Growth In A Slowdown

How do companies accelerate growth in a slowdown, and what are the lessons businesses can learn from this current crisis? Also, how far can technology help? BW invited business leaders to discuss these issues at a roundtable. The panelists included Arjun Malhotra, chairman and CEO, Headstrong; N. Parameswaran, principal advisor, TRAI; Saurabh Srivastava, chairman, CA India; Ashutosh Vaidya, senior vice-president and head, Wipro BPO Solutions; Anil Nair, MD, Avaya GlobalConnect; Mukesh Aghi, chairman and CEO, Steria India; Sukant Srivastava, vice-president and country manager, Convergys Corporation; and Arun Khanna, director, Shyam Telecom. The discussion was moderated by BW’s Deputy Editor Rajeev Dubey. Excerpts:

Anil Nair: The first thing you learn from the crisis is that you have to grow your business at a lower cost. So , you will have to innovate strategies. You need technology that is low cost and can meet high scale challenge. It has to be a marriage of cost and quality. Today, there is a polarisation of customers, and it is good for companies that believe in quality. On strengthening the market, companies and finances — if you have a strong market share and you do not have money, you are in a dilemma. Same is the case if you have no market share and a lot of money. For firms with a strong market presence and finances, this is the time to grow — to prove your market share, improve spending and reach where you have not reached before.

Arjun Malhotra: An economic turmoil gives a chance to do something different. Some of the biggest and best-known companies in the world were born during crises. So, look at the cards you have. Do not cry for other cards. Play with them. They are good enough. This is a good time to work on buying deals. Further, this is a great time to build loyalty. These times also help you identify your future leaders. Take this as an opportunity. And that will help you grow.

Arun Khanna: India has a large population. Hence, it is important to know the rural economy. It is offering opportunities. A recent study shows rural incomes are on the rise. The rural economy got a further boost with initiatives such as the farmer-loan waiver and the NREGS. Rural, small town economy has remained insulated from the impact of the slowdown. Keeping this in mind, my company developed low-cost, low-power equipment. As telecom equipment maker, I think the focus should be on technology for the masses.

Ashutosh Vaidya: Don’t just communicate, but over-communicate. When people are worried, rumours grow thick and fast — we are in the Facebook world. So, you must connect to the employees. This is the time I would look for the future. This is a great time to reach out to customers and connect to them. Build equations and look at common problems. Bad economy or good economy, you should be rotating people. You should be getting new blood in. Cut wastage and invest in the right things. I see it as a necessity for growth.

N. Parameswaran: This crisis will be offering real opportunities for those who are quick. Protection is not the solution. We must promote innovations and R&D in technology. Take South Korea’s broadband success story. It helped the country grow and tide over the currency crisis. Information and communication technologies (ICTs) are part of the solution to this crisis. ICTs can refuel the economy. The US recently announced $7.2 billion for broadband development, while Australia has set aside $4.8 billion; New Zealand $1.2 billion. India is also thinking that way. That will enhance growth.

Mukesh Aghi: The state of affairs reminds me of the allegory of the frog in a bucket. Here is a frog floating in the bucket. It cannot jump out, and says, “I can probably survive another eight hours. That is the choice I have.” The question is if you have to work harder or smarter. Our customers are going through the pain that we are through. So, it is important to get to our customers, and understand how do we ease their pain, how do we make them more comfortable, and how do we give more value to them in these tough times. It is always easier to firm up existing customers during tough times than to hunt for new ones.

Saurabh Srivastava: You cannot solve a problem unless you first recognise it. So accept there is a downturn. Relook at your plans, as things have changed. You must adjust and accompany. The key is to lead. Do not micro-manage. Also, communicate as best as you can. This is a great time to increase your market share. Think of maintaining or increasing your span, as there is less noise in the market now. Cost for advertising is not cheap, but not everybody is going for it. So, your ability to be more visible goes up dramatically now. Dropping prices is fine, but if you drop them dramatically, it hits customer credibility. Unleash creativity; get advertising and customers involved to create new products and solutions. Lastly, reshape, do not re-trench, your firm. You can build a great firm in bad times: Apple was built during a recession.

Sukant Srivastava: In a crisis, your existing relationships will give you more business. Establishing new relationships will be difficult. Get really close to your employees and take care of your talent. This is a good time to pick up great talent, and to protect existing ones. Another aspect is to anticipate bad news in this economy. You will have clients who go delinquent or bankrupt. You still service them, and hope they pay their bills. Make sure you have a good plan in place to conserve cash. This is a great time to groom the company, simplify the process and put money in the bank. Bad things will happen. This is also a great time to innovate with clients. They are more open to change than ever before. We must also understand the trends. This recession is only 50 per cent about the fundamentals, and the other 50 per cent is about the sentiments of the people. This understanding is vital for growth.