E globuz z-vol1_issue_iii

ForewordDear Readers,

It gives me immense pleasure to bring to you the third issue of e-Globuzz, Jul-Sep'10. We hope you liked our previous issue of Jan-Mar'10.

There are those who envision, and then there are those who work to make the vision a reality. We are proud to say that we have a team which does both. We would like to thank all those who were involved in taking this issue to the completion stage.

Our next issue is planned in Oct '10, which we trust will be even more insightful as we try and evolve with every issue of ours. In future we plan to evolve by bringing in greater participation from the corporate executives, industry experts, alumni & faculty. We look forward to hearing from our readers. Please do send us your feedback at [email protected].

We have dedicated this issue to late Prof. C. K. Prahalad whose books & articles have been a guiding light for us and hence some of these articles and books have been referred to in this issue.

For everyone in the SIMSR family, Late Prof. C. K. Prahalad was a great source of inspiration; a role

model and an outstanding academician for whom we always had and will continue to have profound respect and admiration. We were shocked at the news of his untimely passing away in April 2010. We were looking forward to reading many more of his books and articles in respected international journals.

Some of us at SIMSR, the students and the faculty had the privilege to listen to his insightful speech in January 2010 when he addressed a packed auditorium at the seventh Nani A Palkhivala Memorial

Lecture in Mumbai. Little did we realize that for us it would be his last lecture, and we would not get the privilege to hear him again But late Prof. C. K. Prahalad lives on in our minds and in our hearts. We will

fondly continue to read again his various articles and books, which will continue to inspire us and guide us in our quest for achieving academic & professional excellence.

Another great quality of Late Prof. C. K. Prahalad which we greatly admire is his humility which he had inspite of his truly exceptional professional achievements as a leading & globally respected author and

consultant to several leading multinational enterprises. His humility is evident in the Preface of his book -authored with Prof. Gary Hamel of London Business School.

ranging from Kenneth Andrews, Igor Ansoff, Peter Drucker & Henry Mintzberg to Michael Porter &

Kenichi Ohmae- all of whose works on strategy are eagerly read by SIMSR students, alumni & faculty.

The International Business Society (IBS@SIMSR) pays its humble tribute to late Prof. C. K. Prahalad,

Paul and Ruth McCracken Distinguished University Professor, Ross School of Business, University of Michigan, USA.

Prof. C. P. JoshiFaculty Mentor-IBS@SIMSR

Course Coordinator- PGDM-IB

Team

e GlobuzzFaculty Mentor

Prof. C P Joshi

Editors

Vikash Kumar Singh

Anchal Sachan

Designers

Parul Shrivastava

Rachit Goel

Circulation

Astha Pasricha

Celia Madona Vincent

All the views expressed in

the magazine reflect the

personal opinions and

views of the authors and

do not reflect the

.

6COVER STORY:

BOTTOM OF THE PYRAMID

How Sustainable is your

Business?

01 Company In Focus: APPLE

04 Sector in Focus: Global Automobile Industry

06 Cover Story: BOTTOM OF THE PYRAMID

How Sustainable is Your Business?

08 Country in Focus: SOUTH AFRICA

10 Academic fraud in China

11 Report on Economic Freedom Network Asia

Conference 2009

13 International Marketing: COCA COLA scores a

winner

15 International Finance: Global Banking Scenario

17 Interview with Mr ROHIT PANDYA, Dy. General

Manager, Buyer and Country Underwriting, ECGC,

Mumbai.

19 Debate: - Will the European Union Sustain?

21 Did you know these terms?

22 Book Review: COMPETING FOR THE FUTURE

24 Crossword #03

e - GlobuzZ, Volume I, Issue III July September2010 Page | 1

INTRODUCTION

Apple Inc. (previously Apple Computer, Inc.) is an American multinational corporation that designs and markets consumer electronics,

computer software, and personal computers. The company's best-known hardware products include the Macintosh computers, the

iPod, the iPhone and the iPad.

Established on April 1, 1976 in Cupertino, California, and incorporated January 3, 1977, the company was previously named Apple

Computer, Inc. for its first 30 years, but removed the word "Computer" on January 9, 2007, to reflect the company's on-going

expansion into the consumer electronics market in addition to its traditional focus on personal computers.

Focused Differentiation Strategy

Earlier Apple followed a Focused Differentiation Strategy because

It was catering to a narrow market niche with unique needs

It adopted a premium pricing strategy to target high-end consumers and business market

Broad Differentiation Strategy

Now Apple has now moved towards Broad Differentiation Strategy after the introduction of i-phones and i-pods

It now offers a broad range of products to a larger number of consumers

Gives value to customers by differentiation

STRATEGIES FOR INNOVATION

following steps explain the techniques it uses for innovation.

APPLeCOMPANY IN FOCUS


Think Different

Apple maintains an introspective, self-contained operating style that is capable of confounding competitors and shaking up entire

industries. For example, Nokia, once considered the undisputed leader in mobile phones, never anticipated that a single product from

a computer maker might throw its ascendancy into question.

think differently about itself that keeps Apple at the head of the pack.

Build your fortress - Create the infrastructure needed for innovation

Size and sprawl are formidable challenges that most companies manage, either by splintering into disorganized, undisciplined

communities or by locking employees into tight, stifling bureaucracies. Apple tends toward the latter, but it does so in a unique way

ion with

secrecy is a double-edged sword, however: It gives Apple a vital element of surprise in the marketplace

Cultivate your elite - Empower your most valuable employees to do amazing work

, new products are often seen in their complete form by only a small group of top

executives. This, too, works as a strength for Apple: Instead of a sprawling bureaucracy that new products have to be pushed through,

knit group that has a hand in almost every important decision the company makes.

Short-term, cyclical, or competitive pressures do not overwhelm an effective strategy at Apple. It cancels, releases, and updates

products at its own speed, seemingly irrespective of market conditions or competitive pressure. The iPod and iPhone, iconic products

both, each began as rumors that Apple seemed determined to quash.

Clone your own Steve jobs - If you put a tyrannical perfectionist in charge, institutionalize his thinking

k, for

example, worked well as acting CEO during the first half of 2009, when Jobs was on sick leave. The most iconic Apple laptop, the

original PowerBook, was released in 1991, after Jobs had been absent for six years.

As per the financial statements of Apple for 2009, 70% of its revenue is contributed by hand-held equipments. Hence further analysis

of the company is based on the smart phones industry.

STRATEGIC GROUP

smart phones have been positioned as premium products with narrow product lines.

KEY SUCCESS FACTORS

As per experts smartphones seems to be a part of a difficult

industry as part of it is fashion & part of it is technology. Based

on this observation Apple has pursued following factors

relentlessly to gain the numerouno position in its respective

strategic group

Technology

Internet driven force It has immensely

helped Apple drive its sales to target

leisure time on internet (2009 NASSCOM

survey). Hence it becomes imperative for

Apple to have a good internet driven sales

force.


Hitesh Gandhi

Priyanka Singhal

PGDM IB (09-11)

Replacing communication

technology Smartphones have

changed the way people

communicate & manage their daily

offer a lot more value to customers

rather than just being a

communication device

Next Generation experience -Although 3G is newest kid on the

technology block but the talks of 4G

are already on. Hence its all about

embracing new technology &

innovating with evolving technology

& consumer needs.

