Have Indian companies brought anything to the table post-liberalisation, privatisation and globalisation? The Japanese taught us the virtues of value engineering and just-in-time management. It is but natural to ask this question as India Inc. goes on acquiring companies overseas with increasing regularity and force.
Many Indian companies have done much more than just add global businesses to their pool. Many have managed to turn them around. India Inc. has acquitted itself pretty creditably in the world management arena. This is no small achievement given that Indian companies have actually learnt to compete globally 20 years back and in more demanding circumstances than Chinese businesses. Indeed, if Indian companies have learnt anything from 1991 in economic liberalisation, it is the ability to do more with less.
Despite serious infrastructure shortages, the relatively high cost of capital and widespread corruption, Indian companies have been able to deliver considerable value. It would be worthwhile to remember that India's BPO story began when telecom tariffs were out of strike with global rates and telecom infrastructure was awful to say the least. Yet, companies in the West persistently chose to overlook the determined protests of labour unions and outsource larger tracks of business operations to India owing to the absolute value they derived. Striking indication of this can also be seen in India's automobile and auto-components industry. Both notoriously uncompetitive in the pre-nineties, they rapidly reinvented themselves when the obstacles to competition were removed. Today, it is no coincidence that Detroit is looking at the India outsourcing opportunity as a vital piece of their turnaround strategies.
It is this ability to manage against the odds that has given Indian entrepreneurs their USP. It may be too early to suggest that this amounts to a specialist Indian management method. But it is certainly a precious competitive advantage in today's business scenario.
Competitive pressures have become much more concentrated globally, raising the bar on performance and forcing companies to look for more cost-efficient business models. In that context, Indian entrepreneurs certainly have an natural know-how to offer. It was amusing to recall that when Indian companies struggled against the challenges of economic liberalisation in the mid and late nineties, it was fairly common to have many experts attribute profound, spiritual skills to Indian entrepreneurs. That was an era of somewhat well-developed business patriotism when home-grown gurus talked about the management lessons embedded in Indian myths and legends. Lessons from the Mahabharata or Bhagwad Gita were popular sittings in those days when Indian entrepreneurs were trying to find their feet in this new, vulnerable world.
Today, you get to hear less of such theories, not least because Indian entrepreneurs have rooted their ability in a solid, temporal reality. The question is whether this talent of managing in unfavorable conditions can be considered a sustainable advantage. Most of India Inc.'s global turnaround stories are less about stunningly smart strategy as the ability to, say, replace high-cost debt and cut off costs off shop-floor processes through value engineering.
Traditional wisdom has it that India Inc is a low-cost champion. But as any expatriate businessman who has worked in India for some years will demonstrate, Indian companies are able to deliver much more than just low-cost goods and services. Whether it is in engineering, IT or service-delivery, Indian managements have almost mastered the art of
delivering cost and value.
Though these success stories are splendid, they should only be considered the beginning of the long and winding road up the management value chain. Just as Japan turned its post-war depths and paucity of resources into a stable and sustainable world-beating system, India Inc too needs to find its management USP.
Source: Rediff 2006
The basic idea has been taken from the source indicated. But it has been thoroughly edited and brought in tune with the present time.
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