IndEcoSocial Framework

Copyright @SPJIMRInfluencing Practice & Promoting Value Based Growth

Asia Competitiveness Forum 2012 26-27 April ‘12 Delhi India

Competitiveness – Economic Development Prosperity and Creating Shared Value

IndEcoSocial Framework

Dr. Pallavi ModyDr. Anil Vaidya

S.P. Jain Institute of Management and Research (SPJIMR) Mumbai, India



The Changing World Economic Order


China and India Emerge as the Powerhouses of 21st Century

GDP Growth in India & China Size of the Economy India & China

Nominal GDP in US $ Billion

1990 2000 2010(Proj) 2020

India 300 500 1,600 4,000

China 400 1,000 6,000 12,000

GDP at PPP $ Billion 2010

India 4000

China 10,000

Source: IMF, Figures rounded

Source: IMF

2004 2005 2006 2007 2008 2009 2010 20110

2

4

6

8

10

12

14

8.1

9.19.6 9.4

6.46.8

9.99.5

10.1

11.3

12.7 13

9.69.2

10.4

7.4

India China


Businesses: The India Way

• Western Efficiency and Eastern Ethos

• Stakeholders vis-à-vis Shareholders

• Businesses and Socio-Economic Goals

• Businesses and Economic Development

• Prosperity and Shared Value


IndEcoSocial Framework

1. The businesses that started with more out of “Societal Concern”. Some Examples:

• Amul• Lijjat Papad• Fabindia

2. The IT industry and its impact on economic development through clusters and shared values creation through "IndEcoIT" model.


The Story of Amul The Co-operative Milk Procurement

• 3.1 million milk producer member families

• 9.4 million litres of milk procured per day

• Rs. 150 million ($ 2.99 million) disbursed

in cash daily

• 15,760 village societies

• 15 District Unions

The Co-operative Marketing

• 50 sales offices

• 5,000 wholesale dealers

• 7,00,000 retailers


The Story of Lijjat Papad

Co-operative Entrepreneurial initiatives of Female Empowerment

• 43,000 women

• 79 branches

• 27 divisions

• Turnover of Rs. 650 crore

• Exports Rs. 29 crores


The Story of Fabindia For Profit Business but with a Mission to Protect Traditional Art and Artisans

• 40,000 artisans consider Fabindia as their business partner and well-wisher

• Rs. 400 crore of turnover

• The artisans grew with the firm by learning techniques for greater value addition

• Fabindia has become a brand that cares

• Fabindia earns the highest net margin in the retails industry

• Valuation of Fabindia is soaring


Amazing Developments in India IT World


New Information Economy and

Global dynamics

Indian IT Firms

& their global delivery model

Indian Society

& economic Development

Government initiatives

Customers -Global and Domestic

The India IT The Players and Environment


Growth of IT-BPO sector

Social

Value

Creation

Year 2000 Year 2005 Year 2011

Indirect

Employment

9 million

56,000

employees

105,000

employees

2,500,000

employees

Economic

Value

Creation

Year 2000 Year 2011

1.1% of

GDP

6.4% of

GDP

Urban &

Rural

Development

.

Bangaluru,

Hyderabad

& 2nd , 3rd tier

cities


Shared Value Creation throughClustering & Corporate Communities

• IT industry in India evolved through phases– Low cost application development, BPO, IT services towards High Value Product Development, Engineering etc.

• Clustering and Interdependence has been mainstay of the industry

• In addition to economic value generation social value creation has been high on industry agenda – Direct involvement through sustainability efforts– Indirect contribution through government initiatives


E-GovernanceSocial value through transparency and efficiency

• Government of India and State Governments have launched various programs towards– Openness and transparency – Efficiency in government processes

• Government-citizen interface - examples– Land records, Income tax, Corporate affairs– Agricultural support to farmers on rain, soil, prices etc.– Medical help in rural areas through VSAT communication

• IT firms develop and implement government digitization & communication projects– In India as well as other countries


Social Entrepreneurs

Indian IT Firms

Social cause

Social value & Economic

Balance

Economic Performance

ThruClustering ,

Communities, Innovations &Shared value

creationDirect Social value

Indirect Social value

Synthesizing two models: IndEcoSocial Framework

Economic Developm

entIndEcoIT Model

of Indian IT companies

Social Entrepreneur Model


Thanks