E globuzz vol ii issue i

0 | e - G l o b u z z , V o l I I I s s u e I J u l y - S e p t ‟ 1 1

i | e - G l o b u z z , V o l I I I s s u e I J u l y - S e p t ‟ 1 1

Foreword

Dear Readers,

We are pleased to present to you the 6th issue of e-Globuzz, the quarterly

e-periodical of International Business Society (IBS@SIMSR).

IBS@SIMSR is organizing the first International Business Conference on

Saturday 24th September, 2011. While the detailed program will be

communicated to you separately, please mark this important date in your

calendar and be there at this conference.

The features in this issue include coverage on the business leader Sir Richard Branson – CEO of UK

based Virgin group, country focus on Australia, sector focus on FMCG & alumni speak by Ms. Kirti

Shukla (PGPIB 2002-04) – Manager – API Commercial Global Sourcing, Sandoz Pvt. Ltd. The

articles cover a wide range of International Business topics and current affairs.

During the last 2 months, IBS@SIMSR organized important interactions with two distinguished

experts – Mr. P. R. Dalal, Executive Director, EXIM Bank & Mr. K. C. P. Patnaik, Commissioner-

Income tax, Government of India. Both these interactions were highly rewarding and have been

covered under Events@IBS section of this issue.

Like in the previous issues, articles in this issue have been largely contributed by SIMSR students. It

has been our endeavor to have articles from SIMSR alumni, faculty and corporate executives from

leading companies engaged in International Business to give e-Globuzz a richer and broader

perspective.

We hope you like this issue of e-Globuzz. Look forward to meeting you at The First International

Business Conference on Saturday 24th September‟11.

Prof. C. P. Joshi

Faculty Mentor-IBS@SIMSR

Program Coordinator PGDM-IB

ii | e - G l o b u z z , V o l I I I s s u e I J u l y - S e p t ‟ 1 1

VOL II ISSUE I July – Sept ‘11

1 Company In Focus:

General Motors

3 Sector in Focus:

FMCG

7 Expert Talk:

Global Sourcing

10 Country in Focus:

Australia

13 International Finance:

External Commercial

Borrowing v/s Foreign

Institutional Investments

15 Challenges of

Communicating with a

Global Workforce

17 International Logistics

Factors and Trend Setters

19

Alumni Speak

21 International News

23 Business Leader

Sir Richard Branson

25 Events @ IBS

All the views expressed in this e-periodical reflect the personal opinions and views

of the authors and do not reflect IBS@SIMSR views.

Faculty Mentor

Prof. C. P. Joshi

Editors

Manvinder K Sodhi

Prerna Makhijani

Designers

Swetaleena Das

Vishu Kartik

Circulation

Pranshu Soni

Gurpreet Kaur


General Motors |Vaibhav Palaye (PGDM-IB 10-12)

Company Overview

General Motors is an omnipresent company

headquartered in Detroit, United States, a

company so essential to the overall health of

the U.S economy that it spawned the phrase

“As GM goes, so goes the nation”. Tracing its

roots back to 1908; GM currently employs

209,000 people in every major region of the

world. Long known for the manufacturing of

cars, trucks and automobiles, General Motors

has also been engaged in finance and

insurance. However, most recently the global

recession had a devastating impact on its cash

flows, financial conditions and operations. To

survive, the company had to accept a

government bailout plan.

Global Presence

GM does business in more than 120 countries.

It produces cars and trucks in 31 countries and

sells and services these vehicles in various

other countries. GM‟s largest national market

is China, followed by United States, Brazil,

United Kingdom, Germany, Canada and

Russia. General Motors truly has an

international presence with factories in Poland,

Russia, South Africa, Ecuador, Egypt,

Germany, Argentina, Australia, Belgium,

Brazil, China, Colombia, South Korea, Spain,

Sweden, Thailand and Vietnam. In addition, it

also has assembly, manufacturing, distribution,

offices and warehousing operations in 55 other

countries.

