Research on topical entrepreneurship related subjects with special focus on applied research are taken up to act as a crucial link between theory and practice in the field of Entrepreneurship. The aim is to offer a thorough practical knowledge in the field of Entrepreneurship apart from the theory.
In order to broaden the frontiers of Entrepreneurship Research, EDII has established a Centre for Research in Entrepreneurship Education and Development (CREED), to investigate into a range of issues surrounding small and medium enterprise sector through its publication, "The Journal of Entrepreneurship". CREED also establishes a network of researc
GEM research project is first-of-its-kind, revolutionary effort at assessing the levels of entrepreneurial activity prevalent in different nations of the world and linking them to the entrepreneurial framework conditions of the country on the one hand and projected economic growth on the other. The project was initiated in 1999 by the London Busine
DST Policy Research
Conference & Seminars
The main objective of the working paper series of EDII is to help faculty members/researchers share their research/study/project findings with colleagues, as well as test and receive feedback from them at pre-publication stage.
EDII seeks to develop knowledge that encourages innovation and replicable models through various Government and Corporate Sponsored projects. These projects include those assigned by the Central and the State Governments, development organizations and public enterprises.
EDII acts as a catalyst in building an individual’s skills and knowledge base to a greater capacity towards entrepreneurial success. Our main aim is to reach various target groups and provide value added services and build their capacity and help them set up independent enterprise.
The youths underwent focussed learning along with hands-on experience to gain knowledge, skills and the confidence needed to enter the market either as an employee or as a micro entrepreneur. To ensure that the youths do not begin with an ill-defined business model, they were introduced to opportunities in the automobile sector; self-employment in
Effective, accountable and inclusive institutions are essential to achieving sustainable development goals. EDII realised this need to create a network of Entrepreneurship Development (ED) institutions to ensure a ripple effect in India and abroad.
The Entrepreneurship Development Institute of India As EDII moved on to adopt the role of a national resource institute in the field, it realised the need to create a network of ED institutions that could adopt this activity and make it widespread. This institutionalisation also enabled EDII to make a decisive dent into other areas backed by furth
EDII vision also advocates the strategy of institution-building for forging entrepreneurship as an International Movement. The Ministry of External Affairs, Government of India had assigned to it the prestigious task of setting up EDII-like Entrepreneurship Development Centres (EDCs) in Lao PDR, Cambodia, Vietnam, and Myanmar (CLMV nations).
Shri Yashwant Sinha, Former Finance Minister of India & Chief Guest of the 1st Convocation in the year 1998-99 (Convocation Speech)
Sh. G. P. Gupta, President, EDI and Members of Governing Body, Dear Students, ladies and gentlemen.
I am delighted to be here today for the convocation for the Post-Graduate Diploma. Let me first congratulate the students who have earned this diploma and those who have been awarded special recognition through other awards. I also want to recognize your families and teachers who have worked hard to support you.
I compliment the EDI and its Governing Board for conducting this diploma programme which focuses on entrepreneurship, covering such areas as new enterprise creation, entrepreneurial management, family business management and launching and managing an NGO. Each one is crucial.
The EDI has been spearheading entrepreneurship development throughout the nation with a belief that entrepreneurs need not necessarily be born but can be developed. Today I will talk to you on how to achieve this in our rapidly changing global economy. And how we must strive to create more global leaders like Zee Telefilms, Infosys, NIIT and Ispat.
Let us first examine the economic environment that you will have to deal with. Globalization and technology are transforming our economy. The process of globalization arises out of the interaction between market and technology related factors as well as economic policies at national and international levels. This in turn has exerted inordinate influence on the existing patterns of economic development in virtually every country.
Information technology has led to lowering of costs and the dramatic shortening of economic ?distances?. New communication technologies have facilitated the diffusion of new production technologies at low cost, allowing faster and cheaper movements of goods and services. Advances in telecommunications and transport have helped to lower the costs of communication and transportation while the emergence of fax and global computer networks has drastically reduced economic significance of geography. At the same time, systematic rationalization of procedures and documentation for international trade, together with wider and easier dissemination of information about prices of traded goods has contributed to the convergence of market prices, resulting in fewer distinct markets.
As the new global economy takes shape creative entrepreneurship has a critical role to play. It is obvious that most of the ideas that determine entrepreneurial principles and business decisions in the past shall have to make way for new practices. Accordingly, entrepreneurial activities will change in the years to come. Technocrats and professionals, equipped with knowledge and state-of-art technology, shall replace the traditional business people. This new generation of Managers will mould Indian industry. And technical education will acquire a new dimension as Internet technologies become significant in determining growth and prosperity of business.
Indian business has been traditionally dominated by family enterprise. However, the changes I mentioned will alter Indian business by creating many new enterprises dealing in new products, possessing new technology and capital sources, employing new personnel and functioning in new, unexplored markets. It is here that the modern generation of entrepreneurs have a vital role to perform. They can take advantage of liberalisation and economic restructuring by harnessing application of new skills and abilities at the grass root levels.
At this juncture, I would like to point out two traits of Indian business which, unfortunately, have not served the industry well in the past. First, several entrepreneurs seem to be too complacent. There are instances of overconfidence leading to over-ambitions expansions and diversification into unrelated lines. These are mistakes that Indian entrepreneurs cannot afford. They must be aware of the changing circumstances arising from emergence of new products, technologies and competition and concentrate their efforts in carefully selected products and markets.
Second, a section of Indian industry fears that Indian enterprises can never expect to compete on equal terms with their foreign counterparts. It is true that MNCs have sizeable resources for deployment in production and marketing but Indian industry has decades of industrial and entrepreneurial experience. In our local markets this invaluable experience can enable Indian firms to develop effective strategies. Instead of fearing competition Indian business must realise the opportunities created by Indian markets. The new managers of today, endowed with skills imparted by the technical institutes of the country, can successfully carve out niches for their enterprises, at home and abroad.
But in doing so, the entrepreneurs must keep in mind the basic rules of the game. High competence has to be matched by high levels of integrity. Organisations of entrepreneurs, like chambers of commerce and various associations, have to be vigilant and ensure that entrepreneurship is well-focused and truly professional. Well-groomed, educated and carefully selected entrepreneurs, such as yourselves, are our future leaders and must conduct themselves accordingly.
International competition has become a fact of life for Indian industry today, and industry must live in this environment. In the process of being internationally competitive and being able to face international competition is the need of the hour. The key aspects of this process are :
Benchmarking against the best global companies.
Making the organisation more responsive, lean and competitive.
Employing the best talent.
Divesting from business which was not adding value. The motto should be ?fewer things better?.
Today?s entrepreneur must understand the new rules governing competition. In this dynamic economic situation, the attractiveness of respective enterprises and countries will depend on their ability to adapt quickly through constant innovation. Internet technologies and outsourcing are two trends that are driving innovations today.
Today?s entrepreneur must realize that application of internet technology can greatly facilitate implementation of management techniques such as ?just-in time? inventory management and other working capital management techniques, making the operation of an enterprise more cost-effective. The internet has also provided alternatives for advertising and the operations of business, and can be expected to evolve into a full-scale computer-operated business environment. And this is available in the English medium in which we have a comparative advantage.
Outsourcing involves provision of services and the manufacturing of components in companies outside the factory location and then assembling them in the principal?s factory. In its extreme form, the so-called virtual factory system has made it possible to manufacture any product at any time in any factory worldwide, with all the engineering specifications and invoices being transmitted electronically. A typical network includes not only a parent firm and its affiliates, but also its suppliers and sub-contractors, its distribution channels and value-added retailers, as well as its research and development alliances and a variety of cooperative arrangements (such as standards consortia).
Covering the major forces shaping our economic environment, let me explain how policies have been designed to help Indian entrepreneurs and business.
In the Budget for 1999-2000, I have emphasized the need for higher investment in venture capital activities for boosting hi-technology sectors and supporting entrepreneurs. Various initiatives have been taken to increase the attractiveness of the venture capital scheme so as to induce high net-worth investors to commit their funds to the sunrise sectors, particularly the information technology sector.
I have also proposed a National Fund for helping innovators all over the country. To me, entrepreneurs are innovators par excellence. I am sure the entrepreneurs will take advantage of this fund which has an initial corpus of Rs. 20 crore and will help build a national register of innovations, mobilize intellectual property protection, set-up incubators for converting innovations undertaken by entrepreneurs into viable business opportunities.
I would like to mention that the Govt. is determined to create an enabling environment for allowing entrepreneurs wide scope to use their skills. Government has implemented measures to create a level playing field for domestic entrepreneurs and promote competition. A few of these measures are ? reducing the number of industries coming under the purview of compulsory licensing and the public sector, proposing review and amendment of the Industries (Development and Regulation) Act and the MRTP Act and putting in place a new competition policy. We are expanding the list of industries eligible for automatic approval of foreign investment, proposing to establish a Foreign Investment Implementation Authority, deciding on large scale disinvestment of Government holding in selected Public Sector Enterprises, rationalising the indirect tax structure by reducing the rates of excise and customs, providing major fiscal incentives to infrastructure and housing sectors, taking concrete steps for improving regulation and ensuring transparency in the capital market etc.
The process of liberalisation is irreversible and more reforms will be taken up in future. But I would like to emphasise the role that Government envisages for itself in the new growth process. It would be more of a ?facilitator?. Greater resources and participation of the Government would be directed towards the social sectors with the objective to positively effect literacy, health, drinking water, sanitation, housing and human development as a whole. The onus of exploiting the benefits of the new policies and reforms in general is upon the industry and its entrepreneurs. They must come forward to reap the advantage of a market-friendly and pro-business policy of the Govt.
I would now like to touch upon an area which, I believe, shall be of special significance to the entrepreneurs and managers of tomorrow. The small scale sector is a vital segment of our industry. This sector has not only diversified the pattern of industrial growth but has also created ample employment opportunities for the skilled labour force of the country. Small scale has been a priority for the Government and several measures have been announced for promoting this sector. These include, increasing the composite loan limit for the SSIs, opening of more specialised SSI bank branches, awarding greater powers to bank managers for quick disposal of credit applications, proposal to launch a new credit insurance scheme for the SSI sector, consideration of lending by banks to NBFCs for purposes of on-lending to the SSI sector as priority lending, review of the impact of Delayed Payments Act, dereservation of selected items reserved for exclusive manufacture by the SSIs etc.
In this context, I would reiterate the Government?s resolve to make the liberalisation process a people?s programme ensuring participation of people at all levels. Micro-enterprises, NGOs and SSIs have vital roles to play in this regard. I would request the entrepreneurs of tomorrow to take note of the enormous potential of the small scale sector and the steps taken by the Government for enhancing this potential. It is this sector that is likely to offer the most significant opportunities to the new entrepreneurs for utilising their skills and faculties. But please learn to compete and not hide behind an unjustified protective shield. I would like to point out that there are several areas in our economy which require more reforms. One of these is the financial sector where high rates of real interest continue to affect consumer prices. Many of the existing labour laws have become archaic and need to be amended to suit the changed economic circumstances. These and other measures shall form part of the second generation of economic reforms which are proposed to be launched as soon as possible.
Despite the many problems we still face, we can justifiably take pride in our economic achievements. However, what we have achieved so far is only a stepping stone to greater achievements in future. The recovery by the economy has underlined the efficacy of the policies adopted. There will be more reforms aimed at creating a high-growth environment. I hope the managers of future would participate actively in the growth of the Indian economy and try to utilise the new opportunities to the best of their abilities.
The best technology, the best talent and the available capital will all go to business which look after their stake-holders? interests. The Indian investor, consumer and manager have revealed their preference by moving to companies which are investor-friendly and consumer friendly and who adequately reward their employees. You will need to imbibe these qualities and ensure that they become an integral part of your companies.
The challenge today lies in development of entrepreneurship which can stand upto global competition. I am confident that you will seize your destiny and go on to create great companies. Our hopes and dreams are in your hand and we will support you in every possible way.
I wish you all the best for the future.
Shri Subhash Chandra, Chairman, Zee Telefilms Ltd. & Chief Guest of the 2nd Convocation in the year 1999-2000 ( Convocation Speech )
You will agree that the success of any programme/ project rests on effectiveness, vigour and efficiency with which it is implemented. With regards to the 1-year course, the PGDBEM, it is exactly this that has been our prime focus. The performance of each student was continuously measured against planned goals and targets. By putting in use various modern teaching techniques, the students were taught to conform as closely as possible to the set goals.
The primary concern, i must say, had been to bring about all round personality development by imbibing the traits of a competent entrepreneur. An important aspect of the course, oriented at achieving its goals as also to usher the students to become competent businessmen, had been `motivating success stories of great achievers'.
An insight into the success story of an achiever of the stature of Shri Subhash Chandra will undoubtedly leave the students motivated and determined. May we request Shri Subhashji to give us a glimpse into the various important events of his life, in his address on the occasion of the convocation on July 22, 2000.
We are giving below a brief framework in case Shri Subhashji would like to use it or substantiate it in his speech for the day.
Emergence of an entrepreneur, it is said, rests on
Childhood grooming - Shri Subhashji is from a family of entrepreneurs. Perhaps discussions on business formed a part of his growing up. How did these influence him?
Education and training - a leading publication 'Asia week' in its issue dated 1/21/2000 reported 'Chandra was not much of a student, so at 19 he plunged into the family foodgrain business in hissar ???'
He entered the family business at 19 and soon after decided to jump into a very difficult sector which no one had attempted before in India. With no formal education on management or related field, it must have been difficult for him to solely trust his entrepreneurial spirit and tenacity. Perhaps he would like to focus on this.
Environmental factors such as policy framework - when he decided to provide an alternative to doordarshan's insipid programming, there were many restrictions in the Indian laws, which were not allowing him to venture into this untrodden path. How did he make things work?
Personality qualities - Shri subhash Chandra?s belief - 'paths are made by walking and walking down beaten paths is for beaten men.' his was the first Indian firm to make laminated plastic tubes and to follow it closely was the zee TV. He attempted something that no one in India had attempted before. What are the personality traits in him that give him this amazing vigour and confidence?
Familial and non-familial influences - Shri Subhashji may perhaps like to focus on the support received and apprehensions of his family and friends when he announced mega plans of his novel project. Was financial support easily available? Who were the principal actors or what the principal factors that kept up his motivation were.
Role of unprogrammed strategies (heuristics)
Experts & analysts were of the opinion that news corporation - zee telefilms 'deal' will result in a company that will not only be a world class media conglomerate but a corporate blue chip and that Mr. Murdoch sure wanted a pre-eminent role in the Indian entertainment and media sweepstakes. Unlike stories that were in circulation not very long ago - 'Murdoch dictated terms to Chandra', today analysts without any scope for speculation hold that the post deal field is open for Chandra to emerge as India?s undisputed media mogul.
Implementation of strategies in such times as also when it came to contending with crises in day-to-day activities, such as; staff related areas etc., is beyond the comprehension of analysts. Unless Shri subhashji himself throws some light on these they remain a mystery.
He may perhaps like to focus on
His future plans and as to how will the much talked about deal with the global media baron, Rupert Murdoch benefit.
Businesses are not necessarily unethical
Perhaps he could like to substantiate this point with his own achievements?
From being an entrepreneur to a philanthropist
The world knows subhash Chandraji as a noble man who has a heart for the needy and the poor. He has set up taleem research foundation & plans to launch a television programme to impart primary education to children in 10,000 villages in northern India. Quoting a report dated 11th June 2000 in Indian express, `Chandra said as investors, whether domestic or foreign, it was necessary to be sensitive to the needs of the people'.
May we request him to share the advantages & disadvantages of such a transition?
The passing out students are going to step on the difficult grounds of business. Could he share his views about the industrial scenario in the next 5 years? Also could he give his advice to these passing out students who have plans to venture into their chosen fields very soon?
Shri Sunil Bharti Mittal, Chairman & Group Managing Director, Bharti Enterprises and Chief Guest Of The 3rd Convocation In The Year 2000-01(Convocation Speech)
When I received the invitation for this function, the first thing that struck me was the unique work that this institution is doing. I was impressed. Besides, my visit to Ahmedabad was long overdue. And a lot has happened in relation to Gujarat, since I accepted this invitation. So this invitation indeed proved lucky for me.
The stars of today's evening are the graduating students and with them I would like to sharethe pains and gains of my last 25 years of entrepreneurial career.
Gujarat is the fountainhead of entrepreneurship and the place where I hail from, i.e. Ludhiana is also very much alike. Ludhiana is a reservoir of entrepreneurs, so to say. When I decided to enter the world of business, in Ludhiana, practically everyone was into the bicycle business here and so it was bicycle for me as well. With a small investment of Rs. 20,000 and with a good friend as partner, I ventured into bicycle parts manufacturing in the year 1976. Let me tell you that the first 2 - 3 years were tough. But I knew I had to be moving ahead and so in 1979 I left for Bombay and got into import of a variety of products to be used in the country. Money then had a lot of value.
