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India's Global Powerhouses: How They Are Taking on the World Hardcover – March 3, 2009
The Amazon Book Review
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From Publishers Weekly
Starred Review. Marketing professor Kumar (of the London Business School) asserts that India, along with other economic hotspots like China and Dubai, "will be unrecognizable in a decade," having "helped remake the global and political economic landscape." With coauthors Mohapatra (a player in India's private sector) and Chandrasekhar (of D.C. think-tank Strategic Insights), he assembles in-depth case studies of India's multinational operators, covering the country's pre- and post-independence history, and how an overwhelming government bureaucracy became a business-friendly regime. A look at India's Tata Group, founded 1868, reveals its extraordinary evolution into a powerful modern business through select acquisitions in hotels, steel, tea and automobiles (like its 2008 acquisition of Jaguar and Land Rover). Another captivating account tracks Essel Propack's small laminated tube company, which found global success as a supplier for Proctor & Gamble (illustrating the Hindu proverb, "Help thy brother's boat across and, Lo! Thine own has reached the shore"). Challenges for Indian multinationals like Infosys and turbine manufacturer Suzlon include skyrocketing executive compensation and rental costs, a lack of globally-minded managers and a cultural difficulty with teamwork. As Kumar and company demonstrate, the future of business in India is worth understanding, and their detailed volume makes an excellent primer.
In this invaluable contribution to the study of India's rising economic might, Professor Kumar brings us up close to the people, organizations, and ideas reshaping global commerce. India's Global Powerhouses is an essential read for all leaders in business, public policy, and education. --Muhtar Kent, President and CEO, The Coca-Cola Company<br /><br />Kumar has comprehensively captured the ascendance of global Indian corporations. Each case study highlights the unique vision and approach of one company on its path to the level of global competition. As a whole, this book is a must-read for all global managers who seek to understand and make the most of the emerging international powerhouse of India. --Nandan Nilekani, Cochairman, Infosys Technologies Limited<br /><br />Nirmalya Kumar has captured the energy and the ambition driving those Indian companies that have become global powerhouses. When India opened to the world in 1991, few imagined that her companies would go global. This book documents their remarkable success. --P. Chidambaram, Minister for Home Affairs, India
As Kumar and company demonstrate, the future of business in India is worth understanding, and their detailed volume makes an excellent primer. --Publisher's Weekly
"But the significance of the coffee-house conversation, and many like it, is better understood after reading Nirmalya Kumar s more slender volume, India s Global Powerhouses"
"A particular value of the book lies in its concise case studies..."
"...highly readable book..." --Financial Times
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There are no insights as to how Indian companies are buying global firms. The author starts with providing the typical cliches about how India is growing. Well we all know that!! Followed by list of acquisitions by Indian companies. I already know Tata bought Tetley and Jaguar.
I was hoping to read insights about how and why Tata made this acquisition. What are the benefits of it. How steps should Indian companies take in their path towards becoming global players. Sadly such insights are totally lacking in the book.
The case studies about the companies are interesting but again miss the insights and just provide data. The author goes into the history of each company.
If Amazon permits downloading Kindle samples outside the US, I could have avoided buying this book.
About 60% of India's 200 largest firms have global aspirations. In 2006 Indian outward investment outstripped foreign investment into India. Major players include Moser Baer (world's second-largest producer of DVDs), Tata Steel (world's fifth largest steel producer), Hindalco (world's largest aluminum rolling company), Mahindra & Mahindra (one of the world's top three tractor manufacturers), Reliance Industries Limited (world's largest producer of polyester fiber and yarn), Tata Tea (owns brands like Tetley), Tata Motors (Jaguar and Land Rover), Oberoi Group (four of the world's ten highest rated hotels, per Conde Nast readers), Vedanta (world's lowest-cost zinc producer). Others include Larsen & Toubro (building ten coal gasification plants in China), and Bharti Airtel (among world top ten wireless companies, averages 50% margins - despite average revenues/enrollee only one-fifth that in Europe).