Company Financials

For the year ending 2010, GM‟s sales were to

the tune of $135, 592 million. On February 24,

2011, General Motors reported its first full-

year profit since 2004. It had an option of

carrying forward previous losses to reduce tax

liability on future earnings. It earned $4.7

billion in 2010. The Wall Street Journal

estimated the tax break, including credits for

costs related to pensions and other expenses

can be worth as much as $45 billion over the

next 20 years.

Brand Variety

GM and its strategic partners sell and service

its vehicles through the following brands

worldwide: Buick, Cadillac, Chevrolet, GMC,

Daewoo, Holden, Isuzu, Jiefang, Opel,

Vauxhall and Wuling.

Bankruptcy Period

GM faced one of its worst crises as a part of

the global financial meltdown in the year

2008-2010. It was weakened by a substantial

increase in the prices of automotive fuel,

linked to the 2003-2008 energy crisis which

discouraged purchases of sport utility vehicles

(SUVs) and pickup trucks which have low fuel

economy. The popularity and relatively high

profit margins of these vehicles had

encouraged General Motors to make them

their primary focus. With fewer fuel-efficient

models to offer to consumers, sales began to

slide. By 2008, the situation had turned critical

as the credit crunch placed pressure on the


prices of raw materials. Facing financial

losses, GM reduced its operations in many

factories and drastically reduced employment

levels. Eventually General Motors filed for

Chapter 11 bankruptcy protection as part of

the Obama administration‟s plan to shrink the

automaker to a sustainable size and give a

majority ownership stake to the federal

government.

Comeback after Bankruptcy

After the bankruptcy debacle which dented

GM‟s credibility to a great extent, the

company started working its way back. As part

of the company reorganization, the content and

the structure of its brand portfolio was

reorganized. Some nameplates like Pontiac,

Saturn, Hummer, and service brands like

Goodwrench were discontinued. Others, like

Saab, were sold. They streamlined the product

line to five brands. The U.S. government

infused $60 billion to make sure GM had the

resources to restructure in bankruptcy. With

financing partially provided by the US

Government, GM successfully restructured

its operations and finances with the

government bailout. Thanks to the

restructuring, GM in 2010 posted net profits

and positive cash flows. The company was

listed on major stock exchanges on November

18, 2010 with the world's largest IPO. The

money realized from the IPO was used to

payback US government. After the IPO, US

government's stake in the car maker has fallen

to about 40 per cent from its prior 61 per cent.

Future Outlook

General Motors will continue to recover

market share and aggressively promote the

launch of its extended-range electric vehicles.

The company will also continue to pay back

the government ahead of schedule. Although

bankruptcy eliminated much of the company's

debt, it is ignoring the company's massive

pension obligations. The huge pension liability

is a red flag and it may land General Motors in

trouble in future, if proper provision is not

made for the same. Thus, the road ahead is not

easy for GM but its CEO, „Ed Whitacre Jr‟

along with his team is confident of putting up

a good show in the future.

Did you know?

Andean Community

It is a South American forum of economic cooperation among Bolivia, Colombia, Ecuador and Venezuela. It was established in 1969 and it

works to bring Andean sub regional integration, promote external projection, and reinforce the actions connected with the process.


FMCG Sector in Emerging Economies| Mahesh Kulkarni (PGDM-IB 10-12)

Business landscape of FMCG sector is not

only expanding but also becoming more

competitive across the world over the last

decade. The sector is a part of the broad

classification called consumer goods in

international context, which includes

consumer durables, semi durables and

consumer packaged goods. In Indian scenario,

consumer packaged goods is popularly known

as fast moving consumer goods which majorly

includes Household care, Personal care, Foods

and Beverages.

There is a global economic imbalance between

western and eastern world. Traditionally

export dominated countries (like China, Japan,

and South Korea) have to focus on domestic

market instead of export market. Similarly

western countries should concentrate on export

led growth instead of focusing on depleting

domestic demand. Interest rates are becoming

relatively lower in developed economies (US,

UK) compared to emerging economies. This is

leading to increased outflow of capital to

developing economies, where there is a

surging demand especially in consumer goods

sector. On the other hand, this is leading to

inflationary pressure. Central banks are trying

to contain inflation rates by raising the interest

rates.