Marketing

Brand name Apple is a well-

known& respected brand in the

market. It has trust of its loyal

customer base which has been built

over years.

Market segmentation Apple marketing philosophy takes its roots from proper market segmentation. It is based

on this market segmentation only that they have a very narrow product line positioned in premium category.

Skill & Capability

Value Addition test ability is to add value to customer in a faster, more convenient & less expensive

ways then the available options.

Design & Innovation Expertise This capability of Apple lets them innovate at a regular basis and present &

design those innovations in a package which adds value to customer at an affordable price.

Distribution

Strong Network Apple has a vast network of wholesalers, distributors & dealers. They have deep reach in the

market which enables them to make their innovations available to markets in a short span of time.

Fast introduction & application of services The vast distribution network, working with internet as its

backbone, helps apple to even put its services faster in the market than the competitors.

STRATEGIC RECOMMENDATIONS

To encounter certain threats like entry of corporate giants like Google, increasing competition and bargaining power of buyers,

following are some strategic recommendations for Apple.

Diversification: To explore new markets and focus more on developing markets like India and China.

Innovation: Apple should focus on innovation of national products; products adapted to the needs of developing nations.

Expansion: Apple should look at opportunities for mergers and acquisitions across the globe to enhance their distribution and

manufacturing capabilities.

