This document provides an overview of strategic management and strategy evaluation. It defines strategic management as the process of specifying an organization's objectives, developing policies to achieve those objectives, and allocating resources to implement strategic plans and policies. The document then discusses four key tests a strategy must pass to be evaluated: internal consistency, environmental consonance, competitive advantage, and feasibility. It also outlines five steps to align employees with an organization's strategy: providing strategic thinking tools, communicating the strategy, aligning structure, reflecting strategy in jobs, and gaining buy-in. The purpose, objectives, scope, assumptions, and limitations of a study on IT industry strategies and employee awareness are then presented.
This report analyzes the IT industry in India and Tata Consultancy Services' (TCS) business strategy. It provides an overview of the growing Indian IT industry and its competitive advantages. It then performs a PESTLE analysis of the external environment, Porter's Five Forces analysis, and a SWOT analysis of the industry. For TCS, it describes the company's profile, financial performance, resources, service offerings, and growth strategies. It analyzes TCS' strategies using the BCG matrix and provides recommendations to strengthen TCS' position, such as focusing on higher value services and intellectual property.
This document discusses Tata Consultancy Services' (TCS) business model and strategies between 2007-2008 and 2013-2014. It analyzes TCS' business model using PESTEL analysis and external factor evaluation matrices for the two time periods. The analysis shows that TCS has strategically built advantages related to cost efficiency and service efficiency over time through business choices that created interrelated positive consequences and sustained competitive advantages.
This document provides an analysis of the IT services and products industry in India. It includes a PESTEL analysis identifying key political, economic, social, technological, legal and environmental factors impacting the industry. Porter's five forces and value chain analyses are conducted. The strategies and SWOT analyses of industry leaders TCS and Infosys are also examined, along with how their strategies may need to change given future industry trends. The future of the Indian IT services industry is seen as very promising with continued growth expected.
This document provides an overview of the Indian IT industry and Tata Consultancy Services (TCS). It discusses the external factors impacting the Indian IT industry through a PESTLE analysis and Porter's Five Forces model. It also analyzes the strengths, weaknesses, opportunities, and threats for the overall IT/ITES industry in India and conducts an internal analysis of TCS, including its resources, capabilities, and strategy. The document aims to provide recommendations to help TCS maintain its leadership position in the growing Indian IT industry.
Tata Motors was losing $108 million annually in its commercial vehicle business unit in 2001 due to market shrinkage. It implemented a new corporate strategy to turn this around. The strategy involved forming a corporate team to design a balanced scorecard approach and coordinate resources across business units. It centralized sourcing to reduce costs and communized parts. This allowed economies of scope where combined production of passenger and commercial vehicles exceeded the total if produced separately, improving profits by over $106 million within two years.
Organisational Structure and Elements of Infosys, HUL and Maruti SuzukiIndranilMondal19
The document discusses the organizational structures of several companies. It provides details on:
1) Infosys' previous functional structure and its recent realignment into a matrix structure to be more agile and attract young talent.
2) HUL's functional structure and how it ensures skill development, decision making clarity, and accountability.
3) Maruti Suzuki's shift from a functional to a project-based structure after industrial unrest, with direct reporting to directors and cross-functional teams focused on goals.
This report analyzes the IT industry in India and Tata Consultancy Services' (TCS) business strategy. It provides an overview of the growing Indian IT industry and its competitive advantages. It then performs a PESTLE analysis of the external environment, Porter's Five Forces analysis, and a SWOT analysis of the industry. For TCS, it describes the company's profile, financial performance, resources, service offerings, and growth strategies. It analyzes TCS' strategies using the BCG matrix and provides recommendations to strengthen TCS' position, such as focusing on higher value services and intellectual property.
This document discusses Tata Consultancy Services' (TCS) business model and strategies between 2007-2008 and 2013-2014. It analyzes TCS' business model using PESTEL analysis and external factor evaluation matrices for the two time periods. The analysis shows that TCS has strategically built advantages related to cost efficiency and service efficiency over time through business choices that created interrelated positive consequences and sustained competitive advantages.
This document provides an analysis of the IT services and products industry in India. It includes a PESTEL analysis identifying key political, economic, social, technological, legal and environmental factors impacting the industry. Porter's five forces and value chain analyses are conducted. The strategies and SWOT analyses of industry leaders TCS and Infosys are also examined, along with how their strategies may need to change given future industry trends. The future of the Indian IT services industry is seen as very promising with continued growth expected.
This document provides an overview of the Indian IT industry and Tata Consultancy Services (TCS). It discusses the external factors impacting the Indian IT industry through a PESTLE analysis and Porter's Five Forces model. It also analyzes the strengths, weaknesses, opportunities, and threats for the overall IT/ITES industry in India and conducts an internal analysis of TCS, including its resources, capabilities, and strategy. The document aims to provide recommendations to help TCS maintain its leadership position in the growing Indian IT industry.
Tata Motors was losing $108 million annually in its commercial vehicle business unit in 2001 due to market shrinkage. It implemented a new corporate strategy to turn this around. The strategy involved forming a corporate team to design a balanced scorecard approach and coordinate resources across business units. It centralized sourcing to reduce costs and communized parts. This allowed economies of scope where combined production of passenger and commercial vehicles exceeded the total if produced separately, improving profits by over $106 million within two years.
Organisational Structure and Elements of Infosys, HUL and Maruti SuzukiIndranilMondal19
The document discusses the organizational structures of several companies. It provides details on:
1) Infosys' previous functional structure and its recent realignment into a matrix structure to be more agile and attract young talent.
2) HUL's functional structure and how it ensures skill development, decision making clarity, and accountability.
3) Maruti Suzuki's shift from a functional to a project-based structure after industrial unrest, with direct reporting to directors and cross-functional teams focused on goals.
The FMCG sector in India grew rapidly in the 1980s and 1990s but then lost momentum due to a lack of innovation by companies and the introduction of new product types. However, consumer willingness to upgrade to better products helped revive the FMCG sector in the 2010s. The FMCG sector is the 4th largest in India and includes household care, personal care, and food and beverage products. Hindustan Unilever Ltd., Procter & Gamble, and ITC are the top three FMCG companies in India. The sector has significant growth opportunities due to India's large population and vast rural markets.
Infosys industrial , company analysis and option Deep Kumar
This document provides an analysis of Infosys, an Indian IT company. It includes information on Infosys' profile such as its founding date and major clients. It also analyzes India's macroeconomic indicators, the IT industry forces using Porter's five forces model, and Infosys' strengths, weaknesses, opportunities and threats through a SWOT analysis. Financial ratios and the intrinsic value of Infosys are also calculated. It recommends selling Infosys shares since the market value is higher than the intrinsic value. Finally, it discusses a long call options strategy to benefit from being bullish on Infosys.
A project report on Competitor analysis of_tata_motorsMba projects free
Tata Motors and Maruti Suzuki are two major automobile companies in India. The document provides a detailed comparative analysis of the two companies, including their histories, SWOT analyses, PEST analyses, and marketing strategies. It examines factors such as Tata Motors' acquisitions and joint ventures, its product portfolio, and government policies that have impacted growth. For Maruti Suzuki, the analysis covers its introduction and partnership with Suzuki. The conclusion compares the overall positions of the two companies in the Indian market.
Reliance Jio offers affordable 4G services in India including free voice calls, low data rates, and inexpensive LYF smartphones starting at Rs. 2,999. It aims to provide access to its high-speed internet and digital services across all economic classes. Jio also offers a range of apps and services like JioTV, JioCinema, JioMusic as well as the JioFi wireless hotspot device. The launch of Jio has significantly impacted competitors by gaining over 100 million subscribers and increasing India's mobile data usage.
Tata Consultancy Services (TCS) is an Indian multinational information technology service and consulting company headquartered in Mumbai, India. It is India's largest IT services company and a subsidiary of Tata Group. TCS provides a wide range of IT and IT-enabled services to clients across various industries globally. Over the years, TCS has expanded its operations and client base through both organic and inorganic growth strategies. It has a large workforce of over 300,000 employees located across 46 countries.
A detailed report on ONE PLUS (more specifically One Plus 3, and how it was a game changer for them). This report covers from their start till recent developments on One Plus 6, analyzing various aspects of research and development. The report consists of the following sections: Initial Marketing Strategy used, Macro Analysis, Legal Analysis, Economic Analysis, Socia-Cultural Analysis, Technological Analysis, Environmental Analysis, Micro Analysis, Target Market, Distribution Channel, Suppliers, Competitors, Customers, Current Target & Marketing Mix, SWOT analysis and Recommendations.
This document provides an analysis of Larsen & Toubro Limited (L&T), a large Indian engineering, construction, and manufacturing company. It outlines that L&T was founded in 1938 in Mumbai and is one of India's largest private sector companies. The document summarizes L&T's business segments, key financial figures such as revenue, income, and share price, and discusses increases in the company's assets, sales, and profits in recent years. It also outlines some of L&T's future plans to expand internationally and in business areas like housing and general insurance.
The document discusses ITC Limited's human resource development strategies, including attracting and developing top talent through training programs. ITC focuses on leadership development, skills training, and creating a responsive culture. Key talent management strategies include recruitment from top campuses, investments in learning and development, and encouraging local employment.
This document provides an overview of Tata Motors, including its history, product range, milestones, and international operations. It discusses how Tata Motors was established in 1945 and has since become India's largest automobile company. It also lists Tata Motors' many achievements and milestones over the years, such as developing India's first indigenous passenger car. The document then provides details on Tata Motors' expansion internationally through subsidiaries and joint ventures around the world.
Tata Consultancy Services (TCS) is one of the leading global IT services, consulting and business solutions organizations. It aims to be among the top 10 global IT companies by 2010 in terms of revenue, profitability, customers and technology leadership. TCS provides innovative consulting, IT solutions and services across industries, with a workforce of over 74,000 professionals spread across many global delivery centers. It helps customers optimize business processes and create resilient IT infrastructure to ensure faster business results. Some of its key competitors include Infosys, IBM, Wipro and Cognizant.
Tata Motors faced declining market share in passenger vehicles due to being perceived as a taxi brand. It launched various campaigns across different media platforms with separate agencies to change this perception and establish itself as a youthful, innovative brand. Key campaigns included #GetSetBolt for a digital launch, #MyCityMyZest Twitter campaign, and #FantasticoNameHunt to crowdsource a new name. Later campaigns like #MadeofGreat with Lionel Messi and #Fantastico's virtual reality experience boosted brand image. Through innovative campaigns, experiential marketing, and new models like Tiago and Hexa, Tata Motors was able to improve its passenger vehicle sales and turn around its brand perception.
Tata Motors has a global footprint across various countries in Asia, Africa, Europe, and South America. It has assembly operations, technical centers, and collaborations that support its wide range of commercial and passenger vehicles. The company leverages various resources including its large R&D establishments, strong financial position, robust supply chain and dealer networks, and strategic partnerships to strengthen its market position globally.
1) The document summarizes the industrial relations issues between Maruti Suzuki and its workers at the Manesar plant in Haryana, India from 1997-2012.
2) In July 2012, violence broke out at the plant resulting in one death and injuries to over 100 people after months of tensions between workers and management over issues like wages, temporary workers, and union recognition.
3) Both workers and management blamed each other for the violence and disruptions, with workers citing issues like low pay, harsh working conditions, and abuse, while management accused workers of sabotage and intentionally reducing quality and output.
Mahindra & Mahindra is considering acquiring Jiangling Tractor Company in China to expand into the global farm equipment market. A feasibility study found strengths in complementary product portfolios and technical skills, but also weaknesses in JTC's restructuring needs, inefficiencies, and cultural barriers. A joint venture would give M&M access to the growing Chinese market and a local partner. It is recommended that M&M focus on after-sales service, restructuring JTC's costs and processes, improving skills mapping and training, and establishing itself in China before considering exports or new markets. A joint venture agreement and approvals would need to be finalized to acquire JTC's plant, inventory, and dealerships.
The document provides a quarterly financial update for Tata Elxsi Limited for Q4 FY15. Some key highlights include:
- Net sales increased 9.34% YoY to Rs. 2312.76 million in Q4 FY15.
- Net profit grew 26.04% YoY to Rs. 298.36 million in Q4 FY15.
- EBITDA decreased 4.34% to Rs. 468.88 million in Q4 FY15 compared to the prior year.
- For FY16E and FY17E, net sales and PAT are expected to grow at a CAGR of 9% and 20% respectively.
Tata Steel is an Indian steel company and subsidiary of Tata Group. It has manufacturing operations in 26 countries and employs around 80,500 people. Some key points:
- Tata Steel was established in 1907 and is headquartered in Mumbai, India. It acquired UK steelmaker Corus in 2007 in its largest international acquisition.
- It has an annual crude steel capacity of 25.3 million tonnes and is the 11th largest steel producer globally.
- The company's vision is to be a global benchmark in value creation and corporate citizenship through excellence of people, innovation, and conduct.
- Tata Steel has manufacturing facilities in India, Europe, Southeast Asia and produces a variety of
Hyundai is launching the new Genesis model to target the premium car market and move away from its past strategy of focusing on low cost. To gain a competitive advantage, firms can pursue either a low cost strategy, differentiation strategy, or focused strategy. Michael Porter's model outlines how firms can analyze their value chain activities to lower relative costs or create unique differentiation to deliver extra value for customers.
This document discusses factors affecting strategy implementation in Iraqi public sector organizations. It defines key terms like strategic management, strategy implementation, and the Iraqi public sector. The problem statement notes the need for strategic management in the public sector due to changes in management and a lack of implementation practices. The objectives are to identify factors influencing implementation and understand the process. Research questions focus on facilitators and impediments to implementation. The significance is providing knowledge to support implementation in developing country public sectors. The document reviews frameworks identifying factors such as organizational structure and culture, leadership, resources, and communication that influence successful strategy implementation.
The FMCG sector in India grew rapidly in the 1980s and 1990s but then lost momentum due to a lack of innovation by companies and the introduction of new product types. However, consumer willingness to upgrade to better products helped revive the FMCG sector in the 2010s. The FMCG sector is the 4th largest in India and includes household care, personal care, and food and beverage products. Hindustan Unilever Ltd., Procter & Gamble, and ITC are the top three FMCG companies in India. The sector has significant growth opportunities due to India's large population and vast rural markets.
