IT companies must change rapidly — Ghoshal

"I see companies like human beings. They are deeply emotional, they share a heritage. If you disect the changes of the past — from the license raj, companies have moved on to local competition, and from local competition to global competition. And then the challenge of the new economy. Much of corporate India is hit by tripple whammy."

"If you may ask what is basis of success; the answer would come as artificial scarcity to sustainable competitive advantage. What is the purpose of a company? In the older sense it was owner’s personal wealth, and now it is corporate earnings. Which is the key to strategic resource? Earlier it was influential connections, and now it is financial capital," Ghoshal said.

"However, some of you were not even born when the license raj was on. You are a product of the new economy — which is much more fundamental, with new games and new rules. So, today corporate earnings is not as important as customer value creation. Similarly, financial capital has moved on to human capital, which is more important," he said.

He said that the question is how career paths of each individual can be managed, and as to how each individual becomes the best that he or she can be. "It is not how HR can be alligned to business strategy, it is to see how people can be a strategic resource," he said.

Ghoshal also flung a flurry of thought-provoking, relevant queries at the IT managers in the audience: Are we competitive on human capital? What does a leader do when he realises that people are a scarce resource? Are you leveraging the collective intellect? Have you lightened the passions of individuals with the overall vision and purpose of the organisation? Have you bonded people through a sense of ownership, independence and pride?

"It may be easy to comprehend these, but very hard to implement on a day to day basis," he said.

Dwelling on the recent issue of Chinese goods being dumped into the country, Ghoshal said: "Will we once again snatch defeat from the jaws of victory? The panic of Chinese imports — it is locks and toys today, it may be software tomorrow. While the government executes its act to overcome the risk, the much bigger challenge is doing business in a radically changing environment."

He said that the industry has been the engine of growth to increase for customer, shareholder and the entire economy. "But going beyond the economy, you have enhanced the pride of the nation — with India becoming part of the global league; an economic contribution to the nation’s self confidence and pride," said Ghoshal, adding that the most important contribution is having served the forces of modernisation and modality.