Over the barrel: What must Indian business leaders do

A few weeks ago the Prime Minister visited private companies involved with the formulation of Covid-19 vaccine. And as I write, farmers of Punjab (and other states) are massed on the borders of Delhi in protest against the three agricultural Acts passed last year. One of their concerns is the Acts will leave them vulnerable to the negotiating heft of large corporates. To dramatise their concern, they have called for boycott of Reliance Jio in Punjab. Some miscreant sympathisers have even vandalised Jio phone towers.

These two incidents have helped me frame the contents of this article. I will admit I have struggled somewhat. I did not want my first article of 2021—after a year when ‘everything changed’—to be one more piece on the consequential economic and social implications of the pandemic. That would have been one too many. Fortunately, the above incidents provided the prompts and I decided to draw on them (and my Zoom meetings) to address the narrow question. What lessons must Indian business learn from the pandemic to operate successfully in a post-Covid-19 world?

The PM’s visit was one more reminder of the criticality of the importance of public-private partnerships. I was not, of course, privy to the conversations that took place, but I would like to believe the PM signalled the government’s receptivity to external expert advice and CEOs reaffirmed their commitment to partnering the State to help address not just this medical crisis, but also the many other social and humanitarian problems that afflict the country.

I cull two hopes from this visit. One, the government has appreciated that they do not have the expertise to tackle the complexity of the problems on their agenda; that the model for sustainable development in a post-Covid-19 world must be a collaborative one and that in this model, businesses can contribute along the axes of science, management and technology. Two, businesses will repurpose their goals and look beyond profits. They will recognise that they cannot succeed if society fails. And that to prevent the latter they will come out of their narrow silos and actively engage in the post-pandemic developmental model.
Covid-19 was not the first, nor will it be the last, crisis of global dimensions. The threat of global warming, for instance, hangs over all our heads like the Sword of Damocles. Its impact is less immediate and for the present at least, less palpable. But it looms and its consequences are existential. So, if there is one straw that Covid-19 has offered, it is the tangible evidence that no one entity or group—the State, markets, businesses, entrepreneurs, scientists—can tackle existing and emergent economic and social problems on their own. They have to work together to resolve them.

Reports of the boycott of Reliance Jio brought home one further hard Covid-19 truth. In our connected world, no one is shielded from the Butterfly Effect. The flap of a butterfly wing in one part of the world (a virus particle in the Wuhan province of China; three Acts of Parliament) can cause a hurricane in another part thousands of miles away (a global knockout; vandalism of Jio phone towers).

I have been on many Zoom calls with CEOs over the past several months. The conversations have varied, but the common thread running through each conversation has been the uncertainty of operating in the post-Covid-19 digital world. Every business leader has, in some form or other, expressed a trifecta of uncertainties. Is their business facing a hinge moment—a radical discontinuity necessitating the reimagining and reengineering of their strategy and product portfolio? Or are they witnessing no more than another turn (albeit, steep) of the business cycle and that, once the vaccine has been developed and distributed, the market will return to business-as-usual? Or will conditions necessitate a middle-of-the-road approach—stay the pre-Covid-19 course but, at the same time, speed up the pivot towards a new business model?

Most business leaders are adopting this third hybrid path. They are probably right in doing so. They accept that their businesses have been impacted, but not to the extent that they should give up on their knitting. Certainly, CEOs of the industry that I know best have logic to argue that the world cannot yet dispense with oil and gas, but that it would be strategically imprudent to put all their eggs in the hydrocarbon basket. Substantially greater resources must now be allocated towards solar, wind and clean energy.

The lesson that I draw from these conversations is the importance of the quality of leadership. Fareed Zakaria has, in his excellent book ‘Ten Lessons for a Post-Pandemic World’, listed lesson 2 as follows: “What matters is not the quantity of Governments but the quality.” He has contrasted the disastrous management of the pandemic by US and UK governments with the successes of smaller countries like South Korea, Taiwan and Singapore. To make my point, I would substitute the word ‘government’ with ‘leadership’. The key to corporate success in a digital world buffeted by the Butterfly Effect will be the capability of leaders to think out-of-the-box and to handle the unexpected. Financial, technological and human resources will be necessary, but they will not be sufficient.

In this latter context, lesson 5 from Zakaria’s book “Life is digital” holds out another learning set for our business leaders. He writes that Covid-19 has “obliterated the one remaining obstacle to a digital future—human attitudes.” He says that the tools for such a future existed pre-Covid-19, but people did not use them. They were “stuck in their old ways.” Covid-19 forced them to adopt and adapt. The challenge for our business leaders will be to navigate a pathway that sustains the benefits of these tools, but without deepening the existing social and economic inequalities. Life is not digital for millions in our country.

The author is chairman, Centre for Social and Economic Progress