Harsh Mariwala’s Vision: Scaling Indian Startups Through Innovation and Mentorship

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We are going to talk about your work in entrepreneurship and fostering entrepreneurship. And I'm going to come to that in a little while. But before that, tell me, why did you even think of this? I mean, you've been running Marico for some time. At that point, when you decided to start this. So, arguably, Marico itself had a way to go, as it has gone subsequently. So, why did you decide on this twin path?

I always thought that as organisations, we need to give something back to the society. And at that time, there was no compulsion of giving 2% of revenues for CSR. But we started our journey much earlier, because we were convinced that as organisations, we have to look at all the stakeholders, including society, the shareholders, of course, the customers, employees, associates. So, I think the belief started from our purpose, which is to make a difference to all the stakeholders.

And then we said that in our own journey, innovation has played a very important role. And whenever we have seen that innovation succeeding, not to say that all the innovations have succeeded, many of them have failed, which is perfectly all right, because innovations have to fail. If they don't fail, that means you're not taking enough risks.

So, whenever we've seen the success of an innovation for our own brand, or whatever discontinuous impact on our growth, and it happened multiple times. So, my belief in being innovative went on during strengthen. We started working on creating an innovative culture.

How can a company become innovative from a cultural point of view in terms of risk taking, prototyping, experimenting, removing the fear of failure, having good quality talent, applied structure, openness, trust, things like that. But in addition to that, we said that we realised that innovation was not, at that time, 20 years back, was not getting that much of attention as it should be getting. It was not on the list of most CEOs at that time.

Today, if you ask, innovation is virtually there in each and every CEO's list in terms of top priority. But at that time, it was not getting that much traction. And we said that innovation is very crucial for India to succeed, both in terms of its business success as well as from a society point of view.

So, social innovations, business innovations are both critical. And if India is to leapfrog into higher growth rates, I think innovation is very crucial. And some of the challenges we are facing, and we've seen that what happened with mobile, all of a sudden, it changed the whole world.

Can the same thing be done to other sectors like education, like healthcare? And with so much digital happening, clearly, there are opportunities in Agri also to innovate and take a big, big jump in terms of our overall effectiveness in these areas.

So, I think we started with a strong belief that we need to get traction in corporate circles, in social circles, the need to innovate. And with that belief, we just started. I didn't know anything. At that time, it was just more a desire to create awareness about innovation.

So, we did firstly, when we started off, we did a study on innovation, state of innovation in India, which are the innovative organisations. And then we started teaching innovation in management schools at that time.

And then the book on innovation came out, which became a bestseller. Then the awards came in, which are going to be happening on the 6th of March this year at Jio Convention Centre. And we do those awards once in two years.

So, and then after that, we've done many other things, like we've done studies on innovative organisations in plastics. We've done, we do scaling up where at a time we are working with 15 to 20 organisations, helping them scale up because we realised that many organisations were innovative, but they didn't know how to scale up. So, innovations, not being scaled up is an opportunity missed.

Got it. So, I'm going to take you back to Marico for a brief while. So, you talked about discontinuous growth and how innovation can change the trajectory, so to speak. So, tell us about what were the one or two examples in Marico that made you sit up and say, oh, this is what innovation can truly do. I'm guessing it must be to do with Parachute or Saffola.

Both, you're absolutely right. It is true. It's our two main brands, let me put it that way.

In parachute, when we innovated a long, long time back, I'm talking of 30, 40 years back now, the whole market for coconut oil was in tins. And we saw an opportunity of converting that market from tin to plastics because plastics is cheaper than tins. It's relatively more attractive.

It's more convenient to use. And we thought we had it in our own hands. But when we went to the trade, we do a lot of insighting.

So, when to the consumer, they all love that idea. Went to the trade, it was rejected because apparently, prior to us, many years back, before we were to launch plastics, somebody else had launched coconut oil plastics. And that was a disaster because it was a square shaped bottle, oil on the outer surface of the bottle.