From here, I saw an opportunity in import of portable generators - an opportunity which I eyed upon during one of my visits abroad. We became the largest importers of portable generators and remained at this position for 3 years, until one fine day the government banned the import of portable generators.
I was again in search of an opportunity. At this point in time, I was certain about one thing, which was that whichever product I take up, it had to be new and innovative; something that none had taken up before. And around this time during one of my visits to Taiwan, I chanced upon push button telephones. I immediately knew this would work because it was a purely new idea for India then. We started importing push button telephone sets. First wave of liberalisation came in the form of manufacture of push button telephones and every big company jumped into telecommunications. There was not a great chance to succeed but we were the first to launch push button telephones and today we are manufacturing 4 million telephone sets. We are the 3rd largest in Asia now.
In the year 1991, we were struggling, doing well and manufacturing good telephones. Bharti had started with an investment of 19 crores and today it is a 2000 crores company.
It was in the year 1992 that I got a unique opportunity. I believe every entrepreneur gets one opportunity in his lifetime, which he has to grab. This may involve taking risk also but then without risk there is no success in business. So for 3 months I took leave from office. I told my two brothers, who are working with me and other officials of the company that I should not be asked for anything; no one should ask as to where am I. This opportunity had come in form of licences of 4 metro cities for mobile phones.
We formed a loose consortium. Did all the necessary surveys spending around 300 crores, did our analysis and put in the bid. Practically all the big names of the corporate world were our competitors here. But our efforts paid and the result of this went in our favour and we were awarded all the 4 metro licences, so much so that the government had to intervene with the argument that all 4 licences could not go to one single company.
We were the first to launch mobiles. Today Airtel is most successful. The Delhi success took us 20 years ahead.
But there is one thing which we forget in our success and that is to sustain this success. In the last couple of years I have seen so many of my friends rise like stars and also fall to the ground in no time. To fall is very easy and therefore one must not ignore this side of the business and keep strategising constantly. I am aware about this aspect and have an eye on this always.
In the last few years of my career, there have been times when I have required large amounts of money and I have succeeded only because the risk taking spirit and the conviction were there.
We talk about the prevailing recession around, but Bharti has raised 1.05 million dollars in the last 9 months. This has been possible only because of high level of credibility that we have developed in the eyes of our investors.
Even in my office, we have created a wonderful environment. We have this Monday morning syndrome running high in employees, where each one is eager to come back to work on Monday. Every employee, right down to the level of a peon has a right over the company. If at all I wish to insist on my right as an owner, it will be only by way of becoming a share holder. There is complete transparency in the system at Bharti. I do not remember having signed a cheque for a very long time now. Even cheques worth Rs. 9 crores have been issued by the Accounts Department of the company after the signature of two signatories. A cheque comes to me only when one of the two signatories is not available.
The passing out students are lucky to have gone through this training. There is no short cut to success, I must tell them. All aspiring people should have both the short term and long term vision as both these are indispensable for success. The will to perform should be there because the only way to succeed is through performance. Fear and Greed propel individuals towards performance and success. One of these things is always at play. When we are young we perform in schools out of Fear of being admonished by parents and when we grow up Fear of losing what we have acquired drives us; or sometimes performance is also encouraged by Greed, i.e. a Greed for Recognition.
I am happy that this institute is grooming young people, so perfectly. The course 'Management of NGOs' particularly struck me because the right NGOs can become the right kind of pressure groups. It is remarkable that some students here are following this. I wish them luck.
Once again reverting back to Bharti, I would say I am a first generation entrepreneur and it is unlikely that my children or my brother's children will succeed me. Mine is a very professional company and I believe in professionalism. I also have faith in the fact that entrepreneurs are born and can also be trained and developed. Personally I am an impatient man; a thing has to interest me to hold me. I have done my bit and if I feel like giving it all up in the next few years I will do so and start all over again.
Today Bharti is covering 15 states and 700 million people and for the next few years also we have mega plans.
To the students here I would like to reiterate what Mr. Kapur has already mentioned, i.e. one should always be concerned about one's own health because only a healthy mind can work well. Leaders need high energy level whatever be the age. An energetic mind is one of the formulae for success. Amongst the other formulae I would say that in every area an aspiring person should be 10% ahead of competitors. Then there is Speed and Perfection. If one has to choose between the two, Speed should always be the first choice because if we concentrate on maintaining Speed, Perfection will always follow.
In the present times, these graduating students are needed or should I say, these entrepreneurs are needed. They are needed to break the 5% - 6% G.D.P. and contribute to the success of the nation. I wish you all the best for your future.
Shri Brijmohan Lall Munjal, Chairman, Hero Honda Motors Ltd. And Chief Guest Of The 4th Convocation In The Year 2001-02(Convocation Speech)
"At the outset I must thank Dr. Patel for inviting me to the function. Before narrating some of our experiences at Hero Group, let me congratulate and compliment the students of all the three streams (New Enterprise creation, Family Business Management & NGO Management) who have received their PG Diploma today.
I was happy to see young entrepreneurs walking away with their certificates. These students, no doubt, are extremely fortunate. In our days none of these facilities were available. We learnt from each and every one who could give us some knowledge and information regarding an enterprise or its functioning. Our teachers were - our suppliers, our vendors, our buyers and our peers. There were no books on the subject. Every single aspect was learnt from experience and trial and error method.
To go out and become an entrepreneur was not an easy task. We brothers, for our livelihood joined jobs but soon realized that we were a different material. Service ws not our cup of tea. So we picked up bicycle components trade to begin with. Like others, we went through difficulties, worked hard and never gave up. Jemshedji Tata was our national role model.
India dhad just attained Independence, and everyone was preparing to venture out and be part of national reconstruction. For few of us it was nearly a compulsion as we had lost everything in partition.
The social atmosphere then was such that, a large section of the society did not look upon entrepreneurs with the same respect as public servants or people of other profession. Therefore, the achievements of entrepreneurs of those days have to be judged by the circumstances that prevailed in the early years of independence.
But things rapidly improved. India's first Prime Minister, Pandit Jawaharlal Nehru and the architects of India's Five Year Plans realised the centrality of the role of entrepreneurs. The country for some time did lack clear-cut policy on enterprise development, but it was more than compensated by the initiatives of the political leaders and bureaucracy. I have several instances of Punjab Chief Minister Shri Pratap Singh Khairon taking proactive decisions to help entrepreneurs of the state.
Not everybody can become an entrepreneur even if one desires to do so. I don't mean to say that he or she should be a special person; but should be a person who has an uncanny knack of identifying an opportunity and be able to take appropriate risks at the right time.
Having said that let me qualify my statement that all of us are gifted with some or the other natural talent. Some are able to use and benefit from the talent directly and in some other cases some supplementary help is required for the use of the same. Recently in an international forum I was asked as to whether an entrepreneur is born or made" ?
The question looks as though it is riddle of "chicken or egg first". There is no "either-or" case in the real world. There are both types of possibilities and instances.
Take for example Soichiro Honda the founder of Honda Motor Company, Japan. He was a great innovator and a man with a vision. He toured all over the world to look at various technologies; innovated 4-stroke small engines; became a racer to understand the technological needs of a racing bike. I have not come across such an adventurist in my life. But not many people know the other side of Mr. Honda. He had poor business acumen. All his early ventures utterly failed. Only when he joined hands with his friend Mr. Fujimura, the real entrepreneur in Mr. Honda was born and the enterprise they started together became a stunning success without a parallel.
In another instance we have the example of Bill Gates who is a born entrepreneur. What he started, as a business initiative in a garage, is today the best-known "rags to riches" story in the world. In his case his zeal to start up something on his own did not wait till he completed his degree.
Last year, a young innovator was chosen as the world entrepreneur of the year Ernst and Young. And that 34-year old gentlemen had starte developing a very special software graphics at age of 19, which was applicable for advanced medical treatments (Cancer).
Thus there is no exclusive qualification that makes you a successful entrepreneur. There are all kinds of possibilities.
Coming back to the experience of Hero Group, as we grew and expanded our business, we brought into the folds many friends and associates as our dealers, ancillaries, vendors and suppliers. We provided them technology, and in some cases finance as well. For the last 45 years they are with us and in many cases new generations have taken up the business of those ancillaries and still continue to supply us components.
Sometime people ask me - How is that you practiced JIT and best productivity in 50s, even before the concept got evolved ?
Actually we had to respond to the economic and market conditions that prevailed in those days. (Dr. Alagh can bear me out on this) Money and credit was quite scarce then, not like today. So we wanted to use all scarce resource in the best manner to improve our efficiency. We could not afford inventory. At the same time we were not in a position to price the bicycles higher as it was a mass transport product. In addition there was good bit of competition.
There is a cultural angle to what we practiced. As a tradition people in our area seldom resort to credit. They always start small, with their own funds and try to come up. The innovative efforts of Ramgharia's needs to be emphasized here. They fabricated lots of machines and saved foreign exchange for the country. That is why Ludhiana industry is relatively efficient and low cost.
Using this strength of Ludhiana, we created a hub of ancillaries around our facilities, so that we got the components in time and at regular intervals. Certain raw materials like steel sheets and tyres used to come from far off places and sometimes created mismatch with our prduction planning. So we persuaded them to open depots in Punjab for timely and regular supplies.
High Productivity and low inventory in our operation was one of the criteria why Honda joined hands with us. There is a big lesson here: wherever there is sense of mentoring and sharing, business not only grows but sustains.
Relationship management is one of the strengths with Hero Group. The relationship and bondage of our companies gets extended to the dealers, customers and employees. All across the Group there is just one philosophy - that is, all stakeholders are part our large extended family.
Now-a-days there is a general impression that choosing this career is a route to overnight rags to riches story. Barring few exceptional digital ventures, normally it is a long-=term proposition. One must have patience; application and ethical dealing as we progress to build our organisations and this is the recipe I prescribe to the people who would like to build great organisations.
One of the important things that we at, Hero Group, practiced and promoted was running the business on ethical values and in a transparent manner. It is only now that we have "corporate governace" and other appropriate regulations in place but from the very ebginning our company had some of these principles clearly spelt out. In building cultural values in our companies we had a great bit of influence from our elders on issues like respect for individuals, sense of sharing the benefits, caring the employees and customers and spreading the spirit of teamwork.
"Ethics is not definable, not implementable because it is not conscious; it involves not only our thinking but our feeling".
Therefore, ethics is more of a self-discipline. It cannot only be enforced by law. Recently, delivering the First Raman Munjal Memorial Lecture, my friend Mr. N.R.Narayana Murthy said, "ethical behaviour is doing what is best in enhancing the trust and confidence between two entities, so that, both the entitites feel energized and enthused to work towards the betterment of the common good".
In recent years there is a greater emphasis on corporate governance with the intent of enforcing transparency and fair play in the business dealings of enterprises. If equally responsive administrative governance supports good corporate governance, I am confident that India will match the performance of any industrial society in the world. We have all the skills, intelligence, human resource, and large domestic market as conducive factors.
I was going through the curriculum of EDI and I was happy to see some students who had specialised in family business receiving the Diplomas today. This is appropriate because even in developed countries like United States nearly 60% enterprises are still family run. In India too we have large number of entities which are family run. With young generations coming in, it is more imperative that institutions like EDI run such specialised courses.
Another thing I would like to caution people in business and I always advise my children and grandchildren not to entertain complacency. Because there is adanger that we may miss certain timely decisions and also we may lose trust of the people around us. Complacency means we are resting on our past achievements and taking life easy. One must be sharp and accept success with due humility. After all at end of the day the entire effort is team work. I myself accepted the Ernst and Young Entrepreneur of the Year Award on behalf of everyone who worked for my organisation.
I feel, at some stage, it's also the responsibility of the enterprises to be responsible corporate citizens and do their best to the society. Along with the growth of the Hero Group, we have promoted schools, colleges, health facilities and other necessary social infrastructure to make the area around us developed.
I hope the examples that I have cited would provide some guidance to the entrepreneurs in the making. I also wish that government and society recognises the risks and struggle undertaken by the entrepreneurial society and would create appropriate atmosphere for promotion of young entrepreneurs, which I think is a long-term solution for the development of India.
I also would like to say a few affectionate words to the new entrepreneurs who will be joining our family, that till now you were protected and supported by your parents. They looked after your needs and your aspirations. But soon you will be on your own. The world is open for you to experiment and realize your goals. Do not hesitate to do what is right according to your conviction.
One should not unnecessarily compare and one should have a sense of dignity in whatever one does. I know some friends who have picked up the simple job of supplying fruits and vegetables, cosmetics and toiletries to hotels and have become millionaires.
Do not forget one thing; be principled and singularly committed, and then the entire turf is yours. This career will change you and you will have the opportunity of improving the living conditions of the people touched by your products and organisation".
Shri Anil Ambani, The Then Vice-Chairman And Managing Director, Relience Industries Ltd. And Chief Guest Of The 5th Convocation In The Year 2002-03(Convocation Speech)
Good afternoon, Ladies and Gentlemen:
At the outset, I would like to thank Shri P.P. Vora, President, and other members of EDI, for giving me the opportunity to be present here today, to meet the bright, young leaders of tomorrow, and to share with you, some of my thoughts, on the fascinating subject of Entrepreneurship. First my heartiest congratulations to all of you, who have successfully completed, post-graduate programme, in Business Entrepreneurship and Management. You are now poised to embark upon a new, challenging and, I am sure, hugely rewarding phase of your life.
My best wishes to each one of you, as you embark on this exciting journey. My dear young friends - India is a land of great opportunities - opportunities that are perhaps incomparable in the world! You are doubly fortunate to be starting your life, at an exciting time like this - the world's eyes are on India, new business opportunities are unlimited, and economic reforms have unshackled the chains on creativity and innovation. We are a very young nation - just over 55 years since independence - setting out on a path of sustained economic growth, for decades to come. We already have over a billion fellow Indians. Within the next 20 years, we will have 400 million people below the age of 35 years - more than the entire population of the United States! Each person, in this bold new generation, will be in the prime of his or her life, striving for a better tomorrow - creating, in the process, new growth opportunities for budding entrepreneurs like you !
On the most conservative basis, our domestic consumption, in virtually any sector, has the potential to at least double, or treble, from current levels - perhaps, just to catch up with a country like China !
And then, there is the entire global opportunity ! Across diverse sectors internationally, the "Made in India" tag is now an increasingly respected brand, valued for quality, reliability, and competitiveness. Truly, with economic reforms in the country, and with the virtual removal of all trade barriers, the world is now our market - and our opportunity! The pursuit of these opportunities requires an indomitable spirit of entrepreneurship ! And, to be a successful entrepreneur, you have to identify opportunities, that have either not existed before, or have not been noticed before by others ! It is often said, people, who are crazy enough to think that they can change the world, are the only ones who actually do !
My father, Dhirubhai Ambani, a proud son of this glorious state of Gujarat, and a man with long ties with this wonderful city of Ahmedabad, was the greatest example of this spirit of entrepreneurship ! In a short span of less than 25 years, and without even the benefit of a formal education, Dhirubhai Ambani built Reliance, a first generation enterprise, into one of the world's 200 most profitable companies ! He started out in life, working as a mere petrol pump attendant in Aden, Yemen. He had no technical knowledge of any of the businesses he wished to create in India. He had just five hundred rupees in his pocket, a vision of what he wanted to achieve, an intrinsic faith in the latent demand potential of the Indian markets, a belief in the capabilities of Indian people, and a burning desire to succeed ! The end result ?
He created Reliance, a Rs. 75,000 crore enterprise, in a single lifetime ! We must, each one of us, take inspiration from Dhirubhai's extraordinary life, and challenge ourselves, to build on his achievements, to fulfill his desire, of one day making India an economic superpower.
I would like to now share with you, some of my own thoughts on entrepreneurship - especially, things that do not, normally, form a part of the curriculum, at management institutions ! I believe the first, and perhaps the most important, requirement for success, as an entrepreneur, is a passion for your work - to be able to look forward to every new day of work with a sense of optimism, with a sense of purpose, with a sense of challenge, and with a view to enjoying the work you are doing. I have found that the happiness, which comes from this passion, and from the achievement and recognition that follows, is more lasting, and far surpasses anything based on earning a little more wealth, or obtaining greater material comforts. Of course, it is not enough for just you, as an entrepreneur, to have this sense of romance about your work.
What is important is to get the entire organisation seized, with this same sense of passion, and enjoyment, for work. It is one of the most commonly accepted myths of our times that entrepreneurial success, is all about entrepreneurial abilities of an individual. In reality, far from being a solitary pursuit, entrepreneurial success is a highly collaborative process. A good entrepreneur has to bring out creative ideas and the entrepreneurial spirit from all his people. This can happen only when the sense of passion, and romance of building a successful business, is shared by the entire organisation. Our corporate mantra at Reliance is, "We bet on people." We provide the vision, inspiration and resources to accomplish tasks, but we empower people, and we build new knowledge and new core competencies around people, fostering a spirit of teamwork and performance, across the entire organisation.
