indian experience
Sep 21, 2009, 09:10 PM
[Reply]
Alan Rosling concedes that opening a business on April Fool's Day, in the midst of a deep recession, might have been tempting fate. Nevertheless, on April 1 he launched a firm that aims to help multinational companies develop business strategies for India -- even as the pace of foreign direct investment in India had shrunk by more than a third from last year's historic highs.
Mr. Rosling, 46 years old, is not one to shirk a challenge. Previously, as an executive director at Tata Group's holding company, he spearheaded the globalization drive at India's biggest conglomerate by revenue. Two decades ago, with an investment-banking background and a Harvard University M.B.A. under his belt, Mr. Rosling shunned offers from Wall Street and chose instead 'a very, very tough job' running a troubled textile business in his native U.K. He followed that up with a posting as special adviser to British Prime Minister John Major in the early 1990s.
Mr. Rosling explains the timing of his latest move: 'I had a five-year contract [at Tata] and it expired. I hope it proves to be good timing and that the first four or five months of 2009 turn out to have been the low point of the economic cycle, certainly in Asia.'
In his five years with Tata, which ended early this year, group revenue from investments made outside India soared from $2.5 billion in 2002-03 to $38.3 billion in 2007-08. The company hasn't released the total for the latest fiscal year, but the figure would include revenue from Tata's June 2008 purchase of Jaguar Land Rover from Ford Motor Co. for $2.3 billion.
For five years before that, Mr. Rosling was chairman of the Indian operations of Hong Kong conglomerate Jardine Matheson Holdings Ltd., which holds a minority stake in Tata Industries.
The premise of his new venture, Griffin Growth Partners Ltd., based in Bombay and Hong Kong, is that for all India's potential -- the government expects GDP growth of between 6.25% and 7.75% in the fiscal year ending next March despite the global slowdown -- its complex economy remains poorly understood. 'Few businesses from offshore have taken India as seriously as it deserves,' he says.
Mr. Rosling, whose career also included investment banking at S.G. Warburg & Co. in London, is a graduate of Cambridge and Harvard. Duncan Mavin sat down recently at Griffin Growth's new office in Hong Kong to discuss Mr. Rosling's perceptions about Indian business. The interview has been edited.
WSJ: Which overseas businesses in your opinion are handling India well?
Mr. Rosling: I think General Electric and [its former chairman and CEO] Jack Welch got it right quite early. GE have been persistent and, I think, dissatisfied with what they achieved. But that's always a good thing to be dissatisfied. Korean companies, both LG and Samsung, have done very well in India with a very localized strategy, while the top management might be Korean. Go to any bazaar in India and see what white goods [household appliances] and electronics they've got. It's not the Japanese. It's Korean brands that seem to be doing particularly well. Suzuki dominates the car industry.
But my argument is that they are not the norm.
WSJ: How much does success in India depend on being perceived as local?
Mr. Rosling: That used to be part of it. For instance, Hindustan Unilever [majority owned by the Anglo-Dutch company Unilever] is always viewed in India as an Indian company. It's quoted on the Indian stock market, it's managed by Indians. That's becoming less and less true.
A really good example is [construction equipment maker J.C. Bamford Excavators Ltd.] from the U.K., who have been in India for a while, first as a joint venture and now with a 100% operation; as I understand it, they are using India for engineering, for manufacturing components, and India is a big domestic market for them.
WSJ: One reason often cited for not investing in India is the complexity of Indian business and its culture. Is that a fair assessment?
Mr. Rosling: Think of something as important to India as Indian food. The chili originally came from Latin America, the flatbread from the Middle East. Kebab came from the Steppes. Even something as integral to India as spicy cooking: it's a masala [blended spices] of different origins all mixed together and made uniquely Indian. India is a complicated place. But it has always been part of a trading system and very open to the world and that's a great advantage when ideas and people and money and goods flow freely.
WSJ: How great are the cultural differences between businesspeople in India and the rest of Asia?
Mr. Rosling: If you take senior management teams from China and India, they're going to be very similar in the way they think. But there are cultural differences. When I was at Jardines, we had a joint venture in India, and one of my Singaporean colleagues used to be very uncomfortable coming to visit. My perception was he felt India was a difficult place and it was unclean and unhealthy. He would come for 24 hours, and he would not eat or drink for that period except what he brought in his suitcase. What that communicated to the joint-venture partner was not particularly positive. Equally, if you take Indians to China they also find it difficult. Sometimes I think it's easier being a gweilo [Hong Kong slang for a Western man] in both places, because you are obviously foreign, and people have no expectations of you.
WSJ: Have you made mistakes during your time in Asia?
Mr. Rosling: Yes, all the time. As young Westerners, particularly as M.B.A.s, we are taught to be self-confident, to be aggressive. Often in Asia it doesn't go down well for a foreigner to be young and pushy. I'm sure I've caused offense by trying to do things too fast, by trying to be too insistent, by not giving the respect to somebody who is senior.
WSJ: What advice would you give someone starting out in your field?
Mr. Rosling: I'm a great believer in taking a risk early in your career. When I came out of business school, I turned down the obvious job offers from Wall Street and the consulting companies and went and ran a textile-manufacturing business in the U.K. for three years. It was not a job I was well suited for. I'm not an engineer, I had never been in a factory before, but I found myself running four factories, and 1,700 people. It was tough, but I'm really pleased I did it. Because all the mistakes I made -- and I made countless -- are still valuable lessons to me now.
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