Knowledge@Wharton -- Strategic Management

Amid Worries of a Slowdown, Charting India's Future Growth Trajectory

Thu, 19 Jan 2012 10:35:35 EST

India's growth trajectory has been losing some direction recently, a victim of political bickering and an economic slowdown. Though concerned about the deceleration, Indian business leaders attending the recent 16^th annual Wharton India Economic Forum in Mumbai remained upbeat about the country's long-term potential. They also offered suggestions about how India could regain some of the lost momentum.

Will India's Current Diversification Trend Pay Off for Companies?

Thu, 12 Jan 2012 10:43:06 EST

Reliance Industries, India’s leading private sector company, has garnered notice with its recent announcement of a major foray into the media and entertainment sector. Reliance’s move is also reflective of a larger trend of companies moving outside their comfort zones. Of course, diversifications are not new to Indian firms. But unlike earlier, the current spate of activities is strategically driven, rather than mere opportunism. There have been some failures, however, and the final outcome of many of these efforts remains to be seen.

The Vanity Deal: Why Indian Firms Are on a Buying Spree

Wed, 26 Oct 2011 14:56:58 EST

Indian companies are on a buying spree. While some acquisitions are in sync with the firms' existing businesses, others are buys designed to catapult the company making the purchase into the global arena. Chinese and Japanese firms have been making similar moves for years, and Indian companies are only now catching up. But experts caution that the businesses must be careful to choose "trophy" purchases that will enhance shareholder value.

Can (and Should) Bollywood Go Hollywood?

Thu, 06 Oct 2011 14:10:02 EST

Corporatization is changing Bollywood -- as India's Hindi-language film industry is popularly known -- offering new opportunities for investment in a sector that is expected to be worth US$2.7 billion by 2015. Companies are finding more legitimate avenues, such as banks, to finance their films, and diversifying revenue streams to move beyond box office receipts. While some worry that the shift clashes with traditional methods of filmmaking, others say that it's not happening fast enough.

Is Small-car Manufacturer Maruti Suzuki Suffering from an Identity Crisis?

Thu, 05 May 2011 14:48:27 EST

India's Maruti Suzuki has been known for years as a manufacturer of small cars. Recently, it has forayed into the luxury space and has also become a big exporter. In addition, it supplies original equipment and complete vehicles to Nissan, sells used cars and runs driving schools. All this could be considered complementary activities or -- as some critics contend -- unnecessary diversions. Can Maruti afford to spread itself thin? At the same time, can it afford to ignore the market beyond the compact car?

Indian Restaurant Chains Have Overseas Expansion on Their Menus

Thu, 21 Apr 2011 15:29:28 EST

The restaurant business in India is booming as consumers' disposable incomes increase. As a result, food and hospitality chains are moving into the interior of the country. Many entrepreneurs are also outward bound: They are expanding their chains to other countries, exploring expansion opportunities and capitalizing on the growing popularity of Indian fare in the United States, China and beyond.

Diamonds Are Not Forever: Industry Moves from Israel to India

Thu, 07 Apr 2011 15:02:34 EST

In the 1980s and 1990s, Israel was the world's major producer of polished diamonds. However, high labor costs have made the industry in Israel uncompetitive. As a global realignment takes place, Israeli companies are finding niches in value-added segments, and they are also focusing on their technology development skills. Meanwhile, India has become the world's largest manufacturing center for cut and polished diamonds, contributing 60% of the world's supply in terms of value and 85% in terms of volume.

A New Core Purpose: Expansion Gives 'Rise' to Rebranding at Mahindra

Thu, 24 Mar 2011 14:56:56 EST

The US$7.1 billion Mahindra Group has undertaken a massive rebranding exercise. In the past decade, Mahindra has moved beyond its traditional business of tractors and utility vehicles and now has a presence in sectors as disparate as aerospace, financial services, IT, hospitality, motor-boats and real estate. The conglomerate has 121 companies and has moved beyond Indian shores. Experts say that the 65-year old group is on the right track with its makeover, but they warn that it will be not be easy to get all stakeholders on board.

Indian IT Services: Shaping Up for the Next Big Push

Thu, 24 Feb 2011 14:48:03 EST

As the U.S. economic recovery gathers pace, India's US$60 billion IT services industry faces the imperative of retooling and repositioning itself to avoid losing out on growth. Among other things, Indian IT firms need to move up from low-margin outsourced work to assignments where they can offer business benefits to their customers. They also need to master new technologies like cloud computing. In line with the new realities, IT majors are reshaping strategies and management structures, acquiring companies and hiring aggressively.

Wharton's John Paul MacDuffie on the Nano and Tata Motors' 'Real Test'

Thu, 27 Jan 2011 14:47:11 EST

Tata Motors could have learned several lessons about the launch of its small car, the Nano, from the experiences of automobile manufacturers in the West. The problems with the US$2,700 Nano, which was introduced in 2009, were many, although they principally centered on marketing. According to Wharton professor of management John Paul MacDuffie, the Tatas appear to have woken up now. There is no reason why the Nano should not be a success in India, although exporting the model could still be problematic, he says in this opinion piece.

No Takers: Is the Tata Nano Running Out of Gas?

