Global markets are changing – is India following suit?!

IIPM, ADMISSIONS FOR NEW DELHI & GURGAON BRANCHES

The market for textile products is witnessing significant changes. Competition from Asian suppliers has been increasing even in Western markets, whereas participants in their Regional Trade Agreements are losing ground. Domestic production in North America & Western Europe has been declining consistently during the last few years and their textile industries are projected to shrink mostly into high tech segments in the coming years. In India, the industry has experienced an impressive growth in terms of installed capacities. Exports have also recorded significant growth after abolition of bilateral quotas. However, certain developments during the last few months such as the rupee appreciation and increase in interest rates seem to have dampened the enthusiasm that this industry has witnessed during last few years.

The current retail boom is bringing large distribution networks to the domestic market, necessitating production facilities that can meet their demand for volumes. We are the second fastest growing economy in the world, with the second largest population. The problems being faced by this industry in the international markets could also turn out to be an opportunity for strengthening supplies to the domestic market. After all, competitive exports can come only from an efficient industry. Given the poor R&D activities and traditional ways of carrying out business that most segments of our industry are accustomed to, our response to the current changes in market trends has not been adequate. Adding value to commodity type products, scaling up production facilities in order to reduce cost & branding to climb up the value chain are major areas that need attention.

We have made sufficient progress on the raw materials front. Productivity of cotton has gone up from about 300 kg per hectare a few years back to over 500 kg per hectare and cotton production has reached an all time high record of 280 lakh bales this year. In garments and home textiles, organised production has been picking up, though not fast enough. In the case of fabrics, however, we have not been able to keep pace with the changes in demand trends. Organised weaving does not have a share of even 5% in our fabric production. The processing segment has been seeing some increase in investments. But again, a major portion of our fabrics continue to get processed in the hand processing segment. With increasing pressure on prices, cost reduction assumes extra importance. Scaling up production facilities is the key for optimising cost through effective utilization of modern technology. The Scheme for Integrated Textile Parks and TUFS are positive policy inputs from the government for making this feasible. Power at affordable prices as well as acceptable quality and workable labour laws are the important inputs still lacking.

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Source : IIPM Editorial, 2007

An IIPM and Professor Arindam Chaudhuri (Renowned Management Guru and Economist) Initiative

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IIPM Gurgaon Industry Visit

One may learn how to manage the work force or regulate the cash flows or control logistics, just by pouring over piles of notes handed over by lecturers in the most plush class-room settings. But this learning would miss the real zing, if one is not exposed to the original environment. This is why the institute organizes regular industry visits, whereby the students get to be in the middle of an actual production centre to witness how the 5 Ms (Manpower, Machinery, Material, Measurement & Method) are actually utilized. Visits to industries have always been an exciting & learning experience for IIPM students.

IIPM Gurgaon students have visited in various industry like Mother Dairy - Delhi, HERO HONDA - Gurgaon plant, Maruti Suzuki India Limited - Udyog Vihar Plant, Parle Biscuits Pvt. Ltd - Neemrana Plant etc.

IIPM Gurgaon Guest Lecture

Learning is a continuous process of interaction. Every time one interacts with someone new, there is something new that the individual gets to learn from every such interaction. This is what the Guest Lecture program at IIPM aims to achieve, whereby, the institute presents locally and internationally prominent speakers from a diverse field covering general management, advertising, journalism, social science, etc. They are invited to share their work and ideas with the student community, thus providing insights into contemporary professional practices. Their practical instances give our students an insight into the changing corporate world and means to adapt to these changes.

IIPM students attended the following guest lectures by eminent guest speakers from the corporate India.

Topic: "Monetary Policy"
Speaker: Dr. Leena Kaushal (Senior Manager, Helix Financials, India)
Total Students: 45

Topic: Guerrilla Marketing
Speaker: Dr. Girish Kathuria

Topic: Practices for Corporate Excellence
Speaker: Mr. Hari Nair
Vice President (Head - Corporate Human Resources), Sona Koya Steerings

Topic: “Importance of Soft Skills in Professional Life”
Speaker: Mr. Ashok Malhotra (CEO, Spark Leadership Incorporated)
Total Students: 35

Topic: “Innovation- a strategy for gaining competitive advantage”
Speaker: Mr. Tushar Makkar
Total Students: 29

Topic: “Management Preach and Practice”
Speaker: Mr. Vijay Jolly (Sitting MLA, Saket)
Total Students: 35

Topic: “Is Real Estate Really Real?”
Speaker: Mr. Ajay Mathur (VP, Clarion Group)
Total Students: 35
Sent at 22:37 on Friday

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Chris Zook, Partner Bain & Company

Companies that face turmoil must leverage on their inherent strengths

Peter Parker, alias Spider-Man, was about 15 years old when he first appeared in the 1962 comic book Amazing Fantasy No. 15.