USA, which is considered to be the major

market of FMCG sector, had a negative

growth during the year 2009 due to recession

and in the last fiscal it has just reached a

positive figure of around 1%. The scenario in

other developed economies like Japan is also

not optimistic. Recent tsunami has caused a

short term jerk in Japan‟s economy. Total

spending in Japan grew at a compounded

annual growth rate of 1.4% over 2005-2010

and it is forecasted to remain at the same rate

over the period 20010-14. FMCG sector in

Middle East and African region has the future

potential for MNEs with a downside political

risk.

Source: AC Nielson

According to Nielsen, the growth in Europe is

also not encouraging; it ranged from 0.9 % in

Finland to 12.4 % in Turkey. Among the big

five economies, France topped the group with

2.7 % nominal growth, followed by Spain

(+2.4%) and the UK (+2.3%). Italy recoded

0% growth, while Germany declined 4%. The

Czech Republic and Slovakia continued to

recover after several challenging quarters.

Ireland, however, which had shown new signs

of life at the end of 2010, posted nominal

growth of just 1.2 % primarily due to rising

value growth. Irish consumers continue to be

quite pessimistic about the economy, the state

of their personal finances and job prospects.


Source: Nielson Retail Index

APAC region which consist of emerging

economies like Philippines, Vietnam and

Indonesia have showed a double digit growth.

The whole spectrum is led by China and India

where the volumes are large. Major global

FMCG companies have already realized the

Low penetration rates

Many of the FMCG product‟s penetration

rates are very low in emerging countries like

China, India, Indonesia, Malaysia and

Thailand, which acts as a significant driving

factor for attractiveness of FMCG sector. As

per data, India has the lowest penetration level

for products like Skincare, Shampoo and

Toothpaste, which makes it the most attractive

consumer good segment amongst all Asian

countries.

potential and are investing heavily in these

markets. Rising middle class and low

penetration rates of the FMCG products act as

the major driving factors for attractiveness of

FMCG sector and are discussed below.

Large populations and rising income levels

Emerging market countries especially China,

India and Indonesia have the largest

populations in Asia and their disposable

incomes will grow at the fastest rates in the

region. Middle class in these countries is

expected to grow at 11%, 19% and 15%

respectively over the next five years (CLSA-

Mr- Mrs-Asia-2010).

Per Capita Consumption in US $

Category/Country Skin Care Shampoo Toothpaste

China 3.2 1 0.5

Indonesia 0.8 1.1 1

India 0.3 0.3 0.4

Malaysia 7.4 2.7 2.9

Thailand 7.7 2.4 2

Source:MOSL

Per Capita Consumption in US $

Source: Motilal Oswal Securities Ltd.

“FMCG sector in India would

touch a market size between

Rs.4,000 to Rs.6,200 billion”


Indian Scenario

Indian FMCG sector is pegged at around $30

billion (in FY10). It is the fourth largest sector

in the economy and it constitutes 2.2 % of

India„s GDP. This sector has reported a steady

sale CAGR of 11.2% over FY00-10 and an

annual volume growth of 8.5% (AC Nielson).

As per a recent study conducted by Booz &

Company, FMCG sector is expected to grow

in the range of 12% to 17% up to 2020 and

would touch a market size of Rs.4,000 to

Rs.6,200 billion.

Source: AC Nielson, News articles

India’s Country Attractiveness

Increasing Young Population: India has a

population with a median age of 25 years

as compared to 43 in Japan and 36 in the

US. Along with a large population and

rapidly changing consumer preferences,

India has translated into a large market

opportunity for FMCG players. The youth

segment (10–24 years age group)

constitutes nearly 25 per cent of the

population and is of significant interest to

all FMCG companies (IBEF, Advantage

India FMCG, 2011).

Rise in Disposable Income: From the

current census it is found that India's per

capita income has either just about or will

soon cross the $1,000-mark (Times of

India). The precise timing matters less

than the implication of the achievement.

