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2. Industry Fashion Customer preference; Competitive
Reference No. INA0078 environment; US Auto industry
Industry Analysis
Year of Pub. 2009
Fashion Industry: Can Asia Buck Teaching Note Available
the Trend?
Struc.Assign. Available
The US Newspaper Industry at
Keywords Crossroads?
Well, how does one define fashion going
global – When a Gucci or Armani is Asia, Oriental, Fashion, Blue Ocean The print newspaper industry of the US
displayed on the fashion streets of Japan Strategy, SWOT Analysis, GAP Analysis , has been witnessing revenue decline since
and China or when celebrities like Liz Japan, China, Europe, Retail, Gucci, Global, 2005. Decreasing circulations and
Hurley or Will Smith showcase themselves Brand, Apparel, Supply chain consequently decreasing advertising
in an Asian outfit? The winds of global revenue, due to the increasing popularity
fashion industry are changing their course of digital media, is said to have affected
– no more do fashion winds move only the print medium. Many newspaper
CAFE Fuel Rules: Changing Auto
from west to east but they blow from east companies initiated several cost cutting
to west too. Asian fashion, of late, has
Industry Dynamics in the US efforts to cope up with the industry
made its presence felt on the global ramp. In a move to increase fuel efficiency and downtrend. The increasing online
For centuries, western brands like Gucci, to reduce gasoline usage for travel, a bill advertising revenue at the US newspaper
Versace, Armani and LVMH maintained was passed by US Federal government websites put forth a notion that the
their supremacy in the world of fashion. raising the standards of Corporate Average industry will undergo a paradigm shift from
Innovation, rich designing, marketing Fuel Economy (CAFE) standards to 35 the print medium to the online medium.
expertise coupled with the presence of miles per gallon (mpg), to be achieved by Many analysts believed that the US
excellent fashion connoisseurs, enabled the 2020 from the current standards of 27.5 newspaper organisations will retain their
western brands to command a premium mpg for passenger cars and 22.2 mpg for local franchises in print format, as it
over the years. In comparison, the Asian trucks. US car manufacturers like GM, Ford contributes significantly to their revenue.
fashion industry, which is still in the nascent and Chrysler were apprehensive of this However, speculation is rife about the
stage of growth, has been trying vigorously decision as they were in doubt in achieving future of US print newspaper industry as
to position itself among the global players. the proposed standard in 12 years. The the focus shifts to the online medium.
Although oriental fashion is pulling huge automakers were left with two options –
crowds to its fashion weeks, the Asian either make cars more expensive or make Pedagogical Objectives
fashion industry, despite talented designers them smaller and less powerful. By
and lean manufacturing processes, is failing upgrading their manufacturing processes • To analyse the increasing popularity of
to build a brand image in the high-end and investing in expensive technology, new media over the traditional media in
luxury segment. Factors like low brand they hoped to reach the standards set by the US
value, lack of technical know-how, the Act. It was also found that Japanese • To provide an overview of the US
infrastructure and distribution networks manufacturers like Honda or Toyota were newspaper industry and the competitive
have been hampering their growth closer to the proposed standards as scenario
opportunities globally. compared to the 'Detroit 3' and European
car manufacturers. On the other hand, • To analyse the various factors that affect
This case study dwells upon the dynamics the US print newspaper industry
of the global fashion industry and the fearing a rise in oil prices, consumers are
comparative position of the Asian fashion looking for fuel efficient and compact cars. • To analyse how the US print newspaper
industry. The case study also analyses the Consumers as well as market analysts industry can hold its audience and
challenges and threats to Asian fashion presume that new CAFÉ standards can be increase its revenue.
designers and brands from global players met by 2020 which is in contradiction to
besides providing a scope to identify the the view of the automakers. The case Industry Newspaper Publishing
ways in which Asian fashion industry can attempts to profile the needs of consumers Reference No. INA0076B
create an uncontested market space and and expertise of auto-manufacturers, in Year of Pub. 2008
make competition irrelevant. the wake of new CAFÉ rules. Teaching Note Available
Struc.Assign. Available
Pedagogical Objectives Pedagogical Objectives Keywords
• To understand and analyse fashion • To comprehend the implications of US Newspaper Industry; NAA; WAN;
industry dynamics in a flat world (market environmental regulations on industry Digital Media; Ad spend; Classified ads;
share, profit margins, value chain, etc.) dynamics Consumer spectrum; Interactive
• To understand the impact of CAFE bill marketing; New media; Internet
• To analyse the critical success factors advertising; Crossroads; Newspaper
for fashion industry and debate on on US customers and auto manufacturers
websites; Business models; Google; Yahoo
whether they would change when the • To understand the prospects and
companies go global challenges of US auto industry.
• To understand the Asian fashion Industry Auto Industry Indian Animation Industry:
industry's capabilities and contrast them Reference No. INA0077C Roadblocks for Global
with the global fashion industry's critical Year of Pub. 2008 Competitiveness
success factors Teaching Note Available
Struc.Assign. Available Since 2005, India witnessed an increase in
• To debate on the essential requisites for
the amount of work related to animation
any Asian fashion house to go global Keywords outsourced to India. Most of the companies
and the strategies they should follow to
CAFÉ rules; Environmental Standards; that outsourced such work were from the
position themselves so as to successfully
Industry Analysis Case Studies; Big three; Europe, US and also Asia. Though there
compete with the incumbents.
