More than India Inc.
Prof. Vijay Govindarajan
THE VITALITY of its democratic institutions, forward-looking policies and wealth of manpower combine to provide India the edge over its classic economic rival, China, in the march to economic growth for the next 25 years, says Vijay Govindarajan, an acclaimed strategy expert from the Tuck School of Business, Dartmouth, U.S.
Terming this period as one of the `most exciting' in the country's 5000-year-old history, Prof. Govindarajan sets out to explain why he is `bearish' on China.
Though China at present is ahead in economic development, its "case is clearly overstated." China may have registered a GDP of 10 per cent, but the country is also home to huge proportions of illegally produced goods. "Take that away and the actual GDP figures might look leaner," says the Founder of the William Achtmeyer Center for Global Leadership, Dartmouth, who is in Chennai on the invitation of the BPO firm, Lason India.
The other hurdle that China could face in its march to economic glory in the years ahead is its political infrastructure. According to Prof. Govindarajan, single-party rule is an unlikely sustainable model for economic growth. "Whatever be India's weaknesses, its people enjoy the ultimate freedom of making or breaking a Government."
"But, having said that one must underscore the fact that a lot more requires to be done for India to realise its potential. Improvement in infrastructure, rural development and more customer empowerment are a few of the things to be addressed," said the strategy expert.
For someone who wanted to divide his time equally among teaching, research, consultancy and vacationing, academics provided the right quotients. With a book on globalisation behind him, another work on innovation is due to be brought out by the Harvard Business School in September.
The four operating principles that he relentlessly advocates in B schools abroad are a passion for whatever one does, readiness to learn something new, keenness to lift the aspiration of his audience and a healthy respect for his students.
Innovation, he says, could hold the key to the development effort. "The BPO, which is essentially a cost arbitrage game, fell into our lap. The challenge is to take it to the next level in terms of quality, value addition and competitive cost structures," he said. Indian companies need to encourage critical thinking and participation of employees, he feels
According to Prof. Govindarajan, all companies cope with what he calls the three boxes- the first involving managing the present, the second selectively abandoning the past and third creating the future. He deconstructs strategy as dealing with the second and third boxes without losing focus of the first. Given the rapid pace of change, companies need to plan short-term actions within the framework of a broader long-term vision, he says.
M. Dinesh Varma
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