The New Masters of Management-Ashmita

8/8/2019 The New Masters of Management-Ashmita

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The new masters of management

DEVELOPING COUNTRIES ARE COMPETING ON

CREATIVITY AND COST .

THAT WILL CHANGE BUSINESS EVERYWHERE.


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INTRODUCTION

Japan took over America to become the worlds

leading car producer

lean manufacturing Japan transformed tself from low-wage economy to

hot-bed of business innovations.

Chinas annual growth rate has been more than10%and Indias more than 8%

Redesigning of entire business processes

Sarina


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competing for future

Rich world is losing its leadership

More research and development in emerging

market(R & D)

More time on the Internet

Appling classical principles of Division of labour

and Economies of Scale

Use of technological and business-model

innovation to produce new categories of services

Sarina


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hope versus fear

More access to goods and services

Not just Colorful but Steriodal-Anand Mahindra

Clever jobs will stay at home

Disruptive innovations will shake many industries

to their foundation Scream for protection

Sarina


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Chain Reaction

Osama's nuclear parade to ease the current obstacles andhinderances.

Successful arms treaty with Russia, recast Americas own nuclearpolicy, and a new summit in Washington DC.

Summit was basically focused on restatement of policies that isunder miserable conditions since are not put into action.

Administrations declaration for restraining nuclear weapons atnon- weapon states under NPTs rules was criticised either for

being unwise or misleading. Obamas health care reform was highly successful.

Mamata


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Chain Reaction

Nuclear diplomacy jammed by chronic disagreements has frayedthe collective faith that sustains NPT.

If a state fears its enemies will develop nuclear weapons, it has areason to go ahead by launching a program of its own. Mr.

Obamas consensus building is supposed to stop these practicesbut is just a start.

Countries would be under tough inspections and punishment forviolating NPTs regulations. For example: North Korea.

Ban on tests and on making uranium and plutonium for bombs.

Agreement on sanctions against Iran for undergoing nucalearpractices, though stopping Iran seems quite hard.

Mamata


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The World Turned Upside Down

Developing countries (becoming hot beds for business innovation).Reasult of business innovation not industrial policies or statesubsidies. Example: Japanese beat Americans on both price andrealibility.

Local companies: dreaming bigger dreams and operaating in globalmarkets, coming up with cheaper products and services than that ofwestern companies.

Greater economic growth in India and China, brain power relativelycheaper and abundant than in west.

Old assumptions about innovation are also being challanged.Western companies are embracing polycentric innovation as theyspread their R & D centres around the world.

Non western companies are becoming power house of everythingfrom telecoms to computers.

Mamata


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First Break all the rules

The charms of frugal innovation

Company should adapt their products as per customers need. They mustconcern about the budget, religion of the customer.

Frugal products need to be tough and easy to use. Its market is growing

rapidly.

Companies need to squeeze costs so they can reach more customers, and

accept thin profit margin to gain volume.

The first way of reducing costs is to contract out ever more work.

Second money saver is to use existing technology in imaginative new ways.

And, the last way to cut costs is to apply mass production techniques in new

and unexpected area such as health care. Company should not neglect the quality of product and should always be

ready on order fulfillment.

Innovations which are cheap enough for lower community as well as

fashionable enough for young professionals can gain profit.

Asmita Dahal


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Easier said than done

Emerging-market consumers are hard to reach

Researchers must discreetly monitor consumers reaction from behind one-way

mirrors.

Emerging markets are far more varied and volatile than mature ones.

Cultural complexities are confounding and tastes are extra-ordinary fluid. People who

are not used to brands flits easily from one to another.

Companies always come up with new products, or tweak old ones, to suit local tastes

and meet personal preferences.

Innovation extends to changing entire business models.

Companies in search of large fortune at the bottom of the pyramid have to start not

with consumers but with non-consumers. They need to got inside poor peoples head to

develop new markets, shaping peoples tastes and establishing habits.

Companies should give priority to local people to benefit.

New technology can also work wonders for distribution.

The most difficult trick of all is what some call straddling the pyramid or Playing

the piano : serving both the people at the bottom of pyramid and those at the top.

