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Why so many MNC offices are led by expats in India
November, 17th 2016

The marketing and advertising landscape across the Asia Pacific region (and many other pockets of the world large) is dotted with Indian expatriate talent. But do all of them really want to be there? At least some would rather be back home, even if it means braving traffic jams, being forced to support a 'city team' in cricket or kabbadi, have a working knowledge of the ins and outs of Bigg Boss and an opinion on the latest K-Jo outing. The deal would have been sweetened by the prospect of being country lead of a large MNC, in charge of a brand or ten. The right and just reward for having built some of these from scratch or got them up to speed in what's widely acknowledged as one of the world's toughest markets.

But often Indian professionals with impressive track records and pedigrees find themselves in a strange unfamiliar country, having to prove their mettle all over again. And that at the point when they should, logically speaking, have taken on the largest role within their home country. It's no secret that Japanese and Korean firms typically have bosses from the head office, irrespective of the strength or weakness of local ops. Even some of European firms operate on the same principle. Ferrero Rocher for instance is run by an expat CEO as is L'Oreal, even as it has managed to carve out career paths for its best Indian talent.

This isn't a very publicly articulated grouse - most marketing folk like their jobs and/or need the money to pay for the beach house in Goa or the farmhouse in Kodaikanal. But BE decided to find just why the career paths in some companies end at CXO and seldom CEO for Indian talent. Especially when there's ample evidence of some of the country's biggest companies like Mondelez and Hindustan Unilever, faring very well, helmed by non-expats. Here's what we found:

It has a lot to do with the sector you are in: Technology companies are notoriously particular about expat leadership. LK Gupta, CMO, Cardekho (GirnarSoft Labs) who had a previous stint with LG observes, "The technical know-how is concentrated in the mother company. Be it LG, Samsung, Sony, or most car companies." To the point where according to Gupta, the Indian heads are out of the loop on many aspects of technology, financials and transfer pricing even at the C-suite level. These companies are hierarchical, demand and expect loyalty, with personnel frequently spending their entire careers at the same firm. Gupta says wryly "We Indians are not like that."

Getting to the top is easier in FMCG companies that are marketing focused and easiest of all in the ad industry where expat talent is a significant presence only in Japanese and Korean run agencies.

It's about company and/or country culture: Many companies consider the first few years in a new market particular important from a corporate culture point of view. As Sachin Paranjape, partner, Deloitte Touche Tohmatsu India points out, "Foreign companies want to ensure consistency. If you have an Indian CEO right from Day One, it becomes difficult to control the culture." Instead most companies have a foreign manager till localisation becomes important. Some of them however continue to have an expat head and that goes back to a strong country culture. Marketing consultant Ambi Parameswaran says "At L'Oreal, the board meetings are all in French. There have been enough people who have been successful and non-French but they are very fluent in the language." However according to Mohit James, director HR, L'Oreal India, "At L'Oreal, we value multi-culturalism and diversity of experience in other markets and industries.

So, while we have a Frenchman at the helm in India, we have an Indian in charge of the UK, South Africa, Indonesia etc." 99% of its staff, including senior management in India is Indian.

You can't head a country unless you head out of it: To be truly able to master the curveballs that a market throws at a manager, perhaps the best proving ground is an entirely different market. This may also involve a stint in the head office to experience the country and corporate culture first hand. And the decision on whether one can or cannot take charge, depends on these experiences. Shripad Nadkarni, director - Fingerlix and angel investor recalls that during his stint at Johnson & Johnson, it was not uncommon for people to leave for assignments overseas and return to bigger roles within the country.

Local insights and people may not necessarily deliver every time: India's reputation precedes it as a hard market to "crack." A senior ad man on condition of anonymity says "There used to be this thing about keeping the 'goras' at bay and it happened for too many years." But now, many companies realise that that India along with China - a market with a sizable expat contingent - is too big and important to be left to its own devices. Besides, the famed local insights and cultural cues sometimes get in the way of effective, profitable strategy.

Chawla points to Ferrero Rocher which has an Italian CEO Roberto Grasso: "Since they are selling a premium product, it's perhaps best done by someone who understands chocolate." Ferrero Rocher retails at a hefty Rs 449 for a box of 16 in a market where the most popular price points hover between Rs 10 and Rs 30. A local CEO may have insisted on a product at Rs 20. But as Chawla points out, "A CEO with experience of other markets realises that India has not seen such a product before and has the potential to accept it instead of trying to massify the brand. His belief may be more aligned to the needs of the global head office." Diaper brand Mammy Poko Pants has become a Rs 1,000 crore band in six years under the leadership of Yukihiro Kimura, its managing director. "That's great success and to me personally, it's doubtful whether another CEO could have been more successful than that," he says.

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