Western companies exhibit a worrying lack of awareness about emerging markets like India that are reshaping global business, according to a British Telecom survey released here July 21. The survey polled 800 directors of large American, British, French and German corporations to gauge the level of their knowledge about the BRICS countries -- Brazil, Russia, India, China and South Africa.
More than five out of 10 executives could not name the currency of India, the rupee; nine did not know that the real is the Brazilian monetary unit and 14% believed vodka, rather than oil, is Russia's main product. "While more than six out of 10 directors... accept that emerging economies will reshape the global business landscape, many seem to have only a rudimentary knowledge of their business environments," said the report.
T.K. Bhaumik, chief executive at Reliance Industries, India's leading conglomerate, said he was shocked by the survey's findings and called it a hangover of the past when Western markets dominated world business. Until 1990, developed economies accounted for 75% of world trade and 85% of foreign direct investment, a trend that is reversing itself as emerging markets come to the fore, he said.
The survey, carried out by market-research firm Datamonitor, found that more than seven out of 10 Western executives believe that organizations in the developed world are better equipped technologically to work internationally than those in BRICS. "This is a troubling finding," Francois Barrault, chief executive of BT Global Services said. "The message hasn't filtered through yet that these nations are already equipped to make an impact on the global stage."
"They have shown remarkable agility and speed at adopting new collaborative tools and technologies quicker, in many cases, than in the U.S. or Europe," Barrault added. "Western organizations need to increase collaboration in and with BRICS businesses or risk being left behind."
India is perceived as the most comfortable BRICS economy in which to do business and Russia the least, the survey found.
Companies with revenues in excess of one billion dollars are currently the most active within the BRICS markets.
"The increasing trend towards globalization has a wider effect on such firms who must look to developing economies to enhance sales, diversify their geographical portfolios and minimize costs through low-cost labor and energy," the report said.
Copyright Agence France-Presse, 2006