Most valuable 9 probable reasons for the failure of creating new business icons in India

Most valuable 9 probable reasons for the failure of creating new business icons in India.Recently an article has written by Malini Goyal of Economic Times gives five reasons why India has failed to produce next generation business icons.India has created enormous wealth in the past two decades. But being wealthy is not necessarily being iconic.Business icons are those whose presence and influence have gone far beyond their business.

 

They have acquired some kind of statesmanship, have high individual credibility and are very widely respected.Weigh the younger generation on these counts and most of them fail.We are trying to find out the reasons behind the failure to create new business icon in India.As we know that India has the large number of richest people in the world.

1. No New Sunrise Sector:-

Unfortunately, today’s business people are not able to come up with sunrise sectors.The first-wave-business-icons mostly emerged out of sectors that were new, not capital-intensive and were relatively free from government controls. Starting with the novel sectors like IT and telecom industries, these icons grew up as they were sectors where even newcomers with little capital could built up business empires in a short span of time."A rising tide lifts all boats," says Pankaj Ghemawat, global strategist and professor. The first generation businessmen who acquired iconic status rose at a time when India was growing rapidly. From almost nothing, the IT and BPO sectors are shining at $100 billion in annual revenue today.Ever since, India has not seen the rise of new sunrise sectors — unshackled from government controls — and that missing factor has become another obstacle for the Indian businessmen to achieve the status of business icons.The lack of proper reforms may be the reason for this. "The first wave of reforms in the early '90s created a lot of headroom for entrepreneurs to take advantage of. The lack of significant second wave of reforms since then may have constrained the emergence and expansion of other entrepreneurs," says Ghemawat.
From retail to aviation, the government is delaying the second-generation reforms, what the Indian economy needs badly. Such delay has made the new sectors to come in and it, in turn, holds back the rise of next generation business icons too.

2. Blame the Oligarchic Capitalism:-

India has witnessed a sharp rise in economy over the past decade, what the newly appointed Chief Economic Advisor Raghuram Rajan calls oligarchic capitalism. He also observes that India has the largest number of billionaires in the world per trillion dollars of GDP; where the predominant source of the wealth creation has been land, natural resources and government contracts. This very government-business nexus has made things difficult for new players to emerge iconic.Ruchir Sharma of Morgan Stanley, talks about the same thing in his book “Breakout Nations: In Pursuit of the Next Economic Miracles.” He writes in his book, "In the global media India is still closely associated with its technology entrepreneurs, but lately these dynamic moguls are getting replaced on the billionaire list by a new group: provincial tycoons who have cut deals with state governments to corner the market in location-based industries like mining and real estate."This ‘license raj,’ a way to access government patronage has been a key factor in shaping fortunes presently. But those who did succeed in this and became rich businessmen did not turn business icons as they failed to earn respect that many of their peers had from 1990s and continue to have even today.

3. Fewer Icons in Volatile Times:-

There is no doubt that monsoon brings more greenery on earth; likewise, when the time is good, more people are likely to flourish.Obviously, the post-9/11, post-Lehman and post-27/11 world and India do not provide good times for Indian businessmen. The politically, socially and economically disturbed times are not so hospitable for new icons to bloom.In a broader scene, Microsoft was tasting success, two decades ago, which became mere marginal when Google snatched its position in the market; meanwhile competing with Facebook. Apple, which was once the synonymous with success, now faces close competition from other similar brands. All these are not confined to the tech-world alone, but this is the fate of all entrepreneurs in the present scenario. And the India’s story is not different.Presently it is been observed that success is not so easy to sustain over a long time. When corporate tycoons are struggling with business challenges as Kishore Biyani of Future Group, they find it difficult to take their eyes off their business empires and focus on larger stuff.
However, there is something more specific about the last decade that made things difficult for new business icons to emerge in India.

4. Icons Take Time to Bloom:-

According to Adil Zainulbhai, India Chairman of McKinsey, it is not the aura of the first generation that makes it difficult for the up-coming business stars. But, he says, it takes time for the new ones to bloom and establish themselves. Enough time should be given to them to breed and make a name in the public.In the 90s, the era of first generation business world, people like Murthy, Mittal, Kamath,a andParekh were making money; but, none of them were iconic, instead, they were struggling entrepreneurs and executives who were fighting battles. They became business icons only over the past decade, when their businesses achieved a critical mass and they could get consolidated positions.Adil Zainulbhai further added, "We look at the past with greater clarity than the present. We identify winners in retrospect a lot more and better than in the present."Think of the '90s. Murthy, Mittal, Kamath, Parekh were making headlines but they were hardly iconic. They were struggling entrepreneurs and executives who were fighting many battles. Their larger-than-life image, their iconic status has only taken shape over the past decade when their businesses have achieved a critical mass and they have consolidated their positions. "We look at the past with greater clarity than the present. We identify winners in retrospect a lot more and better than in the present," says Zainulbhai.

5. Nothing Like the First Wave:-

In the 1990s, when India freed up its economy, the first generation entrepreneurs emerged in India such as Murthy and Nandan Nilekani—the co-founders of Infosys—from the middle-class to thrive for success. Most of these first generation business icons used their educational backgrounds and grand vision to script their success. They came up with their own norms of governance as there were less government controls.These first generation entrepreneurs, from K V Kamath to Deepak Parekh, Sunil Mittal to Murthy, led their companies and adopted values and high ethical standards that were the back-bone of the Indian middle-class. Almost all of them flourished in some sunrise sectors like telecom and IT industries, which didn’t have much competition from contemporary players and were almost free from government controls.Thus, these first generation business stars, focusing on novel sectors, played ethical yet ambitious games and turned wealthy; and yet retained the middle-class ethos.

6. Less government inspiration:-

An entrepreneur that shuts down a failed business and then starts a new business has likewise completed a step toward becoming free to live life by their own rules. Their future success starts at the point many quit in failure and flee to the false safety of a job. That's persistence.But there is no such assistance is come from government side when an entrepreneur has failed his/her first own venture,no body has come forward to restart his/her new venture.Governments know they own the local monopoly on violence. They use that power to indoctrinate, tax, and control.Government determines if their customer's dreams and ambitions have a hope of becoming real. Customers are not indiscriminate cows to be milked or butchered as managed herds. Customers are individuals, any one of which may cure cancer. write poetry, create a new style of business, or solve pollution -- if their art is not constrained by fences forcing them to act like all other cows.

7. Less risk coverage:-

Education, training, passions, hobbies, interests, or creative ideas are a great starting point. Since it will be spending time, money, and effort as struggle toward business success - choose to do something that can do with enthusiasm. Focus on the top two or three passions; the joys of pursuit can help through rough periods.But a few well educated youth tak this risk to start his/her own business.Normally they want a good job with high salary.

8. Lack of well furnished project planning:-

Comprehensive up-to-date coverage for new business Project is needed for any business but it is seen that business Projects are like news stories and which has no in-depth coverage with out videos and photos , service, office space, services,graphics and more.

9.More emotional & traditional:-

Indian people are normally more emotional either in business or any where.So they take the decision emotionally which may not be realistic or real time update or back dated.Indian gives importance on traditions than any other factors.This is one of the core factor of business failure.

Reference:-

1.Economictimes by Indiatimes
2.Siliconindia