India’s Innovation Front Lines 2009 (Part 1): Of “Jugaar” and A Quick Recovery from Global Recession
Driving from Delhi to Jaipur on the Delhi-Jaipur highway, December 17, 2009—The new 10-lane Gurgaon highway, opened a year back, is already at capacity. The first 30 miles. through the industrial suburbs of Delhi, are stop-and-go traffic. The Maruti-Suzuki car factories and Hero-Honda motorcycle factories and their parasitic ecosystem for auto jug manufactures ring the highway. Commercial trucks, many of them dilapidated and overloaded and lumbering along at 15-20 mph, make up two-thirds of the vehicles on the road. There is a murky haze over the highway, and the industries we are passing by and the winter sun feel distant. The trucks have grizzled, unkempt drivers, many with a navigator/helper riding shotgun with his arm hanging out waving on overtaking vehicles, who blast their horns for added caution. Like in America, these trucks are the blood, and the roads the arteries, of the economy. Unlike America, but like many other things in India, they are inefficient, but supported by abundant, therefore low-cost, labor.
I am back in India after 10 months, ostensibly attending the TiE (The Indus Entrerepreneurs) charter member retreat and the annual TiECON India conference (dubbed the TiE Entrepreneurial Summit or TES), this time in Mumbai. The theme of the conference is Jugaar, a very Indian management concept, or lack thereof. Jugaar means to cobble together a solution to a problem quickly and with no planning. Markets around the world are changing more rapidly, driven by labor mobility, online commerce, and technology. Planned economies and business culture in places like Japan and Germany are at a disadvantage. India, perhaps, has an advantage with its Jugaar culture in supplying to fast-changing markets. Of course, in markets such as creating and maintaining physical infrastructure, Jugaar is a disaster, and that is evident in India.
This Jugaar management style that Indians, including Indian-American entrepreneurs, employ can be advantageous in fast-changing, or shall we say chaotic, environments. The dotcom era was just such a period, and Indian-American entrepreneurs, especially in Silicon Valley, thrived. A similar environment exists in India today, with rapid urbanization and a growing middle class that wants all the same products and services Americans are used to. India has bounced back from the recession in less than a year, with record car sales in November. Annualized GDP growth dipped to 6% at the depth of the recession, but is back to over 8%. Unlike China, this growth is driven by domestic consumption, not exports or government spending on infrastructure. Entrepreneurship is thriving in India. TES has 2,000 people registered. By comparison, TiECON in Silicon Valley, the largest gathering of entrepreneurs in the U.S., had 4.000 registrants in May 2009, and TiECON East in Boston had 800.
[Editor's note: As he did last December, Xconomist Vinit Nijhawan has returned to his native India touring and reporting on its innovation culture and community. This is his first travelogue post from December 2009. You can find a guide to last year's dispatches here.]