Detroit three; Japanese Automakers; has been an increase in the volume of
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3. outsourced projects and co-production (14.4% to 2.17 million units). The demand at much lower prices. Whether Nikon
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deals, the animation content in the form for such scooters increased in Indian two- would be able to successfully fight grey
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of movies and television content did not wheeler market due to improvement in market issue in India was yet to be seen.
seem to entice the Indian audience. This product features, design and style; and was
cast doubts on the competitiveness of the targeted to attract young college girls, Pedagogical Objectives
Indian animation industry. This case study housewives, and teenagers. Looking for
examines the various hurdles that Indian growth, Suzuki launched gearless scooter • Dynamics of compact camera market
animation companies need to cross, not 'Access 125' (Access) in the 100cc to 150cc in India
only to appeal to the local market but also segment to compete with its competitors • Market entry strategies of Nikon in
to become globally competitive. like Honda, Kinetic, and Bajaj. But still, a India
segment of customers preferred
Pedagogical Objectives motorcycles because of bigger wheels, • Strategic implications of grey markets
better road grip, power, higher ground
The case study helps in understanding • Nikon's strategies to fight grey markets.
clearance, and low maintenance cost
• The growth of global animation industry compared to scooters. The case facilitates Industry Compact Camera Market
discussion on whether Suzuki would be able Reference No. INA0073A
• Growth prospects of the Indian to succeed in capturing these buyers mind Year of Pub. 2008
animation industry in relation to the space. Teaching Note Available
worldwide markets Struc.Assign. Available
Pedagogical Objectives
• Inadequacy of the Indian animation Keywords
industry to compete globally. • To examine the growth drivers and
Nikon Corporation; Compact Camera
Industry Animation Industry
demand factors of Indian two-wheeler
market Market in India; Grey Market; Compact
Reference No. INA0075B Camera; Single Reflex Camera (SLR);
Year of Pub. 2008 • To understand the importance of Canon India; Kodak India; Nikon's
Teaching Note Available continuous innovation in two-wheeler Coolpix; Industry Analysis Case Study; Grey
Struc.Assign. Available market Market; Digital Cameras; Product
Keywords cannibalisation; Brand Image; Brand
• To study the impact of consumer Building
India; Emerging economy; Animation; behaviour in Indian two-wheeler industry
Global animation Industry; Indian • To discuss whether the strategies adopted
animation Industry; Roadblocks; by Suzuki would help it succeed in Indian Hotel Industry (A): The
Developing nations; Financial News;
Outsourcing; Intermediaries; Industry
shifting the consumer priorities from Competitive Dynamics
motorcycles to gearless scooters in
Analysis Case Study; MNCs; Animation India. Fuelled by the country's booming economy,
outsourcing hub low-cost air carrier introduction and
Industry Automobile Industry
liberalisation of FDI norms that allow
Reference No. INA0074A
100% foreign investment in real estate,
Year of Pub. 2008
Suzuki in India: The Growing Teaching Note Available
the Indian hotel industry is currently seeing
Gearless Segment of Indian Struc.Assign. Available
a boom. Demand for hotel accommodation
has increased tremendously across India but
Two-Wheeler Market
Keywords the rooms' supply has seen an insignificant
The world's second largest manufacturer growth, causing staggering room rates and
of two-wheelers – the Indian two-wheeler Indian Two-Wheeler Market; Industry insufficient room availability. Inbound tour
industry is broadly classified into three Analysis Case Study; Transportation; operators blame these as key deterrents
product segments – scooters, motorcycles Consumer Behaviour; Motorcycles; that keep tourists from visiting the
and mopeds. During 1980, the de-licensing Gearless Scooters; Marketing Strategy; country. Moreover, with poorly facilitated
policy of Indian government allowed Joint Venture; Competition; Foreign airports, inadequate road infrastructure,
foreign companies to operate in Indian Players; Product Innovation; Suzuki; high taxation levels and a bureaucratic visa
two-wheeler market through joint ventures Honda Motorcycle & Scooter India (P) processing system, India's hotel industry
(JV). Especially, the entry of Japanese Ltd.; Hero Honda; Bajaj Auto; Kinetic; has serious challenges ahead. Significant
companies changed the dynamics of Indian LML investments in tourism infrastructure are
two-wheeler market by concentrating on essential for this industry to progress and
customer aspirations, and embracing new ultimately achieve its potential.
technology. Banking on the opportunity, Compact Camera Grey Market
during 1982, Suzuki Motorcycle India Pvt. in India: Nikon's Dilemma Pedagogical Objectives
Ltd (Suzuki), a subsidiary of Suzuki Motor
Corporation (SMC), entered the Indian Sensing the fast growth in the Indian • To understand Indian hotel industry
two-wheeler market through a joint camera market, Nikon Corporation, a dynamics before and after the country's
venture partnership with TVS Group, an Japan based camera brand, in 2007, decided economic liberalisation and analyse the
Indian company, to manufacture to set up a subsidiary in India. Nikon was a key success factors of the industry
motorcycles. Until 2000s, the motorcycles late entrant and players like Sony, Canon, • To examine the Indian hotel industry
were more popular in Indian two-wheeler Kodak and Samsung had already established segmentation and contrast it with the
market. But the launch of gearless scooter themselves as key players in the Indian country's economic development and
'Honda Activa' – a four-stroke scooter by market. To establish itself in the Indian room prices
Honda Motorcycle and Scooter India Pvt market, Nikon had to compete with these
Ltd (HMSI) in 2001, changed the demand established players. Apart from this, the • To highlight global hotel chain's growing
dynamics of Indian scooter segment. Since presence of grey market was a serious presence in India and the various market
2007, the gearless scooter segment has concern for Nikon. Nikon's own products entry strategies available for them to
been growing as compared to motorcycles were widely being sold in the grey market establish their presence in India
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4. • To analyse Indian hotel industry's Pedagogical Objectives and how it has changed the meaning of
demand-supply mismatch, the reasons business over the decade. Specifically it can
Industry Analysis
for it and the necessary steps to fill the • To understand the dynamics of the be used to:
gap. Chinese B2B E-commerce market
• To understand the difference between
Industry Hospitality Industry
• To analyse the business methodology of Internet economy, electronic business
Reference No. INA0072
the Alibaba group and electronic commerce
Year of Pub. 2008 • To discuss the risks of online business,
Teaching Note Available
• To discuss the significance of digital
especially in global expansion economy vis-a -vis traditional economy
Struc.Assign. Available
• To understand the importance of • To understand the constituents of e-
Keywords efficient and adequate business model in commerce business
Indian Hotel Industry; Industry the growth of an online business.