Infosys industrial , company analysis and option Deep Kumar
This document provides an analysis of Infosys, an Indian IT company. It includes information on Infosys' profile such as its founding date and major clients. It also analyzes India's macroeconomic indicators, the IT industry forces using Porter's five forces model, and Infosys' strengths, weaknesses, opportunities and threats through a SWOT analysis. Financial ratios and the intrinsic value of Infosys are also calculated. It recommends selling Infosys shares since the market value is higher than the intrinsic value. Finally, it discusses a long call options strategy to benefit from being bullish on Infosys.
A project report on Competitor analysis of_tata_motorsMba projects free
Tata Motors and Maruti Suzuki are two major automobile companies in India. The document provides a detailed comparative analysis of the two companies, including their histories, SWOT analyses, PEST analyses, and marketing strategies. It examines factors such as Tata Motors' acquisitions and joint ventures, its product portfolio, and government policies that have impacted growth. For Maruti Suzuki, the analysis covers its introduction and partnership with Suzuki. The conclusion compares the overall positions of the two companies in the Indian market.
Reliance Jio offers affordable 4G services in India including free voice calls, low data rates, and inexpensive LYF smartphones starting at Rs. 2,999. It aims to provide access to its high-speed internet and digital services across all economic classes. Jio also offers a range of apps and services like JioTV, JioCinema, JioMusic as well as the JioFi wireless hotspot device. The launch of Jio has significantly impacted competitors by gaining over 100 million subscribers and increasing India's mobile data usage.
Tata Consultancy Services (TCS) is an Indian multinational information technology service and consulting company headquartered in Mumbai, India. It is India's largest IT services company and a subsidiary of Tata Group. TCS provides a wide range of IT and IT-enabled services to clients across various industries globally. Over the years, TCS has expanded its operations and client base through both organic and inorganic growth strategies. It has a large workforce of over 300,000 employees located across 46 countries.
A detailed report on ONE PLUS (more specifically One Plus 3, and how it was a game changer for them). This report covers from their start till recent developments on One Plus 6, analyzing various aspects of research and development. The report consists of the following sections: Initial Marketing Strategy used, Macro Analysis, Legal Analysis, Economic Analysis, Socia-Cultural Analysis, Technological Analysis, Environmental Analysis, Micro Analysis, Target Market, Distribution Channel, Suppliers, Competitors, Customers, Current Target & Marketing Mix, SWOT analysis and Recommendations.
This document provides an analysis of Larsen & Toubro Limited (L&T), a large Indian engineering, construction, and manufacturing company. It outlines that L&T was founded in 1938 in Mumbai and is one of India's largest private sector companies. The document summarizes L&T's business segments, key financial figures such as revenue, income, and share price, and discusses increases in the company's assets, sales, and profits in recent years. It also outlines some of L&T's future plans to expand internationally and in business areas like housing and general insurance.
The document discusses ITC Limited's human resource development strategies, including attracting and developing top talent through training programs. ITC focuses on leadership development, skills training, and creating a responsive culture. Key talent management strategies include recruitment from top campuses, investments in learning and development, and encouraging local employment.
This document provides an overview of Tata Motors, including its history, product range, milestones, and international operations. It discusses how Tata Motors was established in 1945 and has since become India's largest automobile company. It also lists Tata Motors' many achievements and milestones over the years, such as developing India's first indigenous passenger car. The document then provides details on Tata Motors' expansion internationally through subsidiaries and joint ventures around the world.
Tata Consultancy Services (TCS) is one of the leading global IT services, consulting and business solutions organizations. It aims to be among the top 10 global IT companies by 2010 in terms of revenue, profitability, customers and technology leadership. TCS provides innovative consulting, IT solutions and services across industries, with a workforce of over 74,000 professionals spread across many global delivery centers. It helps customers optimize business processes and create resilient IT infrastructure to ensure faster business results. Some of its key competitors include Infosys, IBM, Wipro and Cognizant.
Tata Motors faced declining market share in passenger vehicles due to being perceived as a taxi brand. It launched various campaigns across different media platforms with separate agencies to change this perception and establish itself as a youthful, innovative brand. Key campaigns included #GetSetBolt for a digital launch, #MyCityMyZest Twitter campaign, and #FantasticoNameHunt to crowdsource a new name. Later campaigns like #MadeofGreat with Lionel Messi and #Fantastico's virtual reality experience boosted brand image. Through innovative campaigns, experiential marketing, and new models like Tiago and Hexa, Tata Motors was able to improve its passenger vehicle sales and turn around its brand perception.
Tata Motors has a global footprint across various countries in Asia, Africa, Europe, and South America. It has assembly operations, technical centers, and collaborations that support its wide range of commercial and passenger vehicles. The company leverages various resources including its large R&D establishments, strong financial position, robust supply chain and dealer networks, and strategic partnerships to strengthen its market position globally.
1) The document summarizes the industrial relations issues between Maruti Suzuki and its workers at the Manesar plant in Haryana, India from 1997-2012.
2) In July 2012, violence broke out at the plant resulting in one death and injuries to over 100 people after months of tensions between workers and management over issues like wages, temporary workers, and union recognition.
3) Both workers and management blamed each other for the violence and disruptions, with workers citing issues like low pay, harsh working conditions, and abuse, while management accused workers of sabotage and intentionally reducing quality and output.
Mahindra & Mahindra is considering acquiring Jiangling Tractor Company in China to expand into the global farm equipment market. A feasibility study found strengths in complementary product portfolios and technical skills, but also weaknesses in JTC's restructuring needs, inefficiencies, and cultural barriers. A joint venture would give M&M access to the growing Chinese market and a local partner. It is recommended that M&M focus on after-sales service, restructuring JTC's costs and processes, improving skills mapping and training, and establishing itself in China before considering exports or new markets. A joint venture agreement and approvals would need to be finalized to acquire JTC's plant, inventory, and dealerships.
The document provides a quarterly financial update for Tata Elxsi Limited for Q4 FY15. Some key highlights include:
- Net sales increased 9.34% YoY to Rs. 2312.76 million in Q4 FY15.
- Net profit grew 26.04% YoY to Rs. 298.36 million in Q4 FY15.
- EBITDA decreased 4.34% to Rs. 468.88 million in Q4 FY15 compared to the prior year.
- For FY16E and FY17E, net sales and PAT are expected to grow at a CAGR of 9% and 20% respectively.
Tata Steel is an Indian steel company and subsidiary of Tata Group. It has manufacturing operations in 26 countries and employs around 80,500 people. Some key points:
- Tata Steel was established in 1907 and is headquartered in Mumbai, India. It acquired UK steelmaker Corus in 2007 in its largest international acquisition.
- It has an annual crude steel capacity of 25.3 million tonnes and is the 11th largest steel producer globally.
- The company's vision is to be a global benchmark in value creation and corporate citizenship through excellence of people, innovation, and conduct.
- Tata Steel has manufacturing facilities in India, Europe, Southeast Asia and produces a variety of
Hyundai is launching the new Genesis model to target the premium car market and move away from its past strategy of focusing on low cost. To gain a competitive advantage, firms can pursue either a low cost strategy, differentiation strategy, or focused strategy. Michael Porter's model outlines how firms can analyze their value chain activities to lower relative costs or create unique differentiation to deliver extra value for customers.
This document discusses factors affecting strategy implementation in Iraqi public sector organizations. It defines key terms like strategic management, strategy implementation, and the Iraqi public sector. The problem statement notes the need for strategic management in the public sector due to changes in management and a lack of implementation practices. The objectives are to identify factors influencing implementation and understand the process. Research questions focus on facilitators and impediments to implementation. The significance is providing knowledge to support implementation in developing country public sectors. The document reviews frameworks identifying factors such as organizational structure and culture, leadership, resources, and communication that influence successful strategy implementation.
Competitive landscape of the retail industry in indiaPrakhar Bhargava
The retail industry in India is large and growing, contributing 22% to GDP. While organized retail currently makes up only 5-14% of the total retail market, this sector is expected to grow significantly to $450 billion by 2015. Key players in the Indian retail market include Tata Group, Reliance Retail, and Future Groups. A SWOT analysis of Westside showed strengths in its brand name and customer base, but weaknesses in product range and differentiation. The industry has opportunities for growth due to rising incomes and urbanization, but also faces threats from local and organized retailers.
D-Mart has succeeded as a hypermarket chain where Vishal Megamart has failed due to differences in their expansion strategies and supply chain management. D-Mart expanded slowly, focusing on consolidating stores in prime locations before further expansion, while Vishal Megamart grew too quickly without proper capital or attention to locations. D-Mart also had stronger supply chain practices like quick supplier payments and inventory aligned to customer needs, unlike Vishal Megamart's distribution center model that failed to build an effective IT network and resulted in excess inventory.
Shoppers Stop-Competitive Advantage in Retail IndustryMeenaskhi Gaur
This document provides an overview of Shoppers Stop, a leading retailer in India. It discusses the company's vision, specialty stores, awards, financial performance, SWOT analysis, and competitive advantage in the retail industry. Key findings indicate that Store ambience and layout, product quality, additional facilities and services, and a preference for loyal consumers contribute to Shoppers Stop's competitive advantage, while limited offers and discounts and store locations weaken its advantage relative to competitors. The document recommends expanding Shoppers Stop's geographical reach, focusing service strategies, minimizing customer annoyances, ongoing consumer research, and providing better prices and discounts to enhance its position in the retail market.
How competitive forces shape strategy sec a group 4 (1)Prateek Singh
- Michael Porter's five forces framework analyzes the competitive environment in an industry by looking at five key areas: the threat of new entrants, the power of suppliers, the power of buyers, the threat of substitute products, and the intensity of rivalry among existing competitors.
- The framework is used to understand the profit potential and attractiveness of an industry, and can help companies develop strategies to improve their competitive position.
- When applied to the Indian aviation industry, the five forces analysis shows high supplier power, strong buyer power, low barriers to entry but high exit barriers, threats from substitutes like trains and video conferencing, and intense price competition among airlines.
Textiles Industry in India: A SWOT AnalysisCraftsinindia
The document discusses the strengths of the Indian textiles industry, including that it is an independent and self-reliant industry with abundant and low-cost raw materials and skilled labor. It has advantages in cotton fiber production as well as synthetic fibers and spinning, and is a major global exporter of cotton yarn, accounting for 25% of world trade. The industry represents the rich culture, traditions, and economic prosperity of India.
The document discusses Michael Porter's theory of competitive forces that shape business strategy. It outlines the five basic competitive forces that determine the intensity of industry competition - the threat of new entrants, the power of suppliers and buyers, the threat of substitute products, and the intensity of rivalry among existing competitors. It also discusses how strategists can analyze these forces to formulate strategies that position their company strongly against competitors in the industry.
The five competitive forces that shape strategy and campaignsPaul Friend
This document provides an overview of Michael Porter's five competitive forces model and how it can be applied. It discusses the components of the model, including suppliers, buyers, potential entrants, substitutes, and rivalry among existing competitors. The document explains that the model is useful for understanding the competitive landscape of an industry and a company's strengths and weaknesses. It also notes that Porter has updated his thinking on the model over time. Students are then assigned the task of conducting a five forces analysis of M&S to present to the group the following week.
The document discusses international payment methods, outlining the most common options including open account, direct transfer, check, letter of credit, collection, and bill of exchange. It notes that the choice of payment method depends on the risk assumed by the parties and cost of the transaction. A chart also compares the different methods on a scale of security of payment versus risk of non-payment.
This document discusses innovation in the Indian banking sector. It outlines various types of innovative banking like e-banking, core banking, corporate banking, investment banking, rural banking, NRI banking, and retail banking. It also describes types of products and services offered by banks, including total branch automation, any branch banking, demat services, microfinance, plastic money, and mobile banking. The document further discusses electronic systems used in banking, such as ATMs, RTGS, and the Finacle core banking solution. It concludes that reforms have changed Indian banking and improved technology, deregulation, and services, positioning India to become a global power in banking.
The five competitive forces that shape strategyTahia
The document discusses Michael Porter's five competitive forces that shape industry competition and strategy. The five competitive forces include: (1) threat of new entrants, (2) power of suppliers, (3) power of buyers, (4) threat of substitute products, and (5) rivalry among existing competitors. It provides details on how each competitive force impacts industry profitability and outlines factors that determine the intensity of each competitive force. The implications are that understanding industry structure through this framework helps position companies strategically and shape industries for long-term success.
The document discusses new trends in the Indian banking system, including increased use of technology and digital services. It outlines how banks have adopted technologies like core banking solutions, customer relationship management, electronic payments, real-time gross settlement, electronic fund transfer, electronic clearing systems, ATMs, telebanking/mobile banking, point of sale terminals, and electronic data interchange to automate operations, improve efficiency, and enhance customer service. The trends have redefined banking operations and allowed customers to access services anytime from anywhere. Foreign direct investment is also said to ensure better risk management and capitalization in the Indian banking sector.
Human Resource Management ( competitive advantage)fathima habeeb
The document discusses several theories and frameworks related to gaining a competitive advantage through human resources. It describes Barney's resource-based view which indicates that human resources can provide sustained competitive advantage if they are valuable, rare, imperfectly imitable, and non-substitutable. Porter's five forces model and innovation strategies are also mentioned. Finally, the document discusses frameworks from Boxall and Guest for identifying, defending, and leveraging human resources to achieve a competitive advantage.
Political risk refers to actions by foreign governments that can negatively impact investments. This includes war, government seizures of property, restrictions on moving profits out of the country, contract repudiation, currency inconvertibility, discriminatory taxation, embargoes, expropriation of property, and nationalization. Companies can purchase various types of political risk insurance to mitigate these risks when investing abroad. Risk management strategies also include diversifying investments across several countries, negotiating protection clauses in contracts, and pursuing bilateral investment agreements between the home and host countries.
