Founded in 2008, Harsh Electricals was a supplier of electrical goods and home appliances to retailers in three states of southern India. After the company’s first few years of success and high profitability, the founder observed a steep decline in profits. In 2013, the founder was considering shifting the business to manufacturing and supplying air coolers, but needed to build a business plan that addressed the costs of manufacturing, the break-even point, and the new venture’s projected financial statements.
By October 2014, Kumar Sweets was a successful sweets company in Kurukshetra, Haryana, India, well-known for Indian sweets made using a Kumar family recipe that had been passed down for generations. The company’s success was largely due to the continued efforts of its founder and head, but the founder’s eldest son sensed that something was wrong with the firm’s operations. Although revenue had increased over the years, the business had not been able to realize the expected profit. Since its last product expansion effort in 2011, Kumar Sweets’ profitability was lower than it had been in previous years; the founder and his son wanted to find out why, because they had hoped to pursue geographic expansion. Kumar Sweets needed to implement appropriate actions that addressed its existing problems as soon as possible.
In April 2014, the founder of SecureNow met with one of his classmates who was now an angel investor. The two had recently met socially and the founder had briefed his classmate on SecureNow’s online business-to-business insurance marketplace. The classmate was now expressing interest in investing in SecureNow but his valuation was much lower than the founder’s expectation. The founder was confident of SecureNow’s future growth, but he wanted funds to expand. His classmate would provide him with the kind of relationship he was seeking with an investor, but the founder wondered how he and his classmate arrived at such different valuations. He also wondered whether he should accept the funds at a low valuation, consider other options, or just postpone his expansion plans.
Shree Balaji Alumnicast Pvt. Ltd. (SBA) was a successful Indian metal recycling company and a pioneer in creating sustainable customer value through its closed-loop supply chain. In 2009, its biggest customer demanded a 15 per cent price reduction on alloys and threatened to withdraw its entire business if SBA failed to meet its demand within a given time frame. This customer contributed a significant share of SBA’s revenue and was thus indispensable. SBA could not simultaneously offer a price discount and retain its margins, which were already declining, through its current business and manufacturing practices. The company needed to rethink its strategy in order to maintain its growth trajectory, and find a better way of managing costs.
By 2009, since the introduction of liberal economic policies by the government of India in 1991, many Indian companies manufacturing leather cloth were closing down due to cheap imports from China and Taiwan. There had been no new investment or expansion in this field at all. In such a business environment and against the advice of many trade analysts, the chief executive officer of Northern India Leather Cloth Manufacturing Company Pvt. Ltd., based in the industrial town of Faridabad, India, decides to beat the competition by investing in new technology. He undertakes a rigorous examination of the company’s strengths, weaknesses, opportunities and threats, as well as listing and prioritizing four associated factors — technological, business, cultural and social, and financial — to identify the potential advantages and challenges associated with new technology absorption. Should he invest or not invest in new technology, and, if so, which of three possible technologies should he choose?<br><br>There is a supplement to this case, <br>9B14M069.
In this, the B case, the chief executive officer wonders how to enlist and prioritize important qualitative factors, along with financial factors in evaluating the shortlisted technologies from which he must choose. He consults a leading industrial pundit for his advice on multi-criteria decision-making techniques used by many practitioners in industry. They decide to use the analytic hierarchy process methodology, which had gained huge popularity among managers due to its simplicity and its ability to incorporate tangible and intangible factors alike. In training sessions involving managers with varied experiences across business processes such as manufacturing, quality, commercial, human resources and marketing, the three technologies were subjected to a close analysis and a decision was made about which one would best achieve the goal of expanded future growth for the company. See A case 9B14M068.
Namo Alloys, a medium-size, secondary-metal manufacturing firm, is seeking to expand by investing in new technology. The co-founder’s challenge is to select a technology that aligns with the company’s sustainable manufacturing philosophy by creating not only economic value but also sustainable societal and environmental values that will ensure triple bottom line value creation for all company stakeholders.
The founder of ServiceForce, a company that provides repair and maintenance for motorized two-wheel vehicles in India, has a dilemma about whether he should sell the rights of his franchisee business, join hands with a venture capitalist, borrow money for capacity building or see the business grow through franchising. The start-up was initiated with his own money and family investment. A mere 18 months has shown great success with two service stations, a mobile workshop to service rural and industrial clients and a system of card packages that allow customers to pre-pay for a range of services. The company is a recognized brand for customer satisfaction and quality workmanship, and the employees are happy and contribute to the company well-being by participating in customer promotion schemes. However, competition from both vehicle manufacturers’ service stations and unorganized garages is growing in tandem with the skyrocketing sales of two-wheel vehicles, especially to the younger demographic. In order to grow, the company is at a crossroads: should it borrow money to ramp up the growth of the business through new capacity building or invest in more franchises? Should the owner accept the offer to buy the franchise rights from him outright or the offer from a venture capitalist, which will result in losing some control?