Company description
Indicoff Company is a global coffee company based in New Delhi, Indian that purchases and roasts high-quality whole bean coffee. The company is passionate purveyors of hot and cold coffee, in conjunction with everything that goes with a full and rewarding coffeehouse experience. The company aims to expand its stores and products to new markets in different countries and territories and compete with others coffeehouse globally. Indicoff will also sell pre-packed food items, cold and hot sandwiches and items such as tumblers and mugs. Many of the company’s products will be seasonally depending with the locality of the store. It aims to be competitive with other beverage companies such as Starbucks and India Coffee and Snacks.
Characteristics of global business
Indicoff aims to seek to enter international markets thereby it must have to possess key characteristics of successful global business. The company will be curious about other cultures and have strong stamina. The natural curiosity will enhance the company to gain a better understanding of customer needs and enhance engagement with local people on the discussion about their business culture and country (Guang & Trotter, 2012, p. 6458). The company will develop intuitive skills and sensitivity to local cultures, which will help Indicoff to be effective, and being aware of local customs, capability and trustworthy. The company will localize market knowledge to make it successful and bring services and products to market that meet the most significant and current needs of large and targeted customers.
Indicoff will consider the size of the business, and the company to be a global business must have bulk production and a substantial share in the global market. Consequently, the substance production is considerably taken care of by the supply channels. The company will also have a diversified field of activities. Diversification has become the order of the day in modern business since no company stick to one field of activity. Therefore, Indicoff will sell pre-packed food items and many related items. The company will involve itself in revolution in the field of science, which will bring tremendous effects on business. There will be a need of technology and current know how to make business more competitive.
Another characteristic is communication and information in the company that is making business, fast easy and fun in its operation. Indicoff and other companies must be ready to expect immediate returns the current day’s business aims in getting returns thereby earning back the investment in advance. The last pillar in characteristics of global business is competition. The world has turn to be competitive in business. Therefore, Indicoff must have strong stamina to establish a competitive environment for it to capture the market. The competition in business is advantageous to the consumer, because competition among business leads to better services, deals concerning superior commodities to consumers at a reasonable competitive price.
Initial planning
The initial step of the business strategy entails establishment of Mission, aims and objectives that will help the Indicoff Company identify the goals that it wants to achieve. The mission of the company identifies and reflects the core purpose of the business in India and different countries. Therefore, the company mission is to surpass the customers’ expectations in delivering high-quality coffee. The aim of the Indicoff aims is to offer support for the mission by ensuring that all stakeholders behave responsibly and offering customer satisfaction. The company objective entails acquiring 10% of the market share and expanding the business base globally for a span of 10 years. The company also engages in sustainability plans by aiming to reach 85 percent of the farmers and help them to mitigate the effect of climate change on the coffee plantations.
Market, country, legal and economic research
Market
The company targets the coffee consumers from India and other countries such as China, Palestine, South Africa, and Japan. Although the Café Coffee Day and the Starbucks dominate the India market, the company aims to acquire 20 percent of the local market and 10 percent of the global market by 2025.
Country
India offers an enabling environment due to its sign of political stability enhanced by the government lead by President Pranab Mukherjee and Prime Minister Narendra Modi. However, terrorists and poor relations challenge the country with its neighbors such as Pakistan. The conflict between the two countries is enhanced by the fighting over the claim of Kashmir, which is considered as one of the most militarized disputes in the region.
Legal landscape
The India legal system is a comprehensive system that contains taxation policies, which encourage the foreign direct investment. The judicial system is equitable, fair, and transparent and design. The legal system also provides intellectual property rights that strictly prohibit unethical business activities such as brand imitations. However, the country is ranked among the top countries that are challenged by activities such as corruption.
