Informed i’s Weekly Business Insights

Big family companies play a strikingly large role in Indian commerce. Its ten most valuable family-business groups are worth nearly $900bn. The top 100 are worth $1.4trn. First-generation groups account for just a fifth of that. According to a study co-authored by Kavil Ramachandran of the Indian School of Business, nine-tenths of India’s listed firms are family-controlled, far higher than in the West. Few corporate giants in America are controlled by families; there is no Gates at Microsoft, nor a Jobs at Apple.

In India the outsize role of families changes the character of commerce. Succession feuds such as the one between Mr Ambani and his brother are common, and often lead to conglomerates being split into multiple businesses. Corporate empires intermingle through marriages. Foreign companies such as Disney, a media giant, have realised that doing business in the country is easier with the help of a well-connected family.

Dominance of India’s economy by a few families is an outcome its post-independence government overtly sought to avoid. Various laws passed between 1947 and 1969 sought to curtail the growth of large companies. Many firms were nationalised and various industries, such as mining and telecoms, were reserved for the state.

In practice, the vast regulatory burden of doing business in the country continued to benefit large family enterprises with strong connections—an advantage that persists today. In a country with weak institutions, these firms are better placed to attract capital, negotiate with workers and sway government policy in their favour. A focus on leaving a legacy may also encourage family-run businesses to invest more in their long-term success. It helps that, unlike many rich countries, India has not imposed an inheritance tax since 1985, making it easier to maintain family control across generations.

There are signs, however, that change is underway, and not just at Reliance. There are very few Tatas left at Tata, another conglomerate. The last member of the family to run it, Ratan Tata, stepped down in 2012 (albeit with a brief cameo in 2016). When Anand Mahindra retired in 2020 as head of the Mahindra Group, yet another Indian conglomerate, he handed the reins to an employee. So did Harsh Mariwala when in 2014 he stepped down as the boss of Marico, a family firm he had grown into a consumer-products giant.

In time, the growing dynamism of India’s economy may further loosen the grip of corporate dynasties. New-business registrations have picked up as the process has become simpler. Despite a recent slump in venture-capital investment, India has a vibrant tech scene full of entrepreneurs eager to disrupt stodgy incumbents.  But change will be slow.

In 2016, the author attended a large meeting of journalists in Washington, DC. The keynote speaker was Jennifer Doudna, who just a few years before had co-invented CRISPR, a revolutionary method of changing genes that was sweeping across biology labs because it was so easy to use. With its discovery, Doudna explained, humanity had achieved the ability to change its own fundamental molecular nature. And that capability came with both possibility and danger. One of her biggest fears, she said, was “waking up one morning and reading about the first CRISPR baby”—a child with deliberately altered genes baked in from the start.  

Gene editing had become the biggest subject on the biotech beat, and once a team in China had altered the DNA of a monkey to introduce customized mutations, it seemed obvious that further envelope-pushing wasn’t far off. 

If anyone did create an edited baby, it would raise moral and ethical issues, among the profoundest of which, Doudna had told the author, was that doing so would be “changing human evolution.” Any gene alterations made to an embryo that successfully developed into a baby would get passed on to any children of its own, via what’s known as the germline. What kind of scientist would be bold enough to try that? 

According to the author two years and nearly 8,000 miles in an airplane seat later, he found the answer. At a hotel in Guangzhou, China, he joined a documentary film crew for a meeting with a biophysicist named He Jiankui, who appeared with a retinue of advisors. During the meeting, He was immensely gregarious and spoke excitedly about his research on embryos of mice, monkeys, and humans, and about his eventual plans to improve human health by adding beneficial genes to people’s bodies from birth. Still imagining that such a step must lie at least some way off, the author asked if the technology was truly ready for such an undertaking.  “Ready,” He said. Then, after a laden pause: “Almost ready.”  Four weeks later, the author learned that he’d already done it.

For his actions, He was later sentenced to three years in prison, and his scientific practices were roundly excoriated. The edits he made, on what proved to be twin girls (and a third baby, revealed later), had in fact been carelessly imposed, almost in an out-of-control fashion, according to his own data. 