That would make the besieged photographer from the Daily Bugle close to 60 years old this spring, when he exploded on movie screens around the world with the release of “Spider-Man 3.” Perhaps even more marvelous is how the geriatric Parker also rescued Marvel Entertainment, the firm that created him. Not so long ago, Marvel’s financial fate hung by a thread. Spider-Man’s box-office might shows that superheroes are not the only ones with hidden powers. Businesses have them, too, in the form of underutilized or underappreciated assets – assets that can reinvigorate their core.

One way to understand Spider-Man’s rebirth is through what’s called the focus expand- redefine cycle, which nearly every large enterprise is moving through at an accelerating rate these days. In the “focus” phase, companies concentrate on building their core business to its full potential. They grow their markets, cut costs, improve operations and develop innovations in core products. In the “expand” phase, they take advantage of these capabilities and market positions to move into adjacent markets. Inevitably, though, many companies have to experience dwindling growth and profitability.

Perhaps the market has reached saturation or the available pool of profits has shifted. Or perhaps new competitors with lower cost structures or innovative products have appeared. This is the time to “redefine” the core. With the average lifespan of companies dropping from 14 years a decade ago to now just over 10 years, and with a dramatic decrease in the useful life of a company’s strategy, more companies will find themselves in that fateful third phase. The issue for executives looking to redefine their businesses is which new course to take.

Some will stubbornly defend the status quo. Others will try big mergers or leap into a hot new market. But a number of companies have found an alternative that entails less risk. They uncover and deploy hidden assets that have been overlooked, undervalued or underutilized. Companies that manage to do this can reinvent their core. Marvel used this approach to successfully fight its way back from its 1996 bankruptcy. The struggling publisher’s vast assemblage of 5,000 comic-book characters was in a kind of hibernation. But director Isaac Perlmutter, now CEO and vice chairman of the board, understood the power of nostalgia, and the old characters began to be revived and reborn on the screen. The first was Spider- Man in 2002.

Thanks to films featuring the well loved web-slinger – as well as others starring Marvel marquee names such as Wolverine, Daredevil and the Hulk – by 2005, revenues from movie licenses and merchandise accounted for more than half its $390.5 million in revenues and much of its $103 million in profits. In fact, most hidden assets tend to fall into three categories: undervalued business platforms, untapped customer insights and underexploited capabilities. All, it turns out, can provide a new core for a company. Spider-Man, and his stable of super colleagues, represents a classic case of an undervalued business platform.

On the other hand, De Beers, the legendary South African diamond distributor, redefined its core by mining consumer and customer relationships. Back in the late ‘90s, the famous firm was sitting atop a $5 billion stockpile of rough diamonds, yet its profits were sinking. De Beer’s looked hard at its business, and found it had deeper relationships with consumers than it realised, and more knowledge about those consumers that it could put to work. Liquidating 80% of its inventory, the firm created a new business model, building up its brand through advertising and developing new product ideas for distributors and jewelers. Suddenly couples were buying three-stone rings to celebrate the past, present and future of relationships. Men were buying rings designed with a male fl air. Women were buying “right hand” rings as symbols of independence. By 2001, the company’s diamond business was valued at $9.3 billion, up from roughly $1 billion just two years earlier.

Grocery chain Tesco has managed to exploit underused capabilities. Earlier than others, Tesco understood the competitive advantage of superior logistics and replenishment. Indeed, having the right item on the shelf when shoppers reach for it has made Tesco the leader in UK's hypercompetitive grocery market. “We focused first on distribution capabilities,” explains Lord Ian MacLaurin, the former CEO. “We eventually became so good that we could run smaller stores efficiently that others could not.” The thread that runs through each of these examples is that, frequently, the secret to a company’s renewal doesn’t have to be a risky new venture. Rather, like Spider- Man, it can be an under-tapped asset, just waiting to be unleashed. The trick for the mere mortals who occupy corner offices is to identify what hitherto unrecognized platforms, capabilities or customer insights they may be sitting on that can launch a new wave of growth.

For Complete IIPM Article, Click on IIPM Article

Source : IIPM Editorial, 2007

An IIPM and Professor Arindam Chaudhuri (Renowned Management Guru and Economist) Initiative

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