This paper presents the first in-depth descriptive look at the state of management practices in India. Using a unique dataset measuring the quality of management practices across countries and sectors, we find a consistent pattern of poor management practices in India in comparison to higher income countries across all the sectors studied: manufacturing, retail, education and healthcare. If we accept the link between good management and higher productivity, these findings suggest that poor management practices could be a factor behind the lower levels of development of many countries. Particularly in manufacturing and retail, the low average score is mainly due to a large tail of badly managed firms, which is thin or non-existent in higher income countries. Ownership structures, competition, education and informational barriers seem to be important drivers of the quality of management practices. Finally, when looking across regions, we also find that management quality varies in tandem with levels of development.
Lemos, D.; Scur, D. Could poor management be holding back development? Describing practices in the public and private sectors in India (IGC Working Paper). International Growth Centre (IGC), London, UK (2012) 53 pp.