Sunday, July 18, 2010

Final Blog Post

I got back from India almost one week ago and it's time to reflect on the experiences and impressions I got from the trip.

First of all I have to say I was very glad to find myself very well prepared by the pre-departure meetings we had prior to the trip. We arrived in Delhi after an exhausting 2 day trip and hit the ground running. I was ready for complete madness but was surprised that is wasn't as chaotic and confusing as I anticipated it to be.

The first company we visited was the Indian HQ of Yum! Restaurants International. This very first visit was exemplary for all other visits to come. We were greeted with such a friendly and warm welcome that made me almost uncomfortable. Coming from Germany, a country with very formal rules on how to behave in a business setting, it was almost like visiting friends than company execs. This is one common theme I experienced throughout the trip, Indians seem to be way more comfortable with each other than it is the case in my home country. This is visble in everyday interactions, as for example two police officers walking down the streets holding hands.

This openness and warmth is also visible in the business world. While Westerners focus very heavily on data and facts and emphasize "cut to the chase", Indians seem to enjoy talking about family and other personal issues. Once a trusting relationship has been established the details of a deal can be worked out. A handshake is a word of honor and can be relied on. I find this to be very pleasant and this is definitely a main takeaway to be more conscious of personal relationships than only hard facts.

Another aspect I really liked about India was the ingenuity to come up with solutions. Indian companies have a talent to satisfy customer needs ... always ... somehow. Sometimes it seems to be highly unlikely that a specific problem or request will be solved/fulfilled in time but in some miraculous ways they make it happen. It's almost like a bee hive, completely unorganized if looked at from the outside but somehow the proclaimed goals are accomplished. I think it's a level of creativity that has been lost or is stifled in the stiff corporate culture in the western world. As a future manager I will try to incorporate this in my decision making and managing style, to allow for improvisation and creativity.

Of course it wasn't all great. One problem that especially struck me is the omnipresent issue of corruption. We were talking to business leaders and they openly said how they need to bribe government officials to get permits they need or speed up various processes. I believe it's poisonous for a country to not have a functioning administration or better speaking an administration that relies on bribes to get anything done.
Also I found it to be frightening that the average citizen does not see authorities like the police as a force for protection but something to be afraid of. One gentleman I was talking to told me that no matter what happens, you want to stay away from the police because all the will do is try to extract money from you in whatever way possible.
We complain often with pleasure about our own government but seeing a dysfunctional administration makes one appreciate the own system a lot more.
having this said I am under the impression the system of corruption is slowly but steadily dying off. As India is moving forward, those problems seem to become smaller and smaller.

Another issue I believe will be tough for India the next few years will be the weak infrastructure. Right now India is growing at exorbitant rates, however it seems that the infrastructure (water, roads, electricity, phone etc) does not keep pace with the economic growth. Again, this is mostly due to a slow and inefficient government. In order to maintain the growth levels we saw in recent years, India needs to address these issues immediately and effectively.

All in all I have to say the trip to India was truly mind changing. Most of my travel was in the Americas and Europe. never before have I seen a country like India and never have I had the chance to see how business is done in this completely foreign cultural environment.
I'm very grateful that I got the opportunity to get a better understanding on what makes Indians tick and how to conduct business with Indian companies, not only in India but also as partners and suppliers in the US and Europe. Given the economic development and the shift of powers throughout the world this seems to be a skill that will turn out to extremely valuable in the near future.

Wednesday, April 28, 2010

"Story of India" Questions

2. During the first century CE, India's spices became the most important commodity in trade with the eastern Mediterranean. Demand for spices used in seasoning and preservation in the West spurred trade with India for cardamom, ginger, turmeric, saffron, nutmeg, and clove.
5. Boat building was one of India’s first industries (similar to spice trade). Indians were known for their large and durable ships.

1. Philologist see a connection between Sanskrit and other Indo-European languages (for example Latin or Greek). These languages have some astounding similarities. So is for example the greek word "mater", very similar to latin "meter”, and "matar" in Sanskrit. It is suggested that these languages have a common origin.
2. The Aryan immigration spread from Turkey in 9000BC to what is known as Iran today and into the northeast of India. The Aryans did not have a significant impact on the DNA, they did bring influence in form of language and culture.
3. Transferring mantras over generations is mostly responsible for keeping the caste system in its traditional state because its not simply a transfer of language but culture.

The Ganges River
1. To praise the god Ganga Hindus are bathing in the Ganges every day. They believe by this they can reverse sins and attain eternal salvation.
3. The idea of the caste system is deeply rooted in Hinduism therefore a simple ban by law did not away with the societal fact. It will take time to change the mindset of the Indian population.

