What is the role of the Government in the success (or failure) of a business? Answering this question can take many avatars, and one can be bombarded with multiple perspectives and opinions. But there are two follow up questions that can help set a direction towards an insightful discussion. Those questions are:
a. Should Governments be in the business of running a business?
b. Does government policy influence business, or does business influence government policies?
In this episode of Why Businesses Fail, we lean towards the first question. There was once an era when Public Sector companies in India dominated Television manufacturing. Brands like Uptron, Konark and Crown were household names in the 1980s. Within a decade, these brands virtually disappeared. What caused this implosion of the brands? Was it market transformation, changing customer preferences, or the inability of the companies to innovate and take risks, often due to regulatory shackles?
We also look at some other industries in India such as airlines, and information technology in this episode. The latter is a classic example that not every government policy or regulation is bad. In policies such as STPI or Software Technologies Parks of India have helped the technology sector. We leave the following question UN-answered for a reason - can Governments play a role in the failure of a business?