Cisco’s John Chambers is calling the current economic scenario “the biggest opportunity of our lifetime”, and asking managers to shift from a centralised approach to a more collaborative one. Of course, Cisco as a company has much to gain from the growth of collaborative network organisational models, but he does have a point.

But will it be simple to make that shift? After decades, maybe centuries, of command-and-control behaviour training from kindergarten, it will take more than a few months for people to learn how to collaborate. Remember the management adage: “Lead, be led or get out of the way”? May be time to question even that. I’m not suggesting that there is no further need for leaders, but Jim Collins’ Level 5 Leadership (or even a more evolved form) needs to be adopted, for true collaboration to happen rather than a push / shove / cut & chop. Many current management models have to be thrown out and new ones implemented, and even old ones re-discovered. While we may not realise it (or may not want to see it), many of the current management models are quite feudal in nature.

What’s more – and I might be out on a limb here – we may even have to de-construct our whole economic model which is built on the principle of “scaling up and consolidation”, in favor of fragmentation and individualisation.

A very very good documentary to watch in the current times is “The Corporation”, other than digging into the host of other literature that is available.

I’ve just spent a few (grim) days at the National Retail Federation’s conference in New York – the NRF Annual Big Show. (After all that grimness, I hope you’ll pardon my play on words in the title!)

However, the key message from several conversations is that this is an ideal time for the better companies to use this opportunity to take tough decisions, and to create change that is hard to push when the business is doing well.

I think that is sound advice to not just get through these recessionary times, but also to pull far ahead of the competition.

The title of this post is from a Winston Churchill quote that I came across a few days ago. I thought this is a must-have on the desk of every entrepreneur in the current times to look at every day, maybe several times each day.

But why only entrepreneurs? Any one and everyone who has been touched or fears being touched by the economic downturn needs to keep this thought in mind.

A few days ago I heard an impassioned monologue from an entrepreneur, founder of a mid-sized listed brand manufacturer & retailer in India, when the first two of the big investment banks in the USA collapsed. He repeated one theme of despair several times – “How can there be wealth / money available at the closing of the business day, and then suddenly in the morning such a well-established institution is no more – all the wealth seemingly lost overnight? Is nothing certain?”

Sometimes an important part of building a great business may just be having the ability to live through a downturn.

Here’s another quote from a Forbes article titled – “The Greatest Risks They Ever Took”: …Kit DesLauriers, the first person to ski from all seven summits. Of her descent from the top of Mount Everest, she says: “There were no safety nets, no fixed lines established, freezing winds. We had to spend an unplanned night at 26,000 feet, with very little food and water. The next day, we skied the Lhotse Face, 5,000 feet of blue ice on a 50-degree slope…At one point, we ran out of oxygen. I kept telling myself: “Don’t sit down and die. Just keep going.’ It’s really easy to let your mind get a hold of you, but the journey taught me we are much more than our minds.” (The whole article is available here.)

Times like these are mainly about mind-games that we play against ourselves – the daily newspaper, the stock ticker on TV, the conversations in the hallway all contribute to the feeling of helplessness. But the biggest freefall is within us. So, remember Churchill’s thought: “If you feel you’re going through hell…just keep going.”

The Textile and apparel industry is of particular importance to India. It not only provides employment to a broad base of semi-skilled and unskilled labour but also helps to extend the economic bounty to urban and semi urban areas. Though India has a history of thousands of years in global trading of textile, it contributes only 3% to the global exports of textile and clothing.

While the urge to grow exists, there is a huge difference between the current exports of about Rs. 864 billion (US$ 20 billion) and the target of Rs. 2,500 billion (US$ 55 billion) by 2012. To achieve this vision, exports must grow at around 25-35 per cent a year for the next 4 years, depending on how weak or stable the current year is. This growth rate seems difficult considering the fact India has actually grown its exports of textiles and apparel at an annualized growth of a little over 14 per cent from 2003-04 to 2007-08.

Even if the industry looks at increasing the volume of exports to achieve the vision, the ports do not have the handling capacity considering that they currently operate at 91 to 92 % of available capacity.

Hence, incremental thinking will not help to achieve the vision.

Our key concern is the value “lost” by the industry. Being the low cost supplier does not necessarily translate into greater market share. The Indian Industry must look at enhancing the value delivered rather than competing on the cost platform. Indeed, India compares poorly to other countries on the value captured per employee.  (For instance, if the export value captured per employee in India was as much as Turkey, India’s exports would be close to China’s exports of US$ 161 billion.)

One major concern that needs to be addressed is that India’s exports are still weighted in favour of raw materials and intermediate products, rather than finished products. Apparel exports account for only 41% of India’s textile exports in 2007-08. India’s product mix also needs to be aligned to global market needs, rather than only focussing on “traditional strengths” – this includes enhancing the share of non-cotton products in the basket.

Another area that is neglected is the inherent competitive capability of developing new products. The industry needs to develop and nurture these skill sets to create a sustained competitive advantage in the global scenario. India already provides buyers with value in terms of product development and design, which needs focus and further strengthening.

Further, India’s domestic industry, and its skill at understanding market needs, creating and merchandising product, can also play a valuable role in the industry’s growth.

The competitive advantage offered by being able to influence the development of a product is immense. And given that sourcing lead times are shorter in unpredictable times, a supply base that has been involved with the buyer right from the development stage of the product is most likely to get the final order. Third Eyesight proposes a four dimensional model: Define, Design, Develop and Deliver so as to achieve the industry-wide development, of projecting India as a valuable supplier, and sustaining its value needs.

By creating an ecosystem focused on design and product development, India can create and capture the billions of dollars worth of value that is being lost to other countries.

This is an extract from Third Eyesight’s report presented at the FICCI 3rd Annual Textile And Garment conference in Mumbai. The report was released by the Minister of Textiles, Government of India. To download the full report prepared by Third Eyesight, please click here.

To discuss how we can help you with your specific business needs, please get in touch with us via email (please send it to services [at] thirdeyesight [dot] in) or via this form: CONNECT.

Why do entrepreneurs start companies? Why do individuals form organisations?

An obvious reason is that they cannot do everything themselves. Another is that they don’t have all the resources / skills that are needed to grow the business. If they work well, teams can certainly achieve more than individuals alone.

However, another compelling reason comes to mind for creating an organisation – the concept of immortality.

All living beings are susceptible to the phenomenon of “death” at some point of time or the other, and immortalise themselves through producing the next generation through reproduction.

Just as reproduction is a way to immortalise the genetic code of the species in our next generation, organisational development is a way to immortalise the “genetic code” containing ideas, principles and philosophies.

However, this can only happen if the leader / founder / entrepreneur faces the Big Reality: “I am mortal”. Once he or she faces that fact, there are two choices for him / her – the organisation / business can die with him or her, or there can be another generation to carry on the genetic code.

Mortality is the root / route to immortality. If one is truly wedded to the principles of the organisation, one will create the framework and the environment for the next leadership to emerge, and will nurture the next generation to the leadership position.

The route / root to Immortal is “I M Mortal”!

A couple of great resources come to mind, both from Jim Collins and his co-authors: “Built to Last” and “From Good to Great”. (A great concept from the latter book is that of “Level 5 Leadership” which is well worth a read.)