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TransformaciónBangaloreEstrategia DigitalNegocioTecnología

Leadership in the era of disruption

Sudhir Tiwari Sudhir Tiwari

Published: Mar 21, 2018

Imagine playing a game of rapid chess simultaneously with several players (a simul). If that’s not intimidating enough, imagine that the rules are in constant flux and new players can join the simul without any warning. This is similar to some of the experiences that business leaders go through today.

Not only do businesses have to compete with direct competitors, but they also have to fend off aggressive movers from the most unlikely of places. All while meeting the growing demands of stakeholders, shareholders, regulators, clients, employees, and consumers—effectively winning every match.

digital disruption

This turbulent marketplace is described as 'The Fourth Industrial Revolution', 'The Era of Technological Darwinism' and 'Digital Darwinism'. These all point to the same reality; technology is rewriting all of the rules. The World Economic Forum paints an intimidating picture of the Fourth Industrial Revolution saying, “In scale, scope, and complexity, the transformation will be unlike anything humankind has experienced before.”

However, the digital industrial revolution, digital disruption—call it what you wish—will not affect every business, industry, or marketplace in the same way. Professor Freek Vermulen of the prestigious London School of Business cautions: “Miss these nuances and your strategic decisions could lead you seriously astray.”

Each market is different, and it is important to recognize that. Here are three factors that we believe are unique to the Indian context.

Accelerated access to tech

A decade ago there would have been a lag between when a new technology emerged and when it became accessible to and widely adopted by India. For example, the television was invented in the United States in the 1920s. By 1947, still only a few thousand Americans—and even fewer Indians—owned a television set. Today, new technology will hit the market, be adopted, reach critical mass, and be rendered obsolete in a couple of years!

Technology is more than just an enabler of business ideas or back office processes; it allows for massive and rapid scalability and efficiency—when it is at the heart of a business. At ThoughtWorks, we describe this as Tech@Core.

This is exactly how Uber expanded globally, across more than 75 countries in just five years. And, here in India, mobile and data proliferation is the reason digital wallets are rapidly gaining momentum. The country’s mobile wallet market is expected to reach $6.6 billion by 2020. Another example is Bengaluru based health-tech company, Practo that has evolved into a one-stop destination for appointments, consultations, health records, insurance, and ordering medicines online. Practo is active in 38 Indian cities, and in Singapore, Indonesia, the Philippines, and Brazil. With over 1,00,000 doctors supporting the massive scale of operations, this digital offering currently caters to 25 million patients every year.

This rapid access to the best of what technology offers is thus increasing demand among Indian consumers for what’s new and next—and they want it now.

Meeting millennial expectations

We are at a unique point in history. More than 50% of the population in India is under the age of 25. They have grown up with technology and do not remember a time before the world was not at their fingertips, 24 hours a day. They have high expectations for meaningful work, experiences, and increased flexibility.  The creation of jobs and meeting millennials’ aspirations is one of the biggest challenges we face as a country.

History would suggest that industrialization and manufacturing will guarantee economic prosperity and job creation in India, but that time has definitely passed. Maturing (and low growth) populations of the west and the overcapacity in China will not create enough headroom for adequate job creation through industrialization. However, changing global demographics are also providing Indian businesses with a window of opportunity to become the service capital of the world. But this is possible only if the potential demographic dividend can be nurtured and supported in a meaningful way. Additionally, India will have four generations of people working together for the first time in history, which presents its own challenges in engaging and retaining the workforce.

India must also be prepared to meet increasing expectations for what constitutes excellent and seamless service. Millennials’ expectations are high and constantly changing (largely influenced by Silicon Valley).

When observing millennial Indians, there some certain interesting patterns to observe. Take the prevalent digitization that’s ensuring this generation is accustomed to having technological benefits across touchpoints—telecom, music, travel, retail, and books—and they expect the same innovation, speed, reliability, and access from every interaction with product and service providers.

Also of note is the changing buying trend within this group, that’s quickly shifting from ownership to access. A report by Goldman Sachs says we are fast moving towards a ‘sharing economy.’ A key and oft-quoted example is the use of Uber or Ola that allows for the convenience of a car without the ownership. A really interesting insight about the Indian millennials’ emotional well-being can be gathered from the 2017 Deloitte millennials survey. Indian millennials are convinced that they will be happier than their parents as opposed to their counterparts in Europe and Japan. This is a clear indication of the general optimism about the economic scenario in India.

Government intervention

The disruption of industries on such a massive scale is also forcing governments and regulatory bodies to rethink how businesses need to be supervised. Traditionally, businesses were able to create monopolies but now, new businesses, backed by venture capital, are changing regulations. This turn of events is opening up the Indian market to unprecedented opportunities. The open-market economy puts Indian businesses in direct competition with global businesses that are armed with war chests of money.

The launch of India Stack, while unparalleled in India, is reminiscent of similar investments made in the U.S. that gave rise to technologies like GPS. This, backed by the push to open Jan Dhan accounts, the growing mobile access across India, and the JAM trinity, has set the stage for both, market access and enabling previously unbanked Indians to be part of the formal economy. This promises to open the markets to millions of Indians and opportunities for businesses. Additionally, with the recent rollout of GST, a single India-wide market is now a reality.

Are businesses in India doing enough to ride the wave of technology-led disruption? While one could have argued that India missed leveraging the ‘industrialize and export model,’ citing lack of physical infrastructure as a key reason, that’s not the case today with the easy access to necessary infrastructure and building blocks for technology.

Then, the second question is whether there exists a lack of imagination, innovation, and efforts to leverage the latest available business technologies in India? And that is a problem that will leave a number of businesses in India vulnerable to disruption. An example is Amazon’s recent forays into offline businesses with the 5% stake in Shoppers Stop and buying Whole Foods — a clear indicator of what businesses should expect from Tech@Core companies in the near future.  

Business disruption is not new (what with Keynes coining the term, Technological Unemployment back in the 1930s). But the pace and impact of disruption are unprecedented. We are truly in a new world of impermanence, and this calls for a radically different style of leadership.

This first appeared in ET CIO.
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