They’re focused on accelerating growth, and they’re after your lunch.
BOSTON — Warning to western business leaders: The Boston Consulting Group says there is a new breed of global entrepreneur from Asia on the loose, and they are after your business, both abroad and in your home territory.
The Boston-based consulting firm said entrepreneurs in China and India, including Tata, Lenovo, Huawei Technologies and the Godrej Group, have an “accelerator mindset” that places their focus on tenfold growth in 10 years.
This “ten-by-ten” strategy is marked by huge ambitions — a big-picture vision, colossal dreams and no limits on opportunities, said BCG in its report, The $10 Trillion Prize: Capturing the Newly Affluent in China and India.
“These entrepreneurs are unlike their Western counterparts,” said study coauthor Michael Silverstein. “They do not feel beholden to anyone, and are not bound by textbook business rules or the constraints of business logic. And they are natural risk-takers. They focus on execution, they’re not afraid of mistakes and they don’t aim for perfection. They believe instead that they can grow past their mistakes thanks to the rising tide of demand. All of these qualities make them highly unpredictable and therefore formidable competitors.”
In 2000, there were eight Chinese companies and one Indian company in the Fortune 400. By 2010 the Fortune 500 included 46 Chinese companies and eight Indian companies. BCG said several of these have grown to become challengers on the global stage, including:
• India’s Godrej Group, which has created new markets through innovative partnerships with Western appliance-makers to produce its tiny, efficient Chotukool refrigerator for rural Indian customers who have unreliable electricity and limited space.
• China’s telecom leader Huawei Technologies, where chairman Ren Zhingfei, an Army veteran applies Maoist principles to management, emphasizing a “rural-first” strategy, promoting self-criticism, combining theory and practice by rotating managers upwards and downwards, and applying dialectic to keep staff intensely optimistic and focused on the next crisis. BCG said he led an innovation effort that made the company the world’s largest patent applicant by 2009; it is now making inroads in Russia and Europe, and exploring the US market despite US security concerns.
Silverstein and his co-authors note several qualities distinguish Chinese and Indian entrepreneurs:
• they start with a clean slate, instead of following rulebooks or existing templates;
• they focus on a specific opportunity, identifying niches such as Godrej’s move to create a rural appliance market;
• they scale up or refocus as needed, reconfiguring staff and production on the fly to take advantage of fast-moving opportunities;
• they learn by doing, without investing significant time or resources in plans and studies; and
• they drive relentlessly forward, moving past mistakes in the conviction that future growth will take care of present challenges.
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