When the retailer closed the shop in the evening and opened next morning, all the rats had bitten away the coconut oil. And then we said that, what do we do? There is a great opportunity, but we need to crack this because unless retailers buy it, you'll never, those days there was no e-commerce.

There was no direct way of reaching the customer. So, then we designed a round shaped bottle, ensured that there was no coconut oil on the outer surface of the bottle, put them in rat cages. And that's how we got convinced nothing happened to the bottles.

And then we went very aggressive. We took pictures of that, gave it to our field force and monthly targets. And it was a matter of time, took five years for us to convert the market from tins to plastics.

But I think that because of this conversion, we went on putting in more money in advertising, whatever you're saving and give a lower pricing also compared to tin. So, our market share just jumped up from 15% to 50%. And it's a large category, which is used by all ages, you know.

So, I mean, we've seen a huge impact. And I think that is the same set of innovations. And I'm just giving one example. Coconut oil freezes in winter. So, a lot of people would shift back to tins. And we came out with a wide mouth plastic bottle.

So, that got done. We were having a lot of duplicates, lookalikes for our brand. And we came up with innovation, which was an innovation in a mould, which is a combination of pilfer proof and flip top cap. So, that again played a role.

A few years later, we realised that the whole market in Bangladesh, which is a very large market, is in tins. So, we said, why don't we do the same thing that we did in India?

And we went very aggressive. Within a much shorter time, we converged with the whole market there against local players. And we have an 80% market share.

So, it's done wonders for the brand. But now, when I speak about this innovation, a lot of questions come up, especially at events where, what are you doing for the environment, you know? Because plastic causes harm, which all of us agree.

We don't have a simple answer because going back to tins is one option, but it is far more expensive. People will not go back to tins. So, then the innovation team came to us saying that, okay, can we do a study on innovation in plastics to reduce plastics usage, to replace plastics usage?

And to ensure that it's reused, you know. So, 15 organisations were identified as a part of the study in different parts of replacing, reducing plastic and we said, okay, how do we make it far more effective?

So, we started working with each organisation in terms of helping them scale up. But that was not enough because the landfills which are there, we needed a large number of initiatives to impact that. So, now we have signed up with a company based in Hyderabad, which does a lot of recycling.

The name of the company is ReSustainability. And now we are in the process of putting our project in Hyderabad and then Raipur to ensure that plastic gets recycled. And this is a state-of-the-art recycling plant, which is far different and far better than what other recyclers are doing in other cities.

It segregates at a very high speed, AI enabled, different brands of plastics. And we see that there's a good payback also. If that is successful, that prototype, we can actually extend that prototype all over India.

It requires large investments, I must say. But I think the problem is huge. And there is enough and more of us, apart from corporates, from the government, the municipal corporations.

So, we see that if that is successful, and we are quite sure that it will be successful, we can roll it up in all India and to some extent, play an important role in reducing landfills and the environment damage caused by the plastics.

But, and you're saying that this is really a packaging innovation rather than a product innovation.

It is a packaging innovation.

Or the product innovation may have been the weather, I mean, the cooling part of it or the freezing part of it. Yeah, it's a packaging innovation.

But for a category like coconut oil. Which is, I mean, 30-40% of our turnover comes out of coconut oil, 30%, you know. So, it's, it's big.

And it's... But you're, at that time, you were trying to save costs first or make the process of manufacture, packaging and distribution easier?

No, no, it was basically, it is, ultimately, it was viewed from a consumer angle. Okay. That consumer finds it far more attractive, far more convenient to use.

And of course, it is less costly. So, that also appeals to the consumer. So, I think ultimately, for innovation to succeed, you have to have consumer inciting and based on consumer preferences.

And I'll talk of one more innovation, which is in foods. So, we launched Saffola plain oats. Saffola stands good for health, good for heart.

And oats is good to have. But when we launched, we got some market share because of the brand, because of distribution. But to fight against the bigger players, like Kellogg's, Quaker, it was not enough.

I mean, we were stuck at over 10, 15% market share. So, we did some consumer inciting and identified that Indians like savoury breakfast. And then we saw what, what Maggie did to the noodles category in terms of savoury noodles and masala noodles and what not.

