Convocation Address of by Shri Kumar Mangalam Birla, Chairman, Aditya Birla Group; Chief Guest for the 6th Convocation of EDI's Post Graduate Programmes held on 18^th September 2004.

However, latching onto the value chain can be a good start for a small business, but it is just that – a start. Eventually, the fledgling business has to sustain itself – and that means it has to keep innovating, keep moving up different capability ladders. Long-term survival also requires that the firm be able to make a switch to entirely different value chains, using the competencies it has developed. Let us look at one example of how entrepreneurial firms have positioned themselves along the value chain.

East Asian electronics manufacturers have been moving up and across value chains for a number of decades, with each move taking them onto higher levels of technological competence and value addition. Enterprises in Taiwan and South Korea have mastered – over the past four decades – the skills to keep moving – from transistor radios to calculators to televisions to computers to laptops, and now to Wireless Application Protocol telephones. And at present, the East Asian companies are selling the products under their own brand names. In effect, what started of as small enterprises, are now high-profile multinationals.

ISSUE-2 : DEEPENING THE CULTURE OF ENTREPRENEURSHIP

So that, for us, is one viable approach for entrepreneurs in an age of globalization. Let me now turn to the question of how do we get more of our young people to want to be entrepreneurs.

While there have been many success stories, I believe that the entrepreneurial attitude still meets too many roadblocks in India. Our societal norms accord primacy to attributes such as a steady and stable individual career path, reduction in the levels of uncertainty and ambiguity, an aversion to failure, and the desire to ‘fit’ within a certain ‘mold’. Hence, only a very small proportion of the educated elite in India opts for entrepreneurship as a way of life. Even in the case of those who do become entrepreneurs, most of the ventures are clustered around businesses that are more predictable and stable. Few entrepreneurs go for the jugular – the breakthrough.

What do we need to do, so that social and cultural attitudes are more entrepreneur-friendly?

First – a good starting point is to reorient our system of education. I believe that a key factor that may be acting as a brake on the entrepreneurial impulse could be the nurture factor – and I am thinking of the system of education, through school and the university. The system tends to reward rote, mechanistic learning. Critical questioning and back-and-forth dialogue are largely absent, while the creative instincts are stifled. The educational process is biased towards finding ‘correct’ answers, rather than examining a range of possibilities and experimentation. Such a rigid learning environment hardly makes for excitement. The mind is therefore steered, at a very young age, towards conformity. As a result, the spark of entrepreneurship starts getting doused quite early on in life.

Second, our key institutions must interact more with each other. Today, the boundaries between the university, business and government laboratories are sharply demarcated. There is hardly any flow of ideas – or talent – between the university research lab and applied research in business. Potentially good ideas therefore stagnate for want of an airing. The result is that some of the best entrepreneurial talent finds that it has to leave India, in order to be able to strike it big. This situation may be changing, but not quickly enough. The infrastructure for entrepreneurship – a solid core of university-led research, the venture capitalists, the willingness by business to take and build on the research and take it forward into the commercial arena – all this is still substantially lagging in our country.

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