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India Inc. concerned about business climate!

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CIOL Bureau
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BANGALORE, INDIA: brand-comm, an integrated brand communications firm, recently announced the results of its all-India ‘India Business Climate Perception Study’ which unearthed sentiments about expectations for 2009 amongst Corporate India.



publive-imageThe state of the world economy is top of mind across management levels with a staggering 90 percent indicating that they are indeed concerned about the current global financial and economic crisis. Seventy percent of the respondents indicated that the happenings across the world have already impacted India to some extent. Another 28 percent indicated that it already has impacted the Indian economy to a great extent.

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Ramanujam Sridhar, CEO, brand-comm, said: “The Indian and world economy are wedded together. Some industries seem to be more vulnerable than others. However, we also found in our study that India Inc. have already started preparing now to ensure that they maintain their momentum even in an unpredictable world business climate.”

There was great optimism shown by respondents as more than 60 percent felt that there were indeed opportunities for India Inc to capitalize on but management should be more prudent, innovative and fast to take advantage.

India Inc. felt that the industries which will be well off in 2009 include: Education (95 percent of respondents), News & Media (89 percent), Healthcare (88 percent), FMCG (85 percent), Biotechnology (76 percent), Advertising and PR (70 percent) and Organised Retail (64 percent).



The companies that India Inc. feels will have a difficult time include: Airline/Aviation (75 percent), Real Estate (72 percent), Travel/Holiday (65 percent), Automobiles (58 percent) and IT enabled services (56 percent).

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“The coming year will see the “back to school” trend in the working professionals. We already saw 3 lakhs applicants sit for the Common  publive-imageAdmissions Test (CAT). We expect more people to go ‘back to school’ to increase their employability factor. The education sector will do extremely well, especially graduate programmes and distance education,” remarked Ms. Vidhya Srinivasan, COO, brand-comm.

India Inc to innovate, cut costs, share resources and increase in-house training

Two-thirds of the respondents (66 percent) indicated that their current company is poised to handle the challenges ahead. This is an indication of how India Inc. has already started putting certain strategies in place.

The keyword for the businesses in 2009 will be Innovation (71 percent); not only in products and service offerings, but also in terms of technology and marketing efforts. Other popular strategies that will be employed include sharing resources/using existing resources more efficiently (87 percent), cutting costs across functions (85 percent) and slowing down recruitment (82 percent).

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Sixty two percent of the respondents indicated that businesses will increase in-house training; consequently reducing their expenditure on external training. Interesting enough, a resounding 61 percent indicated that their companies will not take risks to overcome challenges.

“In many ways, most of India Inc is traditional and methodical, we would expect businesses to innovate but stay risk averse,” Sridhar added.

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Marketing strategy to change; increase in on-line medium and direct marketing

According to the survey, traditional advertising (TV/Print campaigns) will give way to other marketing activities. Sixty six percent of the respondents do not expect a rise in corporate advertising budgets in 2009. When asked, “Which marketing activities will increase, decrease or remain the same in 2009 compared to 2008?”, nearly 30 percent of the respondents felt that their company will decrease expenditure on traditional advertising.

Most respondents indicated that marketing outlays will be increased in Direct Marketing (42 percent) Public Relations (42 percent), Online advertising (38 percent) and On-line Marketing (SEO, Social Media: 39 percent).

Ms. Vidhya Srinivasan remarked: “Companies will follow the 80:20 principles. They will focus on targeting the 20 percent of their target audience that accounts for 80 percent of their revenues; one way is through direct marketing and on-line marketing.”

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Interesting differences among top management and executive levels

The study revealed some interesting differences in opinion amongst the senior management and mid to junior management.

We found that Top Management was more optimistic in general compared to the other levels. In fact, there is a great deal of uncertainty of

what is going to happen amongst the younger generation. Also, at the mid-management level, nearly 34 percent were unsure of the capabilities of their firm or firmly believed that their company was not poised to take on challenges.

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Sridhar revealed, “Top management may be in control of the situation and have a plan of action, but that needs to be clearly articulated to all levels within the company. This is the key to ensuring that goals are reached.”

We also found that the top management felt that more industries were in trouble compared to the mid-management and executive level as seen in the below chart.

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The industries seen to be trouble by all three groups include: Airline/Aviation, Real Estate, Financial Services and Travel/Holiday.

Whereas, Top Management feels that IT, IT Enabled, Automobile and Hotel/Hospitality sectors will face obstacles in 2009. Mid-management shares the same sentiments for the IT and IT enabled industries.