Segmentation; India's Economic • To analyse the critical success factors
Industry E-Commerce
Liberalisation; Industry Classification; for the growth of e-commerce
Reference No. INA0071
SWOT Analysis of Indian Hotel Industry; Year of Pub. 2008 • To debate the relevance of e-commerce
Critical Success Factors; Challenges in the Teaching Note Available business in China
Indian Hotel Industry; Role of Government Struc.Assign. Available
in Industry's Development; Industry • To understand the resulting business
Analysis Case Study; Taj and Oberoi Group Keywords opportunities and challenges.
of Hotels; Market Entry Strategies; Global E-commerce; Dynamics of online business; Industry E-Commerce
Hotel Chains in India; Incredible India Alibaba.com; Internet commerce; Chinese Reference No. INA0070
Campaign; Demand Supply Disparity electronic commerce; China in global e- Year of Pub. 2008
eommerce; Digital economy; Critical Teaching Note Available
success factors of e-commerce; Industry Struc.Assign. Available
Emergence of China in the Analysis Case Study; Strategies of
Keywords
Global E-Commerce Market (B): Alibaba.com; Internet economy
Alibaba.com's Surge E-commerce; Dynamics of online business;
Industry Analysis Case Study; Electronic
Second in the two case series, this case
Emergence of China in the global marketplace; Internet commerce;
portrays Alibaba.com, a portal that Chinese electronic commerce; China in
withstood the Chinese and emerged as a Global E-Commerce Market (A):
global e-eommerce; Digital economy;
leader in a short span of 9 years. Launched Dragon Drags on Adaptation Critical success factors of e-commerce;
in 1999, the portal targeted SMEs One of the most popular economic stories Opportunities and challenges of e-
providing Business to Business (B2B) in the last decade and half was the emergence commerce; Internet economy; Old
solutions and aggressively expanded the of China as a formidable force in the global economy and New Economy
customer base by tailoring its offerings to economy. With the growth booming at more
various SMEs. Alibaba's web presence than 10% per annum, all sectors of the
includes an international marketplace,
which focuses on global importers and
Chinese economy got the required thrust, Luxury Brands in China: Profiting
E-commerce being one of them. Internet from Scale
exporters, and a China marketplace penetration in the country registered
focusing on domestic suppliers and buyers. dramatic surge, as the Chinese establishment China’s 1978 economic reforms helped
Alibaba's business and operational patterns eased regulations and foreign multinationals boost its economic growth and in turn, the
helped it to become the highest market provided the required know-how along with income levels there. China’s demography
valued firm. This enabled the company to necessary hardware. Once the infrastructure too changed - with thousands of
be listed on the Hong Kong Stock was in place, the Chinese business millionaires and a growing middle class
Exchange in November 2007. And set its community was quick in embracing E- coming up. All this had an impact on the
sights on global expansion, also offering commerce. However, the common country’s luxury industry, whose growth is
more services to its domestic clients. populace was not quick enough, being pulled expected to jump from 1% in 2000 to 29%
Though hailed as a good strategy, as the back by many apprehensions – chief among by 2015, making it the largest market for
incremental revenues will out do them were lack of physical feel of the luxury brands. However, China is a
incremental costs by miles, it has its own products and security (over privacy and complex cultural market.
risks. Company's success of the company payments) – ultimately E-commerce has
depends on its ability to tailor itself to
suite the needs of global diversities – not a
not gained expected popularity. Albeit Pedagogical Objectives
slowly, number of people purchasing online
mean task by any measure and not many is picking up – much to the liking of Chinese The case study helps students:
portals could achieve in the past. This case e-commerce companies. This case study,
enables analysis on the strategies, which • Analyse the impact of China’s economic
the first in the two case series, enables a
the company has adopted in its initial reforms
discussion on why e-commerce failed to
stages to establish itself facing adverse attract Chinese public, though it had all the • Discuss the growing demand for luxury
conditions. How could Alibaba.com install necessary ingredients. Why was Chinese brands
faith in its customers in such a short span public averse to online transactions? What
of time? What measures did the company strategies did the companies adopt to • Assess Chinese consumer behaviour
take to overcome the resistance of the increase the popularity of E-commerce?
Chinese? Is the company too ambitious in • Discuss various strategies
How China was able to establish itself on
its global plans? Can the company handle global E-commerce market place? • Analyse the challenges for players.
diverse needs of foreign and domestic
customers? What measures should it take Industry Luxury
to succeed the complexities involved in Pedagogical Objectives Reference No. INA0069
global expansion? Which regions should it Year of Pub. 2008
The case study is meant to understand the
focus on? Teaching Note Available
importance of electronic form of business
Struc.Assign. Available
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5. Keywords Industry Internet Search & Navigation prompt customers to buy the new product.