Tamil Nadu
1. Spices were the most interesting good the British were interested in. Besides the trade with spices they found this region to be very valuable because of the fertility of the soil that allowed up to three harvests per year.

1. Even though we all have high-tech and IT etc in mind when we think about India, agriculture is still a very important sector of the Indian economy. The monsoon winds bring most of the water needed for agriculture. Some people say 80% of India’s rain is supplied by the monsoons.
2. The Anicut Dam provided much needed water to facilitate agricultural growth for a developing population. The dam divertes water to the delta and prevents it from flowing out to the India Ocean. The dam is over 1000 feet long and 60 feet wide and is till in use today even though it was built during the Cholan Empire.

1. India has been an important center of trade because it is essentially a connection between empires like China and Rome. Valuable goods like silk and spices were available in India and much sought after in said empires.

Fine Arts
2. Gold flowed into India because Romans wanted Indian goods such as spices and they traded it for gold and other precious metals. Indians used the gold to make jewellery while Romans used it for other purposes.

4. After the rebellion, the British strengthened their relationships to the Indians and no new land reforms were implemented for 90 years.

1. Throughout history in India the separation of church and state was widely accepted. I believe that this is largely responsible for the successful development of the country. As I understand there are uncountable different religions in India, if a government would advocate the advancement of one specific religious denomination it would cause tension within the society.

Science and Medicine
1. I think we live in a very fast paced and stressful world. People crave relaxation and spirituality. I think because yoga combines this with working out and physical fitness is the reason for growing popularity.
3. I don’t know if I can say the Indians invented zero, but at least they discovered it. The concept of zero is extremely important in mathematics making the Indian’s an important player in the advancement of this science.

Taj Mahal
1. The Taj Mahal was originally intended to be a tomb for Gauhara Begum, the third wife of Mumtaz Mahal (the Mughal emperor). The Taj Mahal represents a map of the Day of Judgment.
2. I find the giant dome that rises on top of the tomb most impressive. I think just looking at a building of this size will make me hold my breath in veneration.

1. Non-violence or non-injury (ahimsa in Sanskrit) is a precept common to three faiths that originated in the Indian subcontinent—Hinduism, Jainism, and Buddhism.
Hinduism identifies non-violence as an essential virtue in its ancient treatises.
Adherents to the proscription against can escape from the cycle of rebirth.

Partition and Independence
1. The Indian National Congress (t he country's strongest advocate for self-rule) and Jawaharlal Nehru faced heavy tensions between Muslims and Hindus. Ultimately a separation of India and Pakistan became inevitable.

Friday, December 11, 2009

The Post-American World Book Review

Zakarias book does not discuss the fall of America as the title might suggest but the rise of other countries (the others) and how this is changing the worlds political and economical power structure.
In the preface of the book Zakaria analyses the current financial crisis and how it’s related to globalization. According to his analysis the global financial crisis in 2008, could only happen because the debtors and creditors, across national borders cheered each other on, leading to a vicious cycle of out of control lending and spending.
The United States is a nation in which each household has an average of 13 credit cards and more than $100000 debt in mortgages and its entire economy relies on loans. I have to say that especially the number of 13 credit cards seemed mind boggling to me. I couldn’t find a statistic on how many credit cards the average German has but I assume it’s a lot less. My father for example got his first credit card a year ago because he wanted to rent a car. To my knowledge this is the only transaction he ever used his card for. My mother doesn’t even have a credit card and a lot of my friend don’t have one either. The predominant plastic money is debit cards. Also the fact that the average household owes 100.000 was quite interesting. In comparison the average household on Germany is 8078 Euros (approx. $12.000) in debt. I think besides the availability of credit and the differences in the tax code (in Germany interest is only partially tax deductible) there is also a cultural component. While it’s completely normal and acceptable to live on credit, being in debt has a negative connotation.
Zakaria goes on to present how China (in contrast to America) is very cautious and conservative in terms of borrowing credit. Over the past few years the Chinese have saved enormous amounts of money invested it not in their own country but loaned it out to countries like the US driving up the debt even further. Eventually, the giant house of cards collapsed in a giant crash leading to the financial crisis we are facing right now.
Zakaria notes that this crisis is particularly worrying because it originated in the capitalist country of the world, the United States of America.

