Wednesday, December 12, 2007
The Desi 'Umbrella' Business Model
An extremely surprising and novel facet of the bigwigs of India Inc. - the business model they follow. For starters, consider the Fortune 10:
- Wal Mart - United States (retail)
- ExxonMobil Corporation - United States (oil/retail)
- Royal Dutch Shell - Netherlands/United Kingdom (oil)
- BP - United Kingdom (oil)
- General Motors - United States (automobiles)
- Toyota Motor - Japan (automobiles)
- Chevron - United States (oil)
- DaimlerChrysler - Germany/United States (automobiles)
- ConocoPhillips - United States (oil)
- Total - France (oil)
Each of these behemoths is sector specific- oil, retail, automobiles...then moving on to others that populate the top 50, we have Banking (BOA, JPP Morgan, Morgan, ML), FMCG (P&G, Unilever) , Communication (AT&T, Verizon)- all sectors represented by their world leaders. Specialization is indeed a common thread running through global giants.
However, coming to the Indian market, we see a totally different ball game. The idea for every big desi company is to dabble in every possible sector- offer an umbrella- a wide range of products and services.
Take the Tata group- India's largest business entity with 96 companies under their fold- they have a mind boggling array of products and services. Many of the Tata group companies are household names by themselves, and frequently star in the headlines. Consider,
1. Steel (Tata Steel, Corus, the hue and cry surrounding Corus)
2. Power (Tata Power)
3. Retail (Westside, Trent)
3. Automobiles (Tata Motors, the world automobile market watches with bated breath as the 1 lac car story unfolds in India, as there is atalk of the Rover acquisition)
4. Telecom (Tata Indicom, the big spectrum battle raging in the telecom industry)
5. FMCG (Tata Salt, Tetley, second largest tea maker of the world)
6. Consulting (TCS, TSMG)
7. Insurance (Tata-AIG life insurance)
8. Software (Tata Elxsi)
9. Communication (Tata Sky)
10. Consumer Appliances (Voltas, Titan)
11. Hospitality (Taj group of Hotels, the Orient Express turning down Tata's bids)
12. Publishing (Tata McGraw Hill)
12. Tata Chemicals (Acquired British company Brunner Mond in '06)
10. Fundamental Research (Tata Institute of Fundamanetal Resesarch, CSR: Computational Research Lab)
All put together, the 28 publicly listed companies generate revenue of $22 billion (05-06). This would comfortably place the Tata Group in the Fortune 100 list. The variety is simply mind numbing. In each of the aforementioned sectors, Tata products are not just around to mark their presence but are thriving and are market leaders in many cases.
There is Wipro( FMCG- soap, talcum powders, IT) and there is ITC (cigarettes, packaged food, chips, Paper- Classmate range of notebooks, Hospitality, Clothing) and there is the comparatively low profile $ 2 Billion Murugappa group (Sanitaryware- Parryware, Cycles-TI cycles whose marquees include BSA and Hercules, Mutual Finds and Financial Services, Confectionary - Parry's) .
Is this 'umbrella' philosophy sustainable ? Will it lead to unsurmountable internal rifts and strains ? The Reliance split seems to suggest so, but as the India Inc. juggernaut rolls on seemingly inevitably, the umbrella model stands ratified. As a bystander, one is compelled to stop, stare and wonder.
However, coming to the Indian market, we see a totally different ball game. The idea for every big desi company is to dabble in every possible sector- offer an umbrella- a wide range of products and services.
