Impact of International Business in India

Impact of International Business in India India has emerged as a potential and a diversified market for the Western firms and other foreign investors. Earlier establishing a business in India was a challenging assignment, but economic reforms, brought in by different Indian governments over a period of time, have smoothen the course of entry for Western multinationals and other business magnets. Still it is considered difficult and a different proposal to do business in or with India, mainly because of its different business and socio- economic culture. Western multinationals/ investors dealing with India so far had to adopt major changes in their business style in order to serve effectively to their customers. This write up examines in detail the prevalent business, socio- economic, and cultural environments that western multinationals have to face in India, as well the implications of their adopted major changes in business practices to succeed in India. Business, socio- economic and cultural environments of India Family Business and non corporate culture Despite revolutionary changes since independence of India, the basic business style has remained the same as of family controlled businesses. Leading business families, from Birlas and Tatas to Reliance, keep total control on business of companies promoted by them. Major management posts in these business houses are always held by responsible family members. Though joint family system is slowly disappearing, but still there is a common tendency in Indian families to own a business. Another prominent feature of the Indian economy is that non- corporate sector has the largest share of the total business of the country. They are the largest employment providers. Growth in non- corporate sector is much faster than even in the corporate sector. Non- corporate sector is engaged in wide spread manufacturing and service industries, and these are again mostly family business. Non corporate sector work according to available conditions and develop their business models suiting prevalent conditions and systems. This way India is a high powered distant society. Western businesses will have to accept family authority while negotiating business deals with non- corporate as well as family controlled corporate sector. Multi Linguistic and cultural market with political challenges The business language in urban India is local language mixed with English. It is also mixed with Hindi and state dialects making it difficult for a casual business operator to negotiate. There are wide ranges of languages spoken in diverse India. Accordingly, perfection in one language by a Western business negotiator does not mean that he or she can represent his/ her business deals effectively in all parts of India. Though middle class rules the roast in India, but this class mostly believes in eastern culture, making it imperative for Western multinationals to adopt eastern tastes in their goods and services being marketed in India. At the same time it is difficult for foreign companies to standardize their products on national basis because of diversity in regional culture; but it may be possible in India on regional basis. Also foreign MNCs need to find out the consumers tastes in India before launching their products or services in Indian markets. One thing is necessary to understand that economic growth in India has brought up its middle class to the fore front; and at the same time rural poor are largely isolated from the achievements of growth.With a robust and working democratic system, India is a federal republic where bulk of executive power rests with prime minister and his or her cabinets. As a nation state, India presents a vast mosaic of hundreds of different ethnic groups, religious sects, and social castes. About one third of population lives in urban areas; an overwhelming majority of the remainder is engaged in the agricultural sector.(Michael F. Martin and K.Alan Kronstadt, August 31, 2007)Â  [i]Â  An Indian is so politically informed or connected that it would not be wrong to say that every Indian treats himself/ herself as a politician in one sense or the other. With the result every political event in India has great impact on consumer markets. Politically there is a relaxed atmosphere at present for foreign direct investments (FDIs). But businesses often get disturbed with unwanted political rallies and events. Very frequently opposite national political parties call for nation- wide strikes (called bandh in Indian dialect) on any hot issue. The entire economic process gets disturbed and with the result corporations and other businesses suffer huge losses. For example on July 5, India went on strike. The country closed down at several places after opposition parties protested an increase in the price of petrol or gasoline. (In India, the government controls petrol prices). The Associated Chamber of Commerce and Industry estimated that nationwide strike caused a production loss of US $ 2.8 billion (Human Resources, July 29, 2010)Â  [ii]Â  . Indian economy is also badly bitten by the inflationary bug. Even necessities of life have become costlier for public at large. Average citizens find it difficult to save something for luxuries. Still luxuries like cars, foreign tours etc are being sold at rates that envy other economies of the world. But this is a fact of urban India only, where black marketing and corruption is rampant. Corrupt politician and business people make ugly display of their wealth. There is no doubt that Indian economy is growing, but this growth is lopsided. The required growth in infrastructural sector is lagging behind. This has created a real bottleneck for long term growth and economic expansion. This information is necessary for Western MNCs to decide about their target sector as well the type of market available in India for their products and services. India is a free economy and taking advantage of this, many Western MNCs are also raising part of their capital investment from India itself. BPO business brought in by multinationals in India succeeded