So, we said, can we launch a range of savoury oats? So, now we have launched last four or five years back. In South, you would have pongal oats, masala oats, veggie twist and things like that. And that has created a completely new market for oats. And it's a 400 crore category we have created. We have an 80% market share in that category.

And because of that, our market share in oats also has jumped up. And I think we are close to becoming market leader if you combine both plain and savoury oats. So, again, based on consumer inciting and developing a product, which is relevant to consumer, made a big, big difference in creating a new category and helping our plain oats also to increase market share.

So, in this case, it also tells me, because obviously you've been around, that this is continuous innovation. It has to be. I think it's a matter of time others will copy you. You have to be two steps ahead of your competition. So, people have obviously copied you.

Of course, they have copied me. But if you are a pioneer in something, then, you know, if you maintain and if you actually promote your brand and do it in the right way, it'll be difficult for others to dislodge, unless they have something superior compared to you. And I think masala oats also, others have started. But we have been able to retain our market shares.

And even in coconut oil also, we've been able to maintain that market share, which we had achieved because of the plastics launch.

So, what have others tried in coconut oil, which you feel has been interesting, but maybe not big enough to dislodge you?

No, I can't single out anything else which is differentiated. So, because the category itself has limited potential for differentiation. If you have value added categories like shampoos or hair oils or something else, then there would be opportunities for innovation. But in pure coconut oil, there are opportunities for innovation, we already tackled all the issues in terms of clear coconut oil, in terms of smell. One new category of coconut oil, which has opened up in the recent past is organic coconut oil, where also we have entered cold press oil.

And so, what is the challenge there? It's not a packaging challenge so much, I'm assuming, as a market creation.

It's a market, it's not a very large market, but the awareness is increasing that need to have cold press oil. So, I think it's the whole challenge is how do you stand out as a brand there? There is a lot of competition and there our market share is not as high as parachute coconut oil.

So, between creating or having an innovation ecosystem and environment within a company, versus, let's say, working with smaller organisations who are starting out outside, what are the differences that you've seen in these last two decades or so that you've been on this?

See, the biggest differentiation I've seen is that, the usage of technology. Technology has played a very, very critical role in driving innovations. Technology and discontinuity, I would say, both these. So, I think many of the innovations we are dealing with are dealing with either discontinuity or digital disruptions or technology. And I think that is the biggest disruption we've seen in the last 10 years or so. And the other thing is many innovators are doing this, but they don't have a business maker on.

So, these are small organisations led by some technocrats or some innovative individuals, but they don't know how to scale up. They do innovation and then they're stuck there because they don't have overall business mindset in terms of marketing, finance, whatever is required for you to succeed in the marketplace, you know. And I think that's where we see ourselves playing a very important role because we identify these organisations.

We also invite these organisations to apply to us if they want to be scaled up. Of course, we will go through our own rigorous way of evaluating whether these are innovative organisations, whether can we add value to them. And I think anybody can apply if they go to our website of Marico Innovation Foundation.

If they're innovative, we would evaluate that. We also work, we have an internal team but we work with Marico talent because Marico talent would want to give something back to the society. So, it's a very good way at an individual level to identify those who want to give something back.

So, many Marico managers are involved in helping these organisations scale up. We also go to campuses and we run a very popular programme for the summer training. We give them three different organisations and their challenges and many of them have to go rural and many of them are social organisations which are innovative.

And we have competition, we give them awards and that has improved our equity in the campuses substantially because these are very innovative challenges which the students get to work on. In addition to that, we also are working with about 20-30 CEOs who have retired and who have an inclination to give something back to the society. So, I think all that combination plays an important role in creating business opportunities for innovative organisations.

And we've seen that, I myself have got involved with some organisations which have become Sunicons from virtually zero base organisations like Attenberg, S4S Technologies which is in solar drying of vegetables and fruits. So, I think all in all, it's very heartening and enriching. This whole adding value to innovative organisation is something I enjoy doing it.

We play a catalytic role but I think it has tremendous benefits to the organisation.