We believe that we can do with people, who do not have experience in a particular role, but we cannot do with people who do not have basic competence. Absence of experience can be made up through training and on-the-job performance, but lack of basic competence can never be made up. We encourage - indeed, expect-each one of our people to have a sense of ownership in whatever they are doing. As a result, Reliance is run by thousands of owner-managers. We strengthen our organization, every day, bringing in the brightest talent. We firmly believe, the smarter our people, the better our organisation will perform. So, we surround ourselves with high performing people ! We firmly believe - Do not be afraid to recruit people who are 10 times brighter, or more intelligent, than you. This leads me to another important attribute for success as an entrepreneur - the necessity of dealing with people, in every walk of life, at a very human level, building and nurturing relationships, preserving one's humility, and never losing family and social values. It may surprise many of you to learn that, despite all my travel and exposure, I remain a vegetarian and a teetotaler, and I am a God-fearing individual. I often say, that more than my academic education, my biggest education was at home, from my loving mother and father, where I developed an abiding commitment to our traditional value systems. What is important, is that these lasting value systems should be extended to the professional and business side of our lives. I have found, during the last 20 years of my working life that relationships, both, internal and external, built on the foundations of these value systems, have contributed immensely, to my success as an entrepreneur. I now move on to the "harder" attributes required, for success as an entrepreneur. I believe the greatest need is to guard against a sense of complacency - the usual organisational response to any major achievement. Dhirubhai used to put it in his own way - "Growth has no limit. You have to constantly reshape the boundaries of growth".
I believe successful entrepreneurship demands constant raising of the bar to achieve higher and higher levels of performance, encouraging people to stretch and sweat, to venture where few others would think of stepping out, to take calculated risks to achieve growth on an exponential scale, to never give up, to take every obstacle, or setback, or even outright failure, as a learning experience ! Successful entrepreneurship is a high-octane, high-energy business ! And it is this constant and infinite flow of energy that differentiates the most successful entrepreneurial organisations from the rest of the pack. Of course, successful entrepreneurship is not just based on brilliant and innovative ideas, powered by a constant flow of energy! What is ultimately required is hard action and results. Good entrepreneurs have the ability to execute - to effectively marshal resources to achieve end objectives - to ensure that there is no gap, between what the entrepreneur wants to achieve and the ability of the organisation to deliver it. Entrepreneurship also involves, taking what most people might consider to be big risks - cutting across accepted boundaries, going against the status quo, defying conventional wisdom !
But entrepreneurs approach risk in a different way - they evaluate risks and then take decisions based on their assessment of risk. Successful entrepreneurs always focus on goals, not on possible hurdles along the way - and that is why they are not paralysed into immobility, but keep moving ahead. All entrepreneurs are faced with adversity at some point of time. The secret is to convert every adversity into opportunity, and keep moving on. Successful entrepreneurs also learn to take doubts and criticisms in their stride. Consider critics to be your greatest friends - they show you where you can still improve. Successful entrepreneurs also learn to take doubts and criticisms in their stride. Consider critics to be your greatest friends - they show you where you can still improve. Successful entrepreneurs have all these qualities I spoke of. But there are some additional qualities required, especially in the Indian context, which are very significant in building sustainable businesses - and which, incidentally, not institute teaches. I am sure you have heard the popular joke about MBAs - that MBA stands for Mane Badhu Aavdache ? - people who claim to know everything, but actually know very little. To be successful, apart from all our academic knowledge, we have to develop an understanding of the business environment. We have a plethora of laws, rules and regulations, and a high level of government and bureaucratic intervention, that can kill the most ardent entrepreneurial spirit. Archaic and complex laws and procedures in India, often impede swift decision-making, impairing the ability to exploit new business opportunities. But, we have to succeed in this very environment. We have to understand the democratic and parliamentary system in India - how laws are made or altered, what parliamentary committees advise on legislation. We have to understand the legal and judicial system in the country. We have to understand the complex direct and indirect tax systems and procedures - customs, excise, sales tax, income tax - all major determinants of success, and profitability, of any business.
Of course, I am not suggesting that each one of you should become a tax expert, but a basic understanding of such matters is important, if you wish to succeed as an entrepreneur in India.
My dear young friends, to meet the challenges of the 21st century, India needs entrepreneurs with a global vision, who believe in change and transformation, who have the ability to take risks and chart out new growth paths. To guide you in this exciting journey of entrepreneurship, I would like to end my comments today, by sharing with you the guru-mantras for all entrepreneurs :
In conclusion, my dear young friends, I sincerely hope, that each one of you will derive inspiration from Dhirubhai's life and deeds - and accomplish his dream of making India an economic superpower. That will be a fitting tribute to him - and to the entrepreneurial spirit of which he will remain the undying icon. Let me once again, extend my warmest congratulations to all of you graduating today.
Thank you. Ladies and Gentlemen.
Dr. Kumar Mangalam Birla, Chairman, Aditya Birla Group And Chief Guest Of The 6th Convocation In The Year 2003-04 (Convocation Speech)
Mr. Damodaran, Members of the Governing Council, Faculty Members, Students, Ladies & Gentlemen:
Let me start by quoting the renowned Austrian economist, Joseph Schumpeter, who was among the original contributors to the study of entrepreneurs ? and their role in society.
I quote ?Entrepreneurs are pillars of strength, symbols of legitimacy, role models. They provide the new ideas and new blood?. They create ?new combinations out of resources and are therefore creative destroyers and destructive creators?. The distinctive element is that entrepreneurs ?act outside the pale of routine?. Unquote
But he also pointed out that (and again I quote): ?The more perfect our control of facts becomes; and the greater the extent? to which things can be quickly and reliably calculated, the more the significance of the entrepreneurial function decreases. Therefore the importance of the entrepreneurial type must diminish??.
Schumpeter?s two thoughts point in opposite directions. In effect, he was saying that: ?Entrepreneurship is dead. Long Live entrepreneurs!
Why the doubts about the future of entrepreneurship ? Because, as business corporations grew, it was widely expected that entrepreneurship would be on the wane ? and that the raw ?animal instincts? of the entrepreneur would increasingly be eclipsed by the logic and calculated rationality of large business corporations.
However, to the surprise of many, the currents of entrepreneurship have grown stronger ? even as the role of large business has become more ascendant. Fortunately for us, entrepreneurs refuse to play second fiddle. They keep exhibiting the mania to devise things others just have to have. They defy convention, and keep confounding the sceptics among us. The Davids of the business world keep surprising the Goliaths.
And in all this, a most encouraging aspect is that entrepreneurs are, once again, getting to be widely admired. They are becoming not just role models, but heroes also ? just as much as actors or sportsmen. Without doubt, entrepreneurs stand tall today.
The attitudinal shift ? towards those who distil creative and often wacky ideas into living enterprises ? has been pronounced the world over. It has hit with force in India too, where a new generation of entrepreneurs has been busy dreaming big, and taking on the world. We are all the richer for that.
So, I commend all of you who are graduating from the Entrepreneurship Development Institute ? the Class of 2004. You deserve our admiration for the conscious decision you made ? in the first place ? to be different, to be an entrepreneur. I congratulate you on the hard work you have put in over the course of your studies. I am confident that your motivation ? and competence ? will make you an entrepreneur in practice, in the real world that you are stepping out into. I also applaud the vision and dedication of those who have, over the years, made the Entrepreneurship Development Institute a pioneer in imparting a high standard of training in a very difficult and vital, but somewhat underemphasized craft of entrepreneurship.
OUTLINE OF TALK
I thought it would be appropriate to share with you today some of my thoughts and ideas about entrepreneurship, particularly against the backdrop of a world that marches to the tune of globalization. Specifically, I would like to touch upon two issues today:
ISSUE-I : GLOBALIZATION AND ENTREPRENEURSHIP
So, let me start with the first issue ? globalization and entrepreneurship.
I believe few today would suggest that the process of globalization can be ? or should be slowed or reversed. So, entrepreneurs have to live with the fact of globalization ? and shift gears ? by adapting their mindsets, strategies and game plans. The fact is that far from being a small business vs large business contest, both entrepreneurs and global firms are learning to co-exist, building up symbiotic, mutually beneficial relationships.
Let me pursue this thought. It is not that the large global corporations are not entrepreneurial. They also do what entrepreneurs do ? innovate aggressively, take risks and expand markets. In fact, globalization is itself a process of entrepreneurial discovery. Firms that succeed in the global market must be innovative and able to hold on to the profit opportunities their innovations open. And these attributes are much the same as those required of a successful entrepreneur.
However, it is my belief that large established firms, more often than not, turn out to be poor entrepreneurs. Why ? Because, barring the rare exceptions, radical innovation is not their forte. Their response time is often slowed by factors such as bureaucracy, hierarchy and risk-aversion. Radical innovators and large organisations do not go together for another reason ? the bulk of the payoff of the innovation goes to the organization, not to the innovator. And most important, some innovations are so radical that they threaten the very foundation of an organization. IBM, for instance, the dominant player in mainframe computers, had little incentive to be the first to introduce the PC ? as that would threaten its existing product line. It did so only as a last resort, when it saw that the PC was the shape of the future. So, the genetic makeup of large organisations is such that radical innovations are stalled.
At the same time, globalization also puts small businesses in a bind, because the base requirements for participation in global markets tend to converge towards the most demanding benchmarks ? in every function and process ? which can pose a severe financial and resource burden for smaller firms even in the developed economies, let alone India.
Add to that the fact that large businesses are under constant pressure to improve their competitiveness ? though better products, lower costs and reduced time to market. And very interestingly, the inherent constraints of the large firm ? combined with the limitations faced by entrepreneurs ? open a wide window of opportunities for entrepreneurs. As a result, the global firms and the small-and mid-size firms and entrepreneurs come together, by the large firms forming complex networks and entering into alliances. They also become central coordinators of networks, whilst small firms take on the supporting and non-core activities of larger firms. It creates a win-win situation.
In short, the point I wish to make is that the activities of large and small firms are increasingly complementary. Large, multinational firms are good at commercialising and internationalising innovations. Small firms are often better at creating innovations, especially the really radical ones. By working together, they add value to what each already has. The small firm may bring to the table a valuable innovation or idea, or a compelling cost advantage. The multinational has conduits to markets all over the world. The small firm can sell its product to the multinational and let that larger firm worry about having to deal with the nitty-gritty of the overseas operations.
What I cam driving at is that one of the key strategic actions for an entrepreneur today is to figure out how best his or her business can latch onto the value chain of the larger players ? whether they are global or domestic. For most entrepreneurial businesses, this may perhaps be one of the better starting points. Some entrepreneurs may certainly be in a position to go it alone right from the beginning ? if they have breakthrough technology, or some such decisive advantage. But, unfortunately, I do believe that this would be the exception.
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.
Third, entrepreneurship needs to take stronger roots where it is most needed ? at the village level, where the greatest income-generating opportunities exist. According to World Bank study, off-farm employment can play a vital role in catalysing income growth and promoting stability of rural incomes Rural households value such non-farm incomes highly, not only because they contribute significantly to overall income levels but also because they reduce their exposure to income fluctuations associated with bad harvests. Sadly, in India only about a third of rural households? income comes from non-farm sources, much of it from micro and small-size firms. The scope for non-farm income to increase is enormous.
Fourth, even the largest organisations in India need to experience ? and imbibe ? the refreshing breeze of entrepreneurship. Without that, they run the risk of becoming ossified. It has happened to the largest of companies the world over.
As the Head of Microsoft Research put it: ?Most large organizations have a mission, and invention often takes you in another direction?.
So, large organizations need to create a state of continuous tension and flux, and stay alert. The job of the leader is to keep the status quo, the established way of doing things, under constant challenge.
And that is the reason the entrepreneurial mindset is needed, even in the largest of organisations. But, as you may be aware, large organizations can be extremely hostile ground for entrepreneurs to bloom in. Because, while entrepreneurs make ample use of intuition ? the ?gut feel? ? this is an attribute formal organizations downplay. In most large companies, risks are tightly controlled, and out-of the-box ideas discounted.
The task cut out for large organizations like ours is to make space for new ideas and encourage a spirit of experimentation ? tone down the bias for analysis and certainty, with the bias for experimentation, and for trying things out. If it does not work, by all means, scrap it. But do give the champions of an idea the chance to try it out.
For e.g. some activities and projects - and some of the people who are inclined towards entrepreneurship ? may just need to be shifted outside the more formal work groupings, to looser work settings that provide greater autonomy / or the corporate reward systems may have to be modified so that occasional failure is not penalised. Creating an entrepreneurial culture may also require that normal recruitment criteria be dispensed with ? because, people with innovative ideas and impulses may not necessarily have the ?right? credentials. The trick is to do all this without throwing overboard what works. The discipline and the checks and balances imposed by formal structures are very necessary. But so is the need to retain the spirit of entrepreneurship.
Let me conclude by stating the obvious, but non-quantifiable secret of successful entrepreneurs ? the ability to unleash the imagination and to conceive an over-arching vision. The renowned physician and writer Lewis Thomas said : ?Discovery consists of seeing what everybody has seen and thinking what nobody has thought?. Peter Drucker, when asked how he predicted so well said, ?I never predict; I just look out of the window and see what?s visible but not yet seen.? Echoing the same thought, Einstein said that: ?imagination? was the key to his work ?. It was more important than knowledge.
I call upon all of you to dream big, and to let your imagination soar. The opportunities are there, waiting to be discovered. But as is true of the wilderness, not too many dare to tread the unexplored ground.
Padma Bhushan Shri Hari Shankar Singhania, President, Jk Organisation And Chief Guest Of The 7th Convocation In The Year 2004-05 (Covocation Speech)
?I am thankful to Shri V P Shetty, Dr Dinesh Awasthi and Members of the Governing Board for giving me this opportunity to be here today at this important occasion of the Convocation and meet the bright entrepreneurs of tomorrow.
EDI is a premier institution in the field of entrepreneurship training, education, research and has been rendering yeomen service to the cause for which it was set up in 1983. I am happy to note that EDI is the only institution in the country offering Post-Graduate Diploma in Business Entrepreneurship and Management with two specializations viz. New Enterprise Creation and Family Business Management. In addition it has a unique educational programme which offers PG Diploma in Management of NGOs. The sponsors of the Institute led by IDBI deserve special thanks for their farsightedness in establishing such an institute for promoting entrepreneurship.
I offer my heartiest congratulations to all of you, who have successfully completed the post-graduate diploma programmes. You are now poised to embark upon a new, challenging and, I am sure, highly rewarding phase of your life. My best wishes to each one of you, as you begin this exciting journey.
Entrepreneur is one who constantly analyses opportunities and takes initiatives and risks to seize them with courage and boldness. He has to have a vision, farsightedness as well as determination to forge ahead despite ups and downs. This is distinct from a more secure path of joining a service or employment. I would assume that more than the monetary or material benefits, it is the fulfilment of his creative urge that drives him to this path. In the process he is a job creator rather than a job seeker. He is a wealth generator not only for himself but for the society as a whole.
Entrepreneurs built nations and started the process of globalisation centuries ago. It was the entrepreneurs who travelled far and wide and created the silk route, spice route and other trade routes. They promoted international trading and investment activities. In fact they have been the backbone for bringing together different civilisations.
India has been a land of entrepreneurs for centuries. Entrepreneurship has pervaded all facets including agriculture, manufacturing, trade and services. So we in India are not new to it. Even in the days of Monarchies, entrepreneurship flourished. Under foreign rule as well, when the dice was loaded against us, Indian entrepreneurs made their mark.
There was no period in our history when everything was under state ownership. After independence for some period we did experience some curbs on individual initiatives and enterprises. However, even in this period entrepreneurship showed its mettle.
I am glad that we have now entered an era where an entrepreneur is free to do any business or set-up any industry he or she likes barring very few exceptions. The process of globalization has brought a new dimension of competitiveness and inflow of foreign investment. Our economic boundaries are no more national but indeed global.
Indian economy is among the fastest growing economies in the world with 7 to 8% growth per year and is poised to become one of the world leaders. In PPP terms we are the 4th largest economy in the world with a GDP of 3.5 trillion dollars. International studies project that India will become the 3rd largest economy in the next 30 years.
India is a young nation. 40% of our population is between the age of 20 and 45 years, 60% in the working age group. We have a middle class of 250 million. Compare this with the total population of 300 million in USA or 460 million in European Union. Every year 30 to 40 million people join the Indian middle class representing a huge consumption and spending potential.
What is most rewarding is that in addition to the proven entrepreneurs, budding new entrepreneurs have come up on the scene and are forging ahead. This class of entrepreneurs is increasing day by day. More and more young men and women are ready to take risks and become entrepreneurs. You are thus on the right track. You are indeed very fortunate to have been born in this unique period of Indian history.
I regard the future of India as very bright - full of challenges and opportunities. Every day I watch with awe the tremendous new opportunities that are emerging and are likely to come up in the time ahead. These not only lie in the expanding manufacturing sector but equally in domestic and foreign trade as also in a variety of services. They go beyond IT, Software and BPOs. The entire country is full of opportunities and growth potential covering the urban areas, smaller towns and rural areas.
