|
|
    
|
TRIMILLENNIUM MANAGEMENT:
STRATEGIES In the 2000s, all strategies will be grey ! By Ajay Piramal
However, with the integration of the Indian industry with the global economy, and the lowering of tariffs, Indian customers have become more demanding and sophisticated. A greater awareness to global news, views, and brands has created a situation where local manufacturers are no longer preferred. Thus, companies need to build their strategies around the creation of intellectual assets. There are several reasons for this. Given the high cost of capital, and the high cost of inputs like steel and energy in India, organisations will find it difficult to compete globally in several industries. The logistics infrastructure in India is so poor that organisations face the continuous threat of not delivering products or services on time, or increasing freight-costs in trying to deliver the product or service to the customer on schedule. Therefore, it may not be realistically possible for India to become a global manufacturing force in this millennium. but, with communication costs dropping rapidly, India has a chance to dominate-and has already started doing so-knowledge slivers of conventional value chains, such as transaction, information, claims, or account-processing. India has tremendous potential in this context. By 2005, two-thirds of the country's 1.10 billion people will be literate. And close to 50 per cent will be under 20 years of age. Television networks will cover all of urban India, and 60 per cent of rural India. The number of households earning more than $10,000 a year on a purchasing-power-parity basis will double from 16 to 31 million. The first few years of this millennium will also bring about social and economic shifts, which will change the manner in which consumers behave. Increased knowledge, information, and buying-power will influence people to aspire for better lifestyles. These factors imply a completely new paradigm for Indian business. Human capital will become an essential component of the corporate toolkit and the strategy process. As the Industrial Age makes way for the Information Age, companies will start valuing individual skills. Inertial business models and strategies that are based on, and built around, physical assets will give way to the short half-life, flexible models, and strategies that are based on intellectual capital. The developmental path of most nations sees them graduating from agricultural wealth-creation to industrial wealth-creation. And, over time, industrial wealth gives way to intellectual wealth. India's performance was mediocre in both agriculture and industry. While food-security isn't really an issue-the food output of the country can meet the needs of an ever-growing population-India's agricultural productivity lags well behind those of several first world countries. However, assets and strategies based on intellectual advantages can catapult the country into a future of great prosperity, and wipe out all memories of an inefficient past. In this millennium, India Inc. will witness 2 significant manifestations of intellectual capital: its vibrant infotech industry, and its unique R&D capabilities. Even by the beginning of this millennium, several infotech companies have managed to create an enormous amount of wealth and stretch their reach into other markets. And this millennium is certain to see several dramatic developments in drug discovery across Indian pharmaceutical laboratories. The 21st Century will be one of opportunities and challenges for the enterprising. It will not be a time of long product or technology life-cycles. It will be an age of discontinuities and seismic shifts in consumer loyalties, tastes, and expectations. Communications, entertainment, and computing technologies will, eventually, converge. And the boundaries between businesses will blur. The resulting scenario will be one that is uncertain and filled with risks. Yet, it will also present an opportunity to the brave. Soon, convergence will reach a critical mass, and technologies, whether in the fields of information, bio-science, communications, or material, will coalesce with intense energy to uncover a completely new landscape. Organisations that have built competitive positions and strategies around the junctions of these technologies-or the prescient knowledge to invest in ventures that seek to explore these intersections-will emerge as the wealth-creators in the New Millennium. For instance, the convergence of biotechnology and computing technology is uncovering new techniques for pharmaceutical research. Automation technology, specialised chip design, miniaturisation technology, and other computing-intensive technologies have already merged to create several forms of laboratory techniques such as gene-sequencing machines, robotic-chemistry devices, high-throughput screening, combinatorial chemistry, and proteonics. These will reduce the cost of several explorations: from mapping genes to building and testing new drug components. Even in agriculture, the benefits of biotechnology seem to be immense. Sophisticated genetic engineering, such as microscopic gene-painted pellets that are shot into a plant's DNA, will help companies create wheat that is resistant to pests, or corn that is more productive. Only those companies that build their strategies around the many impossibilities that technology-or the convergence of technologies-makes possible will succeed in this New Millennium. In conclusion, I see 6 elements in the ideal millennial strategy:
These are the 6 variables that the millennial strategies of organisations should address if they wish to benefit from the economies of the Knowledge Era. Ajay Piramal is the CEO of Piramal Enterprises
|
|
Issue Contents Write to us Subscriptions Syndication INDIA TODAY | INDIA TODAY PLUS | COMPUTERS TODAY © Living Media India Ltd |
 |
 |
For years, Indian industry relied on entry-barriers to protect itself
from competition. In an era when the success of corporations depended more on political
patronage than meritorious operational performance, licences held the key to growth. High
tariffs ensured a high level of artificial loyalty from customers who had little choice.