And the underlying theme as I'm interpreting from all that you're saying is really solving problems or challenges that are facing or right sort of, you know, something that is right in our face in this country. Absolutely. In our many markets including agriculture. So, you're not looking for some grand, you know, launcher rocket to the moon kind of thing but you're looking...

I mean, some of the winners we've seen it, they've had drones. If they require help, we of course there to help. Some of them are in some space technology but the whole objective is to help innovative organisations get attention, awareness, some support because our awards now are recognised and our event also is very well attended.

Almost thousand people come in and very good quality crowd. So, it has got that traction in terms of if you are a winner of Marico Innovation Foundation Award, you can get, hopefully you can get more funds, you can get any other help, it improves your image. So, I think all in all, it plays an important role and this year we also have for the award winners, I can't share the names at this stage but we have worked out a package wherein they will get some traction in terms of media, they will get mentored, the scalar programme would be there.

So, there are a whole host of other benefits they will get. We don't give funds to them by design because I think many people are giving funds but we add a lot of value by doing other things which I think which is very, very crucial to their journey.

So, let me bring you to the marketplace today including the pure marketplace which is for consumer products. So, we are in a situation let's say where we've seen the markets diverge in a way. So, there's been premiumisation, there is the lower end has slowed down in the last couple of years. What does this mean and what is the opportunity here? I mean, for people who want to pitch to you today and say I want to innovate, what would you tell them to do? How would you suggest this particular?

The biggest disruption happening in our sector is the emergence of D2C brands because...

That's a distribution solution.

Not necessarily distribution, both distribution and marketing because what used to happen in the earlier days, 10 years back, most defensive sector, very high valuations, very difficult for a national player to disrupt because of big budgets required in advertising, good distribution network required and now with the emergence of e-commerce, quick commerce as well as a digital marketing, you don't need that kind of money. So, we've seen something like 500 brands coming in and disrupting not necessarily the FMC sector but other sectors also and this could be a threat to you, it could be an opportunity. So, from Marico, we have viewed it from an opportunity.

And you've acquired some of these companies.

We've acquired four brands and they will do a turnover maybe hopefully next year 2000 crores or so. So, we have looked at from an opportunity point of view. I think very other, very few other FMCG companies have been as aggressive in acquiring D2C brands as we have been.

But coming back to your question about what is happening in the business. So, I think you have to look at the environment is such that we've seen very low growth rates. If you look at last quarter's results, most companies have single digit, low single digit growth rates.

We've had double digit, I think 14% growth rate or something, which is I think the food has played an important role because we launched food as a new vehicle to growth. So, you have to look at growing. Growth is very important for any organisation.

Of course, the environment plays a role. But even if the environment is not good, you have to find new growth avenues, you know. And we have done it through entertained foods and D2C brands.

But the environment is not as good as you rightly put it. There is a lot of stress, especially in the middle and lower-income groups, partly because of inflation, partly because of income contraction. So, there is a real issue there.

And I mean, you can say that you need to add capacity, you make investments. My view part is that, you know, if there is a demand increases and there is a higher capacity relation, no entrepreneur is not going to invest more. You're not going to invest just for the sake of investing, but provided there is demand, of course, you will invest, you know.

So, I think the key thing is to increase demand. The government has taken a step in terms of providing some income tax relief, but that's more of the middle and upper middle levels, you know, not at the lower middle and lower levels, but the problem exists today.

And if you were to go back, I mean, I'm sure you've seen these cycles before.

We've seen that cycle, but this is, I mean, this is a little bit unexpected in terms of why this has occurred. Because at one level, India's macros are in good shape in terms of fiscal deficit and things like that. But still, inflation is relatively, it's not very high. It's under, it's not so bad.

Food inflation has been high, but overall inflation has been low.

But this little, I don't know, puzzling, one doesn't know whether, I mean, the impact on some people blame GST, some people blame, still blame the demonetisation. I don't know. I'm not able to put, I'm not an economist, but I don't know what has resulted in this.