Outsourcing is the buzz word of today. It is not restricted only to foreign firms utilising Indian capabilities but applies equally to Indian companies and various departments of government outsourcing from Indian manufacturers and service providers. One can be part of this growing network of value or supply chain. To remain competitive either globally or nationally, this strategy is imperative. If one analyses the opportunities for ancillary industries as well as a variety of services that will be generated, we find a big world waiting for entrepreneurs.
Almost daily I wish that I was younger to partake in this exciting journey. All I can say to you is that you are blessed. You have the opportunity as well as the responsibility to take India forward and bring to the millions of our countrymen a much better standard of living and quality of life.
I know that we have still quite a lot of difficulties and impediments like lack of roads, highways, power, housing, water, sanitation, healthcare, education and above all effective governance. But a true entrepreneur is never deterred by these. Rather he would have greater resolve to combat these difficulties and move ahead. The creative urge and determination to win would drive you, the young entrepreneurs to take on these challenges and enjoy the benefits of the unfolding opportunities. My father used to tell me that nobody gets a clean slate to write on and has to start with the dirty slate he gets. If one waits for an ideal situation, the time will never come.
My confidence emanates from my and my own family?s experience. Generations ago my forefathers moved from the deserts of Rajasthan and established themselves mostly in Uttar Pradesh. By early 20th century, they set up industries like edible oil mills, ginning factories, etc. In the 1921 my grandfather set up the first cotton textile mill in Northern India at Kanpur, whereupon the real industrial journey began. It was by no means easy because those were the days of freedom struggle. The nationalistic fervour was such.
This even led to a spate of nationalization. Foreign investment was also not encouraged. Despite this restrictive environment Indian entrepreneurs proved their resilience and progressed, albeit not at the pace they could have.
Many of our Group?s businesses like Insurance (National Insurance Company with branches all over India and spread in the Middle East and South East Asia), Banking, Aluminium, Coal, and Manganese were nationalised in the late 60s and early 70s. There have been number of setbacks and failures along with successes. Failures are part and parcel of entrepreneurship and one has to learn from them.
You must always remember that you need to build a strong value based character to succeed as an entrepreneur. Integrity, honesty and fairness are the basic tenets of this value system. You will be respected and trusted if you have them. There are occasions when one faces the dilemma of short-term gains versus taking a decision as per one?s value system. My own experience shows that whenever I faced such ?Dharma Sankat?, I could stick to my value system. The end result has always been positive. I strongly recommend you to give this the importance it deserves.
In view of the increasing competition ? national as well as global and complexity in the market place, entrepreneurs have to sharpen their management skills while managers have to imbibe entrepreneurship. Even in the big enterprises including Multi-National Companies, increasingly managers who are reaching the top are those with entrepreneurial talents.
Innovation is part of entrepreneurship. You need to innovate constantly, look at the problems from different angles whether it is in your business or in life. You must also cultivate flexibility and dexterity so as to be able to respond quickly to changing situations. This assumes even greater importance with the rapidity of change in all spheres and that too at an accelerating pace. The magnitude of change is often beyond our imagination. Uncertainty, ambiguity and contradictions are not exceptions but have almost become the rule.
When you analyse opportunities you have to take various facets and alternatives into account. You have to be realistic and not carried away by your emotions. You have to look not only to the present or the near future but must have a farsighted approach. If I may say so, you have to be cold blooded in taking your decisions. Above all you have to be quick and be decisive. Firm and specific action are keys to success. Often ideas and opportunities are lost without appropriate and timely action.
I have always followed the dictum that success comes only with ?10% inspiration and 90% perspiration?. There is no substitute for hard work. One must have a ?Focus? to achieve his/her Vision.
You must have a passion and I suggest that this should include passion to build a modern and prosperous India. The future lies in your hands. I take this opportunity to request the Financial Institutions and Banks to rise to the occasion and take an entrepreneurial approach to actively encourage and assist our entrepreneurs.
Before I conclude, once again my heartiest congratulations and very good wishes to the students and to the faculty of this Institute.?
Padmashri Ms. Lila Poonawalla, Chairperson, Delaval Industries Pvt. Ltd. And Chief Guest Of The 8th Convocation In The Year 2005-06 (Convocation Speech)
Respected President Mr. V. P. Shetty, Director Dr. Dinesh Awasthi, members of the governing council and other dignitaries on the dais, faculty members in audience, parents, ladies and gentlemen and of course our young students.
?It is indeed a special privilege and an honour to have been invited, by none other than President of EDI, Shri V. P. Shetty, to deliver the 8th Convocation Address at the prestigious Entrepreneurship Development Institute of India.
Let me begin by extending my wholehearted congratulations and my very best wishes to the young graduate entrepreneurs. You are going to enter a new exciting world. You will see a sea change in the economic, political, technological environment the world over and especially in India. There are extraordinary opportunities for those who are prepared to face the challenge of change. Indeed, only those of us will survive and succeed, who will be able to anticipate the change and also exploit the change. And those who do this will one-day lead the change. All of you should have the ambition of leading the change and make things happen on our own terms as far as India is concerned.
Ours is a country which has a hoary history and tradition of most outstanding achievements in the field of knowledge and that too centuries ago. India has a great heritage in ancient knowledge offered in condensed form in ancient languages like Sanskrit. This traditional knowledge reflects ancient Indian ethos in religion, philosophy, mathematics, science, art and culture in a variety of ways. This glorious tradition can be a strong source of inspiration for all Indians for internalising and strengthening commitment to implement the new knowledge initiative. Recognition and awareness of strength in our glorious past will dispel any inferiority complex and generate confidence and collective self-esteem to drive our nation forward.
What is needed is not merely a restructuring, a reconstruction, a reformation or review, but a ?revolution? to create new concepts for the future. To try to bring about change within the existing framework would be futile. A university or an Institute should not become merely ?learning? or ?teaching? medium, but a center where new ideas commensurate with the changing times, are generated. And I believe EDI is one such Institute. An Institute, which trains young minds to create a new brand for India. India as a land of Ideas and innovation.
I believe that for young people it is the ?psychic income? that matters much more. Your incentives are not just financial. The fun of creation, admiration received from your peers, the excitement and glory of taking part in the process of creation of something new and exciting, and especially one which can make a big difference to the nation, matters to you much more. And this is why you are motivated to become an entrepreneur.
Entrepreneur! Who is an entrepreneur? There is always a question. Is he/she born as an entrepreneur or can be trained to become one. My personal view is ? it is a little of both. He/she comes up with new ideas, develops creative response, takes full advantage of opportunities and is always pushing for change. You can recognize an entrepreneur when you meet one. He/she is focused on self development, demonstrates high level of energy and ingenuity and is an expert in engaging hearts of all who come in contact with him/her to rally around his innovative ideas. He/she is a visionary with many strategies in his pocket and an extrovert with 360-degree approach. Always a cheerleader cheering the team to succeed.
Entrepreneurs who sustain their momentum know the road to success is always under construction. Their hallmark is never ending desire to improve, along with an abiding interest in learning all they can. They are in a constant state of transition in which the journey itself is the goal. They thrive on challenges during periods of uncertainty. Theirs is a journey of discovery, the focus of which is to alter the perceptions and the view of what is already known. Their happiness comes from treading on unknown paths. They want freedom. Freedom is the lifeblood of entrepreneurs. Freedom to them means increased options of walking on new and challenging paths.
If you look at the footprints of a successful entrepreneur, you will find that successful people have steady footprints. Their footprints are consistent and rarely vary in space. Their footprints clearly indicate that they are precise and punctual; they set goals and are fearless. While the foot prints of unsuccessful or let me say less successful people are never steady. They go zig zag, start, stop, turn about, go in circles, even make 180 degree turnaround. Such individuals are never sure of what they want to do and vile away their life undecided and confused.
An entrepreneur should always play to win. When you play to win, you stretch yourself to your maximum and use all your potential. It also helps you to concentrate your energy on what you can influence instead of getting bogged down with the worry of what you cannot change. You have to walk that extra mile, if not for yourself, for those who are dependent on you. There is little choice.
To ensure that you do not get outdated, you have to keep renewing yourself. This prepares you to anticipate change and be ready for it when it comes. Constantly ask yourself what new skills and competencies will be needed. Begin working on them before they become necessary and you will have a natural advantage. The greatest benefit of your education lies not only in what you have learnt, but also in working how to learn. You have to constantly learn about people and how to interact effectively with then. In the world of tomorrow, only those individuals and organizations will succeed who have mastered the art of rapid and on-going learning.
You will want to upgrade yourself only if you respect yourself. The world will reward you on your successes. Success requires no explanation and failure permit none. But you need to respect yourself enough so that your self-confidence remains intact whether you succeed or fail. If you succeed 90 per cent of the time, you are doing fine. If you are succeeding all the time, you should ask yourself if you are taking enough risks. If you do not take enough risks, you may also be losing out on many opportunities. Think through but take the plunge. If some things go wrong, learn from them and move on.
Here I would like to take a pause and read out to you some important messages of a few successful entrepreneurs that you certainly have heard of and perhaps can relate to.
Mukesh Ambani ? Think big. Challenge conventional wisdom. Work towards long term objectives and aim for the best. Demand excellence. Do not fear change or the unknown. Work hard and never accept defeat.
Kumarmanglam Birla ? Vision and ebullience, perseverance, commitment, tenacity and a bias for action. You also need attitude and above all, passion.
Azim Premji ? Think big. Never compromise on fundamental values. Look ahead, be self-confident and have the best around you. Be committed to quality and play to win.
Narayan Murthy ? Speed and imagination. Global business skills. Also aspirations, patriotism, excellence in execution and communication skills.
Kiran Mazumdar ? Successful entrepreneurship has three essential components: a sense of purpose, the spirit of challenge, and a deep commitment to discover and be excited about discoveries. Every effort has to be that of a team. About sharing a vision with the team and getting them excited. But despite success, humility and integrity must never leave an entrepreneur.
I also would like to add my own message here rather than keep it for the end. Lila Poonawalla ? Think big. Challenge conventional wisdom. Work towards long term objectives and aim for the best. Demand excellence. Do not fear change or the unknown. Work hard and never accept defeat. Never compromise on fundamental values. Look ahead, be self confident and have the best around you. Be committed to quality and play to win. Have a Vision and ebullience, perseverance, tenacity and a bias for action. You also need attitude and above all, passion. Speed and imagination.
Let me take a detour from entrepreneurship to education and the importance of education in our life. In his Presidential speech, on the Eve of our Independence Day, two years back, Dr. A P J Abdul Kalam emphasized on education. The important role education plays in changing the Indian Mind. How education brings confidence and the will to win. Here is an extract from his speech ?Yesterday we celebrated our independence day. 57th birthday as a free nation. What is this freedom ? what have our young men and women to say? To them freedom means the liberty of making choices, of realizing their dreams, and belonging to a democratic, progressive and egalitarian society. India today is a country where every boy and girl can dream of playing with only a bat in their hands, equipped with determination and a will to succeed. Education gives you this.?
From my personal experience of assisting young Indian minds, minds from Pune I come across new surprises every day. By the way I have a Foundation of my own, called the Lila Poonawalla Foundation. Which I started 11 years ago and so far we have supported 362 young girls. The main objective of this Foundation is to support academically excellent girls (yes it is only for girls) but economically needy for their Post Graduation studies. We have found that these young minds are totally unprecedented. They are confident, have poise and education seems to bring to these young girls magnified knowledge.
?Entrepreneurship is behaviour rather than personality trait. It sees change as normal and healthy. It strives for doing something different rather than doing better what is already being done. A strong sense of innovation is a critical tool for entrepreneurs. Entrepreneurship is not only about creating a new venture, but also a new satisfaction and new consumer demand.? So said one of the most admired management guru Peter Drucker. I will attempt to illustrate what he meant by an example. Until 1860 only a few men shaved ? those who could afford a barber. Suddenly the trend changed, a clean shave was the look of the day. Visit to the barber was expensive and time consuming. This resulted in many entrepreneurs designing and manufacturing a multitude of do it yourself razors. The average price of the razor was $5. Now mind you the wages in those days was $1 a day. Thus very few men could afford this luxury. They continued to go to the barber whenever they could save some cash. Many manufacturers had to shut shop within a very short period. Than came on Horizon razors manufactured by Gillette. They priced the razors at retail price of 55c and gave it at 20c to the wholesaler. This was lower than 1/10 of the production. Now everyone could afford to buy the razor. This price was much below the cost of manufacture of the razor. But Gillette ensured that no other manufacturers blades could be used with their razors. The blades were priced @ 5c against production cost of only 1c. The rest is history ? selling a shave was never so successful.
Here I can also give you one more example of entrepreneurship. The story of Tetra Pak where I had the opportunity to work as their CMD. During world war two, a large quantity of supplies was required to be sent to the forces. Mr. Ruben Rausing, a citizen of Sweden was a young boy, like one of you. He used to watch a lot of breads being packed and sent to the soldiers, but there was a big problem of sending milk to them. He watched how the bread was being packed, and a brilliant idea struck him. Why not use similar package, seal it at two transverse edges, simultaneously filling the liquid and you have a pack, which could hole the liquid. The pack was like a tetra Hydrant and that is how Tetra Pak name came in to existence. Many innovations came after that, but the strategy he used was the same as gillet. Lit was not important at what price he sold the packaging machine and the processing line, what was important is how long he could ensure that the machines work. For as long as the machines worked they consumed paper, and the paper that could be used with the machines was only manufactured by Tetra Pak. Till date that strategy works. The profits come from the laminate and not from the machines.
I would now like to touch upon another important aspect of entrepreneurship. ? The role of entrepreneurship in relation to future India. But before I do that I would once again like to refresh our understanding of who is an entrepreneur.
One who controls his/her own future and changes the face of our world with a common belief in himself/herself that allows him/her to take the path to build a better place for himself/herself and the society. Entrepreneurs who sustain their momentum know that the road to success is always under construction. Entrepreneurs are in a constant state of transition in which the journey itself is the goal. They thrive on challenges during periods of uncertainty. Theirs is a journey of discovery the focus of which is to alter the perceptions and the view of what is known.
With these few definitions, to which we can add many more. I would like to come to the subject that I started to deliberate on that of entrepreneurship in relation to future India.
I am challenged by the basic questions.
Therefore where should we concentrate if we want India to have its rightful place among the developed nations of the world?
Successful entrepreneurship does not mean that you have to be an industrialist or have a small scale-manufacturing unit in town and cities, which are already bursting at the seams. Imagine the opportunities that lie if the 70% of India has only 10% more purchase power. Rural India really can provide a great challenge to entrepreneurship spirit. India can become the hub of agricultural produce for the world, in spite of feeding our own ever-growing population. This very population provides opportunities for those who have the vision.
Just imagine what are the opportunities existing in Rural India ? educational institutions, hospitals, communication centres, canals, irrigation, roads, engineering goods, consumer goods, retail outlets, research centres and on and on. What I mention is only the tip of the iceberg. With development of rural India the population can be evenly distributed all over the vast Indian subcontinent, provided entrepreneurship is also well distributed. Time is ripe and is on the right side of the young enthusiastic educated Indian population to make a glorious India of the future.
I have therefore a message for the budding entrepreneurs of today and also of tomorrow.
While I urge young entrepreneurs to focus on development of rural India, one certainly needs to have Global business skills. Also aspirations, patriotism, excellence in execution and communication skills.
All these qualities of entrepreneurship with clarity of thought and action and the right focus of where the future of India lies will make India one of the most envied countries of the world. You have to motivate yourself. Self-motivation is the best tool that you can have. Of all the communication you do, none is more important than how you talk to yourself. Your internal dialogue has more to do with your success in life than any other factor. I will give you a personal example. When I was a young engineer, I was put in charge of sales of one of the products of the company. This was my first experience in sales. A big target was given to me. I was of course nervous. Than I spoke to myself, as what should I be doing to achieve this target? Because if I failed it would be subscribed to the fact that I am a girl, and girl engineers cannot sell. This would be detrimental to the future of other girls who would want to take engineering as their vocation. Friends remember I am speaking of 4 decades ago, when it was unheard that women should be selling engineering products. Well I broke down my target into small monthly quantities. And I told myself; if I achieve my monthly quota I would celebrate. Those discussions with self made it possible. And celebrate every month I did. Maybe with a cup of tea or a wada pav with friends. But I told them that I had achieved my self-set goal and I am celebrating. You see I enjoyed the process of success more than the success itself.
Remember friends Five years from now you will be the same person you are today, except for the people you meet, the situations you encounter. The relations that you built, the joys that you pick up on the way and the thoughts that you have thought. Look unto yourself. The best place to find a helping hand is at the end of your own arm.
Let me conclude by reminding you about the Goldman and Sachs predictions for 2050. It is predicted that, along with China and USA, will be the three top economies of the world. Going further, I can confidently predict that if India plays its cards right, by 2050, it can become the number one innovation, entrepreneurial center of the world.
