hema krishnan-grgs-2016-global economic themes and india
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GLOBAL ECONOMIC ENVIRONMENT
Themes & Implications for IndiaDr. Hema A. Krishnan
Professor of Strategy & Global BusinessXavier UniversityCincinnati, U.S.A.
GRG School of Management StudiesCoimbatore, July 2016
THE COMPONENTS OF A COMPANY’S MACRO-ENVIRONMENT
Source: Thompson, Strickland, Peteraf, Gamble
GLOBAL ECONOMIC THEMES FOR 2016 AND BEYOND; THE OPPORTUNITIES
GLOBAL ECONOMIC THEMES FOR 2016 AND BEYOND: CHALLENGES Increased Inequalities in the world Political instability Availability of capital not uniform Use and misuse of big data Increased Ethnocentrism/ nationalism; EU,
U.S.A, Asia, Middle-East Crash of oil and other commodities prices Rise in terrorist activities Health, Education and Environmental
Issues
WORLD DEMOGRAPHICS IMPACT ON ECONOMIC TRENDS
If the world were 100 people . . .
IF THE WORLD WERE 100 PEOPLE . . .
GENDER
49 Female / 51 Male
Slide Source: Dr. Mee-Shew Cheung’s presentation
WHAT ARE THE ECONOMIC AND SOCIETAL IMPLICATIONS? SOCIETAL: ↓; ECONOMIC ↓
GENDER
49 Female..falling / 51 Male…..rising
REGIONS 60 Asians 14 Africans 12 Europeans 8 Latin Americans 6 US/Canadians
IF THE WORLD WERE 100 PEOPLE . . .
Slide Source: Dr. Mee-Shew Cheung’s presentation
REGIONS 60 Asians 14 Africans 12 Europeans 8 Latin Americans 6 US/Canadians
ECONOMIC IMPLICATIONS. . .WHERE IS THE CENTER OF GRAVITY? INDIA, CHINA
Language
17 Chinese 8 Hindi 8 English 7 Spanish 4 Arabic 4 Russian 52 Others
IF THE WORLD WERE 100 PEOPLE . . .
Slide Source: Dr. Mee-Shew Cheung’s presentation
Economic implications of Language for online companies
17 Chinese 8 Hindi 8 English 7 Spanish 4 Arabic 4 Russian 52 Others
IF THE WORLD WERE 100 PEOPLE . . .
31 Christian 21 Muslim 14 Hindu 6 Buddhist 12 Other Religions 16 Not Aligned
IF THE WORLD WERE 100 PEOPLE . . .
Slide Source: Dr. Mee-Shew Cheung’s presentation
Economic Implications of Religion
Restaurant Industry Consumer Products Health & Education Textiles and Apparel Media Leisure & Entertainment
IF THE WORLD WERE 100 PEOPLE . . .
→ECONOMIC SHIFT TO BRICS
BRAZIL AND RUSSIA ISSUESThe Economist refers to these nations as “submerging economies.” Russia, more than Brazil!
Slow GrowthFalling currenciesHigh Inflation Huge DebtFalling global demand for – minerals, oil pricesSanctions against Russia for annexing Crimea
Demographic Advantage translates to economic advantage
+China’s economic reforms since the late
1970s and India’s since the early 1990s,
+Dramatic rise in entrepreneurial activitieshave shaken the global economic order
INDIA AND CHINA HAVE A STRATEGIC ADVANTAGE
Competitive Environment India and China:
• As consumers• As suppliers• As competitors• As collaborators
Between themselves and for the rest of the world
GLOBAL ECONOMIC THEMES FOR INDIA BEYOND 2016-THE CHALLENGES ( ↓ )
Increased Inequalities in the world; ↓ Increased political instability in world; ↓ Increased Ethnocentrism/ nationalism; ↓ Rise in terrorist activities; ↓ Health, Education and Environmental
Issues; ↓
GLOBAL ECONOMIC THEMES FOR INDIA BEYOND 2016-THE OPPORTUNITIES (↑)
Huge population at the Base of the Pyramid (BOP); ↑
Rise of the Millennial generation; ↑ Rise of online companies and services; ↑ Use and misuse of big data; ↔ BREXIT and EU: its impact on India; ↑ Crash of oil, other commodities prices; ↑
GLOBAL ECONOMIC THEMES FOR INDIA BEYOND 2016-THE OPPORTUNITIES (↑)
Africa; emerging force; ↑ Product innovation, differentiation-
combine eastern & western practices; ↑ Pace of technological change; ↑ Telecommunications revolution
CLASS EXERCISE
Team 1: Describe how India can nurture and channelize its BOP (Base of Pyramid) to influence the global economy.
Team 2: Describe how India can take advantage of falling oil and commodity prices to improve its economy.
Team 3: Describe what India should do to improve its presence in the African continent and what it can offer that China cannot, to improve Africa’s economy.
Team 4: Describe how India’s online economy can influence the global economy.
WHY INDIA’S MBAS WILL INFLUENCE GLOBAL ECONOMY
Skill-set advantages: Education, Multi linguistic, Entrepreneurship, Work ethic, Jugaad
+Political & Legal Environment: Democratic institutions, Rule of Law..role model to developing world
+Demography advantages: Rising Middle-class, Rising Millennials, BOP….Knowledge transfer to other nations, notably, in Africa and Middle-East
+Socio-cultural changes: adaptive culture
HOW SHOULD MBAS CAPITALIZE ON OPPORTUNITIES
Build sound foundation skills Act with honesty and integrity Build Strategic Leadership skills Cultivate big-picture thinking skills Build sound written and oral communication
skills Build long-term, mutually beneficial
relationships with other nations Focus on life long learning Build stress management coping mechanisms
Images embedded in this presentation were obtained from Google.
MBA second-year students from GRG School of Management studies actively participated during this session.
Administrators and faculty of GRG School of Management studies, Coimbatore, India, made this session possible.
ACKNOWLEDGEMENTS
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