But at the upper end, as you rightly put it, you know, whether it's real estate or cars and, you know, cars have again worn down. It has been a great journey.

So, what is the role of innovation at a time like this? When, let's say, you're trying to find new markets or differentiated approach to the same markets. And more importantly, you want people to spend something or spend more on a certain category despite their incomes being limited.

So, let's say they're spending more on education today, which they are, because they feel the need to. Maybe they're spending more on healthcare, defensive or responsive, because they have no choice. So, those are eating up more and more of their income.

But now you're saying, okay, I want you to spend on this, maybe shaving products or maybe, let's say, more oil or oats. So, how do you, how do you address that challenge? I mean, what would an innovator do?

Continuously innovate in terms of consumer insighting, depending on the sector you are in. Can you do something which is far differentiated, where there'll be traction for consumers to buy that product? I mean, look at what has Zudio done in garments, you know.

So, offering products at a relatively lower price point, attractive products. So, there could be opportunity, there could always be opportunities to innovate, you know. Some of the initiatives undertaken in terms of acquiring not very popular brands, but known brands and offering at a deep discount.

They've been able to increase market size for sure now. They have capacity to at least bleed for some time until they increase the market size, you know. So, I think you will have to be a little disruptive if you ask me whether it's pricing or whether it's a product or whether consumer insighting, if you really want to grow and beat this so-called downturn.

Now, the other question which people used to ask you maybe 15-20 years ago was, how do you perceive multinationals? Because there was a sense that, you know. Now, I don't, maybe that question is not so relevant today, but I feel it's still interesting to ask that.

And, you know, as a standalone company brand who's not really partnered with anyone else. How do things look today?

So, I think from the point of view within the marketplace, I think we don't feel at some stage, maybe I'm talking of 15-20 years back when we didn't have the right distribution network, we didn't have the right level of competencies in terms of marketing or in product development. Today, we don't feel inferior because I think the technology required in many cases, of course, they have a global scale, so they will be able to invest much more. But I think it's not a key differentiator in FMCG.

So, we believe that we are at one level, we are level playing field. Now, it all depends on which category you want to get into. You know, in some categories, if they already are market leaders, it will be difficult to disrupt unless you have something innovative.

But at an organisational level, I think whether it's quality of talent or technology or marketing and distribution, we may be slightly, compared to a large chat, likely words may be little often, but otherwise, we don't feel that we are far inferior to them. And to that extent, we can take them on if we have the right product.

Yeah. No, and I guess you have. So, the question is this. So, at some point of time, you must have realised, and this is a while ago, that, okay, we have if we have the ideas, then we can take on the goliaths of this space. So, when was that point? I'm just curious.

No, I think from day one, when we started the business many, many years back, first, we identified areas where we have a strong right to it, where they were not concentrating on certain sectors, because it was too small, or it was not a part of their global portfolio of products. And I think that provided us great opportunity to occupy that spaces and not only occupy the spaces, but becoming a market leader.

So, if you look at Marico's portfolio of products, virtually in each and every brand and product we are in, we are market leaders, because we chose the right categories. But now that we are a market leader, where does growth come from? So, now we went into some categories where MNCs are far more, shall I say, stronger. So, whether it's baby or shampoo or skincare, we now have to have some differentiator.

So, our differentiator in many cases is Parachute and coconut equity. So, coconut is strongly associated with Parachute and we have the highest right to win in that category, if it makes a difference to the customer.

And coconut is a superfood and it can be leveraged. It has very good, I would say, emotional bonding with all the Indian households because it's an auspicious fruit and you use it for when you get married or when you enter the house and things like that. So, we're trying to do that.

So, I'm going to come to the innovation and the innovators in a moment, but this is for people who may not know. How did that name parachute come in? It seems like such an unusual name for coconut oil.

Yes, when I joined the family organisation, it was already there, the brand. And it was mainly sold in the big tins, that is 15-litre tins. And the retailer at that time, they would dispense it to the consumer in loose form, you know, the consumer would carry their own bottle and get it loose.