Finally, my friends let me assure you that it is a great time to be an Indian. Even more, it is a great time to be in India. Enjoy being a part of the action in this and of great past and even great future.
My favourite belief that has got me where I have is quoted below.
I was not looking for my dreams to interpret my life but rather for my life to interpret my dreams.
Thank you for having patiently listening to me, I wish all of you good luck and great life ahead.
Shri Shashi Ruia, Chairman, Essar Group and Chief Guest Of The 9th Convocation In The Year 2006-07 (Convocation Speech)
Good Evening Ladies and Gentlemen,
I find it exciting and energizing to be here among a group of students aspiring to be the tomorrow of the entrepreneurial world. This is a subject close to my heart and one that I have been doing my best to propagate to say the least. Nothing can be more satisfying and exhilarating than to see the success of an entrepreneur who has been mentored by you.
There has not been a better time in India to reach out and touch the horizon. The Indian economy is booming and there is a paradigm shift in the way things were being done even as late as the nineties to the way they are being done now ? whether it is manufacturing, service or if I may say the way business itself is being conducted. We have finally arrived on the global economic map and we will be among the top three economic powers within the next few years, if pundits are to be believed.
I am particularly happy to see a diverse mix of students here. This tells me that entrepreneurship is no more limited to Family Managed Businesses in India. The fact that there are students in the field of New Enterprise Creation, Agri-entrepreneurship and services besides family managed businesses indicates the diversity as well as the direction of our economy. What impresses me most is that almost 30% of you are from the NGO sector, and I am going to spend a little time later talking about this new class of entrepreneurs.
It is customary to start with the definition of an entrepreneur and his or her role in wealth creation and business enterprise. But, I am sure you have heard definitions and re-iterations in your classrooms all the time and I do not want to labour the point. May be I can learn something new from you!
Let me just say that when I was 12 years old, I used to go to Marina Beach in Chennai in the evenings and look into the sea. I think the first seed of entrepreneurship was sown there. I said to myself if I own a ship, may be I could touch the horizon.
I am not going to take you through the long journey that Essar has had but I think this class can benefit from the experiences of Ravi, my brother and I over the last 35 years.
The creation of Essar and we must go back to the late Sixties ? was born out of necessity. From a small beginning - constructing a break water for Chennai Port - we took the bold and unprecedented step of acquiring a ship to transport petroleum products ? a domain of international and Shipping Corporation of India vessels only.
Risky venture, literally in troubled waters ? but one with high rewards. The diversification into other businesses of steel, power, communication, oil & gas is a story well known and chronicled and I leave you to study the history of that growth.
I would like to underscore a few principles that we set for ourselves as we started our journey.
But we need a radical change in our education system which stresses the need for stability and conformity rather than risk and ?out-of-the-box? thinking. Industry and educational institutions need to work clearly to promote academies of innovation and excellence. Formal degrees should be supplemented and complemented by industry learning centers that award articates of practical competence.
Here, I would like to introduce another concept to you ? that of a serial entrepreneur.
When some success comes your way and every cocktail napkin becomes a sketch pad or that big idea gets you up at 3.00 am in the morning, the meaning of ?Attempting something ambitious? takes a new form. It has to be ambitious not by itself, but also relative to what you have already accomplished. It has to make you just that bit uncomfortable.
In that sense, with so many businesses and such a large asset base, we at Essar could be called serial entrepreneurs.
Today?s generation of entrepreneurs is in many ways fortunate. You have a liberalized environment, access to global technology and markets and a growing world economy. Of course that brings in cutting edge competitiveness and ?die-if-you-don?t-do? risks of a significant nature.
And you still have the same inhibitors that have come in the way of entrepreneurial enterprise if I may use the phrase.
Our archaic laws and the plethora of taxes do not augur well for the growth of the economy and our international competitiveness. So called single windows of clearance do not work well except in one or two states.
The irony is that we are a nation of natural entrepreneurs and many of us have made it really big in the West. Some have moved out of necessity but largely a lot of entrepreneurs have moved because of our complicated laws and education system. Despite a 400 year history of foreign invasion and colonial rule, we have demonstrated the ability to create enterprise by understanding and working within the system. Our children go to foreign shores for higher education and opportunity and their entrepreneurial spirit grab them. Some good examples are software, technology, medicine, education ? only recently have our youngsters realized the potential of being in India.
We also need to look closely at how families and organizations treat and manage entrepreneurial spirit in their people.
Most Indian business families are comfortable with continuing a ?running business? and handing it over to the next generation. The one exception that immediately comes to my mind is that of Ratan Tata who has made the Tata Group a globally recognized and respected business house.
Organizations are typically happy achieving an equilibrium which experts in organizational dynamics refer to as ?balanced feedback loop? where there is no force strong enough to break the system out of the equilibrium. Take the case of American entrepreneurs who have had a great record of starting and sustaining organizational growth through their entrepreneurial spirit and then letting them get into a stage where they lose their innovative streak and become laggards and ideal cases for acquisition. Read the list of Fortune 500 companies 25 years ago and now and you will see my point.
Therefore, I stress that both educational institutes and corporations have a significant role to play in the promotion of entrepreneurship.
I would like to devote a few minutes to what I would like to see as a unique set of personal characteristics that an entrepreneur needs.
Inspiration - to change organizational equilibrium. An example could be the case of eBay, the result of frustration by the girl friend of founder Pierre Omidyar.
Creativity - to approach the problem with an entirely new solution instead of optimizing the current system with minor fixes. Steve Jobs is a classic example when he developed Apple.
Direct Action ? The entrepreneur does not wait for someone to intervene and help, he takes direct action by creating a new product or service and the venture to take it forward.
Courage - Throughout the process, by facing the failure of risk and sharing the burden squarely.
Fortitude - to drive the creative solution to its end goal and market acceptance. FEDEX survived millions of dollars of losses and only a committed entrepreneur at the helm drove the company to continue till they reached positive cash flows and profitability. While we have not allowed the spirit of entrepreneurship to wane, we have always tried to keep with the boundaries of the legal framework and honoured all our commitments.
I must say that at the Essar Group, we have had very enriching experience of seeing how these attributes actually come into play. We have had our share of ups and downs, but we believe that our success is a result of an entrepreneurial spirit and positive attitude that flows through the entire organization.
I would now like to share my thoughts on how we see societal need creating a new breed of entrepreneurs ? what we could call social entrepreneurs.
Generally an entrepreneur expects to derive personal and financial gains for his efforts and profit is essential to sustain the venture.
The social entrepreneur and there are 25 of you here today ? has the need to create transformational benefit to a large section of the population. Of course we cannot change the entire world; we are committed to the 20,000 employees and their families and consider it our beholden responsibility to offer them a life that is not only adequately provided for, but comfortable and meaningful.
Mohammed Yunus, the founder of Grameen Bank and Nobel Prize Winner for Peace is a great example of social entrepreneurship. His approach to micro credit had created a worldwide micro credit industry.
Social entrepreneurship need to be differentiated from social service or Corporate Social Responsibility, both of which also seek transformational change. It is essentially in the outcome that an entrepreneur achieves. The example of Andrew Carnegie setting up a public library system in the US instead of just one library ? establishes his reputation as a social entrepreneur of excellent stature.
All the attributes that I touched upon earlier apply to the social entrepreneur and as you go forward in your ventures, I wish you all the best as your target is permanent benefit for your constituents and society at large.
In summation, what is it that makes and drives an entrepreneur? I think it is idea PLUS the knowledge that ?I am good at this thing?. But accompanying this simple, confident belief is the need and ability to withstand pain, discomfort, stress and anxiety. And moving out of comfort zones and occasionally doing something unfamiliar. Remember when you are comfortable you are not growing big.
I am reminded of a famous quote by Ted Turner ? the broadcasting entrepreneur who created CNN. He once said,
?My son is an entrepreneur. That?s what you are called when you don?t have a job?.
I am positive none of you is seeking a job and I wish you all the best as you move out of college and into the world of the ?New Entrepreneur?. I extend my heartiest congratulations to all of you who are graduating today.
Shri Venugopal Dhoot, Chairman & Managing Director, Videocon Industries and Chief Guest Of The 10th Convocation In The Year 2007-08 (Convocation Speech)
Shri Yogesh Agarwal, President, EDI
Members of the Governing Council
Ladies & Gentlemen:
I am thankful to Shri Yogesh Agarwal, President, Entrepreneurship Development Institute of India and members of its Governing Council, for having invited me to be the Chief Guest at the 10th Annual Convocation for the award of its unique Post-Graduate diplomas. I am truly delighted at this opportunity to speak to a cross-section of the budding entrepreneurs of tomorrow.
First, my best wishes to all you who plan to embark on your journey as entrepreneurs. Let me assure you that this is the best of times to strike out on your own. There is no dearth of business opportunities in today's world. Especially in India which is a land of vast business opportunities.
In the last 4-5 years, the Indian economy has been growing at an average rate of 8% plus. More importantly, Indian economic growth is more sustainable than that of most emerging economies, including China. This is because while most emerging economies are export-led, the Indian economy is driven to a large extent by domestic consumption that accounts for a significant proportion -- 64% -- of our GDP.
Moreover, the demographics are also in our favour. Currently, 54% of Indian population of a billion plus is under 25 years of age. This will ensure that India will continue to have a strong labour force as well as a large consumer base.
And, if I am asked where the prime business opportunity in today's context for budding entrepreneurs lay, I would unhesitatingly point to "Little India" -- by "Little India" I mean the over 600,000 towns and villages of India.
This said, I'd now like to share some of my thoughts on entrepreneurship.
Let me begin by addressing the question: Who is an entrepreneur? Rather, what are some of the traits of a successful entrepreneur?
Well, first and foremost, an entrepreneur is an "opportunist" in the best sense of the term. Let me explain.
Entrepreneurs are good at spotting and creating opportunities where none exist before. As they say, entrepreneurs see what everyone sees, but DO what no one else has done before!
Opportunities come with risks. There are no opportunities without attendant risks and vice versa. Opportunity and risk, so to say, are two sides of the same coin. What separates the entrepreneurs from the rest is their divergent attitudes -- while the former are excited by the opportunity element and focus their 100% on it, the latter are deterred by the risk element embedded in any opportunity.
Another important attribute you cannot fail to notice about a successful entrepreneur is his passion for the business. Not only is he good at his work, he enjoys his work immensely.
Also, since an entrepreneur does not work in a vacuum, his enthusiasm and passion for the business is infectious. It infects all those around him ? those who work with him and those who work for him. Which, in turn, contributes significantly to the success of his enterprise.
The real challenge of any enterprise lies basically in the journey from idea to execution. An entrepreneur is more like the conductor of an orchestra he leads, while his team delivers! So it's essential that your team buys into your ideas ? both in terms of the objectives and the means employed to achieve them, and has immense confidence in your leadership. A successful enterprise therefore calls for leadership of a tall order.
A successful entrepreneur is good at dealing with ambiguity and is generally quick at taking decisions -- even in uncertain conditions. He does not wait for all related data to be available to him to make up his mind, he relies for the most part on his gut feeling or intuition. For, he's only too aware that opportunity seldom comes visiting the second time and that business is fundamentally about deciding in real time with imperfect data. So he will not let the decision moment to pass waiting for perfect data.
Also, a true-blue entrepreneur is aware that he's not a know-all and therefore never shies away from seeking inputs -- no matter what the source -- for the success of his venture. Take it from me. A successful entrepreneur spends the better part of his time gently coaxing the best out of the people around him ? which precisely is the main function of a leader. As the legendary former CEO of General Motors Lee Iococca said, "Management is nothing more than motivating other people".
Coupled with the awareness that he is entering an uncharted area, a successful entrepreneur is never afraid to experiment and fail. He's not bothered by the fear of failure -- the fear that deters most would-be entrepreneurs from striking out on their own. Every 'failure' becomes, in fact, a great learning experience for him. And not -- as others would perceive it ? a loss of face. This, in my understanding, is the essence of the entrepreneurial mindset.
However, let me confess that there are few universal recipes for entrepreneurial success. In fact, when asked about the secrets of his success, the 20th century American oil billionaire Paul Getty said it all: "Strike oil".
Well, even so, I'd like to suggest a few lasting mantras that could prove helpful.
Dr. Vijay Mallya, Chairman, UB Group; Chief Guest of the 11th Convocation In The Year 2007-08 (Convocation Speech)
President of EDI, members of Faculty, Director of EDI, Graduating Students and Ladies and Gentlemen. I had the privilege of addressing the graduating class for a few minutes before this formal ceremony and I told them that and I don't mind repeating that, when Mr. Yogesh Agarwal so kindly asked me to be present as the Chief Guest today, I spontaneously said, "Yes, I will do it. Let me find the day in my diary." The major motivation was the word 'Entrepreneurship'.
I will share a bit of my own life, apart from sharing my vision and my perspectives, with you. We have come a long way in the last 27 years that I have been incharge of the UB group as its Chairman. In the early 80s being young and being incharge was not impressive. Being young and being incharge was a sure short ticket to failure. I recall now, of course very proudly, how I wronged my friends in the media who wrote me off. Wrote me off not because I was uneducated, wrote me off not because I was incapacitated, wrote me off not because I was handicapped?. they wrote me off because I was young and I lived young. My peers in the early 80s were Mr. Rama Prasad Goenka, Mr. JRD Tata, Mr. Aditya Birla? senior industry legends whose sons were not incharge of their businesses. I was unfortunate to lose my father at a young age and that's how I was put into the hot seat at a young age. And 25 years later, I love to have shown to the world that I proved them all wrong. Today, I have learnt a lot in the process, thought about it many a time- 'What is the future of this country?' I am absolutely delighted that I am seeing the future of this country right here- in front of me.
I have been in many situations all over the world, whether it's been this inevitable debate on India V/s. China, Growth rates, Development Potential etc? I have had enormous arguments with people who have written off India as a developing country, the country that has still miles to go. One day I asked somebody in England; why did you come to India? Why did you establish East India Company in India? Prior to your coming to India, why did Alexander, the Great, come to India? They didn't come to a poor country. They didn't come because India offered nothing. They all came to exploit the wealth of India. During
pre independence, India accounted for 22% world trade. That itself speaks volumes about the richness of India.
I have often said that our political masters since independence perhaps lost sight of a few critical priorities in terms of No.1 ? Education, No.2- Population Control, No. 3 ? Health Care; all of which has led to the fact that our population virtually exploded. Neither did health care, nor did education and nor did Industrial growth support this explosion in our population and, therefore, we have regrettably underprivileged people who live still in poverty. But, notwithstanding that, it is those who lead the future of India who will make sure that the nation as a whole prospers, both those who are privileged and those who are underprivileged. And, this is where the most important dimension of India comes in, that is, the very young demographic profile of India... the youngsters like you in our country. While arguing with various representatives of western nations, I do not talk about big industry, we are not talking about the Reliance of this world, The ESSAR of this world, the Air Tel of this world?we are talking about the spinal cord of India and the Indian Industry, which is the small scale sector, and this is driven purely on the principles of entrepreneurship. It is the small and medium enterprise that has continued to be the spinal cord of India's economic growth and development.
And, I only wish that more and more Institutes such as EDI get set up, get encouraged, in many parts of our country, because this is what we really need. Education is important; I would never ever argue that education is unimportant but to conclude that a master's degree or a Ph.D. is a necessary ticket to success; I would respectfully defer with that. Some of the world's largest companies, most advanced technological companies, innovative companies, such as; Microsoft, Apple have actually been started by college dropouts. But, what made them successful? The spirit of entrepreneurship. They didn't have a big degree behind them or big education behind them. I don't believe that God has been choosy or that God has differentiated in blessing all of us with intelligence. Then what is the difference between those whose I.Q.s are higher than those whose I.Q.s are lower. What is the difference between those who are successful and those who not so successful? I believe, it is how we use this God given intelligence. It is not lack of intelligence.
And how do you use this intelligence? As I said by being self confident. If you are self confident, you believe in your self. Believe in what you do and you will succeed. Failures are inevitable and are only stepping stones to success. But, self belief and self confidence are paramount. As you launch yourself to the outside world, march out with confidence. Don't be tentative; don't wonder what the world has in store for you. Think positively and act equally positively. I was delighted to hear from the Director that each one of you has done a project, which has been appraised by Financial Institution. This is absolutely remarkable. Never heard of this before. And I am glad, I am hearing about it today, which means that you have been able to think of conceiving and producing a bankable project at your age in life. That's why I say you are the future of India. This is remarkable.
Another thing that has completely swayed me today and has made a huge impression on me is that, here are youngsters like you, who are getting ready to take the country's future that of the underprivileged in their hands. Government will never ever have the amount of resources required to cater to the needs of the underprivileged or to address the issues of absolute poverty and other concerns of the country. NGOs must play their part in a very active way and make sure that India marches forward. I am completely amazed at the fact that there exists a course in Management of NGOs and there are people who have given up their careers to join this. One of the award winners today, I am told, is a Chartered Accountant, who could have got a job almost anywhere but he has dedicated himself to Social Service. This is the most remarkable thing that I have ever seen. And, I am glad that Mr. Agarwal didn't give me the whole history and geography of this absolutely wonderful Institute promoted by IDBI.
