Around the same time, Ankit Nagori, the chief business officer, resigned. After joining Flipkart in 2010 at the juniormost level, Ankit had risen to the top echelon of the company. All that was leftwas for him to occupy the hot seat. But it wasn’t to be. His stature had taken a hit after it became clear that the headlong shiftto the marketplace model had damaged the company. While Ankit hadn’t conceived the project, he was responsible for its implementation, which had been poor. All of thirty, Ankit decided to leave on his terms while he still could. Before he came to Flipkart, he had started a company of his own; now he felt ready to become an entrepreneur again.
Even though Ankit and Mukesh lefton a bitter note, their exits were graceful, especially by Flipkart’s dreadful standards. Sachin and Binny praised their contributions, and both were given warm farewells.
But there was another person, apart from Mukesh and Punit, for whom Binny had no room in his team. It was his friend and business partner, Sachin Bansal. For years Binny had admitted to colleagues that he wished Sachin would develop better interpersonal skills to mitigate his harsh personality. But he had always maintained that Sachin’s technology acumen, his relationships with investors, and above all, his audacity for coming up with transformative ideas, overshadowed all negatives. After the debacle of last year, however, Binny had changed his mind. He made himself clear: Sachin would have no say in Flipkart’s daily operations. It was one of his boldest acts ever, surprising colleagues who had seen him willingly play second fiddle to Sachin for so many years.
WITHIN A FEW weeks of taking over, Binny prepared a plan to reinvigorate the company. As COO, Binny had been the prototype of a behind-the-scenes operator. He wasn’t known to be especially decisive or imaginative – that was Sachin’s forte. Binny’s inclination and expertise lay in managing the more mundane matters, the internal organs that made the company tick.
As CEO, Binny was suddenly a man transformed. It was the first time he had been formally recognized as the top boss at Flipkart, and he revelled in the limelight. Just like Sachin, he was thrilled to be in charge, eager to outline a new path for Flipkart. He shared Sachin’s dream of building Flipkart into a giant internet company. But his methods were different, and he discarded many of his co-founder’s ways. Sachin’s two big ideas – the app-only focus and the marketplace conversion – were immediately reversed.
In fact, around this time, even Myntra had decided to reopen its website, in yet another indictment of Sachin’s failed vision. The previous year, Myntra had appointed Ananth Narayanan, a former director at McKinsey, as CEO. Within a few months of taking the reins, Ananth had informed Sachin and Flipkart’s board that he wanted to re-launch the website. Myntra was losing out on a large chunk of sales and some of its loyal customers had been alienated by the app-only move. When he was hired, Ananth had been promised complete independence in directing Myntra. Now, even though Sachin was disappointed, he kept his word and let Ananth have his way. The board, on the other hand, was thrilled. After a few months of preparation, Myntra restarted its website in June 2016, a year after it had been shut down.6
Back at Flipkart, Binny was of the opinion that the company had forgotten how to do the simple things well. There had been too much talk about technology, but little action. Despite Sachin’s sincere intent to introduce technology in every aspect of the business, he and his chosen leaders had failed to come up with a meticulous or practical approach to make it happen. In the process, the fundamentals had been ignored. Binny strived to take the company back to its roots and throw all its resources towards delivering the best shopping service to customers – what Flipkart had once been known for. He repeatedly told his team: ‘Let’s get our mojo back.’
As a start, Binny immediately ordered a reduction in costs. He called for frugality and set a goal of breaking even at the gross margin level before the end of the year. He had taken this upon himself; the company’s board of directors were primarily concerned about the slowdown in sales. But of all the leaders in Flipkart’s eight-year history, Binny had been one of the few who had constantly emphasized the need for building a self-sustaining business. He was clear that the time had come to create a strong, lasting foundation. To do that, it was essential to fix the cost structure. He was determined to break Flipkart’s dependence on fresh capital – the company couldn’t be at the mercy of investors forever.
Binny was convinced that he could accomplish both tasks together: cut costs and revive sales growth. He blamed the sales stagnation on issues such as the decline in the quality of goods and the lack of depth in product assortment, especially when compared with Amazon. ‘If Amazon has five products, we have one,’ he complained. He concluded that Flipkart should identify high-quality, high-volume products in each category and stock up on these items rather than try to compete with Amazon on offering the broadest range of goods.
