Case Study Description of Mastering the Make-in-India Challenge
This is an MIT Sloan Management Review article. Despite India's economic growth and potential, developing a successful strategy for the country remains one of the most complex challenges for foreign multinationals. This challenge is rooted in the hard realities of global scale and costs. Most foreign executives have found it difficult to make money in India with their existing product portfolios at the scale of operations dictated by local demand. In addition, India has not provided foreign direct investment incentives anywhere near those of neighboring China. However, U.S. management consulting firm A.T. Kearney estimated in 2014 that India's share of global trade would be approximately five times greater by 2025 -and at that point would represent 6% of all global trade. Given that growth projection, waiting for a target income segment to reach the break-even level or waiting for greater government incentives to materialize is not the right strategy. Indeed, the authors observe, many foreign multinationals have increased their focus on India. However, they add, many foreign executives are frustrated that they cannot replicate the same strategies in India that led to success in China. One reason is the local high-income segment, which constitutes the initial target market for most foreign companies, is relatively small in India compared with China. This often causes foreign executives to refrain from investing in more extensive value-chain activities in India and delay committing to local manufacturing. Based on their research, the authors present a framework for foreign multinationals for a successful first-time entry into India or for upgrading an existing operation in India that has not been very effective. This approach involves simultaneously taking advantage of local sourcing, manufacturing, and marketing activities in conjunction with local adaptation of global products to generate mutually reinforcing advantages. Foreign manufacturers in India, the authors argue, can use both globally focused assets to improve local sales and locally developed capabilities to deliver more cost-effective solutions for global markets. This combination enables companies to reach across all of India's income segments, while at the same time developing a springboard for global exports.
Authors :: Haritha Saranga, Ram Mudambi, Andreas Schotter
Swot Analysis of "Mastering the Make-in-India Challenge" written by Haritha Saranga, Ram Mudambi, Andreas Schotter includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Foreign India facing as an external strategic factors. Some of the topics covered in Mastering the Make-in-India Challenge case study are - Strategic Management Strategies, Supply chain and Global Business.
Some of the macro environment factors that can be used to understand the Mastering the Make-in-India Challenge casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, there is backlash against globalization, talent flight as more people leaving formal jobs, competitive advantages are harder to sustain because of technology dispersion, digital marketing is dominated by two big players Facebook and Google, geopolitical disruptions, increasing household debt because of falling income levels,
cloud computing is disrupting traditional business models, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Mastering the Make-in-India Challenge
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Mastering the Make-in-India Challenge case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Foreign India, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Foreign India operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Mastering the Make-in-India Challenge can be done for the following purposes –
1. Strategic planning using facts provided in Mastering the Make-in-India Challenge case study
2. Improving business portfolio management of Foreign India
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Foreign India
Strengths Mastering the Make-in-India Challenge | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Foreign India in Mastering the Make-in-India Challenge Harvard Business Review case study are -
Effective Research and Development (R&D)
– Foreign India has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Mastering the Make-in-India Challenge - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Training and development
– Foreign India has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Mastering the Make-in-India Challenge Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
High switching costs
– The high switching costs that Foreign India has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Ability to lead change in Global Business field
– Foreign India is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Foreign India in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Low bargaining power of suppliers
– Suppliers of Foreign India in the sector have low bargaining power. Mastering the Make-in-India Challenge has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Foreign India to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Foreign India is one of the most innovative firm in sector. Manager in Mastering the Make-in-India Challenge Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High brand equity
– Foreign India has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Foreign India to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Analytics focus
– Foreign India is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Haritha Saranga, Ram Mudambi, Andreas Schotter can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Ability to recruit top talent
– Foreign India is one of the leading recruiters in the industry. Managers in the Mastering the Make-in-India Challenge are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Diverse revenue streams
– Foreign India is present in almost all the verticals within the industry. This has provided firm in Mastering the Make-in-India Challenge case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Highly skilled collaborators
– Foreign India has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Mastering the Make-in-India Challenge HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Foreign India has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Foreign India has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Weaknesses Mastering the Make-in-India Challenge | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Mastering the Make-in-India Challenge are -
Products dominated business model
– Even though Foreign India has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Mastering the Make-in-India Challenge should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Foreign India is dominated by functional specialists. It is not different from other players in the Global Business segment. Foreign India needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Foreign India to focus more on services rather than just following the product oriented approach.
Skills based hiring
– The stress on hiring functional specialists at Foreign India has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Foreign India has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Mastering the Make-in-India Challenge, in the dynamic environment Foreign India has struggled to respond to the nimble upstart competition. Foreign India has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High operating costs
– Compare to the competitors, firm in the HBR case study Mastering the Make-in-India Challenge has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Foreign India 's lucrative customers.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Foreign India is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Mastering the Make-in-India Challenge can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High bargaining power of channel partners
– Because of the regulatory requirements, Haritha Saranga, Ram Mudambi, Andreas Schotter suggests that, Foreign India is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Slow to strategic competitive environment developments
– As Mastering the Make-in-India Challenge HBR case study mentions - Foreign India takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
No frontier risks strategy
– After analyzing the HBR case study Mastering the Make-in-India Challenge, it seems that company is thinking about the frontier risks that can impact Global Business strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Mastering the Make-in-India Challenge, it seems that the employees of Foreign India don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Opportunities Mastering the Make-in-India Challenge | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Mastering the Make-in-India Challenge are -
Developing new processes and practices
– Foreign India can develop new processes and procedures in Global Business industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Leveraging digital technologies
– Foreign India can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Foreign India can use these opportunities to build new business models that can help the communities that Foreign India operates in. Secondly it can use opportunities from government spending in Global Business sector.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Foreign India to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Foreign India to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Foreign India in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Global Business segment, and it will provide faster access to the consumers.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Foreign India is facing challenges because of the dominance of functional experts in the organization. Mastering the Make-in-India Challenge case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Global Business industry, but it has also influenced the consumer preferences. Foreign India can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Low interest rates
– Even though inflation is raising its head in most developed economies, Foreign India can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Building a culture of innovation
– managers at Foreign India can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Global Business segment.
Using analytics as competitive advantage
– Foreign India has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Mastering the Make-in-India Challenge - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Foreign India to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Foreign India can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Creating value in data economy
– The success of analytics program of Foreign India has opened avenues for new revenue streams for the organization in the industry. This can help Foreign India to build a more holistic ecosystem as suggested in the Mastering the Make-in-India Challenge case study. Foreign India can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Foreign India in the consumer business. Now Foreign India can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Mastering the Make-in-India Challenge External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Mastering the Make-in-India Challenge are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Foreign India in the Global Business industry. The Global Business industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Foreign India business can come under increasing regulations regarding data privacy, data security, etc.
Shortening product life cycle
– it is one of the major threat that Foreign India is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Technology acceleration in Forth Industrial Revolution
– Foreign India has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Foreign India needs to keep up with the evolution of technology in the Global Business sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Consumer confidence and its impact on Foreign India demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Foreign India.
Increasing wage structure of Foreign India
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Foreign India.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Foreign India will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Foreign India with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Foreign India can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Mastering the Make-in-India Challenge .
High dependence on third party suppliers
– Foreign India high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Easy access to finance
– Easy access to finance in Global Business field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Foreign India can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of Mastering the Make-in-India Challenge Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Mastering the Make-in-India Challenge needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Mastering the Make-in-India Challenge is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Mastering the Make-in-India Challenge is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Mastering the Make-in-India Challenge is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Foreign India needs to make to build a sustainable competitive advantage.
