“Companies operate with an implicit societal compact, and part of that compact is to respond in times of need when no other institutional mechanism- namely the State and Civil society- are operative”- says Tarun Khanna in his latest article featured in India Today about institutional voids and how should companies look towards compensating them in the developing economies.

The author of ‘Winning in Emerging Markets’ emphasizes on the fact that once a company learns to operate within the limitations of an emerging market, it can itself develop a competitive advantage.

Prof. Tarun Khanna will be moderating a panel at the annual meeting of Academy of International Business’ on 28th June 2010 from 10.45 am (Rio time) at Rio de Janeiro on ‘Corporate Brazil’s lessons for the world.’


Brazil Plenary: Organized by Tarun Khanna, in collaboration with Betania Tanure, and entitled “Corporate Brazil’s Lessons for the World”, this event will bring together distinguished Brazilian business leaders including Andre Bier Gerdau Johannpeter, CEO, Gerdau SA, Pedro Parente, President and CEO, Bunge, and Decio da Silva, Chairman of the Board, Weg SA. They will discuss Brazil’s political economy and institutional environment, the global competitiveness of Brazilian industries and companies, and the critical challenges faced by Brazilian business in times of crisis.

Know more about the AIB 2010 annual meeting
Location: Academy of International Business, Rio de Janeiro
Time: 28th June, 10:45am (Rio time)

Are you planning to attend the event? Feel free to leave a comment.
Prof. Tarun Khanna will be present at Insper in Sao Paulo on 24th June for a book talk from 1.30-3.00 pm (Sao Paulo time).
Location: Insper, Sao Paulo
Time: 24th June, 1:30 to 3:00pm (Sao Paulo time)

To know more about Insper click here


Are you planning to attend the event? Feel free to leave a comment.

Prof. Tarun Khanna will be giving a lecture at Three on the Bund in Shanghai, China.

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Prof. Tarun Khanna will be giving a lecture at the AgriVision 2011 in Netherlands.

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  • Krishna Palepu speaks to TechAmerica in Portland, Oregon, May 10, 2011

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Meet Prof. Krishna Palepu at an event organized by the HBS club of Norway.

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Meet Prof. Tarun Khanna at an event organized at the Bombay Stock Exchange in Mumbai.

Timings:6 pm IST

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Meet Prof. Tarun Khanna at the inaugural lecture of SKS Microfinance at Hyderabad.
Timings:5 pm IST

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Meet Prof. Tarun Khanna at an event organized at the Indian Institute of Management, Bangalore.

Timings:5.15 to 7.15 pm IST

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Prof. Tarun Khanna will be addressing an event of the Confederation of Indian Industries (CII).

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Prof. Tarun Khanna will be moderating a panel at the annual meeting of Academy of International Business’ at Rio de Janeiro on ‘Corporate Brazil’s lessons for the world’.

Timings: 10.45 am (Rio time)

click here for more details

Meet Prof. Tarun Khanna for a book talk at Insper in Sau Paulo.

Timings: 1.30-3.00 pm (Sau Paulo time)

click here for more details

Book Review: Winning in Emerging Markets

Forbes India brings out a review of “Winning in emerging markets” in its June 12th issue highlighting “case studies of multinationals that have navigated tricky environment.”

Read the entire article here

Recently New York Times talked about Mc Donald’s entry in Russia and how 20 years hence, is outsourcing its last of 200 ingredients, in its article “Russia’s Evolution seen through Golden Arches”.

Read the full article here

“We discuss how to think about this case study in Chapter Four of our book.  As the NYT article says, McDonalds’ entry into Russia required it to invest in a variety of services that it took for granted in other locations – getting potatoes with the right texture and consistency, and getting them in a very timely fashion was difficult, given the absence of the right supplier base; making sure there were logistics providers who could adequately deal with McDonalds’ needs was hard, nor did many logistics providers who served McDonalds elsewhere wish to expand into Russia at the time.   In the language of our framework, there were lots of missing services – institutional voids – in Russia at the time, and McDonalds had to fill these voids to launch its operations, even though these services were not part of what it would consider ‘core.’  Over time, as these voids have been filled by independent entities, McDonalds has withdrawn from these businesses.  The operation, needless to say, has been quite successful.  It is a good example of the framework, and how multinationals have to think about adapting to particular contextual circumstances in emerging markets.”, -Authors, Winning in Emerging Markets.

Do you agree? Looking forward to your comments and experiences in similar situations.

Does democracy hinder growth?

When a comparison is made between two of the largest Asian economies- India and China, China always seems to outshine India in its pace of growth. China’s developed infrastructure and tightly controlled, Government run business models are a contrast to the developments taking place in the Indian economy at concurrent time frames.

Is it democracy which is proving to be an impediment to the economic development of India while its absence triggering China’s growth?

Al Jazeera interviews Tarun Khanna on the issue.

Read the interview here

Potential for Sino-Indian Collaboration at the Microeconomic Level

Q (Question): What is the possibility of China and India emerging from the economic crisis?
A (Tarun): China and India are complementary economies. While there are many opportunities for partnerships at the macro level, I am particularly optimistic about the potential to collaborate at the micro level. I believe economic cooperation will supercede current border conflicts.

Q: What are potential areas for collaboration?
A: Biotech due to differences in genetic composition; Microfinance – India has a lot of experience; China is gradually open its doors to foreign participation in the sector

Q: How can Chinese companies have successful M&A transactions like the Tatas of India? Is this a good time for global M&A?
A: Chinese M&A has not been successful as seen from CNOOC’s failed attempt to acquire Unicol. This is not due to the English proficiency of Chinese managers but rather the understanding of Western culture as well as political opposition. I recommend Chinese companies to start by purchasing smaller businesses and practice what Zhou Xiaochuan suggests of being down-to-earth and pragmatic.

Q: How does the role of government differ in these two countries?
A: China too strong but world-class policy making; India too weak due to constant political turnover.

Q: How do Chinese and Indian entrepreneurship differ?
A: Indians are encouraged to experiment. I recommend youth of both countries to visit each other’s countries to better learn about each other.

Q: Why do China and India’s development models differ?
A: India is a far more diverse country than China. This diversity has eased the internationalization of India. Chinese society is comparatively more homogeneous, thus there are many opportunities for it to learn from my diverse societies.

Read the original Chinese version here

In 2001, when Jim O’Neill of Goldman Sachs coined the term BRIC economies, he claimed that by 2050 the combined economies of Brazil, Russia, India and China could eclipse the combined economies of the richest countries. Of course, O’Neill didn’t take the 2009 financial crisis into account while making this prediction. The tremors caused by the latest global financial crisis seemed to have shifted the centre of economic gravity to the east — China , to be precise. But it still carries the tag of emerging economy. Even in the middle of the global turmoil, China may have continued to grow, but the west still sees it as a source of easy cash and cheap products.

It’s almost the same story for India, Brazil and Russia — seen as sources of cheap labour, raw material and good services or as attractive markets, despite their efforts to turn their financial muscle into political clout. In this book, Harvard business gurus Tarun Khanna and Krishna Palepu have tried to explain the complex nature of the emerging economies and have recommended strategies big companies should adopt to “win these markets” .

Read the complete story here

“Winning in Emerging Markets” by Tarun Khanna and Krishna Palepu – excellent new book by my HBS colleagues about succeeding in building businesses in the emerging markets – Bill George

Read his post here