'Shy' Parsis and 'secretive' Chettiars: Stereotyping 'biz communities'

Chettiar businessmen are secretive. Marwaris are, of course, thrifty in the extreme. Parsis are “shy and reserved” and “honest and straightforward.” And as for the Punjabi Khatri businessmen, well, their defining characteristic is that they “love their family” and are “unfailingly polite.”

Such are the cultural stereotypes that abound whenever the topic turns to “business families” and “business communities.” The latest issue of Outlook magazine, with the cover story on Best Business Schools, looks at the landscape of Indian business through the prism of traditional business communities, and presents a sociological profile of some of India’s well-established business communities - from Marwaris to Patels to Bohra Muslims to Parsis to Punjabi Khatris to Reddys to Chettiars to Syrian Christians.

The endeavour, one supposes, is to determine what renders these traditional communities particularly entrepreneurial and therefore to “map their DNA” so to speak. Yet, for all the weight of anecdotal evidence that binds these communities to their respective roots, what emerges overall from the narrative are rough-edged, crude approximations.

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True to the point that a clich becomes a clich only from mindless overuse, such cultural stereotypes reinforce themselves each time they are trotted out in defence of sociological theories that trace entrepreneurship in India to the defining characteristics of India’s traditional business communities.

But the point about these stereotypes is that, much like the weatherman’s predictions about inclement weather, they are true only when they aren’t. And often the variance that you see within a specific sample set (in this case, a business community) is broader than the variance between two business communities.

[caption id=“attachment_466474” align=“alignleft” width=“380”]  Ratan Tata is the most famous Parsi businessman. Reuters[/caption]

Thus, for instance, in some cases, even the “jokes” that are intended to stereotype some of the defining characteristic of these communities are unoriginal. One of them goes thus:

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When Neil Armstrong landed on the moon, he saw some friendly-looking people there, with strange headgear. His conversation with them went something like this:

Armstrong: “Who are you and what are you doing up on the moon?”

Aliens: “We are Sikhs. Assi te Partition de baad hi aithe aa gaye (We came here after the Partition)!”

As a tribute to the entrepreneurial quality of Khatri Sikhs, which acknowledges no limitations of frontier, it may be said to mirror the truth to an extent. But south of the Vindhyas, much the same joke is narrated - but by planting a Kerala tea dispenser on the moon - and on top of Mount Everest prior to Edmund Hillary’s conquest.

Which just goes to show that what passes for “distinguishing characteristics” of these business communities isn’t particularly distinctive, after all.

There is, of course, a sociological context in which some communities have traditionally excelled in the world of trade and commerce.

As the lead essay by economic historian Raman Mahadevan points out, “business communities, as an organisational structure, were critical in facilitating wealth generation by the family firms in the initial phase of their growth, in a given historical context.”

In pre-independence India, for instance, entrepreneurs from across a few traditional business communities established firm control over what there was of the Indian corporate sector. And the “network effect” within the community helped spread the ripple.

Yet, with the “growing economic distance between family firms over time, community structures became less relevant.” As illustrative of this trend, Mahadevan points to the “rise of interest groups in the form of chambers of commerce and trade associations.”

In any case, there was nothing in common between these different business communities - in terms of social mores or cultural practices - other than that they all seemed to share a highly refined “market sensibility.”

The question of whether being part of an entrepreneurial ecosystem - such as might be expected within a “business community” - contributes to sharpening one’s business acumen is worthy of consideration, of course. But beyond providing an advantage in terms of “network effect”, they confer no specific advantage - to the point where, it’s fair to say that the entrepreneurial DNA, if there be one, doesn’t get passed on.

What perhaps works better as an “incubator” of new-age entrepreneurship is a secular ecosystem that facilitates fearless ideation, backed up by risk capital, and an atmosphere in which failure is perfectly acceptable. Such an ecosystem thrives, for instance, in Silicon Valley, although even there, the question of whether entrepreneurs are “born” or “made” stirs up extreme passions.

Indian-born serial entrerpreneur-turned-academician Vivek Wadhwa stirred the pot in 2010 with his observations that “entrepreneurs aren’t born, they’re made.” His research team surveyed 549 successful entrepreneurs, and found that the majority of them didn’t have entrepreneurial parents. In fact, he noted, many of them didn’t even have entrepreneurial aspirations when they went to school. “They simply got tired of working for others, had a great idea they wanted to commercialise, or woke up one day with an urgent desire to build wealth before they retired” - and therefore took the big leap.

Even in India, the number of first-gen entrepreneurs is growing. And they don’t exactly wear their caste or community affiliations on their sleeve. If they do profit from any “network effect”, it happens only in a secular space where capital scouts for ideas worth funding. In that sense, the emerging “community of Indian business” is vastly different from the “business communities” of yesteryear.

If Armstrong were to land on the moon today, or if Edmund Hillary were to scale Mt Everest today, they may yet meet a pioneering entrepreneur who has set up a flourishing business there. But he wouldn’t have made it merely on the strength of his being a Khatri Sikh or a Chettiar or whatever. He may not be secretive or thrifty; hell, he may not even be kind to his family - and may even be cruel to animals. If he had any distinguishing characteristic, it would only be that he was mad enough to conceptualise enough to sell a lunar business idea to some moneybag - who in turn was mad enough to bet on him.

And that’s the perfect ecosystem for entrepreneurship to flourish.