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By:

Rashmi Kulkarni

23 March 2025 at 2:58:52 pm

Loss Aversion Is Why Your Good Idea Fails

Your upgrade is their loss until you prove otherwise. Last week, Rahul wrote about a simple truth: you’re not inheriting a business, you’re inheriting an equilibrium. This week, I want to talk about the most common reason that equilibrium fights back even when your idea is genuinely sensible. Here it is, in plain language: People don’t oppose improvement. They oppose loss disguised as improvement. When you step into a legacy MSME, most things are still manual, informal, relationship-driven....

Loss Aversion Is Why Your Good Idea Fails

Your upgrade is their loss until you prove otherwise. Last week, Rahul wrote about a simple truth: you’re not inheriting a business, you’re inheriting an equilibrium. This week, I want to talk about the most common reason that equilibrium fights back even when your idea is genuinely sensible. Here it is, in plain language: People don’t oppose improvement. They oppose loss disguised as improvement. When you step into a legacy MSME, most things are still manual, informal, relationship-driven. People have built their own ways of keeping work moving. It’s not perfect, but it’s familiar. When you introduce a new system, a new rule, a new “professional way,” you may be adding order but you’re also removing something  they were using to survive. And humans react more strongly to removals than additions. Behavioral economists Daniel Kahneman and Amos Tversky called this loss aversion where we feel losses more sharply than we feel gains. That’s why your promised “future benefit” struggles to compete with someone’s immediate fear. Which seat are you stepping into? Inherited seat:  People assume you’ll change things quickly to “prove yourself”. They brace for loss even before you speak. Hired seat:  People watch for hidden agendas: “New boss means new rules, new blame.” They protect themselves. Promoted seat:  Your peers worry the old friendship is now replaced by authority. They fear loss of comfort and access. Different seats, same emotion underneath: don’t take away what keeps me safe. Weighing Scale Think of an old kirana shop. The weighing scale may not be fancy, but it’s trusted. The shopkeeper has used it for years. Customers have seen it. Everyone has settled into that comfort. Now imagine someone walks in and says, “We’re upgrading your weighing scale. This is digital. More accurate. More modern.” Sounds good, right? But what does the shopkeeper hear ? “My customers might think the old scale was wrong.” (loss of trust) “I won’t be able to adjust for small realities.” (loss of flexibility) “If the digital scale shows something different, I’ll be accused.” (loss of safety) “This was my shop. Now someone else is deciding.” (loss of control) So even if the new scale is better, the shopkeeper will resist or accept it politely and quietly return to the old one when nobody is watching. That is exactly what happens in companies. Modernisation Pitch Most leaders pitch change like this: “We’ll become world-class.” “We’ll digitize.” “We’ll improve visibility.” “We’ll build a process-driven culture.” But for the listener, these are not benefits. These are threats, because they translate into losses: Visibility can mean exposure . Process can mean loss of discretion . Digitization can mean loss of speed  (at least initially). “Professional” can mean loss of status  for the old guard. So the person across the table is not debating your logic. They’re calculating their losses. Practical Way Watch what happens when you propose something simple like daily reporting. You say: “It’s just 10 minutes. Basic discipline.” They hear: “Daily reporting means daily scrutiny.” “If numbers dip, I will be questioned.” “If I show the truth, it will create conflict.” “If I don’t show the truth, I’ll be accused later.” In their mind, the safest response is: nod, agree, delay. Then you label them “resistant.” But they’re not resisting change. They’re resisting loss . Leader’s Job If you want adoption in an MSME, don’t sell modernization as “upgrade”. Sell it as protection . Instead of: “We need an ERP.” Try: “We need to stop money leakage and order confusion.” Instead of: “We need systems.” Try: “We need fewer customer escalations and less rework.” Instead of: “We need transparency.” Try: “We need fewer surprises at month-end.” This is not manipulation. This is translation. You’re speaking the language the system understands: risk, leakage, blame, customer loss, cash loss, fatigue. Field Test: Rewrite your pitch in loss-prevention language Pick one change you’re pushing this month. Now write two versions: Version A (your current pitch): What you normally say: upgrade, modern, efficiency, best practices. Version B (loss prevention pitch): Use this template: What are we losing today?  (money, time, customers, reputation, peace) Where is the leakage happening?  (handoffs, approvals, rework, vendor delays) What small protection will this change create? (fewer disputes, faster closure, less follow-up) What will not change?  (no layoffs, no humiliation, no sudden policing) What proof will we show in 2 weeks?  (one metric, one visible win) Now do one more important step: For your top 3 stakeholders, write the one loss they think they will face  if your change happens. Don’t argue with it. Just name it. Because once you name the fear, you can design around it. The close If you remember only one thing from this week, remember this: A “good idea” is not enough in a legacy MSME. People need to feel safe adopting it. You don’t have to dilute your standards. You just have to stop selling change like a TED talk and start selling it like a protection plan. Next week, we’ll deal with another invisible force that keeps companies stuck even when they agree with you: the status quo isn’t a baseline. It’s a competitor. (The writer is CEO of PPS Consulting, can be reached at rashmi@ppsconsulting.biz )