This document discusses various methods of payment for export sales, including cash in advance, open account, letters of credit, sight bills, and usance bills. Cash in advance requires upfront payment before goods are shipped. Open account allows goods to be shipped before payment is due, usually within 30-90 days, but carries the highest risk for exporters. Letters of credit provide a bank guarantee of payment if terms are met. Sight bills require payment on delivery of documents, while usance bills allow acceptance of payment within an agreed credit period after delivery.
The document discusses Porter's five forces model as it applies to the apparel industry. It analyzes the competitive intensity and profitability of the industry by looking at the barriers to entry, power of suppliers and buyers, threat of substitutes, and rivalry among existing competitors. The summary is:
[1] The apparel industry has high barriers to entry due to economies of scale, significant capital requirements, and intense competition from established brands.
[2] Suppliers have bargaining power when materials are unique or undifferentiated, while buyers wield power in bulk purchases or when many supplier options exist.
[3] Substitute brands pose a threat if switching costs are low based on quality or status.
The textile industry is one of India's largest and oldest industries, contributing significantly to the national economy. It provides direct employment to over 35 million people and is the second largest provider of employment after agriculture. The textile industry contributes about 14% to industrial production and 4% to India's GDP. Major segments of the textile industry include cotton, silk, wool, readymade garments, and hand-crafted textiles. The industry has grown substantially since economic liberalization in the 1990s but still faces challenges from competition and rising costs. The government has introduced various initiatives and regulatory policies to support the textile industry.
Porter's Five Forces is a model for industry analysis that examines five competitive forces that shape every industry. The five forces are: the threat of new entrants, the threat of substitutes, the bargaining power of suppliers, the bargaining power of customers, and the intensity of rivalry among existing competitors. The model helps understand the attractiveness of an industry and the sources of competitive advantage within it.
This document discusses business plan strategy (BPS) and its importance for organizational success. It defines BPS as providing an overview of a business, including its history, products/services, goals, competitors, and growth plan. An effective BPS is considered one of the most important factors for business success. It can help guide a business strategically and serve as a monitoring tool. The document also notes that while BPS is crucial, long-term strategic planning is often lacking in many organizations.
11.business plan strategy as social responsibilityAlexander Decker
This document discusses business plan strategy (BPS) and its importance for organizational success. It provides details on key elements of an effective BPS, including outlining an organization's history, products/services, goals, competitive advantages, and growth timeline. It also discusses factors important for effective BPS, such as obtaining support from leadership, assessing costs of poor quality, and benchmarking performance against competitors. Overall, the document emphasizes that a well-developed BPS can provide guidance for an organization and help ensure its long-term viability.
Human Resource Development Audit is a systematic assessment of the strengths, limitations and developmental needs of its existing human resources in the context of organizational performance. This presentation describes how one can strategize a HR Audit for an organization.
14 hours agoNikesh Bantu Discussion 1COLLAPSETop of Form.docxaulasnilda
The document discusses aligning an Australian university's IT strategy with its overall business strategy. It analyzes the university's IT strategic vision document using Sharrock's "four agendas" framework to assess alignment. The analysis found some differences between the strategic priorities of the IT and university plans, revealing a need for IT planning methodologies to include measuring business alignment. Specifically:
1) The university strategic plan contained few direct IT references but several indirect ones related to new technologies and engagement.
2) Four IT-related business priorities were identified from the university plan: new forms of student engagement, research collaboration, modernization of IT, and high-quality IT.
3) Analysis using the four agendas framework showed
This document provides an overview of strategic management concepts. It defines strategic management as involving formulation, implementation, and evaluation of cross-functional decisions to achieve organizational objectives. The strategic management process consists of three main stages: strategy formulation, strategy implementation, and strategy evaluation. Strategy formulation includes developing a vision, identifying external opportunities/threats and internal strengths/weaknesses, and choosing strategies. Strategy implementation requires establishing objectives, policies, and allocating resources. Strategy evaluation assesses strategy effectiveness and drives corrective actions. The document also outlines various business strategies like market penetration, product development, diversification, and defensive strategies.
This report is about combination of various strategic management theories which has explains by different authors with different viewpoints according to the situations which they are looking at.
Strategic management can be basically describe as a process which analysis the current situation and make strategies which will matches to that. Basically strategic management has three main processes which can name as strategic formulation, implementation and evaluation.
First this report explains about what is strategic management and how it has implemented and how if effects for an organization. Compare to that briefing then the report focus on the theories which has found out to be explain in the journals which has selected to review the strategic management theories.
And then the report contains about the strengths and weaknesses of the each selected strategic management theory. After that it contains about a combination of all the theories which has mention in the report, to fill up the gap of each theory using the strength of the other.
Finally, in the conclusion the report shows the final view of the researcher about the finding throughout the research and the assumption which can make about combination of the strategic management theories and the use of this combination for a better performance.
The document discusses strategic planning and its importance for project managers. It outlines the key elements of strategic planning, including goal setting, strategy development, customer and internal business analysis, strategic choices, implementation, and evaluation. It argues that project managers need to understand business strategies in order to position themselves as partners rather than just hands, and that linking projects to corporate strategies is critical for success. A basic knowledge of strategic planning principles is necessary for project managers to fulfill this role effectively.
Page 1 of 2 Capstone Experience in Integration & Strategy .docxalfred4lewis58146
The document discusses undertaking a strategic audit to improve a company's performance. It recommends the following initial steps:
1) Analyze the external environment, including competition, market trends, and changes in customer needs.
2) Evaluate the company's resources and capabilities to determine what is and isn't working given the company's growth.
3) Assess if the company has the right people in the right jobs and make changes if needed.
4) Review the strategic plan and vision to ensure they are aligned with current capabilities.
Strategic planning provides a roadmap for where a healthcare organization is going and how to get there. It guides decisions on capital, technology, staff and other resources. The strategic planning process involves 7 steps: 1) reviewing the vision and mission, 2) analyzing strengths, weaknesses, opportunities and threats, 3) developing strategic options, 4) establishing objectives, 5) creating an execution plan, 6) allocating budgets and resources, and 7) ongoing review. When done correctly, strategic planning creates a culture of innovation, improves decision-making and resource allocation, and helps organizations deliver high-quality care by shaping their future.
This document discusses strategic management and business policy. It begins by defining strategic management as the art and science of formulating, implementing, and evaluating cross-functional decisions to achieve organizational objectives. It then discusses the nature, characteristics, and features of strategic management, including that it involves a long time perspective, is an intellectual process, has wide ramifications, and is a continuing dynamic social process. The document goes on to discuss the importance and relevance of strategic management, including its financial and non-financial benefits. It closes by emphasizing the importance of effective strategic management for business success.
This document outlines the key concepts and principles of strategic management. It discusses corporate strategy and why it is important for organizations. Corporate strategy involves commitments, decisions and actions to achieve competitive advantage and above average returns. It allows companies to keep pace with a changing environment, minimize competitive disadvantages, provide a clear strategic vision and goals, motivate employees, and strengthen decision-making. The document also defines strategy and outlines Mintzberg's 5 P's of strategy - plan, pattern, position, ploy, and perspective. Overall, corporate strategy is a comprehensive master plan for how a company will achieve its mission and objectives.
PSY-520 Graduate Statistics
Topic 7 – MANOVA Project
Directions: Use the following information to complete the assignment. While APA format is not required for the body of this assignment, solid academic writing is expected, and documentation of sources should be presented using APA formatting guidelines, which can be found in the APA Style Guide, located in the Student Success Center.
A researcher randomly assigns 33 subjects to one of three groups. Group 1 receives technical dietary information interactively from an on-line website. Group 2 receives the same information from a nurse practitioner, while Group 3 receives the information from a video tape made by the same nurse practitioner.
The researcher looked at three different ratings of the presentation; difficulty, usefulness, and importance to determine if there is a difference in the modes of presentation. In particular, the researcher is interested in whether the interactive website is superior because that is the most cost-effective way of delivering the information.
Group
Usefulness
Difficulty
Importance
1
20
5
18
1
25
9
8
1
23
15
20
1
16
9
22
1
20
6
22
1
28
14
8
1
20
6
13
1
25
8
13
1
24
10
24
1
18
10
20
1
17
9
4
2
28
7
14
2
25
14
5
2
26
9
20
2
19
15
22
2
29
14
12
2
15
6
2
2
29
10
5
2
26
11
1
2
22
5
2
2
15
15
14
2
29
6
4
2
15
6
3
3
22
8
12
3
27
9
14
3
21
10
7
3
17
9
1
3
16
7
12
3
19
9
7
3
23
10
1
3
27
9
5
3
23
9
6
3
16
14
22
1. Run the appropriate analysis of the data and interpret the results.
2. How could this study have been done differently? Why or why not would this approach be better?
Discussion 1
Key Decision Criteria for selecting IT Sourcing Option
IT sourcing is a process of choosing or acquiring information technology resources from external sources outside of the organization. While traditionally sourcing was a way to reduce costs, companies see it now more like an investment designed to enhance capabilities, increase agility and profitability, or gain them a competitive advantage (Tome, 2018). IT Managers must consider four different sourcing options which are In-house, Insource, Outsource and Partnership. The following are the four key decision criteria that needs to be considered for selecting the appropriate sourcing option
Flexibility: Flexibility has two key factors which are response time and capability which defines the quickness and range of IT functionality respectively. Insourcing or a permanent IT staff, is also a highly flexible sourcing option. Outsourcing exhibits less flexibility because of the need to locate an outsourcer who can provide the specific function, negotiate a contract, and monitor progress. Partnerships enjoy considerable flexibility regarding capability but much less in terms of response time (McKeen & Smith, 2015).
Control: There are two dimensions in this criterion as well: ensuring that the delivered IT function complies with requirements and protecting intellectual assets. In-housing and Insourcing are ranked high for these f ...
Internal assignment no 1(MBA208) ANIL KUMARANIL KUMAR
The document discusses strategic management and the strategic management process. It outlines 5 key stages in the strategic management process: goal setting, analysis, strategy formation, strategy implementation, and strategy monitoring. It also discusses findings from research that show many organizations fail at executing strategies successfully. Additionally, the document provides details on different types of mergers, including horizontal, vertical, conglomerate, concentric, forward, reverse, and subsidiary mergers, and provides examples of each type.
HR plays an important role in mergers and acquisitions by defining the new organizational architecture and identifying parts that need restructuring. The HR department must conduct an audit to assess what needs to change, and identify methods to renovate architectural components. HR also needs to set clear priorities like promoting teamwork and implementing pay-for-performance programs. During strategic evaluations, HR should provide data on its return on investment and be rated by customers to assess how its initiatives support business strategy goals.
This document discusses why project managers need to understand their organization's strategy and strategic management processes. It provides three key reasons:
1. Project managers need to understand strategy to make appropriate project decisions and adjustments based on whether the organization prioritizes innovation, cost efficiency, speed to market, etc.
2. Project managers must be able to advocate for their projects and explain how each project contributes to the organization's mission and strategy to gain support from senior management.
3. Strategic management involves reviewing the organization's mission, analyzing external and internal factors, formulating strategies, setting objectives, and implementing strategies through projects. It provides focus and consistency across all levels of the organization.
This document discusses developing an effective employee engagement strategy. It outlines that an engagement strategy should be created before conducting an engagement survey and should detail how the strategy will be communicated, how action areas will be identified from survey results, what measurable outcomes will be used to evaluate progress, what specific actions will address survey findings, and how the strategy will be sustained over time. Identifying drivers of engagement that can be realistically addressed given available resources is important for focusing improvement efforts.
A Study On Business And Technology Strategy In Achieving Business Objectives.Amy Cernava
This document discusses the importance of linking business and technology strategies. It presents a framework that begins with establishing objectives and identifying core technologies and competencies. The framework then shows how to develop an integrated business and technology strategy by deciding which technologies support objectives, comparing strengths/weaknesses to competitors, setting priorities, and determining strategic actions. The document emphasizes that technology is now essential to business functions and firms must adapt their strategic processes accordingly.
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1. Chapter 1: Introduction
Background of the Study
Poised to become a US$ 225 billion industry by 2020, the Indian information technology (IT)
industry has played a key role in putting India on the global map. The IT & the IT-BPO sectors
have become the most significant growth catalysts for the Indian economy. In addition to
fuelling India‘s economy, this industry is also positively influencing the lives of its people
through an active direct and indirect contribution to various socio-economic parameters such as
employment, standard of living and diversity. The industry has played a significant role in
transforming India‘s image from a slow moving bureaucratic economy to a land of innovative
entrepreneurs and a global player in providing world class technology solutions and business
services, according to National Association of Software and Service Companies (NASSCOM)
2011 report.
In an increasingly globalised economy, significant complexity and uncertainty is getting attached
to the unprecedented economic crisis. The Indian economy has also been impacted by the
recessionary trends, with a slowdown in GDP growth to seven per cent. The focus and
exponential growth in the domestic market has partially offset this fall and insulated the country,
resulting in net overall momentum. The IT-ITeS industry in India has today become a growth
engine for the economy, contributing substantially to increases in the GDP, urban employment
and exports, to achieve the vision of a ―young and resilient‖ India. During the year 2011-12, the
sector maintained its double digit growth rate and was a net hirer. This growth has been fuelled
by increasing diversification in the geographic base and industry verticals, and in the
service offerings portfolio. While the effects of the economic crisis are expected to linger in the
near term future, the Indian IT-ITeS industry has displayed resilience and tenacity in countering
the unpredictable conditions and reiterating the viability of India‘s fundamental value
proposition. Consequently, India has retained its leadership position in the global sourcing
market.
Rapid globalization, diversification, and intense competition have resulted in a more dynamic
and complex world. Corporations have to increase agility in a way in which their business units
across geographies operate and collaborate seamlessly across people, processes and technology.
1
2. Definition of Strategic management
Strategic or institutional management is the conduct of drafting, implementing and evaluating
cross-functional decisions that will enable an organization to achieve its long-term objectives. It
is the process of specifying the organization's mission, vision and objectives, developing policies
and plans, often in terms of projects and programs, which are designed to achieve these
objectives and then allocating resources to implement the policies, and plans, projects and
programs.
Strategy can neither be formulated nor adjusted to changing circumstances without a process of
strategy evaluation. Whether performed by an individual or as part of an organizational review
procedure, strategy evaluation forms an essential step in the process of guiding an enterprise.