Editing human embryos is restricted in much of the world—and making an edited baby is flatly illegal in most countries surveyed by legal scholars. But advancing technology could render the embryo issue moot. New ways of adding CRISPR to the bodies of people already born—children and adults—could let them easily receive changes as well. Indeed, if you are curious what the human genome could look like in 125 years, it’s possible that many people will be the beneficiaries of multiple rare, but useful, gene mutations currently found in only small segments of the population. These could protect us against common diseases and infections, but eventually they could also yield frank improvements in other traits, such as height, metabolism, or even cognition. These changes would not be passed on genetically to people’s offspring, but if they were widely distributed, they too would become a form of human-directed self-evolution—easily as big a deal as the emergence of computer intelligence or the engineering of the physical world around us.

The author was surprised to learn that even as He’s critics take issue with his methods, they see the basic stratagem as inevitable.  When the author asked Urnov, who helped coin the term “genome editing” in 2005, what the human genome could be like in, say, a century, he readily agreed that improvements using superpower genes will probably be widely introduced into adults—and embryos—as the technology to do so improves. But he warned that he doesn’t necessarily trust humanity to do things the right way.  Some groups will probably obtain the health benefits before others. And commercial interests could eventually take the trend in unhelpful directions—much as algorithms keep his students’ noses pasted, unnaturally, to the screens of their mobile phones.

In the world of Bloomberg Businessweek’s rankings of the best business schools, some things don’t seem to change. For the 2024-25 edition, Stanford University once again holds down the top spot among full-time MBA programs at US schools, as it has for the past five years. The Palo Alto-based university maintains strong scores in four of the five areas we index — Compensation, Learning, Networking and Entrepreneurship. Beyond Stanford, the basic shape of the top end of the list has held fairly steady, with a few exceptions.  Booth, Kellog, Tuck and Darden occupies rest of 4 slots respectively.

The US and Canada saw schools experience growth in the number of applications between 2022 and 2023, according to the Graduate Management Admission Council, while in Europe, Asia and the Pacific Islands, programs saw applications drop.

Consulting, Financial, Technology, Healthcare, and Consumer are the top hires for MBAs.

In 2023, global beauty market retail sales grew to $446 billion, up 10 percent from 2022.  In the year since the release of McKinsey inaugural state of beauty report, published in collaboration with The Business of Fashion in May 2023, the industry—comprising fragrance, makeup, skin care, and hair care—beat expectations and outperformed other consumer sectors, such as apparel.

The beauty market’s 10 percent growth in 2023 exceeded industry forecasts across nearly all regions.  The Asia–Pacific region, excluding China and Australia, remained the largest region by retail sales in 2023, growing at a 10 percent rate over the previous year. India, which also grew at a 10 percent rate year over year, was a bright spot in the region (with 4 percent volume growth and 6 percent price growth). 

In North America, which today accounts for 20 percent of the overall beauty market, retail sales grew by 9 percent year over year. Europe, another mature beauty market, grew 10 percent from 2022 to 2023. Growth in the Middle East and Africa region and Latin America reached 18 percent and 17 percent, respectively, year over year, both exceeding industry expectations.  These strong headline figures do not tell the whole story, though.

By 2028, the authors expect the beauty sector to reach $590 billion, with an annual growth rate of 6 percent. In mature markets, such as the United States and Europe, the researchers estimate that both price and volume growth will be in the low single digits.  Among the regions, the highest annual growth rate is expected from the Middle East and Africa (10 percent) over the next four years. Price mix increases will most likely outpace volume growth here more than anywhere else in the world, as consumers continue to demand premium products.

Skin care—the sector’s largest category, accounting for 44 percent of the market—grew 6 percent in 2023, in line with projections.  Despite being the smallest category in beauty, representing just 17 percent of the market, fragrance posted the highest growth (14 percent) in 2023. The category is likely to continue exhibiting strong growth, especially in the Asia–Pacific region, where it currently represents around 5 percent of the total market (compared with 17 percent in North America and 27 percent in Europe).

In 2023, price increases across tiers drove much of the growth in beauty, although some consumers—particularly those in emerging markets such as the Middle East—also indicated a desire to spend on higher-priced categories. One challenge beauty players will face includes understanding why consumers may be trading down and where their appetite for luxury products is growing, given that we see a mix of both trade-down and trade-up behaviors in the market.

Mass beauty, the least expensive segment, represented 48 percent of the beauty industry’s value in 2023.  Despite the proliferation of luxury beauty offerings in 2023 and 2024, such as those from luxury brands that do not specialize in beauty, this segment is not yet saturated.

