Reflection- Storytelling

Challenge and Selection:

Storytelling is one of the most effective ways to promote an idea that can be understood by the

masses. It helps the person who one is communicating with to learn from a real life scenario that

you talk about through your storytelling.

Storytelling has played a central role in the process of human communication for a very long

period of time. Be it in the form of small anecdotes or lengthy stories, they have all been

extremely helpful in making people better understand situations. Storytelling helps people

connect with the story on another level as they can truly visualise what happened in the story

themselves and learn at the same time.

The challenge faced by me was one where I had to make use of storytelling to explain to the

stakeholders the consequences of taking certain actions. Thus I explained our situation in the

form of a story.

Application:

I was a senior partner in my firm and we were looking for ways to be able to expand our market

presence. The best solution that we reached was to acquire another company that was present in

the market and to take over its market presence as well. The valuation they assigned to their

business was almost 9 times the value that we had assigned to them but we were desperate and

the CEO was willing to make the acquisition of the company nonetheless.

That was when I had to step in and explain to them about how that was not the right decision to

be made at that moment. I explained how we had reached that level of valuation for the business

after closely taking a look at their financial books and based on our findings we saw that the

profits of the business were now stagnant. That is, they were neither increasing from the previous

year, nor decreasing. Then I went ahead to make more of a point by narrating a similar story.

I went on to explain our situation by means of storytelling. The story of Nortel, who had its value

increase ten-fold from its beginning to its peak in the year 2000. As a result of this, they went on

to make several acquisitions. Most of them at valuations higher than their actual stock price.

They bought dozens of small technological companies and the most notable of them was Bay

Networks for $9.1 billion. The market cap of Nortel also went on to increase over time to around

$283 billion, however, their stock price began to plunge and it fell all the way to $5 billion by

2002. People considered the reason behind this downfall to be the acquisition of Bay Networks at

a grossly high valuation.

Insight and Approach:

I made use of this story of Nortel to explain to the CEO of the business and the other partners

how the acquisition of another business at a higher valuation was not the right approach for it

may come back to haunt us in the future, especially considering the fact that the same happened

to a company that was in a position that was very similar to ours. Thus, I was able to make use of

storytelling as a tool and applied it to one of the biggest challenges that my firm and I faced. I

used the means of storytelling to overcome this challenge.

