long-in-the-works update to the language that powers the Web, is "feature complete," according to an announcement made Monday by the standards-setting Worldwide Web Consortium (W3C). There's still some testing to be done, and it hasn't yet become an official Web standard -- that will come in 2014. But there won't be any new features added to HTML5, which means Web designers and app makers now have a "stable target" for implementing it, W3C said.

The HTML5 language lets developers deliver in-the-browser experiences that previously required standalone apps or additional software like Java,Adobe's (ADBE) Flash or Microsoft's (MSFT,Fortune 500) Silverlight. It supports lightning-fast video and geolocation services, offline tools and touch, among other bells and whistles.

The W3C has been developing the spec for the better part of a decade.

"As of today, businesses know what they can rely on for HTML5 in the coming years," W3C CEO Jeff Jaffe said in a prepared statement. "Likewise, developers will know what skills to cultivate to reach smart phones, cars, televisions, e-books, digital signs, and devices not yet known."

Most of the top browser makers didn't wait for the language to be 100% finished before building support for some elements into their software. The latest versions of Microsoft Internet Explorer, Google Chrome, Mozilla Firefox and Apple Safari are already compatible with most HTML5 elements.

App developers followed suit.

Netflix (NFLX) and Google's YouTube are two of the most prominent HTML5 adopters, but many others have also taken the leap. The Financial Times abandoned its smartphone app last year in favor of an HTML5 mobile website. The site looked and functioned like a native app -- with the advantage that FT didn't have to make changes to multiple versions of its code on multiple smartphone platforms. (Using a mobile website instead of a native app also let FT avoid paying Apple for in-app purchases.)

Google (GOOG, Fortune 500), a strong supporter of HTML5, produced a viral interactive video in 2010 with the help of rock band Arcade Fire that showed off the potential of the new Web features. Firefox browser maker Mozilla made a splash in February when it created a smartphone operating system called "Boot to Gecko," which is almost entirely based in HTML 5.

HTML5 grew prevalent enough by 2010 that then-Apple CEO Steve Jobs was able to unleash an epic rant against Flash and get away with it. A year later, Adobe more or less conceded that Jobs was right, abandoning its mobile Flash software in favor of HTML5 support. In November 2011 blog post, Adobe called HTML5 "the best solution for creating and deploying content in the browser across mobile platforms."

There's still more work to be done. W3C said that about 63% of Web and app developers are actively using HTML5 to make their sites and software, but "browser fragmentation"remains a big reason why many still aren't using it. Though most up-to-date browserssupport at least some aspects of HTML5, older versions of some Web browsers likeMicrosoft's (MSFT, Fortune 500) Internet Explorer don't.

That's why W3C is working on cementing HTML5 as a new Web standard, making it interoperable and fully supported by any modern browser. It will take two years to complete the testing and standardization of HTML5, the consortium said.

What's next? W3C is already working on HTML 5.1, the first parts of which were just submitted in draft form. 

Companies Still Lack Content Marketing Skills

There is still opportunity for companies to improve their content marketing strategies to drive deeper engagement with customers, according to a multi-industry survey undertaken by IMN.

The survey revealed that while content marketing is important to businesses across industries (including automotive, direct selling, franchise, financial services and insurance), companies still have inroads to make.

Regardless of industry, finding and sourcing relevant content and internal resource constraints were the top two roadblocks to successful content marketing programs.

The credit union (33%) and direct selling (31%) sectors had the highest number of respondents replying that their organizations have a formal content marketing strategy in place.

The financial services (75%), insurance (50%) and software (50%) industries are the most advanced when it comes to having separate content marketing strategies for each channel. The automotive (14%) and banking sectors (14%) were the least likely to have separate strategies in place.

Financial services (50%), insurance (50%), software (50%) and banking (43%) industries had the highest percentages responding that they do have content marketing editorial calendars in place.

The insurance (50%), credit union (33%), financial services (33%), banking (29%) and automotive (19%) sectors are concerned about the regulatory compliance of the content they distribute.

According to the results, 78% of respondents indicated that content marketing was either a medium or a high priority, while 52% did not have a separate content marketing strategy in place for each channel it distributes content through. A full 32% of respondents had a content marketing calendar in place to track the topics that would be covered, when and by whom.

Across industries, Web sites, newsletters and social media consistently ranked as the most effective content marketing vehicles, except for the financial services and software sectors, which did not list social media at all (email campaigns completed each of their top three).  Also, respondents from the insurance industry ranked video higher than social media.

Open-rate metrics for email blasts is the most popular form of content marketing program measurement for the automotive, banking, financial services and insurance industries. For franchises, software firms and direct selling organizations, the number of incoming leads was most popular. Revenue increases were the most frequent type of measurement used by credit unions.

Employee Engagement Shows Positive Benefits

Engagement of employees is becoming more critical than ever as companies seek to maximize their investments in human resources, according to Todd Hanson, president and founder of the ROI Engagement Alliance and Brad Callahan, vice president of business solutions for Marketing Innovators.

They discussed the importance and measurement of employee engagement during a recent webinar.