Asmita Dahal


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Grow,Grow,Grow

Emerging world is enjoying the most spectaculargrowth in history.

Emerging countries shaking off the recession as

developed countries continue to struggle.Developing world champions have risen from hero to

zero.

Kiran Khatri


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Have the spirit of a frontier settler.

Growth is forcing firm to engage in relentless

innovation.1.Merge and acquisition

2.Recuruitment and retention

Maharajahs place in mysore compare withinfosys.

1.largest corporate university

2.mantra is no caste,no creedonly merit

Kiran Khatri


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Infosys challenge IBM

China and India boast a huge number of cheap

brain worker.

Talent should be relentlessly managed.

Kiran Khatri


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Here be dragons Journey will help us to discover the unknown species and

many invaluable material about evolution. Business travellers in todays emerging markets know many

thing about exotic corporate species, new and unfamiliarkinds of business.

Almost all emerging countries have desire for highlydiversified conglomerates. For instant: Indias Tata Grouphave many subsidiaries from Car making, agricultural

chemical and Reliance Industries.

Most of the state-owned enterprises in the emerging

countries are peculiar Hybrids i.e. they depend onGovernment for borrowing money and also plunging into theglobal market.

For instant: China and Russia: Most of Hybrid companiesenjoy various legal privileges but this could not happen in

Latin American and Middle East countries.tshering tamang


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Here be dragons(contd..)

Hybrid organizations are more prominent for energysector. They are controlled by Government and often

diversified.For instant: Worlds 13 largest Oil companies, Chinas

China Telecom and Lenovo.

Adapt and surviveDiversified conglomerate can adapt to environmental

challenges like political and financial risks.

For instant: Tarun Khanna of the Harward Business

School and Tata Group have similar characteristics. Authoritarian Government can use state-ownedcompanies to direct economic activities. From this,

local entrepreneurs and even multinational companies

can gain various business opportunities.tshering tamang


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Inefficiency of capital market for conglomerates is only thereason for diversification. Talent shortages and brand buildingare also the reason for diversification.

For instant: Tata Groups brand is worth about $2.2 billion.

Hybrid companies are inherently confused organization in thesense that whether they are responsible for State or market

place but they are subjected to political and culturalinterfering.

Hybrid organization has lower productivity than privateorganization.

Due to financial melt down, emerging markets are disposedtoward Anglo-saxon model and due to this they are most

favorable for Government. tshering tamang


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Learning from the masters

Rethinking economics of scale:

- to reduce unit cost by centralizing manufacturing & producinglong run standardized items.

For instant: Nutriset, Clinics on wheels, Kenyas Child andFamily Wellness

Takes an equally contrarian approach to product:

- there are two models: Push model and Pull modelPush model which allocate resources to the areas of expected

demand and

Pull model which prevails and designed to help companiesmobilize resources when the need arise.

Pull model help to change the nature of companies and also helpto become loose network for reconfiguring themselves.

Application of mass production technique to sophisticated services.

This innovative business model demonstrate economies of scale

and scope could be reaped from services. tshering tamang


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Here be dragons(contd..)Learning from the masters

Rethinking economics of scale:

- to reduce unit cost by centralizing manufacturing & producinglong run standardized items.

For instance: Nutriset, Clinics on wheels, Kenyas Child andFamily Wellness

Takes an equally contrarian approach to product:

- there are two models: Push model and Pull modelPush model which allocate resources to the areas of expected

demand and

Pull model which prevails and designed to help companiesmobilize resources when the need arise.

Pull model help to change the nature of companies and also helpto become loose network for reconfiguring themselves.

Application of mass production technique to sophisticated services.

This innovative business model demonstrate economies of scaleand scope could be reaped from services.

tshering tamang


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NEW MASTERS OF MANAGEMENT

Pervasive innovation adds up to a new management paradigm


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Business innovation and frugal production are part of new

approach to management . The new management paradigm pushes ideas beyond the

previous limits.

The customer is the king.

Economies of scale can produce radical reduction in unitcosts.

Most companies in developing countries have opportunities

for mergers and acquisitions that did not exits few decades

ago.

