Corinne Olinger Final Exam-India
Summary recommendations-
As your advisor setting up your first international business expansion, a summary report is in order. By choosing to expand in the East, I can tell you that India’s ancient civilization has provided a large foundation of knowledge in a society that has created intellectual capital and has an advantage over some other countries by being familiar with the English language after their occupation by the British Empire for a hundred years. India is now synonymous with Information Technology (IT). Its software developers and IT products/services are second only to the United States.
There are more than 250 multinationals that are invested in India thus far. The reasons for investing are
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If it is going to take 30 to 39 months to build, and we need more than 120 licenses from different agencies, I would advise that we begin as soon as possible. India (for the time being) appears to be a prime choice for a new hotel venture and I recommend that we expand into this new market and see if we can’t give the “Taj” a run for its money. How soon can we hire the Director of Sales and Marketing? That should be our first call.
Porter’s Diamond analysis-
The previous, depressing view of India has changed over the last two decades. India has gone from having a population said to be an overwhelming burden to being viewed as a vast source of human capital of 1.2 billion. India has large reserves of coal and many resources they can now produce; however, they are heavily dependent on imports due to their lack of natural gas supply and oil. Because of their human resources and their use of the English language, India has everything they need for a knowledge-based economy.
Conditions of demand- The more demands the customers in India’s economy make, the greater the pressure will be facing India to constantly upgrade its competitiveness via innovation, not to mention the unrelenting pressure to improve its quality. More than 250 multinationals have been attracted to the world’s 12th largest economy to set up research
India has become a global conduit for business as they have liberalized their economic policies over the past 20 years. Companies are flocking to India because of many factors, including, less expensive labor costs, increasing growth rate, and an abundance of a highly skilled workforce. These factors in addition to other advantages have substantially increased the number of United States businesses looking to grow beyond the U. S borders into the county of India. Dunlop Software Consultant’s goal is to also expand its operations internationally and believes that India has the business environment to meet our goal of expansion globally.
(firms) have overall – some have invested in foreign countries through FDI - felt that
Globalisation has also been a resulting factor for the dramatic increase in technology. Bangalore, in the Silicon Valley of India is experiencing a remarkable IT boom, that is transforming the prospects of India’s economy. The internet is the fastest growing tool of communications. It took just 4 years for the internet to reach 50 million years, in contrast to the
For a long time, India has been experiencing a huge population growth. In fact, it will pass the population in China. However, the population growth has not matched it overpopulation growth. Despite the large population, India has a huge labor force. The quality of the jobs in India is awful and even though they can use all of their people. They can’t use them well. Because people have low paying jobs. The government doesn’t have enough money to handle the large population. As a result, their infrastructure is poor, which means people can’t go to different places so that people can’t get jobs. The lack of education is also a big issue for the people and the government because the government doesn’t make as much money if people aren’t getting jobs or getting low paid jobs. Many of people living in India is also causing environmental issues it creates health problems. Therefore, India population has the potential to be highly productive, but the huge amount of people in India makes it extremely hard for India to grow and develop.
Consumer departmentalization is based on division by customers served. A common example is an organization that has one department to handle retail customers and one department to handle wholesale or industrial customers.
But it is clear that the India’s success came not from home demand but from US demand. Indian engineers have been for years working for US companies, especially in IT sector. With the growth of IT industry, there has been developed a sort of strong “Indian connection” in Silicon Valley. According to Anna Lee Saxenian, an associate professor at the University of California at Berkeley whose research is a study about Silicon Valley’s immigrant, that “of an estimated 2,000 startups in Silicon Valley 40% are Indian-spawned.” [4] The Indian connection in Silicon Valley, the intellectual capital in India and the trend of outsourcing in current global competition altogether bring India a great competitive advantage.
Now we produce mainly technicians, not scientists or technocrats and feel proud to export such raw materials to manpower-starved developed countries ( be it IT or BT, the two main pillars of Indian economy today). This might lead to some degree of prosperity in the short term but we are going to loose in a big way in the long run unless we totally overhaul our basic education system at primary and high school level. It’s useless to cut the roots and then water on the top.
|Answer : The Indian IT industry has been the great success story of India's liberalisation. Starting with an export of around $100 million and |
As promised, here is some information about the INFS2621 Exam Format. I also want to take this opportunity to thank you all very much for being such a terrific class! I hope you have enjoyed the course and learnt a lot - I certainly have enjoyed teaching you as a group.
The meteoric rise of India in the area of IT and Business Process Outsourcing (BPO) was attributed to resource and industry based view of IB strategy (Peng et al 2008). These views are based on the opinion that cheap labour, excellent skills and virtuality are major factors responsible for their growth. Nonetheless, institutional considerations are found to be quite relevant in India’s context. Considerations in the areas of education subsidy to top Universities and various economic reforms including liberalisation by government institutions played crucial roles in making India a competitive environment for investments (Peng et al 2008). These institutional references can conveniently stand as the third tripod of the IB strategy.
Eric Rivers has been a hired by leading firm to offer strategic advice to technology firms in the fast growing Indian market. He also decided to leave his job back in the United States of America (USA) and move to India. He is an experienced manager with management skills and was eager to bring about a change to the Indian developing economy. He had two visions for the industry those were empowerment and a flat hierarchy.
After IMF and World Banks involvement India took steps towards liberalization and privatization to reform India’s economy. Lowered tariff levels, reformed exchange rate policy, liberalized industrial licensing policy and also relaxed India’s foreign direct investment (FDI) policy. These reforms opened the doors for multinational corporations to invest in India. India received positive responses from international investors. Before the 1991 reforms, foreign equity ownership was restricted to 40 percent and the transfer of technology was necessary to do business in India. These barriers were removed for foreign companies. Many multinational corporations (MNCs) took advantage of India’s new economic policies and increased their stakes to more than 51 percent in their subsidiaries resulting in a several fold increase in foreign direct investment in just three years (Gosai, 2013).
Government policy is in the favor of foreign companies, to develop the infrastructure Indian state and central government encourages the foreign investors and companies.
That is why fdi (foreign direct investment) show huge growth with the last decade. Many foreign companeis (pepsico, nokia, walmart, general electrical etc) and bank (citi bank, standard chartered, abn amro etc) are entering in India day by day however many more is to come. |
It is evident that FDI stock in India has been increasing and foreign direct investment policy is becoming liberal for attracting more foreign investors (Government of India, 2006). Keeping in view the liberal economic