For executives, strategy evaluation is simply an appraisal of how well a business performs. Has it
grown? Is the profit rate normal or better? If the answers to these questions are affirmative, it is
argued that firm‘s strategy must be sound. Despite its unassailable simplicity, the line of
reasoning misses the whole point of strategy- that the crucial factors determining the quality of
long term results are often not directly observable or simply measured, and that by time strategic
opportunities or threats do affect operating results, it may be too late for an effective response.
Thus strategy evaluation is an attempt to look beyond the obvious fact regarding the short term
health of a business and appraise instead those more fundamental factors and trends that govern
success in the chosen field of endeavor.
Building Support for the Strategic Plan: Aligning Employees with Strategy
One of the most common difficulties companies face in strategic planning is turning their vision
into a reality. To transform your organization into the one you envision takes more than great
strategy and implementation, you also need to make the strategy an integral part of the very fiber
of your organization. When we speak of this idea, we usually use the phrase "strategic
alignment". Aligning everyone in your organization with your strategy is one of the most
important things you can do beyond formulating and implementing great strategies. Alignment
will make it much easier for your management team to push the organization in the direction you
intend. Without good alignment with the strategy, every step forward will be a struggle.
2
3. How do we get this alignment?
There are five basic steps that you must take to assure your employees are aligned with your
company's strategies.
First, employees must have the conceptual tools required for good strategic thinking about their
work. This is because employees must be capable of making decisions with strategic impact in
order to be aligned with the company's strategy. Anything less than this calls for a strategy that
treats people as machines.
Second, employees must understand the strategy, understanding the strategy, can only happen if
employees have the conceptual tools covered in the previous paragraphs. This is mostly
necessary because good strategy requires focus. There are three main ways to satisfy customers:
price, quality (in the broad sense, including product features, technology, packaging and a host of
other value-adding features), and service (again, in a broad sense, including delivery, support,
etc.).
Third, strategic alignment needs to be built around the structure of the organization.
Fourth, strategy must be reflected in the structure of individual jobs - especially those in critical
areas. . It's very important that the way you hire, train, compensate and retain the employees you
have in key strategic areas works with your strategies. If you target commodity customers, for
example, you definitely want all these things to reflect your commodity orientation. For example,
in your hiring you want to be hiring people with an eye towards the fact that they might be
driving costs up or down through their skills.
Fifth, you must have buy-in to the strategy. If you have an employee who thinks the strategy isn't
good, you won't have alignment no matter what you do. The first two items, tools and
communication, will go a long way towards getting buy-in, but there are people who just won't
buy into some strategies - especially if they are smart.
Purpose of the study:
The study on the landscape of IT industry gives us a better insight on the competitiveness of IT
industry in India, which has been a major contributor in the GDP. The main purpose of the study
is to analyze the strategy followed by successful IT companies and the drivers which have led to
3
4. the success It also helps us to understand how well the employees are aware of their companies‘
strategies.
Research Objectives:
The study has the following general objectives:
1. To study the landscape of IT industry in India.
2. To analyze the perception and level of awareness of the employees about the strategy of
the company.
3. To identify the perception and awareness level of the employees about the key factors of
success of the company.
Scope of the project:
The study was conducted at Parinathi consulting. The questionnaire was circulated to the
employees of the market leader in the IT service sector- TCS. The responses of employees at
different level in the organization are obtained and it is analyzed. As per the relevance only areas
like generic business strategies, corporate strategies, global strategies and the key factors that
differentiates TCS from other IT companies functioning in India are identified and their
contribution to the revenue is studied.
Significance of the study:
This study gives a better insight towards the IT industry scenario present in India. This Strategy
evaluation can take place as an abstract analytic task. Most often it is an integral part of
organization‘s processes of planning, review, and control. As process, strategy evaluation is the
outcome of activities and events that are strongly shaped by the firm‘s control and reward
systems, its information and planning systems, its structure, and its history and particular culture.
This study explores the factors which have led to the success of the company. After reviewing
the existing literature few dimensions were selected, whose impact on the company‘s success is
measured. Determination of the elements and factors that contribute to the success can help to
formulate a model to provide insight to the focus areas for future use
4
5. Basic Assumptions:
Subjects respond honestly to the questions in spite of potential concerns they regarding
confidentiality of responses.
Market conditions are very dynamic and hence it is assumed that the key factors for
success in the past shall hold good for future also.
There is always a risk factor associated in letting out the critical information to the
outsiders.
Companies‘ top management share their strategies and plans with their employees.
There may be some sampling errors.
Limitations:
There is a possibility that participants may not respond due to the concerns about the
privacy or Confidentiality of their responses.
Employees may be hesitant to talk about their experience in the company due to the fear
of adverse possible consequences
Inherent biases may be present.
Time is a constraint due to the duration specified in the course curriculum
The study will be done on a small scale, with a sample size of 50 due to time constraint.
There is a chance of misinterpretation due to the small size of the sample viz-a-viz the
population.
The sample may not be representative of the entire population.
5
6. Chapter 2: Literature Review
Strategy evaluation is the appraisal of plans and the results of plans that centrally concern or
affect the basic mission of an enterprise. Its special focus is the separation between obvious
current operating results and the factors that underlie success or failure in the chosen domain of
activity. It results in rejection, modification, or ratification of existing strategies and plans.
It is usual to view strategy evaluation as an intellectual task. From this point of view, there are
four essential tests a strategy must pass. According to Prof. Richard P. Rurnelt (Anderson
School, 1999-1.3) the strategy must (1) be internally consistent, (2) provide for consonance
between the firm and its environment, (3) be based on the gaining and maintenance of
competitive advantage and (4) be feasible in the light of existing skills and resources.
As per The Science of Strategy Evaluation, TradeStation Technologies., Strategy evaluation is
not an art, it is a science. There is a clear procedure with a definite range of acceptable results.
Once you have delineated your acceptable limits for the evaluation, the analysis should become
routine. When your results move out of this acceptable range, the strategy becomes suspect.
Early detection of a failed strategy is as important to long-term profitability as the design of the
strategy itself.
Strategy formulation
It is clear that a poor or vague strategy can limit implementation efforts dramatically. Good
execution cannot overcome the shortcomings of a bad strategy or a poor strategic planning effort
(Hrebiniak, 2006). Several studies mention the fact that the kind of strategy that is developed
(Alexander, 1985; Allio, 2005) and the actual process of strategy formulation, namely, how a
strategy is developed (Kim & Mauborgne, 1991, 1993; Singh, 1998) will influence the effect of
implementation. Alexander (1985) believes that the need to start with a formulated strategy that
involves a good idea or concept is mentioned most often in helping promote successful
implementation. As Allio notes, good implementation naturally starts with good strategic input:
the soup is only as good as the ingredients (Allio, 2005).
The central conclusion of the research of Kim & Mauborgne (1991) is that the procedural justice of
the strategy formulation process ultimately affects the commitment, trust, and social harmony as well
as the outcome satisfaction of managers in subsidiaries. Procedural justice provides a potentially
6
7. useful but still unexplored way to mobilize a multinational‟s global network of subsidiaries. Kim &
Mauborgne (1993) point out that a subsidiary‟s top managers want an open process, that is consistent
and fair, and that allows for their input to be heard. In the presence of a so-called due (or open)
process, subsidiary managers are motivated to implement global strategies. They feel a strong sense
of organizational commitment, trust in head office management, and social harmony with their head
office counterparts. In the absence of such a due and fair process, the effect may be the opposite from
the intended one (ibid).
Relationships among different units/departments and different strategy levels
Several studies treat institutional relationships among different units/ departments and different
strategy levels as a significant factor that affects the outcome of strategy implementation (Walker
& Ruekert, 1987; Gupta, 1987; Slater & Olson, 2001; Chimhanzi, 2004; Chimhanzi & Morgan,
2005). Walker & Ruekert (1987) divide business strategy behaviors into three types: prospectors,
differentiated defenders and low cost defenders. These distinctions are based on the strategy
categories introduced by Miles & Snow (1978; prospectors, defenders, analyzers, reactors) and
by Porter (1980; overall cost leadership, differentiation and focus). Walker & Ruekert stipulate
that corporate-business unit relationships, inter-functional structures and processes, marketing
policies and processes may all significantly influence business strategy implementation. Three
aspects of the corporate-business unit relationship are especially likely to affect a unit’s success
in implementing a particular strategy: business unit autonomy, sharing programs and synergies
across SBUs, as well as control and reward systems. In addition, functional competencies,
allocation of resources, decision-making participation and influence, inter-functional conflict and
coordination may have vastly different effects on the implementation of different kinds of
strategies. Walker and Ruekert also assume that decision-making and coordination structures in
the marketing department, and marketing policies and programs within the business unit, affect
the performance of different business strategies in different ways,
Chimhanzi (2004) suggests that cross-unit working relationships have a key role to play in the
successful implementation of marketing decisions. Implementation effectiveness is affected
negatively by conflict and positively by communication and specifically, interpersonal, not
written. In turn, these interdepartmental dynamics are affected by senior management support,
joint reward systems, and informal integration. Chimhanzi (2004) also points out that the
7
8. marketing and R&D interface remains the most extensively researched dyad within the specific
context of the new product development (NPD) process. Chimhanzi provides a multitude of
references to such studies in his 2004 article. Other relationships that have received empirical
attention, albeit to a lesser extent, include marketing, and accounting, finance, manufacturing,
engineering, quality, and sales. There are also those studies, according to Chimhanzi, that have
not focused on dyadic and multiple relations, but rather on marketing as the only one of many
departments within a network of relationships. Chimhanzi & Morgan‟s (2005) findings indicate
that firms devoting attention to the alignment of marketing and human resources are able to
realize significantly greater successes in their strategy implementation. Specifically, these
findings imply that marketing managers should seek to improve the relationship with their HR
colleagues by emphasizing two of the process-based dimensions: joint reward systems and
written communication.
Executors
Executors are comprised of top management, middle management, lower management and non-
management. Effectiveness of strategy implementation is, at least in part, affected by the quality
of people involved in the process (Govindarajan, 1989). Here, quality refers to skills, attitudes,
capabilities, experiences and other characteristics of people required by a specific task or
position (Peng & Litteljohn, 2001). Viseras, Baines, and Sweeney (2005) group 36 key success
factors into three research categories: people, organization, systems in the manufacturing
environment. Their intriguing findings indicate that strategy implementation success depends
crucially on the human or people side of project management, and less on organization and
systems related factors. Similarly, Harrington (2006) finds that a higher level in total
organizational involvement during strategy implementation had positive effects on the level of
implementation success, firm profits and overall firm success. Next to these overall findings
regarding the ―who‖ of strategy implementation, we will now review the individual groups of
strategy executors at different hierarchical levels.
Communication
Forman and Argenti (2005) rightly note that, ―although an entire discipline is devoted to the
study of organizational strategy, including strategy implementation; little attention has been
given to the links between communication and strategy.‖ But Forman and Argenti also note that
8
9. business communication researchers have become increasingly interested in the contribution of
corporate communication to a company’s ability to create and disseminate its strategy in the
last decade. However, very few authors have investigated the link between corporate
communication and strategy, and – when they have – their focus has primarily been on how
corporate communication affects the firm’s relationship with its various stakeholders. At least,
numerous researchers have already emphasized the importance of communication for the process
of strategy implementation (Alexander, 1985; Rapert & Wren, 1998; Peng & Litteljohn, 2001;
Heide & Grønhaug & Johannessen, 2002; Rapert & Velliquette & Garretson, 2002; Forman &
Argenti, 2005; Schaap, 2006). That research in this area is needed is emphasized by an older
finding by Alexander from 1985: Based on interviews with 21 presidents and 25 governmental
agency heads, Alexander (1985) points out that communication is mentioned more frequently
than any other single item promoting successful strategy implementation. The content of such
communications includes clearly explaining what new responsibilities, tasks, and duties need to
be performed by the affected employees. It also includes the why behind changed job activities,
and more fundamentally the reasons why the new strategic decision was made firstly.
Rapert and Wren (1998) find that organizations where employees have easy access to
management through open and supportive communication climates tend to outperform those
with more restrictive communication environments (cited in Rapert, Velliquette and Garretson,
2002).
Also the findings of Peng and Litteljohn (2001) show that effective communication is a key
requirement for effective strategy implementation. Organizational communication plays an
important role in training, knowledge dissemination and learning during the process of strategy
implementation. In fact, communication is pervasive in every aspect of strategy implementation,
as it relates in a complex way to organizing processes, organizational context and
implementation objectives which, in turn, have an effect on the process of implementation.
Communication barriers are reported more frequently than any other type of barriers, such as
organizational structure barriers, learning barriers, personnel management barriers, or cultural
barriers. Heide, Grønhaug and Johannessen‟s (2002), for example, indicate that there are various
types of communication problems (without specifying what they are). These communication issues
may be influenced to some extent by the organizational structure. According to Heide, Grønhaug and
9
10. Johannessen, they constitute the key barrier to the implementation of planned strategic activities.
Rapert, Velliquette & Garretson (2002) state that communication and shared understandings play an
important role in the implementation process. In particular, when vertical communication is frequent,
strategic consensus (shared understanding about strategic priorities) is enhanced and an
organization’s performance improves. They explore vertical communication linkages as a means by
which strategic consensus and performance can be enhanced.
The study of Schaap (2006), which was conducted in the casino industry within the state of Nevada,
shows that over 38 percent of the senior-level leaders do not communicate the company‟s direction
and business strategy to all of their subordinates. This study also reinforces findings that frequent
communication up and down in organization enhances strategic consensus through the fostering of
shared attitudes and values.
The corporate communication function is the department or unit whose purpose is facilitate strategy
implementation through communication (Forman and Argenti, 2005). This department can also serve
as the „antenna‟ of an organization, receiving reactions from key constituencies to the strategy of the
firm. Forman and Argenti (2005) find that the alignment between the corporate communication
function and the strategic implementation process was particularly visible in those companies that
were going through fundamental strategic change: ―All of the firms studied were involved in
significant efforts in internal communications and felt that IT was central to the success of the
function, particularly in terms of implementing strategy and building reputation‖ (Forman and
Argenti, 2005).
