This is one of the most challenging pieces that I have ever written for this magazine. In Business & Economy, I generally limit myself mainly to writing the back of the book column. However, this time, when my editorial team requested me to write for the cover story as well, since the cover topic was on responsible leadership – one of my key areas of passion – I got excited immediately and gave my consent. Then came the bombshell. India’s pride, the Dean of Harvard Business School, Dr. Nitin Nohria was also writing for the same cover story! As if that were not enough, they also told me that the two people I personally admire the most, J. J. Irani and Kris Gopalakrishnan were also contributing! I was left stumped and excited at the prospect of writing for a cover story which was to have such luminaries contributing! And that’s why it was a great challenge to decide what to write on. After putting considerable time to it, I thought that it was pertinent to write about a personal favourite theory of mine that I wrote about in my book The Great Indian Dream; and the theory is the Survival of the Weakest! Although it was intended to be more of an economic theory, I think that it is perhaps the most important aspect of responsible leadership that our country’s leaders – political as well as corporate – need to follow.
I have always believed that driving an organisation by looking only into profits is like driving a car by looking only into the rearview mirror: it tells you about the road you have been through but not about the road ahead. Today’s entrepreneurs, leaders and businessmen carry the responsibility to take India into the new world order. This requires leaders with a vision who understand the seriousness of the responsibilities they carry. But for this, they first need to understand their country well.
India is ranked 119th out of 169 countries in the world in the Human Development Index for 2010. Today, around 37% of the Indian population is living below the poverty line as per the Tendulkar committee report in 2010. As recently as in 2004-05, the government estimated that 25.7% of the population (and not 37%) was living below the poverty line! The Director of the UN Research Institute for Social Development, Thandika Mkandawire, has commented that the Indian data (with respect to poverty estimates) is “always controversial”. As is known, the poverty line in India was recently defined at Rs.32 per person per day for urban areas and Rs.26 per person per day for rural areas. Only Indian politicians and economists with all their insincerity have the ability of calling this a poverty line. This should be called the destitution line. As per the government, earning Rs.960 per head per month is enough to be above the poverty line in urban India! No wonder that in the red light district of Bombay, Kamathipura, women are bonded into prostitution today because years ago their grandparents took loans ranging from Rs.12 to Rs.50! Today, we contribute 1.32% to the world’s total exports (WTO figures for 2009). Compare it with China, which contributes 9.6%. Their percentage might still seem lower because of their phenomenally competitive prices.
But to realise the Chinese impact, one has to just visit the shops of Europe and USA and pick up any product – from the cheapest of utility items to the costliest of designer goods – to discover that they are all ‘Made in China’. India alone accounts for around 35.5% of the total adult illiterate population of the world (283.1 million illiterate adults in 2010); yet, we are excited about being the country with the most qualified & educated human resource. In India, we have 1 Indian doctor per 2,400 Indians but we have 1 Indian doctor serving every 1,325 Americans in the US!
Today, 40% of Bombay is a slum and 35% of Delhi defecates in the open. Only 232 towns in India have a working sewer system and that too partially including Delhi. Around five lakh people still carry human excreta on their heads everyday. India ranks 67 on the Hunger Index for 2010 taken out by the International Food Policy Research Institute (IFPRI) and is home to 42% of the world’s underweight children under the age of five (Nepal, Pakistan, Sri Lanka are better, and so are Sudan, Lesotho, Uzbekistan and Rwanda). We created such a lot of noise when just about 50 people died of plague because the richer segments of our economy were also under danger. But when around 370,000 people die every year of T.B. and nearly half a million people suffer from diarrhoea everyday, no one raises a whisper. China has around 60% of arable land compared to India. Their annual food production at the same time is 550 million tonnes (2011 projections) as against the 241.56 million tonnes that we produce (RBI, FY 2010-11).
We still see leaders in India who just talk or play the unending blame game, a corporate world which still cannot go beyond seeking concessions from the government, an NGO sector which has become an industry in itself and also the rest of us, who have little choice but to watch helplessly, waiting for crusaders like Anna Hazare to come along. With a crippling lack of leadership at the government level in the country and oceans of sufferings around us, one often wonders if India truly is a democracy, when people don’t have basic rights to food, drinking water, health, sanitation – in short, the right to a life of dignity, or in most cases, the right to life itself. Contrast this with neighbouring China, where things happen through massive top down planning from the government at the centre. Growth in China has also succeeded in rapidly lifting people out of poverty. UNDP data states that incidence of rural poverty went down in China from 30.7% in 1978 to just 1.6% in 2007. Clearly, this makes it not only a country which has taken far better care of the poorest of poor, but even a far more strong market for business as compared to India.
What has worked, to the extent it has, in India is the private sector post the liberalisation era. We would realise that entrepreneurs and leaders of the India of today have this tremendous responsibility of taking this country of poor, uneducated, unemployed and ill-fed ahead towards a new beginning. Looking at the central leadership issues, India has to necessarily be a bottom-up growth story led by private enterprise. For this, the private enterprises need to realise the importance of utilising the various lobbies that they control like CII, FICCI et al to pressurise the government to come out with pro-people and anti-poverty policies to help this country grow. Private players need to come out of their petty and short sighted vision and focus upon the larger interests of the country.