Online sales channels accounted for much of the beauty industry’s growth at the height of the COVID-19 pandemic. While online sales growth was still strong in 2023, growth in physical channels accelerated during this period.  

Global sales at specialty beauty retailers—those that cater specifically to beauty consumers—grew 14 percent last year. (North American and European specialty beauty retailers in particular propelled this growth.)  To appeal to younger shoppers, these retailers prominently display products that are trending online to help bridge the gap between the online and in-store experience. To that end, best-in-class specialty retailers also continue to cultivate engaged social media communities.  As most beauty players know by now, the decision about whether to focus efforts on in-store retail or e-commerce is really a matter of “and.” 

The beauty industry has proven resilient in the face of economic turbulence, but the era of de facto price-fuelled growth is over. To build sustainable momentum, best-in-class beauty brands will need to create real value from product differentiation, supported by greater productivity. Executives should focus on becoming more attuned to shifting consumer preferences while doubling down on their brands’ and products’ unique value propositions. Agility and speed to market—which the use of new technologies such as AI and generative AI can enable—will distinguish the best from the rest, as will the ability to cultivate strong communities of loyal customers.

For business leaders, the idea of applying gen AI to strategic planning is mouthwatering. One manager recently exclaimed that he couldn’t wait for the time when “AI can help identify opportunities that don’t exist yet!”  But is there a chance we’re overestimating gen AI’s capabilities? How do we identify the areas, if any, where gen AI can boost strategic planning? Are all gen AI tools the same, or are some of them more capable in certain scenarios?

To answer these questions, the authors detail two business cases involving activities central to strategic planning. The following insights can be gained from these two cases.

ChatGPT’s underlying large language model, though trained on vast data, lacks access to company-specific information, explaining some omissions. These systems are “non-deterministic,” meaning each response may differ. Asking gen AI tools to simply “provide 10 more ideas” helps create a long list and avoids such blatant omissions.

On a non industry perspective gen AI could help with divergent thinking, a key skill in any successful transformative team.  Can AI forecast future demand for the specific services?”  While gen AI is a sophisticated technology, it cannot predict the future. This is because gen AI tools are loaded and trained on historical data. The question requires looking forward, not backward, for making projections about the bottom line, such as future sales figures or achievable growth.  However, with clever prompting, gen AI tools can provide food for thought. 

Some gen AI tools, such as you.com, offer “retrieval augmented generation,” or RAG, blending large language model outputs with most-current internet data. This approach provides up-to-date information and can potentially incorporate internal company data. However, such capabilities require organization-specific deployment. Public tools like ChatGPT or Claude.ai currently lack this feature.

While gen AI offers significant advantages, it’s crucial that you recognize its limitations for strategic planning. These come from the way gen AI works. It sifts through vast amounts of data and sentence completes as it goes with the most probable next word. While this is remarkable, in essence it’s backward looking.

However, knowing gen AI’s weaknesses allows you to take advantage of its strengths. It can enhance your ability to identify opportunities, mitigate risks, and develop more robust strategy by dropping in some outside-the-box suggestions that may not have come immediately to mind. These must always be filtered with human discernment, but since the tool is so fast and cheap, why not give it a run?  The key is to view gen AI as a tool that augments, rather than replaces, your strategic thinking and decision-making.

Leading organizational change according to the conventional management playbook is difficult and often frustrating, and such efforts rarely stay on track. In the authors’ hard-won experience in organizational transformation projects at several companies, they found that the idea of large-scale transformation can leave employees feeling overwhelmed and insecure about their ability to thrive in the new order. But they learned that by deploying a strengths-based approach at the individual level and then using it to constitute and manage diverse teams, we could win employee commitment to transformation. This approach can help reduce anxiety and burnout, increase inclusive and collaborative behaviors, and cut across hierarchical and functional boundaries.  Four steps for successfully driving transformation:  

