Recently there was a public spat between the two big cab aggregators in the country with the desi version accusing the videshi competitor of the advantages they enjoy here because of their American pedigree. This was ironical on two fronts:
All the operating elements of both businesses are essentially and comprehensively Indian starting with the local business heads. But the really funny part is that the Indian business is primarily capitalised by videshi PE funds. So much for the grand standing!
The theme of this issue has been positioned as the big battle for the Indian customer between the Indian and the multinational in the world’s fastest-growing big market. Desi vs videshi!
Tata vs Toyota. Flipkart vs Amazon. Uber vs Ola. Who will blink first?
But is it really that? The consumer is the same. The products/ services are not very different. Even the material sourcing and manufacturing facilities are Indian for the better part. The managers are the same. So which is the videshi part of this big battle?
Is it then only about the brand names? Amazon is a global brand. Toyota is still the most valuable automobile brand on the planet. Do they have an advantage over the locals because they walk into the market on the back of their global reputation? Or is it about global best practices? Does the Indian consumer still put a premium on the systems that are developed in the west for a global marketplace? Is Amazon’s complex logistics construct (on both ends) difficult to best or even compete against?
So in the end is it about man and material (all Indian) vs recipe and reputation (origin based)?
What this war will come down to is whether the Indian pedigree and practices are good enough to take on the best in the world. It’s a big mountain to climb for two big reasons. The videshis start with very high standards on both recipe and reputation. Second, they are very good at smartly localising them. Think Maharaja Mac, Hyundai Santro or the redoubtable Maggi.
But as I have suggested in earlier columns, jugaad cannot compete with global standards or thinking. Air India under JRD, and Jet Airways in the 90s underscored this over two separate generations. World-class attention to detail and an evolved sense of customer engagement made them the pride of India and the envy of their competition.
I see this more recently in a home-grown retail brand like Theobrahma. Very premium pricing for their size and throw, but no one is complaining. Simply because they are that very good.
If the average Indian firm wants to compete with the best in the world, they can. Many of them are in fact more than good enough. They just need to stop bleating, short cutting and set the highest standards for themselves. This will not just set them apart in India, but ready them for a world of opportunity, literally. By the way, most of Jet Airways earnings come from its international routes. And it is not playing the volume game. It can be very often among the most expensive options on a given route. Passengers pay. They deserve their premium.
Indian businesses are spoilt. And I’ll tell you why. They have one of the most attractive, generously segmented home market available to any business in the world. They understand complex local conditions, customers and compliances, all of which are nightmares for the average global aspirant. They have readymade entry barriers which most markets can only dream of.
Why would you not drive that home really hard through high standards and world-class customer engagement?
Columnist
The author is president and CKO, EQUiTOR Value Advisory
