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Madhukar Sabnavis: 'The Indians are coming'

Madhukar Sabnavis  |  New Delhi 

How equipped are Indian companies in taking on the world.
In 1992, JRD Tata said, "I don't want India to be an economic superpower. I want it to be a happy country ... Even when I go up, I'll come back to see what is going on in India."
More recently in an interview, R Gopalakrishnan said, "I have sat in on meetings where a CEO says he would like to buy 50 per cent of a company abroad and the chairman (read Ratan Tata) says why not 100 per cent."
The dream of a large private sector group in India, the Tatas, has come a long way in a decade. From being a happy Indian, it now wants to be a happy but global Indian.
We are into the third phase of Indian economic development. First, we witnessed the "wave of self-sufficiency" when we proved to ourselves that "we can do things ourselves". Then in 1991 we witnessed the "wave of liberalisation". We saw the emergence of new categories and a quantum upgrade in the quality of existing products and services as they competed with global brands that invaded India. We are now moving into wave three""the "wave of globalisation" where Indian companies and brands are exploring foreign shores to compete and beat the best there.
Consider some statistics. In the first three quarters of 2006, Indian companies announced 115 foreign acquisitions with a total value of $7.4 billion""almost as much as foreign firms invested in Indian purchases and up from just $1 billion in 2000! These investments are across sectors from information technology to outsourcing to liquor. Wipro has acquired companies in Portugal, Finland and California. Ranbaxy has bought Ethimed of Belgium and Mindogen, the Spanish generics arm of GSK. Bharat Forge has bought six companies in four countries""Britain, Germany, Sweden and China. Suzlon bought Hansen, a Belgian gearbox maker. UB has made an unsolicited bid for Whyte and Mackay, a Scottish distillery. And yes, this has all been crowned by the most recent acquisition of Corus, a larger Anglo-Dutch rival by Tata Steel. Clearly, the Indians are coming and the question to ask is, are we ready for the battle in the global arena? Are we ready to be multinational? What are our inherent strengths and what do we need to watch out for?
There are, to my mind, strong cultural barriers to Indian businesses going global. Historically, India has not been an "invading culture". While we have always traded and communicated with the world, the drive to go out and "dominate" outside cultures has never existed. In fact, there have been few Indian rulers who actually tried and succeeded in ruling the whole of India. The British were the first ones to successfully do that!
Similarly, Hinduism as a religion has remained highly restricted to the peninsula for much the same reason. A basic lack of global ambition can be a restriction to our dreams and our pursuit of the same. Unlike much of the West and Japan, we do not have domestic limitations to business growth; so the drive to go abroad has to come from within rather than from the environment. Failure first time could mean retreat for an Indian business""while for smaller western and Japanese businesses there is no option but to carry on regardless.
Further, we need to guard against our natural tendency to fall back into a chalta hai attitude. As a culture, we are people who get "contented (santoosht)" very easily. And as consumers we are very "forgiving"""not setting high standards on the quality of products and services""keeping our expectations low. Consider the Indian cricket team. Player to player we are as good, if not better, than the best""the Australians. However, somewhere defeat""being second-best""doesn't hurt us as much as it perhaps does the Australians. So even if we come out Number 2, we are quite satisfied. We just lack the killer instinct.
As we move out and ahead, we must not forget that "good is the enemy of great" and in the new world "being good is simply not good enough". God is in the detail. Finish, packaging, precision, style, service standards""these are elements that will make or break a purchase decision. Unfortunately these are things we, Indians, are generally not conscious about.
Is anything working for us?
If multinational means operating in many geographies outside the "country of origin", then Indian companies have just begun their journey. However, if it means dealing with multiple cultures and doing business successfully, then the best Indian companies have been doing it for years. India is a continent within a country""with so much social, cultural, religious and economic diversity. Successful Indian businesses have learnt to manage this diversity for years. The only thing Indian businesses need to do is to draw on this experience and carve a place for themselves on a larger canvas called the world.
As multinationals take brands across borders, we must remember companies and brands take a part of their "country of origin" with them. The Japanese are about a sense of perfection and aesthetics which is reflected in brands like Sony and Honda; Germans are about the spirit of engineering excellence and that's what Mercedes and BMW are all about; the French are about exquisite style and fashion and that's what Louis Vuitton and Pierre Cardin reflect; and the Americans are about energy and optimism and that's what Coke and Pepsi are all about.
To me India is more than an English-speaking country with educated intelligent IT professionals. Dig deeper and you will find a race:
  • that has learnt to live with diversity;
  • whose people have learnt to adapt, adopt and assimilate new practices;
  • a race which welcomes outsiders with open arms and a warm heart;
  • people who are willing to change and live with change every moment;
  • people who can live with odds against them and still smile;
  • people who are emotional and enjoy everything quite boisterously.
  • So if this were to be distilled down to values, it would be: simple, expressive, warm, down-to-earth and intelligent. These are values businesses and brands can take with them. Interestingly, as products move into service and experience, these values could give Indian businesses a natural advantage!
    Finally, to be a true global player, we need more Sachin Tendulkars rather than Shah Rukh Khans. It's not enough to appeal to the Indian diasporas, but critical to build stature in global markets that makes locals look up to you. That's the real challenge. Something worth thinking about.

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    First Published: Fri, November 03 2006. 00:00 IST