We converted the market from unbranded big tins to small packs. And I never, I continued that brand, you know, a lot of people that told me that, please change the brand name, but I don't know why, but it was getting good traction and I never felt like changing. And, you know, because that would again put us back by sometime, you know, for a finalised brand name, packaging, everything designed.

So, it was just, I would say intuition. I don't know why, but it just happened. The name came, original name came from the world war days. When the big tins in, I think, second world war, Parachute was used, it was new. When, you know, from the planes, people would drop down Parachute and that's how. So they would drop oil?

In the war, people would come down through the parachute. And I think one of my uncles must have thought it's worth having that brand name. So then the same uncle was telling me, you know, you've changed the brand name in small packs, but luckily we didn't change it. I don't think there is any negative.

No, no, not at all. So let me come to those companies that you've supported through the foundation.

And there are some 70 companies or ventures. Yes. Now tell me about, let's say if you were to pick three or four, as you look back, what's really stood out for you and whichever way you define success and that you in a way feel epitomises, symptomises what is India's strength and can therefore be an example or should be an example for others to look at.

So I can think of three organisations. If there's one common thread amongst all these three organisations is they have leveraged technology. So the first one is Atomberg Technologies, which leverages technology to reduce the power consumption in fans. When they came, they were doing very small turnover. And then we we worked with them and then it's become a sonycon now. I think must be doing a turnover of, I don't know exactly, but three, four hundred crores or more than that.

Then the second organisation I can think of is S4S Technology. They came out with their innovative way to dry fruits and vegetables. Then they came to us and they said that we want to launch our own brands of dried, like sun-dried tomatoes and all that. And my being in branded products, we said that don't do that. It's very difficult to. And that time there was no, I'm talking of five, seven years back, the emergence of e-commerce and was not there, just started.

So I said, why don't you look at institutional sales? And at that time we saw an emergence of so many QSR chains. So why don't you work with them, whether it's McDonald's or KFC or something and provide them products. So they started doing that and they saw very good traction in that. And they had immediate sales. They didn't have to make their own brand or distribute. And I think that has been quite successful and they've been able to scale up and they've, they become a swinicorn.

The third organisation talk of is Ishitwa, which was identified as a part of our research on plastics. And the research was done by Indian Institute of Science, Bangalore and Praxis Consulting. And they identified, as I mentioned, 15 organisations which were doing research. And we realised that, again, leveraging technology very high-speed recycling machines, AI enabled, which would segregate different types of plastics brand wise. And I think that's very important because FMCG brands, if I am able to get the same brand through recycling route, the same product through, then I can reuse them properly and I can have a circular kind of economy and make a claim about that. And that's what we are going to use most likely in the Hyderabad project, which I talked about earlier. Again, very high-tech machines, very high speed. And we are quite bullish about that organisation also.

So when you meet some of these entrepreneurs in the process of selection, do you look for qualities in them which are like yours or totally different?

No, I think at that time they are to be innovative because innovation is the key driver for us to identify. Even if they don't have entrepreneurial qualities, that's where we can make a difference. So our job is to make them entrepreneurial, make them think from a business point of view. If they're not in business, then from a social point of view, how can they scale up?

So it's not necessarily entrepreneurial. We would look at innovations which have potential to grow and which have been under-leveraged and they don't know how to make it happen.

What about the soft qualities? I think that's also important. So how do you attract talent?

How do you retain talent? So I think we go all the way, everything, not necessarily technology or not necessarily functional area, but softer side of attracting talent, retaining talent, leadership issues, because these are very crucial for any entrepreneur to succeed. But they need not have that when we have identified the innovation.

I think the innovation should, the whole objective is it is innovative, that's the most important thing. It should have potential to grow and that's where we come in, that we will exploit and help them grow. But without anything in return, I mean, we don't charge them anything.

And where have you seen an example, one or more, where you've seen someone take an approach to a situation or a market which is very different from how you would have done it and goes against your own instinct?

I can't think of anything which is...

So you're saying there's a convergence at all times between...

Yeah, I mean, it's the route which like I talked to you about as far as we change the completely in terms of how to think business in terms of B2B business. And so I think that really played an important role.

