Understanding Organizations and Business Ecosystems in India Using Business Systems Framework

Abstract

This chapter presents Indian business ecosystem using business system framework. It also discusses how Indian business system has evolved over time. India presents a unique challenge, given that the state institutions have not evolved organically from traditional social institutions. State institutions, which were imposed during colonial period (and that thinking has persisted in the post-independence period), are guided by Anglo-Saxon rationality. On the other hand, socio-cultural institutions, which have evolved over time, are guided by traditional rationality. There seems to be a significant disconnect between socio-cultural institutions and state institutions. Disconnect between socio-cultural (background institutions) and formal state institutions (proximate institutions) poses a huge challenge for business organizations operating in India, especially the multinationals from abroad. Besides, the chapter identifies potential avenues for academic research using business system framework as a unit of analysis. It also presents key takeaways for organizational leaders to be effective in Indian organizational and business context.