Binny was certain that if Flipkart fixed these issues, growth would return on its own. He deciphered that the growing cost bill and sales slowdown were in some ways linked. Since Flipkart now relied on third-party sellers, the quality of products had understandably deteriorated, which led to higher product returns. This, in turn, pushed up logistics costs. Additionally, with Flipkart’s sales function having lost its rigour, its product assortment was a mess. In effect, Flipkart’s service was neither cost-efficient nor particularly appealing to customers: a most wasteful combination. If the quality of goods improved and its assortment could be enhanced, the company would see an increase in sales as well as a drop in costs. Such was Binny’s confidence in this assessment that he instructed his team to reduce discounting. He wasn’t interested in ‘buying revenues’ by offering mindless discounts or entering a price war with Amazon in the smartphones business, which comprised about half of all e-commerce in India. Though these moves were evidently risky, he was willing to give up a few millions in sales to make the business truly healthier.
In March 2016, Binny elaborated on his strategy in an email to all employees: ‘Going forward, we will follow a clear set of priorities – first and always deliver product quality and service quality to our customers as a non-negotiable starting point – we cannot scale without this. Only after we deliver this should we pursue growth – this is what made Flipkart different when we started and we have to go back to these fundamentals.’7
When Flipkart was still new, Binny had spent considerable time conceiving the structures and processes according to which the company should function. Where Sachin saw himself as a technologist and attempted to mould Flipkart in that image, Binny was a corporate literature geek. He, too, was convinced about the supremacy of technology but he was equally fascinated by management theories. Despite his demanding schedule, he had been a voracious reader for many years, often getting through a book a week. He favoured non-fiction, especially books on management. He read a large range of business books. His favourites included Playing to Win, a book about Procter & Gamble, co-authored by A. G. Lafley, the company’s former CEO, and Zero to One, the startup bible co-written by Peter Thiel, an American entrepreneur and venture capitalist. He also loved reading the Harvard Business Review, the management magazine published by Harvard University. Binny would sometimes adopt the exact language of the books he had just read. After finishing Playing to Win, instead of asking colleagues, ‘What’s the strategy?’, he would say, ‘What’s your playground? What are you trying to win?’ His colleagues found it amusing. ‘It’s almost like he regretted not going to management school,’ reflects a colleague who worked closely with Binny in 2016.
Binny quickly identified the executives who would implement his directives. He handed the key sales function to Samardeep Subandh, or Samar, as everyone called him. With his vast experience in sales and marketing, Samar was an authority on the consumer goods market. For Ekart, he chose Saikiran Krishnamurthy (Saiki), who had held a senior position in the marketplace business the previous year. A graduate of IIM Ahmedabad, Saiki had joined Flipkart after spending more than fifteen years at McKinsey, where he had risen to become senior partner. Though the commerce platform had fared miserably the previous year, Saiki, as one of its seniormost executives, had escaped censure. Like many good consultants, he was a charming, smooth-talking salesman. Hair combed neatly, dressed in an understated manner, Saiki exuded good vibes. Binny was instantly impressed with him. Saiki was given a broad mandate: improve Ekart’s delivery speed, introduce more automation at Flipkart warehouses and prepare Ekart to serve other companies as a courier service. Given its substantial infrastructure, Binny believed that Ekart could become a large courier company, a rival to DHL and Blue Dart.
Another leader who quickly became an integral part of Binny’s team was Nitin Seth. After graduating from IIT Delhi and then IIM Lucknow, Nitin had worked as a consultant and run an internet startup during the dotcom boom of the early 2000s. But his healthcare startup failed miserably, after which Nitin went on to head the offshore operations of McKinsey and Fidelity International in India. Like many others who had seen the dramatic rise of Flipkart from the outside, Nitin had been enthralled by the prospect of building The Great Indian Internet Company and its immense wealth-creating potential. When he joined Flipkart as Chief People Officer in March 2016, Nitin admitted that it was ‘very inspiring to see Binny and Sachin’s vision of creating a world-class company out of India.’8 A devout Hindu, one of his favourite books was the Bhagavad Gita, which he had read many times over. Nitin’s hiring had been finalized by Sachin and Mukesh before Binny became CEO. But after Nitin joined, Binny was impressed by his energy and willingness to act boldly. Nitin sported a handlebar moustache and would regularly wear T-shirts with the Flipkart logo. In his mid-forties, he was nearly a decade older than Binny, who addressed Nitin as ‘sir’.
In early April, Binny made two more additions to his team, persuading Sameer Nigam and Rahul Chari to return to the company. In 2011, Flipkart had bought Sameer and Rahul’s music software startup Mime360. Sameer had leftthe company in July 2015 after falling out with Sachin. Rahul, who had been Sameer’s close friend for nearly two decades, followed him a few months later. By early 2016, they had decided to launch a mobile payments startup together. Unified Payments Interface (UPI), the new national digital payments infrastructure, was to be introduced later in the year. PhonePe, Sameer and Rahul’s startup, would build a UPI payments app. PhonePe had, in