Bangladesh’s Unraveling: The Silent Hand and Its Ramifications for India

In August 2024, the Bangladesh government led by Prime Minister Sheikh Hasina was ousted, ostensibly by mass student protests. Yet, the true story of her removal is far more complex—and insidious. Behind the façade of unrest lies the latest casualty of U.S. regime change operations, a move crafted with chilling precision. This strategy, a real-world manifestation of Sun Tzu’s dictum that “The greatest victory is that which requires no battle,” demonstrates the subtle, often invisible hand of geopolitical manipulation.


Regime change, historically, is a tactic employed by powerful nations to engineer shifts in government that align with their strategic interests. These changes—whether executed through revolution, coup, or the establishment of new ideologies—are often justified under the banner of promoting democracy, maintaining geopolitical stability, or fighting terrorism. However, the U.S., the self-proclaimed champion of democratic ideals, has repeatedly shown a penchant for supporting autocrats when it serves its interests—examples abound, from Indonesia’s Suharto to Pakistan’s Pervez Musharraf, not to mention the ambiguous role it played in the Arab Spring.


The U.S. has a long history of meddling in the internal politics of sovereign nations. Beginning with the annexation of Texas in 1846, American efforts at regime change accelerated during the Cold War and its aftermath. The U.S. carried out more than 60 such operations, often to install governments that would advance its political, economic, and military objectives. Covert methods such as economic strangulation, proxy wars, and even direct military intervention have been employed to orchestrate these shifts. The most notorious example was the CIA’s involvement in the 1953 coup in Iran that overthrew Prime Minister Mohammad Mossadegh, who had nationalized the country’s oil industry. Over the next few decades, the U.S. intervened in dozens of countries, often installing military dictatorships or puppet governments that served American interests. Latin America, in particular, saw a heavy dose of covert operations, including the U.S.-backed coup that ousted Chile’s socialist President Salvador Allende in 1973, and the creation of proxy conflicts throughout Central America.


In the 1980s, the U.S. refined its covert operations through the use of “black operations”—secret military and intelligence activities designed to destabilize regimes or provoke rebellion. These operations were frequently justified under the guise of containing communism, especially during the Cold War.


In recent years, the U.S. has refined its toolkit, incorporating “color revolutions” as a cheaper, more efficient method of destabilization. These operations, often fueled by popular uprisings stoked by local discontent, have been implemented in countries ranging from Ukraine to Venezuela, and now, Bangladesh.


Bangladesh’s recent crisis offers a case study in these tactics. At the heart of the unrest was the involvement of Nobel laureate Dr. Muhammad Yunus, who, with the backing of local political elites and U.S. operatives, became the face of the protest movement. The trigger for the unrest was the government’s handling of domestic issues, but the deeper motive was geopolitical. Sheikh Hasina’s outspoken criticism of U.S. attempts to divide Bangladesh along religious lines—and her firm opposition to the establishment of a U.S. airbase on Saint Martin’s Island—likely earned her the ire of Washington.


U.S. deep-state actors, including diplomats and intelligence agencies, appear to have played a central role in orchestrating the destabilization. This effort culminated in the installation of an interim government—a government that, as expected, is not particularly friendly towards India. The political vacuum in Bangladesh now threatens to spiral further out of control, with ongoing protests and violence, particularly against the Hindu minority, contributing to a dangerous atmosphere of uncertainty.


For India, the consequences are stark. The instability in Bangladesh could lead to a significant influx of refugees, further straining India’s borders and national security.


Already, Bangladesh has rerouted its textile exports through the Maldives, bypassing Indian ports, which has resulted in economic losses for India. On the security front, the risk of increased terrorism along the India-Bangladesh border is high, potentially destabilizing military deployments and affecting counterterrorism operations.


Moreover, the prospect of a government unfriendly to India coming to power in Bangladesh is a grim reality. This scenario could lead to diplomatic friction, particularly if Bangladesh escalates its demands for the extradition of Sheikh Hasina, who has sought refuge in India. At the same time, this situation could offer opportunities for regional adversaries—China, Pakistan, and even the U.S.—to further complicate India’s position, both diplomatically and militarily.


This convergence of challenges—a perfect storm of economic, political, and security risks—requires a comprehensive response from India. A multi-pronged strategy must be developed to counter the growing influence of the U.S.-China-Pakistan axis in the region. India must prepare for the inevitable fallout, both in terms of immediate diplomatic actions and long-term strategic planning. As Chanakya wisely counseled, “Do not reveal what you have thought upon doing, but by wise counsel keep it secret, being determined to carry it into execution.” India must heed these words as it navigates the stormy waters of a destabilized South Asia.

(The author is a retired Indian Navy officer and geo-political analyst. Views personal)

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