Thu, 27 Jan 2011 14:47:11 EST

The Tata Nano, the least expensive car in the world, drew rave reviews when it was launched in 2009. But the "frugal engineering" India is well known for was accompanied in this case by "frugal marketing," and advertising spends were very low. Today, sales appear to have slumped. Tata Motors is now rethinking its strategy. Can the Nano woo back customers, or is it too little, too late?

ITC Chairman Yogi Deveshwar: Creating a 'Future-ready' Conglomerate

Thu, 13 Jan 2011 14:26:05 EST

In August 2010, ITC marked its 100th anniversary in India. Over the past century, the firm has moved from being a single-product (tobacco) company to one of the largest, multi-business corporate enterprises in the country. Chairman Yogesh "Yogi" C. Deveshwar says ITC wants to become the largest consumer goods conglomerate in India. In an interview with India Knowledge@Wharton, Deveshwar talks about ITC's diversification strategy and also its sustainability initiatives -- both of which are designed to make ITC "future-ready."

Indian Outsourcing Companies Think Strategy Even as Pressure Mounts

Thu, 16 Dec 2010 15:39:12 EST

Outsourcing has become a bad word in America, with many blaming job losses on companies' decisions to contract out certain services or departments to third-party vendors. Prior to the global economic downturn, Indian business process outsourcing (BPO) companies had relied a great deal on the U.S. market for future growth. They are now reworking their strategies and attempting to diversify, despite hope from many observers that the backlash against outsourcing is a trend with a shelf life.

Wipro's Abhijit Bhaduri on Preparing Talent for Tomorrow's Challenges

Thu, 18 Nov 2010 15:59:22 EST

Today's "learning organization" focuses on much more than skills development. It looks at empowering employees to work in multiple locations and cultural settings and to apply insights across different industry verticals, says Abhijit Bhaduri, chief learning officer at IT services firm Wipro in Bangalore. In a conversation with India Knowledge@Wharton and Ravi Aron, senior fellow at Wharton's Mack Center for Technological Innovation, Bhaduri discusses the relationship between Wipro's corporate strategy and corporate learning initiatives and shares his ideas on how managers can help employees find a larger relevance for their work.

Economic Gains: Will the Commonwealth Games in Delhi Deliver What They Promised?

Thu, 21 Oct 2010 14:30:05 EST

In the run-up to the 2010 Commonwealth Games in Delhi in early October, the Indian government said the event would generate several million new jobs and a US$5 billion boost to GDP. But chaotic organization resulted in a sharp scaling down of expectations. Questions are being asked today about whether the Games were really worth it. And, as India climbs the economic ladder, is there a connection between sports performance and GDP?

Corporate Strategist Homi Khusrokhan: 'Success Is Something You Feel Deep Inside'

Sun, 15 Aug 2010 23:24:28 EST

Homi Khusrokhan has spent more than 40 years in the corporate sector with companies like Tata Tea, Tata Chemicals and the Glaxo group in India. Last year, he was appointed special advisor to the board of Satyam. In an interview with India Knowledge@Wharton, Khusrokhan discusses the aftermath of the Satyam scandal, the secret to making corporate acquisitions successful and some leadership challenges he has faced during his career.

Telecom Travails: Will Reliance Industries' Entry Mean Competition or Consolidation?

Thu, 17 Jun 2010 16:16:04 EST

Reliance Industries has entered the Indian telecom sector after the end of a non-compete pact between the group's chairman and managing director, Mukesh Ambani, and his brother, Anil Ambani. Bidders have paid huge amounts for 3G and WiMAX licenses in the recent auctions. Are they ready for another price war, or will Reliance's entry spark off the inevitable consolidation?

Affordable Luxuries: Godrej Hopes to Clean Up in Rural India

Thu, 03 Jun 2010 15:24:46 EST

For many households in rural India, what the rest of the world considers everyday products are luxuries to be indulged in once in a while. Hoping to change that thinking, Godrej Consumer Products, India's second largest bath soap manufacturer and part of the US$2.3 billion Godrej Group, is rapidly penetrating rural markets. Its year-old Project Dharti program aims to cover 8,000 small towns and 50,000 villages by 2012. However, revenue growth could be underwhelming given the high cost of distribution and other challenges of doing business in the hinterland.

Wharton's Jagmohan Singh Raju: 'Consumers in Rural Areas Care for Value More Than Price'

Thu, 06 May 2010 14:04:44 EST

The rural market in India is difficult to penetrate. Most U.S. multinationals (MNCs) have failed to enter it, though European companies have had a better success rate. One of the ways MNCs can improve their chances, says Wharton marketing professor Jagmohan Singh Raju, is by designing products for the rural market and not treating it as a dumping ground for goods that can't be sold elsewhere.

MNCs in Rural India: At a Turning Point

Thu, 06 May 2010 14:04:44 EST

Multinational businesses in India are under pressure to make their strategies in rural India deliver top- and bottom-line results, despite the relentless challenges of operating in the hinterland. After years of false starts, missed opportunities and flawed strategies, a number of MNCs' India businesses are getting close. Others already are there and are ramping up their rural investments. None can take that fine balance between doing good and doing business for granted, as the companies profiled in this special report show. Sanjeev Chadha, chairman and CEO of PepsiCo India, puts it this way: "Our rural agenda has been driven by purpose and now it is moving into performance."