Implementation tactics
Nutt (1986, 1987, 1989), Bourgeois Ш & Brodwin (1984), Lehner (2004), Sashittal & Wilemon
(1996), Akan & Allen & Helms & Spralls Ш (2006) research the effects of implementation
tactics on strategy implementation. Nutt (1986) identified four types of implementation tactics
used by managers in making planned changes by profiling 91 case studies: intervention,
participation, persuasion, and edict. The study found a 100 percent success rate when key
executives used an intervention tactic, but observed this tactic in less than 20 percent of the
cases. Both the persuasion and participation tactics had 75 percent success rates; persuasion had the
highest frequency of use, 42 percent, and participation the lowest, 17 percent. Implementation by
edict had a 43 percent success rate and a 23 percent frequency of use. Nutt (1987) explains the four
10
11. tactics as follows: Intervention refers to strategy adjustments during the implementation stage by
introducing new norms and practices. Participation consists of articulating strategic goals and
nominating a task force that develops and proposes corresponding implementation options.
Persuasion consists of the tactic of using the involved parties to convince employees about the
decided course of actions. The main mechanism for implementation in the edicts tactics (that relies
on power and is characterized by absence of participation) is the issuing of directives. In another
study by Nutt (1987), intervention, participation, persuasion, and edict were found to describe over
90 percent of the tactics used by strategic managers. The analysis revealed that these four
archetypical tactics were used almost exclusively. An „interventionist‟ approach had the best results,
but was used in only one case in five. „Persuasion‟ and „participation‟ were the next most effective
tactics, whereas „edict‟ was least effective one. Nutt (1989) set up a contingency framework that
uses situational constraints, such as a manager‟s freedom to act and need for consultation. It was
developed to select among tactics preferred by practitioners. Case studies of strategic planning were
used to test the framework, finding that a high proportion of failures applied implementation tactics
that differed from those recommended by the framework. A 94 percent success rate was observed
when recommended tactics were used, compared to a 19 percent success rate when non-
recommended tactics were used. The framework seems particularly useful in identifying conditions
under which participation, persuasion and edict tactics could be profitably used.
Bourgeois Ш and Brodwin (1984) examine five process approaches used to advance strategy
implementation: Commander model, Change model, Collaborative model, Cultural model, Crescive
model. The first approach addresses strategic position only, and should guide the CEO in charting a
firm‟s future. The CEO can use economic and competitive analyses to plan resource allocations to
achieve his goals. The change model emphasizes how the organizational structure, incentive
compensation, control systems and so forth can be used to facilitate the implementation of a strategy.
The collaborative model concentrates on group decision-making at a senior level and involves top
management in the formulation process to ensure commitment. The fourth approach tries to
implement strategy through the use of a corporate culture. The final approach draws on managers‟
inclinations to want to develop new opportunities as see them in the course of their day-to-day
management. The first three models assume implementation as after-the-fact. This implies that the
number of strategy developers is few and that the rest of the organization is somehow manipulated or
cajoled into implementation. For the latter two models, most of the energy is used for strategy
11
12. formulation and the strategy requires relatively little effort in its implementation. Lehner (2004) takes
implementation tactics as genuine organizational behavior based on the assumption that
implementation in general is dependent on the environment, and various strategic and organizational
variables. He views the study of Bourgeois Ш and Brodwin (1984) as the first attempt to explicitly
link behavioral patterns to the context of strategic management. These patterns are referred to as
implementation tactics. However, Lehner (2004) believes that Bourgeois Ш and Brodwin did not
successfully link their concept of tactics to other conceptualizations of organizational behaviors,
especially with regard to organizational leadership, nor did their framework lead to any empirical
studies. On the basis of the study of Bourgeois and Brodwin (1984), Lehner (2004) proposes five
implementation tactics: command, change/politics, culture, collaboration and crescive/market.
Command and politics/change are both somewhat autocratic. They can be subsumed under the label
―tell/sell‖ (a term borrowed from Locke/Latham, 1990 cited in Lehner, 2004). In contrast, both
collaboration and the market as implementation tactics utilize participation to a high degree and in a
way which gives subordinate groups a strong voice. It also gives them the possibility to influence the
selected courses of action. Only culture as an implementation tactic remains as a single category,
which forms an independent dimension by being close to transformational leadership (Bass, 1985,
cited in Lehner 2004).
Commitment
Shared understanding without commitment may result in ―counter effort‖ and negatively affect
performance (Wooldridge & Floyd, 1989, cited in Rapert, Lynch and Suter, 1996). Some authors
take shared understanding as a commitment. MacMillan & Guth (1985) and McDermott & Boyer
(1999) all think that the shared understanding of middle management and those at the operational
level to the top management team‟s strategic goals is of critical importance to effective
implementation (Rapert & Velliquette & Garretson, 2002). Strategy implementation efforts may
fail if the strategy does not enjoy support and commitment by the majority of employees and middle
management. This may be the case if they were not consulted during the development phase
(Heracleous, 2000). Alexander (1985) thinks obtaining employee commitment and involvement can
promote successful strategy implementation (on the basis of telephone interviews with CEOs). Some
CEOs believe that one way to accomplish this is to involve employees and managers right from the
start in the strategy formulation process. Involvement and commitment should also be developed and
maintained throughout the implementation process. If middle and lower level managers and key
12
13. subordinates are permitted to be involved with the detailed implementation planning, their
commitment will be likely to increase. Guth & MacMillan (1986) suggest that there are three
fundamentally different sources of low to negative individual manager commitment to implementing
a particular strategy: low perceived ability to perform successfully in implementing that strategy; low
perceived probability that the proposed outcomes will result, even if individual performance is
successful; low capacity of the outcome to satisfy individual goals/needs. Middle managers with low
or negative commitment to the strategies formulated by senior management create significant
obstacles to effective implementation.
Noble & Mokwa (1999) put forward three dimensions of commitment that emerged as central
factors which directly influence strategic outcomes: organizational commitment, strategy
commitment and role commitment. Organizational commitment is defined as the extent to which
a person identifies with and works toward organization-related goals and values (e.g., Michaels
et al., 1988, cited in Noble and Mokwa, 1999). Strategy commitment is defined as the extent to
which a manager comprehends and supports the goals and objectives of a marketing strategy.
Role commitment is defined as the extent to which a manager is determined to perform his
individual implementation responsibilities well, regardless of his beliefs about the overall
strategy. The primary dependent variable in Noble and Mokwa‟s (1999) study is implementation
success, which they define as the extent to which an implementation effort is considered
successful by the organization. At the individual level, role performance is a critical outcome
which they define as the degree to which a manager achieves the goals and objectives of a
particular role and facilitates the overall success of the implementation effort. Noble and
Mokwa‟s findings suggest that an individual manager‟s implementation role performance will
influence the overall success of the implementation effort. Both, strategy commitment and role
commitment, were shown to influence role performance. However, the most commonly studied
dimension, organizational commitment, showed no relationship to role performance in either of
their samples. Their results highlight the complexity of the commitment construct and stress that
the study of commitment to an organization alone does not explain this complicated variable fully.
13
14. Fig 2.1 : The strategy implementation framework by Okumus (2001)
Key * New implementation variable
1. The characteristics of and developments in, the external environment influence the strategic
context and force the companies to develop new initiatives
2. The problems and inconsistencies in the internal context require new projects
3. The project is implemented in the internal context and the characteristics of, and changes in,
the context variables influence the process variables
14
15. 4. All the process variables are used on a continuous basis
5. (a) The characteristics of, and changes in, the external and internal context have impacts on
the outcomes; (b) The characteristics of the process variables, and how they are used, determine
the outcomes of the project implementation
Communicating Your Strategic Plan with Employees Robert W. Bradford
It's critically important that employees understand your strategy. Employees who understand
your strategy will be able to make better day-to-day decisions that will support your vision. But,
while most of us understand this — at least intellectually — we often have difficulty effectively
communicating our strategies to people outside of the strategic planning team. This may be
especially difficult if you feel that parts of your strategy are sensitive and should not be shared
with people outside of your management team. In addition, it may be undesirable to load
employees with the task of thoroughly understanding all of your strategic planning documents
when many employees only touch on one small operational area. How can we reconcile these
difficulties?
In Bradord‘s experience, companies that share their strategy with their employees get far greater
alignment with their vision. This makes implementation much easier, and helps to give your
vision a life of its own. If you want to get all of your employees — and not just your planning
team — helping to move your vision forward, try communicating your strategy with them this
week!
Robert Bradford is President of Center for Simplified Strategic Planning, Inc.
Align Employees with the Corporate Strategy
As your business emerges from the recession, it should have a measurable competitive advantage
strategy in place. And don't forget to enlighten your workers
By The Staff of the Corporate Executive Board
In the wake of economic uncertainty, many companies are re-inventing their businesses to not
only survive the downturn, but to emerge with a measurable competitive advantage in the
recovery. In many companies, products suites are rethought, brand identities are unmistakably
changed, go-to-market strategies are redesigned for greater efficiency, resources and funding are
slashed, and the workforce is restructured for streamlined operations.
15
16. For some companies, these strategic changes in response to the broader economic environment
have represented major shifts in the way they do business, while others have experienced more
moderate tweaks to their strategy. Yet there are virtually no organizations with the luxury of
remaining untouched by the economic turmoil.
How can companies gain a competitive advantage when their employees' are focused on changes
and productivity is on the decline? CEB has identified that companies need to align their
employees with the corporate strategy. Progressive companies that successfully align employees
to their corporate strategy are realizing the competitive advantages originally targeted in
organizational transition.
• Refocusing on the customer? Companies in the service industry are realizing 10% gains in
customer satisfaction.
• Launching new products? Measurable levels of innovation have been documented to improve
by 15%.
• Trying to be more nimble in the market place? Employee perception of organizational speed
has been cited to increase by upwards of 35%.
• Aligning employees to the corporate strategy—helping them understand their new call to
action—is a critical driver of success in today's market.
16
17. Chapter 3: Research methodology
Research Questions
The main questions that this research hopes to answer are:
1. What is the perception and level of awareness of the employees about the strategy of the
company?
2. What are the key factors of success of the company based on the perception and
awareness level of the employees?
Research Approach
The first phase was descriptive, which was used to collect data and gain an in-depth
understanding of the IT industry in India, strategy of the market leader TCS from the available
data.
The second phase was exploratory and quantitative, involving the analysis of survey data to test
the research hypotheses. A qualitative research approach can be particularly helpful in
interpreting the results by explaining the causes behind related variables.
Exploratory research is conducted to clarify and define the nature of the problem. It is used to
diagnose a situation, screening of alternatives and discover new ideas. With the company
executives were also conducted to obtain the details about their awareness level on the company.
Reasoning
The study uses Deductive reasoning, to verify the data collected on the environment and the
compatibility of the employees with the organization environment.
Data Collection
The study was conducted among the group of employees of TCS, Bangalore
Primary data is collected mainly by sending the questionnaires to their email id and their
responses were recorded.
Secondary data on the strategy followed by TCS is collected from published journals,
articles, websites, and annual reports.
The sampling size for the engagement survey was 50.
The sampling techniques used to obtain participants for the survey were:
17
18. -Snowball sampling: Participants in the survey were asked to recommend other
employees from their respective departments to take part in the interview.
-Convenience sampling: Based on factors such as work schedule, availability and
proximity of work location, employees were selected for the survey interview.
Questionnaire design
In the questionnaire, positive organizational language was used in place of negatively worded
questions in order for the items to measure engagement and not burnout. The questionnaire was
divided into three sections:
Section 1: The purpose of this section was to obtain demographic and work-life details of the
participants such designation, vertical of the company they are working in, tenure with the
company, and department.
Section 2: The second section consisted of 10 questions to check their awareness level on the
strategy, concepts like MBO, and communication channels in the organization.
Section 3: This section aims in finding key success factors of TCS.
Analysis of Data:
First of all thorough literature was reviewed about the IT industry in India, starting from its entry
till the present scenario and future trends based on Industry reports and other reports. Based on
the market share in IT industry based on revenue, sales, no of employees, TCS emerged as the
market leader and it was selected for analysis. The strategy of TCS was studied based on its
annual reports, corporate sustainability reports and chairman‘s message of over 3 years. Then a
questionnaire was designed to check to check its awareness level among the employees and it
was circulated. After gathering sufficient data about factors causing the employee awareness on
the strategy of the company and the contextual data around each factor. The data is categorized
and produced a relative importance rating for each factor resulting in employee awareness and
causing satisfaction to work in the company
18
19. Survey Administration:
The instrument used to collect data was a questionnaire (Appendix A), which was administered
sent to their emails. The questionnaire consisted of The questionnaire consisted of statements
based on the dimensions to be studied, rated on a fivepoint Likert scale from Strongly Agree to
Strongly Disagree, along with other closed ended questions.
Framework of the study:
Study the IT industry scenario in India
Identify the market leader
Study the strategy followed and
analyze it
Check the awareness level in the
employees
Find out the key success factors of the
market leader
Source: Research data
19
20. Chapter 4: Introduction to the IT industry:
History of the industry
The birth of the software industry in India began in 1970 with the entry of Tata Consulting
Services (TCS) into the domain of outsourced application migration work. In the late 1960s, the
Tatas (name of a large conglomerate of companies) created TCS as a central service center for
Tata Group companies. A few young MIT-trained Indian professionals were recruited, and a
large computer system was imported. With IBM having been thrown out of India, the concept of
outsourcing application development work had become a necessity for Indian companies.
Utilizing its excess computer capacity, TCS began doing outsourced application work for
organizations such as Central Bank of India and Bombay Telephones. Within a few years TCS
began sending young Indian engineers to a joint venture partner in the United States, Burroughs,
for training. The trainee engineers excelled at doing platform conversions, and TCS started
earning conversion assignments for its engineers in Germany and elsewhere.
