Kumar Mangalam Birla Picks Five Trends That Will Have Multi-Year Impact

Billionaire tycoon Kumar Mangalam Birla sees India's "economic might" in the global economy among five broad trends that will have a multi-year impact.

"Some of my beliefs such as sanity over vanity in valuations, the enduring role of large corporations as engines for growth and societal good, and the decisive return to office—WFO over WFH—have stayed true," Birla, chairperson of the Aditya Birla Group, said in a note reflecting on the year gone by.

"On the other hand, my conviction about the roaring 2020s needs stronger confirmation."

He lauded the "collective bounce back" from the pandemic, but underscored the new geopolitical normal that has reshaped supply chains and even redefined fortunes of different countries.

Here are the five broad trends that Birla expects to have a multi-year impact:

Birla termed the next two-and-a-half decades of India's growth an "Amrit Kaal" in the backdrop of "economic might, a large-working age population, demographic dynamism, entrepreneurial energy, robust democracy and diversity".

As reshaping of supply chains continues, global corporations are looking at India as part of China+1 strategy, according to Birla.

"As India further opens up to trade and investment, forms new alliances and reaffirms old ones in the changing world order, it will have a unique place in the global economy," he said.

As India resolves to fulfill 50% of energy needs through renewable sources by 2030, India Inc. is following suit through investments in green energy, the circular economy and sustainable materials.

"The pendulum of climate change will swing globally when we can find technology-led solutions to marry the material aspirations of current generations with responsibility towards the lives of future generations," Birla said.

"And nowhere is that truer than in rapidly-emerging countries like India."

Birla said there is much to learn from the raw energy and hustle of many of these new ventures in the start-up ecosystem.

"At the same time, it’s also increasingly clear that there is a thin line between hustle and hubris," he said.

Birla suggests four rules of building a successful business:

• Building great teams as it can harness the best solutions available.

• Creating a culture of values that are built for the long haul.

• Own the offensive moves

• Value to investing in building a view to core metrics—operating profits, gross margins and cash flows.

As business cycles become shorter, Birla said the group faces a challenge to harness the trust and stability that comes from longevity and ensuring continuous reinvention.

"What are the bets that see through the short-term fads and translate into sustainable advantage? I do not have the answers to all these questions, but take heart in some of the unique experiments that we have underway to find solutions."

Birla said the group would enhance its absorption of talent, technology and capital.

This will enable the group to "increase its ability to give back, create impact and enrich lives. This virtuous cycle is at the heart of being a successful purpose-driven organisation".