Currently, the average Indian spends about

48%, also the majority, of his total income

on groceries (40%) and personal care

products (8%).

Higher Penetration of the Rural

Population: For nearly half of the largest

FMCG categories, rural India now

contributes more to their growth than

urban. According to a McKinsey Global

Institute (MGI) study “The Rise of India‟s

Consumer Market”, the total consumption

in India is likely to quadruple making

India the fifth largest consumer market by

2025. Urban India will account for nearly

68 per cent of consumption growth while

rural consumption will grow by 32 per

cent by 2025.

Government Policies for developing

favorable business environment for FMCG

sector: India has enacted policies aimed at

attaining international competitiveness

through lifting of the quantitative

restrictions, reduced excise duties,

automatic foreign investment and food

laws resulting in an environment that

fosters growth. 100 per cent export

oriented units can be set up by government

approval and use of foreign brand names

is now freely permitted.

FDI Policy: Automatic investment

approval (including foreign technology

agreements within specified norms), up to

100 per cent foreign equity or 100 per cent

for NRI and Overseas Corporate Bodies

(OCBs) investment, is allowed for most of

the food processing sector except malted

food, alcoholic beverages and those

reserved for small scale industries (SSI).

24 per cent foreign equity is permitted in

the small-scale sector. Temporary

approvals for imports for test marketing

can also be obtained from the Director

General of Foreign Trade.

Intensifying Competition in FMCG

Industry

P&G launched Tide Naturals (mid/low

priced detergent), cut shampoo and

feminine hygiene prices by 15-20%,

reduced Mach3 prices by 40% and


launched Gillette Guard at Rs15. Olay

White (skin care) comes in a Rs15 sachet.

GSK launched instant noodles (Foodles),

an energy drink (Lucozade), a health

snack (Nutribar) and biscuits.

PepsiCo, Danone and Kellogg entered new

categories, often nurturing them from

scratch.

Kraft's entry could be a major

development as its portfolio will compete

with Britannia, Nestle and Amul.

Domestic players like Marico (functional

foods, hair oil), Dabur (skin care, CHD)

and Emami (hair color, personal care) are

entering new categories in search of

growth drivers.

Budget Impact on FMCG Sector

With higher disposable income in urban

households and a significant portion of the

union budget allocation towards the

development of the rural sector and rural

employment, the FMCG sector has a lot to

gain from Union Budget 2010-11.

Focus on rural lending and increase in

capital of rural banks will help farmers‟

access to cheap loans. Further, extension

of repayment of loan and concession for

timely repayment helps reduce the burden

on farmers.

Various schemes for rural development

will help improve the living standards in

the rural area and help provide better

access to the rural heartlands.

Readjustment of tax slabs will help

increase the disposable income in the

hands of consumers.

Concessional duties and exemption of

service tax will help boost setting up of

cold storages, cold units and refrigeration

units.

Reduction of excise duty on sanitary

napkins and diapers will help reduce

prices on these items.

Did you know?

Nordic Council

A regional alliance was established in 1952 among Norway, Sweden,

Finland, Denmark, and Iceland that is dedicated to cooperation among the

Nordic countries. This has led to a common labour market, social security, and

free movement of citizens across borders


Global Sourcing- Changing face of Globalization

|Corporate Article by Kirti Shukla,

Manager – API Commercial Global Sourcing,

Sandoz Pvt. Ltd.

I drive a Mercedes Benz wearing a Versace

jeans and Nike T-shirt, carrying an Apple

iPod, fiddling with my Blackberry, typing my

Facebook status

when signal turns

red. My Louis

Vuitton bag lies in

the back seat and I

head towards Hard

Rock Cafe looking

at my Rolex watch

just to check if I am not late, I guess I have

enough reason‟s to be called globalized in all

respects.

Well here „I‟ is not literally me

(unfortunately!) but a high end consumer in

India, China, USA or anywhere on this globe

and is connected to the world. The brands vary

based on purchasing power and preference, but

nonetheless massive consumerism is the new

mantra today.