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Then the growth phase sees rapid market
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Services
Luxury Brands; Counterfeiting; Luxury Reference No. INA0068 expansion and increasing competition, with
Retailing; Tourism and Luxury Industry; Year of Pub. 2008 the entry of new players. In these two
Brand Image; L’Oreal; LVMH; Teaching Note Available phases, a lot of evolution (both in terms
Competition; Critical Success factors; Struc.Assign. Available of products and markets) happens. Products
Market Entry Strategies; Consumer undergo many changes with the application
Behaviour; Industry Analysis Case Study; Keywords of new technologies, rising demands and
Industry Dynamics; Brand Building; varying choices of consumers. This case
Challenges for Luxury Goods Companies Google; Baidu.com; China’s Search Engine
Market; Business Model; Industry Analysis study sees how Motorola dealt with such
Case Study; Globalisation and Localisation; evolution in an emerging market. Motorola
CAGE Frame Work; Alliance Strategies; was the first to enter the Chinese mobile
Google vs Baidu.com (C): The Acquisitions and Partnerships; Chinese phone market in 1987. So it was blessed
Battle for China’s Internet Search Google; Government Business with the First Mover Advantage for nearly
Market Environment; Internet Censorship; Online 15 years. However, with the evolution of
Advertising; International Business; Legal Chinese telecom industry, improvements
From being an emerging economy, China Environment and Regulations in mobile networks there and entry of new
is a surging one and the number of its competitors (local and foreign), Motorola
Internet users is swelling. With that, the began to lose its market share. But China
number of companies offering search became a crucial market for Motorola, as
services there is also going up. Google, the Motorola in China (B): From its western markets dried up.
preferred search engine in many countries ‘Intended’ to ‘Emergent’
beats its rival Yahoo! by a wide margin. Strategies Pedagogical Objectives
Yet, in China - forecast to be the largest
Internet market in the world - Google finds This case study is a sequel to Motorola in • To understand the evolution of China’s
itself upstaged by a local rival, Baidu.com. China (A): Dealing with an Evolutionary mobile industry and the operating
China’s cultural nuances seem to Industry Life Cycle. This case explains how challenges
completely elude Google. The company Motorola tuned its strategies to emerging
trends. Actually, by January 2003, its going • To discuss and analyse strategy
to find a foothold in China, is however,
was becoming tough in the Chinese market. formulation in the evolutionary phase
leaving no stone unturned. It has opened
Most of its invented strategies failed. Then of an emerging market
an office in 2005, hiring a Chinese at the
helm. The company is working to improve it realised that its strategies can no longer
• To discuss whether First Mover
its sales force. Along with this, Google in neglect the market trends. Viability of these
Advantage can guarantee success in the
China has launched a censored Chinese emergent strategies can be vividly
long run.
version of its site in 2006, which is a first discussed.
Industry Telecommunications
for the company. This case, the third in
the series, Google vs Baidu.com, details the Pedagogical Objectives Reference No. INA0066
Year of Pub. 2008
Chinese online search landscape along with • To analyse and discuss the causes of Teaching Note Available
the major players. The focus is on the Motorola’s failure in China’s mobile Struc.Assign. Available
ongoing battle between Google and Baidu, phone market, in spite of having the
and the reasons for their failure and success First Mover Advantage Keywords
respectively. The case facilitates a
discussion on the critical success factors • To analyse whether its emergent Motorola; China Handset Market;
for search engines and the need for strategies are workable and sustainable. Economic reforms in China; Mobile
localisation. The business dilemma of Phones; Motorola and Eastcom; Industry
Industry Telecommunications Analysis Case Study; Motorola and Nokia;
choosing between ethical behaviour and
Reference No. INA0067 Centrally planned economy; Industry Life
shareholder wealth creation is also briefly
Year of Pub. 2008 Cycle; Intended Strategies; Emergent
dealt with. The case finally dwells on
Teaching Note Available Strategies; First Mover Advantage; First
whether Google, after making changes to
Struc.Assign. Available Mover Disadvantages; Chinese Guanxi;
its approach, will be able to succeed in
China and what should be its plan of action. Keywords Chinese Business Environment
Pedagogical Objectives Motorola; China Handset Market;
Economic reforms in China; Mobile
China’s Retail Industry (B):
• The critical success factors for a search Phones; Motorola and Eastcom; Industry
engine and whether these factors need Analysis Case Study; Motorola and Nokia; Consumer Behaviour and
to be localised Centrally planned economy; Industry Life Competitive Responses
Cycle; Intended Strategies; Emergent While case (A) enables an analysis of
• The Chinese Internet search market and Strategies; First Mover Advantage; First
what makes it attractive to China’s retail industry dynamics, case (B)
Mover Disadvantages; Chinese Guanxi; provides scope for analysing Chinese
multinationals Chinese Business Environment consumer behavior (with specific reference
• Why Google, otherwise the leading to retailing). Using this analysis, students
Internet search provider worldwide, is can decode the variety of competitor’s
losing out in the Chinese market to a Motorola in China (A): Dealing responses Each one wants to their slice (a
local player that has no presence with an Evolutionary Industry Life bigger one though) of the retail cake.
overseas
Cycle Whose strategic moves are viable? Which
• The business dilemma between ethical company is better poised to tap China’s
An industry’s life cycle runs through four retail potential? Since economic reforms
behaviour and what may be construed as
stages: introduction, growth, maturity and in the 1980s, China’s production and
foolishness by exiting a lucrative
decline. In the first stage, companies productivity rapidly grew, while average
emerging market.
