Updated on 20 December 2014
Mr Raman P V Rao CEO, RR Consultancy Services, India
Singapore: Multi-national companies or MNC's as they are simply referred to have become extremely powerful in today's world. They play a key role in most parts where they are established with own subsidiary. Healthcare, being the foremost need - after the three basic needs of the human race - has grown leaps and bounds by way of inventions, innovation, expansion, and reach.
This growth can be attributed to many factors like population, global communication and the need itself. However one of the major contributors to the growth of the healthcare sector is the establishment and growth of MNC's.
Large conglomerates have always had some way of representation of their companies & products in Asia among other continents. But it is the medium-sized MNC's who have in the last decade opened offices or hubs in Singapore, Shanghai, and India to showcase their product-lines and expertise and take advantage of the growing economies in emerging markets, like India and China in the region.
Added to this the tech-savvy attitude in India and China has changed the way this huge populace looks at healthcare. And then there is the software industry to both help with their own expertise and skill-sets apart from of course the purchasing power that has increased manifold in the last two decades in these two countries.
However there seems to be a lot of room for improvement in the way the MNC's think and act. Most MNC's still follow the (now) old philosophy "Think Global, Act Local". I would defy this statement at least for India as nothing except the product must be global. Whatever the MNC does it must think ‘local and act local' too. It is always price vs volume. But when it comes to India the volumes are already there! So some fine-tuning or even coarse-tuning of price needs to be done to achieve bigger volumes. This would be my approach to the emerging markets like India and China. The product is welcome as an "imported product". But not the price and service or the strings attached to any services. The Indian population has certainly changed the way they think in terms of quality of service or product. They want the best. But not at the cost of the sky! It must not be mis-construed here the Asian or the Indian public do not wish to pay for quality.
Wrong again! They very much want quality and they do not mind paying too, but not the same price as a westerner pays for the same product. NO! Indians for example do not mind paying a premium for the quality but it cannot be too high compared to the next lower-level one. Strategically speaking why do MNC's come to India & China?...not because of the growing economy alone. It is due to the huge population in these countries, which today can afford a much higher price than in the 1970's or 1980's. But an expensive mistake some MNC's are making is they try to sell their product / service at almost the same price as they do in the western world. With India's population of 1.25 bn, it is only wise that any manufacturer, foreign or local targets the entire population instead of only a section of people. This may not apply to all products depending upon input costs but it certainly can be applied to most categories of products.