because the MNCs exploited the conditions to best of their advantage. The shortage of infrastructure for BPO business was a matter of concern for MNCs. But MNCs found that building infrastructure in India is much cheaper than developing the same in western countries. India is a developing country with huge populations. Naturally the availability of educated labor force at lower prices was a distinct advantage that MNCs exploited to enhance their overall profitability. Indian young population has proved to be more hospitable and courteous than their counterparts in Western countries. Educated young people have a lot of command in English language making it very easy and economical to get the customer convinced about the product being marketed by BPOs. The result is that BPO business in India has become not only a profitable for MNCs, but a bread earner for thousands and lakhs of its staff without pressing government resource s. Changes adopted by international firms to serve customers in India Adoption with local conditions or changing of business rules provide international business to grow firmly. Western multinationals have taken many rational and objective decisions keeping in view marketing and other conditions prevalent in India. Changes in business style are necessary as the risks in the international business are not the same as in domestic markets. Some of changes adopted by Western MNCs to serve their Indian customers are discussed hereunder. Organized Retailing and direct marketing Barring exceptions like Bata stores and few others, retailing in India so far has been fragmented and not organized. Organized retail stores and trendy chain stores to catch the young customer is be one of the major changes brought in India by Western MNCs to serve and attract their customers. Though the trend is same as in western countries, but organization style has changed. Family owned businesses are being attracted to own retail stores and develop a chain of stores as franchisee or under other arrangements with MNCs. A few successful examples are McDonalds, Levis Strauss and others. Organized retailing is growing in India. With the results manufacturers are loosing their positions. Even local brands like Pantloons and Shoppers Stop are offering competitions to manufacturers owned stores. An organized franchisee style of retailing has ushered. It is also seen that family owned businesses seek franchisees of western MNCs. Many multinationals are entering Indian market though partnerships with local giants in the organized retail sector. Direct marketing is another change brought in by the MNCs. Earlier joint venture technique of marketing has changed to direct marketing. Products are not being sold on agency basis. Goods are not manufactured but traded by MNCs in chain stores either owned by them or their franchisees. Earlier the trend was to find low cost manufacturing location in India for producing goods in India, and then marketing the goods by entering into joint venture agreements with local giants. No doubt MNCs are still benefitting from low cost production, but the trend has changed to offer the products and services directly to customers. Creating products to serve Indian markets One of the major changes that western MNCs have made is the introduction of products and services that suits Indian style of consumption. This means not only developing affordable products and services that deliver value to the customer, but also finding right kind of distribution channels and designing credit systems to permit the access of the poor to financial services. (Michael John Baker and Susan Hurt, 2007)Â  [iii]Â  In fact MNCs are taking full advantage of availably of large number of engineers, technicians, and other experts to introduce products as per Indian tastes of consumptions. Take the case of US Pizza Hut selling pizzas through its outlets in India. What they have brought to India is not an American style pizza but a way of serving food in a nice, clean, bright place at a price an ordinary family can afford. But the food they serve is what Indians like. In many cities in India, Dominos offers a 100 percent vegetarian pizza, cooked in a separate kitchen where no me at items are allowed. (Subash C. Jain, 2003)Â  [iv]Â   In fact marketing style the product has also changed by Western MNCs. For example creating small packs with simple designs and less volume at affordable prices will not only boost sale but also create brand awareness among a particular section of consumers. Introduction of financing schemes with marketing of products create an urge to buy among those who cannot afford the goods temporarily. This is certainly not unethical if the interest rates are reasonable. This is because reasonability is the basic rule of marketing. Another marketing idea floated by MNCs is to provide products and services on rental or lease basis instead of making a direct sale. This may take shape of hire- purchase sale or simple renting if the consumer does not want to purchase the product. Conclusion Indian market has peculiar characteristics. Owning family business is still the rage in Indian society that is multi linguistic with Hindi or English as link language. Inflation is very high and the conditions in India always remain political charged. Abundant educated labor force is available at reasonably cheaper wages. Corrupted people flaunt the use of money in an ugly way. Under such circumstances different democratically elected Indian governments created liberalized conditions for MNCs and other foreign investors to enter the Indian market. Businesses like BPO units succeeded immensely in India. Foreign investments also established varied businesses for their customers in India. For satisfying customers in India, these MNCs made concessions and changes in their traditional style of operations. Direct marketing and organized retailing are the major changes bought in by MNCs to satisfy their Indian clientele. Products also changed to suite Indian tastes of consumptions. Leasing and hire- purchase selling have become style of MNCs to satisfy their customers in India.

