What do you make of the happenings in Europe
Economists never agree with me on this, but the biggest driver of the economy is our psychology. When journalists in the US and Europe go negative, it scares the average person and slows down his spending. But businesses are making record profits. Our business, for instance, is up 15%, both in the US and globally. Very few CEOs are ready to take risks, and most get scared easily. There are close to 49 corporations in the world, and most of them are risk averse. Greece is just a speck in the global economy.
But economists go by data, and data shows there is a slowdown.
Yes, they have been negative for a while, but economists never predict turnaround, either. The next ten years are going to be exciting than ever for the global business.
What makes you say that
Look at the underlying technologies, things that economists dont mention like common communications systems around English, or Facebook or trends on internet. I can find a supplier from around the globe in an instant. This means a total productivity change. We feel there will be total transformation in the industry automotive, aerospace, chemicals, healthcare. So, many disruptive market trends happen at the same time, its impossible to predict what the future will look like. Who could have predicted Google, Facebook or GPS In India, the internet and telecom are empowering the growing middle class.
India has been slow on innovations. What could be the missing link
Globally, there is a mindset that Asia doesnt innovate and does not have the cutting edge. But look at what China did in the Olympics in athletics, or in gymnastics, a sports I did in school. They have been innovative. So has India, with its IT industry, an example other industries can emulate.
In IT, we have more of an innovative business model than innovative technology or product. We still dont have a Microsoft...
I wouldnt call Microsoft innovative, but they invested in competitive strategy. Innovation can be in service, strategy or business models. There is so much passion and inspiration in this economy, and industry leaders like Tatas, HCL and Wipro are setting the tone. No one ever predicted California will become a hot-bed of technology. The same thing will happen here. India has a hunger for success.
What are the lessons for Indian companies, at a time when there is high domestic demand, but a slowdown elsewhere
Indian firms should not get satisfied with the domestic market. My advice to Indian companies would be to develop a global brand and generate global demand. India is yet to have best practices in marketing. They need to have a global mindset, and unique positioning systems and strategies. In Germany, in the 80s and 90s, a number of domestic engineering firms disappeared since they could not fit into the global frame.
How can companies that have invested hugely in US and Europe, or export to these places tackle the slowdown
In some cases, companies are too dependent on partners. That could change. India has a huge advantage in terms of cost and productivity. Sectors like healthcare, transportation and telecom are wide open and could change in the next ten years.
Which is a successful company
One where investors would be prepared to put their money into, one that has unique positioning strategy in the world, or a blue ocean strategy. You also look for the visionary innovative outlook from the CEO.
Do you see Indian companies and CEOs fit into this criteria
A lot of them do. Some companies US are not curious, not looking out of the box. They are in a comfort zone. Thats probably what put GM in bankruptcy.
How can Indian firms go beyond the numbers and tap opportunities better
Its tough. Comfort zone makes people arrogant, and blind to opinion. Most companies start protecting their growth margins. I should be able to find a product that can replace my existing one. Google, for one, is looking at something new that can kill its old search engine. They may burn a lot of money, but they are thinking out of the box.