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6. consumption growth was slower. No doubt, online music stores and supermarkets. But many more are embedded into this case
consumers create a huge retail potential. When the giant retailers are struggling by series that can be unearthed with meticulous
Industry Analysis
But, do they have similar aspirations? So, selling all-things-to-all-people how could analysis. Retail industry is one among the
what should companies assume? Do their FOPP survive by selling just CDs, DVDs, many that saw intensified competition
assumptions mismatch consumer books and gift items to one consumer during the past decade, in China.
aspirations? More so, as the Chinese segment? How long can the patronage in Competition is not yet even because of
consumer tends to save more than spend, these dynamic times last? Now, when huge untapped potential; so a discussion
how can retailers get them to do the internet is posing the biggest threat to every on Industry Life Cycle can ensue. It is for
reverse? other seller, can the company sustain? If the players to strategise their moves and
yes, how long? If no, does the company counter-moves, where value chain analysis
Pedagogical Objectives need to change its business approach? would prove essential. Market entry
strategies of Wal-Mart and Carrefour would
• To understand the (ever-) changing Pedagogical Objectives make up for an interesting analysis.
consumer behaviour in China and debate
its effects on the way retail companies • To understand unique business dynamics Pedagogical Objectives
respond of music industry and also music retailing
• To give a brief overview of retail
• To juxtapose and analyse the obvious • To analyse the critical success factors in industry’s formats and the operational
paradoxes in these responses (which can the music retail industry dynamics involved
help better in converting adversities into
advantages?) • To understand and relate consumer • To understand the potential and
behavior in music retail industry to the attractiveness of China’s retail industry
Industry Retail target market selection.
Reference No. INA0065 • To analyse the challenges of operating
Industry Entertainment
Year of Pub. 2007 in China’s retail industry because of its
Reference No. INA0064
Teaching Note Available value chain
Year of Pub. 2007
Struc.Assign. Available
Teaching Note Available • To debate on the critical success factors
Keywords Struc.Assign. Available in China’s retail industry
Wal-Mart; Carrefour; Chinese Consumer Keywords • To analyse the market entry strategies
Behaviour; Economic reforms in China; of Wal-Mart and Carrefour and debate
Centrally planned economy; Investment- Music Retailing; Customer Segmentation; on their effectiveness.
led growth; Industry Analysis Case Study; Customer Targeting; Niche Marketing
Consumption-led growth; Organised retail Fopp; Industry Analysis Case Study; Fifty Industry Retail
industry; China’s traditional retail industry; Quid Bloke; Music Labels; Music Recorders; Reference No. INA0063
Re-balancing of the economic growth; Universal Music Group; Sony BMG Music Year of Pub. 2007
Saving patterns in China; Consumption Entertainment; HMV; Customer Teaching Note Available
patterns in China Community; Music Industry; Positioning; Struc.Assign. Available
Differentiation
Keywords
Wal-Mart; Carrefour; Economic reforms
FOPP, UK’s Music Retailer (A):
China’s Retail Industry (A): An in China; Retailing in China; Centralised
Profiting from Positioning? supply chain system; Logistics and Supply
Assessment of Potential and
Chain Management; Centrally planned
With the current trend of consumers Challenges
economy; State-owned department stores;
exploring music online and supermarkets
The first of this three-part case series helps Dalian Dashang; China’s traditional retail
offering CDs at competitive prices, stand-
richly and deeply analyse a happening industry; Metro AG; Ito Yokado; Industry
alone music retailers face an uphill task to
industry in China - retailing. Its competitive Analysis Case Study; Chinese Guanxi;
maintain real differentiation in the
dynamics is the fine thread that runs Retail industry dynamics
industry. The Fopp case series (A&B) track
the positioning, the challenges and the through all the three cases. Now that China
growth dilemmas of Fopp - a music retailer is on every global (MNC/TNC) company’s
with 105 stores spread across UK and growth agenda, the class can debate Global Steel Industry: The
Scotland. The company had been selling industry-specific dynamics as well as Country Factor
CDs, DVDs, books, and peripherals for about economy-wide factors. So bigger questions
25 years. Started in early 1980s, the retail pop out. What is the “China Factor”? The reconstruction of infrastructure across
chain has grown from a small corner shop What does this mean to the companies the world after the Second World War
to UK’s third largest music retailer. What operating or willing to operate in China? prompted steel industry rise sharply.
differentiates Fopp from its rivals is its What should be their homework before Demand exceeded supply resulting high
positioning to reach Fifty Quid Bloke: the entering China? What should be their profitability which translated into capacity
marketing name for people aged between strategic moves, while they are in China - augmentation. But since 1970’s the demand
25 and 45, who are cash-rich and time- strategy or tactics? With Chinese economy plummeted down, resulting over capacity
poor. A typical Fifty Quid Bloke is seen on integrated into the global economy (since and high cyclicality in the Industry. The
a Friday afternoon buying piles of CDs, all 1978 and more so from 2001 when it industry regained from 2002 due to China’s
worth £50, thereby giving the company formally joined the WTO), its economic booming economy, higher economic
more revenue per visitor. The company is growth rate has hovered around 10%–12%. developments in other BRIC (Brazil,
said to have developed strong patronage And that’s very good news for all the major Russia, India) countries, emergence of CEE
with these music followers. Case A describes global corporations because there is huge (Central and Easter Europe) countries as
the dynamics of the music industry in demand there. However, this good news rapidly developing economies and positive
general and UK’s music retail industry in has a flip-side too: China’s business terrain economic developments in Triad (Europe,
particular, and will trigger a discussion on is bumpy for a variety of reasons. What USA and Japan) etc. Analysts were
Fopp’s positioning strategy against the are those reasons? Hard infrastructure and skeptical about the long term sustainability
soft infrastructure are the prime suspects. of the industry. The concern is vital for
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7. the senior managers and the policy makers • To understand the US real estate market • To debate the ethical participation by
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in the steel industry to understand the developed and developing countries on
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dynamics of this industry and to shape their • To analyse the volatilities in the US real humanitarians ground in carbon trading.
