Presentation made by Tarnbir Kaur of MCI India/MENA region at the ASAE International Conference 2012

1. 2012 Association International Conference
Land of Opportunity and Challenge:
Build and Expand Business in India
Tarnbir Kaur, CAE- Director,
Association Management & Consulting, MENA & India

2. Our Agenda
Why India?
How India is unique?
Size of opportunity?
Understanding associations
Challenges
Strategies to use

3. Why India?

4. India – Overview
• WEF Ranking of 51
• Stage 1 - factor-driven country markets
• Phased planning process since independence

5. Rise of Middle Class in India
Huge Market for Global products and
services
• Average household incomes to triple over the next
two decades
• World’s 5th-largest consumer economy by 2025
• By 2025 India’s wealthiest citizens will total 24
million
• Urban population to expand from 318 million to 523
million in 2025
5

6. Increasingly young population
Young Population which will augment
productivity of the Nation
• Over 35% of India’s population is below the
age of 20
• Surplus of 47 million working people by
2020
• Dependency ratio to drop from 60 today to
48 by 2025
• Disparity in growth throughout the various
states
6

7. Gradually improving Business Environment
• Commitments to infrastructure more
than 9% of GDP
• Involvement of private sector
increased in all aspects of
development
• Roads, Port, Power, Highways,
Airports, Railways, Telecom and IT all
a key priority for the government and
have made remarkable achievements
7

8. Economic progress despite global recession
 Growth driven by a step up in value chain in IT,
pharmaceutical, manufacturing
 FDI into India remains unaffected by the global
slowdown
 Manufacturing, communication services and the real
estate sector major drivers of FDI
 Special economic zones to accelerate exports
8

9. Leading Industries by sector
Top sectors attracting FDI equity inflows into India (FY11)
Source: “Doing Business in
India 2011” by Earnest & Young
India’s 12th Five Year Plan

10. Frugal innovation leading to effective solutions
Frugal innovation emerged from drive innovation despite
limited resources and financial constraints
 Frugal products in the market in all sectors such as cars, consumer
durables, banking solutions and computers
 Concept not new as demonstrated by the Six Sigma dabbawalas
delivery system
 International companies leading frugal innovation in their Indian
operations
 US $ 35 Tablet – Akash
 Entrepreneurial, indigenous companies
10

11. Urbanisation
Source: “India Outlook 2011-12” by D&B “India Outlook 2011-12” by D&B

12. India’s Consumption Basket
Source: Gale

14. Pronounced Skill Gaps
“We will need to ensure far greater availability of educational opportunities at the
higher education level so that we have not just a literate youth but a skilled youth,
with skills which can fetch them gainful employment. As our economy booms
and as our industry grows, I hear a pressing complaint about an imminent
shortage of skilled employees. As a country endowed with huge human
resources, we cannot let this be a constraint.”
Indian Prime Minister Manmohan Singh, Independence Day
speech-2006

15. India- skill pyramid
Source: FICCI and IMcas

16. Import of Higher Education in India
Lack of quality institutions in India leading to interest from
western universities
• India (11%) higher education compared to US (82%)
• 185,000 Indians study overseas and spend US$ 13 Bn
• Opening up of higher education sector recommended by National
Knowledge Commission (NKC)
• Foreign university partnerships increasing in India
16

17. Participation of Private sector in Education
to close skills gap
Phenomenal growth in private education predicted in the higher
education sector
• Ranking of 85 on the WEF Global Competitive Index pillar - Higher
education and training
• 30private equity and venture capital investors worth over $300 million
• Education sector in India expected to reach US$64B in 2013 and
US$107B in 2018
17

18. Growth Sectors and Manpower needs

19. Popular and most in demand professions by
employers seeking labour
Based on research done by www.naukri.com, India’s
no. 1 job site, top jobs in India are in:
• IT Software
• BPO (Business Process Outsourcing)
• Sales
• Finance
• Marketing
• Engineering
• HR Administration
• Government jobs
• Telecom

20. Sectoral Growth Rates
The 5- year Plan indicates that government policy
supports an investment plan in the following 14 sectors:
• Energy • Education and skill
• Transport development
• Sustainable management of • Social and regional equity
natural resources • Challenge of urbanisation
• Rural Transformation • Science and technology
• Farm sector • Services: Tourism, Hospitality
• Manufacturing sector & Construction
• Health • Governance
• Innovation