The evolution of new paradigm is strikingly reminiscent of

earlier management paradigm.

Nirjala


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Objections to new emerging market paradigm in

particular

1. There is nothing new, it is just the modern versions.

2. There is arguably no such thing as a single emerging market,

let alone an emerging- market paradigm.

3. Overselling of emerging markets.

Nirjala


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The genius of the sandwich

The first objection contains an element of truth:none of this is

new. It is just putting ideas together in new ways.

The second objection also has some truth to it. But,emerging

markets have something in common like similarchallenges(such as large numbers of poor people),similar

opportunities(such as large number of rapid economic growth).

The emerging companies are learning on how to compete on

productivity, not just the cost.

The emerging market firm are leapfrogging Western ones.

High-level and low-level innovation are often combined to

excellent effect in emerging markets.

Nirjala


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The Power to Disrupt

The Third World

>The term 'Third World' arose during the Cold War to

define countries that remained non-aligned or not

moving at all with either capitalism and NATO(which along with its allies represented the First

World) or communism and the Soviet Union (which

along with its allies represented the Second World). >Third world is known as emerging market.

Prem Bd. Budha


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>Disruptive innovation refers to new process that slashes prices

for new products and radically change the way they are made

and delivered.

>Disruptive innovations hail from the emerging market.>Four ways to move things faster and further:

*Today's markets for corporate control and managerial

talents are much more liquid than they were 20 years ago.

*Sheer size of the emerging markets.

*Emphasis on the volume.*West's best companies have grasped the potential of

emerging markets.

The age of profligacy is giving away to the age of austerity

>Productive strategy for a company is Cost Innovation rather

than Cost-Cutting which is now experienced from the practice in

emerging market.

Prem Bd. Budha


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Shifting the Centre of Gravity

>Frugal innovation

>Although the average Western Company is much bettermanaged than the average emerging world company, reverse

engineering and frugal innovation learnt from emerging market

are taught in Western Business School.

>Nowadays, center of gravity has been shifted to emergingmarkets.

>Emerging markets actually are the basis of business

innovation

Prem Bd. Budha


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The Trillion Dollar Club

The BRICs


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y BRIC is an increasing popular acronym which refers tothe nations of Brazil, Russia, India and China.

y BRICs are the emerging market with annual GDP ofover $1 trillion.

y The BRIC nation markets carry with them greater risk,but at the same time may have greater potential forgrowth.

y These countries are playing major role in the currentglobal downturn.

Anup Shakya


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BRIC are among the ten largest accumulators of foreign

exchange reserve.

1/6 of the reserve can create a fund the size of IMF.

China is the worlds largest exporter. BRICs countries areincreasing their trade by supplying goods and services with

one another.

China is the largest emitting of CO2, Russia is third and

India is fourth.

Anup Shakya


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.

Western governments -

An area that could be rescued from poverty only by a

combination of donations from the rich world. Van was uncomfortable with the banking industrys contempt

for the developing world.

China and Vietnam gradually improving themselves at that

time. Start of big companies in developing world.

CEMEX cement company ofMexico.

ACER - Pc manufacturing of Taiban.

ARACRUZ - pulp producer ofBrazil .

SAMSUNG - electronic goods maker of S.Korea.

Arjun Bhetwal


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.

America and its allies have been in top of the world for so long

that - it will take a huge psychological adjustment to treat the

likes of India and China as economic equals.

Samuel Huntington predicted a clash of civilizations and

hopes creative collision that will lead to innovation.

Arjun Bhetwal


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BRICs

B - Brazil

R - Russia

I - India

C - China

coined byMr. O Neill.Comments

Why Brazil in andMexico out?

Why Russia in ?

Should S.Africa , Mexico , Indonesia Join? Russia looks like odd man out etc?

Arjun Bhetwal


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The BRICs are the product of great recession

Why they notified ?

- Because of the recessionary debate about re-balancing the

world economy.

In conclusion,

BRICs are a good mechanism for pressing rich countries to

change their role in managing the global economy more

radically. Firms in the rich world have not fully digested the rise of the

emerging markets.

A

rjun Bhetwal

Documents

The New Masters of Management-Ashmita