I am glad, I have come, I have seen, I have learnt myself. And this is probably one of the most moving experiences of my life and one of the most enjoyable events. I have been to the IIMs of this world; I have been to the IITs of this world. I love encouraging students and I love talking to youngsters. I love talking to youngsters because I feel absolutely passionately that the future belongs to the youngsters. I want to give them as much confidence because I can't help thinking about my own past, where every potential roadblock was put in front of me, because I was young. Today, I want to say the future belongs to the young and I love doing that, and I love talking about it. But, what I have seen today is much much much beyond being youngsters and being students. Entrepreneurship in my view will carry this country not just to the next century; but will carry India to the position of an economic super power. I firmly believe in this.
It is just that there has to be more and more opportunities. When we look around in daily life, we talk about GDP growth, we talk about this flourishing stock market, talk about so many other stories and inside every story, if you look closely, there is a spark of entrepreneurship. In all the success stories, this phenomenon is so very distinct. If you could take the story of India's largest company, the Reliance, you see, Dhirubhai Ambani built it on Entrepreneurship. Even today, everybody knows Dhirubhai Ambani did things in a way so unique; nobody had ever done it before and he created what we see today as phenomenal.
Look at what happened to our mobile phone industry today people like Sunil Mittal brought on a complete generational leapfrog from the point of having to wait for two years for a phone connection, which I am sure many of your parents here will remember, to being able to buy a mobile phone in 5 minutes flat. This is a generational shift in India's telecommunication technology and God bless those who brought it on. So opportunities are there, they are vast, in a country that is geographically diverse. And, another thing I must say that impressed me no end is that all of you are from different parts of India. As this is in Ahmedabad, anybody would have thought the majority to be Gujaratis. But, I see so many from different parts of India. What a beautiful fusion of Indian culture this is! Let me tell you, I have learnt a lot today. And, I have to thank Mr. Agarwal for having invited me here for this wonderful learning experience. God bless all of you.
Many Many Congratulations!!! The world is at your feet. Step out with confidence. And I wish you all the best and success.
Dr. K. C. Chakrabarty, Dy. Governor, Reserve Bank of India and Chief Guest Of The 12th Convocation In The Year 2010-11 (Convocation Speech)
Linking Entrepreneurship with Credit- The Role of Financial System
1. Shri R.M. Malla, President-EDI, Members of the Governing Council, Director Dr.Dinesh Awasthi, invited dignitaries, faculty members, passing out students and their parents, members of the print and electronic media, ladies and gentlemen. It is, indeed, a pleasure to be here amongst graduating students and I am thankful to Shri Malla and the EDI for this opportunity especially when it is an opportunity to return to my home state, Gujarat. A galaxy of speakers have addressed this forum in the past, this being the XII th convocation. I am aware of my limitations to speak on an occasion such as this as I am neither an industry leader nor an academic. Nevertheless, I shall try to come up to your expectations.
2. Convocations are always special. They are special because they are simultaneously a conclusion and a commencement. Convocations logically conclude a formal learning exercise. They are hence a time for relief, a sense of fulfilment and a feeling of joy to the graduating students and to the faculty. They are, however, even more special, because they commence a lifelong informal learning as graduates step out into the University of the World ? step out with dreams, hope and expectation into the terra incognita of life. In our days when we passed out, it was not a dream but a nightmare, because of the difficulty in getting employment. Now employment is available everywhere in the world. There are three types of employment. There are jobs with no work where one gets a salary without working. There are jobs where one can work for certain hours and get paid accordingly, and there are jobs where one can create and fulfil one's dreams, create employment for others, and that is self-employment or entrepreneurship. You belong to this class. It is a rare privilege to share this special day with the future businesses and social entrepreneurs of the country.
3. You pass out as alumni from a venerable institution. While the EDI commenced its capacity building initiatives in 1983, we must not forget that its genesis dates back to 1969. The late 1960s were a period when India undertook brave experiments to use credit as an instrument of development. In fact, entrepreneurship and credit are interrelated.The most important and perhaps the most significant amongst the public policy moves in this direction were the experiments to do away with guarantees and collateral and move from 'security based lending' to 'purpose based lending'. The entire development of entrepreneurship would not have been possible if this transition had not taken place.
4. The underlying thoughts in this policy intervention were that credit and finance were instruments of empowerment. By unfettering credit from security, those who were able and willing, creative and talented would not be constrained by lack of funds. The security for the funds lent would not be physical assets but the discounted value of cash flows that the enterprise would generate. This marked a decisive shift in methods of lending ? it reoriented lending from a static to a dynamic concept. Moreover, it was centred around people ? the living entrepreneur rather than on inanimate physical capital. My present organization, RBI , plays a very significant role in this change.
5. Such a policy shift was rooted not only in equality of opportunity which is enshrined in the Indian constitution and the need to provide employment, but, most importantly, it was rooted in the belief that it is talent and not necessarily capital that can make the difference; in the belief that resourcefulness and not merely resources matter. The key to India's development, thus, lay in unleashing the latent entrepreneurial potential of the country ? the critical aim was to free those with talent and ideas from capital constraints. We had various problems but we were unleashed in the 1990s after a wait of 30 years.
6. Entrepreneurship and finance alone are not sufficient. Conducive Conditions are needed for entrepreneurship to thrive. To create a nurturing ecosystem conducive to building business, a host of policy measures have been put in place by central and state governments, RBI, and other institutions. These include creating infrastructure - financial institutions to lend, institutions to assist with technical skills development, assistance with technological up-gradation, marketing, consulting, as well as capacity building in the form of entrepreneurship development programmes. I will be taking up some of these aspects which will be of help to you.
7. The purpose of capacity building was to draw out the latent talent and potential existing in society and provide the necessary guidance for it to flower when ideas meet with opportunity. It was hoped that entrepreneurship efforts would not only provide self-employment but the businesses would grow at a steady if not at a rapid pace. This would create further jobs opportunities, spur growth and mitigate migration.
8. One of the early capacity building initiatives was the 'Technician Scheme' launched in 1969 by two state-level agencies of Gujarat which envisaged 100% finance without collaterals. This initiative, over time, coalesced into the setting up of the Entrepreneurship Development Institute (EDI) of India at Ahmedabad in 1983 as a joint effort of the IDBI, ICICI, IFCI and SBI. The EDI has since been spearheading entrepreneurship development efforts in India and, as an apex body, has played a critical role in India's economic development.
9. Today, it is heartening to see that the EDI is incubating talent not only for budding entrepreneurs who with their risk taking abilities will change the economic landscape of the country, but also for those idealists with starry notions who wish to change the country and the world and make a difference to the existence of others through its course in NGO management.
10. While the strategic aims for stimulating entrepreneurship have changed over time, the core purpose of inducing dynamism in the economy remains constant. When the EDI was set up, it was hoped that entrepreneurship would stimulate India's economic growth and provide employment. The entrepreneurship initiatives of today are helping sustain India's growth trajectory. And, as I see you, the entrepreneurs of the Class of 2011, I trust that entrepreneurship of tomorrow will surely pitch India for a leadership position through innovations and ideas. The EDI, thus, has its hands full for the next two decades for generating a new quality of entrepreneurial capital. I will briefly dwell on a few questions.
Entrepreneurship: Does it matter?
11. First, does entrepreneurship matter? Schumpeter and much later Kirzner certainly thought it did. Indeed, economists often add entrepreneurship as the fourth factor of production to the traditional trinity of Land, Labour and Capital. They saw an entrepreneur as an innovator, risk taker and arbitrageur who introduced new technology, competition and created new markets. More recently 'entrepreneurial capital' is a term that is increasingly being employed.
12. Empirical evidence whether the level and rate of entrepreneurship are significant determinants of economic growth, productivity or employment, is mixed. However, the general consensus is that entrepreneurship matters not merely from its impact but also in the context of human development.
13. Entrepreneurship in India comes in four shades. First, is entrepreneurship for survival. Typically, this involves promoting poverty alleviation and self employment projects such as basic animal husbandry, petty business, etc. The finance vehicles for these are poverty alleviation schemes and, today, this form of entrepreneurship is the focus of micro-finance activities and banks in the rural areas.
14. Secondly, there is entrepreneurship that relies on internal business sense for local ventures. These typically consist of employees with practical / technical skills striking out on their own such as producing ancillary items. These largely involve proven technologies and cater to established markets.
15. Thirdly, there is 'add on' or 'lifestyle' entrepreneurship which consists of life-partners starting businesses on a part time basis such as tailoring, catering, pickle making, beauty parlours, day-care centres etc. These are driven by various motives - most start with the need to augment domestic resources especially during times of job losses of partners. Others do it for non-monetary benefits associated with being their own bosses and setting their own schedules. At times, some of these activities succeed to an extent that they become primary activities.
16. Finally, there is entrepreneurship driven by ideas and innovation. Typically, these are start ups that have a well-defined growth plan and exit strategy and rely for funding on venture capital or institutional finance. Typically, these involve new or relatively untried technologies and often untried promoters. These high risk ventures, when they succeed, create breakthroughs and have the potential to create substantial wealth. The success stories are legendary and too many to enumerate. It is in this realm of break-through technologies and innovation, where India has lagged for 500 years while the Industrial Revolution took place in the West, that the future of Indian entrepreneurship lies if India is to fully tap its greatest resource - its talent pool. It is here that you will contribute by bringing in new ideas and utilizing new technologies in the knowledge based activities.
17. To sum up, entrepreneurship matters for both growth and for development. It matters not merely for employment generation, the development of backward regions, mitigating economic concentration, and for spurring innovation, but also to enhance the capabilities of society and enhance people's freedoms and choices. Looking ahead, it is the area of entrepreneurial innovation, specially in the knowledge industry that has the potential to pitch India into an economic leadership role, which then can make a difference to our development trajectory.
Entrepreneurship and finance
18. What then is the role of finance? While the entrepreneur brings in ideas, techniques, innovations and passion which go to constitute entrepreneurial capital, it needs to be backed by command over a real resource. This is provided by finance. Finance, thus, enables entrepreneurship to become the fourth factor of production.
19. India has, in many ways, pioneered the concept of dovetailing credit into the country's development endeavours. The original purposes were poverty alleviation and employment generation. The policy interventions were premised on providing credit to draw out the entrepreneurial spirit. This, it was hoped, would enable large sections to lift themselves out of the vicious circle of poverty, create employment, spur growth, and contain rural to urban migration.
20. Policy measures include the concept of priority sector lending which, through affirmative action, helps channelize credit to small and medium industries; collateral free lending for loans up to Rs 10 lakh; guidelines for faster processing of loan applications by banks; allowing composite loans for working capital and term loans; specialised MSME branch in most districts; adoption of the cluster-centric approach; guidelines to expedite payments to MSME suppliers; collective forums to resolve issues relating to MSMEs including State Level Inter-Institutional Committees (SLIICs) amongst others.
21. Today institutions such as SIDBI, NABARD, EXIM Bank, Housing Finance Institutions (HFIs), and State Finance Corporations, the various commercial banks as well as venture capital providers and Micro Finance Institutions are a part of the financial infrastructure for providing finance to small entrepreneurs and to spur entrepreneurship.
22. These financial institutions have played a critical role in India's quest to draw out entrepreneurship. First, they have been instrumental in making available consultancy and advisory services to entrepreneurs at a reasonable cost by setting up a network of Technical Consultancy Organizations (TCOs). Second, they have helped spread the entrepreneurial culture across the country and to weaker sections of the society by providing financial assistance to first generation entrepreneurs. Third, their contribution to capacity building through entrepreneurship development programmes (EDPs) which are a precondition for lending to prospective entrepreneurs has been notable. Finally, they implement a host of government programmes such as the Prime Minister's Employment Generation Programme (PMEGP). These programmes not only provide incentives and subsidies but also impart technical skills, hand-holding support and assistance.
Creating conducive ecosystems: Role of Government
23. Entrepreneurship and finance are not ends in themselves. They require a favourable ecosystem and here is where you have the role of government. Complementing finance, entrepreneurship needs a conducive ecosystem to thrive. What is the support a budding entrepreneur can avail of? First, the central and state governments have created an extensive infrastructure at the central, state and district levels to create an enabling ecosystem for entrepreneurship. The infrastructure ranges from providing technical consulting facilities and advisory services to incubating projects.
24. Many of these infrastructure initiatives go back a long way when a host of institutions were set up. Some of these were the Small Industries Development Organisation (SIDO) (1954), the Small Industries Services Institutes now known as Micro, Small and Medium Enterprises Development Institutes (MSMEDIs), the District Industrial Centres (DICs), etc. These organisations, had their own problems, but are now in a phase of reinventing themselves. For instance, SIDO is now an agency for advocacy, hand holding and facilitation for the small industries sector providing a wide spectrum of services to the small industries sector.
25. Capacity building endeavours have been very considerable. These are organised not only by the national and state level institutions such as the national entrepreneurship institutes at Ahmedabad, Noida, Hyderabad and Guwahati and MSMEDIs but also by various Industrial Training and Vocational Training institutes through specialized courses supported by the Ministry of Medium, Small and Micro Enterprises (MSME).
26. Another facet of Government policy has been to create a culture of entrepreneurship. This has been attempted by including entrepreneurship into the education curriculum. Entrepreneurship Development Cells (EDC) has been set up across the country. This was followed by the Science & Technology Entrepreneurs Park (STEP) programme coordinated by the National Science and Technology Entrepreneurship Development Board (NSTEDB). The major objective of STEP is to forge linkages among academic and R&D institutions on one hand and the industry on the other.
27. A range of critical support services and needed facilities to nurture and support start-up entrepreneurs are provided by Technology Business Incubation (TBI) Mechanisms.
28. Finally, there are hand holding schemes such as the Rajiv Gandhi Udyami Mitra Yojana (RGUMY) which provide handholding support and assistance to the potential first generation entrepreneurs, who have completed EDP or Vocational Training programmes.
29. Can entrepreneurs be created? This question is cast in the mould of the nature vs. nurture debate. There are no answers. However, ingrained in the idea of EDCs, the STEP programme and Technology Business Incubation and MSME initiatives is the idea that by creating the right and conducive ecosystem and by education and capacity building, entrepreneurship talent latent in society can be drawn out, and, perhaps, this conducive ecosystem can also create new entrepreneurs.
Inclusive growth and social entrepreneurship
30. From the 1990s India's growth rate has accelerated from the Hindu rate of growth of 3.5%. India has had much to celebrate over the past two decades on the economic front. It has become one of the world's fastest growing economies. Indian companies have made their mark abroad and indeed many are transforming themselves into multinationals with a global presence. Most important, there is a new found sense of confidence. Confidence reposed by the world in us and confidence by us in ourselves. There certainly is the feeling of 'Yes, we can!'. To sustain this momentum, it is important that the growth that we have seen is inclusive, people centric and translates into overall development. It is important that this feeling and confidence permeates all sections of society and none are left out of the India growth story. Without this we will not be able to sustain high growth.
31. While the growth story has been impressive, there are causes for concern on other dimensions. Issues of income distribution are important. We have a long way to go in addressing concerns of absolute poverty. In the context of human development, the country ranks 119 among 169 countries on the 2010 Human Development Index published annually by the United Nations Development Programme. We compare poorly on almost all indicators such as life expectancy, education and per capita income. We have issues of water, sanitation, power, infrastructure and environmental degradation. More importantly, there are issues of social and economic inequalities and multiple deprivations. All budding entrepreneurs have to face these challenges and find solutions.
32. With these concerns in view, Government of India has adopted the strategy of inclusive growth in the ongoing Eleventh Five Year Plan. This entails triggering a series of development process that ensures broad-based improvement in the quality of life of the people, especially the poor, and the underprivileged. A number of schemes seek to address issues of livelihood and seek to act as social security nets. To make these schemes and policy interventions effective, it is important that the common person in general and beneficiaries in particular have access to the banking sector to receive and make payments on their own account. As inclusive growth is not possible without financial inclusion, 'financial inclusion' has become a major policy plank. RBI vision is that everyone in the country should have access to financial products and services but our immediate objective is that every village with a population exceeding 2000 (and subsequently all villages) should be covered either by a bank branch or through a business correspondent by 2012. The rationale behind this is that access to finance, along with fair and transparent products/services, is a source of empowerment and allows people to participate more effectively in the economic and social process. Our dream of inclusive growth will not be complete until we create millions of micro-entrepreneurs across the country.