Organizational Structure and Design Essay

1.1 Introduction Samsung India Electronics Ltd is a subsidiary of Samsung Electronics Corporation headquartered in Seoul, Korea. The company was incorporated in the year 1995. The company is having their head office at Delhi and branch office at 16 locations all over the India. Their manufacturing facilities are located at Noida in Uttar Pradesh and Sriperumbudur in Chennai. The company is having two R&D centres in India, at Bangalore and Noida. Both the R&D centres are involved in cutting edge research and development. The company is dealing in the business of IT, Consumer Electronics and Household businesses. They provide high technology consumer electronics. Their products in India are colour television, colour monitors, refrigerators, washing machines, mobile phones, microwave ovens etc. The company is the first in India to introduce fuzzy logic based washing machines, silver nano refrigerator and flat screen TVs. Samsung phones support five Indian languages, namely Hindi, Marathi, Bangla, Punjabi and Tamil. 1.2 Organization Strategy Strategically the electronics industry was considered suitable for countries with poor natural endowment and high skilled labour like Korea. This industry required labour intensity, knowledge intensity but low input  requirements of energy and raw materials. Samsung electronics has not only utilised status-quo resources but also developed dynamic capabilities as it rose to the top. Aggressive and risk-taking investment behaviour in search of entrepreneurial rent and the effective policy of managing technology development contributed to the extraordinary achievement of Samsung Electronics. The company’s remarkable transformation over the last decade or so can shed light on how a firm’s dynamic capabilities, the ability to improve its O-advantages by reconfiguration, transformation and learning, contribute to its home country’s idiosyncratic development path. The company transformed itself from a sub-contractor to a manufacturer to a leading creator of many electronic components by harnessing a talented team. Samsung took quite a few risks initially to achieve its goals, it kept its winning team refreshed by constant vigilance and talent renewal. Samsung employees put leadership ahead of excellent personal development courses and structures which Samsung Electronics evolved in the 2000s. The same quality could be seen in the company’s Suwon campus. That leadership came primarily from Yun Jong Yong and Lee Kun-hee above him. There was full inter relationship between the Samsung group and Samsung electronics which also lead to a coordinated and smooth functioning of Samsung. 1.3 Organization Structure Samsung Electronics organizes its businesses according to its different characteristics in technology, markets and consumers as either Digital Media & Communications (DMC) or Device Solutions (DS) division, strengthening their independent operating structure. DMC is grouped into Consumer Electronics (CE) and IT & Mobile Communications (IM) divisions. The CE division took charge of the visual display business department and home appliances department. The IM division is in charge of managing wireless businesses, IT Solutions, Network business, digital imaging displays and the Media Solution Center. This restructuring reflects changes which were made to the workforce with the hiring of soft power experts which has become more important than ever  in the ‘Smart’ age. They have already announced their intention to make a paradigm shift by becoming a soft driven company and established a ‘Software’ center in order to increase their software capacity until it’s on a par with their world renowned manufacturing. Changes in the Device Solutions (DS) division also took place including expansion of the organizations in charge of software, controller and solution development to ensure separate teams for each. The expansion of the software related organizations was done to realize Samsung Electronics vision of creating new values and experiences by combining Samsung’s existing strength in hardware design with optimized software and an emotionally appealing user interface. Samsung Electronics also expanded the organization in charge of bio and medical device business and expanded the Bio Lab at Samsung Technology Research Center into the Bio Research Center. They also hired bio material experts to strengthen their research in this area and increased support for bio similar and bio medical research. Organization Chart Refer Exhibit 1 for detailed description of Samsung’s organizational chart with respect to Samsung mobile division of India. 1.4 Organization Culture It has become increasingly important for employees to have vested stake in the growth potential of its company. People expect a participatory work environment where they can feel a sense of dignity, pride, and ownership of the organization’s vision. Samsung Electronics strives to build a creative organizational culture, and acknowledges that the investment they make in strengthening the core competencies of their employees will have a direct impact on their competitiveness. They actively promote a flexible organizational culture that allows employees to pursue a healthy work-life balance, in a dynamic, creative and challenging work environment that is not risk-averse. As an international company they embrace individuals with  different background and abilities. Work and Life Balance through Work Smart: Establishing a Work Culture that Encourages Learning and Development: Samsung Electronics has established a Creative Development Research Institute System to provide employees with opportunities to pursue creative new ideas that take full advantage of their talents and professional passions in a way that encourages taking risks. This new initiative encourages employees to be more entrepreneurial in developing creative ideas that can become new businesses. Once an employee’s plan is accepted, they may concentrate on the project as a member of a task force for up to one year. During this period, they will be free from their usual responsibilities and may receive a dedicated work space, development expenses and necessary equipment as appropriate. Successful outcomes are encouraged through an incentive program; however they are not subject to penalty if they don’t achieve their goals. Some of the other key-features of Samsung’s culture are: * Talent based recruiting of Software and Design experts * Diversity Management * Employees Health and Safety * Integrity Management * Increasing Social Contribution 1.5 Technology Employed: The organization’s core technology is manufacturing which consists of raw material inputs, a transformation work process that changes and adds value to the raw material and produces the ultimate product or service output that is sold to the consumers in the environment. Core Technology On the other hand, Samsung Electronics has also a department work process  that is important to the organization but is not directly related to its primary mission and that we call as non-core technology. For Samsung Electronics, that major non-core technology is Research and Development (R&D) which transforms ideas into new products. Some of the other departments of non-core technology are Human Resources, Accounting, and Marketing etc. Refer Exhibit 2 for Samsung’s Mobile division R&D office structure in India. 1.6 Organization Size: Samsung Electronics has a total of 196 subsidiaries around the world. As of the end of 2011, Samsung Electronics’ total employment stood at 101,973 working in Korea and 119,753 outside of Korea, with the overseas workforce surpassing the domestic workforce for the first time in the history of Samsung Electronics. Currently, Samsung’s total employment is more than 344,000 employees globally.