To show the positive impact of employee engagement, they pointed to the following figures from Employee Engagement: Market Review, Buyer's Guide and Provider Profiles, Bersin & Associates:

• Seven hundred twenty million dollars spent annually on improving engagement, an amount expected to double because integrating engagement into on-going HR programs is critical to sustained high engagement levels
• Seventy-one percent of HR execs that use scorecards incorporate engagement

They pointed out that high engagement organizations realize five times higher shareholder return and three times higher operating income than companies without strong employee engagement. The stock prices of companies with engaged employees outperform peers by 2.5-1 and outperform companies with low engagement by a factor of five.

In addition to the positive effects of employee engagement, companies also need to consider the negative effect of employee disengagement, which they estimate costs the U.S. economy as much as $350 billion.

About 60 percent of companies have an engagement program in place to recognize length of service or anniversaries. A similar percentage has a wellness engagement program.

While more than 70 percent of companies measure employee engagement a little more than a third of that percentage measure actual ROI, the presenters said.

Most of the companies who don’t conduct more in-depth of employee engagement cite lack of resources to do so, result measurement is the key to improvement, they said.

The ROI Institute has developed a methodology for these measurements, including evaluation planning, data collection, data analysis and then reporting.

The ROI methodology has been adopted by over 3,000 organizations in manufacturing, service, non-profit, and government settings and in more than 50 countries

In addition to measurement, communication is an essential element of any engagement program, Callahan said. Combined, communications and measurement provide the basis for evaluating initial success of the program.

Measurement and results of any engagement program needs to look at what participants know how to do as a result of the program, including familiarity with terms, concepts and processes, general understanding of concepts, processes, etc., and ability to demonstrate specific skills.

Callahan added that program goals should evolve over time. While some benefits may be garnered in the first 30 days, others will need to be realized over 60 or 90 days.

Brothers buy house as teens, now real estate superstars

As high school students, Jonathan and Drew Scott bought a $200,000 home with just a $250 down payment—and flipped it for a cool $250,000 after renovating it.  Today, they run a million dollar business.

That first house was purchased 16 years ago and it set the twins — womb mates by chance, best friends and business partners by choice — on a path to become television's most-watched handy hunks.

The duo dishes home buying and selling advice on HGTV's hit show "Property Brothers" and a spin-off series, "Buying and Selling."

"We grew up in a house that really incubated creativity. Our parents encouraged us to follow our passions no matter what it was," says Jonathan, who, along with Drew, dabbled in a crafts business starting at age 7.

Related Link: Brother's Dying Wish Turns Into a Family Business

The young brothers, who are as competitive as they are good-looking, were initially intrigued with entertaining, acting and magic.  But a TV infomercial sparked an interest in real estate.  "We didn't want to be starving artists," says Jonathan.

They opted to pursue formal education and licensing in real estate and construction so they could convert the hobby into a full-time gig.

"Between 2004 and 2007, our company had the majority of its success. We were doing massive commercial office projects and condo buildings," says Jonathan.

Then came the casting call.  Today "Property Brothers" attracts more than two million viewers every week—and their social media reach is double.  (Connect with them on Twitter:www.twitter.com/MrSilverScott and www.twitter.com/MrDrewScott.)

With their team of about 30 people, the brothers buy and renovate upwards of 50 homes a year, all of which take advantage of the latest technology and materials.

"A lot of my inspiration comes from commercial properties. Seeing what they're using in resorts, and bringing that to a residential application, " says Jonathan.  "When I walk into a space, I see walls moving and floors changing. We use 3D technology that shows them what we can do with a space before we bang any nails. Short of actually tearing a wall down putting up a new feature wall and saying, 'Look this is what it could look like,' now we can do that on a digital basis."

While the Scotts are on a mission to educate their audience on how to buy and sell effectively on their own, they trace their own success to their roots.

"You can't trust anybody more than your own blood and we have a chemistry that you only get when someone has sat on your head for nine months in the womb," laughs Jonathan. "Sometimes you butt heads, but at the end of the day, we're not holding any grudges."

The "Property Brothers" condensed guide to buying and selling a home:

BUYING:

• Educate yourself. Know the basics: the area, comparable selling prices and the cost of special features.
• Prep money matters. Before heading to an open house, get your finances in order. Write down your income, assets, debt and any other pertinent information. Figure out what you can realistically afford.
• Get pre-approved. Pre-approve for your financing by speaking to your lender or mortgage broker to figure out the best product for you. Bi-weekly payments, lump sum or regular increases to your payments can help you pay off that mortgage sooner and save you a lot in interest.
• Dream big. Write down absolutely everything you could want in a home, from location to size; features to amenities close by.  Mark the must haves and what you can realistically live without.
• Don't settle. Many buyer's ignore that a house is next to a train just because they like a feature in the home.  Don't overlook anything that could affect resale value.  Even if you plan to be in a home for many years, always look at the place from the eyes of the average buyer.

SELLING:

• Select a Realtor who knows your neighborhood. Yes, it means you'll pay a commission, but a skilled professional should be able to get you the most exposure and the very best price.
• Don't skimp on the staging. Declutter, depersonalize, fix minor repairs and add light.  Even on a tight budget, inexpensive touches pay off.
• Disclose. Sellers who don't reveal problems set themselves up for lawsuits down the road.  Be honest and forthcoming.
• Price right. Don't go to the top of the comparables in today's economy if you expect to sell quickly.  Proper staging and appropriate pricing can generate buzz.
• Mask emotions.  If you're desperate to sell, you'll likely lose money. If you're emotionally attached to a home, you'll overpay.  Real estate is an investment, so decisions should be made in a business frame of mind