Is India an Elephant?

India; is it a Panda, Peacock or a Tiger or any other animal? This was the topic of discussion at this year’s India Business Conference at the Kellogg School. My answer, I guess it depends on your individual perspectives and experiences.

But a bunch of business folks at the conference unanimously called India an Elephant. This begs the question of what did businessmen/women find so elephant like about India? Is it its enormous size that makes it a difficult place to do business in? Or is it its strength that is represented in some of its business houses like the Tatas or Ambanis. Some people commented on the mental ability or capacity of the elephant as being indicative of Indian businesses, while some hinted that once in rage no one can stop the elephant from storming and moving forward.

It brings to mind an old joke or idiom where 4 blind friends touch different body parts of an elephant and describe it as a snake, a wall, a tree trunk and a rope analogous to its trunk, skin, feet and tail.

While some people like to call India, a country of contradictions, C.K.Prahalad interestingly enough re-positioned it as a Kaleidoscope. Whether you are a blind person touching an Elephant or have 20-20 vision looking through a kaleidoscope, India is definitely a land of growing business opportunities and innovations.

The conference I attended on Saturday discussed exactly why this was the case about India and Prahalad opened the forum with some fine examples and ideas to make the case in point.

What is the Indian market like and how do its consumers behave?

· 2/3 rd of the population lives in poverty = Base Of Pyramid (BOP)

· Markets are unorganized and inefficient

· Diverse religious and cultures

· By 2025, 300 million new workers. But out of 100 Indians, 70 complete primary education and only 7 graduate = large unskilled workforce

· 60% of the total population is <30 old = " aspirational">

Traditional business processes and products do not easily transplant and work in India. For example, take the picture of the Elephant.

This is an example of a distribution system that the election committee of India is using to distribute electronic polling booths to the far regions of India. Impressive!!

Therefore, to do business in India, traditional business models must change. How? Prahald provided some different points-of-view (POV) on how to do this.

Different POV #1

Price - Profit = Cost, versus the traditional method of Cost + Profit = Price

Different POV#2

Value equation for emerging markets has to change (see figure)

Different POV #3

Innovation sandbox => Embrace the constraints of emerging markets

Different POC #4

Investment capaicty doesn't come from money only, but should also come through increasing collaborative capacity.

The conference was entirely targeted towards MBA students only. Other speakers included T.N. Balaji from ITC Ltd. who talked about e-Chaupal and another interesting Agri-business concept that has also been successfully implemented by ITC, and CEOs of Future Group, Bharat Forge, etc.

Check out the conference website for more information: http://www.kellogg.northwestern.edu/News_Articles/2009/indiabusinessconference.aspx