And what do these companies over time, what have they taught you? I can see the benefit, but I'm saying, would you say...

I think the exposure itself, it just teaches us, you know, how to scale up. And I think more than that, it gives us tremendous satisfaction, not only to me personally, but to the team as well as to Marico people. And I think we are playing our role in terms of making a difference to them.

But each business is different. So I'm not able to capture that teaching, but I think it's quite exciting. And maybe some of them could be leveraged for our own core business also.

But how do you innovate is the biggest, shall I say, learning. How do you leverage technology is very, crucial.

So last question. So if you were to lay out two or three key challenges that we as a country need to fix, in the context of businesses solving it, I'm not talking about political or other businesses, business challenges to be solved by entrepreneurs and innovators. How would you list the top two or three?

So I think, first of all, I must say that before I answer your question, the whole environment has changed in the last many years and I think so happy that so many new entrepreneurs are entering businesses and coming in from small towns, coming from non-business families. And the whole ecosystem is not fully developed, but going towards creating more and more entrepreneurship. And I think the only way India can become a fighter in the economy is through entrepreneurs.

The government, of course, has a role to play, but ultimately entrepreneurs have to take the bait in their hands and make it happen. And I think that's where we need to identify disruptions, what's happening in the environment globally, even including supply chain disruptions, political changes. These are all opportunities for growth, technological disruptions.

To me, disruptions is the biggest opportunities for growth and disruption can be a threat. But can we look at disruption more from an opportunity stay angle? To me, that's the biggest.

Of course, the ecosystem has to develop. We need to have good talent. We need to know how to leverage the technology.

We need to have the outside in terms of what is happening in terms of global trends, global technology, how quickly can it come in? How can we use more and more of AI at every level in an organisation? But this is one gap.

It takes some time. There's a translational loss between the time it's developed in a country to actually bringing it here. And the biggest gap I've seen, it is a medium and small scale organisation where they don't know how to go digital.

They don't know how to leverage technology. If you ask me, that's a big, big gap. And you know, if organisations or consultants are helping them achieve that because they don't know how to, I mean, digital there is completely black box for them.

How at an organisational level can you prioritise what you want to digitise? It will differ with the kind of business you are in. So, you need to prioritise that and then have a roadmap of digitisation, which removes some of the escape buttons and has full time attention because it has huge impact.

You cannot digitise. No organisation can afford not to be digitised. But I think many organisations don't know, especially at medium, small scale organisation.

They don't know how to digitise. So, I think these are some of my thoughts.

Since you've talked about disruption, let me pose a supplementary question. So, a big disruption or perhaps the biggest right now that we're looking at is obviously geopolitics and tariffs.

So, you are a global company, you are in Bangladesh, and that's gone through one round of disruptions. I'm not going to quiz you on that, but I think that's something that you may want to use in your answer. But when tariffs go up, it is a disruption because it affects a lot of companies, particularly exporting companies, it could affect your supply chain. So, how does, could that be an opportunity? If so, how?

For us, it may not be because, you know, I think most of the companies where we are big presence, we have our own manufacturing there. We have our own supply chain. So, it's locally manufactured.

We are total international business firms, about 27% of our turnover. I don't have exact figure, but 25 out of 27 is, or 23 or 25, that is where we have our own factories and we don't export from India. So, the tariffs are not likely to impact us, and I don't even know what are the tariffs, but even if the tariffs go up in the US, impact on us will be very little.

But if you were, I mean, my question is also hypothetical. If you were, let's say exporting, suppose you were a government exporter, and the US was a big market, how would you look at it? I think there will be multiple things.

One is how do you tackle it? How do you tackle the US market? Can you improve your cost structure? Can you do something innovative, which will get traction at a higher price point? Another is, because a lot of countries will get affected, the competition will increase in non-US markets. So, in Europe and other markets where people will be far more aggressive, China and others. So, that's another challenge this organisation will have to face.

Mr. Mariwala, thank you so much for joining us.

Thank you, Govind. Thank you so much. Always a pleasure.