�

��

��

Global AUTOMOBILE INDUSTRY

Sector in Focus

Current Global Scenario

�� !��

�!��!� ��" �"�� "�� !�� !��

��!��!�� "� ��#��$� ��%��

!�� "�!�� "��

��"��!��&��!�� !��!��!��

��"��'()�*+��#�� ,��!��"��

��-� �� $� .�"�� &��!�� /�� !%� ��

��"��"��!��!��!�� !��

!��#� ��!�� !�� #�� #��##�!��

!��!��%��$�

�� !�� !�� !��

!��#� ��!�� !�� !%��

��"�� "�� 0��*�� (��

'0* (+�� !��"�� !��#��

�� %��1� �� #� �� !�$�

��##�� !��!��

�� &��#��!��,�

��!��#��!��!%��#��

��!��#��##�!��!�� !��$��

�

�

�

�

�

�

��2��%��"��

��%��"��!��

�� !�� #��$� � �� )��

"��!�� !� ��

�� &��!�� !�� 3� ��!��$�

��!�� 4�� %�� #� �5�

��!�� &� ��%�� !�� %��

�&��!�� "� �� !�� #� ,� ��!��$� ��

��%��"��%��"��#��

�� #�� #� ��!��

�� !�� "�� %�� !�� 6�� $�

��%�"�� )�� '�7+� �� 8�� !��

��!��"��$�

��

��

��

��

��

��

(��

9��

2�&�!��

:��)��!��

��

��)��!�� !��

��

7��;�� ! ��

;��;�� !��

��

(��

� ��

)��

�

�� !� � �� 3� �� !�� "�

��!�� !�� #� �� <� ��!�� #� ��

��$��!��#��,��!��#��

��"��!�� !�� 6��!�� !��

�� "�� "�� 7� �� $� =7��

�� #� >�� 3�8� �� %�"��

��%�� !��!� ��

�� 3�?��7�� @��

��$��

�

�� !�� #� �� !�� "�� ##�

�� A�$�� #� �� !�� $� �� !�� ##�!��

��"��<��!�� !��#� �� #� ��

"��28��!�� ,��!�� $�

6�� !��"��#��

��"�� $��

�

��2��%��6��

�� !�� !�� !�� 462��

��BC�� #��5�!��!��

�

India has emerged as an outsourcing hub

for auto parts for international

companies such as Ford, General Motors,

Daimler Chrysler, Fiat, Volkswagen and

Toyota

�

��

)��!��)��6�!�#�!��;��)#��!�� 2� ��;�

��$�� !�� (;D��6��

(��E��;&�!��0��9��.�� @��!��

�##�� !�� "��

�� #�� !�� !��

�� !�� )��6�!�#�!��!��#��$

�$ (�� )��!�� !� �� !��!�

�!��"��

�$ �� "��"��%��;2;)�!��

F$ 0�� !��;��;�� )�

��"��

:G )�E��*�� )��

� �� #��%��%��#��

��!��!�� &��!��

�� !�� #��$� � ��

�� !�� #�� #��

!��!��@�� 2��G��(��

��%�"�� $�G�� 3��B��

�� &�� #�� !�� "�� !�� 9�A�

�,$3,�0�� 9�A�F$��0��!��$�

�� %��"��#��

��!!�� #��@��!�$�

��#��%��"�� #�� C

• *��

• *��!��!��

• *�� !��

• 9��

• *��G��!��

• ;��#��!��!��

• *�� "�� !�� !��

��

��

)��!��)��6�!�#�!��;��)#��!�� 2� ��;��%��

��$�� !�� (;D��6�� (��

��;&�!��0��9��.�� @��!�� #�

�� $�

�� #�� !�� !��

�� !�� )��6�!�#�!��!��#��$�

�

(�� )��!�� !� �� !��!�

;2;)�!��

0�� !��;��;�� )��

� �� #��%��%��#��

��!��!�� &��!�� #�!��

�� !�� #��$� � ��

�� !�� #�� #��

!��!��@�� 2��G��(��@��

�B��

�� "�� !�� 9�A�

�� %��"��#��!��

��!!�� #��@��!�$�

�� C�

�� #�!��

��!��

�� &��!�� "� ��9�A� 5�� 0��

�� <� �� &��!�� !��

��8��G6$� ��!!��#�� !��#��:�� !��

!�� "�� !��

�� !�� $� �� !��

� ��)�� $�

�

�

�

�

�

��#��!�1�� !��"��

�� 6��

�� #��;��!��

�� #�� #�� &�� #� ;��

��$�)��!�#��!�

�� %� "��%�� "�� "��!�� %��

�&�� !�� %�� (�� )��!��

%�� #�� %�$� ��B��6�� #� ��-� !�� ;��

9�� !�� "��$�)��

�� "��!$� ��

�� !�� &��!�

!��I�� "�� %�� #��

� ��$� 0�� #�� #� ��

��J��!%�J��!��#��

��!��%�� $��"��%�� "�� $

�

2� ��!��"��#��#��

��!��#��

�� !��!��$��

#��!��#� ��!��#��%��C�"��

��,H� �� #�!�� #� �F$<H� �� B�� "��

!��$�D�� !��"��!��

�� %� � �� K�

6�� "��!��#��

�� #��"��

��#��%��&��C�0��1��

��#��;9��

�� "��#��$�

;��;!�� !�"# $��

% ##��

� ��

�� #�!��

��!�� $��

�� &��!�� "� ��9�A� 5�� 0�� ,$� 0��

�� <� �� &��!�� !�� H� �#� ��

G6$� ��!!��#�� !��#��:�� !��

!�� "�� !��

�� !�� $� �� !�� #� ��

� ��)�� $��

��/��&��

2��G$��

6�G2� 0�'�B��+�

�

��!�1�� !��"�� "��

�� 6�� $� �� !��

�� #��;��!�� #��

�� #�� #�� &�� #� ;��1�� %��

��$�)��!�#��!��!�� %��

�� %� "��%�� "�� "��!�� %�� #�� ##�!�� #��

�&�� !�� %�� (�� )��!�� #� �� ##��

��B��6�� #� ��-� !�� ;��

9�� !�� "��$�)��!��"�

�� "��!$� ��!��

�� !�� &��!�� #� ��

�� "�� %�� #��

� ��$� 0�� #�� #� ��%��

��J��!%�J��!��#��

��"��%�� "�� $�

2� ��!��"��#��#��!��$�

��!��#��#� ��

�� !��!��$��&��"��!��"��

#��!��#� ��!��#��%��C�"��!� ��G6��#�

��,H� �� #�!�� #� �F$<H� �� B�� "�� 1��

!��$�D�� !��"��!�� !�1�� #��$� ��

�� %� � �� K�

6�� "��!��#��#��&��

�� #��"�� #��!� $��

�&��C�0��1��

��#��;9��#��!��

)��%��2� �%�

6�G2� 0�'�B��+�

�

;��;!�� !�"# $��

% ##��

e - GlobuzZ, Volume I, Issue III July September 2010 Page | 6

COVER STORY A tribute to Late Prof. C. K. Prahalad

Bottom of the

PyramidHow Sustainable is your Business?

Did we know that a company could make a bigger

profit by focusing on the market segment consisting

of people who earn less than $2 per day?

growing market is at the bottom and not the top of

the fortune pyramid?

Were we aware that nine countries including China,

India, Brazil, Mexico, Russia, Indonesia, Turkey,

South Africa, and Thailand collectively have a GDP

of $12.5 trillion, larger than the GDP of Japan,

Germany, France, Italy, and the UK combined?

C.K.

Prahalad

know-how, and investment capacity, we are unable

to make even a minor contribution to the problem of

This profound question stares at you only to leave

you answerless. In 2002, The Fortune at the Bottom

of the Pyramid ushered in a new level of

consciousness in international business strategy.

Although the idea of doing good and doing well was

already well established, the anecdotal case by C.K.

Prahalad and Stuart Hart that the four billion people

each living on less than US$2 a day (the bottom of

held the

potential for immense profit captured popular

imagination. Multi-national companies (MNEs)

around the world launched initiatives to adapt and

poor.

The real fortune being sought is the simultaneous

accomplishment of a trifecta of goals corporate

profit, relevant and sustainable social impact and

local poverty alleviation. The impending questions

are:

I. Securing Internal Support: How can companies

gather data affordably in order to make a

compelling business case and develop accurate

projections?

II. Testing on a Budget: How can we run pilot

programs at an affordable cost with low-margin

business models?

III. Patience: How can we balance corporate

pressures for profitability with commitments for

impact in the community?

IV. The challenge of growth: How can we scale while

adapting the product composition and its delivery

mechanisms to the needs of each local community?

The assumption that the poor need to seen as a

market, but one different from the conventional

perception ofa market, has some immediate

Financially sustainable and integrated

BOP business lines are the pinnacle of

truly sustainable and strategic

Corporate Social Responsibility


consequences all of the traditional business

concepts are applicable but each and every one of

those concepts needs to be applied from a distinct

perspective.

What results is a practical example of the

applicationof innovative thinking and innovation to

an intractable problem How to cater to the more

than 4-billion humans who do not form part of the

target market of the organizations that are driven by

conventional assumptions about products, services,

value and needs.

Professor Prahalad demonstrated that the process of

poor can provide substantial returns to create real

partnerships and innovations for established

companies.

Thus Top of the Pyramid Approach may just lead to

Sustainability BUT Bottom of the Pyramid leads to

Sustainable Development

What is required is to undertake an analysis of the

current BOP paradigm to support the development

of a sustainable, participatory multi-stakeholder

approach.

-nationals towards SME

development

COVER STORY A tribute to Late Prof. C. K. Prahalad

participatory, bottom-up initiative

To a great extent, financially sustainable and

integrated BOP business lines are the pinnacle of

truly sustainable and strategic Corporate Social

Responsibility. Answering the questions at the

bottom of the pyramid may be the key to ushering in

a new era of capitalism which generates profit,

offers wealth-creation opportunities for the poor,

spreads products to reduce sickness and spreads

education around the world welcoming billions of

people to participate in a more inclusive, sustainable

global economy. The thousands of little fires lit by

corporations, entrepreneurs, academics,

governments and non-profits may yet become a

blaze that will change the world.

Vikash Singh

PGDM IB (09-11)

Workplace Wellness established its foothold in the West long back. The trend is now finally catching up in India. With the rapid growth of the IT and ITeS sectors,

the rest of the industries.

A 2009 study conducted by Right Management, a Manpower Company, suggests that wellness is an extremely powerful element that can play a significant role in

employee engagement, organizational productivity, talent retention, and creativity and innovation. It is imperative that wellness should be incorporated in the

organizational effectiveness framework to realize real business gains.

it is important to note that an

organization can position Wellness very effectively as an int

its influence going well beyond the boundaries of just physical and psychological health will translate into better organizational effectiveness. Wellness needs to be

looked at as an umbrella of various initiatives and offerings.

Redefining wellness as a concept that offers more than just health to the employees is the way forward for all the organizations.

The Wellness Wave: International HRMDhara Shah (MMS- HR 09-11)


COUNTRY IN FOCUS

SOUTH AFRICA

The Republic of South Africa is a country located at the

southern tip of Africa, with a 2,798 kilometers coastlineon

the Atlantic and Indian Ocean. The official currency is Rand.

The country is divided into nine provinces with the four main

regions of commerce being in the Western Cape (Cape Town),

Eastern Cape (Port Elizabeth and East London), KwaZulu-Natal

(Durban) and Gauteng (Johannesburg).

Industries

South Africa is rich in mineral resources, has a well-developed

minerals. It has a broad-based industrial manufacturing centre,

making it the largest and most industrially developed economy

in

trading nations. Agriculture is an important component of the

economy and the country is a net exporter of food.

Investing Climate

The South African economy is predominantly based on free

market principles, with some areas of state control. There is a

long history of foreign investment in South Africa, with heavy

involvement by British, German and American interests. As the

leading economy in Africa, with a well-developed

infrastructure and established trade links with the rest of the

continent, South Africa is a suitable base for generating

investment and trade with the rest of Africa, particularly in the

sub-Saharan region. Except in the banking, insurance and

broadcasting industries, there are no restrictions on foreign

ownership of local companies and businesses.

There are initiatives in place for the empowerment of black

persons (i.e. Black, Colored and Indian persons). These include

increasing ownership of companies by black persons and other

forms of empowerment through employment equity and

preferential procurement.

Economy

The country has an excellent physical infrastructure in terms of

roadways, railways, power distribution etc. South African

industry is able to produce most of the requirements of

Southern Africa. The market is, however, small in comparison

to European and US standards and in many instances a single

enterprise is capable of satisfying the entire needs of the

country with its products.

Political System

African National Congress, with Mr. Nelson Mandela as

president, was elected with an overwhelming majority. The

South African government comprises as the national,

provincial and local spheres of government which are

distinctive, inter-dependent and inter-related. The legislative

authorities, executive authorities and judicial authorities are

all separate from one another.

Social Issues

The education system and teaching methodology are not yet

modern. The number of graduates is quite less. There is a

critical shortage of low cost housing. Crime rates are high

though the government has implemented National Crime

Prevention Strategy. HIV/AIDS is one of the greatest

challenges for both the Government and the businesses.

