8/10/2019 Globality

1/32

COMPETING WITH______________

FROM ________________

FOR __________________

BY

HAROLD L. SIRKIN

JAMES W. HEMERLING

ARINDAM K. BHATTACHARYA

GL BALITY

8/10/2019 Globality

2/32

COMPETING WITH EVERYONE

FROM EVERYWHERE

FOR EVERYTHING

BY

HAROLD L. SIRKIN

JAMES W. HEMERLING

ARINDAM K. BHATTACHARYA

GL BALITY

8/10/2019 Globality

3/32

GLOBALITY

TSUNAMI CONCEPTSTRUGGLES

CHALLENGERS

GROWING PEOPLE

LOCALIZING

STEPPING INTO NEW MARKETS

CONNECTING

WITH CUSTOMERS

REINVENTING

THE BUSINESS

MODEL

RETHINK

RECONFIGURE

REINVENTBUILDING BRANDS

ADAPTING CHOOSING

GLOBAL PRESENCE

GLOBAL TRANSFORMATION

SUCCESS

IN GLOBALITY

8/10/2019 Globality

4/32

Graduated from Cornell with a degree

in Architecture in 1962then flew

back to India and joined the family

firm

which was a trading companyin 1868 started by his great grand-

father.

He made it a mission to modernize and

internationalize his company and alsohelp India open its borders and its

mind to worldwide business.

8/10/2019 Globality

5/32

INCLUDES:

INFORMATION AND COMMUNICATIONTECHNOLOGY

CHEMICALS

HOTELS

AUTOMOTIVE AND STEEL

TODAY TATA GROUP HAS A MARKET CAPITALIZATION OF $50

BILLION AMD MORE THAN 50% OF ITS $50 BILLION ANNUAL SALESIS FROM OUTSIDE INDIA.

WE NO LONGER DICUSS THE FUTURE OF INDIA says Kamal

Nath(countys minister of commerce),

But we say

THE FUTURE IS INDIA

8/10/2019 Globality

6/32

Raw materials

Capital

Knowledge

Capabilities

Most importantly: LEADERS, MANAGERS,

WORKERS, PARTNERS, COLLABORATORS,

SUPPLIERS AND SO ON.

CUSTOMERS

8/10/2019 Globality

7/32

Shirts are stitched in Romania

Our apricots are harvested in Turkey

The computer help-line staffed from India

Laptops assembled in China.

THATS HOW THE

GLOBALITY ASPECT ISDEPICTED BY THE

AUTHORS.

8/10/2019 Globality

8/32

Set of competitors from the developing

economies have risen up and challenged

the established players of the developed

markets.Wave of global challengers from the

rapidly developing economies is far

bigger and much more significant. And

will have greater effect on the world.

8/10/2019 Globality

9/32

THE UNIQUE ORIGINS OF THECHALLENGERS

THE UNPRECEDENTED GLOBALACCESS THEY HAVE ENJOYED

THEIR HUNGER FORACHIEVEMENT

8/10/2019 Globality

10/32

Country origins of China and India in particular

are very different from those of the United States,

Japan, or Korea.

Massive countrieshuge populationabundantlow wage workforcepotential markets

resource providers.

8/10/2019 Globality

11/32

Access to everyone, everywhere and everything

that the challenger companies have enjoyed.

Worldwide communications

Nets and international laws and policies favorableto commerce.

Information, data, talent, organizations, capital,

systemsit is all available at a click of a mouse

Cell phone connection.

8/10/2019 Globality

12/32

Hunger of the people in rapidly developing

economies for learning, improvement,

achievement, success, and recognition.

People in the rapidly developing economies thinkand act differently than those in the developed

economies.

8/10/2019 Globality

13/32

MINDING THE COST GAP

GROWING PEOPLE

REACHING DEEP INTOMARKETS

PINPOINTING

THINKING BIG, ACTING FAST,

GOING OUTSIDE

INNOVATING WITH INGENUITY

EMBRACING MANYNESS

8/10/2019 Globality

14/32

Sometimes cost efficiency turns into a disadvantage :

Commodity suppliers wanting to become full fledgedglobal competitors often dont have control over lowcost.

To overcome this disadvantage they can concentrate oninnovation and brand legacy, to offset the cost

difference. Keeping an eye over the cost differential Is the most

important.

ACTIONS THAT CAN BE TAKEN:

Optimizing with labor

Clustering

Superscaling

Simplifying

8/10/2019 Globality

15/32

The developing economies are supposedly flooded with

educated and skilled workers and managers while, in thedeveloped economies the talent pool shrinks and wages rise.

Struggle for talent increases

Main issue is the alignment of the work to be done with theright talent

Right people with the right capabilities is a huge task. EG: Infosys, a giant Indian outsourcing firm, is looking to

hire 6000 chinese employees over a period of the next5years.

