To Sid Khanna, managing partner, Andersen Consulting, however, "the issue is simply one of running a tight business." Implement rather than theorise, and go in for quick fixes -- Indian companies are not doing that, he says. Yes, the government is to blame, but organisations can look inward, and improve between 5 per cent and 15 per cent in spite of everything. A global recession has struck, but things will not improve with just a cyclical upswing: fundamental processes have to be attacked, he warns in an exclusive interview with The Financial Express.

Do you think this recession is globally-linked?

Of course it is. If wewere still isolated completely, with people waiting seven years for scooters, it could have been otherwise. But Indian companies themselves are also responsible for what is happening, they have neglected consumer aspirations. Insufficient skill in demand forecasting has resulted in the setting up of huge excess capacities. There are huge inefficiencies, banks are worried about their non-performing assets. This crisis is not directly linked to south-east Asia, but the global crisis has made matters worse for Indian industry, because the anomalies are coming to the fore.

Does management theory have answers to their problems?

It is not a matter of theory, it is simply a matter of running a business tightly. Yes, theory adds a little perspective, but essentially the companies have to get down to implementing strategies to grow.

Do you agree with the tremendous criticism of the government for holding up its own restructuring and implementation of infrastructure reforms?

I think there isexcessive blame on the government. True, a large proportion of blame does lie with the government: they have not been able to administer the interest rate well enough, nor implemented infrastructure, but the private sector itself is inefficient, and there is not enough attention paid to the fact. The private sector can still grow much more than it is doing currently.

How inefficient is Indian industry when placed on a global scale? Is there any other country which shows comparable inefficiencies?

China shows some of these inefficiency characteristics, but is still growing far, far faster than India. The World Economic Forum ranking is a good indicator: it places India 41st out of 45 countries. We will continue to be uncompetitive till we rectify our lack of training, education.

Do you think the attitudes of family-led groups are changing?

Without doubt, they are. They are much more willing to move, adapt to new ideas compared to 10 years ago. But the penny has not dropped yet, they arestill not fully conscious of the need to increase efficiency much more.

What are the main problems with the private sector companies?

Not many companies understand what the needs of the consumers and customers are. They are not close enough to the consumers, they have to focus far more on the areas of sales, distribution, customer needs, their taste etc. I am confident we can walk into any company today and increase its efficiency at least 5 to 15 per cent.

What do you think of the latest trend of companies rushing in for enterprise resource planning and supply chain management software packages?

Yes, companies are putting in software, making changes. But there is generally a quickfix mentality to all this, they must attack fundamental processes much better.

Sometimes, it is alleged that management excellence is not being translated into shareholder value addition simply because of the lack of depth and resultant immaturity and volatility in the Indian stock market. Do youagree?

No, I do not think so at all-if you look at the share price performance of multinationals versus that of Indian companies, you see a gap that tells the story. No, Indian companies have simply got to do better, recognise their competitive advantages.

What is the Indian competitive advantage?

I think Indian competitive advantage is in intellectual capital. We have not done enough on that count. Some industries are doing it -- software, for example. Infosys is doing very well, TCS is doing excellent work at one level, but more needs to be done -- we need much more of companies like TCS, Wipro, and HCL.

So do you think this recession will end through a normal cyclic upswing?

No, this is not a normal cycle. There has to be actual improvement in efficiency, and the government has to take a few steps as well. The efficiency of banks has to be improved, the headcount in that sector is absolutely excessive. The government must identify some sectors, such as housing, and spur them topush demand.

How can Indian companies best use you?

First things first, we are not a boutique management consultancy which only provides advisory services. We stay and implement. The best way is to work with us in a diagnostic phase, where we work out a journey map for the company, which will yield strategies that lead to domination and survival in business. We shall help in adequately focussing strategy. Then we can stay with the company and help implement the whole process. The more important area where we can come in and help is to improve profitability.