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NARSEE MONJEE INSTITUTE OF MANAGEMENT & HIGHER STUDIES

(Deemed University)

Department of Distance Learning

Course: PGDBM II, PGDMM II, PGDFM II, PGDHRM II Marks: 100

Subject: Business Strategy/Corporate Strategy Date: 17.05.2006

Time: 10.00 a.m. to 1.00 p.m.

Answer any five of the following questions

1. a) Explain the purpose of a mission statement.

b) Prepare a two-page typewritten mission statement for your company of your choice or for a business school.

c) List five potentially vulnerable areas of a firm without a stated

company mission.

2. Define the term social responsibility. Find an example of a company action that was legal but not socially responsible. Give a few Indian example of Indian Firms that have incorporated Social responsibility in their mission and vision statements.

3. What key emerging changes do you see in the global environment and

What are their implications for strategy?

Why do Company's diversify?

4. Explain the relevance and the implication of Porter's generic strategies and the five competitive forces. Can mass customization outdate his generic strategies on an industry widespread basis?

5. Why are Joint Ventures formed? Are they relevant in the current WTO

regime? What are the characteristics and strategic issues involved in JV's and why do they fail?

6. Describe the different types of co-operation strategies and illustrate each with

examples. Explain the utility of the SWOT exercise.

7. Write short notes on any 3 of the following:

1.Stakeholder expectations

2.The Value Chain

3.Franchising & Licensing

4.Core competency & sustained competitive advantage

5.Vision & Mission statements

Q 8 Case Study Asian Paints Ltd - The Indian Giant Success

Asian Paints has been the number one paints company in India since 1967. Today, from being the biggest manufacturer of paints, the company is moving towards greater focus on service. By 2005, the firm wants to be known as the global coating firm, with home decoration solutions. The three thrust areas it is covering in that direction are, its brand image and identity, its product portfolio, and its packaging innovations. Before understanding its new focus, it will be a good idea to see its financial picture, which is listed in Table C12.1

Table C12.1 The Financial Picture of Asian Paints Ltd

Figures in

crores of

rupees Sales Operating profits Interest Net Profit Loans Market cap

1998 950 131 20 68 193 1,252

1999 1,074 139 22 77 217 815

2000 1,312 191 20 97 174 1,705

2001 1,525 210 22 106 227 1,580

2002 1,656 238 15 115 111 2,106

Asian Paints is into solutions for painting homes, better than what has been done by local paint applicators.

BACKGROUND OF ASIAN PAINTS

Mr. Choksey, the father of Indian Paint industry, belonged to the laidback business community of India. Yet his vision was to 'See Indian homes painted in a variety of colours from a truly Indian company.'

His mission statement read 'To provide paints as per market demand, ensuring desired level and quality of customer (dealer) service, continued availability of the right product mix of right quality at the right time.'

With the near servile attitude of their dealers, MNCs took pride in serving metros and large cities through dealers who also supplied the products to semi-urban markets; however, they were concentrating on metros and found rural market non-existing. The business environment was hostile to the Indian paint industry, and more so to a new entrant.

Suppliers of raw materials were favoring MNCs because of their money power. MNCs kept the metros satisfied with their service. The goal of Asian paints was to set up manufacturing facility for a large variety of paints.