Later a new company named Tata-Burroughs was formed. Tata was keen to exploit the personnel
placement or ―bodyshopping‖ opportunities whereas Burroughs was interested in selling
hardware to the Indian market. After a few successful years the partnership was broken at the
behest of Unisys which had by then acquired Burroughs in the United States and the company
was rechristened as Tata Information System Limited. A U.S.-trained Indian electrical engineer
took over management of TCS in 1969. He used his influence in the Institute of Electrical and
Electronics Engineers to further promote TCS and founded the Computer Society of India with
fellow scientists and professionals from the Tata Institute of Fundamental Research. Many of
these professionals later moved to government and became very influential policymakers. These
early networks played a very useful role in overcoming severe administrative and procedural
constraints in India‘s otherwise closed economy during the 1970s and 1980s. Following the
success of TCS, many other companies were set up in India.
Beginning in the 1970s, a growing shortage of engineers for the expanding computer industry in
the United States and Europe, an oversupply of Indian engineers relative to domestic demand,
and a growing international reputation for the skills of Indian engineers, provided an opportunity
for bodyshopping in which Indian firms such as TCS sent Indian engineers overseas to do
20
21. software programming onsite, mostly in American firms for limited, billable projects.
During the first phase (1968–84) of exports, four types of companies interlinked in direct and
indirect ways to facilitate bodyshopping (Xiang Biao 2002). 1) There were established
companies in India such as TCS and Infosys Technologies which supplied programmers to large
multinationals in IT and non-IT sectors primarily in the United States. These multinationals also
recruited programmers through local U.S. companies such as Mastech (now iGate) and
Information Management Resource established by Indians living in the United States. Such
companies in turn recruited manpower through local search agents (small companies run by
Indians in the United States). These agents, from several states in the United States, would
contact local agents in India from a multitude of small companies and operators. The
responsibility of collecting resumes, forwarding them to U.S. placement agents, preparing visa
and contract finalization with the programmers was done by the agents in India. The
programmers were paid low wages. Commissions were charged by different members of the
supply chain. Sometimes there were subagents spread in different towns and cities in India.
There was an interesting network among revolving players. Programmers who returned to India
after a stint overseas would join the pool of software engineers who could be hired by the
established companies in India. Often, programmers sent onsite by large Indian companies would
move laterally to another assignment in the United States through a local U.S. agent to prolong
their U.S. experience. Later they would return to India and be in the market for local Indian
agents to hire them. The Indian Diaspora had played a key role in the bodyshopping exports.
Arora and others (2001) also report several instances where Indian immigrants in the United
States helped U.S. buyers to locate Indian suppliers. Field interviews with U.S. customers
reported that the impetus for outsourcing to India came from employees of Indian origin.
The development of body shopping links between firms in the United States and India was due
mainly to the large Indian Diaspora in the United States, many of whom worked as professionals
in the American IT industry. They promoted and facilitated connections between U.S. firms and
firms or agents in India who could supply programmers for onsite work in the United States. The
successful growth of bodyshopping was due to the skills of Indian entrepreneurs and the steady
supply of low cost and trainable Indian engineers. Bodyshopping was and continues to be an
21
22. attractive strategy for new entrants into the industry, requiring nothing more than knowledge and
established relations with a few potential clients.
The severe shortages in skilled technical labor for the growing IT industry in the West and the
liberal immigration policies of the United States fueled the emergence of bodyshopping. For
example, in the 1990s annual growth of IT expenditures on equipment in the United States was
24 percent and in Germany and Britain just under 20 percent. At the end of the 1990s the
shortage of programmers, systems analysts, and computer engineers was estimated at about
346,000 in the United States and 30,000 in Canada.
The growth of IT industry:
Over the course of its history, the Indian IT industry has been through a number of phases (see
Figure below starting with extremely low value-add body-shopping work to doing high-end
consulting today. Currently, the industry is characterized by the presence of a few very large
companies with a couple of billion dollars in turnover, each employing in excess of 50,000
people. The majority of these companies provide outsourced services to their overseas clients.
These services include maintenance of existing software, development of new software, remote
infrastructure management, product design and development and increasing amounts of IT and
business consulting
.
Fig 4.1: Phases in Indian IT sector
22
23. The Indian IT sector has been the subject of many studies that have attempted to identify some of
the several factors responsible for the incredible growth of this sector. Rafiq Dossani has traced
the origins and growth of the industry. The most comprehensive treatise of the sector‘s growth,
aptly titled ―The Long Revolution‖ has been chronicled by journalist Dinesh C. Sharma. Some of
the key factors that many of these studies have listed out are:
Demographic factors. India is possesses a demographic advantage over other nations by virtue
of its
very large pool of English speakers
large pool of scientists and engineers,
young populace entering the job market,
cost benefits
Government Policy Reforms Despite many assertions to the contrary, the sector has received
substantial help from the government both by easing-up on regulations as well as other measures
(tax-exemptions) which have gone a long way.
Economic Liberalization The sector has also benefited from the larger opening up of the Indian
economy, for example, de-regulation of the telecom industry, easing of FDI norms, reduction of
duties on computers and electronic devices etc.
The era of outsourcing
While initial development of India's software industry was based primarily on bodyshopping
work onsite at U.S. firms, in recent years the trend has been increasingly for Indian firms to
conduct software development for U.S. clients ―offshore‖ in India. This shift was the result of a
maturing of India's software industry and its international reputation in the last 15 years, and the
development of necessary infrastructure and communications technologies in India that has made
offshore work possible.
As the Indian software industry matured, increasing client confidence in Indian capabilities and
quality standards enabled Indian firms to move their work offshore. With maturity has come a
goal to move up the value chain. Many new companies were set up in the 1980s by entrepreneurs
with ambitions of creating world-class software development centers. Firms which had started
primarily as subcontractors for technical manpower gradually shifted to managing complete parts
23
24. or phases of projects, and then to delivering complete solutions from India. During this phase,
most companies made significant efforts to assimilate good practices in project management and
quality and to acquire internationally recognized quality standards certification. NASSCOM
played an aggressive role in promoting the India brand abroad. In some ways, during this period,
India was building a launching pad for the eventual take off of its software service industry.
In this period the Indian government played a facilitating role in advancing the industry and
enabling offshore work in India. Recognizing the growth potential of the software industry, the
government in the 1980s took key policy actions to open up the sector. Further policy reforms
enacted since the late 1990s have facilitated development of telecommunications and other
infrastructure required for offshore work. A policy change in 1998 that effectively ended a
monopoly on internet service provider (ISP) gateways, allowed India‘s private sector to offer
needed bandwidth to the growing industry. Two years ahead of the World Trade Organization
(WTO) commitment, India liberalized international long distance in 2002. In 1990 the
government created software technology parks (STPs) in 39 locations across India to provide
software companies with access to high speed data communications and single-window
clearance for regulatory compliance. While few of the larger firms have made use of the STP's,
they have provided opportunities for new firms to launch, and smaller firms to grow, with little
investment.
Table 4 shows the shift in the last 15 years from client sites overseas to ―offshore‖ business in
India. The revenue from services provided in India increased from only 10 percent in 1988, to 33
percent in 1995, to more than 60 percent by 2003–04.
Table 4.1. Comparison of Indian software export revenue by delivery location (percent)
1998– 1999– 2000– 2001– 2002– 2003– 2004–
Type 1988 1995 99 00 01 02 03 04 05
Delivered at overseas
client site 90 66 54.4 57.4 56.0 45.2 43 36 29
Delivered in India 10 33 44.4 43.6 44.0 55 57.3 64 71
Compiled from Kumar (2001: 4,280) [[page 4,280 YES?]] and NASSCOM (2005: 58)
The Indian software industry is now in its third phase – that of take off. Today, most leading
companies are operating in the high-end software services business and are also making efforts
24
25. to enter the products segment. New breeds of companies, led by second generation software
entrepreneurs, are setting up product-oriented companies. The industry has weathered ups and
downs in the global market, maintaining a high rate of growth. The industry moved center stage
in the domestic media because of its visibility in the United States, high market capitalization
and wealth creation for its employees. It is a source of national pride, and as a consequence
continues to attract disproportionate government attention. The government set ambitious
software export targets and has provided the policies to enable the industry to achieve those
targets. Software companies are increasingly being recognized for their leadership in adopting
best practices in management by the media. Indian companies have fine-tuned the ―offshore
model‖ and project their brands as service companies. Companies have moved further up the
value chain, improving productivity, targeting new geographies, vertical domains and businesses.
Tackling the manpower issue: firm-level efforts
Human resource development is critical in software companies where 95 percent have formal
training divisions and learning needs analysis programs. Minimum training per employee is 40
hours. This covers both technical and behavioral training and the proportions vary between
managerial and technical positions.
A 2003 survey by Hewitt Associates and NASSCOM provides insights into recruitment and
training practices (NASSCOM 2004: 189–191). A large proportion of companies spend about
seven percent of total employee costs on recruitment. Nearly 26 percent of the total manpower
requirement is met through campus recruitment of fresh graduates. In fact, nearly 44 percent of
such companies source campus recruits from engineering institutions only. Nearly 17 percent of
the companies also recruit from management campuses. Most companies run large lateral hire
programs which are based on written aptitude and technical tests followed by interviews.
Statistics reveal that among innovations in the software industry, the most significant
interventions have taken place in human resources. For example, nearly 60 percent of
companies have formal employee suggestion systems from which 28 percent of suggestions are
actually implemented. Another study (Bhatnagar and Dixit 2004) of two large organizations
reports how special attention is paid to organizational innovations that meet the challenges of
external and internal imbalances. They suggest that current software service activity has built-in
incentives to innovate up the value chain toward more complex services, software products and
hardware-software integrated products.
25
26. In terms of rewards and recognition, a majority of companies uses market data to determine
basic pay. Employment and wages in the software sector have increased over the last decade
but not enough to erode India‘s competitive advantage. The differential between client
countries and India remains very high (table 8). In terms of competition, countries comparable
to India in overall cost/quality/delivery metrics have significantly higher wages than India.
Moreover, expanded capacity of Indian engineering colleges will ensure that the supply is
adequate for the likely demand in the next five years.
With the entry of many multinationals in the Indian market, there is competition for the best
talent. The top 10 companies reportedly have retention rates over 90 percent indicating a fairly
stable environment. It is interesting that Indian companies are neck-and-neck with
multinationals in these surveys (Dataquest, August 31, 2003), indicating the highly professional
nature of the HRD function in the industry.
Table 4.2 India and her competitors compared
Philippine
Parameter India Canada Ireland Israel s China Russia
Export
Industry 9,500 3,780 1,920 900 640 1,040 165
Size (US$
million)
Export
focused 195,000 45,000 21,000 15,000 20,000 26,000 5,500
professionals
IT employee 5–12,000 36,000 25–35,000 25,000 7,000 9,600 7,000
costs (US$ per
year)
Number of 60 NA 0 0 NA 2 3
CMM-5
certified
companies
Quality of IT High High High to High Moderate Low High
labor force Moderate quality quality
Infrastructure Average Good Good Good Good Average Poor
Unique Abundant and Near shore, Large MNC Large English Large IT High
26
27. positives
skilled (English, highly presence, product skills and workforce quality
highly qualified, compatible early start development cultural engineers
exposed to culture with (shrink compatibility
clients) the United wrapped)
workforce, robust States and experience
project United
management Kingdom
experience
Main
negatives Ordinary High costs High costs Regional Lacks Lacks Unstable
infrastructure unrest project project economy
managers
managers
Source: NASSCOM (2004)
Government's facilitating role
Although the story of the Indian software industry is a story of private initiative, the government
played a supporting role with public funding of a large, well trained pool of engineers and
management personnel who could forge the Indian IT industry into a world class treasure in a
short time. Early government support came from a few visionary civil servants who championed
the cause and helped the industry find its way through a labyrinth of regulations, making
exemptions wherever possible. Later, policies that encouraged local firms and direct foreign
investments were introduced.
Government targeted software exports once the market identified the industry’s potential and
created the necessary institutions. As early as 1972, the Department of Electronics introduced a
policy to permit duty-free imports of computer systems, if importers would promise to export
software and services worth twice the value of the imported computers within a specified time.
This policy helped a number of leading companies in their inception stage. In the 1980s the
Department gave software developers a further boost by initiating software export friendly
policies. It formed a software export promotion council and liberalized import rules for materials
needed for the industry. Software was explicitly targeted as a key sector for export promotion. In
the late 1990s, the government created four major taskforces comprising chief executives of
27
28. leading software companies to study the sector and recommend actions, and then acted on most
of the recommendations.8 At that time the Department of Electronics became the Ministry of
Communication and Information Technology. This was followed by the IT Act to address a large
number of issues. In addition to these federal interventions, many states promoted local software
industry by improving infrastructure, IT education, and provision of more facilitating
environments.
With the beginning of economic reforms in the early 1990s, efforts were , made to attract foreign
as well as domestic investment. Foreign companies were permitted to establish fully owned
subsidiaries in the electronics export processing zones. Within the Ministry of Finance there was
greater recognition of India‘s comparative advantage in the sector, as it abolished entry barriers
for foreign companies, made available fast, low-cost data connection facilities, and reduced and
rationalized duties, taxes, and tariffs.
The Reserve Bank of India adopted several measures to support the IT industry. These included:
simplification of the filing of Software Export Declaration Form (SOFTEX); acquisition of
overseas parent company shares by employees of the Indian company; companies whose
software sales were over 80 percent could grant stock options to nonresident and permanent
resident employees; foreign exchange could be freely remitted for buying services; and
companies which executed contracts in ―computer software‖ abroad could use income up to 70
percent of contract value to meet contract-related expenses abroad.
Tax holidays were given on company profits, although the government is progressively phasing
out these deductions. Tax breaks from corporate income and tax on profits was available to units
in any free trade zone, any software technology park, or any special economic zone to the extent
of 100 percent of the profits derived from the business. These deductions will not available from
Financial Year 2009–2010 onwards.
Indian direct investment in joint venture (JV)/wholly owned subsidiaries (WOS) abroad was
simplified and a fast track window is available for large investments. IT software and services
companies in India can acquire companies overseas through American Depositary Receipt/
Global Depository Receipt stock swaps without prior approval for up to $100 million or ten
times the export earnings of the previous year.
While the government has enacted significant reforms in the area of intellectual property rights
(IPRs), and has joined the World Trade Organization and Trade-Related Aspects of IPRs, the
28
29. reforms have so far not led to a surge in patents in the Indian software industry, nor have IPRs
been perceived as effective in protecting innovations in the Indian software industry (Gupta
2004).
