Fortune India has come out with its first ever list of Top 50 admired companies in India. This is a popular list at world level from Fortune International, but the first one in India. This is a list of admired companies – not necessarily the largest or most profitable. I remember GE being the most admired for years in the international rankings.
The 9 parameters taken – 3 reflecting financials, 2 on people (leadership and talent mgt), 2 on products (quality and Innovation) and 2 on corporate governance/social responsibility – seem to be a comprehensive (always arguable) set defining “admiration”. I would have loved to see customer satisfaction manifested more blatantly as one of the top parameters, in some way. Of the 9 parameters chosen, the one which lights my fire personally is one of the 3 financial parameters – Endurance – Fortune defines it as “the consistency of overall performance (financial and others) that companies have displayed during recession or other lean periods”. They mention “financial and others”, but who are they kidding, right ? According to me, it must be all financial. But that’s not the point I want to pick up – performing in adverse conditions is a superb parameter picked up through Endurance. Sailing with the tide is easy – everyone rises. This also exposes the character of the company and the robustness of its business model – whether it is “built to last” or “to break up fast” ? By now, I have seen enough companies and eerily even sectors which have very low Endurance scores. More on that later…
Anyways, overcoming my infatuation with “Endurance”, moving to a bit of slice and dice of the companies themselves. Of the Top 20, there are 5 from FMCG, 4 from Oil & Gas, and a whopping 6 from IT/ITES ! One each from metals, auto, auto components, apparels, infra (guess who ? thanks to Mr Naik…so far). Tata Steel at No. 1 along with TCS at 5, Motors at 6 seal the discussion on which is the most admired group in India. Both Reliance Groups being absent from Top 50 (both were in the 425 considered) seems fair popular opinion on “admire” but I had thought that the financial parameters, innovation, product quality, on their own should have brought at least RIL in. That the 291 respondents ranking short-listed companies are in CEO/CXO/VP/GM levels speaks of some “PR” work that companies like Reliance need to do in such peer circles…but then, to be admired is slightly beyond doing PR…that is foundation-building.
13 out of top 50 are from IT/ITES – reflects some natural bias for them in the selection. C’mon, this is a relative ranking – how can all the companies in this space figure so high ? But for a moment, don’t want to take away the credit from TCS, Infy, Wipro, and the MNCs who have adapted well.
Of the 15 industries selected for short-listing final companies (based on size of sector, growth rate, competition), one of the industries was completely absent from the final 50 – banking !!! I can guess easily why banks are not admired companies in India. Given the shoddy customer service, exorbitant charges and in the last decade mis-selling of investment products, who will admire them ? They need to understand that there is more than the short-term P&L that has to be built. Unfortunately, all of them are absent and hence, they will draw solace from that. I was hoping to see HDFC Bank there (ranked 2nd after SBI in banking rankings – rankling for the sector, am sure. Note to myself : do not be frivolous while writing on serious topics).
Power, Telecom, Pharma being represented by one company each – NTPC, Bharti, Glaxo – is also cause for concern with these sectors being the “sun-rise” sector (along with banking / financial services – sheesh !!).
27 out of 50 being “domestic” companies is a bit of a relief – escaped from being crowded out by the skin of the teeth. But easily evident that MNCs, er..global MNCs (I know, I know, Indian companies are also MNCs now) seem to be more admired. Hats off to them for localising and then excelling.
Would love to find out how many top managements are in the process of taking the 9 parameters (or some version of those) as internal metrics, breaking them down into actionables and resolving to rise up the list of admired companies !!! All the very best, champs – it will be hard work, grit, and… character.
On that note, would eagerly wait for next year’s list…and the year after that…to see which companies stay in Top 20/50…ENDURANCE, sirs…men from boys…