strategies accordingly. estate market
Industry Carbon market
• To debate whether the US real estate Reference No. INA0060A
Pedagogical Objectives market would recover after the downturn Year of Pub. 2007
started in 2006. Teaching Note Not Available
• An outlook of global steel industry
Industry Real Estate Struc.Assign. Not Available
• Factors affecting the demand and supply Reference No. INA0061K
of the global steel industry Keywords
Year of Pub. 2006
• The impact of China, BRIC, TRIAD and Teaching Note Not Available Carbon dioxide; Greenhouse Gases; Industry
CEE economies on the global steel Struc.Assign. Not Available Analysis Case Study; Kyoto Protocol;
industry Carbon trading; Emission Trading; Global
Keywords Warming; Climate Change; Annexure I
• Opportunities and challenges for the US real estate; United States housing bubble; countries; Annexure II countries; Assigned
players in the global steel industry. Industry Analysis Case Study; Economic Amount Units; Emission Reduction Units;
Industry Steel bubbles; Stock bubble; P/E (price-to- Chicago Climate Exchange(CCX); EU ETS;
Reference No. INA0062K earnings) ratios for houses; National UK ETS; New south Wales market (NSW);
Year of Pub. 2007 Association of Realtors; Speculation; House Joint Implementation; Clean Development
Teaching Note Available price index; Baby boomers; Downtrend in mechanism (CDM)
Struc.Assign. Available housing; Foreclosure; US mortgage rates;
Stock vs house investment; Collapse in
Keywords housing; Housing wealth Chinese Automakers'
CEE; TRIAD; Steel Production; BRIC; International Drive
Value Chain; Arcelor-Mittal; Baosteel;
Fragmentation; Industry Analysis Case Kyoto Protocol and its effects on Following the footsteps of their Asian
predecessors Japanese and South Korean
Study; Downstream Production; the carbon trading automakers all major Chinese automakers
Investment Trap; Global Steel Industry;
Regional Champions; Niche Specialists; Carbon Market, the new concept of trading like Geely, Cherry and other leading auto
Global Player; Steel Cycle Carbon dioxide (CO2) and other companies aspired to become global
Greenhouse gas was much similar to the players. With the advantages of low cost
other trading markets of the world. This production and government support,
concept came into force with the Chinese automakers primarily targeted US
US Housing Market: Waiting for implementation of the international treaty and European market to sell their cars and
Recovery called Kyoto Protocol, which envisioned consequently become powerhouse in global
reduction of Greenhouse Gas emission in automotive industry.
After experiencing a boom for a
considerably long period, the US Real Estate the world. The treaty was mainly applicable Nevertheless, Chinese automakers had
started declining from early 2006. The to the industrialized and developed many obstacles to overcome before selling
number of new housing projects dropped countries of the world. cars in international markets. The image
from an annual rate of 1.535 million to The first implementation period was 2007- of poor quality, weak design and lack of
1.486 million. Meanwhile, the mortgage 2012 which enforced many countries and distribution networks hindered the progress.
loans had reduced from a peak of 6.8% on industries around the world to maintain their Besides, the world automotive market was
average for a 30-year fixed loan in July to level of emissions. This also gave boost to saturating and analysts opined that the
6.24% in October 2006. The Federal rate carbon market around the world. This growth prospects were better in China
remained unchanged at 5.25% from the mechanism initiated major carbon itself.
month of August. There were speculations exchange and market around the world.
that the Federal Reserve could cut rates in Pedagogical Objectives
the coming months if inflation remained The case highlights the major carbon
under control and the economy flagged. trading markets around the world and the • To discuss the global and Chinese
This further slashed down the housing countries which would implement this automotive industry scenario
finance loans. All these triggered a recovery treaty. The treaty was rejected by leading
industrialized countries like US, Canada and • To discuss international market entry
but the market so far had not shown any barriers and strategies to overcome them
kind of bounce-back activities. Moreover, Australia. It also faces some challenges,
as the once-booming U.S. housing market debate and criticism by environmental • To discuss challenges faced by Chinese
came down in 2005-2006, economists activist. Amidst the challenges and automobile manufacturers in their quest
debated whether this was a "soft" or "hard" regulatory hindrances, the treaty promised to go global.
landing and the impact this slowing would to provide an initiative to prevent further
global warming. The case ends on the Industry Automobile
have on consumers' confidence and on the
debate whether Kyoto Protocol will Reference No. INA0059A
overall economy. This case captures both
achieve its vision by 2012. Year of Pub. 2007
the up and down trends of the US housing
Teaching Note Not Available
sector. The case further explores the factors
Struc.Assign. Not Available
affecting the housing sector and whether Pedagogical Objectives
there will be any recovery in the US housing
• To understand the concept of carbon Keywords
market.
