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What European businesses need to know to do business effectively in India

According to a recent PricewaterhouseCoopers report, India will be the third largest economy by 2050*, underlining the rate at which it is emerging as a global economic powerhouse. As such, the opportunities for European businesses to trade and develop a foothold in the region are opening up, in what is now one of the largest and fastest growing markets. So what do European organisations need to know to maximise their opportunities of forging a path in India?

Cultural Values

To work well with Indian companies it’s important to understand the country, its people and its business culture. One of the biggest factors fuelling the way that business is done is the fast growth economy, which affects that way that people think and act. In Europe we have probably forgotten what that feels like; the assumption that next year and the year after and for as far as you can see your business has the potential to grow. This brings a confidence that European firms can tap into to sell their products and services. It also gives these firms the opportunity to challenge their India suppliers to invest in solutions on their behalf; when things are going well Indian firms are willing to take bets on the future that many European firms would not.

One route to boosting business opportunities is through one of the many large conglomerates, a kind of company structure that went out of fashion a long time ago here, as companies followed the mantra of focusing on core competencies. However these kind of conglomerates can give European firms rapid access to a wide range of different businesses through a single set of relationships.

As a case in point, one of our customers, a UK publishing company has been able to tap into our Indian web of contacts to establish their operations strategy for the sub continent in a fast and effective manner. In another example, a UK utility company we worked with wanted to understand the Indian market and to learn more about potentially setting up, or providing consultancy, in the country. As we had a water utility within our group, we could broker a deal between the two companies and another part of the group could provide IT support.

This approach can also help to overcome the challenges presented by such as large geography; many organisations may focus on two or three key Indian cities, but there can be significant differences in the way that business is done even across these cities. Working with a conglomerate can help organisations to steer a path through these nuances.

Problem Solving

As with anywhere in the world relationships are important, but in India ties of friendship and family are far stronger , longer lasting and have a real impact on the way business is done. Moreover, the history and culture impact the way a business opportunity or problem is approached. I have seen numerous examples of ingenuity and making the most of what is available to solve problems that in Europe would normally be resolved from starting afresh.

Recently one of our large manufacturing customers was on the verge of scrapping an application that was used to convert orders into a factory schedule for materials and production planning. Due to increased volumes it was struggling to meet demand. Order throughput was 12 orders per minute, well below requirement. The Indian team pleaded for chance to look at the innards of the application to see what could be fixed and a detailed analysis and development project allowed the old application to be tuned allowing an order throughput of 68 orders per minute and that 18 hour batch job was reduced to just 20 minutes, all at less than 10% of the cost of a new application. This mindset and approach to problems is indicative of the ingenuity of Indian problem solving; nothing gets thrown away without a very good reason.

India is a rising economic power and now is the time to make the most of the opportunities on offer before they are missed. There is no substitute for spending time there to really understand the culture and experience all that it has to offer for European businesses first hand. Seeing really is believing.

*World In 2050: The BRICs and beyond: prospects, challenges and opportunities - PriceWaterhouseCoopers

This was posted in Bdaily's Members' News section by Roger Newman .