The Risk Opportunity Duality - Aditya Yadav

1. “Running an Agile Fortune 500 Company”
Aditya Yadav, aditya.yadav@gmail.com
in.linkedin.com/in/adityayadav76
*

2. *
*A Typical Global Company
*Fortune 500/1000
*200 Divisions
*40 Countries
*25000 Employees

3. @ Acme Inc.
*

4. *
*Original Question “How do we Minimize Risk?”
*The Correct Question - “Lets understand the
relationship between Risk and Opportunity and
make sure we don‟t kill the Value we can
derive from Risks when we try to address (i.e.
Mostly Prevent) risk. Allow me to show you…”

5. And The Philosophy Behind The Answer
*

6. *
*Red –> Derived
*Yellow -> Input
Telecom-Media Value Bundle Business Model/Simulation
Serial Parameter Value Std. Dev.
1Total Bandwidth Bought (GBs/Month) 1500,00,000 10.00
2WholeSale Bandwidth Rate (Rs/GB) 10 1.00
3Total Operational Cost(Rs) 15000,00,000 1477,50,167
4Media Bundle Size(GBs) 50 15.00
5Compression Efficiency (%) 60.00% 10.00%
6Compressed Media Bundle Size (GBs) 30 10
7#Hours Programming in 1 Media Bundle (HRs) 16 1
8#Proxy Servers (All Over India) 100000 1000
9Proxy/Caching Server @Tower #Fan-out/#Network-Clients 10 2
10#Consumers/Network-Client 100 15
11Bandwidth Consumed In Delivering 1 Media Bundle All Over India (GBs) 30,00,000 10,43,936
12Total # Consumers Served 1000,00,000 255,37,600
13#Media Bundles / Month 50 5
14Total Bandwidth Consumed (GBs/Month) 1500,00,000 545,92,757
15Revenue/Consumer/Month (Rs) 20 3
16Total Revenue/Month 20000,00,000 5990,20,693
17Total Profit/Month (Rs) 5000,00,000 6134,66,401
18Profit Margin (%) 33.33% 42.56%

7. *
* In an unbiased “Random” game e.g. with 20% probability of someone
winning
* Players will play if…
* They think they know the Rules & Internal Workings of The Game
better than you/others/The-House !!!
* They can beat the Probability e.g. using a Winning Streak or Lucky
Charm
* Have insider information which Tips things in their Favour
* They think they can Cheat
* They think they can influence the Randomness or the Probabilities
* …
* Or they might just have A Passion (#@$!@%!^#%^) for Gambling (
/Entrepreneurship )

8. *
* Risk „Almost Always‟ Implies Opportunity
* In the Telecom Media Value Bundle –
Business Model Example
* If Std. Dev. Is Risk
* Opportunity is in
* Changing Input/Output Combinations
* Making Better/Different Choices
* Or when they are Frozen…
* Moving the Mean‟s in a Favourable Direction
* Reducing the Std. Deviation aka Risk
* The $ Value of „The‟ Opportunity(s) is the
Δ$‟s if you are able to change the Mean or
Std. Dev. ceteris paribus
* Rule: People who can handle the most risk
make/deserve the most money.
* Rule: The Primary Purpose of a Business is
to Take Risk in a Limited Liability Legal
Construct

9. *
Aditya!!!