IPR

South Africa has tight Intellectual Property laws though the

enforcement is not stringent. The review of South Africa's IPR

regime reveals a rather mixed picture of the state of IPR

protection in South Africa. The approval of South African

Reserve Bank is necessary for the export of any

technology/intellectual property. In South Africa, the

intellectual property division of CIPRO, the Companies and

Intellectual Property Registration Office, is responsible for the

registration of patents, trademarks, designs and copyright.

With a well-developed

infrastructure and established

trade links with the rest of the

continent, South Africa is a

suitable base for generating

investment and trade with the

rest of Africa, particularly in the

sub-Saharan region.


Foreign relationships

One of the leading voices in the African continent, South Africa

has been involved in a series of initiatives at both political and

economic level to promote and advance African interests and

peace in Africa. South Africa is a founder member of the New

Par a

member of several international organizations such as United

Nations, the Commonwealth and the Non-Aligned Movement

and has established diplomatic relations with over 150

nations. In recent years, South Africa has also developed

strong relations with markets in the rest of Africa, Asia and

Latin America. South Africa is also part of IBSA, a trilateral

developmental initiative between India, Brazil and South

Africa, to promote South-South cooperation and exchange.

Culture

South Africa is a mix of different cultures representing every

level of an extremely stratified community. Apart from the

Afrikaners, most of the white South Africans are of British

descent. But most of the traits of a heterogeneous culture

were ignored, destroyed or trivialized during the years of the

apartheid. In a society where a person could be imprisoned for

just owning a politically incorrect piece of art like a painting, all

the serious works of art were forced underground and the

galleries and theaters were filled with bland works of art.

South Africans have been referred to as the 'rainbow nation', a

title which epitomizes the country's cultural diversity. The

population of South Africa is one of the most complex and

diverse in the world. Of the 45 million South Africans, nearly

31 million are black, 5 million white, 3 million colored and one

million Indian. The population density is 32.9 people per km.

Conclusion

As an investment destination, South Africa has enormous

potential due to the unique mix of highly developed first class

economic infrastructure with a vibrant emerging market

economy. It is also one of the most advanced and productive

economies in Africa. After adopting democracy in 1994, South

Africa has been undergoing rapid structural transformation

with the implementation of macro-economic policies aimed at

promoting domestic competitiveness, growth and

employment and increasing the economy's outward

orientation. Not only is South Africa in itself an important

emerging market, it is also a key for accessing other sub-

Saharan markets. Key economic reforms have given rise to a

high level of macro-economic stability.

The government has made it clear that foreign investment is

welcome in South Africa, and investor-friendly policies support

the public pronouncements. SouthAfrica has a world-

class,progressive legal framework. Other factors like

unemployment, weak health care sector etc. notwithstanding,

South Africa appears to offer a lot to potential investors and

business ventures.

Parvathi Ramanandan

Aditi Gupta

PGDM IB (09-11)

MAP : South Africa


Academic Fraud in China

the need to foster innovation. He makes a strong case:

sustaining economic growth and competitiveness requires

China to go beyond mere labour-driven manufacturing and

into the knowledge-based business of discoveries, inventions

and other advances.

well-earned reputation for pervasive academic and scientific

misconduct. Scholars, both Chinese and western, say that

fraud remains rampant and misconduct ranges from falsified

data to fibs about degrees, cheating on tests and extensive

plagiarism.

The most notable recent case centres on Tang Jun, a

celebrity executive, a self-made man and author of a popular

book, My Success Can Be Replicated . He was recently

accused of falsely claiming that he had a doctorate from the

prestigious California Institute of Technology. He responded

that his publisher had erred and in fact his degree is from

another, much less swanky, California school.

Other cases involve accusations of plagiarism against well-

known Chinese scholars which have provoked the

authorities to talk of investigating. A western scholar

recounts how a social-science project was jeopardized

recently when data collection was contracted out to a

Chinese company whose researchers simply filled out the

survey forms themselves.

Such lapses of integrity are not unique to China, but poor

peer-review mechanisms, misguided incentives and a lack of

checks on academic behaviour all allow fraud to be more

common. China may be susceptible, suggests Dr Cong Cao, a

specialist of Chinese Sociology at the State University of New

York, because academics expect to advance according to the

number, not the quality, of their published works.

Thus reward can come without academic rigour and senior

scientists, who are rarely punished for fraud, set a wrong

example for juniors.

The implications of widespread academic misconduct could

be great. Denis Fred Simon of Penn State University argues

overall credibility of the entire scientific enterprise in China-

and unfortunately feeds negatively into the related concerns

about the safety of Chinese products and the integrity of

In practical terms foreign scientists may be deterred from

China, as they worry about getting caught up in scandals.

Early this year, after it was found that 70 papers on crystal

structures submitted to an international journal by Chinese

scientists had been fabricated, the Lancet medical journal

suggested, had failed to get to the root of why some Chinese

scientists lie.

Another direct cost may be felt by Chinese students looking

for college places abroad. Admissions officials are suspicious

of near-perfect scores on standardised tests and glowing

recommendations from professors, which are common to

many applications from China. The risk is that genuinely

qualified students are turned away because of general

integration with the outside world may help. As more

academicians earn degrees abroad and go back to posts in

China, informal networks are created that help outsiders

check on the quality of applicants. That is a small innovation,

but perhaps one that will benefit China.

Abhishek Modak

PGDM IB (09-11)


Report on Economic Freedom Network Asia Conference 2009

Siam Reap, Cambodia

In 2009, I bagged an opportunity to present a view from

India in the historical city of Siam Reap in Cambodia to a

distinguished and diverse gathering. The conference

discussed the ongoing financial and economic crisis and ways

to tackle it. The theme unearthed many more sub-themes

when considered through the pris

conference, economists, corporate professionals,

policymakers, lawyers, newsmakers, grassroots-workers,

philosophers, thinkers, educationists reflected and expressed

their views on the latest global debacle. The congregation of

130 academicians and practitioners from 18 countries

enriched the conversations on the broad theme.

Cambodia as a Setting for the Conference:

SEN, Deputy Prime Minister and Minister of Economy and

Finance (representing H.E Somdech Akka Moha Sena padei

Techo HUN SEN,Prime Minister of the Kingdom of Cambodia).

H.E. Chhon stated in his opening address that "In a broad and

global term, the Rule of Law is threatened worldwide from

four directions: (i) by the lumpen proletariat for their

ignorance, despair and poverty, (ii) by the lumpen aristocracy

for their arrogance and their insatiable greed as revealed by

the cataclysmic crisis of international finance, (iii) by the

deadly terrorism fuelled by ideological extremism and (iv) by

the organized crimes.

Cambodia was aptly chosen as the host

country representing the case of a conflict-

ravaged nation trying to get on the way to

economic recovery amidst the backdrop of

the economic shake-out in the western,

develope

economy grew at an average of 11.1

percent during 2004-2007, after its

accession to WTO in 2004)

The Rule of Law relates to the economy

through its power to protect property

rights, enforce contracts, ensure fair

competition, and mobilize and disburse

financial capital."

Key Points of Discussion:

transparent system) is preferred as

opposed which is

Conference took place in the once- glorious city of the Angkor

Wat (the famous temple complex built by King Suryavarman II

in 12th

century, which still is magnificent as a ruin).