Infosys, Tata Consultancy Services, and Wipro Technologies collect annual revenues around $12 billion, with average operating margins of 20% - twice that at IBM. (IBM's operating margins are higher than the average for the six largest U.S. technology firms, including EDS and Accenture. Meanwhile, Accenture India has 50,000 employees - more than Accenture U.S., and IBM has 50,000 Indian employees as well. HCL Technologies, an Indian R&D outsourcing company, designed two critical systems for Boeing's 787 Dreamliner - one to land in zero visibility, the other to avoid airborne collisions. Nicholas Piramal India Limited conducts clinical trials globally for Eli Lilly. Google chose Bangalore as the site of its first R&D center outside the U.S. G.E., H-P, Sun Microsystems, Texas Instruments are others. Intel's R&D center in Bengaluru is its largest unit outside the U.S., and recently delivered the world's first tera-scale experimental chip capable of 1 trillion operations/second. There are now more than 600 captive R&D centers in India.
A Bangalore-based company called 24/7 Customer started out as a call center, and has innovated so that it can determine from both what you called about and your tone of voice who would be best qualified to take your call.
China now has a far superior infrastructure, more developed manufacturing capabilities (13% of global manufacturing output, vs. 2% in India), but India's advantages include greater English capabilities, a younger population (per China's 'one-child policy'), and the opportunity for global firms to diversify part of their supply chain outside China. India's disadvantages include limited education opportunities, weaker intellectual property protection, less early-stage venture capital funding, and a stultifying bureaucracy - it takes 159 - 522 days to get a business license, and an average 225 days to get a building permit. (A new Four Seasons Hotel required 165 government permits.) Both China and India reap advantages from their status as major markets for Western products.
On the 'bad side,' India has yet to create a single, internal market - each state imposes its own inspection requirements, duties, and regulations on shipments crossing its borders, even those simply going to another state in India. The average time to clear exports through Indian customs is nearly 16 days, vs. 6 in China or the OECD. Unreliable power is estimated to cost Indian businesses 6X that of their counterparts in China. It takes an average of four years to enforce a contract in India, vs. 9+ months in China - thus, the headquarters of some of India's major firms have moved to European sites.
Professor/author Kumar interviewed 35 leading CEOs in researching this book. It's bottom line could perhaps be summarized as Horace Greeley's advice today probably would be 'Go East, young man - the developed world is facing a long decline in its standard of living.' The bulk of the book consists of mini case-studies of successful global Indian firms.
Most Americans equate Indian firms, the same as Chinese companies. Yet they are quite different. Most Indians speak English, while Chinese don't. Indian firms are already on the global stage, while few Chinese firms made it.
The problems such as Satyam, government red tapes, corruption, were not mentioned in this book. Overall, it is a worthwhile reading.
The book starts with a chapter of statistics that, honestly, is a bit overwhelming. The data points are impressive and the reader is left with a clear recognition that the Indian economic miracle is much more than off-shore call centers. As the authors point out repeatedly, India benefits from many inherent advantages:
The concentration and somewhat incestuous integration between companies.
The importance of powerful families with controlling interest in major firms.
The low cost of production.
The fact that Indians are fluent in English.
That India is now viewed as a producer of quality products and not a threat as many might view China.
All of these key points are expounded upon as the book progresses.
The only disappointment is that there wasn't more discussion about the effects - both positive and negative regarding the major recession that the world is currently undergoing and its effect on Indian entrepreneur's ability to continue to expand internationally. In all fairness, the book was likely in its final stages of editing and publication as the full magnitude of the crisis hit in 2008, so it is more an unfortunate set of timing rather than the author's omission.
The meat of the book is centered on in-depth case studies, examining nine international Indian firms whose presence spans a cross section of industry sectors. Rather strict guidelines were followed when determining the top companies that are featured in the book and that criterion appears well reasoned. The result of these case studies is a common thread - Indian entrepreneurs are certain that this is their time and the world is their stage. They are convinced that they have advantageous that others are missing and in this historical setting they are quite ready and anxious to take their place as world economic powers.
The book concludes with hurdles that must be overcome as Indian companies increasing emerge on the world stage. These companies will naturally lose some of their inherent advantageous as they mature such as low cost production so there are natural progressions they must make to become and remain dominant players internationally. This not uncommon though. The Japanese and Koreans also made this transformation in the recent past. With 13 of today's largest 500 global companies Indian owned, a transformation has already began to take place. The authors argue that it is only beginning. After reading India's Global Powerhouses, I cannot help but agree!
L.A. Little, Reviewer for bookpleasures and TA Today