The rise of the Western World and the emerge of the US as a super power
In history there have been three major shifts in power. In the 15th century science and technology, commerce and capitalism, the agricultural and industrial revolution led to the rise of the western world.
At that time China could have been one of the greatest seafaring nations of the world. The emperors of the Ming Dynasty, built ships so big which would have made Columbus’ Santa Maria look like a little nutshell. But then politics changed. The Chinese decided to isolate themeseves, burned their ships and prohibited their citizens from exploring the seas.
As a result, the Chinese culture stagnated, and they left it to the West to make the great discoveries of the modern era.
In the late 19th Century the United States ascended to be the undisputed number one in the world. Now, at the beginning of the 21st Century, we are witnessing the emergence of other nations, which previously stood in the shadow of the US in terms of economic and political power. There are countries such as China, Brazil, Mexico, South Korea, Taiwan, India, Argentina, Chile, Malaysia and South Africa who become more self confident and powerful.

The rise of the rest (the rise of asia)
Between 2000 and 2007 we witnessed an enormous boom in the global economy. Despite all the wars and the terror threats that shook the world, the world per capita income (per year) grew stronger than ever before. These conditions make the rise of other highly likely.
The free-floating capital without fixed exchange rates that became available in the ’70 and ‘80 enabled a limitless supply of capital for the entire world. Also new emerging technologies such as the internet flattened the world.

China - The Challenger
In the opening of chapter four, that analyses “the challenger” China, Zakaria notes that Americans are “truly dazzled by bigness”, naming a few examples for his argument. I found that passage particularly funny/striking because that was the first thing I noticed when I first set foot on US soil.
One other interesting titbit of information that I found quite interesting was the fact that in 1978, China produced about 200 air conditioners. About 20 years later the production rose to an incredible 48 million. The yearly output of air conditioners in itself is not very interesting but the unreal increase in that number demonstrates the almost unimaginable magnitude of change that happens in China. This development was triggered by a decision by the communist party leader Deng Xiaoping in December 1978, when he called for a focus on economic growth. He noted that “It doesn’t matter if it is a black or a white cat. As long as it can catch mice, it’s a good cat.” to underline the necessity to let facts not ideologies lead the path of Chinas economic development.
This policy was put into action with great success. Today, China has 400 million less poor people, the average income of the population has increased sevenfold and the economy is growing almost 10% on average each year.

India - The Ally
If we can believe the current predictions India is looking at a bright future. Compared to China India’s economy is still small but according to the latest data in 2020 India India will surpass Britain in terms of economic performance and is projected to become the worlds number three only 20 years later. India has a vast pool of well-educated young people which is one significant edge over China that suffers from a shortage of “human capital” which was brought about by the one-child policy.
Another main arguments for India is the fact that every citizen speaks English very well, a relic of Colonial times. Also India is an old democracy with all the important democratic institutions in place (at least in theory) which is also a cornerstone of economic prosperity. However corruption and waste of resources have become a pressing issue of the past few years.

American Power and American Purpose or “What will happen to the U.S.?”

While according to Zakaria China and India - the prototypes of the others - are on the rise, the
contours of the current economic nation's number one blurred. While the U.S. is not nearly as bad as is sometimes represented -- as an example the number of engineers graduating each year compared with the numbers in China and India is often quite distorted in the media.
Nevertheless, the US needs to prepare for new challenges. America still a superpower: economically, politically and above all militarily. During negotiations with other countries the US dominate these negotiations heavily. This shows how powerful the US are but sometimes also the arrogance in which this power is used.
The US must work on how other nations perceive it and in turn its partners will respect and appreciate US leadership. The international reputation of the US will determine the future role of the superpower in the world. The President must try to build good relations with all governments to be able to push an American agenda successfully and to resolve problems.

Final thoughts and comments.

I really liked the Post-American World. It’s easy to read, entertaining but also very informative at the same time. Zakaria presents a lot of data and numbers in his book but presents this data in a very interesting kind of way. However, I had the feeling that Zakaria repeated himself a few times in the book and went into too much detail in some parts.
At times Zakaria is almost bashing the US only to relativize that claim in the next sentence.
The fact the BRIC countries are on the rise is a commonly known fact these days, however I think Zakaria did a good job analyzing what that could possibly mean for the US. I really enjoyed reading the book and I would recommend it without hesitation to everyone who is interested in politics or world economics.

Sunday, December 6, 2009


Hey Folks!

This will be my personal blog for the MBA class "GSB 563 International Business Tour" at CalPoly Orfalea College of Business.
I will share my experiences and thoughts with you on these pages. Comments are always welcome!


Here is a map of our tentative travel route through India.