1. Create a strengths framework for the organization, and begin socializing the language. Assess employees using objective, proven tools to identify their top strengths. Institutionalize communication around strengths through simple actions, like including people’s strengths in their email signatures. Use strengths language routinely to help employees see themselves and others as contributing unique capabilities.
2. Map the strengths profile of all unique roles in the organization so that people start viewing jobs through that lens. Matching available strengths (people) to needed strengths (roles) helps to recast people into roles based on what they are naturally good at and reduces biases in talent decisions.
3. Identify the organization’s strategic priorities with the involvement of midlevel managers from across the organization. Then form diverse, strengths-based teams to work on each of those business priorities, cutting across functions and levels. Ensure that they have the tools to work together effectively. Train and equip teams with design thinking tools and techniques to build the capability for collective, innovative problem-solving with a human-centered approach.
4. Anchor all talent systems and processes to the strengths framework — hiring, onboarding, performance measurement, reward and recognition, development, role change and promotions. Shift the focus of the performance measurement system to measuring the progress and impact of teams rather than individuals.

Now that corporations call all employees leaders, how can you tell the real ones from the pretenders? Examine your own leadership skills, and also evaluate what you read and hear from other “leaders’ with the following guidelines:

1. Is Your Communication Correct?  Nowhere do we hear more misinformation than from our politicians. Look no further than the transcript from the latest stump speech to find inaccuracies that fall into several categories:  What the candidates say that they hope is true?  What the candidates say that they suspect is untrue?  What the candidates say that they know is untrue?  What the candidates say that’s a bold lie, hoping their audience is moronic?  Once you earn the reputation of being a truth-teller—whether good or bad truth—accuracy about “the facts” earns respect. And respect ratchets up your chances that people will follow you as a leader.
2. Is Your Communication Complete?  If you have kids, you know how dialogue ends.  You know kids will whine until you give an understandable reason. Bosses, peers, clients, and staff are no different. People respond to plausible reasons.  When you’re not forthcoming about reasons for policies, plans, projects, or procedures, imaginations run wild. None of which will be favorable to you as the mysterious leader.
3. Is Your Communication Current?  Managers often get caught up in the trap of hanging on to past, favorable results, despite outcomes from more current projects. Governmental agencies withhold data until the cause-and-effect becomes totally obscured or at least “overcome by events.”  Whether in engineering or human resources, real leaders need to be up to the minute in how they measure and what they report.
4. Is Your Communication Clear?  Three key components of clear communication: 1) Direct phrasing. 2) Structure. 3) Timing.
5. Is Your Communication Purposefully Unclear?  If you intend to be understood, avoid “technobabble”. Unfortunately, some professionals have learned that if you couch an idea in enough jargon, nobody will understand what you mean. Therefore, they get no questions or pushback.  Gobble-de-gook may be expected in today’s workplace, but it’s rarely respected. Simple ideas deserve simple, straightforward language.
6. Does Your Communication Show Concern?  Showing concern for others is not a new concept brought on by the ravages of Covid and its aftermath in the workplace. In fact, empathy is as old as the Golden Rule.  How do leaders demonstrate concern? Listening. Asking questions to show interest. Being approachable. Using respectful language—even during conflict or disagreement. Setting policies that show concern and respect to all involved.
7. Does Your Communication Demonstrate Competence?  Competent leaders deliver results, not excuses. The essence of leadership is solid communication. Competent leaders exhibit mastery in basic communication skills that they use daily to get work done through other people: writing skills, public-speaking skills, meeting facilitation, conflict resolution, negotiation skills—from deadlines to desirable outcomes.
8. Are You Personally Credible?  Sometimes the difference between motivation and disengagement comes down to the personal presence of the person leading the charge. Do others trust you personally? That trust will flow from a combination of the following:  Their perception of your confidence—based on how you look, talk, think, move, act.  Their perception of your character: Is your outside-the-office persona the same as what people see every day on the job?  Their perception of your commitment to excellence. Do you do what you say you will?  Answers to these questions tell you how personally credible others believe you to be.

Within the new venture realm, there is a big difference between having an innovative product versus an innovative business. Some business ventures have a new technology but stick to a tried-and-true business model. Others take an existing product and give it new life with a creative business model. The most competitive new businesses do both, all the time and every time.

In today’s competitive world, with its accelerating rate of change, no competitive advantage lasts long. According to Josh Linkner in his book Disciplined Dreaming, we have entered the Age of Creativity, in which each incremental gain is zeroed out as global competitors quickly copy and adapt. The only sustainable competitive advantage is creativity.

