Based in India, Butterfly Edufields Pvt. Ltd. (BFF) designed, developed, assembled, and distributed educational activities and games for Grade 1–10 students to help them understand various science, technology, engineering, and mathematics (STEM) concepts. After more than a decade of existence, BFF had grown significantly in terms of production capacity, human resources, product portfolio, and geographical reach. Between 2010 and 2019, its revenues had grown 15 times. In November 2019, the company's chief executive officer faced three challenges: (1) the firm's inability to meet orders for newly introduced products; (2) its limited ability to tap and serve the huge market of 1.5 million schools across India; and (3) its failure to capture the enormous potential of selling educational toys online—a $300 million market. The chief executive officer believed that the traditional cost structure of centralized design, production, and distribution might not support the non-linear growth he envisaged for the company, so he had collected the value-added details for one of BFF's products with the intention of evaluating alternate value chain configurations for the company.
Orchid Chemicals & Pharmaceuticals Limited (Orchid) is an Indian pharmaceutical company, which commenced its operations in 1994. Over a span of 10 years, the turnover of this company has increased from US$11 million to US$153 million. The company's profit after tax registered a five fold increase from US$1.3 million to US$6.8 million in the corresponding period. Early success was a combination of pricing flexibility, lower production cost and business opportunities in unregulated markets. Orchid decided to explore opportunities for the manufacture of generic drugs in the regulated markets and formulations in the domestic market. Diversification to basic research was also considered. Cooperation and joint ventures were the primary route to expand and explore new molecule discovery. By 2005, Orchid was no longer a single-product company, its business had widened to multiple products in bulk, formulations and generics, in both regulated and unregulated markets. Orchid was making its presence felt in its novel drug delivery systems and new drug development processes. In 2005, Orchid faced several challenges related to financial leverage and risks, leadership, managerial challenges associated with joint ventures, balancing the new business model, setting global trends in being a pioneer in the industry, addressing shareholders' concerns and evolving an appropriate organization culture and process.