Overall Experience of the Conference: The two-day

conference featured keynote addresses from internationally

renowned experts, as well as a series of themed panel

streams, presentations and exhibitions. The conference

up with their own agenda thanks to the Open Space

Technology.

Proceedings in Brief

The Conference was officially opened by H.E. Keat Chhon,

arbitrary, opaque and mainly for political ends).

part and parcel of progress especially in a capitalist

economies. Therefore instead of lamenting the

recessionary phase, the focal points should be on

finding ways of cushioning the impact of the

recession.

Free Market Economy may not be the perfect market

structure but is the best alternative

An inward-looking response to the economic crisis

will delay recovery and can deepen recession.

Thanks to globalization, the recovery signs have

appeared quickly, as compared to earlier crises


crisis?"

Causes of the Financial and Economic Crisis: Though the sub-

prime crisis initiated the domino effect, there were other

factors that contributed to the spread of the crisis. As

discussed in the conference a few of them are enumerated

below:

Central bank interventions

Too much regulation or too much freedom?

Nature of rules and regulations: Community

Reinvestment Act, Basel II

Misleading statistics and ineffective risk assessment

tools

Irresponsible credit rating agencies

Savvy Financial marketers who created fancy financial

products

Poor corporate governance

Ad-hoc bailouts

Undervaluation of currencies in Asia

Proposed Solutions:

1) Immediate Measures:

Curtail deficit spending

Reduce the role of politics in policy formation

2) Medium Term Measures:

International understanding/cooperation towards

reducing barriers

Define the Lender of Last Resort function of the central

bank

Risk-based Pricing of Deposit Insurance Premium

3) Long- Term Measure:

Moving towards Decentralization of Money and Free

Banking System

Yavnika Khanna

PGDM Marketing (09-11)

CR

OS

S W

OR

D S

OLU

TIO

N #

02

different sports. Sports act as a common platform to bring together people from different walks of life.

Marketers wait impatiently for opportunities

events. Such strategies or sports events for promotion of brands have been used since time immemorial.

Recently the Football World Cup was held at South Africa. Hoards of brands promoted their product and some

even launched products during FIFA. Coca Cola has a formal association with FIFA since 1974 and an official

sponsorship of FIFA World Cup that began in 1978. Coca-Cola has had stadium advertising at every FIFA

World Cup since 1950. Five additional sponsors for FIFA 2010 were Budweiser, Castrol, MTN, McDonalds and

Continental. Each of these deals have cost them more than $ 100 million only for the event. Mahindra Satyam

was designed the official IT partner at FIFA.

But Coca Cola went a step ahead and came up with several promotional activities tailor made for FIFA. It has

formal association with FIFA since 1974 and an official sponsorship of FIFA World Cup that began in 1978.

The FIFA World Cup Trophy Tour by Coca-Cola

had embarked on its biggest ever global tour

to 86 countries including every nation in Africa as part of the FIFA World Cup Trophy Tour by Coca-Cola. Free

tickets to the Trophy Tour were made available to consumers via Coca-Cola promotions in countries on the

route.

At events in each city, fans had souvenir photos taken of them with the trophy, viewed a 3-D movie showcasing

moments of the FIFA World Cup, participated in interactive displays and enjoyed other entertainment. This tour

save fans around the globe a chance to experience the excitement and pageantry of football no matter where

they lived. So this made the consumer feel that Coca Cola brings happiness to their doorstep, against all odds.

Coca Cola recorded the Coca Cola 2010 FIFA World C Flag Coca-

with Somalian hip- . This track was the music element throughout the FIFA World cup

campaign. It was featured in all TV commercials, played during promoted

online and more.

CCooccaa CCoollaa SSccoorreess aa WW iinnnneerrINTERNATIONAL MARKETING

From September 2009 to

greatest prize was embarked

on its biggest ever global

tour in 86 countries including

every nation in Africa as part

of the FIFA World Cup

Advertising

Coca-Cola created three commercials as part of the campaign the

story of how Roger Milla inspired footballers to celebrate goals in an African- an

way around the globe.

Commemorative Packaging

Coca Cola also came up with special packaging that celebrated the 2010 FIFA World Cup with dynamic

graphics and football imagery.

Coca-Cola Football Camp

250 teenagers from around the world gathered at a special football camp hosted by Coca-Cola in Pretoria, South

Africa during the FIFA World Cup tournament. The camp encouraged young people to remain active through

sports and also included training, skills demonstrations, celebrity coaches and a tournament.

Coca-Cola Flag bearers

Coca-Cola also gave young football fans around the world the once-in-a-lifetime opportunity to be official flag

bearers and lead the teams out on to the pitch before 2010 FIFA World Cup games.

Conclusion

Coca-cola, by showing the world how to celebrate the World Cup, has also showed the management gurus and

other companies how to market a brand by riding on the glory of a much loved event. It made a mark and was

the defining brand of this World Cup, even though other brands like Pepsi tried to ambush its position. The

multi frontal, multi platform and multimedia based approach of Coca-C marketing campaign ensured that

the audiences around the world over were left with the memory of celebrating the world cup with little drops of

joy.Shilpi Tayal

Celia Madona Vincent

PGDM IB (09-11)

Coca-Cola Celebration Award

Coca Cola interactive marketing strategies

included the recognizing of

goal. This grabbed attention of the fans as for the

first time ever they got a chance to vote for the

eventual winner online.

Coca Cola also came up with a CSR activity. For

every goal scored and celebrated with a dance it

made an additional donation to th

Water for School effort that helps provides

schools access to safe drinking water.

-

Coca-Cola produced a 60-minute documentary which unfolds

catches up with 2010 FIFA World Cup players as they plan their

Africa inspired celebrations for the tournament.


Global Banking Scenario

INTERNATIONAL FINANCE

Introduction

A bank is a financial intermediary that accepts deposits and

channels those deposits into lending activities, either directly or

through capital markets. A bank connects customers with

capital deficits to customers with capital surpluses. Banking is

generally a highly regulated industry, and government

restrictions on financial activities by banks have varied over

time and location. The current set of global bank capital

standards is called Basel II. In some countries such as Germany,

banks have historically owned major stakes in industrial

corporations while in other countries such as the United

States banks are prohibited from owning non-financial

companies. In Japan, banks are usually the nexus of a cross-

share holding entity known as The Keiretsu. The oldest bank

still in existence is Monte dei Paschi di Siena, headquartered

in Siena, Italy, which has been operating continuously since

1472.

Size of Global Banking Industry

Assets of the largest 1,000 banks in the world grew by 6.8% in

the 2008/2009 financial year to a record $96.4 trillion while

profits declined by 85% to $115bn. Growth in assets in adverse

market conditions was largely a result of recapitalization. EU

banks held the largest share of the total, 56% in 2008/2009,

down from 61% in the previous year. Asian banks' share

increased from 12% to 14% during the year, while the share of

US banks increased from 11% to 13%. Fee revenue generated

by global investment banking totaled $66.3bn in 2009, up 12%

on the previous year.

