S.D. Shibulal, Chief Executive Officer of Infosys Ltd, on the themes preoccupying business leaders at this year’s Annual Meeting in Davos.
The State of the Global Economy
At the beginning of 2013, we are faced with a business environment that is increasingly dynamic. The macroeconomic environment continues to be challenging and currency markets remain volatile. With this backdrop, businesses and business leaders alike are grappling with the need to drive growth, innovation and profitability for their organizations. However, businesses and societies have no choice but to rise above these challenges and move on. They certainly will.
Today we live in a complex, interconnected and interdependent world. The most recent global economic turmoil is not the first of its kind and it will certainly not be the last. The frequency of these challenges of global impact is only bound to increase, given that the consequences of our actions have far-reaching impact today. Changing business cycles are here to stay.
The Need to Focus on the Long Term
As enterprises grapple with these realities and strive to adapt, they will need to conceive and create organizations that are built for the long term. Agility and the speed of response will play critical roles in overcoming short-term challenges while resilience will determine the long-term fortunes of an enterprise. History is witness to the fact that successful corporations are differentiated from the rest in their ability to survive and thrive both in good times and bad. A long term is nothing but a series of short terms. Therefore, as we focus on overcoming the pressing challenges in the short term (the need to regain our growth momentum), we need to have a firm view on the emerging future.
Emerging Global Mega Trends
Today, emerging trends in business, society and demographics present enterprises with new opportunities for growth and innovation. Mega trends like digital consumers, pervasive computing, emerging economies, sustainability, new commerce, healthcare and smarter organizations are changing consumer mindsets and business models alike. Led by technology, enterprises will have to leverage these mega trends to build the enterprises of tomorrow. Therefore, even though the short term seems to be challenging, the long term is full of hope and opportunity. Businesses and societies that demonstrate resilience in the face of crisis will lead the way in imagining and creating a future where opportunities are plenty and growth abundant. As Peter Drucker rightly said, “The best way to predict the future is to create it.”
The Need for Resilient Dynamism and Inclusive Growth
The focus of the World Economic Forum Annual Meeting 2013 – “Resilient Dynamism” – is therefore well timed and much needed. As business leaders from across the world congregate in Davos for this year’s Annual Meeting, our task is cut out for us. We need to focus our collective efforts and wisdom in identifying strategies that will help us build enterprises and societies that are not only dynamic but also resilient to changing business cycles.
The need to find effective solutions to address the prevalent challenges is more critical now than ever before. Today, we live in a world of extremes. On the one hand, we have broken unfathomable frontiers through advances in science, technology and medicine, which have contributed to socio-economic progress. On the other hand, large sections of our population have been left out of the growth story. Abysmal levels of poverty are still harsh realities for millions of people who cannot even dream of an acceptable standard of living. Without doubt, across developed and developing economies alike, growth has not been inclusive. Therefore, as we get together to discuss, debate and shape our shared destiny, we should remind ourselves that we need to include the marginalized sections of society in our vision of the future. We need to bridge the existing developmental gaps because socio-economic disparity is clearly not a sustainable model of growth.
Social Contracts and the Role of Enterprises
The scale of the challenge is so large that no stakeholder can work in isolation and hope to move the needle. What we need is a multistakeholder approach, where every stakeholder across the private and public sectors contributes towards achieving the common purpose – inclusive growth. This is where enterprises play a key role, particularly in the societies in which they operate. Beyond governments, they are the most influential entities that can drive large-scale growth and transformation. They create jobs, they create wealth and they improve the general standard of living. At the same time, enterprises use resources from the ecosystems to drive growth and profitability – be it talent, infrastructure or even natural resources. Therefore, they have an implicit responsibility to fulfil their social contract – to give back to the society from which they take so much. This responsibility is not limited to enterprises alone but extends to each one of us.
Fulfilling our social contract in every role that we play – as individuals and as integral parts of the socio-economic fabric – is the only way we can create a world that is better than, if not as good as, the one we inherited. We owe this to future generations.
Author: S.D. Shibulal is Chief Executive Officer of Infosys Ltd, India and is participating in the World Economic Forum’s Annual Meeting 2013.
Image: A man looks at a screen displaying market indices from around the world REUTERS/Issei Kato