33. In this context of inclusive development, the course in social entrepreneurship offered at the EDI assumes importance. While the term social entrepreneurship is new, the activity of building social capital is not. In the mid 19th century Raiffeisen innovated the credit unions and set in motion the cooperative movement; Vinobha Bhave led the Bhoodan Movement pooling and redistributing land; closer to the present, social capital built by pioneers such as Ela Bhatt of SEWA, Kurien's AMUL initiative or Mohammed Yunus's Gramin Bank have charted new directions and have led the way.
34. India, today, is home to the largest number of NGOs in the world. A recent government study estimates the number of NGOs at 3.3 million. This is many times more than the number of primary schools and primary health centres in India. While we have the comfort of numbers, we do not have the comfort of commensurate results. We trust that some in our midst, who are stepping out to pursue a career in the social sector and become agents of social change, will not only fill in this deficit but will also pioneer new areas.
Of Profits and Ideals
35. While much of social capital creation has been driven by idealism and the non profit sector, a view that is fast gaining ground is there is profit while serving the bottom of the pyramid ? and that creating access to essential services and products for under-served communities - rural or urban, below or above the poverty line, can be profitable. In fact we believe that commerce for the poor is more profitable than commerce for the rich. Our young entrepreneurs should not forget this cardinal rule.
36. While the idea is both innovative and has proved effective, we here tread a difficult area. Business entrepreneurship is easy to handle. Its immediate results are easily quantifiable in wealth created and jobs generated. Social entrepreneurship is more difficult. Their efficacy can be gauged by changes in society. Social change and the creation of social capital are certainly commendable activities. However, any advocacy for social change and the nature of social capital created is rooted in values and one has to exercise due care and caution in imposing the values of one society on another.
The Issue of Ethics
37. As you graduate from the EDI, what is it that you should hold fast to? First, is the issue of values and ethics. The cries for values and ethics in business stem from what is alluded to as the 'crisis of confidence'. These concerns have exacerbated in the wake of unexpected corporate failures and high profile collapses both abroad and in India. I will not spend time on the global meltdown which is well known.
38. What then are the qualities needed to make ethical decisions? First, is the ability to recognise ethical issues; second, the ability to reason through the ethical consequences of decisions; third, the ability to deal with ambiguity; fourth, the ability to distinguish between ends and means; fifth, the courage to go by conviction rather than consequences; sixth and most important, cultivating the integrity to face ethical dilemmas that you will face in the course of your career head on and to resolve them. Here, we should remember that, as in sport, what is important is not winning, but playing a fair game. Playing a fair game, may lead to failures and lost battles, but will surely win you the war in the arena of life.
39. Schumpeter referred to the entrepreneur as 'Mann der Tat' or a Man (person) of Action. The entrepreneur, he said, was someone who does not accept reality as it is. If there exists no demand for a good or service, the entrepreneur will create such a demand; s/he will make people want it. S/he acts decisively and does not feel the restrictions that block the actions of the other economic actors.
40. While you may strive to achieve the Schumpeterian ideal, I must caution that do whatever you have to do, bounded however, by ethical norms. These norms cannot be taught in a class room; these will be learnt in the crucible of life. Pursue substance and not form. Remember, it is not compliance to set norms that matters, but what you feel deep down in your heart is fair and right; seeking, in Wallerstein's words, 'the good, the true and the beautiful'.
41. And now for the customary homilies. As you leave the portals of this institution, we trust you will be persons of action, with hopes, aspirations and dreams. Dream on, but take care not make dreams your master. Enjoy what you do and do it with passion. Ensure that the excitement, passion and romance in building a new organisation and creating something new is shared by all in your team. Take those you work with, along with you. Deal with failure as a guide and with triumph with humility. And most important, cultivate a sensitivity to the rights and vulnerabilities of others.
42. Where you are concerned, the EDI and the faculty have done their job. It is now for you to go out and find yourselves. Lastly, three pieces of advice, which I give to primary students and postgraduates alike, which you should remember is, first, "be information literate", i.e. third generation literate. It is not enough to be a first generation literate, i.e. you know how to read and write, or to be second generation literate, i.e. to be computer literate, but to achieve information literacy. When transiting to a knowledge society and to be a successful entrepreneur, it is critical to be information literate. Second, you are passing out of EDI and have dreams. Many of you will be highly successful. But remember to "avoid complacency" during good times. Downturn may come any time. Third, life is not easy; it is difficult, whether of an individual or an institution. Bad times may come, and sometimes, all bad things will come together. In such times, do not become desperate. Do not lose hope, but pray, "wait and hope" because good times will return. I look forward to a challenging, prosperous, and enterprising career for all of you passing out today.
I wish you all the very best.
Dr. Sam Pitroda,Adviser to the Prime Minister, Public Information Infrastructure & Innovations and Chief Guest Of The 13th Convocation held on 3 April, 2012 (Convocation Speech)
13th Convocation of EDI Post Graduate Diploma Programme (Post Graduate Diploma in Management - Business Entrepreneurship (2010-2012)
Tuesday April 03, 2012
Convocation Address by
Dr. Sam Pitroda
Adviser to the Prime Minister, Public Information Infrastructure & Innovations
Dear Mr. Malla, Dr. Awasthi, my friend Dr. Alagh, Dignitaries on the dais, Members of the Governing Board, Faculty, Students, Members of Media, Families, Friends, Ladies & Gentlemen, Good Evening!!!
It is indeed a privilege for me to be here at the 13th EDI Convocation. I thank the organizers for this opportunity and I wish all the best to the graduating students. I liked your energy and I can feel it. I must tell you that I graduated just about 50 years ago. I got my first degree in 1962. It is good to be young and it is good to have such energy, enthusiasm and excitement. Go make something happen. You are lucky because you have been trained as an entrepreneur, which is a very special skill. You have been trained to create jobs. We, in India, need lots of jobs. We need to create 15 million new jobs every year. We have 550 million young below the age of 35.
Huge population, big work force for the world and they need to be trained, skilled and need to be given opportunities to build the future, for themselves, their families & for the country. I believe you will play an important role in creating new jobs in the country. I have had a very interesting journey. A little boy from Orissa, born in 1942, where there was no electricity, no water, no schools, no teacher, no pharmacy, no doctor. It is a journey of an ordinary man but certainly a very extraordinary journey. And, I want to share with you the entrepreneurial piece of that journey.
I still remember, reading in the newspaper in Baroda that President Kennedy had decided to send man on the moon. I was young, energetic and stupid. I decided that I have to go to the U.S to start a new life but I had no money. Somehow, however, went there in 1964, changed my degree from physics to electrical engineering because I had a girlfriend and it was going to take seven years to get a Ph.D. in physics. My priorities were very clear and I asked my professor as to what I could do to get a degree in one year? He said go and get a degree in electrical engineering. It took me nine months, got a degree, called my girlfriend to Chicago, got married and started life.
Worked for about ten years, for a company called GTE. It had lots of patents. In the meantime, my father who had 4th grade education, came to the U.S. and one day asked me "Son, what did you study?" I said, "Dad, I graduated in Physics". So, his next question was, "What is physics?" And, I realized that he had done a great job in not interfering with his son. I learnt a great lesson from him. Leave your children alone. Don't bother them, just love them, trust them. Then, one fine day he said to me, "You work very hard, you go to office at 8.00 a.m., you come at 6.00 p.m. why don't you quit?" I asked, "What do you mean?" He said, "Quit working for somebody, start your own business". Here was a man who had 4th grade education, he did not know what physics was and he was insisting that I must become an entrepreneur.
I paid a little bit of attention and then, finally one day, I quit. Everyone in the company was shocked. I decided to start a business of my own with two American friends. They had the money, I had the talent, we started a company called Wescom Switching in digital communication in 1974. By 1979 we had 2000 employees. We were doing 100 million then. It was lot of money in 1979 but then my partner started fighting. Everything works well in business till you are not doing well. Things fall apart and people start fighting when you do well. Camaraderie works when there is no cash, when there is cash priorities change. So, we had to sell the company. Sold it, made little bit of money. For an Indian who had never seen several million dollars then, this meant like unbelievable amount of wealth and I said, "That's the end of it; I am not going to work any more."
So, in 1979-80, I came to Delhi for the first time to visit and I tried to call my wife but couldn't make a phone call from Taj Mahal Hotel. I tried again and then little bit of arrogance and lots of ignorance said to me, "Go fix it." I went back home and told my wife, I have found another enterprise but this is a social enterprise. I want to go fix India's telephones. If I had known everything I know today, I would have never tried it. Ignorance is a great asset. Finally then got a meeting fixed with Mrs. Gandhi.
I met with Mrs. Gandhi, gave a presentation and my message was very clear. I told her, "I believe India can change the destiny by focusing on telecom software. We have young talent. All we need is political will". She agreed. That was the time when I met Rajiv Gandhi for the first time and then I spent about 11 years in India working on telecom technology, technology missions on literacy immunization, edible oil, dairy development, etc. I also had privilege to work with Dr. Yoginder K. Alagh. He and I used to go to Soviet Union together. I spent some time with Gorbachev. I had the best time of my life in those eleven years. Worked long hours, learnt a lot, never took salary but the romance of working in India for larger goods that were bigger than the money I had made in the U.S. was thrilling. In those days there were three of us who slept just 3-4 hours a day. Jayram Ramesh used to work with me. We were possessed with ideas and enthusiasm. And, then in a series of events-Finally I had a heart attack, went through a bypass, Rajiv Gandhi died and I ran out of money. All the money I had, I had already spent in India. All of a sudden I realised that I have two children ready to go to college in the U.S. and I had no money to pay for their tuition. I decided to go back to the U.S. but I didn't have visa to go back, because I had given up my U.S. Nationality. I took a tourist visa and went to the U.S. But, I couldn't work on a tourist visa. Started a business and then realized that I used to earn a patent on an electronic diary. I had filed that patent in 73, valid in 75 but had totally forgotten check about it. Every one in the U.S. was using electronic diary. So, I wrote to Toshiba, Casio, Sharp and Texas Instruments etc. I told them that they were using my patent, and, must, therefore, pay some royalty. Naturally they thought I had lost. I had got my patent in 1975 and was asking for royalty in 1991-92. They didn't pay much attention. So, one fine morning I decided to sue all of them in the cook county court. In 2 months they all came back, paid me several million royalty and I restarted my life. Then I built a business in Milvowke, started a company called MTI. I had a company called Ionix. But building business didn't interest me any more because the romance in India of building huge things was much more attractive. So, I decided to build a global bank out of London. I built a bank in London, lived in London for 7 years, put both my children through College. Then, once again the question was, "What do I do next?" I even had cancer in 2000. I decided to come back and work on National Knowledge Commission. Spent 4 years on it and now I work on Knowledge Networks, Public Information Infrastructure, Railway Modernization, Power Grids, Smart Grids, Innovations. All of these are huge assignments. All of these are great challenges, romantic projects, which could have far reaching implications on a country. But all the experience I had as an entrepreneur has played an important role. I have learnt to take risks. I work 24x7. In 47 years I have never taken a vacation. Because everyday is a great vacation. The joy of doing things is absolutely fantastic & when you do multiple things there is never a dull moment. If you are doing 50 things, five will definitely work, 10 will give you lot of pain, 10 will dissolve. You just keep pushing things. I also realized that the key to all these projects is, 'people management'. You get to learn to live people from your heart. You get to trust them, you get to build them, you get to work with them. People are your biggest asset, without people you can't do a thing. You also need to learn in business. Money coming in has to be more than money going out. Positive cash flow is happiness. Business models mean everything. First question that you ask in business, Who will pay?, Why will they pay?, How much will they pay?, Will they continue to pay? If the answers are all positive and clear, you get something. There are lots of great ideas. How do you take those ideas and convert into those viable businesses is the challenge. Risk is the key. My life has been a roller coaster. My highs have been very high and my lows have been very low. I had another by pass in 2005. But, life goes on, you get into trouble, you get it fixed, you move on next morning as if nothing has happened. It requires inner strength. These are some of the lessons related to hard work, business models, people management, financial management, risk taking abilities. These things don't come easy. I also learnt on the way, the discipline is the key. You have to have things to do. I have been keeping diary for the last 50 years. Everyday I note down things to do. All of the dumb things that we take for granted matter in business. I have learnt that honesty is the hallmark of good business. On one hand discipline, on the other hand ability to analyse, innovate, respect for ideas from others and ethics. I can tell you that in the last 45 years of my business life, I have never paid any body dime and I have never taken dime from anybody and I had a great journey. It can be done. Don't let anybody fool you into saying that I can't do business without bribing somebody. In India, corruption is a big issue. Everybody wants to talk about corruption. If you are firm, if you are clear, nobody will bother you. But, as an entrepreneur, if you want quick fixes, if you want shortcuts, if you are only after money, you will have enough opportunities to do wrong things. Business is not just about making money. Business is about making a contribution creating jobs, prosperity, not just for yourself, but, for your family, for your workers, for your community and for the nation. Unfortunately, everyone world over today is focused on US based model which is pushing consumption. More cars, more clothes, more roads, more energy, more money. General thinking is if you are smart, you have to be rich and if you are rich, people automatically assume you are smart. This model based on consumption is not steadable, sustainable or desirable in India. In India, we need models from the bottom of the pyramid which are affordable, which are accessible, scaleable and sustainable. When I entered in telecom, we had 2 million telephones in India. It used to take 10-15 years to get a telephone connection. Just in a short span of 20 years, the young talent in this country has been able to deliver to all of us 800 million telephone connections. We are a nation of a connected billion and now, we have new set of opportunities to do things differently.
Broadband will change the way we educate, the way we bank, the way we conduct new business, the way we provide health services. This is the opportunity to build new India and you all will play an important role in building new India. New India will be built with new technology, new talent and new opportunities.
Once a young business man was on the same flight as mine. I had a seat next to me empty so, he came and sat with me. He had a lot of interesting questions. He said, Sir, "I bribe everybody, I cheat, I don't pay tax, I don't treat my employees well, I harass my children, I fight with my wife, I always have stress, what should I do? We started talking. He expressed his wish to change and to make money by honest means. To his anxiety, I treated with a simple statement, "Why don't you then start doing so?"
I said why don't you start doing it? He replied, "How I can do, if everybody else is bribing." What I am trying to say is that we have created a system, where we cannot function the way we want to.
I feel, in India, everybody has fragile self-esteem. They all are ready to be hurt. If you don't say hello to me, and you say hello to someone, I feel bad. In India, 'Maan', 'Apmaan', 'Abhimaan' and 'Swamaan' are very important words for us. We don't have the Gandhian Self Esteem, which makes us strong, which makes us feel good about ourselves. All modern work requires team work. Remember, there is nothing that we can do without good teamwork & support of lots of people like; family and friends. The lesson to learn for me, from the conversation with the gentleman, was that there are lots of people in India with good intentions.
It is upto you, the young generation, to create new systems, new processes and stand up to old guards. And, only by being a change agent you will be able to bring about change. If you live into the old system, if you get something into the ways of doing things that we have today, India will not be able to grow at the rate it ought to grow. To continue to grow at 10%, we need new processes, new blood, and new mindset. I worry when our young mind up doing same things what their parents did. Young must rebel. Incremental change is not good enough. You must bring about generational change and generational change is difficult. You must rise and take on a fight which is to be taken on everywhere. Every sector in India needs a big fight whether it is political reforms, judiciary reforms, administrative reforms or business reforms.
Finally, I want to leave you with this thought that you are the agent of change, you must change. If you don't change, there are millions and millions who will pay price for it. You are fortunate enough to have the education, understanding and the tools to fight.
I wish you all the best and I hope that your journey also winds up being as interesting as mine.
Mr. Rajiv Takru, Secretary, Department of Financial Services, Ministry of Finance, Govt. of India. and Chief Guest Of The 14th Convocation held on 13 April, 2013 (Convocation Speech)
Distinguished members of the Board, Ladies and Gentlemen and my very dear students, Good evening to all of you!!! I am extremely happy to be here. I have realized in a hard way that Institute prepares you to be technically sound. It proves that all of you have reached a benchmark. But when you move out of this place, you will discover that it is entirely a new ball game outside. This is a closed environment; it is a safe environment. Life is not what it seems, everything is not rosy outside.
You will all discover that your technical skills have prepared you to be what you are today but there are certain other qualities which you must possess and which you must develop, if you have to succeed in the world outside. I am not going to talk to you about what you will do about the small scale sector in India, I am not going to talk to you about the direct benefit transfer, I am not going to talk to you about the spirit of entrepreneur inside all of you. All I am going to do is give you a little practical advice which will help you face the world.
I would like all of you to remember a few basic qualities which will make you better people. Remember, to succeed in life you will need far more than your technical skills. I want you to always remember certain basic qualities of human nature, which you must hold very near. I am sure that all of you have them. The first quality is integrity, the second quality is honesty, the third quality is loyalty and the fourth quality is to hold on to your basic goodness and your basic ethics which every human being has inside him or her.
At every step along the way, you will find that there are lot of incentives to take short cut.... a lot of incentive to cut corners. You can make a fast buck, you can fool the officers as they are already overloaded with work, you can bribe somebody. You can get something done. But believe me and this is something which has come from personal experience and the experience of the people I have seen around me, you will never skip easy.
