The document outlines a contingency strategy for Videocon Industries, detailing the company's decline due to reckless diversification, high debt, and competition. As the newly appointed CEO, Anindya Singh presents a turnaround plan focusing on divesting non-core businesses, digital transformation, and workforce optimization to boost profitability within a year. The financial plan estimates the transformation will require approximately INR 11 crore and emphasizes the importance of avoiding further debt while enhancing customer engagement and operational efficiency.

1. Videocon
Case
May 2023
Contingency Strategy
Prepared By: Anindya Singh
MU | Executive Programme

2. I. Introduction 3
II. Problem Diagnosis 4
III. Strategy 6
IV. Execution 7
V. Financial Plan 9
VI. Assumptions &
Conclusion
10
Table
of Contents

3. Introduction
About the Company | My Role
About the Company
Videocon Industries Limited
was a large Indian multinational
conglomerate that operated in a
variety of industries including
consumer electronics, home
appliances, and oil and gas.
The company was founded in
1985 by Venugopal Dhoot, and
at its peak, it had revenues of
over $6 billion and employed
more than 20,000 people.
PAGE 3
My Role
In recent years, Videocon has faced financial
difficulties and I've been appointed as a CEO
to save the organisation.
As the CEO of Videocon in 2010, my primary
goal would be to turn around the fortunes of
the conglomerate and steer the company
towards profitability.
To achieve this goal, I have formulated
business strategies which I'll discuss on the
Strategy Page.

4. Past > Future
Videocon's collapse stemmed from
multiple causes, such as its recklessly
rapid diversification into fresh
territories, mismanagement, and
excessively elevated indebtedness.
Even though the firm had put substantial
capital into exploring oil and gas reserves,
these initiatives failed to yield profits,
which in turn accumulated the company's
debt obligations.
As for the company's consumer
electronics and home appliance
operations, they too were experiencing
difficulty due to strong competitors like
Samsung and LG. In addition, the
management was receiving negative
feedback regarding its transparency and
corporate governance methods.
The decline of Videocon was a result of a
mix of elements from within and outside
the company. Rapid expansion without a
plan doomed the organisation.
PAGE 4
Problem
Diagnosis

5. PAGE 5
Problem
Diagnosis
Diversification into Non-Core
Businesses
Heavily Diversified - with operations
spanning a wide range of sectors
including consumer electronics, home
appliances, oil and gas, and
telecommunications.
Low Profitability
A significant amount of debt for
diversification, in addition to service due
to a downturn in the economy(2008
financial crisis) and increased
competition in its core businesses.
High Level of Debt
The company's debt burden is becoming
unsustainable, and it struggling to make
interest payments and loan repayments.
Other Factors:
Increasing competition - International
players like Samsung and LG in the
consumer electronics and home
appliance businesses.
Cost optimisation - Manufacturing
practices, inefficient logistics and
transportation, and terms with suppliers
and vendors.

6. Divesting
Restructuring
Digital
Transformation
Divesting and shutting down
non-core businesses and
focusing just on consumer
electronics segment
Restructuring and Removing
non relevant manpower
Digital Transformation:
(DAMS Strategy)
This will enable us to allocate resources and investments more
efficiently.
As of 2010 since more than 80% of our revenue is coming from
the consumer electronics business by solely focusing on it we
can increase our market share in this segment and build a
stronger brand image.
The stronghold of our Consumer-Electronic supply chain and our
Distributor Network can lead to increased revenue and
profitability for the company. This will also create a barrier for
the competitors.
Aligning the current workforce with strategic objectives,
enabling us to focus on our core competencies and areas of
expertise.
Removing non-relevant manpower, optimizing the current
workforce and reducing labour costs.
Digitalization solutions:
Listing on existing marketplaces and e-commerce website
development that allows customers to access and purchase
Videocon products online.
Implementing ERP & CRM systems for efficient and
transparent handling of the organisation and tracking
customer interactions and improving customer service.
Automation:
Investment in automated assembly lines to increase
production efficiency and reduce labour costs. (In Phases)
Implement automated quality control systems to improve the
quality and consistency of Videocon products.
Marketing initiatives:
Leveraging new social media platforms like Facebook to
reach a wider audience and build brand awareness.
Leverage Google Ads and display advertising to target
specific customer segments.
Supply chain optimization:
Leverage ERP system for demand planning to improve
forecasting accuracy and reduce inventory levels.
Leverage ERP system to optimize shipping routes and reduce
transportation costs.
Strategy
DRD + DAMS Digital Strategy
PAGE 6

