By | Dr Pavan Soni | IIM-B Innovation Evangelist
Have you ever been to a Marwari wedding? If you haven’t, you are perhaps missing one of the most unabashed exhibitions of wealth and opulence that you would ever witness. Even a grand Punjabi wedding might pale in comparison (that, however, come as a close second). You then visit the same Marwari home, especially of that of the bride, the next day and you would see a very different environment. Except from the leftovers of the oversized party for the last night, there won’t be many traces of what had really happened! You would now be witnessing perhaps the nadir of austerity, and this time, even Jews won’t make a cut. How does one reconcile the two days in a typical Marwari household? And trust me, what I have portrayed here is not an aberration at all. How do you explain this paradoxical behaviour? Being a Marwari, perhaps I can throw some light.
For all their business acumen and financial success, the Marwari community remains mostly inscrutable, and largely misunderstood.
There are often labelled as misers, to an extent of being cunning; money minded, to the extent of moulding their social ties to suit their business logic; and opportunistic, with a chameleon-like ability to blend into the local environment. While many might think of these as vices, I deem these as virtues worth studying and emulating.
To help understand some of these behavioural patterns, one needs to look at explicating the paradoxes. Here, I talk about three crucial and relevant dimensions that first-generation entrepreneurs and family business owners would find useful. These paradoxes are around the dimensions of spending, educating, and socializing.
Spending: Daily austerity, with rare opulence
On an ongoing basis, a Marwari household could arguable be the most economic one. The eating habits, the daily wear, the stuff at home (except jewellery), a non-existent discretionary spending, and very limited non work-related travel, ensures that the survivability of a Marwari family is robust. The food (almost always vegetarian, with limited vegetables) and clothing (as if fixed in time at around 80s) are the signatures of a Marwari household. This frugal living makes it rather easy for a family of ten (large families are typical here) to settle in a small-sized apartment without much of brawls. The interesting fact is that even when the business is going rather well, the living standards remains largely unchanged, and this inelastic work and living ethics help the family and the community tide over financial distresses. Since the living standards remain at a constant low profile, the wealth remains largely invisible (almost opposite to a Punjabi family), and oozes out on rare occasions.
There are typically three occasions where Marwaris spend lavishly- birth (of a male child), marriages, and deaths.
The wealth, which is so far very carefully nurtured and cornered, now comes out in various hues and shades, mostly red and golden. The relationships which mostly looked like business ties spring up as relatives and mostly distant ones, and the sweet tooth starts to etch one more time. These occasions, especially marriages, are opportune moments to forge social ties and exhibit creditworthiness to a potential or extent business partner.
Historically, in the absence of institutional intermediates, such as formal money lenders, banks, judiciary, and legal bodies, carrying out trade over long distances and for bigger amounts was difficult. This lack of collaterals and institutional mechanisms of arbitration would severely limit the economic ambitions of otherwise God-fearing Marwaris. So, what is the solution? Social alliances. A marriage between the wards of two trading partners would offer serious sanctions to any opportunistic behaviour by either party and would allow trade to happen.
The social capital stood as a substitute to financial capital and this remains the backbone of business expansion till date.
It is the frugality, on a daily basis, and a very tight control on outflow that allows for such build-up of capital. Interestingly, all the money outlay on marriages actually comes back multi-fold when business starts to kick in. So, in the mind of a Marwari, it’s not an expense, it’s an investment.
Education: Opening the mind without transforming the heart
Education is seldom encouraged in Marwari families for male children, let alone for girls. When I set out to do my PhD, I was seriously going against the community by breaching the glass ceiling, where my cousins barely managed to graduate. I somehow corrected the order, when after my doctoral ordeal, I stated my company (genes were calling). However, the relationship between formal education and the business remains precarious. While a father wants his son to study well to grow the business and be more polished, but also not study too much as to develop a disinterest (read disillusionment) in the business. That makes education a paradox.
Education becomes a tricky deal especially because of the thorny issue of succession planning. A son (typically) can’t take on the reigns unless he has developed sufficient skills in the business and has earned enough social equity, and this calls for him to shadow his father or uncles. This might mean lesser time at studies, limited visibility beyond the current education, no study related conversations at home, and above all, no role models in sight. And yet the father wants his son or sons to take the business national, if not global.
The real risk of higher education, especially at abroad, is the potential of losing the child to another business, to a job, or self-employment, or worst still, a girl of another community.
Yet, the necessity of higher education, especially outside of India, has increasingly become a status issue, for money never has been a limiting factor. The second-best option is to get the child educated locally, and yet keep the interested acute towards the family business and keeping other distractions at bay.
The case with the girl child is however interesting. Increasingly, the Marwari parents are more liberal, of late, when it comes to the education of their daughter(s). Where Home Science was a preferred avenue a few years back, now the parents even don’t shy away for giving at shot at medicine, or law, or even more new-age careers. Often, the female siblings end-up becoming more educated than their male counterparts. That’s where the social dynamics become interesting. In the marriage market, the prospect brides are beating the potential grooms in both education and exposure. She is not willing to settle with a traditional business-boy who hasn’t stepped out of his town, let alone state, and the parents of the groom aren’t prepared to reconcile with this fact.
At present, the tussle of how much to educate a child yet keeping the allegiance to family business and grow the family tree remains acute. This might take some interesting turns in terms of fragmentation of families, emergence of alternate models of higher education, and a shakeup of the family-business order.
Socializing: Blending-in while remaining rooted
Every city in India would have a shopping district, typically wholesale market, earmarked by Marwari shops. Whether it is Chickpet of Bangalore, or Sowcarpet of Chennai, Burrabazar of Kolkata, the Marwaris have a signature style of setting up shops and selling (almost anything). These shops are typically loaded with a wide variety and depth of offerings, have efficient space management, and are with minimalistic frills. The shopkeepers and the support boys are so fluent in the local language and dialect that one doesn’t feel out of place. In the same sentence, the Marwari can effortlessly weave in words from the local language, in local accent, Marwari, Hindi, and an occasional English word.
Almost no other business community is as proficient as Marwaris are in picking up the local language and culture. Their ability to blend-in is almost magical, and more importantly, non-threatening.
You wouldn’t be hearing unrest or social clashes in Marwari communities with the local folks (as that against the business logic). This benign approach of blending-in stems from their ability to keep a low profile, have a service mindset, and of being frugal. They celebrate the local festivals, typically maintain the customs, and have an orderly approach towards living and doing business, and all this while remaining connected to the customs from back in Rajasthan.
How do you make out if a certain shop belongs to a Marwari? The immediate giveaways are the austere dressing sense, not giving ‘no’ as an answer, and having a high space utilization. The sense of customer orientation, frugality, accounting acumen, and a sense of what moves and what doesn’t, comes quite naturally to the fellows. These skills, they well understand, stem from the roots and the traditional values. Such attributes get further cemented with the local associations, Samaaj, and other charitable and non-charitable trusts that keep the ethos alive and relevant.
These were just three of the several apparent paradoxes that the Marwari community manages quite effortlessly. In fact, these paradoxes make them so successful in business, which is perhaps a testimony to the fact that constraints liberate creativity. Hence, instead of looking at West, may be, our entrepreneurs can look at Western India on how to run successful businesses for years, if not generations.