As much as Flipkart encouraged its employees to operate independently, it seemed the company had little patience for those who didn’t fit in or perform well immediately. These people were either fired or sidelined ruthlessly, treated like pariahs. One can argue this is a more or less well-established characteristic of internet companies. Obsessed with frenetic growth, anyone or anything that proves to be an impediment to the company must be removed immediately. The ‘Move Fast and Break Things’3 creed made famous by Facebook captures how internet companies are often run. The merciless approach towards employees is an essential aspect of this culture, where workers are the means to an end. At Flipkart, corporate ruthlessness reared its head mostly at the senior level. In the company’s early years, its junior employees, who comprised a majority of Flipkart’s workforce, felt secure in their jobs, revelled in the company’s freewheeling culture, embracing the thrill of taking on important tasks they wouldn’t be allowed to come near at most other companies.
A BIG ADVANTAGE Flipkart had over its rivals was its clever application of technology. It had divided its engineering teams loosely into two groups: demand and supply. In 2010, with a sizeable team of coders in place, Flipkart implemented its first set of major technological changes on both sides with the intention that this would complement the work of its sales and operations teams towards increasing revenue.
The website especially saw major improvements. In April 2010, Flipkart’s technology chief, Mekin Maheshwari, had hired a senior engineer named Amod Malviya, who took over the engineering function of the website. Amod was a skinny, strong-headed twenty-nine-year-old, an IIT Kharagpur graduate who had spent most of his young career working at startups. He was both technically proficient and a skilful manager of people. He believed that technology was the Supreme Function, a view Sachin shared with him. But in his first week at Flipkart, Amod clashed with Sachin. The Flipkart CEO enjoyed working closely with engineers and would often issue instructions to them without consulting with their managers. To this, Amod objected: ‘Yaar, ya tum bolo ya hamey bol ne do – either you take over or let me do my job.’ Sachin sulked, but he also stood down, and over the next five years, forged a close relationship with Amod that was often volatile but rewarding for Flipkart. In his first year alone, Amod oversaw many of the developments on the website.
The company’s plain, functional website had pleased users from the start. But the site, like all other e-commerce platforms in India, was dogged by transaction failures. For a customer, buying online was almost like playing the lottery – as much as forty per cent of all transactions fell through. This would happen due to technological glitches on the sites or on the part of their payment providers, or even because of inconsistent internet connectivity. No matter the reason, some customers who were victims of failed transactions would inevitably not return again. Amod had set up a ‘two pizza’ payments team under a subordinate, Santosh Dwivedi, that found a solution by experimenting with several payment gateways. By fusing the gateways with its systems, Flipkart could switch amongst them based on the success rates of the various gateways at any given point. By early 2011, the transaction success rate jumped to more than eighty-five per cent from less than sixty per cent. Many other e-commerce firms did not have the technological abilties or the imagination to pull off such a deep integration with several payment gateways; consequently their failure rates remained high even as Flipkart’s dropped.
Flipkart further simplified the checkout process for customers. At that time, many e-commerce companies would ask users to share unnecessary personal information, leading to long checkout times. Sachin was insistent that Flipkart should have the smoothest possible checkout process that required minimal information about customers.
In 2010, Flipkart also developed many basic functions on the website that allowed it to showcase newer categories. The company introduced technology tools that made it possible for them to process refunds and returns within a few hours, a significant improvment from the previous days-long process. The search feature was also refined. On other sites, the search function was so poor that customers would often fail to locate products even though the company actually had them in stock. But even Flipkart’s superior search function would falter in the coming years as its product assortment multiplied at a brisk pace.
IN E-COMMERCE, PRODUCTS require specialized treatment, and success in one category is no guarantee of prosperity through others, as Flipkart discovered when it expanded beyond books. Mobile phones turned out to be a particularly tricky category. Flipkart’s first investor, Accel Partners, had warned the company about the problems it would face. The Accel VCs had told the Bansals, ‘Losing a phone isn’t like losing a book – you can lose a lot of money.’ But Sachin decided, ‘Screw it, we’ll do it.’ Flipkart’s mobile phones category went live in early 2010. The first order came in shortly: a customer had purchased a Samsung phone. At that time, Flipkart still followed its ‘just-in-time’ system. After a customer ordered a product, Flipkart would source it from a distributor or an offline retailer. The company did not hold its own stock yet, which was illegal as per Indian laws. And just as it had been with Flipkart’s first-ever order in October 2007, the Samsung phone could not be located anywhere. Finally, after three days of hunting, a single unit was found at a small retailer in Bangalore.
While no one knew it at the time, this inauspicious start was a sign of things to come in the mobile phones business. Phone brands scoffed at Flipkart’s approach. Their message was the same as Accel’s warning: selling phones isn’t like selling books. ‘You can’t just stick a picture of a phone on your site and expect people to buy it,’ brands complained to Flipkart executives. Phone dealers set
