Sample: Implementation of International Business Strategy, Results from IT Company: BC Co.
4.2 Results from IT Company: BC Co.
The IT Company surveyed for this research is a combination of telecom and IT services. BC Co. has a leading presence in India since the early eighties. The large presence of the company can be seen in the indirect workforce supporting different market unites of the company like BC Retail, and BC Global. India is the only country outside UK that plays a key role in supporting BC Co. which tap the talent in India for cost innovation.
When asked about the country-specific strategies adopted by BC Co. while operating in India it was reported that the company operates a global operations centre to run as a captive unit that offers various skills for supporting the global operations of the company. Then the company uses its domestic dales and provides support to the force of field for handling the customers of the company. The executives of the company regard India as a strong sourcing base for the company and have undertaken the development that has resulted in creation of intellectual property for software services and management for the platforms of the company at the global level. The company works with the business model through which it helps the companies to globalize as it manages their network and IT services as they expand in new markets such as India.
The executives reported that in order to operate in international markets especially in India it is necessary to go for local linkage for being successful in these markets. BC Co. has set up local manufacturing units and marketing and service providing centers on a countrywide basis. Additionally the focus has been remained on providing the cutting edge products and IT solutions in India and that too after studying the Indian environment in detail and understanding the exact marketing conditioned of the country. It was realized that the local partners of the company have the necessary knowledge and capabilities for reaching the targeted developing country markets. Most of the executives of the company were found to be very much concerned about their unit's familiarity with the local markets and consumers and are fearful that transferring existing biases may affect the business of the organization negatively. Therefore the company decided to start up its venture in a country where it was not having any local subsidiary. One of the respondents reported that this opportunity is considered as a learning market where the situation is not to control but to keep it simple and flexibility is to be maximized.
Further the managers of the company reported that it was inappropriate to apply the basis company model of international expansion in Indian environment. There is a need to do much more than leveraging the existing internal capabilities of the company and the success of a strategy depends much more than on adaptation of standard entry strategies. The executives of the company acknowledge the necessity of identifying the partners who have appropriate knowledge in relation with the context. The executives interviewed from HR department of the company reported that they have looked for accessing external competencies from various areas in the country. The company followed the partnership model that helped the company in recognizing several potential partners who were working with string social mission also. This meant that BC Co. should incorporate the social as well as economic performance goals to be successful in Indian markets and this expanded the traditional metrics of the company as a whole.
The strategic department of the organization reported that the company made efforts to provide the required business flexibility to the local teams working in India so as to smoothen the strategic decision making process. The respondents from personnel department also reported that a high level of trust is required to take right decisions and ensure the flow of decision making authority through localization. They explained that it is not enough to develop a local team and provide them regular training but it is essential that the local team are directed to create credibility. BC Co. has achieved this objective through making the teams develop innovative solutions and ensure proper knowledge transfer and sharing to demonstrate the ability of devising sound innovative business models for adapting to local challenges of a developing country. This helped BC Co. to transfer decision power to teams operating locally in India.
The company has established its international customer relationship office in India that has proved to be a source of success for the company. It has people on the ground for supporting the customers. This support staff comprise of account managers, service managers and a single point of dedicate contact. A key feature of the company's operations is that the customers of the company are directly linked to the world leading global IP network of BC Co. and it uses a global customer service model for supporting for all its customers from all the locations around the world.
The respondents from the HR department revealed that the success of BC Co. is based on the empowerment of the local management of the company. The company took several initiatives to build for the long term in India regarding people, HR practices and relationships with the stakeholders of the company. It also defined a value added role for the management of the business in India and establishes credibility of the local team for leveraging Indian opportunities beyond the product markets. The company allowed fine tuning of its metrics for fitting itself to the realities of Indian markets and sets the organization for taking full advantage of Indian opportunity. It has been reported by the respondents that the cost of expatriate mangers proves to be significantly higher than the talent available locally. While operating in developing countries cost factor is most important consideration as an increase in cost will be transferred to the final consumer in the form of high price of the final product sand in a developing nation like India people may not be able to afford very highly priced products that may result in a failure of the products as a whole.
Additionally a discontinuity in strategy may result due to mobility of high expatriate and thus the company has always relied on local talent to work for the organization. This has also helped in avoiding much of the resistance that may arise among individuals of different backgrounds and working styles working together and local teams have proven to be much more efficient in managing eth local workforce. Furthermore the local managers have proven to be more effective at managing the relationship with suppliers and distributors. The benefits of developing high quality local teams and local linkage have been considered by the executives at all levels at BC Co. and the workforce of the company believes that local teams have an in depth understanding of the Indian environment and the tastes, nature and preferences of the consumers in the country. Additionally local managers have seen to be positioned in a better manner for designing of products and business models that are tailored as per the nature of Indian markets. The executives of the production department reported that they get the required support and advice from the headquarters along with the required training to design the products but a local team is inevitable for the successful execution of the plans of the company.
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