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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 )

The Boy Who Would Not Bow

A forgotten martyr from Sialkot whose defiance shaped the soul of Punjab.

The year was 1734. In the town of Sialkot, nestled in what is now Pakistan, a twelve-year-old boy named Haqiqat Rai stood before a Qazi, accused of blasphemy. His crime? Winning a debate.


Born into a prosperous Hindu Khatri family, Haqiqat was the son of Baghmal Puri and Durga Kaur. Like many children of his class and time, he was enrolled in a local maktab to study mathematics, Persian history and astronomy - subjects considered essential for upward mobility. The maktab was presided over by a Maulvi, and the classes were mixed: Hindus and Muslims sat side by side, sharing slates and inkpots, and sometimes, unspoken rivalries.


Haqiqat was precocious. He grasped algebra with ease, recited Persian couplets fluently, and had an eye for the stars. His athleticism only added to the resentment of the older boys whose academic thrones he dethroned. One day, after besting his seniors in a mathematical dispute, their wounded pride sought a cruel recourse. They alleged Haqiqat had insulted Islam during the argument.


The Maulvi, perhaps eager to rid the school of its most troublesome prodigy, referred the matter to the Qazi. The Qazi, Abdul Haq, declared the boy’s words blasphemous and presented him with a grim ultimatum: convert to Islam or face punishment. Haqiqat, all of twelve, refused. His calm, unwavering refusal startled the court.


The case was escalated to the local administrator, Amir Beg, who prescribed a brutal punishment: Haqiqat was to be hung by his feet from a tree and beaten until he relented. His father, leveraging both wealth and influence, intervened to delay the sentence. A bribe bought the boy time and a transfer of the case to Lahore, where the Governor of Punjab, Zakariya Khan, would serve as the final arbiter.


Zakariya Khan, known for his relative moderation, initially dismissed the charges after hearing the boy and his accusers. But Lahore’s clergy were not satisfied. Stirred by sermons and rumours, a mob began to gather outside his residence. The pressure mounted. Liberalism, in the face of a wrathful orthodoxy, withered.


Haqiqat was summoned once again. This time, Zakariya Khan reversed his earlier judgment. The child, he declared, was indeed guilty. Conversion was his only escape. But Haqiqat stood unflinching. He spoke of his Sikh heritage. His maternal grandfather, Kanhaiya Singh and uncle, Arjan Singh, both martyrs. He cited the valour of Guru Gobind Singh, of Baba Banda Singh Bahadur and of the Sahibzadas (Guru Gobind Singh’s youngest sons who were bricked alive, ages seven and nine, for refusing to convert).


Zakariya Khan tried persuasion. He offered Haqiqat a Mansab, a princely stipend, a life of ease. The boy laughed. Bribing a Sikh, he said, was an exercise in futility.


Infuriated, the governor ordered a public execution.


The following morning, Haqiqat was buried waist-deep in the ground. Stones were handed out to the crowd. With each blow, he was asked, “Will you convert now?” Each time, his answer: No. His lips moved ceaselessly in prayer. According to lore, even after his beheading (mercifully delivered by a soldier who could no longer bear the sight) his severed head continued to chant the name of Ram.


His body was retrieved by Lahore’s Hindu and Sikh residents. A samadhi was built, and every spring, the site became a locus of remembrance, an emblem of resistance, of identity, of dignity in the face of imperial cruelty.


Haqiqat Rai’s martyrdom did not languish in obscurity. Decades later, a young Ranjit Singh, inspired by the story of the fearless child, would establish the Sikh Empire in 1799. He would call the boy Haqiqat Singh Puri, bestowing upon him a posthumous honour. The empire he forged stretched from the outskirts of Delhi to the edges of Afghanistan and Tibet, pushing back the frontiers of Mughal dominance.


In contemporary Pakistan, especially in Lahore, Haqiqat’s name is now largely unknown. Efforts have been made, even by influential dailies like Nawa-i-Waqt, to disassociate public festivities from the memory of this boy, casting him as a political inconvenience rather than a spiritual phenomenon. Yet, in quiet rituals performed across Punjab, his story survives.


History rarely makes space for children. It tends to focus on emperors, generals and treaties. But every so often, a child likeHaqiqat Rai shatters that hierarchy - not with violence or political strategy, but with the sheer force of moral clarity.


At twelve, he made a choice most adults would shrink from. And in doing so, he did not just preserve his faith but immortalized it.

(The author is a political commentator and a global affairs observer. Views personal.)

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