They need to realise that in the country’s interest lies their interest. No amount of management and marketing techniques can enable corporations to have a more than 10 to 15% growth in their market – but the market can be expanded by more than 1000% by increasing the purchasing power of the people. Then, instead of the middle class being an approximate 100 million, it would become more than 500 million. This common sense economics should be clear to everybody. Otherwise, we will keep standing and watching most FDI flow into China with its much larger market base. If the purchasing power levels in India increase, these very entrepreneurs who command no respect in the global arena today will walk with their heads held high tomorrow. This is exactly where survival of the weakest comes in.
I have always believed that driving an organisation by looking only into profits is like driving a car by looking only into the rearview mirror: it tells you about the road you have been through but not about the road ahead. Today’s entrepreneurs, leaders and businessmen carry the responsibility to take India into the new world order. This requires leaders with a vision who understand the seriousness of the responsibilities they carry. But for this, they first need to understand their country well.
India is ranked 119th out of 169 countries in the world in the Human Development Index for 2010. Today, around 37% of the Indian population is living below the poverty line as per the Tendulkar committee report in 2010. As recently as in 2004-05, the government estimated that 25.7% of the population (and not 37%) was living below the poverty line! The Director of the UN Research Institute for Social Development, Thandika Mkandawire, has commented that the Indian data (with respect to poverty estimates) is “always controversial”. As is known, the poverty line in India was recently defined at Rs.32 per person per day for urban areas and Rs.26 per person per day for rural areas. Only Indian politicians and economists with all their insincerity have the ability of calling this a poverty line. This should be called the destitution line. As per the government, earning Rs.960 per head per month is enough to be above the poverty line in urban India! No wonder that in the red light district of Bombay, Kamathipura, women are bonded into prostitution today because years ago their grandparents took loans ranging from Rs.12 to Rs.50! Today, we contribute 1.32% to the world’s total exports (WTO figures for 2009). Compare it with China, which contributes 9.6%. Their percentage might still seem lower because of their phenomenally competitive prices.
But to realise the Chinese impact, one has to just visit the shops of Europe and USA and pick up any product – from the cheapest of utility items to the costliest of designer goods – to discover that they are all ‘Made in China’. India alone accounts for around 35.5% of the total adult illiterate population of the world (283.1 million illiterate adults in 2010); yet, we are excited about being the country with the most qualified & educated human resource. In India, we have 1 Indian doctor per 2,400 Indians but we have 1 Indian doctor serving every 1,325 Americans in the US!
Today, 40% of Bombay is a slum and 35% of Delhi defecates in the open. Only 232 towns in India have a working sewer system and that too partially including Delhi. Around five lakh people still carry human excreta on their heads everyday. India ranks 67 on the Hunger Index for 2010 taken out by the International Food Policy Research Institute (IFPRI) and is home to 42% of the world’s underweight children under the age of five (Nepal, Pakistan, Sri Lanka are better, and so are Sudan, Lesotho, Uzbekistan and Rwanda). We created such a lot of noise when just about 50 people died of plague because the richer segments of our economy were also under danger. But when around 370,000 people die every year of T.B. and nearly half a million people suffer from diarrhoea everyday, no one raises a whisper. China has around 60% of arable land compared to India. Their annual food production at the same time is 550 million tonnes (2011 projections) as against the 241.56 million tonnes that we produce (RBI, FY 2010-11).
We still see leaders in India who just talk or play the unending blame game, a corporate world which still cannot go beyond seeking concessions from the government, an NGO sector which has become an industry in itself and also the rest of us, who have little choice but to watch helplessly, waiting for crusaders like Anna Hazare to come along. With a crippling lack of leadership at the government level in the country and oceans of sufferings around us, one often wonders if India truly is a democracy, when people don’t have basic rights to food, drinking water, health, sanitation – in short, the right to a life of dignity, or in most cases, the right to life itself. Contrast this with neighbouring China, where things happen through massive top down planning from the government at the centre. Growth in China has also succeeded in rapidly lifting people out of poverty. UNDP data states that incidence of rural poverty went down in China from 30.7% in 1978 to just 1.6% in 2007. Clearly, this makes it not only a country which has taken far better care of the poorest of poor, but even a far more strong market for business as compared to India.
What has worked, to the extent it has, in India is the private sector post the liberalisation era. We would realise that entrepreneurs and leaders of the India of today have this tremendous responsibility of taking this country of poor, uneducated, unemployed and ill-fed ahead towards a new beginning. Looking at the central leadership issues, India has to necessarily be a bottom-up growth story led by private enterprise. For this, the private enterprises need to realise the importance of utilising the various lobbies that they control like CII, FICCI et al to pressurise the government to come out with pro-people and anti-poverty policies to help this country grow. Private players need to come out of their petty and short sighted vision and focus upon the larger interests of the country.
They need to realise that in the country’s interest lies their interest. No amount of management and marketing techniques can enable corporations to have a more than 10 to 15% growth in their market – but the market can be expanded by more than 1000% by increasing the purchasing power of the people. Then, instead of the middle class being an approximate 100 million, it would become more than 500 million. This common sense economics should be clear to everybody. Otherwise, we will keep standing and watching most FDI flow into China with its much larger market base. If the purchasing power levels in India increase, these very entrepreneurs who command no respect in the global arena today will walk with their heads held high tomorrow. This is exactly where survival of the weakest comes in.
Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
For More IIPM Info, Visit below mentioned IIPM articles.
IIPM Best B School India
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM's Management Consulting Arm-Planman Consulting
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
For More IIPM Info, Visit below mentioned IIPM articles.
IIPM Best B School India
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM's Management Consulting Arm-Planman Consulting