I would like all of you for your own interest and the interest of your family to reach that stage in your mental development where you fall asleep, the minute your head hits the pillow. That can happen only when you have a conscience which is clear. Try to keep those values with you always. Be conscious to that which is wrong and stay away. You will notice in the long run that it pays. Remember, that only wise men learn from other people's experience. Try to copy the wise and the glorious. There is enough life experience around you which you can follow. I am telling you something based on my 34 years of exciting service.
One little mantra I have for you at the end. 'Be different, go out there, think differently, think out-of-the- box, allow your mind a free play. That is the only way you will make a difference. No one ever made a difference by following the beaten part which has been followed by generations before.' Many of you are passing out in family business management. But, family enterprise should not mean that you will go and join your father's or mother's business. Although your father and mother will tell you that this is the way we have done it from generations and this is the way you will have to do it, you do it differently. That is the only way you make a difference.
Perhaps you will fail but I would say- learn to ride. Even if you don't know how to ride, climb on to that horse. You will soon discover whether the horse is smarter or you are smarter. Be different, act different. That is the only way you are going to make a difference. This is a short mantra for success.
I have said these things from the bottom of my heart. You are all very dear to us. We have a sense of ownership over you. In your success, lies our happiness. I wish you all the very best in your life.
God bless you.
Shri G. M. Rao, Group Chairman, GMR Group and Chief Guest Of The 15th Convocation held on 19 April, 2014 (Convocation Speech)
I compliment EDI and its Governing Board for conducting these crucial programs. EDI has been spearheading entrepreneurship development movement throughout the nation with a belief that entrepreneurs need not necessarily be born but can be developed. Being an entrepreneur myself, I highly appreciate this noble task amidst a time when globalization and technology are transforming our economy. I feel so proud to be here today and wish I would have got such unique opportunity of learning entrepreneurship in my college time, maybe I was born much earlier.
Dear students, today is your day and a very special one indeed for you and your dear ones. I am truly happy to be with you to share your joy and excitement. As you cross this important milestone in your life and embark on the journey of entrepreneurship, I am sure all of you will contribute significantly in bringing economic prosperity to our beloved country.
India has been the land of entrepreneurs from ages; if you see our Vedic culture you will find the shades of entrepreneurship there by means of trading and all. From spice trade to sea craft, Indians excelled in all the components of business and consistently demonstrated innovation, much ahead of others. Tata's, Birla's, Mahindra's, Vedanta are numerous examples of entrepreneurship in the best. They are acquiring sick businesses and assets across the world and with their so called 'entrepreneurship' are turning them around into profitable companies.
The evolutionary process of Indian style of leadership is being studied as a success story in the leading business schools of the west. Entrepreneurship is the only way to alleviate poverty. And, I am so glad that EDI is creating beautiful entrepreneurs of tomorrow.
Well, people see me as a very successful entrepreneur; however they do not know that my last four decades of journey which started from zero base has been full of adversities which threw up challenges all the time. I strived hard to do my best overcoming the situations and turning them into opportunities. Learning's from those adversities have been phenomenal and has shaped me what I am today. In fact, this helped me build GMR Group what it is today.
I want to share with you my journey of last four decades. I started without any political support, any financial support in a very limited environment. I had a burning desire to do something. If you have Passion, Patience and Perseverance you can create success in your lives.
I was born and brought up in a remote village Rajam of Andhra Pradesh in Srikakulum backward district. At that time the population of the village was merely five thousand or so. My family had a very weak background of the lower middle class strata of the society as my father was a small time trader in the village; he used to trade in jute, pulses and oil seeds among many other items. Our business community was considered to be very timid in the society and often we were bullied and scared by the powerful people of the village. To overcome that general perception and stand against those people was itself very challenging in those days.
My family did not know the world; they were just into small time trading confined in a very limited atmosphere. Those days, my father's opinion about education was that it is enough if you know addition, subtraction, and multiplication to run the business.
However, I wanted to go for higher education so that I could become somebody; hence I pursued my father to pay the fee, which was fifty rupees at that time. He refused as he believed that education is not required for trading. I pursued hard through a local village doctor who was close friend of my father. He persuaded him to pay the 50 rupees fee.
My dear friends - that is the humble background I came from. Why, I am sharing all this is to let you know that I always had the burning desire to do something irrespective of the insignificant background; I had no financial support and no political support. It was that fire in me which kept me moving from one success to another. Hence, nothing is impossible, you can achieve whatever you want if you have the burning desire in you.
After completing my engineering I wanted to do something. My burning desire kept on constantly motivating me, instead of blaming the environment, parents and social situations, I developed a positive attitude.
I was in a big confusion whether to go for a job, to join family business or to do something else. By that time, my father divided the properties among all his sons and I got Rs. 3 lakhs and a truck. My father forced me for a job, and I started my work life with a shift engineer job in A.P. Paper Mill. But working in a paper mill and thereafter in PWD did not satisfy me.
I quit the job and came to Vizag where I tried doing some small business and getting a scooter agency. But with months of hard work and efforts, nothing comes through.
I was desperate. I came back to my village and joined as a partner with brothers in the family trading business. I was the only engineer in the village and people looked at me differently. I started understanding the fundamentals of the business, dealing with farmers, etc. It was not a big business, trading pulses, jute and oilseeds. People used to heckle me a lot that an engineer wants to do trading business. I had to overcome the challenges of the village mindset of the people.
That was the learning of fundamentals of business acumen. It was not easy for an engineer to sit down with farmers and small traders, negotiate and convince them for selling their products. In the process, I learnt a great deal of humility from them.
During the process of seeking opportunities, I got brewery license.... sugar factory license. I started another Jute Mill after acquiring it, started Ferro Alloys, Rolling Mills and what not. You name it I was there in that business...including trading of timber, IT company, ear buds manufacturing. That was a time when I started different businesses simultaneously.
I was able to operate so many businesses simultaneously because I used to go deep into details of the businesses, understand the nuts and bolts, formulate the operational strategy and quickly delegate to the management so that I can work on the bigger picture. I call this as 'Helicopter View' because of deep dive into details and quickly moving upwards on the surface for the big picture.
It sounds easy but believe me all these mills and businesses were very complex. But, I was able to successfully run these businesses because I used to simplify the complexities in order to make the right judgment. Also, I always think out of the box, some innovative solution, though I used to listen everyone and take everyone's opinion; however I try thinking independently altogether in a different way.
I tried almost 28 businesses and knowingly or unknowingly became the 'serial entrepreneur'. I call this as an opportunistic phase, where I was just grabbing whatever came my way.
We came across a huge opportunity of Chennai Power Plant requiring investment of Rs. 800 Cr. My team was initially very apprehensive of this, however I was very confident and fearlessly went ahead. Then we signed an agreement for 200 MW of Power Plant to set up in Chennai. I brought the world best technology in the Power Plant and with great difficulty successfully implemented it.
At this stage, my children after finishing their education joined the business and they said we should not do business like this. We had several businesses...28 businesses... spanning jute manufacturing, Ferro-chrome manufacturing, sugar and so many more.
The children were of the opinion that we should not be doing so many unrelated businesses and hence we brought in a consultant for advice. Consultant said we must have a strategy, should have vision and mission. If you ask me, I don't know the meaning of the words Vision and Mission at that time and thought I built the businesses and now they are teaching me such fancy words. However, children persisted saying that since we went into opportunistic mode earlier, we should now go into the strategic mode.
Moving into strategic mode, I divested all the unrelated businesses. Even my most profitable ventures at that time I divested. We were following our vision "we should build entrepreneurial organizations making a difference to the society through creation of value" and whatever was not fitting into it we divested. Because brewery was not creating a value to the society, we had to disinvest.
I call this 'emotional detachment' by managing the portfolio which is very important to scale up strategically. Entrepreneurs need to follow their vision and strategy without any emotional attachment.
In 1999, we participated in global bidding of the Greenfield Hyderabad Airport. The government proposed giving 5000 acres of land and said would give the bid whoever will ask the least grant but maintains standard in all 32 services of airport operations listed by the International body of airports.
The whole team went out and travelled world-wide, visited some of the best airports, discussed with some of the global experts and roped in best professionals available. That is how; we built the first Greenfield airport of the country which has been consistently ranked second best globally in its category. The key to our success was our willingness to learn and get into details. More important, our attitude of embracing the change, quickly adapt and implement made us successfully built this world class airport.
In 2005, came the opportunity for Delhi and Mumbai airports as both the airports came for privatization. We submitted our bid for Delhi and Mumbai airport privatization amidst stiff competition. It was a great challenging experience with heavy passenger and airline traffic which could not be interrupted as we went about constructing Domestic Departure Terminal ID and thereafter the giant Terminal 3, the world's 8th largest terminal, which we built in the record 37 months of time ahead of Common wealth games.
We faced many challenges but we had established strong and respectful relationship with all stakeholders. We had to interact with over 58 government departments on one side and on the other side we had to manage a peak of 40,000 workers and engineers from 19 nationalities. To add to it, we have to work with three thousand airports authority employees with a government mindset. It was a very challenging project but very satisfying too as we built the 'Gateway of India' which has been consistently ranked second globally in its category. When we took over the Delhi Airport, it was ranked 101 out of 126 and today it is being ranked fifth best out of 199 airports globally. This is how we adapted to the change quickly and executed the project successfully.
Also, whatever I do my thinking is that it should not only add economic value but should also contribute towards social value. I think that mindset has tremendously helped me in building the national assets which are contributing significantly for the social and economic growth of the country. For example, according to the economic research wing of government NCAER, Delhi Airport in 2009-10 has contributed more than 13.5% to Delhi State GDP and 0.45% to National GDP. Not only this, Delhi airport contributes 1.6 million direct and indirect jobs which is about 26% of the total Delhi's employment.
After the foray into Delhi Airport, we entered into creating power plants with gas assets, thermal, solar and recently hydro power plants.
GMR Group, true to its vision of 'Creating Value to the Society', ventured into businesses of nation building, it was the first mover - first for the Group, first for the industry, and first for the country. We unknowingly chartered into 'Blue Ocean' and enjoyed the uncontested market space.
But sustainable growth cannot be achieved without institution building; hence we are now focusing on four pillars of Institution Building - People, Process, Technology and Governance. Family governance is also part of our Institution Building process. Actually, Corporate Governance and Family Governance are inter-linked blocks completing the cycle of Institution Building.
Over a period of nearly 8 years, we developed a formal family constitution, which has been agreed to and is binding upon all members of the family. It covers areas like compensation, conflicts resolution, media policy, succession planning and so on. Very importantly, it is agreed upon not only by the family members working in the business, but their spouses as well.
I strongly believe in the philosophy "Run the business like a family and the family like a business". The idea is that our employees feel part of a family, which also develops their emotional bond with the Group. At the same time, we cannot take family members for granted, and must ensure their views and aspirations are taken care of just as we would do for our employees. Ultimately, this is what helps the business to prosper. Institution building is a continuous process and we are working towards it.
Only running the business has never been my thought process, I always believe that it is my duty to give back to the society in whatever way I could. 'Inclusive Growth' has always been my philosophy.
Since beginning, with 2-3% of profit every year being earmarked for social entrepreneurship, I set up GMR Varalakshmi Foundation, a not-for-profit, professionally run, independent company, present in 23 locations focused on education, healthcare, vocational training for jobless youth, and community development for the under-served.
Recently, I endowed the entire portion of my personal wealth to the Foundation, so that it does not suffer from lack of funds, even beyond my life time and should go on for perpetuity.
If I look back at my journey and think about what made me successful. I found out few important traits from beginning helped me:
Our seven values and beliefs which are Humility; Teamwork & Relationships; Respect for Individuals; Learning; Deliver the Promise; Entrepreneurship; and Social Responsibility.
The foundation of our seven values is Humility. Our humility helped us succeed in ventures, where we had no prior experience. Humility helped us gain the trust of our stakeholders, even in situations of high stress and anxiety. And, humility kept us open for learning, learning all the time from everyone and everything.
These 7 values have been the bedrock of our growth trajectory, despite various challenges. Other one is our 'Can-Do' Positive Attitude - Positive attitude is the foundation of courage and fearlessness which are so essential for achieving success in one's personal and professional life. Let me tell you a simple story to depict the same.
A poor man lives with his two sons in a one-room apartment. His wife had died many years back. Every night he comes home drunk and creates nuisance. The elder son quietly leaves, settles down under a street lamp and studies. The younger son also leaves and does not return the whole night. This becomes an everyday routine.
With the passage of time the two boys grow up.
One day, the elder son is given the 'best citizen of the town' award; on the same day his younger brother is caught stealing, and is put in prison.
Media asked the younger son "What made you like this?" He replies "My father was a drunkard, I had lost my mother at a very young age, no one was there to take care of me, and I lost my way. My father is responsible for my failure."
Same media asked the elder son "What made you successful?" He replies "The secret of my success is my father. He was an alcoholic and we were very poor. I decided that I should not be like my father so I studied hard to make a better life. I am ever grateful to my father for showing me not to be like him."
Now as you can see, the same situation viewed differently depending on your attitude. Let us not blame or make excuses. We always have a tendency, to blame others for our shortcomings. When we do that we make someone else responsible for our lives. The moral of the story is, we have to take responsibility for our lives. We must learn to use what life gives us, and not blame our families or our circumstances. Secondary influences may come from anywhere, but the primary influences are primarily our own attitudes. Attitude gives altitude.
Positive attitude coupled with the seven values helped me, in accomplishing whatever little I could till now, which I thought of sharing with you. Though, my journey is full of adversities but I sailed through it successfully learning from my failures. Always, remember that-
'Success is a great Motivator and Failure is a great Teacher'
My dear friends, in conclusion I would like to say that India is a perfect place for your entrepreneurial journey. Two decades back, westerners visiting India thought what they could do for this country. Now the attitude has changed. People visiting India are asking, what India can do for them. With great pride, I can say that no multinational company can afford to be absent from India because of its enormous intellectual manpower. Today, India has become the hub for Research & Development with more than 750 R&D centers established in India, employing over 400,000 professionals. Not only this, many Fortune 500 companies have already started their Centers of Excellence in India and many others are in the process of doing the same.
India is a young country with 50 per cent of its population being under 30 years of age. It is estimated that India will add around 11 million to the workforce every year for the next 5 years and will account for 25 per cent of the global workforce by 2020 which essentially means every one out of 4 people on this planet will be an Indian. These are indications of the demographic dividend the country enjoys, creating a consuming class and human capital to drive growth.
India has become the testing ground for budding entrepreneurs and we are experiencing increasing trend of innovation and creativity thus producing numerous successful entrepreneurs which is growing every passing day. Traditional entrepreneurial practices and systems are fast getting blurred by new knowledge and understanding, and in that sense you are fortunate to have been educated to pursue entrepreneurship from a guided perspective. I am extremely confident that you people will create enterprises bigger than Facebook and Google.
However, my dear friends remember that in this volatile, uncertain and complex environment, anxiety levels are going up rapidly. It is affecting work - life balance very badly. In order to sustain through such stress and strain of life, 'Work-Life Balance' is must. You read in the newspapers, successful executives dying of heart attack at a very young age. You hear about very talented corporate executives suffering from depression. You also hear about fast rising managers and CEOs addicted to alcohol. We are seeing many people chasing material success, but spending all their savings in medical expenses after the age of 40. This is a terrible tragedy in our society today. Success at the cost of the health is no success.
If you have to lead a sustainable growth, you have to manage yourself first. And to manage yourself physically and emotionally you need spirituality and yoga, which is irrespective of any religion. Universities today are doing excellent job in imparting education for learning to earn. But they are not able to teach life's complexities such as work life balance, how to live happily, and do self-management. Any small unpleasant incident happens in life, they crash. Unfortunately, circumstances are controlling their emotions and behavior.
Spirituality and Yoga help in coping with these challenges and provides a perfect harmony of body, mind and soul. It reduces stress and brings clarity of thoughts and greater focus in whatever you do.
My dear friends what truly matters, is how you evolve as successful human being. No matter what business you are engaged in, be it small time trading or a multi-national company, I strongly suggest that it should be purpose-driven and value-led journey. If your means are value-based, the end is always heartening. Always remember, all of you are the authors of your own destinies.
There is a beautiful saying that -
"Managers Preserve Wealth, Leaders Nurture Wealth and Entrepreneur Multiplies Wealth"
With this, I wish each one of you all the very best in your journey of entrepreneurship.
I am immensely Grateful to you all for giving me this opportunity to share my learnings and experiences with you.
Enjoy the evening!
Dr. Hasmukh Adhia, Secretary, Department of Financial Services, Ministry of Finance, Government of India - Chief Guest for the 16th Convocation of EDII's Post Graduate Programmes, held on May 2, 2015
Shri O P Kohli, Hon'ble Governorshri of Gujarat, Chief Guest for the 17th Convocation of EDII's Post Graduate Programmes, held on May 6, 2016
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