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The new dean of the Harvard Business School, Indian-born Nitin Nohria, recently made this statement about Indian Engineers:
You have done a pretty good analysis of the entrepreneurial ecosystem in India and the one big reason why we haven’t seen a major global product coming out of India is the cultural barrier which somehow doesn’t breed innovation. Being from the one of the hyped Indian Institutes of Technologies, I have observed that despite having the talent and adequate opportunities not much innovation comes out of even these institutes because traditionally we Indians have been risk averse. However, I believe (and definitely could sense) that next generation of ground breaking innovation will come from India especially to ameliorate the conditions of its 40% of the population which still lives below poverty line. Thus, I also don’t agree with you that “Indian levels of entrepreneurial activity have been steadily decreasing over the past few years” as I believe that people in India are coming up with some unique concepts and building some great companies to resolve some of the complex issues of our times.
Thanks Ankit. The comment regarding declining entrepreneurship rates in India actually comes from the Total Entrepreneurship Monitor report which measures entrepreneurial activity as a percent of GDP. The numbers have been declining over the last decade:
2003 – 17.9%
2006 – 10.4%
2007 – 8.5%
2008 – 6.9%
However, I do agree with you that the seeds for innovation are being sown in the new generation.
I just spent the last few months living in India and working for an Indian IT firm. This article is definitely on track in saying that there is a lack of innovative thinking in Indian businesses. Much of this comes from the cultural restraints put on people through the entirety of the Indian education system. People are taught at a very young age to respect and honor the very high power distance that is ever-present in almost every institution in India. As a result of this power distance, people are discouraged from questioning authorities and thus never develop creative problem solving skills both in school and in the workplace. As with anything, there is a positive and negative side to how these traits have manifested themselves in the business world. On the plus side, there is a large talent pool in India that is highly educated and process oriented. For this reason, the population is primed to work in areas of engineering and information technology, utilizing delivery models that focus on large teams of people. In areas of entrepreneurship and business leadership, there is still a ways to go before the general population can learn to excel in these areas.
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