The United States has the most banks in the world in terms of

institutions (7,085 at the end of 2008) and their branches

(82,000). As of Nov 2009, China's top 4 banks have in excess of

67,000 branches (ICBC: 18000+, BOC: 12000+, CCB:

13000+, ABC: 24000+) with an additional 140 smaller banks

with an undetermined number of branches. Japan had 129

banks and 12,000 branches. In 2004, Germany, France, and Italy

each had more than 30,000 branches more than double of the

15,000 branches in the UK.

What is Banking today?

The current banking scenario is greatly different from the past.

Only 15 to 20 years ago, most Western banks generated 90% of

revenue from interest income. Now this percentage has fallen

to 60%, sometimes as low as 40%. The concept of banking is

being modified and the traditional barriers among financial

service sub industries (retail banking, private banking,

investment banking, asset management, insurance, etc.) are

vanished.

Global Banking

The common trends resulted in pace of dramatic change for

banking are:

The focus of banking is shifting from transaction

management towards sales of financial products.

Barriers to entry for the retail banking segment are

being lowered.

The growing variety of delivery channels for banking

enables new entrants to thrive.

Factors affecting Global Banking Scenario

The technological breakthrough caused by the

eruption of e-banking and e-finance.

Worldwide consolidation and consequent

restructuring.

Increasing competition in terms of both markets and

products.

Despite the improvement

to banks' balance sheets,

several factors raise

doubts about the

sustainability of banks


INTERNATIONAL FINANCE

A slowing population growth and increasing average

life expectancy and per capita income.

The growing importance of a clear strategic intent in

the banking industry.

New competitors are entering the financial service

business.

Consolidation : Consolidations take place for the

following reasons:

o To take advantage of economies of scale.

e.g.:-the merger between the Swiss banks UBS

and SBC creating one of the largest banks in

the

o To have access to distribution channels.

o To widen the range of products that the bank

can offer both actual and potential clients.

e.g.:-between Citibank and Travelers, has

originated Citigroup

Highlights of Global Crisis

In October 2007 major failures start to appear in the

bank has announced losses $3.4bn from investments

linked to sub-prime.

Following, American banking giant Citigroup posted a

sub-prime loss of $40bn.

US investment bank Merrill Lynch revealed a $7.9bn

disclosure to bad debt.

After failing to search for a potential buyer, Lehman

Brothers becoming the first major US investment bank

to collapse since beginning of the credit crisis.

Aftermath of Global Crisis

IMF warns that world economy development could

decline to its lowest point ever since World War II to

just 0.5% this year.

In USA the interest rate has been cut hugely by the

Federal Reserve from the 5.25% to 0.25%.

In UK pound was at a 23-year low against the dollar.

The Bank of England has cut interest rates to a record

low of 1% -the lowest level in its 315-year history

The US Congress passed a stimulus package worth $

838 billion, aimed at creating millions

of new jobs and steering the economy out of the

recession.

China announced a huge economic stimulus package of

an estimated $586 billion.

Japan announced $100bn to curb recession.

Germany announced $63bn

Conclusion

"Despite the improvement to banks' balance sheets, several

factors raise doubts about the sustainability of bank profits,"

the BIS (The Bank for International Settlements) said. Banks like

UBS (UBSN.VX), Morgan Stanley (MS.N) and Goldman Sachs

(GS.N) posted strong earnings in the first three months of this

year thanks to trading income. A number of countries had to

bail out banks at the height of the crisis to prevent the financial

system from collapsing.

Also not all crisis-related losses may be exposed yet as less

stringent and less timely reporting requirements for banks in

Europe had made it more difficult to gauge future write downs.

More write downs could be expected due to falling commercial

property prices, it said.

"Losses on European bank balance sheets are expected to

mount over the next few years," the BIS said. "Anecdotal

evidence suggests that some banks have taken to rolling over

existing loans rather than inducing foreclosures, thus delaying

loss recognition." The BIS also said that many banks in Europe

and elsewhere were overly reliant on US dollar swaps.

European and other banks had an estimated $7 trillion in

dollar-denominated assets on their books, much of them with

long-dated maturities.

So, the world's banks are still not out of the woods despite

recent multi-billion profits as write downs on loans loom and

funding pressures remain high.

Shalu Goyal

PGDM IB (09-11)


Q&AExcerpts of talk of

Mr. RohitPandya- Dy. General Manager-

Buyer & Country Underwriting,ECGC,

Mumbai with Sukhmani and Vikash of

PGDM IB (09-11)

Mr. Rohit Pandya joined ECGC in 1982 in the Risk

Management Division and then moved to the role of deputy

General Manager - Buyer & Country Underwriting and is

continuing in the position since then. He has over 28 years of

experience in the field and has been involved in numerous

International assignments.

Q. Tell us something about your background and the career path

over these years.

A. As far as my academic background is concerned, I did my

Hons. in Economics and then a Post-Graduation in Sociology. I

also completed my Masters in Business Management from

Bombay University and then went on to complete my diploma in

Foreign Trade from IIFT.

My professional career started when I joined ECGC in 1982 in

the Risk Management Division as well performed other

functions in the Corporation and then I moved recently to the

role of Deputy General Manager Buyer & Country

Underwriting and am continuing in this division since then.

Q. You have been associated with ECGC for past 28 years. What

changes have you seen in the International Trade environment

over your tenure?

A. There has been significant change in the International trade

environment especially in the last few years. Earlier there was

precious demand for Credit insurance and very little awareness

about the same. The trend has changed in terms of increased

awareness and demand for credit insurance because of transition

of Indian exports from traditional markets to non-traditional

markets and traditional commodities giving way to new

commodities .Also there has been an addition of a large number

of new buyers. On the country level perspective, in the last few

years the the

large and well-known companies going bust in developed

markets. Underwriting process has also undergone a change in

this view. About six years ago a more liberalized approach was

introduced, because the Corporation was showing operating

surplus in its schemes. The premiums rates were last revised in

2003 but the classification have been constantly revised and have

taken a totally new dimension post meltdown era.

In the Global credit insurance market in advanced countries the

Short Term businesses are now on a decline and movement to

medium/long term projects has happened In India a similar

prospect is visualised as the economy matures.

Q. How do you evaluate the risk for Credit Insurance Products

provided by ECGC?

A. We, at ECGC, follows a system of risk assessment wherein 3

dimensions or perspectives are analysed:

a. Indian Exporters-

IECD Code, membership of promotion Council, holding bank

account, pan card and assessment of capability of exporter to

execute the order or sustain himself in the International arena.

b. Overseas Buyers- in terms of financial & Non-Financial

factors. Reports from 13 agencies to get credit information on

the buyers are accessed. In addition ECGC Experience with the

buy

account.

c. Country - in terms of Objective Score Methodology with 7 fold

classification as A1, A2, B1, B2, C, D countries the political risks

associated with a country is assessed.

Q. What competitive advantage does ECGC have over its

competitors viz a viz private insurance players in the market?

A. ECGC has a unique competitive advantage of being a

Government supported ECA which expands its role and scope. It

has a record of over three lakh buyers to depend upon while

underwriting the buyer risks. The area of Indemnifying bank,

which comprises of 2/3rd

Support are the areas which have been introduced by ECGC and

not by any other global or Indian player and similar models are

now being replicated abroad. It has a strong hold in the credit

insurance business which affirms its position as the major body

in Export insurance sector.