Economic factor
The Indian Economy is ranked position ten in the global economies. According to The Times of India, the India economy is likely to grow at an incredible rate of 9 percent, and achieve a GDP of $10 trillion economy by the year 2035. Currently, India has a GDP of $2.047 trillion and has the third largest GDP of $7.277 in terms of purchasing power parity. India exports include machinery, petroleum, steel and iron, chemicals, precious stones and automotive. The major export partners include the United States, United Arab Emirates (UAE), and China. On the other hand, the import commodities include precious stones, crude oil, fertilizer, chemicals, steel, and iron. The major import partners include China, Saudi Arabia, Germany, UAE, Singapore, and Germany. This indicates that the country has a supportive economic background for a wide range of businesses. In addition, the presence of direct foreign investments at local and international level indicated the country’s ability to support the global investments. The country is ranked position 24 for direct foreign investment at home and position 25 for direct foreign investment abroad.
Organization structure
The Indicoff organization structure is a traditional vertical structure where the employees work in different functional departments, and their responsibility are clearly defined. The chief executive or the president is the head of the company leadership and together with the board of director they set the corporate objectives. The other stakeholder in the organization structure involves human resources, production, and sales managers.
Hiring, production, management, and sales
Hiring
The hiring manager in the company entails in hiring qualified and competent employees that are ready to accomplish the objectives of the company. After the employees are offered a job and accepted in the company, they are required to report to the hiring manager.
Production
The production manager will be engaged in the controlling and coordinating all the activities that are required to produce quality coffee and other products. The work of the production manager typically engages to efficient control of scheduling, performance, waste, cost, and quality requirements. In other word, the production manager organizes the employment issues, finance, and business to make sure that the company satisfies all the stakeholders. The production manager ensures there are effectiveness and efficiency operations, sustainable and continuous improvement, and cost effectiveness by minimizing the overheads.
Management
The management coordinates and organizes all the business activities to help the company achieve substantial profit and accomplish its mission. The management enhances coordination between the managers such as production and hiring manager. The management formulates strategies such as differentiating themselves from the competitors in the market.
Sales
The sales department is concerned with the selling of the products and services produced by this company. The sales manager engages in activities such as marketing and promotion to ensure that the company has acquired a strong customer base and hence ability to increase sales. The sales manager also conducts the market research to determine the consumers’ preference ad tastes. The manager formulates the promotional strategies aiming to market the company’s product in and outside the India market.
Advantages, Challenges, Opportunities, and Threats
Indicoff Company will offer highest quality products that will give high significance to the quality of the company’s products. In addition, it also avoids standardization of their quality even for higher production output. Secondly, the location and aesthetic appeal of Indicoff stores will be in strategic and prime location in the New Delhi and across the countries that it will expand. Additionally, application of technology and mobile outlets will make significant growth of the company as it helps it in penetrating in new markets. The last strength will be highly qualified, skilled and experienced human resource management that will manage Indicoff Company.
Indicoff Company will meet challenges such as competition, which will cause self-cannibalization through overcrowding of similar companies. Additionally, the company will face weakness due to expensive products caused by products that Indicoff Company will offer. Political instability in India has caused the economic downturn this has lower the demand of the products hence depressing the income of the company. Generally, political instability is a challenge in all kinds of business.
Indicoff Company is a lucky business that will emerge in the current market where there are chances of expansion in new markets. The company will have growth potential in further expanding into developing and emerging markets. The company also will have opportunity to expand its retail operations in its products that will be offering to its customers. Additionally, the company will have the opportunity to advances in technology that will ease and increase the effectiveness of products process. Indicoff Company will have the opportunity to increase brand extension that will carry a powerful brand image of the company’s product.
The company will face external threats from its environment that will hinder its production growth. With that said, price volatility in the world coffee market will be the biggest threat since there is increased market saturation of coffee. The company will face fluctuation of foreign currency that makes saturation of foreign markets. These fluctuations are out of Indicoff controls. Since the company is global, it will face challenges from different cross-culture since tastes and lifestyle choices are different. Cross-cultural will influence the communication and success potential of competition (Guang & Trotter, 2012, p. 6457).