trading and carbon markets Chinese Automakers; China Cars; Industry
Pedagogical Objectives • To understand the international treaty , Analysis Case Study; Automobile Industry;
Kyoto protocol and its mission and Globalisation; International Markets;
• To discuss how the economic factors are vision Expansion Strategies; Shanghai
related with the real estate market Automotive (SAIC); First Automobile
7
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8. Works (FAW); Dongfeng Motor outsourcing industry; BPO sector; contrast, the Chinese aviation market had
Corporation; Geely Automobile; Chery Offshoring become the second-largest in the world after
Industry Analysis
Automobile; Challenges of globalisation; the US, carrying 138 million passengers in
Exports; Low cost production 2005. Apart from that, Chinese airlines
ordered a large number of new aircrafts in
Organic Food Market in the US:
2005. Analysts felt that government
The Wal-Mart Effect interference in matters related operations
Emerging Destinations in
was the main reason behind airlines’ poor
Outsourcing: The Indian In the wake of a rapidly growing market for
performance. Though government was
organic products in the US, in March 2006,
dilemma reforming the airline industry to make the
Wal-Mart, the world’s biggest retail chain,
As of 2006, India continued to remain an announced that it would include more Chinese airlines more competitive, experts
IT outsourcing powerhouse, with $17.7 organic products in its grocery section. The doubted Air China’s ability to remain
billion revenue in software and IT services management of Wal-Mart hoped to attract profitable in the long run. The case discusses
exports, compared with $3.6 billion for more and more customers to buy its organic in detail the evolution of China’s aviation
China and $1 billion for Russia, according items thereby promoting the consumption industry to its present form as well as
to the trade organizations in each country. of organic products. While some analysts government reforms. It also discusses Air
Also, India's outsourcing industry was still believed that it would increase China and its operations. The concluding
growing at a faster pace than that of Russia's environmental awareness among the section attempts to highlight the
and other outsourcing centers. But as labor consumers and prompt the farmers and challenges that the Chinese aviation
costs and turnover rates began rising in supplier to adopt green practices, another industry (particularly Air China) faces. It
India, companies started looking out for set of analysts felt that Wal-Mart could use also tries to raise a question regarding the
cheaper labor. As a result, many alternative its market strength to exert pressure on structure of the industry in future.
outsourcing destinations emerged. farmers and suppliers to its own advantage.
Countries speaking European languages like Pedagogical Objectives
The case starts with a short history of
Hungary, Czech Republic, Russia, Poland,
organic farming in the US and moves on • To understand the evolution of China’s
Bulgaria and Romania were benefiting from
to Wal-Mart discussing it business briefly. aviation industry
the trend of 'nearshoring'. Moving IT
It then highlights Wal-Mart’s business
operations into developing countries can • To understand government reforms that
practices over the years and finally tries
pose big risks, such as language and cultural shape the structure of the industry
to raise a question regarding what could be
differences, geopolitical instability, and the
the possible repercussions of Wal-Mart’s • To discuss competitive dynamics of
risk of stolen intellectual property. India's
entry into the organics. Chinese aviation industry
outsourcing players needed to overcome
major challenges to continue their growth • To analyse the competitive advantages
and sustain their competitive advantage Pedagogical Objectives
of Air China
over other emerging outsourcing • To get an understanding of organic
destinations. India needed to improve its • To analyse Air China’s ability to sustain
farming
infrastructure, maintain competitive labor profitability in the long run.
costs and tackle the turnover rates of labor • To analyse the impact of Wal-Mart’s
Industry Aviation
attrition. It had to concentrate more on entry on the organic food market of the
Reference No. INA0056K
new areas in outsourcing such as E- US
Year of Pub. 2006
governance, Retail Services Outsourcing,
• To debate whether Wal-Mart’s entry Teaching Note Not Available
Pharmaceutical Research, Financial
would drive suppliers to adopt organic Struc.Assign. Not Available
Services and Healthcare.
farming or exert pressure on them for
lower prices. Keywords
The case outlines the changing global
scenario of the outsourcing industry, Air China; Chinese Aviation Industry;
Industry Organic Food
emerging destinations and challenges faced CAAC; CANC;Shanghai Airlines.
Reference No. INA0057K
by Indian outsourcing companies towards
Year of Pub. 2006
keeping competitive advantage and
Teaching Note Not Available
retaining business.
Struc.Assign. Not Available China’s Auto Industry: The
Keywords
Emerging Trends
Pedagogical Objectives
Wal-Mart; Organic food; Retailing; With China’s entry in the WTO in
• To introduce the students to the
Organic farming; National Organic December 2001, the domestic automobile
Outsourcing industry
Programme (NOP); Supercentre; Sam’s industry witnessed a plethora of changes.
• To highlight the various new destinations Club; Neighbourhood market; Grocery Overall tariff and non-tariff barriers were
coming up in outsourcing retailing; Industry Analysis Case Study; US reduced and the sector was opened up for
farmers; Organic seal; Supermarket; FDIs. China rapidly emerged as the third-
• Factors that constitute a successful largest automobile market behind the US
outsourcing destination. Discount store; United Food &
Commercial Workers and Japan, with about 3.1 million new cars
Industry Business Process Outsourcing being sold in 2005. The Chinese auto
Reference No. INA0058C industry was evolving gradually into a
Year of Pub. 2007 mature market with consumers becoming
Air China and the Chinese more aware of the differences between
Teaching Note Available
Struc.Assign. Not Available Aviation Industry brands.
Keywords By 2005, Air China was the only profitable The case while providing a broad overview
carrier among the three major airlines in of the Chinese automobile industry,
Outsourcing; Nearshoring; Emerging China. The other two, China Southern and discusses the emerging trends in the
destinations; Industry Analysis Case Study; China Eastern, were making losses. The industry as well as in the consumer
Indian outsourcing industry; Chinese low cost carriers also were struggling. By behaviour.