Physical distances are no longer important

even for a seller, considering companies have

access to markets of countries far and wide. As

a company in business, I want to penetrate into

every market, deliver a high quality product

from which I derive maximum profit and

customer loyalty. If my location is hindering

my business model because of high overheads,

labor cost, inability to produce volumes etc.

and also as it‟s impossible for me to be

completely vertically integrated and make

everything which is used in my product; what

am I supposed to do? Search for suppliers who

can make my product/ part of the product/ give

me service/ develop technology overcoming

my limitations or just help me concentrate on

other factors thus helping me expand and be

profitable at business? It does not matter if the

supplier is in my country or in any other part

of the world. I source from you and sell to you

and yet make money, funny but true.

This gives us a kind of abutment to the basis

of Sourcing concept although this is not the

only factor. If we look back and see, the

process of globalization started with

developing countries exporting cheaper

products to developed nations where cost of

production had gone abnormally high due to

various factors. But over a period of time this

process has evolved into a much bigger

phenomenon called “Global Sourcing”. With

time and changing trends, world over

procurement or buying has become one of

those key elements that decide future

strategies and vision of all large cap and small

cap companies.

In simple terms, Global sourcing is no more

just an import / export business for companies

comprising of a small chunk of their business

initially; but has now actually evolved into a

much important sourcing tool that decides the

overall strategy for any organization that

wants to operate globally by either being

present in other countries or by simply

sourcing few products or services from best

available sources in different countries. As a

strategy it is helping companies in all

significant sectors to operate with lesser costs

and get best quality products /services.


The company outsources those manufacturing

resources and capabilities or

services where the suppliers

have a competitive

advantage, e.g. greater

scale, fundamentally lower

cost structure or stronger

performance incentives. It

uses outsourcing

proactively through a

stronger focus on the core

business areas as a way to

improve manufacturing performance, generate

employee commitment and consequently

increase competitiveness and profitability.

If we look at developing countries, they are

becoming more flexible in terms of their

export policies and benefits offered to

manufacturers to be a part of the global

market. Export oriented units, FTZs, DEPB

scheme, EPCG, deemed exports are all

incentives given to Indian manufactures by

government of India to help in exports.

Let‟s take a similar example, today if we shop

for souvenirs in USA or a similar tourist place

in Europe we can buy merchandise which

flaunt the name of country in which it was

purchased but as we read the small tags and

bar codes one can find out, „Made in India or

China‟ most of the time. The trend somehow

picked up in a big way from IT companies

which started sourcing software development

from low cost countries. Then the concept of

BPOs and KPOs was invented and is still

thriving. Today there is no limit as to what all

can be outsourced. Right from R&D

technologies to people and services,

everything today can be procured. In fact,

engineers from reputed institutes of India have

since long been the key outsourced human

resource for USA.

Majority of the

companies in all sectors

currently talk about the

concept of Low cost

country sourcing and

India and China remain to

be the biggest hub for

sourcing. Be it

pharmaceuticals, textile,

IT, automobiles,

consumer goods, toys, technologies, services,

R&D etc., everyone has geared up to

manufacture and supply to bigger business

giants. Contract manufacturing is a concept

mostly used by companies who wish to focus

on their branding and product portfolio.

Therefore they transfer technologies or ask the

smaller player to manufacture the product

itself for them. Another approach to this is

joining hands with local players who are

strategic suppliers. As the gates open for 51%

FDI in Indian retail sector we will for sure see

lots of mergers and joint ventures taking place.

Countries like China, India, South Korea and

Vietnam might be ranked higher on FDI

investments but countries like Hong Kong,

Singapore and Ireland are ranked much higher

for being more competitive in terms of ease of

doing business with these countries. These

countries have more relaxed policies for

foreign exchange regulation, taxation and

other government policies which facilitate

companies from other countries to carry out

their operations hassle-free. Competitiveness

on these grounds has helped countries like

Hong Kong to become a commercial hub and

a global destination for many companies.

