The attractive figure needed a fuller commercial account

The combined margin hid the service deficit I had accepted

In 2022 Sahana Lemqori challenged the way I reviewed equipment-and-service bundles. Across thirty-six contracts, the selected equipment account showed ₹6.8 crore revenue and ₹6.3 crore direct cost. The associated service account showed ₹1.2 crore revenue and ₹1.7 crore direct cost. Equipment therefore contributed ₹50 lakh before central overhead, while service consumed ₹50 lakh. The combined ₹8 crore revenue matched ₹8 crore direct cost. I had treated the combined presentation as a tolerable commercial position without asking how the continuing obligation would be funded after the installation transaction.

The sales lead argued that customers preferred one proposition and might resist a separately stated service price. That was a real concern: breaking up the offer could make comparison harder and expose us to competitors willing to promise more. Sahana wanted a scope that the operating team could resource. I supported a ₹91 lakh redesign of the service proposition, commercial records and renewal process. Finance retained responsibility for the cost account, while qualified technical owners defined the work actually offered. We did not retrospectively change existing obligations simply because the review had made them inconvenient.

At the review date, twenty-two of the thirty-six renewals had been agreed with separately stated service scope, eight had narrower arrangements and six remained pending. Those counts did not establish a profit improvement or represent thirty-six completed cash collections. The cost of the redesign remained an expense, and the narrower arrangements required customers to make choices they had previously assumed were included. We also avoided attributing changes in cinema activity to our commercial intervention. The reviewed contracts formed a specific population, not the whole industry's economics.

My error was accepting a combined number as a sufficient explanation of the business. I would now ask what each component commits the company to do, over what period and with which resources, before approving the offer. Bundling can remain a useful customer proposition. It should follow an understood service account rather than conceal the absence of one. The chief executive must make that distinction matter in the plan, including when a more explicit offer makes the next sale harder.

Replacing an all-model promise with a supported transition account

A 2023 renewal review covered eighty-four cinema screens using an older equipment family. Commercial colleagues wanted to retain a broad support description because customers depended on the installations and replacements required planning. The qualified technical team could not support the same promise across every screen. Component availability, system condition and the appropriate scope differed. I asked for a screen-level account before the company renewed a statement whose breadth exceeded the evidence behind it.

The review identified fifty-two screens with a supported migration proposal, twenty that could remain within a defined existing-support scope and twelve requiring further resolution. These were review outcomes. A migration proposal was not a completed installation, and the twelve unresolved screens were not declared either safe or unusable by the commercial team. Sahana coordinated the operating work with the responsible technical and safety owners. Customer circumstances and existing contractual duties still had to be handled through the authorised process.

We approved ₹1.6 crore for the assessment and transition-preparation programme. Sales colleagues objected that the narrower language could encourage customers to seek another supplier, while several cinema owners wanted more time before committing to changes. I supported a differentiated account rather than renew an all-model promise that the service team could not substantiate. Legal and commercial owners addressed the actual agreements; technical staff retained decisions about equipment and methods. The CEO's approval did not substitute for those professional judgements or cancel duties already accepted.

The outcome was a funded programme and a clearer set of next decisions, not a claim that all eighty-four screens had completed a transition. We retained the twelve unresolved cases in the board review and kept proposed migration separate from delivered work. The decision carried expense and a more difficult customer conversation. It did not produce a measured reduction in failures or establish a universal replacement rule for older equipment.

I would begin this review before renewal wording becomes the reference point for the discussion. A customer's dependence on an installation makes careful support planning more necessary; it does not create missing components or qualified capacity. Enterprise leadership must fund the transition conversation while there is still time to offer supported choices, rather than leave the technician to explain the limits after a broad commercial promise has already been renewed.

Declining extra stock despite a larger supplier rebate

In 2024 a supplier offered a larger rebate if our annual purchase account reached ₹12 crore. The supported purchasing plan was ₹9.4 crore, so reaching the threshold required another ₹2.6 crore of stock. The rebate would rise from ₹31 lakh under the planned account to ₹48 lakh at the threshold: an incremental ₹17 lakh. The commercial sponsor emphasised the larger total rebate and the approaching deadline. I initially found the improved headline attractive because it appeared to strengthen an established supplier relationship.

Finance asked that we compare the incremental benefit with the incremental obligation. Sahana's team also examined which items the existing service and installation plans actually required. The additional purchase was not supported merely because it sat in the same broad equipment category. Qualified colleagues retained compatibility and condition decisions. A ₹29 lakh review covered the demand account, commercial terms and stock implications. It did not create a new customer commitment or turn enquiries into firm orders.

We declined the additional ₹2.6 crore purchase and retained the ₹9.4 crore supported plan. The supplier was entitled to keep its incentive conditions, and we accepted the smaller rebate available under the actual arrangement. The ₹17 lakh difference was a benefit forgone relative to the larger purchase proposal, not a loss on equipment already owned. Equally, ₹2.6 crore was an avoided proposed commitment, not cash recovered or a realised profit improvement. We did not claim that the stock could never have sold; the evidence was insufficient to make that quantity our commitment at that time.

The decision disappointed colleagues who had worked to strengthen the account and believed demand would emerge. I asked them to preserve those opportunities as opportunities and return with evidence if they developed. We also kept the ₹29 lakh review expense visible rather than use the declined purchase to present the exercise as costless. The supplier relationship continued on the smaller plan.

Next time I would require the incremental account in the first proposal. A rebate can improve a sound purchasing decision, but its deadline should not choose the inventory strategy. The board needs to know what the enterprise must own, fund and eventually sell to receive the attractive benefit at the top of the page.

Knowing cinema customers did not make us a ticketing company

In 2025 a team proposed a ticketing venture built around our existing cinema relationships. The first-year forecast showed ₹2.2 crore commission receipts, alongside ₹1.7 crore launch spending and ₹90 lakh recurring annual support expense. The sponsor argued that cinema owners already trusted us with important technical work and that an adjacent offer would deepen those relationships. I authorised ₹36 lakh of exploration before any launch commitment, so that customer familiarity could be examined alongside the different responsibilities of the proposed business.

The review considered the service capability, customer support, commercial arrangements and specialist legal and technical work the venture would require. Our equipment teams could not simply absorb those duties because they visited the same venues. The forecast receipts were not signed orders, the launch spending was not recurring expense and the annual support figure did not describe every possible cost. Finance kept those categories separate. We did not present the subtraction of all three figures as a settled valuation or imply that a familiar customer base removed execution risk.

Prakash Qezmari asked what the company would stop doing to make room for the venture. The sponsor preferred proceeding with a small launch, arguing that learning would be faster with an operating product. Sahana pointed to unresolved service-scope work in the existing business and the different customer-service obligations the proposal would introduce. I recommended declining the venture at that point. The board agreed, and the ₹36 lakh exploration cost remained incurred. We did not call the forecast ₹2.2 crore lost revenue or the unapproved launch budget a realised saving.

The decision preserved a clear enterprise boundary: we continued supplying, integrating and supporting agreed cinema systems without becoming a ticket seller. It did not declare ticketing unattractive in every setting or rule out every future adjacent activity. A later proposal would need its own capability and commercial case, rather than inherit approval from this exploration. The team had done useful work even though no product launched.

I would frame that possible outcome explicitly at the start of another exploration. Customer access is an advantage, but it is not a complete operating model. The CEO must leave room to conclude that a different business is interesting and still not the right next commitment for this company.