In the wake of the coronavirus crisis and the unforeseen financial impact, Modi Enterprises has taken to zero-based budgeting to curb unwarranted expenditure, said the conglomerate’s Managing Director Samir Modi.
Talking to IANS, Modi also said that the group has postponed several of its major expansion and other corporate plans to the next financial year on the back of the disruptions by the pandemic.
On the need for change in strategy by businesses, Modi said strategies and working models would have to change now on and the group has accepted the changes.
“We have to reset and relearn ourselves,” he said. The founder of 24SEVEN, Modicare and Colorbar also said that work-from-home would be a major focus for the group wherever feasible.
“We have instituted zero-based budgeting process which we never did before. Basically zero-based budgeting process is that you take all cost as zero, you realign the cost and then you cut out all cost that is not needed to be done and all managers have to justify the cost they have put into the budget,” Modi said.
Zero-based budgeting allows top-level strategic goals to be implemented into the budgeting process by tying them to specific functional areas of the organization, where costs can be first grouped and then measured against previous results and current expectations. It can help lower costs by avoiding blanket increases or decreases to a prior period’s budget.
In an interaction with IANS, Samir Modi also stressed on the significance of work-from-home going ahead and said that Modi Enterprises would look to adopt remote operations wherever possible.
He said that working from home may become a major factor and companies, including his, would have to ensure how e-learning, e-business compensates for coming to work. Modi noted that six months ago he would have been averse to the idea of work-from-home but now it may be a major feature in the group’s operations.
“A lot of rethinking would be required,” he said, while speaking about the need to align the operations and working environment to the social distancing norms.
The entrepreneur further informed that the home delivery would be major focus with 24SEVEN convenience store chain already rolling out the services in select places. The chain has tied up with Swiggy, Zomato and Dunzo and several of the stores have themselves taken to home deliveries.
Emphasising the need for the significance of the essential goods segment, he said that essential items will be a major segment in 24SEVEN and Modicare, irrespective of the pandemic subsiding. “Because people will be more conscious of safety and health and that will continue,” he said. He added that Colorbar is also coming up with essential items.
Speaking on the implications of the pandemic on expansion and other corporate plans, he noted that several plans and their executions have been postponed till the next fiscal due to the recent disruptions.
Modi said that the cosmetics brand Colorbar recently acquired a proprietary company in Paris and the revamp of the acquired brand has been put on hold.
Further, the company’s plan of expanding the 24SEVEN network to Bengaluru in the south also has been postponed to the financial year 2021-22, he told IANS. (IANS)