Q. In case of European countries like Portugal, Italy, Greece

and Spain that are on the brink of sovereign defaults, some

private sector general insurers like ICICI Lombard General

Insurance Company Ltd and Bajaj Allianz General Insurance

Company Ltd. have begun tightening risk premiums to these

A.

Instead we deal with such cases by putting a restriction on the

buyers in such countries. For example, in UAE we have

discontinued Single Buyer covers and only offer Umbrella Cover


SCJFHDKJFDFDF

Strategy is the key to

integrate all the

techniques you learn in

management. A Three-

fold dimension of Focus,

Knowledge base and

Skills development is

required for competitive

advantage to be gained

through MBA in IB.

A. There is vast potential in such tools which are a result of the

collaborative effort between the two institutions. There has been

increasing role of ECGC in the International Trade environment

and that has led to great synchronization with other

organizations like EXIM bank particularly in areas of Line of

Q. ECGC Provides Overseas Investment Insurance to Indian

companies investing in joint ventures abroad in the form of

equity or loan. Are there any specific sectors which are covered

under this scheme?

A. ECGC Overseas Investment Insurance provides cover to all

the sectors and has an equal focus on all of them. The major risk

covers include Expropriation Risk & War Risk, Transfer Delay

risk etc.

Q. What major challenges has ECGC been facing in the

International trade environment lately?

A. Some of the challenges have been related to the high claim

insurance in the last couple of years; heavy loss in markets like

US, UK, UAE, Italy & Germany; losses in commodities like

Gems & Jewellery etc. The global meltdown and the

consequences of squeeze in credit lines and pile up in inventories

has affected the credit insurance requests sought which has

increased both in size and frequency. There is a noticeable

increase apart from delinquencies, requests for rescheduling and

elongated terms of payment.

Q. What leverage, in your opinion, does a course specializing in

International Business provide & what competencies should a

student of International business develop to be Industry ready in

the International Business environment?

A. I would term a management course in international Business

as an MBA PLUS. Strategy is the key to integrate all the

techniques you learn in management. Implementation is

achieved through a thorough understanding of the International

strategy that should be put in place for the company to succeed

in the global market. As for the competencies, having a three-

fold dimension is required: a Global Focus on the International

Scenari

the borders of the country, Skill adaptability & flexibility are the

most sought after competency areas. These should be well

coupled with having an international outlook, developing the

ability to assimilate different cultures, developing negotiation

skills & lingua franca will ensure that the student is well

equipped to add value to the becoming a major player in

International business.

products to have a good spread of the risk. Also if the situation so

warrants we re-classify a country which directly or indirectly has

an impact on the premium rates.

Q. ECGC has reclassified the credit-worthiness of 237 countries

in April 2010 by reviewing all the countries using its CRRM

model which includes forecasting as a parameter. Could you

please give some insight on the measures?

A. ECGC has a regular process of reviewing its rating

methodology. For example, Cuba lately has been revised for its

ranking and is now upgraded in the ratings after initiatives from

Indian government to develop trade relations with Cuba were

declared. ECGC has high level exposures, monitoring and

reviewing systems in place and is constantly keeping pace with

the changing environment.

Similarly, ECGC is quite bullish on Iran but as of now has

restricted exposures to Iraq.

Q. EXIM Bank in association with ECGC has planned new

credit tools (partially structured buyer's credit where exporters

will bear the subsidy) where government or multilateral lines of

credit are not available and ECGC will grant the political risk in

such cases. How much of market value do you see in such tools?

Q&A


DEBATE: WILL EUROPEAN UNION SUSTAIN?The Euro zone has a choice to make, which is, to either integrate or disintegrate. Greater integration has been chosen as

more financially disciplined nations of the European Union bailed out the PIIGS (Portugal, Ireland, Italy, Greece and Spain)

whose excessive spending and serious indebtedness have threatened the stability of the world's number two reserve

currency; the Euro.

The decision to make EU effectively a monitory union, tying its member countries into a joint currency and interest rate

decisions, while allowing them to retain control over national budgets and taxes, has left the fractured grouping at a

crossroads where in the members can either come together and stand by each other to tackle the problems or choose to fall

apart driven by self-interests of the country. So the major question arises whether the EU will sustain as a union or

disintegrate.

Inspite of the dark cloud surrounding the European Union

and the world over; inspite of so many articles being

written about European Union and predictions of torrid

times ahead; there is still lot of hope about its

sustainability in the future.

The Greek and the economic crisis have done no good to

it. Nearly $1 trillion bailout package was declared

from dragging under other weak economies Portugal,

Spain, Ireland and Italy that are all vulnerable. It comes in

the form of loans, debt guarantees, and additional cash to

the money markets. The risk of contagion has already

been mitigated through this bailout package. There are

some reason

Firstly, EU banks have survived the stress test. The tests

have found that 91 banks in 20 European countries could

deteriorating economic and financial environment. But

only 7 banks flunked the tests, coming up short a

Market reactions are muted, likely indicating that neither

the worst fears nor greatest hopes were realized. The euro

seesawed in New York trading, eventually gaining ground

against the dollar. The Dow Jones Industrial Average

dropped shortly after test results were announced around

noon Eastern Daylight Time, but ended the day up 102

points, to 10424.62. U.S.-listed shares of some big

European banks followed the same trajectory.

Bank supervisors throughout Europe hailed the test results

as affirming the stability of the continent's banking

system. Market confidence in Europe's banks has since

improved somewhat, partly due to optimism that a round

of stress testing, which last year helped ease the U.S.

banking crisis, would work similar wonders in Europe.

Despite worries about the health of the French, Irish,

Italian and Portuguese economies and banks, no bank

from any of those countries failed the tests.

2nd largest reserve currency. Failure of EU would mean

fall of Euro which will also endanger the other major

stakeholders around the world who maintain their part

reserve in Euro. These include countries like Russia and

china. Hence there would be a huge pressure from around

the world for EU to remain integrated. Even if the need

arises IMF would step in to rescue.

What we are talking about here is one fifth of the World

be ignored by rest of the

world. Disintegration just on the basis of some financial

jitters is unlikely. Austerity measures employed across EU

would bring down the debt level. European Union was

thought to be strict about its clauses of treaty, but it has

already softened on the no bail out clause. And even the

deadline of 2012 would most probably extend. All in all

Disintegration of EU is a very unlikely scenario.

Swastik Dasgupta

PGDM IB (09-11)

POINT


nations to have budget deficit ceilings of 3% of GDP &

external debt ceilings of 60% of GDP by 2012. The chart

shows standings as of 2009.

Countries in EU were left with what is famously known as

and

economic stability, or instability. And clearly countries

have chosen to take-up social pain. Several austerity

measures are been implemented all across the EU to bring

down the Debt levels.

year and another 2.6 per cent in 2011. And similar would

be the condition of other PIIGS countries. Both Greece and

Portugal have already been hit by serious protests as a

result of budget cuts. The question stands, would all the

nations be able to push through the necessary reforms,

because without much-needed reform, the gap between

the strong and weak members of the euro zone threatens

to get even wider.

5 of 16 Euro zone states have public finances in shambles,

enough to make the entire Continent uneasy. Investors

fear that stable countries like Germany, Finland or the

Netherlands could ultimately be affected; that they may

be forced to pay for the financial errors of other EU

members in order to maintain the stability.

put together

said Stephen Lewis, senior economist at London-based

COUNTERPOINT

Several leaders in the bloc are doing all they can to avoid

representing half a billion people, 7 percent of world

consumers and a fifth of world trade.

of exiting from the crisis. With the Euro that is some

Symbiotic association is slowly turning out to be a

parasitic association.