Recommendations
Start at the top.
The company must come up with comprehensive guidelines, goals, and objectives, and incorporate measures of political risks in the executive board levels. It is necessary to highlight the formal structure to be used for risk assessment; the structure will assist Indicoff to make wise decisions regarding their global strategies and operation. When this is put into consideration, the company will improve their status and increase their market penetration.
Manage political risk
The top management board must be charged with the responsibility to manage political risks. As observed, the political instability in India is a major setback to the company. In the process, performance will be increased. An analysis of the political environment pinpoints the opportunities and risks that affect the business. The Executive must always remain alert to notice the progress of the business.
Communicate political risk
A better communication structure will be imperative in assisting the company to optimize decision-making. The organization disseminates information to all stakeholders to enlighten them about the risks associated with all levels. The stakeholders will, therefore, make a better decision as the risks are analyzed. Sound decisions will be made, and this will decrease the uncertainties that arise in the business. The monitoring of political risks will assist the organization to protect all of its investments. Risk management will create awareness in all levels. The political environment will be analyzed, and this will support the undertaken operations in the company.
Risk assessment
It is wrong for a company to implement actions before assessing the risks associated with it. The assessment will deliver value to the organization if well conducted. The management must use conduct research to institute a balanced situation of the risks that affects the business. It is also important to apply scenario planning to understand the political outcomes that affect the company in terms of market entry, expansion, and exit decisions.
Growth and expansion
The company must allocate funds for its expansion in the global market. The opening of more stores and outlets will enable Indicoff to deliver its products to a large population. Consumers will purchase the coffee products when they are made available. Now, the organization has not succeeded to open multiple branches in various countries. The situation denies them a chance to penetrate in the global market at a faster rate than other competitors do. The expansion will be instrumental in creating awareness to the target market, and the popularity of the products will increase.
Strategies and competencies of an effective global business manager
The strategies and competencies of an effective global manager include open-mindedness and flexibility, honesty and integrity, ability to deal with complexity, cultural interest, and sensitivity, and stable personal life. An effective global manager must possess international knowledge to understand the socio-political and economic policies in different countries. The knowledge will help the manager to understand the market distribution networks thus making proper decisions. Technology savvy is another important element that a global manager must have. In the current world, technological advancements present the opportunity for companies to interact all across the globe. A global leader is capable of supervising all employees irrespective of their countries of origin. In addition, he is capable of developing a strategic business plan that fits the global market. In addition, he manages risks in the global platform in an easy manner.
References
Dong, K., & Liu, Y. (2010). Cross-cultural management in China. Cross Cultural Management: An International Journal. doi:10.1108/13527601011068333
Guang, T., & Trotter, D. (2012). Key issues in cross-cultural business communication:. Anthropological approaches to international business, 6(22), 6456-6464. Retrieved from http://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=4&cad=rja&uact=8&ved=0CDIQFjAD&url=http%3A%2F%2Fscholar.harvard.edu%2Ffiles%2Fnithingeereddy%2Ffiles%2Fstarbucks_case_analysis.pdf&ei=079zVJaTFZLfap_9gsAM&usg=AFQjCNF-_39fiMsI13pqsB5wanF6IWqwGw&sig2=8djfYd3q-CBiEKvw2OEidw&bvm=bv.80185997,d.d2s
Johnson, Robert D, and Robert A. Oberwise. Developing Global Leaders: A Guide to Managing Effectively in Unfamiliar Places. New York: Palgrave Macmillan, 2012. Print.
Srinivasan, T. N., & Wallack, J. S. (2009). What is Indian Political Economy of Economic Reform? Preliminary outline of project.
The Times of India. (2014, November 24). India can grow at 9%, become $10 trillion economy: PwC - The Times of India. Retrieved from http://timesofindia.indiatimes.com/business/india-business/India-can-grow-at-9-become-10-trillion-economy-PwC/articleshow/45260652.cms