Several policy reforms in the telecom sector helped accelerate the domestic and export industry.
In 1998, a national telecom policy was announced to clarify the role of the regulator, transition
from license fee to a revenue sharing model and open domestic long distance to private
operators. The ISP gateway monopoly ended in 2000 and permitted private companies to set up
international gateways. In 2002, international long distance was liberalized two years ahead of
WTO commitments and competition increased in cellular markets. As a result, India‘s
teledensity, the number of phones per 100 people, increased to five and cellular penetration
overtook the land line penetration.
Recognizing the growing need for manpower in the software industry the Ministry of Human
Resources Development took the following actions:
Helped create and expand computer science departments in existing engineering colleges.
Eased policies in order to enable private sectors to open educational institutions without
public funding. A large number of engineering colleges were opened in the private sector.
Introduced quality control systems for engineering colleges and other IT training
institutions, such as the All India Council for Technical Education and an accreditation
system run by professional bodies such as the Computer Society of India to monitor
private training institutions.
Moving up the value chain
The leading firms have moved up the value chain in software services, developing organizational
and managerial capabilities that enable them to offer more comprehensive services than merely
low cost programming. One sign of maturity is that the industry increasingly procures fixed price
contracts, rather than the time-and-materials contracts of earlier years. With the greater risk of
fixed price contracts comes flexibility in organizing work, greater management control, and an
opportunity to earn higher returns as efficiency improves.
Revenue per worker is increased, indicating a move up the value chain – from an average of
$9,000 in 1995–96 to $20,500 in 2000–01 – but revenues are still lower than what they are in
product-based companies.
29
30. In order to build client value, companies have expanded their capacity to service a wider range of
software development tasks, as well as to move into new services such as product design and
Information Services outsourcing. Software development includes analysis and specification of
requirements, software design, writing and testing of software, and delivery and installation.
Indian companies are trying to move beyond only writing and testing, which require the least
skill and account for only a small portion of the overall project costs, to higher skill levels that
require deeper business knowledge of the industry for which software solutions are being
developed.
In their quest to climb the value chain, India's software firms ensured product quality and
reliability by adopting internationally recognized standardized work processes. An increasing
number of firms have met international certification requirements for key quality standards. For
many, this was an exercise in brand building, but the processes and procedures put in place left
their hallmark on the quality of software products and services.
The reasons for the success of the quality improvements can be grouped in three categories –
people based, business related, and management related (Jalote 2001). The Indian software
industry primarily delivers services, which globally has embraced software process improvement
(SPI) more than those who deliver products. As Indian companies serve worldwide clients who
demand that their vendors adopt standards such as ISO and CMM, companies were motivated to
certify their credentials and used these frameworks to also deliver real software process
improvement. As companies moved to an offshore model, SPI became a necessity to succeed.
Managing subcontracted work typically requires monitoring structures to contain risk. This
imposes a degree of formality at the interface between the users and developers – something that
is generally hard to achieve with in-house development.
For most organizations software development is their core competency which must be
continually improved. Their high growth trajectory required the infusion of a large number of
new engineers every year. Without tightly controlled processes, it would have been impossible to
absorb new recruits into the development process quickly. Since the cost of manpower was not
very high in India, it was possible for most companies to dedicate a team for its SPI effort. A
survey of high-maturity organizations in India indicated that most companies had dedicated
manpower for SPI equal to about 1–2 percent of their engineering manpower (Jalote 2001).
Most of the software companies in India are very young. Being followers in the software
30
31. development process, they could exploit the collective knowledge and experience of
organizations the world over in implementing SPI. Most companies introduced quality systems
very soon after they were formed. This ensured that the company had work standards to which
each new entrant had to conform. After that, the company, people and quality systems all
matured together. As the people in the company have contributed actively to the SPI movements
from the early days, it induced among the practitioners a sense of ownership for the quality
system.
Software companies attract the best of talent from engineering schools. Some of the CMM lead
assessors have observed that the scores on the Myers-Briggs personality tests conducted as part
of the capability appraisals often indicate that Indian engineers are different from their
counterparts in the United States. Indian employees are ambitious and look for improvement in
the way the organization works, which creates a need for process orientation. The average age of
the Indian engineers is in 20s and that of managers is late 20s to early 30s. Younger professionals
are more receptive to change, as they have not invested in traditions and indeed want changes.
Indian culture is more family-oriented rather than individualistic. This prompts people to
conform to established frameworks and systems. Professionals do not mind being measured.
There are fewer privacy concerns and in-house surveys have indicated that most engineers are
more concerned about the nature of work and the overall work environment, and not so much
about being measured. The software background of top managers helps to secure backing from
senior management for SPI initiatives.
Most of the facilitating factors are based in more general and societal context. Such factors are
hard to emulate once the context changes. Government had little role to play in this movement.
India does not have centers along the lines of the U.S. or European Software Engineering
Institutes. The Ministry of Information Technology in India did bring in the world‘s best
Software Testing and Assessment of Software Maturity through licensing arrangements with
Software Engineering Institute at Carnegie Mellon University. Under this agreement, the Indian
Standardization, Testing, and Quality Certification (STQC)
31
32. External Analysis:
Fig 4.2 Current Position of IT/ITES in India
Segments of the Indian IT sector:
IT Services: It is of the market size of USD 46.0 billion during FY2011. Over 73 percent of
the revenue comes from the export market. Banking, Finance, services and insurance has
been the major sector in this segment
Business Process Outsourcing (BPO): It is of the market size of USD 17.3 billion during
the FY 2011. US accounts for over 60 percent of the export market. Around 81 percent of
the revenue comes from the export market.
Engineering design and product development: It is of the market size of USD 12.9 billion
during the FY 2011. Over 70 per cent of the revenue in the segment comes from exports.
Hardware: Market size of USD 11.8 billion during the FY 2011. Over 80 per cent of the
revenue in the segment comes from domestic market. Domestic market is seeing good
growth as penetration of personal computers is rising in India.
32
33. Trends of the market:
Indian IT-BPO Industry
FY2012 is a landmark year – while the Indian IT-BPO industry weathered uncertainties in the
global business environment, this is also the year when the industry is set to reach a significant
milestone – aggregate revenue for FY2012 is expected to cross USD 100 billion, exports at USD
69 billion. Aggregate IT software and services revenue (excluding hardware) is estimated at
USD 88 billion
Fig 4.3 IT-BPO revenues
Within the global sourcing industry, India was able to increase its market share from 51 per
cent in 2009, to 58 per cent in 2011, highlighting India‘s continued competitiveness and the
effectiveness of India-based providers delivering transformational benefits.
Software and services revenues (excluding Hardware), comprising nearly 87 per cent of the
total industry revenues, expected to post USD 87.6 billion in FY2012; estimated growth of
about 14.9 per cent over FY2011
Within Software and services exports, IT services accounts for 58 per cent, BPO is nearly 23
per cent and ER&D and Software Products account for 19 per cent
The industry continues to be a net employment generator - expected to add 230,000 jobs in
FY2012, thus providing direct employment to about 2.8 million, and indirectly employing
8.9 million people.
While the global macroeconomic scenario remained uncertain, the industry exhibited
resilience and adaptability in continually reinventing itself to retain its appeal to clients.
33
34. Embracing emerging technologies, increased customer-centricity, deepening focus on new
markets, adopting new business models are some successful growth strategies followed by
the industry.
Domestic IT-BPO
Domestic IT-BPO revenue (excluding hardware) is expected to grow at almost 17 per cent to
reach Rs 918 billion in FY2012. Strong economic growth, rapid advancement in technology
infrastructure, increasingly competitive Indian organizations, enhanced focus by the government
and emergence of business models that help provide IT to new customer segments are key
drivers for increased technology adoption in India
Fig 4.4 Trends of Total Indian Domestic Market
Domestic customer base comprising the government, large, micro, small & medium enterprises
and household consumers, represent unique set of requirements
Direct employment within the domestic IT-BPO sector is expected to grow by 7 per cent over
FY2011 to cross 600,000 employees with the industry creating immense job opportunities in Tier
II and Tier III cities
IT Services
Over the years, Indian IT service offerings have evolved from application development and
maintenance, to emerge as full service players providing testing services, infrastructure services,
34
35. consulting and system integration. The coming of a new decade heralds a strategic shift for IT
services organizations, from a ‗one factory, one customer‘ model to a ‗one factory, all
customers‘ model. Central to this strategy is the growing customer acceptance of Cloud-based
solutions which offer best in class services at reduced capital expenditure levels.
IT services exports is the fastest growing segment, growing by 19 per cent in FY2012, to account
for exports of USD 40 billion.
Fig 4.5 Indian IT Service Exports
Considerable traction in traditional segments – custom application development, application
management, IS outsourcing and software testing. Increased acceptance from mature segments
such as BFSI, US, and large corporations, and emerging segments such as retail, healthcare,
utilities, SMBs, Asia Pacific . Emerging technologies – cloud computing, mobility, social media
and big data/analytics unleashing new opportunities for the industry
IT services is the fastest growing segment in the Indian domestic market, growing by 18 per cent
to reach Rs 589 billion, driven by increasing focus by service providers
BPO
In the last few years, the BPO segment has been focusing on re-engineering itself in order to
deliver transformational impact to customers. A ‗Verticalised‘ approach has been a key
marketing strategy – developing in-depth capabilities across the entire value chain in specific
verticals. BPO firms are also increasing their onshore and near shore footprint to enable
35
36. customer entry into local markets; firms have also been actively implementing non-linear growth
initiatives that ensure higher realizations for service providers, while controlling costs,
facilitating faster time-to-market and improving satisfaction at the clients‘ end.
BPO exports expected to reach USD 16 billion in FY2012, growing by over 12 per cent over
FY2011.
Fig 4.6 Indian BPO Exports and Employment
Engineering & R&D Services (ER&D)
The engineering design and products development segments generated export revenues of USD
10 billion in FY2012; growing by about 14 per cent, driven by increasing use of electronics, fuel
efficiency norms, convergence of local markets, and localized products. The Indian IT-BPO
industry has invested significantly to strengthen their customer outreach and build engineering
capacity and capability not only across new and existing verticals but also across the full
spectrum of product development value chain.
36
37. Fig 4.7: Engineering & R&D Services(ER&D)
SME firms in ER&D ingraining the ‗innovation mindset‘; exploring growth opportunities by
addressing whitespaces across various verticals
Software Products
The past few years have witnessed a noticeable shift in the Indian software product business
ecosystem which has helped create an enabling environment for the growth of Indian software
products. These include acceleration in software product business activity in India;
improvements in the talent and support ecosystem, innovations in software product technology,
delivery/business models, and changes in the Indian economy that are helping catalyze the
development of the domestic market for software products. Increased adoption of IT by
enterprises, especially among SMBs, and home-users is driving growth in this segment.
Increasing IT adoption in India has also helped in creating a sizeable product business market
opportunity locally.
37
38. Fig 4.8: Indian Software Product Exports
Software product exports to reach USD 1.5 billion, y-o-y growth of 13 per cent, driven by
mobility and cloud applications, SMBs
Domestic software products segment is set to grow to Rs. 180 billion in FY2012, a growth
of ~13 per cent over FY2011 driven by the need to replace legacy systems, technology
advancements around cloud, mobility, etc
Offshore Software Product Development (OSPD)
India‘s Outsourced Software Product Development (OSPD) exports market crossed the billion
dollar mark in FY2011. Despite its small base, the OSPD market has consistently experienced
double-digit growth rates over the last five years.
Fig 4.9: Indian OSPD Exports
In FY2012, OSPD market is expected to grow faster than industry average at 17 per cent to
cross USD 1.2 billion in exports
Demand drivers : The rapid proliferation of cloud, mobile and social media technologies,
strategic importance of mining customer data for differentiating market insights and the
urgent need to focus on core business markets to tackle ever increasing competition
Global In-House Centers
Global In-House centers (GIC) have played a key role in the IT-BPO sectors phenomenal growth
story, establishing ‗proof of concept‘ and branding India as a global sourcing destination. The
38
39. segment, miniscule till 2003, has witnessed tremendous development in the last 7 year‘s –
growing at a CAGR of 22 per cent, employing close to 4 lakh people and contributing to 1 per
cent of India GDP. Their impact on India extends beyond revenues and employment- playing a
leading role in developing an R&D and product culture, spearheading initiatives to develop
affordable products for emerging markets and creating entrepreneurship opportunities.
Fig 4.10:Captive Revenue across categories
There are over 750 IT-BPO MNCs captive centres in India in FY2010, 28 per cent of them
with multiple locations and employ almost 4 lakh people.
GIC contribute to 22 per cent of IT-BPO export revenues and 21 per cent of employees
The industry has significantly grown over the last 5 years and currently has representation
from most of the verticals like Aerospace & Defence, Automotive, BFSI, Bio-Technology,
Chemicals, Computer Hardware, Education, Electronic/Electrical Equipment, Energy,
Healthcare, Industrial, Semiconductors, Software/Internet, and Telecommunications, etc.
North America and Europe happen to be the largest investors in the captive space; together
they contribute to more than 90 per cent of the captives in India
Future Outlook
Despite 2011 ending in a difficult economic environment, some geographic regions and services
are expected to circumvent the situation in 2012. Global GDP, after growing by 2.7 per cent in
2011, is expected to grow 2.5 per cent in 2012, with developing economies growing thrice as
fast as the developed economies. Better economic conditions in the second half of the year
signifying return of consumer confidence and renewal of business growth, is expected to drive
IT spending going forward.
39
40. Fig 4.11: Indian IT-BPO Revenues
Global technology related spend expected to grow by 5 per cent in 2012
Global sourcing to continue growth trend as organizations aim to cut costs, access local
market and innovation and sourcing requirements
Indian IT-BPO services exports expected to grow by 11-14 per cent while domestic services
to grow by 13-16 per cent (in Rs terms)
India accounts for less than 5 per cent of global technology spending – tremendous untapped
potential for growth of Indian IT-BPO sector, in both core as well as emerging opportunities
To achieve this growth, the sector has to continue to re-invent itself – through new business
models, global delivery, partnerships and transformative focus
Prevailing global megatrends presents new opportunities and risks for the industry, which
will shape the technology industry landscape
IT-BPO sector will need to build on its strengths and address challenges around competition,
talent, security and business environment
In the future, the industry to drive transformation, innovation and inclusivity in business and
India
Impact on India's Growth:
IT-BPO sector has become one of the most significant growth catalysts for the Indian economy.
