個案總覽

The chief executive officer of Network for Information & Computer Technology (NICT), an information and communications technology implementation firm, had to consider a proposal from India Post in which the latter would leverage NICT’s franchisee-based last-mile customer service kiosks to offer banking solutions to rural areas in India. With the deal, the Post Bank of India would emerge as India’s largest commercial bank. NICT’s network of customer service kiosks was already used in a limited capacity by public-sector banks (the Bank of India and the State Bank of India). The India Post offer could stabilize the financial health of NICT and enable it to venture into new domains. However, its current partners might object to the relationship with India Post and withdraw from their partnership. While NICT had the competencies to serve its current clients, it would need to build new ones for India Post. The CEO had to choose between this emerging, possibly highly profitable opportunity and the existing but less profitable partners.

The chief executive officer of Network for Information & Computer Technology (NICT), an information and communications technology implementation firm, had to consider a proposal from India Post in which the latter would leverage NICT's franchisee-based last-mile customer service kiosks to offer banking solutions to rural areas in India. With the deal, the Post Bank of India would emerge as India's largest commercial bank. NICT's network of customer service kiosks was already used in a limited capacity by public-sector banks (the Bank of India and the State Bank of India). The India Post offer could stabilize the financial health of NICT and enable it to venture into new domains. However, its current partners might object to the relationship with India Post and withdraw from their partnership. While NICT had the competencies to serve its current clients, it would need to build new ones for India Post. The CEO had to choose between this emerging, possibly highly profitable opportunity and the existing but less profitable partners.

This case describes the restructuring initiatives undertaken at Gujarat State Road Transport Corporation (GSRTC) in India and the challenges faced by the managing director. As a consequence of partial deregulation, GSRTC faced mounting losses due to the activities of stage carriage and contract carriage operators from the private sector. The financial health of the corporation was further compromised by the state of Gujarat’s taxation policies and restrictions. The corporation faced a situation where it had a fleet of dated, fuel-inefficient buses prone to breakdowns, coupled with dwindling resources like bus drivers. <br><br>To break out of the vicious cycle, the managing director initiated a series of steps aimed at revitalizing GSRTC. His initiatives to obtain an operating profit and net profit were interpreted unsympathetically by the trade unions. They took a belligerent stand for wage revision and threatened service disruption. The disruption of an essential service guaranteed by the state eventually led to intervention by the state’s chief minister, in favour of wage revision. The additional wage burden frustrated projections for a possible turnaround. Given the further constraints and stretched resources, how would the managing director re-initiate change and restructure the organization?

This case describes the restructuring initiatives undertaken at Gujarat State Road Transport Corporation (GSRTC) and the impediments faced by the managing director. As a consequence of partial sectorial deregulation, GSRTC faced mounting losses due to the activities of stage carriage as well as contract carriage operators from the private sector. The financial health of the corporation was further compromised by the state's taxation policies and restrictions on acquisition of manpower and capital items. The corporation faced a situation where it had a fleet of over-aged, fuel inefficient buses prone to breakdowns, coupled with depleting relevant resources, such as bus drivers. To break out of the vicious downward cycle, the managing director initiated a series of steps aimed at revitalizing the corporation. His initiatives to obtain an operating profit and, then, a net profit were interpreted differently by the trade unions. They took a belligerent stand for wage revision and threatened service disruption. The disruption of an essential service guaranteed by the state eventually led to intervention by the state's chief minister in favour of wage revision. The additional wage burden made the projections for a possible turnaround go awry. Given the added constraints and a stretched resource position, how would the managing director re-initiate change and restructure the organization?