Still to go global...

The Fast

Track Leadership survey and Infosys' quarterly results announcement. Two very

different events, but with a common thread.

Let me take each

separately. According to the Fast Track Leadership survey conducted in November

2005 by Fast Company magazine, IMD (Switzerland-based international business

school), and placement and consulting firm, Egon Zehnder International, which

included responses from over 847 business professionals, less than 50% believe

that their companies are well equipped to handle competition from countries such

as China (46.8%), India (49.1%), and South Korea (49.5%). Another question:

“In the next five years your company will face strong competition from

businesses based in” also showed similar results. Another piece of data. Three

Indian companies, Tata, Infosys, and Wipro were among the top ten when

respondents were posed this question: “Name a company with its headquarters in

an emerging market that you admire”. It is good to see Indian companies

causing a ruffle among global business execs and it is not a coincidence that

the three companies mentioned, are leading IT companies.

The poll is also

validated by the global stock market. Look at the market cap of top IT services

companies during the previous year. While IBM is still the 'Badshaw' with a

market cap of $129 bn, as of December 2005, the Indian trio is in the top five

slots. Another interesting facet of this data is that the Indian trio has shown

a double-digit growth rate in the market cap for the whole year. While IBM and

EDS saw a decline in their market cap by about 20% and 3% respectively, other

giants such as Accenture and CSC posted marginal gains of 2% each. It has to be

mentioned that the revenues of Indian companies are below $2.5 bn, while those

of the global companies are in excess of $14 bn.

Now what has this data

got to do with Infosys' results? It is not about Infosys coming out with

another sterling performance of a 31% jump in third quarter profits or that it

expects a similar growth rate in the coming quarter. No, this is about Bangalore.

During the press conference, Nandan Nilekani, CEO and MD of Infosys mentioned

that they have no room to expand in Bangalore and future expansion may not

happen in the silicon valley of India. This comes a few days after the Infosys'

chief mentor NR Narayana Murthy remarked that Indian companies can look at

moving out of India. He mentioned that despite growing rapidly and creating huge

employment opportunities, India continues to lag behind in the world network

readiness index. At 39th  rank,

India needs to take urgent steps to upgrade power supply and airports, or

else... Given the global branding that Indian IT companies have achieved,

countries across the globe including South Korea, China, and in Europe are keen

to invite Indian IT companies to set shop.

What I find interesting

is that the Indian IT companies have got global recognition despite

infrastructure limitations. I wonder what would have happened if we had the

infrastructure in place. Global execs will start looking at various segments

such as auto ancillary, textiles, et al which will pose serious threat to their

businesses.  

The irony is that all

are aware of the grim situation, including the decision makers, yet things are

not moving or at best chugging at snail's pace. Take the Bangalore Airport

logjam. Five long years wasted and even basic work has not started. And such

examples are strewn across the country and across various projects.

I want to hope, against

futile hope, that in the many more such surveys like the Fast Track Leadership

survey, I see the number of admired Indian companies on the rise and companies

in India emerging as global corporations, but...

Yograj Varma, associate editor, Dataquest  



yograjv@cybermedia.co.in