In addition to fuelling India‘s economy, this industry is also positively influencing the lives of its
people through an active direct and indirect contribution to the various socio-economic
parameters such as employment, standard of living and diversity among others. The industry has
played a significant role in transforming India‘s image from a slow moving bureaucratic
40
41. economy to a land of innovative entrepreneurs and a global player in providing world class
technology solutions and business services. The industry has helped India transform from a rural
and agriculture-based economy to a knowledge based economy.
Influence of the factors on the industry over 3 years
With the market size of USD 76billion in the year 2011, a number of factors show that India has
an advantage over other countries in the field of IT.
Some of them are:
1. Growing demand: Strong growth in export demand from different verticals like Banking,
Finance services, Insurance etc. Growing economy of India drives the rise in local demand.
2. Competitive position: India has 60-70 percent cost saving over source countries like US,
UK etc. India is already the leading destination for IT&ITeS, and the market share is still
rising. Presence of a huge talent pool of engineers and other graduates gives it a competitive
position.
3. Global Footprint: Indian IT firms has delivery centers across the world. The number of
global delivery centres of Indian IT firms has crossed 250 centres in over 60 countries as of
2009.Industry is well diversified across verticals like Banking, Finance services, Insurance,
telecom, retail.
4. Policy support: Tax holidays extended to IT sector saves a lot of cost to the IT firms
increasing their revenues. SEZ scheme since 2005 has benefited the IT companies with single
window approval mechanism, tax benefits etc.
Key Success factors:
IT sector to be driven by strong demand and Indian expertise.
Talent Pool: Availability of skilled talent has been a major reason behind India‘s emergence
as global outsourcing hub. Every year nearly 3.7 million additions to talent pool from across
the country. There is strong mix of young and experienced professionals in India. Growing
talent pool of India has the ability to drive the R&D and innovation business in the IT-BPO
space
Domestic growth: Computer penetration is expected to increase inside the country.
Increasing affluence of domestic consumers, globalization of key segments expected to
41
42. enhance the domestic spend on IT services. Number of sectors in India are expected to
outsource higher percentage of their non core work giving boost to IT-BPO sector.
Government is expected to become a major contributor to domestic demand by 2013-14.
Infrastructure: Robust IT infrastructure across various Indian cities such as Bangalore,
Chennai, Pune has Delivery centers spread across various countries.
Policy support: Tax holidays for STPI and SEZs Procedural ease and single window
clearance for setting up facilities. SEZs to drive Indian IT sector; Tier II cities are emerging
as new centers. IT-SEZs have been initiated with a view to creating zones that lead to
infrastructural development, exports and employment. During FY10, 94 per cent of total IT
exports were accounted for by STPI units. 43 new tier II/III cities are emerging as IT delivery
location. This could reduce pressure on leading locations The cost in newer cities is expected
to be lower by up to 28 per cent than the leading cities. Over 50 cities already have basic
infrastructure and human resource to support the global sourcing and business services
industry. Some cities are expected to emerge as regional hubs supporting domestic
companies.
Global demand: Global IT offshore spending expected to grow at CAGR of 6.2 per cent
during FY08-13.Global BPO spending expected to grow at a CAGR of 9.1 per cent during
FY08-13. Strong demand is expected from emerging countries which currently account for
only 20 per cent of global IT spending.
42
43. Market share of the industry:
Indian IT market is dominated by a few companies with the presence of large small and medium
companies.
Fig 4.12 Market Share of Indian IT Industry
Market share
TCS
8.5%
Wipro
7.9%
Infosys
6.9%
Cognizant
5.2%
HCL Tech
65.1% 4%
Tech mahindra
1.2%
Mahindra Satyam
1.2%
Others
43
44. Porters 5 force model for IT industry
Fig 4.13: Porter Framework for IT Industry
44
45. Market leader analysis: Tata Consultancy Services
Rapid globalization, diversification, and intense competition have resulted in a more
dynamic and complex world. Corporations have to increase agility in a way in which their
business units across geographies operate and collaborate seamlessly across people,
processes and technology
Tata Consultancy Services (TCS) is an information technology consulting, solutions and
services Organisation.The Company is a part of one of India‘s most respected business
conglomerates the Tata Group.TCS started its operations in 1968, and pioneered the IT
services industry out of India. It has been the largest Indian IT services company ever since
its inception. The company offers business process outsourcing (BPO), enterprise systems
installation, offshore software development and systems integration services.TCS also
provides product and industrial process engineering services as well as strategic consulting
and project management services. These services are provided to a spectrum of industries
such as banking, financial services, insurance, telecom, manufacturing, media and
entertainment, retail and consumer goods, transportation, health care and life sciences,
energy and utilities.
Tata Consultancy Services Limited (TCS) is a leading and India‘s largest provider of IT
Services, Business Solutions and Outsourcing with revenues of USD 6B during FY08-09.
TCS envisioned and pioneered the adoption of the flexible global business practices that
today enable companies to operate more efficiently and produce more value. More than 95
percent of TCS customers reward the company‘s reliability, passion, creativity, and unique
ability to handle the broadest range of their IT needs. TCS has 143,000+ world‘s best trained
IT consultants located in 50 countries. TCS achieved this by creating and perfecting a unique
method of global deployment and delivery of high quality, high value services known as
Global Network Delivery Model (GNDM™), the strategic services delivery concept that has
reshaped the IT services industry. GNDM™ is a unique network of 79 Delivery Centers in
16 countries. These delivery centers operate at the same quality (TCS is the only company in
the world to be assessed at CMMi Level 5 through a single assessment across all its delivery
centers), security and skill levels, giving customers the same experience of certainty across
the organization globally.
45
46. GNDM provides the fastest turnaround time from concept to service delivery, with certainty
of cost, quality and schedule, tailored for its customers based on the type of work, risk
mitigation needs, business knowledge requirements, geographic spread, scale of delivery etc.
Being a pioneer in the IT industry, TCS have a good appreciation of trends and challenges
faced by industries TCS choose to focus. The solutions TCS build are powered by domain
expertise, enterprise solutions and infrastructure services, turning the challenges of
globalization into a competitive edge for clients.
TCS helps some of the world‘s largest companies adopt the right technology-enabled
solution that helps them:
Optimize business performance
Facilitate alignment of business with technology
Connect their extended supply chains
Reduce product development time
Improve product differentiation
Provide real-time business insight
Lower operational costs
Profile
Mission reflects the Tata Group's longstanding commitment to providing excellence:
To help customers achieve their business objectives by providing innovative, best-in-
class consulting, IT solutions and services.
To make it a joy for all stakeholders to work with us.
Values: Leading change, Integrity, Respect for the individual, Excellence, Learning and sharing.
Leadership in IT Outsourcing: TCS is the largest IT consulting company in Asia with 143,000
of the world's best trained IT consultants and an acknowledged pioneer, innovator and thought
leader in the IT space, having literally coined the term ―Offshore Development‖. It is also a
global consulting, IT services and systems integrator with a 40-year track record and world class
processes and methodologies. TCS has won many accolades for its significant contribution to the
maturity and visibility of the Indian IT services worldwide
46
47. Trusted Partner: TCS is part of one of Asia's largest conglomerates - the TATA Group. The
group, with annual revenue of more than USD 72.5 billion+ (Feb, 2009), spans across diversified
industry segments such as consumer package goods (CPG), energy, telecommunications,
financial services, chemicals, engineering & materials. The TATA Group, a symbol of trust in
India, is known for its pioneering spirit and the brand stands for business excellence and
integrity.
Headquarters
TCS is headquartered out of Mumbai, India.
Location
TCS is operating in 47. TCS has 50+ delivery centers in India across 15 cities; 15+ development
centers outside India. TCS‘ employees are spread across countries. Thus, Global presence helps
in country availability of competencies for any technical assistance mission or application
project. Also, TCS deputes the associates on long term and short term basis to the local countries
for specific engagements.
Turnover
Tata Consultancy Services Limited (TCS) is a leading and India‘s largest provider of IT
Services, Business Solutions and Outsourcing with revenues of USD 6 Billion during FY08-09.
Number of customers
Over 985 active clients; 6 out of Top 10 US Fortune companies are TCS clients.
47
48. Fig 4.1: Organization Structure Of TCS
Fig 4.2: TCS By numbers
Source: TCS Corporate Sustainability report 2010-11
48
49. Key Differentiators of TCS
Pioneer in the industry & Brand
Having started in 1968, TCS has established himself as the industry leader. Being part of the
trusted Tata group is also a big differentiator for TCS giving it a strong brand strength.
Integrated full-services player
Portfolio of offerings extends from consulting to implementation, testing and support; from
engineering services to BPO; from products to end-to-end solutions.
Collaboration with multiple stakeholders
Having worked on large global scale enterprise projects, TCS appreciates the need for
flexibility to work with multiple stakeholders from customers, partners, and other service
providers. TCS have developed innovative engagement models that have proven TCS‘ ability
to deliver significant value to its customers in managing their projects as the sole solution
provider, or prime/lead partner, or supporting partner.
Global Network Delivery Model
Unique network of 79 Delivery Centers in Brazil, Uruguay, Chile, China, Hungary, UK, Japan,
Australia, Singapore and India that operate at the same quality, security and skill levels, giving
customers the same experience of certainty across the organization globally with a lower total
cost of ownership.
High Quality and Maximum security
In 2005, TCS was awarded enterprise-wide triple certification for:
Quality (ISO 9001:2000), Security (BS 7799-2:2002) & Services (BS 15000-1:2002)
Innovation Network
TCS has established 19 labs with strong links to start-ups, academia and alliance partners to
continuously develop innovative solutions for their customers.
TCS Technology Partnerships and Relationships
Tata Consultancy Services combines its system integration expertise, flexible global delivery
model and deep industry insights with the technological expertise and capabilities of its
renowned alliance partners to offer competitive advantage to its customers. The alliances
enable TCS to deliver cutting edge technological solutions and enhanced services to help
customers integrate their business applications effectively while improving the operational
49
50. efficiencies and ROI. Strategic partner relationships of TCS include leading industry players
like SAP, Oracle, IBM, and Microsoft among others.
Strategic Partners
IBM - Global System Integrator Partner
Oracle - Global System Integrator and Global Certified Advantage Partner
Microsoft - Global System Integrator Partner
SAP - Global Consulting Partner
Growth Engine Partners
Siebel - Consulting Partner
Web Methods - Global System Integrator, Preferred Offshore Partner
BEA- TCS is BEA‘ Strategic Partner
SUN- System Integrator Partner, GSS Partner
Business Continuity
TCS follows a well defined and mutually agreed (with customer) business continuity and disaster
recovery plan. The BCP is tested on a pre determined frequency. This was recently invoked
during the under-sea cable fault leading to disruptions in the voice/internet connectivity. The
traffic was diverted through alternate routes as per the plan.
Fig 4.3: Operating Structure of TCS
50
51. TCS‘ organization restructuring in April 2008 was one of the major moves in last decade to adapt to
external environments. Having an organization structure that would respond to customer demands is
most efficient way to lay down your business strategies. TCS did it little late but just in time.
Strategy for long-term growth
TCS‘ revenue growth comes from following a multi-pronged strategy built around
(I) expanding our addressable market by geography, by industry and by service-line and
(ii) Deepening our client relationships.
Fig 4.4: Five point Strategy for long term growth
Customer
Centricity
Non-Linear
Full Services
Business
Strategy for Capability
Models
Long-term
Sustainable
Growth
Strategic
GNDM
Acquisitions
Source: TCS Corporate Sustainability report 2010-11
1. Customer-centricity
The Company‘s strategy is to be a trusted business partner to large global corporations. TCS has
built a customer-centric organization structure which puts customers at the center of its operating
units and teams. The Company‘s promise of certainty resonates with customers as it offers them
real business results through optimal IT design and deployment. TCS‘ ability to solve the
customer‘s most challenging business problems is the core business need around which our
offerings and services evolve.
51
52. 2. Global Network Delivery Model TM
TCS has established a unique Global Network Delivery ModelTM (GNDMTM) that allows the
Company to deliver services to customers from multiple global locations in India, China, Europe,
North America and Latin America. The GNDM™ enables the Company‘s delivery centers to
collaborate on projects and leverage all its assets in order to ensure ‗One Global Service
Standard‘.
3. Integrated Full Services Offerings
TCS continues to build on its ‗Full Services Play‘ that offers its global customers an integrated
portfolio of services. This includes a comprehensive range of (1) IT services capabilities in the
areas of Application Development, Application Management and Enterprise Solutions (2)
Business Process Outsourcing services (3) Infrastructure management services with a strong
focus on ‗Remote Infrastructure Management‘ and transformation (4) Engineering services with
a focus on Enterprise Asset Management, Industrial Embedded Systems, Plant Automation
Services and Product Engineering (5) Assurance and Validation services (6) TCS‘ own product
based solutions, primarily in financial services area with its TCS B_NCS suite of offerings and
(7) Global Consulting capability that brings strong skills in program management, change
management, process management and architecture. This suite of integrated full services
portfolio presents a compelling value proposition for global corporations and continues to
increase traction in the market place, as customers look for opportunities and partners who can
bring transformation solutions which include innovation, optimization and time to market
competitive advantage for their businesses. This integrated full services offering strategy
captures the entire value chain of IT - from consulting and design to products and solutions and
from implementation to support.
4. Strategic Acquisitions
In addition to sustaining strong organic growth, the Company continues to closely look at
acquisitions that are strategic in nature. Through inorganic means the Company may look to
strengthen gaps in its services portfolio, enter new geographies or market segments as well as in-
source domain and technology expertise. The strategic acquisitions done over the years have
created new capabilities within the Company and these acquisitions continue to yield synergistic
growth.
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