8
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9. Pedagogical Objectives Ukraine by Mittal Steel, potential • To understand how to make
S T R A T E G Y – III
S T R A T E G Y – III
S T R A T E G Y – III
synergies and problems associated with consolidation successful one, problems
S T R A T E G Y – III
S T R A T E G Y – III
• To understand the dynamics of the the acquisition associated with successful making of a
Chinese automobile industry in the pre- consolidation
and post-WTO era • To discuss how acquisition as a growth
strategy help companies to consolidate • Acquisition as a key growth driver in
• To understand the critical factors in fragmented steel industry global steel industry.
responsible for the emergence of
Chinese automobiles as the leading • To discuss the concept of ‘forward Industry Steel
brands, both in the domestic and integration’ and ‘backward integration’ Reference No. INA0053K
international market in steel industry Year of Pub. 2006
Teaching Note Not Available
• To discuss the global impact of the • To discuss how alliance with raw material Struc.Assig. Not Available
increasing export capability of the suppliers and ownership of mines help
Chinese automobile manufacturers steel companies to have better control Keywords
over the value chain of the industry
• To understand the changing dynamics Mittal steel; consolidation; value chain;
of consumer psychographics in China. • To discuss value chain of the steel global steel industry.
industry and steel making process.
Industry Auto
Reference No. INA0055K Industry Steel
Year of Pub. 2006 Reference No. INA0054K Auto Component Industry: A
Teaching Note Not Available Year of Pub. 2006 New Perspective
Struc.Assign. Not Available Teaching Note Not Available
Struc.Assig. Not Available According to a report by McKinsey and
Keywords ACMA in 2004 Indian auto component
industry was worth around $5 billion
China; Auto Industry; Cherry; First auto Keywords
(Rs.25,000 crore) and was growing at the
works; GM; Toyota; Volkswagen. rate of 18% yearly. But industry experts
Mittal Steel; CVRD; Riotinto;
Kryvorizhstal; Backward Integration. felt that in auto component exports, India
was far behind other developing countries.
Mittal's New Move: Capacity Indian companies did not have the scale of
Expansion or Vertical Integration production to beat global companies. The
L.N. Mittal: Consolidating Indian auto component industry was highly
In October 2005, Mittal Steel, the world’s Presence Globally fragmented as most of the auto makers
largest steel company, made a bid for belonged to Tier IV and Tier III category.
KryvorizhStal Steel, the largest steel Lakshmi Niwas Mittal (popularly known
High fragmentation, low investments in
company of Ukraine. In the era, when as LNM), also called the “Carnegie of
R&D, low capability in high-end designing,
consolidation and acquisition were Steel”, built his steel empire by aggressively
manufacturing and development hindered
common practices in the industry, Mittal acquiring poorly performing steel plants
Indian auto parts maker to move up the
Steel’s new move would help it to at low prices in 14 countries across the
value chain. Global OEMs and Tier 1
consolidate its presence more aggressively. globe, like Trinidad and Tobago,
suppliers were relocating their plants and
The acquisition was a key acquisition for Kazakhstan, Romania, Germany, Poland,
set up R&D centers from US/Europe to
Mittal Steel in Central Europe, as it Canada and America, and turning them into
India due to its low cost and skilled
provided the company with a large size money-making ventures. He is considered
manpower. But the majority of Indian auto
low cost platform in a core and fast growing to be industry visionary, spotting trends
component firms belong to the lower tier
market. It also helped Mittal Steel to much before his contemporaries and
of Industry value chain. Tier I
exercise control on the large iron ore investing accordingly. In October 2004,
manufacturers enjoyed advantages over
reserves of the Ukrainian Steel major, Mittal acquired International Steel Group
Tier II and Tier III suppliers in getting
which it planned to use in its expansion of the US for $4.5 billion and became the
orders with the help of their designing,
programme. In the steel industry, due to largest steel producer in the world,
manufacturing and development skills.
raw material shortage, the ownership of surpassing the world leader, Arcelor. The
Since Tier I suppliers got the order directly
mines and long-term alliances with the raw case study offers scope for discussion about
from auto makers it helped them to
material suppliers became a critical success the acquisition strategy, adopted by Mittal
recover the investments quickly and
factor for any company. The case study and how it helped him to become the
enjoyed better profit margins. Indian
offers a scope for discussing the rationale market leader. It also provides information
manufacturers, mostly belong to Tier III
of the acquisition in the recent global regarding the current and future levels of
and Tier IV category, lacked in high end
trends, the value chain of the industry and consolidation in the global steel industries,
designing, manufacturing and development
how Mittal Steel plans to leverage it. consolidation as a major strategy in the
skills. The case deals about how Indian auto
Students can also discuss how Mittal Steel steel industry, steel industry value chain
components industry which is in the un-
can leverage the acquisition by and the risks that companies like Mittal
organised sector, could exploit its
strengthening its position in Central and Steel, would encounter.
strengths, nullify its weaknesses and became
Eastern Europe and areas close to China. the preferred sourcing partner of global
Pedagogical Objectives OEMs ,by moving up the value chain of
Pedagogical Objectives • To understand the trends, dynamics of the industry.
• To discuss the trends, patterns of global global steel industry
steel industry and consolidation as a Pedagogical Objectives
• To understand how consolidation act as
major strategy in fragmented steel growth strategy in global steel industry • To discuss in details about global and
industry globally Indian auto component industry, trends
• To understand how consolidation and patterns of the industry
• To discuss acquisition of KryvorizhStal transform the globally fragmented steel
Steel, the largest steel company of industry into a consolidated one • To discuss the value chain of the auto
component industry
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