7. CEO
Existing Business
Transformation Project
Operations HODs
ERP PM
Finance HODs
Website PM
Consumer Electronics
Execution
Leadership
PAGE 7
Social Media & Brand
Communication PM
Supply Chain PM
Manufacturing PM

8. Execution
Implementation Plan
PAGE 8
MAR APR MAY JUN JUL AUG SEP OCT NOV DEC JAN FEB
DIGITALISATION
DIGITAL
TEAM 2
E-COMMERCE DEVELOPMENT
AUTOMATION
MANUFACTURING
TEAM 1
ASSEMBLY LINE
MANUFACTURING
TEAM 2
QUALITY
MARKETING
MARKETING
TEAM 1
MARKETING
TEAM 2
MARKETING
TEAM 3
SUPPLY
CHAIN
SC
TEAM 1
DEMAND PLANNING
SC
TEAM 2
SHIPPING &
DISTRIBUTOR NETWORK
DATA GATHERING
GOOGLE ADS
SOCIAL MEDIA
FESTIVE COMMUNICATION
TRAINING
ANCHOR
COMMUNICATION
DIGITAL
TEAM 1 RESEARCH ERP/CRM SYSTEM INTEGRATION & TRAINING
ANALYSIS
ANALYSIS PROCURING CONFIGURING
INSTALLING
TRAINING
ANALYSIS PROCURING CONFIGURING
INSTALLING
INTEGRATION TO THE ERP SYSTEM ANALYTICS
DATA GATHERING
ANALYSIS INTEGRATION TO THE ERP SYSTEM ANALYTICS
Transformation Project Plan of 1 Year
4 Verticals with Sub-Teams
2011

9. Capital Requirements
Human
Resource
Team Size
Average Package (in Lakhs per
Annum)
Total Cost (in Lakhs Per
Annum
ERP 10 15 150
Website 7 20 140
Social Media 3 10 30
Manufacturing 10 15 150
Supply Chain 5 15 75
Grand Total 545
Financial
Plan
PAGE 9
Expense Revenue Profit
2007 2008 2009
10,000
7,500
5,000
2,500
0
Last year's (2009) Profit = 578.35 Cr
Vendors & Misc Description Total Cost (in Lakhs)
ERP Open Source ERP System Integration 25
Website
In-House Development (Hosting and Domain external
partner)
5
Social Media In-House Team (Online Advert Spend phase wise) 50
Manufacturing New Equipment 500
Supply Chain Analytical Tools 15
Grand Total 595
Assumed Capital Requirement for
Transformation = 11.40 Cr
IN CRORES (INR)

10. Appointment Appointment in Jan 2010
Knowledge Transfer sessions and Know-how of the organisation
achieved in 2 months
Human Resource &
Company Revenue
Team restructuring and new hirings completed by Feb 2010
Pay packages best in the industry based on 2010 data
As per the data, 80% of the revenue comes from the consumer
electronic vertical, considering that phase-wise shutdown of
different verticals will be done (Excluding Compressors & Semi-
Conductor Verticals)
Cost of services ERP System, Web development, etc. - Based on personal
experience and on the higher side of quotes.
References https://www.videoconindustriesltd.com/
https://www.moneycontrol.com/financials/videoconindustries/balanc
e-sheetVI/VLF
Assumptions
Assumptions &
Conclusion
PAGE 10
Developing digital platforms that encourage customer engagement, as well as adopting
automation practices to improve production efficiency and cut labour costs.
Streamlining operations by restructuring and reducing irrelevant staff will make Videocon a
sleeker and more effective organization.
Avoid taking on more loans as the company is already in a significant amount of debt, and taking
on additional debt could further strain its financial resources and ability to invest in growth
initiatives.
Videocon's smooth makeover can be accomplished in just one year, with an expense of approx INR 11
crore. By getting rid of non-core affairs, reorganizing its workforce, and executing digital solutions
based on 2010 technologies, as well as promotions, automation, and efficiency in the supply chain,
Videocon can efficiently streamline its operations, optimize its workforce, and enhance engagement
with its customers.
Videocon can achieve its transformation goals while staying on budget and within the allotted time
frame by identifying the most crucial areas with the greatest potential impact.
The immediate focus should be on
Conclusion

11. anindya.singh@outlook.com | +91 980-770-7073 | linkedin.com/in/anindyasingh/
THANK YOU