ACTIONS: Recruiting for rapid growth

Developing for depth

Deploying for early results

Letting leaders build

8/10/2019 Globality

16/32

Rapidly developing economies are attracted not only by the size of

their population but also by the increasing wealth andsophistication of both industrial consumers and general marketconsumers.

However the incumbents are often confounded in their efforts toreach out to the deep markets due to inadequate understanding of

consumers, cultural differences, infrastructural lacks, brandlegacies, complex distribution and retail systems.

ACTIONS:

Creating new categories

Finding the sweet spot

Localizing

Distributing amid chaos

Doing business with business

Stepping into other markets

8/10/2019 Globality

17/32

INCUMBENTS

Thought of rapidlydeveloping countries aslow cost locations thatcan support only lowcost work.

CHALLENGERS

More relentless and even

ruthless about

scrutinizing the elements

of the value chain,breaking them into

discrete elements,

relocating them and then

folding them into theirbusiness processes in a

way that makes distance

and location seem

almost irrelevant.

ACTIONS:

Connecting with customersDistributing complexity

Reinventing the business

model

8/10/2019 Globality

18/32

Mergers, acquisitions, partnerships and joint ventures arepursued with an aim to increase scale, extend geographicalreach, add capabilities and other strategic purposes.

For challengers acquisitions in a speedy way to catch up witthe incumbents.

Challengers are young companies or former state ownedbureaucracies or midsize companies with few resources andout of date systems.

ACTIONS:

Scaling up Building brands

Filling capability gaps

Bartering

8/10/2019 Globality

19/32

Incumbents worry about innovation as much as they achieveit.

Engineers, designers, managers and marketers constantlythink about new products that could and should be createdand how the existing ones should be improved.

Challengers have not been associated with break through

innovation. Rather they are known as expert copiers,interpreters, simplifiers and adaptors of technology,products and services.

Challengers are practicing their own particular style ofinnovation. They have ingenuity.

ACTIONS:

Adapting

Leveraging

Rapid-fire inventing

8/10/2019 Globality

20/32

Incumbent companies have a bias towards standardization.

Struggle of globality is learning to live with and thrive onmanyness.

Globality encompasses use of more than one strategy fordifferent cultures, products and services, customers , times

and competitive situations. Manyness is an unfamiliar and even uncomfortable concept

foe those who are looking for a single strategy, idealorganization structure , the signature leadership style.

ACTIONS: Choosing global presence

Retaining local character

Polycentralizing

8/10/2019 Globality

21/32

THE STRUGGLE IS TO DETERMINE WHICH

MANAGEMENT PRACTICES FROM

DEVELOPED MARKETS CAN BE

SUCCESSFULLY TRANSPLANTED OR

ADAPTED FOR EACH DEVELOPING

MARKET AND SITUATION, WHICH ONES

MUST BE REJECTED, HOW TO TAKE

ADVANTAGE OF MANYNESS IN ALL ITS

FORMS.

8/10/2019 Globality

22/32

8/10/2019 Globality

23/32

Received undergrad education at Harvard

University and earned his MBA at Harvard

Business School.

Mahindra & Mahindra was founded on the beliefthat Indian are second to none in the global arena

and education is the key to their success.

If we use the power of the people after

education, there is no reason why we cant build acompany equal to the best

8/10/2019 Globality

24/32

Trade agreements like World trade Organization,

rise of distributors, big retailers, emergence of

sophisticated shipping and logistics facilitators,

role of internet in connecting everybody fromeverywhere with everything.

Challengers have sold tangible goods, from natural

resources to components to finished goods, by

working with established retailers in bothdeveloped and developing economies.

Access to global markets has helped jump-start the

Indian economy.

8/10/2019 Globality

25/32

8/10/2019 Globality

26/32

8/10/2019 Globality

27/32

8/10/2019 Globality

28/32

8/10/2019 Globality

29/32

Wipro has executed a blend of strategies centering

on Innovation.

The company has paired up the inorganic growthwith the organic expansion.

Wipro excels in talent management.

In conjuncture with BITS Pilani, a premier

engineering institute in India, its Wipro Academyof Software Excellence(WASE) that provides

masters degree in IT/ software engineering.

Reinvented its business models to drive its world

wide expansion.Wipros IT business boasts a global workforce of

more than 76000 employees

8/10/2019 Globality

30/32

Although companies like Wipro and many others,

achieved great success as service providers, India

has been less attractive as a location for global

manufacturers.

Not so rich domestic market

Frustrating infrastructure.

Bureaucratic red tape and restrictive policies.

8/10/2019 Globality

31/32

ONWARD TOINNOVATION

BIG BUILDOUT

MOVING UPTHE VALUE

CHAIN

8/10/2019 Globality

32/32

Globality tells remarkable stories of

companies that have achieved amazing

worldwide success by doing business in way

that bring together the best practices and

strategies of the west and the EastANAND MAHINDRA