Gac Compare and Contrast Essay - 1445 Words

----------------------- GAC008 Assessment Event 4: Academic Research Essay Compare and Contrast: Places Where People Live and Work Student’s Name: Teresa Ding Student ID#: SHSA23052 Teacher: La Roi Williams Due Date: 15th April 2013 Word Count: 1041 Question: Compare and Contrast attitudes toward students taking a gap year in your country and in U.K. Use specific examples and provide appropriate evidence to explain your answer. To take a gap year or not to take a gap year? Now, this question has gained more attention than it used to be. A gap year is a period of time in which students disengage from curricular education and†¦show more content†¦Basically Chinese parents regard sending their children abroad as a risk-free investment. Usually Chinese families spend all their money supporting their children. So they want their children go back to China with a degree which can help them get a job as soon as possible. Therefore Chinese parents think their children won’t benefit from taking a gap year. At the same time, most Chinese students study abroad in order to increase self-worth and foster personal competitiveness in employment, so taking a gap year is not something they would consider. Most colleges in the U.K encourage students to take a gap year, simply because students then arrive a little more mature, a little more ready to study and a little more worldly. University like Oxford are very supportive about

Is Human Cloning Legal Essay - 1147 Words

Human cloning has not been legally used in humans because many people and experts are still discussing its effectiveness, worthiness and effect on humanity. Human cloning, also known as human genetic engineering, can be divided into two main types, which are therapeutic cloning, growing cloned tissue from individual, and reproductive cloning, genetically identical copy of an individual. Human cloning have drawn people’s attention because people are become more concerned about health problems and tried to find a methodology that can help them live longer and better; human cloning seems to be one of the possible choices. However, it is still being discussed its trade-off between benefits and risks. Despite medical benefits and advancement of†¦show more content†¦In addition, human cloning in the form of reproductive cloning may provide an alternative way of having a genetically related offspring for infertile and same sex couples. Chambers (2002) Staicu (2012) state th at reproductive cloning may be a good solution for homosexual couples to have a child, and it can help infertile couples to overcome their health problems. As a result, a number of health-related benefits seem to be found in both types of human cloning and these benefits could provide a better life for people. Human cloning not only has several medical benefits but can also contribute to the advanced knowledge of humanity. The theory of human cloning can be learned, adapted and extended to other fields in many ways. This biotechnology has destroyed the limit of people’s knowledge about the human body in depth, which will provide many further benefits. Learning more about disease therapy and extend it to the pharmaceutical field is one of these benefits. Embryonic stem cell and cloning research could be used as cellular models to understand the cause of the diseases and could be used to test new drugs (Devolder Savulesca, 2006). 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