Clash of the corporates

Experts at the IIMA HR Conclave for Sharing Perspectives on Learning and Development, held in Mumbai recently, believe that the Indian economy is not safe from being affected by the global economic slowdown – but is a rather highly-exposed economy whose 60 per cent Gross Domestic Product (GDP) is strained – and where all Indian managers necessarily have to become global managers. 

The Conclave was designed for Human Resource (HR) heads and leaders of learning and development in the corporate and government sectors, startups and other organisations with focus on identifying needs, approaches and challenges in learning and development across various sectors.

“The government policy is not conducive to operating in India. Where have the corporates gone? When the home economy does not permit it, that’s when they go. So the challenges are quite significant for India,” Professor Sebastian Morris, Chairperson, EX. Ed, IIMA, said. 

“To meet these needs, we at the Indian Institute of Management (IIM), Ahmedabad, are offering various programmes for professionals including distance learning and blended learning opportunities,” he added while noting that the institute had successfully conducted suitable programmes for SAARC, Africa and Middle-East nations, besides Indian companies and NGOs.

 “Today’s HR industry needs to be aware of the new challenges and trends that the companies are facing along with the need to be keeping up with the modern times, where expectations are different and includes cutting-edge neuroscience which we are sharing with the conclave participants, who have come from all around the country” professor Ashish Nanda, Director, IIMA, said.

 “India is a structured economy and has a great deal of potential. Look at the vitality of our economy. We have to be globally-minded to be successful and leverage all our assets in this regard,” he added while pointing out that even a Middle Eastern group had come for training at the institute. 

“Our learning tools are crossing geographical boundaries, even as countries are facing a slowdown globally and becoming more inward-looking to solve their problems,” he further added.While any organisation’s leadership is responsible for its future prosperity and success to become part of an elite list today, hardly any top company makes it on top of such a list.

 The main reason not only being the vanishing streak of these companies but entry of new businesses which were nowhere to be seen years ago. This is due to fast rate of change in external and technological environments and technological advancements which are challenging small and big established businesses like never before. 

“Keeping up with growth and sustainability and tracking such environmental changes needs resources, time and access to privileged knowledge, where top executives are exposed to the latest trends and skills through world-class education programmes including managerial tools like business-intelligence techniques, data analysis, modeling and best practices in general management and SHRM,” Nanda added.  

E-tailing will drive 25 per cent of the total organised retail sales in India by 2020 at $60 billion and a total number of online shoppers reaching 175 million by 2020, according to a recent Google/ A.T. Kearney Report. Lifestyle will take over consumer electronics as the largest E-tail category by 2020 and one third of the customers will drive two thirds of the total online shopping expenditure. 

The report, Digital Retail 2020, comprises of online buyers and non-buyers, sellers and non-Internet users across 20 cities in India including metro cities. It highlighted evolving industry dynamics and key consumer insights that will drive the next phase of E-commerce, while projecting that E-tailing will become a substantial channel for the organised retail sector, contributing as much as 25 per cent of the total organised retail sales in by 2020 and reaching $60 billion in gross merchandising value.

The report predicts that the total number of online shoppers will grow to 175 million by 2020. Value-added service would be a key differentiator and over 90 per cent of the online buyers will be willing to pay for premium value-added services. Over 46 per cent of online buyers said that they will be willing to pay extra charges for faster delivery. Thirty seven per cent for hassle-free return and 35 per cent were willing to pay more for extended warranty.

Rajan Anandan, VP and Managing Director, Google SEA and India, said that the E-tailing industry in India is at an inflection point and will touch 175 million online buyers by 2020, while the next three to four years will be critical for the industry to get on the path of sustained profitability.

 “Some areas that will accelerate and support profitability include following a focused approach to drive deeper engagement with 60 million high-value customers and two thirds of the total spends on E-tailing. Innovative delivery models and creating omni-channel presence will help bring on board new online shoppers and grow overall share of E-tailing in India’s organised retail industry”, he added. 

Ajay Gupta, partner with A.T. Kearney, noted, “As the Internet continues to grow, digital presence is paramount for brands and organised retail as it will influence 50 per cent of all purchase decisions, be it in discovery or comparison. Our data reveals that majority of buyers will continue to purchase online, even if there are no discounts. With the right game plan and focused efforts, the E-tailing industry will grow at a healthy CAGR of 40 per cent.”

The report indicated a five-time growth in number of women shoppers by 2020, and also women currently shopping online doubling their share of online spending with more focus on lifestyle categories – namely apparel and accessories – in looking for latest trends and brands online, flexible delivery time, and more pick-up locations.

