Business life cycle, like product life cycle, is getting
shorter with changes in attention span of the consumers. This actually means that a business
organization must not take itself grated to last several generations as it used
to be in the past. Average life of a
business organization in the twentieth century were around twenty five years
that has considerably been contracted due to factors like technological
obsolescence, decreasing attention span & higher consumption propensity and
proliferation of competition. The age of
Life time jobs & near immortal organizations have long been gone.
Indian businesses have to innovate to survive & succeed.
The scenario in emerging economies looks little deceptive as overwhelming
family ownership and government protection perpetuates the notion of continuous
successful presence of the family empires.
Look round and see in how many Indian business families two consecutive
generations have remained in the same business? As every generation seeks to
blaze its own new trail therefore it is imperative for the family to create
& nurture the innovation structure & process within.
Major Indian business houses have undergone transformation
in terms of their core sectors of activity. Besides new players continue to
challenge the established the existing ones. The telecom revolution in Indian
markets, that succeeded the information technology boom, saw the leadership
baton passed to new players despite the presence of the established giants in
those sectors. Similarly when the organized retail sector was opened in the
last decade for domestic players to enable them build competencies to take on
global players it did not yield expected results.
Majority of established domestic corporate giants could not
achieve major goals that they set out for themselves in the unfolding saga of
organized retail. Most have still not been able to discover a suitable model
fit for Indian consumer. The answer lies in intensive study of Indian consumer
profile & habits rather than force fitting the alien business models of
supple chain in India. Let us wait for the approval to multibrand FDI get nod
of the Indian parliament and watch how the competition plays out depending upon
the strategic stance of these existing organizations. There are several
indicators that point out that subsequent to multibrand FDI comes into force
most existing players would take an exit option or go for strategic joint
venture.
Family owned enterprises have to learn to allow innovation
to walk into their enterprises from the front door rather depend upon a small
carefully controlled window. Business Model Innovation should get a strategic
priority for companies to last an average lifetime. There is need for giving strategic priority to
BMI on the lines of product life cycle.
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