He makes the case, and the author agrees, that creativity in a company, large or small, doesn’t just happen–it requires a culture. If you want to build and maintain a creative culture in your organization, you need to make sure your operation is guided by these seven critical strategies:

1. Fuel passion. Every great invention, every medical breakthrough, every advance of humankind began with passion: a passion for change, and for making a difference. With a team full of passion, you can accomplish just about anything. To promote passion, you need to develop a sense of purpose, promote collaboration, and have fun.
2. Celebrate ideas. Many businesses give lip service to their celebration of innovation, but punish, rather than reward, risk-taking and creativity. In a creative culture, rewards come in many forms: money, yes, but great businesses also celebrate creativity through praise (both public and private), career opportunities, and perks.
3. Foster autonomy. People and teams that can call their own shots are better able to produce valuable creative output, since requiring approval at every step kills the creative process. Granting autonomy first requires extending trust. The key is to provide a clear message of what you are looking for, and then get out of the way. 
4. Encourage courage. Netflix, which is known for its creative culture, tells employees to “Say what you think, even if it is controversial. Make tough decisions without excessive agonizing. Take smart risks. Question actions inconsistent with our values.” Encourage team members to take creative risks without fear.
5. Fail forward. Rather than characterizing something that doesn’t work immediately as a “failure,” position it as an experiment. These experiments can be called “failing forward,” because each one leads you one step closer to the perfect solution. The key is to fail quickly. Flush out ideas and let go of the ones that fail.
6. Think small. When you want to foster big ideas, it’s important to have a strong sense of urgency, be nimble, and not afraid to embrace change. It’s easier to accomplish this in a small team, in a small local environment, before you try to extend it to a much larger infrastructure. You will see results sooner and be more able to overcome opposition. 
7. Maximize diversity. A diversity of thought and perspective fuels creativity and builds creative cultures. To connect with customers, for example, you need to understand the world from their perspective, not yours–this is one area where a diverse culture can make a huge difference.

Estée Lauder chairman Leonard Lauder called it the “lipstick effect” — the growth in demand for small luxuries during times of economic uncertainty. The assumption behind this phenomenon is that when people are under more stress, beauty and self-care rituals offer a form of psychological comfort.

McKinsey even reported a surge in demand for skincare and wellness products during the pandemic. So, with fears of an economic downturn never far from the surface, might the same apply to the more affordable alternatives to surgical procedures like tummy tucks?

One of the most recognizable dermatology brands in the U.S., LaserAway, has now expanded to over 120 locations and reports the industry has been growing at over 20% annually in America. CEO Scott Heckmann says that LaserAway experienced “strong years” in 2008 and 2020 despite the recessions.  Three lessons can be drawn from this case example that can help other companies recession-proof themselves in an unpredictable economic climate.

1. A changing market is a good market.  When customers trust a clinic’s practitioners with something as sensitive as their bodies and faces, being very transparent about what’s involved in a procedure is critical to credibility. LaserAway’s social media features videos with real people, real nurses, actual treatments and basic plotlines — at their heart, these procedures are about helping people find their self-confidence.  Providing people with a realistic picture of likely outcomes also ensures they are more likely to end up satisfied with the treatment.  Technology has been a key factor. While cosmetic surgeons have a very limited audience at a high price point, medspa clinics offer myriad services that open the door to a large market — including an increasing number of men. In fact, skincare makes up 45.6% of the global men’s grooming market (worth $85.2 billion in 2023) as old masculine stereotypes give way to self-care among younger generations.
2. Diversification builds resilience.  In many industries, brands must be niche with their products or services. But medspa chains like LaserAway, Sculpt MD and Sono Bello can on-sell a range of services while still maintaining expertise in each area. That diversification is really important because it drives repeat customers and more revenue.  Medspa businesses offer an average of 47 services. Having a balance of higher and lower-value offerings like this is a great strategy to maintain steady income through economic fluctuations as people regard treatments as an ongoing investment in their well-being.
3. The power of referrals.  All beauty businesses need to be aware that the traditional sales model has evolved after first engaging customers through their different digital and marketing channels. The pandemic was the big impetus for digital influence, but people now want to be impacted through the use of real-life case studies instead of feeling like they are being “sold to.” Hence, the role of influencers.  The demand for more authenticity only reinforces the idea that the biggest point of sale in the beauty and wellness space should be referrals.