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CASE :XYZ Electronics
Scripting the 2nd edition of their India strategy
After a very successful stint in India, Williams, the Managing Director of XYZ's
Indian operation during 1998-2001 was ready to relinquish the position to Raj.
Williams was leaving India as a satisfied man, not only because he was promoted
as Vice President of global sales and marketing of XYZ's display products, but
also for having setting XYZ India on a firm foundation. XYZ India had just
completed another year of stupendous progress. It closed the calendar year
2000 with a turnover of Rs. 2,000 crore, from last year's turnover of Rs 1,400
crore. Net profit during the year was up from Rs 30 crore to Rs 45 crore. In 2001,
XYZ India projected a turnover of Rs 2,900 crore with a net profit of Rs 85 crore.
By 2003, XYZ was aiming to be one of the top three electronics companies in
India with a turnover of Rs 5,075 crore (5 percent of XYZ Electronics global
turnover). Understandably Raj was quite upbeat as he took the reins of XYZ's
Indian operations heading both XYZ Electronics India Limited and XYZ
Electronics India IT & Telecom.
Most interesting was the fact that all of these achievements and targets were in a
market, which had not been looking so promising. Consumer durables market
was going through a rough patch with slower sales off take, general price erosion
and tough competition. Sluggish domestic demand and a slowing global
economy coupled with slower exports, lack of spending on infrastructure and
political uncertainty affected overall industrial growth. The forecast of the
economy was not very encouraging. Any immediate upturn was unlikely. Then
why was Raj' ...