Product Lessons from Tally: The ability to deploy and start using the product within 60 seconds is the key
Shoaib Ahmed is called the enterprise specialist at Tally Solutions, one of the few successful software products from India that has stood the test of time. Ahmed is one of the few who have stuck around for long enough to see how technology has changed everything. We are talking of the early 90s when you had to print barcodes using a dot-matrix printer and stick it on merchandise to automate retail outlets to this day, when shops have radio based perimeter fencing which talks to a smartphone app and delivers deals on the shoppers mobile phone.
As the president of Tally, he heads sales and marketing and was instrumental in setting up the company’s partner network which has now proven to be the company’s most potent weapon against the entry of multinational companies which have recently entered the market. We caught up with him last month to understand a thing or two about software products and building to last. Tally has over 7.5 lakh licensed customers but if you include the unregistered ones, its easily over 20 lakh, estimates Ahmed. Here are some lessons from the Tally story:
1. Many companies have developed business management and accounting software and gone after the small and medium user. How does Tally maintain its leadership. What can entrepreneurs emulate?
There a few key elements to it. Firstly, the sharpness of the delivery of the product. The ability to deploy and start using the product within 60 seconds, even when you are early in your product life cycle is key. For Tally in the beginning, while functional capabilities were limited, it was easy to deploy.
Secondly, the ability of the customer to intuitively use the product. I could go on about this.
The next element, is the simplification of customer engagement while he or she is making a buying decision. The product must be clear about delivery and the pain point it solves and there should be no confusion when it comes to pricing. We used to have a simple pricing. There was no opportunistic pricing (per seat licenses) when we launched. That’s because once the customer wants the product, it should be easy to make the buying decision. They shouldn’t worry anymore about what happens when I grow bigger than the 10 seat license I have. It all comes back to productization.
2. What’s next when you scale up?
As customers grew, the next issue is how do you ensure that the entire ecosystem which includes education institutions, chartered accountants etc continue to recommend Tally. Word of mouth is a very powerful method and if you want to make everyone succeed, it becomes effective. The sales and marketing needs to be designed in that way. This means creating a strong backend as well so that its easy to work with partners and the field sales team.
3. What’s unique about the Indian market?
Indian market is a reach-out market. That is, people will buy from a trusted vendor and they want someone to come and install it for them. Keeping these in mind, we developed a robust partner system where even if someone comes online and buys, the partners still get a commission. Because the customer has finally come to buy because the partner has worked in the market.
Constantly updating the product is also important.
4. How does cloud computing change the game?
For a customer, it doesn’t matter. The whole world is moving to the cloud. But what is right for the customer? As far as Tally is concerned, one of the first problems we solved was deployment. Most companies are now using cloud to make deployment easy. But thats something we already dealt with.
Many companies that offer cloud, the cost of license is high. We priced it in such a way that everyone should be able to afford it. We also offered the customer a rental per month license. So those were already available when cloud came along.
Yet, three years ago, we launched Tally.NET, our cloud based solution. This will help customers to access data from anywhere or on multiple devices. For instance, a Chartered Account can work from his home or office to audit a company. More than half of our users have already signed up for the cloud product.
5. What was your entrepreneurial journey like?
My journey as a startup? Desperate (laughs).
That was the time when PCs were launched. That was the year of inspiration that software will be the next big thing. There was an opportunity to develop a software for a customer who was ready to pay for it. Mine was a pure customer funded journey. It was an accounting software till Tally came and wiped us out (laughs). Vedha Automations Pvt Ltd, our company was sold to Tally. We started the product called Shoper.
It was in 1990. We focused on retail more as a strategic reaction to Tally. When they came and took the accounting space, we realised that there was no point competing here. Retail wasn’t addressed by anyone there. We were the first to bring barcoding, first to bring Point of Sale machine and we innovated on every product. Those days we printed bar codes on a dot matrix printer. My first customer was Prestige, when they were just moving to real estate. He had garment and textile retail shops at that time. My first corporate customer was Madura Garments. In 10 years, before they grew big and put in SAP, we were handling all their systems. So we had a deep understanding of the entire supply chain and productizing retail. Today, Shoper is still on the Tally site.