Can the stability of the whole union be bought at the

expense of few well off economies? Being in Union would

mean more threat to countries like Germany, Netherlands

and others who would have to carry the burden of the

limping nations. And all this is just to ensure that the

caused by contagion effect.

Is it right to use tax payer s hard earned money for

would imply a direct impact on all the 27 member nations

even if something goes wrong with one. Even if one

country fumbles and decides to withdraw from the Union,

it will send out shock across the whole world and may

even lead to immediate disintegration. With so much

happening around the world and in Europe, the stability of

EU is questionable.

Akhilsingh Patil

PGDM IB (09-11)

e- GlobuzZ, Volume I, Issue III July - September 2010 Page | 21

Empty Repo

The movement of empty containers

GDSM

Abbreviation for "General Department Store Merchandise."A classification of

commodities that includes goods generally shipped by mass-merchandise

companies. This commodity structure occurs only in service contracts.

Astern

Behind a vessel. Move in a reverse direction.

Beam

The width of a ship.

Jacob's Ladder

A rope ladder suspended from the side of a vessel and used for boarding.

Longshoreman

Individual employed in a port to load and unload ships.

DID YOU

KNOW

THESE

TERMS ???

Bunkers

A Maritime term referring to Fuel used aboard the ship.

Coal stowage areas aboard a vessel in the past were in

bins or bunkers.

Bull Rings

Cargo-securing devices mounted in the floor of

containers; allow lashing and securing of cargo.

Car Pooling

Use of individual carrier/rail equipment through a

central agency for the benefit of carriers and shippers

Sonam Doshi

PGDM IB (09-11)

e- GlobuzZ Volume I, Issue III July - September 2010 Page | 22

B O O K R E V I E W

COMPETING FOR THE FUTURE

Competing for the future by C. K. Prahalad and Gary Hamel is an

excellent book on strategy guiding the managers of companies to

think innovatively. It is a masterful blueprint for what a company

should be doing today if it is to occupy the competitive high ground

of tomorrow. Although this masterpiece was written about two

decades ago, it is very relevant today in the rapidly changing business

environment.

The book talks about three phases of competing for the future viz.

intellectual leadership, management of migration paths and

competition for the market share. There are two aspects occupying

attention. Restructuring and re-engineering.

Neither is an alternate for imagining and creating the future.

Competing for the future requires not only a redefinition of strategy,

To create the future a company must change in some fundamental

way the rules of engagement in a long standing industry, redraw the

boundaries between industries and create entirely new industries.

Creating the future is more challenging than trying to catch it. The

goal is not to benchmark a

imitate them, but to develop independent point of view about

how to create and exploit them. To get to the future, a company

must be willing to jettison its past, at least in part. What prevents

companies from creating the future is installed base of thinking

the unquestioned conventions, myopic view of opportunities and

threats, and the unchallenged precedents that comprise the

existing managerial frame. To beat competition, the best way is to

be the first to start alternative value delivery systems, the first to

BY GARY HAMEL & C.K PRAHALAD

Creating the future is more

challenging than trying to

catch it. The goal is not to

products and services or

imitate them, but to

develop independent point

of view about how to create

and exploit them.

Prof. C.K. Prahalad

Prof. GARY HAMEL

e- GlobuzZ Volume I, Issue III July - September 2010 Page | 23

B O O K R E V I E W

the future. Competing for the future must be a corporate

responsibility. The competencies needed to access the new

opportunity arena may well be spread across a number of

business units, and it is up to the corporation to bring these

competencies together at the appropriate point within the

company.

The book explains that firms should compete for industry

foresight. The goal of competition for industry foresight is, at one

level, simple: to build the best possible assumption base about

the future and thereby develop the prescience needed to

proactively shape industry evolution.

Crafting strategic architecture is another important aspect to

compete. It identifies the major capabilities to be built, but

A strategic architecture may point out the way to the future,

provides the emotional and intellectual energy for the journey.

Strategic architecture is the brain; strategic intent is the heart.

A company should work to shape the future according to its

own standards. Getting to the future first may enable a

company to be the first to establish a virtual monopoly in a

particular new product category and may also enable a

company to establish the rules by which other companies have

to compete. It also explains the vital importance of core

competencies, they being the gateway to the future. A

company that fails to understand the core competence basis

for competition in its industry may be surprised by new

entrants who rely on competencies developed in other end

markets. In the evolving global competition, growth and

diversification will increasingly be a function of core

competencies and core products rather than an extension of

existing products. Towards the end the book details out ways of

securing the future and thinking differently.

By showing that the key to future industry leadership is to

develop an independent point of view about tomorrow's

opportunities and build capabilities that exploit them, the

authors reveal an entirely new perspective on what it means to

be strategic--and successful. The book is a must read for both

the corporate executives and the business school faculty and

corporate managers. Hamel and

Prahalad argue persuasively that traditional approaches to

strategic planning are unlikely to prepare a firm for sustainable

industry leadership in the future.

Soniya Sahita

Iti Purohit

PGDM IB (09-11)

A strategic

architecture may point

out the way to the

ambitious and

compelling strategic

intent that provides

the emotional and

intellectual energy for

the journey.

CROSSWORD # 03


ACROSS

1. A Japanese term describing a loose

conglomeration of companies organized around a

single bank for their mutual benefit.(8)

2. Political system where the state, usually under

the control of a single political person, faction, or

class. (12)

3. Bond which is issued in several countries at the

same time.(10)

4. usage-based payments made by one party to

another for ongoing use of an asset, sometimes

an intellectual property (IP) right.(9)

5. Rise in the general level of prices of goods and

services in an economy over a period of time.(9)

6. Efforts by FACB and IASC to move toward a

common global set of accounting standards.(11)

7. Process of returning a person back to one's

place of origin or citizenship.(12)

8. Using the earth or earthly life as the only basis of

evaluation. (10)

9. System of organization replete with overlap,

multiplicity, mixed ascendancy, and/or

divergent-but-coexistent patterns of relation.

..(10)

10. kind of tax, often associated with customs, a

payment due to the revenue of a state, levied

by force of law.(4)

11. South Korean form of business

conglomerate.(7)

12. Protectionist trade restriction that sets a

physical limit on the quantity of a good that can

be imported into a country in a given period of

time.(5)

DOWN

1. Japanese process of continuous

improvement (6)

13. Situation in which cooperating company

takes an equity position in the company with

which it has collaborative arrangement.(13)

14. Standardized and simplified conceptions of

groups based on some prior assumptions. (10)

15. Third month of English calendar.(5)

16. Association of two or more individuals,

companies, organizations or governments (or any

combination of these entities) with the objective

of participating in a common activity or pooling

their resources for achieving a common goal.(10)

17. Individual whose ideas and behavior serve as

a model to others.(13)

18. Term used to describe a policy regime which

encourages exports, discourages imports,

controls capital movement and centralizes

currency decisions in the hands of a central

government.(15)

Sonam Doshi

PGDM IB (09-11)

Date post:	14-May-2015
Category:	Business
Upload:	prerna-makhijani
View:	302 times
Download:	2 times