rajni ibm presentation

8/3/2019 Rajni Ibm Presentation

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Global sourcing is a term used to describepractice of sourcing from the global market

for goods and services across geopolitical

boundaries. Global sourcing often aims toexploit global efficiencies in the delivery of a

product or service. These efficiencies include

low cost skilled labor, low cost raw material

and other economic factors like tax breaks and

low trade tariffs.


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Common examples of globally sourced products

or services include :

1. labor-intensive manufactured products produced

using low-cost Chinese labor.

2. call centers staffed with low-cost English

speaking workers in the Philippines and India,

and IT work performed by low-costprogrammers in India and Eastern Europe.

3. clothing and shoes manufactured in China and

Thailand.


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Global GDP Growth 2% In 2003, 2002 And

2001 While 4% In 2000 And 1999

World Trade Growth Has Slowed

Every country wants to improve GlobalTrade


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Some advantages of global sourcingare:- Learning how to do business successfully

in a new market.

Finding and developing alternate suppliersources to reduce costs and stimulatecompetition.

The opportunity exists to locate scarce

skills and resources not available orunproductive at home thereby increasingmanufacturing capacity and other technicalcapabilities.


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. Monitoring costs go up and there arehidden costs relating to the effort and timespent learning about different cultures andtime zones.

especially in the beginning. There isexposure to financial, political and legalrisks, often in emerging economies

. In the service industries there is also a realrisk in losing a grip on your intellectualproperty.


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India Went Through Economic ReformsFrom

1991. The major ones are: Reductions In Import Duty Removal of restrictions on imports Devaluation of Currency Removal of permissions on setting up

enterprises and expansion of capacity Removal of permission of Controller of

Capital on Share Premium Account on issuesof Shares

Privatization of Public Sector UnitsMembership of WTO

Easier entry of multinationals


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Visualization of Six Major Global Players U.S.A. Japan Europe Russia

China India

Goldman Sachs Report (Brazil, Russia, India, China BRIC major players). Projects India as a potentialwinner ahead of China and would overtake U.S.A. and

China by 2025 in terms ofReal GDP.

India huge market population of 1 Billion with at least250 Million middle class with tremendous buying powerEconomy with 6% Growth Post Liberalization


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High growth but problem of

unemployment.

Need to generate 10 million jobs per

year.

Multi party rule, hence need toaccommodate political ideology with

economic reality (reservation, labour

law reforms).


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Beverages (Coke, Pepsi) Fast Foods (McDonalds, Pizza Hut, KFC) Coffee (Barista, Caf Coffee Day) Sports Wear & Goods (Nike, Adidas)

Apparels & Garments (Levis, Reid & Taylor) Cosmetics (Revlon, Oriflame, Maybellene) Two/Four Wheelers (Honda, Toyota, Suzuki, Hyundai,

General Motors, Ford, Mercedes) Computers (Del, HP, IBM, Samsung, Sony, Compaq) White Goods (LG, Samsung, GE)

Construction Engineering Companies Pharmaceuticals (US, Europe, Britain) Music (Sony, BMG, Warner) Entertainment Channels (Star, National Geographic,

Discovery, Sony)

Sourcing (IKEA, Adidas, Nike, many others)


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Enterprises In Wealth Creation

Government In Revenue And Employment

Employees In Development And Increase InStandard Of Living

Customers - Value For Money (Choice,

Affordability And Speed)

Stakehoders profit


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Easy Availability Of Imported/ForeignCollaborated Locally Produced Consumer

Items Plus Consumer Durables.

Reliable Communication System Of

Telephone (Landline And Mobile), E-mail

Availability Of Large Number Of Qualified

Youth In Most Disciplines

State Governments Trying To AttractInvestment By Offering Incentives / Benefits


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Speedy Mode Of Travel AndTransportation

Economic Growth Of 6%MNCs Have Entered The Market Both For

Sourcing As Well As Selling Their Products

Well Established And Developed Stock

ExchangeGrowth In Automobile, IT, Construction,

Pharma, Telecom, Energy, EntertainmentAnd Service Sectors

Foreign Exchange Reserves Presently AtUS$ 120 Billion With US$ Pegged BetweenRs. 45/- And Rs. 46/-


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Presently No Change In Existing Labour

Laws

Manufacturing Companies have

restructured and downsized (Engineering,

Metals, Cement, Electrical Machinery,

Textiles)

Lot Of Companies Offered Voluntary

Retirement Schemes (VRS) And Reduced


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Shift In Employment From Large

Companies To Medium And Small

Companies

Shortage Of Power Continues In Spite of

Investment in Power

Qualified Persons Are Prepared to Work at

Lower Level Jobs


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Threat Of Imports Easy Availability Of International BrandMNCs Have Deeper Pockets

MNCs R&D, Systems Pressure To Improve Operational

Efficiency Business Houses Also Expanding (Reliance,

Adity Birla, M&M, Tata Motors, AsianPaints, Ranbaxy, Cipla, Dr Reddys) Export Market Potential Innovative Marketing Strategy

Innovative IR

AndHR


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1. Strategy To Be Effective, Price Sensitive,Market Adaptive And Customer FriendlyThrough :

Restructure Sources And Uses Of Funds No Place For NPAs

Tight Control On Working Capital

Efficient Management OfRaw Material, WIP, FinishedGoods

Suppliers And Subcontractors

Utilization Of Manufacturing Plants

Distribution Channel

Manpower


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Collaborations, Mergers, Acquisitions (Eg.

Pharma, Cement, Aluminium, Telecom)

Niche Markets. World Class Manufacturers

(Titan, Sundaram Clayton)

Tackled Onslaught Large Companies

(Reliance, Nirma, Piramal Health Care, Dr.Reddys Laboratories, Ambuja Cement, Bajaj

Auto, Jet Airways, NTPC, BHEL, L&T,

Aditya Birla Group, Asian Paints)

Strong Brands (Wagh-bakri, Vadilal, Frooti,

Real, Rasna, Bisleri, )


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Companies in India That Have Successfully

Met Competition by Multinationals &

Domestic Companies Had A Spirit OfInnovation Not Only In Their Products And

Services But Also With Reference To All Their

Resources And Effectively Restructured Them

In A Time And Cost Frame And MetCustomer Needs And Improved Their Top

And Bottom Line


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