21. 21

22. Understanding India
Before Liberalization After Liberalisation
Contentment and Stability Striving to keep up with others
(Hindu rate of growth)
Swadeshi (Indian products) Making world class products that
can be exported
Self reliance Efficiency
Isolation Exposure
Ideology Pragmatism
Protection Enabling Competition
Skepticism about technology Embracing and using technology

23. Understanding India
Indian Values Western Values
Patriarchy Egalitarianism
Ambiguity, Adaptability Clarity, linearity
Low dissonance Need for resolution
Socially defines roles Individually chosen roles
Patience and passivity Impatience, assertion
Continuing with tradition Constantly seeking change and
novelty
Happiness= self harmony Happiness=material gains
Respect for age Respect for youth

24. Understanding India
• Unique growth patterns and trends
• Managing plurality
• Constantly changing

26. Associations in India
• Vibrant association culture
• Easily incorporated under Society Act
• Professional associations not very evolved with
successful revenue models
• Concept of lifetime membership
• Value conscious market
26

27. Indian Associations
• 57 professional societies and 108 trade associations
in India
• Among the total 165 associations, 41 have
membership >1,000, accounting for about 25%.
Source: Gale

28. Popular certification programmes in India
International Certifications
Certification Association
Chartered Wealth Manager American Academy of Financial
Designation (CEM) Management
India Certified Crop Adviser American Society of Agronomy
(CCA) (ASA) Finance Certifications
Certified Technical Analyst Association of Technical Analysts
(CeTA) (ATA) Certification Issued Organisation
Project Management Project Management Institute Certified Financial Planner Indian Institute of Financial
Professional (PMP) (PMI) Education Programme Planning
Certified Internal Auditor The Institute of Internal Auditors Certificate Course in Project Indian Institute of Banking and
(CIA) (IIA) Finance Finance
Certificate Programme in
Indian Institute of Quantitative
Quantitative Finance and Risk
Finance
Local IT Certifications Management
Certification Issued Organisation
VMware Certified
VMWare
Professional(VCP)
Microsoft Certified Systems
Microsoft
Engineer (Security) (MCSE)
Cisco Certified Network
Cisco
Professional (CCNP)
Certified Information Systems Information Systems Audit and
Auditor (CISA) Control Association (ISACA)
Certified Information Security Information Systems Audit and
Manager (CISM) Control Association (ISACA).

29. Lifetime membership fees
Association INR USD
Computer Society 8,500 160
of India
Indian 6,728 127
Pharmaceutical
Association
Association of 5,000 95
Physicians of India
The Association of 1,500 28
29 Engineers, India

30. Association event registration fee
Association INR USD
Computer Society of 2,000 38
India
Indian Pharmaceutical 5,000 95
Association
Association of 4,500 85
Physicians of India
The Association of 3,600 68
Engineers, India
30

32. Challenges
• Corruption
• Complicated tax and legal structure
• Infrastructure
• Government control
• Administrative and political reform
32

33. India- ease of doing business
Source: World Bank

34. Regulations (For profit organisations)
Foreign entities who want to trade in India or carry out
their operations can carry out in the following forms:
• Through a full fledged representative in India taking management
decisions and carrying on business in India as an Indian Entity this
may be referred to as the Permanent Establishment in India.
• Through a representative limited in transactions in India – i.e. the
basic management rests out of India and only the representative is
there to facilitate a contact between the customer/client and
company.
• Through a 100% subsidiary incorporated in India called the Indian
Arm.
• Through a Liaison office
34

35. Success achieved by “Global Indianised” products
Only global products that have reviewed the needs of the
Indian market and adapted accordingly have been successful
• Continued success of Indian companies such as Infosys, TATA, Reliance,
WIPRO and ICICI over its international competitors
• Success of international companies such as Google, Nokia, LG and
Facebook that have adapted to local needs
• Price conscious consumers and dramatically different needs for various
segments needing different products for each segment
• Local management teams that understand the local culture, needs and
challenges.
With the demand being driven by needs that are arising from local requirements,
will your association be able to customize or innovate some of its products from
content, pricing and delivery methods to meet the local demands?
35

36. Strategies for Growth
• Its all about relationships
• Creating relevance for many segments
• Creating perceived value advantage
• Getting business economics right
• Multipronged strategy
36

37. Thank you for your attention
Tarnbir Kaur, CAE
Director- Association Management and Consulting, MENA and India
MCI Group
+971 4 3116300
Tarnbir.kaur@mci-group.com
www.mci-group.com