Indian executives have an employee-centred approach to management with other differences that have worked successfully in managing double-digit growth.
As The India Way suggests, India's different business culture could revolutionise multinational management as India enterprises go global and escape their home markets. The four authors are all Professors at the Wharton School, the University of Pennsylvania’s renowned business school and are well placed to comment on what they call The India Way. During the research for the book they consulted with most of the top Indian leaders of the businesses that underpin India’s recent and continuing success.
The first chapter provides a shorty history of business in India. It explains why and how the business environment has changed since 1991 to produce the recent phenomenal growth in India. The India Way then moves to explore the four main characteristics of management that make up The India Way.
The employee is preeminent in The India Way as business leaders see the corporate and culture and employee morale as being central. This may be due to traditional Indian paternalism, the youth of many major businesses still run by their founders or in older businesses there is still often a dynastic family management. Whatever the driver such Indian businesses invest strongly in their staff at all levels. There is a culture of performance management which when linked with the business culture actually creates the conditions for successful business. It means that employees are not treated as disposable resources as they often are in USA and to some extent United Kingdom.The Need for Improvisation and Adaptability and its Impact on Strategy
Due to the regulation, lack of access to technology and an uncertain infrastructure Indian business managers have long had to be adaptable and flexible. The India Way suggests that this has created a less prescriptive approach to corporate strategy than in the west. There has been a need to try many new approaches to find what works and to quickly drop those that are not working. It creates a focus on broad objectives rather than the overly short term financial target driven culture of western corporations.
India has a huge population with modest means. To serve such customers Indian business has to both very effective and efficient in satisfying an aspiring and demanding market. The India Way results in efficiency and innovative business concepts that give Indian business a strong hand in global and developed markets, especially at a time of widespread austerity.
India business leaders have a strong sense of responsibility to wider society. Again some of it may be due to the remnants of feudal responsibility. However much is due to the disparities in wealth in a young country. They have long taken take pride in family prosperity, regional success and the formation of a successful nation. This drives a need for effective leadership both inside and outside the business.
Finally The India Way explains that corporate governance in India tends to be based around values which reflect the culture driven approach to business in India. This is contrast to the American rules and compliance based approach to governance. As Indian corporation become global and leave the emerging market of India they need to converge on to a more western approach. Indeed as many major Indian business have chosen to list on the US stock markets they have had to adopt US corporate governance and accounting practice. Others have done so voluntarily recognising that it gives customers comfort and puts them ahead of the game as governance practices converge.
Although the writing in The India Way may be a little dry for some readers it is important reading as India companies become major global players and change the rules for everyone. Whether it will revolutionise the way western businesses work or whether Indian business adopt western practice is unimportant at this stage but managers need to be aware and able to understand what is happening. Probably most likely, judging by the governance changes that are taking place, will be some form of convergence. Whatever the result The India Way will have a profound effect on western management in their home markets as well as for their drive into India, and other emerging markets.
The India Way, How India’s Top Business Leaders are Revolutionizing Management (2010, ISBN: 978-1-4221-47597) by Peter Cappelli, Harbir Singh, Jitendra Singh and Michael Useem is published in hardback by Harvard Business Press at $29.95