Lifestyle category is expected to overtake consumer electronics as largest online category at 35 per cent of the total online spends, while consumer electronics will be 20 per cent by 2020. Omni-channel presence will become very important in categories such as – home and furnishings, lifestyle and consumer electronics to serve the need gaps of non-buyers. 

In home and furnishing, over 60 per cent buyers wanted physical stores to see and test the product before buying. In lifestyle, 40 per cent respondents said that having offline stories will help in alterations of clothes and for consumer durables, 60 per cent buyers wanted salesman guidance for installing and using the product.

By 2020, 55 per cent of online volumes will be driven by cashless transactions (as opposed to 40 per cent today) and mobile wallet share will double by 2020 to reach 15 per cent from current eight per cent. The base of online sellers will need to grow upto five times in order to cater to the increase in demand from users across geographies and improve delivery capabilities. 

Meanwhile, the country’s electricity sector is continuing to stimulate financial growth as India’s power companies move into a power growth mode. NHPC Hydropower Company reported a 15 per cent growth in standalone net profit at Rs 2440 crore in FY 2015-2016, as against Rs 2124 crore in same period last year, besides the highest-ever total cumulative power generation of its 20 power stations with 23,683 MU in FY 2015-2016 against targeted 22,000 MU last year. 

K M Singh, CMD, said that besides a total of five projects presently under its belt including four hydropower projects having a total installed capacity of 3290 MW, the company’s successes included – the first PPA signed (in regard to Tawang HE Project Stage I and II, Arunachal Pradesh) between NHPC and Nagaland government – and NHPC being the only hydropower utility in India to have a real time data centre. MOU’s with West Bengal’s State Electricity Distribution Company Limited for developing four hydro-projects (three on Teesta Dam and one on Rammam State-I)with a total of 293 MW capacity; besides the 2880 MW Dibang Multipurpose Project. Arunachal Pradesh being accorded forest and environmental clearances in April 2015; MOU with Solar Energy Corporation of India for development of 250 MW Grid-Connected Solar Power Projects and a wind project (50 MW) in Jaisalmer, is nearing completion.

Start-ups and scale-ups are being given a boost in the human transportation world. Ola introduced a new mobile app Ola Operator for entrepreneurs (who have grown from one car to many on the Ola platform over time) and operators owning cars but employing drivers, while seeking to add tens of thousands of new operators on its platform including driver-partners turned entrepreneurs, operators in transportation business and aspiring first-time entrepreneurs wanting to be part of the mobility ecosystem.

“This platform aims to foster the growing entrepreneurial mindset of young India,” Sumit Tuteja, Senior Director, Product Ola, said, adding that entrepreneurs remain the key to our mission of building mobility for a billion Indians, and technology needs for entrepreneurs to succeed at scale are different that what helped them to grow as driver-partners. This new app, Ola Operator, will enable operators to conveniently track location of their registered vehicles in real-time and receive live alerts on their running status, besides also remaining as a repository for requisite documents like vehicle registration, insurance and licence of appointed drivers etc.”

“I am confident that this technology will help me scale up from a few cars to a larger fleet in no time,” said Anil Shinde, Entrepreneur and Operator on the Ola App in Mumbai, who joined Ola as an Operator and currently has 5 cars on the platform. “This easy-to-use technology has been created keeping in mind small to large operator like me on the Ola platform, and I was one of the privileged few to test the beta version of this App for a week where I could monitor driver/car status, payment details and fleet performance at any point of time,” he said.

Meanwhile, even as the furore over use of diesel continues, Japan’s Toyota recently launched its 2nd generation car in its latest avatar – ‘Innova Crysta’ – with an all-new 2.8 litre diesel engine in Mumbai recently at prices of Rs 20,77,930 and Rs 13,83,677 with automatic/manual transmission and waiting period extending to two to four months across India.

 Shekar Vishwanathan, vice chairman and whole-time director, Toyota Kirloskar Motor, said the Innova continued to maintain its No. 1 positioning in its segment synonymous with MPVs in India and as an iconic brand highlighting a benchmark in luxury, comfort and toughness, besides commanding a resale price and the old Innova getting phased out. 

 “Our intention was to design a minivan with comfort and this one was built on a new frame. We added seven airbags for safety and the front ‘crumple’ zone ensures less fatality in accidents. There is demand for automatic transmission vehicles and will manifest itself in greater volumes,” he said while adding – to a question – “The Supreme Court has acknowledged that every fuel has its own set of pollutants. We believe that the ban will be lifted and we can address the needs of Delhi and other States.”