Take the Tata group- India's largest business entity with 96 companies under their fold- they have a mind boggling array of products and services. Many of the Tata group companies are household names by themselves, and frequently star in the headlines. Consider,
1. Steel (Tata Steel, Corus, the hue and cry surrounding Corus)
2. Power (Tata Power)
3. Retail (Westside, Trent)
3. Automobiles (Tata Motors, the world automobile market watches with bated breath as the 1 lac car story unfolds in India, as there is atalk of the Rover acquisition)
4. Telecom (Tata Indicom, the big spectrum battle raging in the telecom industry)
5. FMCG (Tata Salt, Tetley, second largest tea maker of the world)
6. Consulting (TCS, TSMG)
7. Insurance (Tata-AIG life insurance)
8. Software (Tata Elxsi)
9. Communication (Tata Sky)
10. Consumer Appliances (Voltas, Titan)
11. Hospitality (Taj group of Hotels, the Orient Express turning down Tata's bids)
12. Publishing (Tata McGraw Hill)
12. Tata Chemicals (Acquired British company Brunner Mond in '06)
10. Fundamental Research (Tata Institute of Fundamanetal Resesarch, CSR: Computational Research Lab)
All put together, the 28 publicly listed companies generate revenue of $22 billion (05-06). This would comfortably place the Tata Group in the Fortune 100 list. The variety is simply mind numbing. In each of the aforementioned sectors, Tata products are not just around to mark their presence but are thriving and are market leaders in many cases.
There is Wipro( FMCG- soap, talcum powders, IT) and there is ITC (cigarettes, packaged food, chips, Paper- Classmate range of notebooks, Hospitality, Clothing) and there is the comparatively low profile $ 2 Billion Murugappa group (Sanitaryware- Parryware, Cycles-TI cycles whose marquees include BSA and Hercules, Mutual Finds and Financial Services, Confectionary - Parry's) .
Is this 'umbrella' philosophy sustainable ? Will it lead to unsurmountable internal rifts and strains ? The Reliance split seems to suggest so, but as the India Inc. juggernaut rolls on seemingly inevitably, the umbrella model stands ratified. As a bystander, one is compelled to stop, stare and wonder.
Labels: Musings
Tuesday, December 11, 2007
Rameez Raja's commentary
I will try not to be extremely vitriolic here, because I believe my sagacious comments on cricket do reach the highest echelons of the cricketing fraternity, and will be perused very soon by the subject of this post himself.
'The balls are not bouncing very much, and Kamran Akmal will have difficulty keeping them below his belt", remarked Mr. Ramiz Raja, former test cricketer and renowned commentator. Oh dear ! What a ridiculous blooper !
This is how Mr. Ramiz Raja proceeds to tear apart the respectable lexicon of the quirky and peppy cricket commentary. Mixing, with great zeal, high falutin words with the downright modest in one breath, corrupting ubiquitous English adages..this is one but one aspect of his commentary.
To add to his faults, his views are extremely partisan- looks at everything through green tinted Pakistani glasses ! Let's say Kumble's sends down a jaffa and rattles timber, shattering the defences of a bamboozled Younis Khan.
"Good Ball, but what was Younis thinking ! He ought to have stretched forward, and either taken it on his pads or tucked it away towards the vacant short leg region ! Poor batting ! "- Mr. Ramiz Raja's enlightening comments.
And take nit picking to further extremes, he needs a haricut badly. And he looks like that always.
The sonorous booming voice of Tony Greg, the endearing drawl of Boycott, the animated perkiness of Gavaskar, the grave authority of Shastri- now THAT is commentary, at it's very best.
'The balls are not bouncing very much, and Kamran Akmal will have difficulty keeping them below his belt", remarked Mr. Ramiz Raja, former test cricketer and renowned commentator. Oh dear ! What a ridiculous blooper !
This is how Mr. Ramiz Raja proceeds to tear apart the respectable lexicon of the quirky and peppy cricket commentary. Mixing, with great zeal, high falutin words with the downright modest in one breath, corrupting ubiquitous English adages..this is one but one aspect of his commentary.
To add to his faults, his views are extremely partisan- looks at everything through green tinted Pakistani glasses ! Let's say Kumble's sends down a jaffa and rattles timber, shattering the defences of a bamboozled Younis Khan.
"Good Ball, but what was Younis thinking ! He ought to have stretched forward, and either taken it on his pads or tucked it away towards the vacant short leg region ! Poor batting ! "- Mr. Ramiz Raja's enlightening comments.
And take nit picking to further extremes, he needs a haricut badly. And he looks like that always.
The sonorous booming voice of Tony Greg, the endearing drawl of Boycott, the animated perkiness of Gavaskar, the grave authority of Shastri- now THAT is commentary, at it's very best.
Labels: Esprit de sports
Subscribe to Posts [Atom]