But with each new change there comes some

challenges, which are to be dealt with the same

“With each new change there come some challenges,

which are to be dealt with same finesse as change itself.”


finesse as change itself. With each leap of

globalization and open economies, comes the

challenge of integrating these economies

seamlessly. Business carried out between two

companies situated in two different countries

has direct impact on their respective

economies. Since the quantum of business

carried out between most of the major

companies are of much larger size, it can have

a direct impact on the commercial setup of the

country in which that company operates. So in

this scenario where economies are open to

foreign players and huge transactions take

place across these countries, economies need

to be very well administered so as to avoid any

external influence affecting their overall well-

being. In recent past there have been many

countries which have been at the receiving end

of bad administration at home due to which

they had to face difficult situations. Hence

now companies are not only evaluating their

vendors‟ economic well-being but are also

evaluating the commercial, political and social

environment in which that company operates.

From fluctuating currencies, to changing

policies, natural calamities, political unrest and

even climatic conditions like bad monsoons or

floods effect the economy of a country,

making sourcing a tough activity.

All these factors need to be seriously

considered while drafting a sourcing strategy

for a broader timeframe. As sourcing is now

becoming the backbone of entire business

models there are various sourcing tools which

are designed and utilized by souring

professionals in order to make the business

plan. I'm sure with more companies and

countries open to source globally, it would

ensure that customers in each country

are benefitted and better served by the

strategies devised.

Of course everything has its own boons and

banes, Global sourcing too has lots of benefits

but a miscalculated step in this arena can lead

to huge business losses. Still, the concept has

already taken off in full swing and will sure be

increasing.


Australia|Kapil Jain (PGDM-IB 10-12)

Australia, officially known as Commonwealth

of Australia is an independent nation within

the Commonwealth. It is a country located in

the Southern Hemisphere which comprise the

mainland of the Australian continent, the

island of Tasmania and numerous smaller

islands in the Indian and Pacific Ocean. The

capital of Australia is Canberra, which is in the

Australian Capital

Territory (ACT).

History

The first inhabitants of

Australia were the

Aborigines, who

migrated there at least

40,000 years ago from

Southeast Asia. There

may have been between

half a million to one

million Aborigines at

the time of European settlement; today about

350,000 live in Australia. Australia is still part

of the British Commonwealth.

Society and Culture

Even today, Australia is heavily influenced by

its British and European origins. Although

Australia has no official language, English is

so entrenched that it has become the de facto

national language. Australia has no state

religion. Freedom of religion is protected

under Australian constitution with 19% of

population following no religion and the rest

follow mostly Christianity. All children

receive 11 years of compulsory education

from the age of 6 to 16 (class 1 to 10),

contributing to an adult literacy rate that is

assumed to be 99%. Culture has been strongly

influenced by the Anglo-Celtic western

culture.

Weather

Much of Australia has a continental climate.

The temperatures get hot during the day, and

then drop considerably at night. Australia is

also very arid and gets very little rain.

Political System

Australia is an

independent nation within

the Commonwealth

having Federal

Parliamentary Democracy.

Queen Elizabeth II of the

United Kingdom, the head

of the Commonwealth and

the hereditary monarch, is

the head of state and is

represented in Australia

by a governor-general.

The governor-general is appointed by the

monarch on the recommendation of the prime

minister and head of government. The

governor-general represents the monarch's

interests in Australia.

Currency

Australia has had a freely floating currency

since 1983. The Reserve Bank of Australia

(RBA) restricts its intervention in the currency

market to smoothing out short-term

disturbances, in the form of currency buying

and selling operations, rather than attempting

to fix the value of the Australian dollar or

offset underlying market trends.

Economy

Australia is the 13th largest economy in the

world according to nominal GDP (current

http://en.wikipedia.org/wiki/Southern_Hemisphere

http://en.wikipedia.org/wiki/Australia_(continent)

http://en.wikipedia.org/wiki/Tasmania

http://en.wikipedia.org/wiki/List_of_islands_of_Australia

http://en.wikipedia.org/wiki/List_of_islands_of_Australia

http://en.wikipedia.org/wiki/Indian_Ocean

http://en.wikipedia.org/wiki/Pacific_Ocean

http://en.wikipedia.org/wiki/State_religion

http://en.wikipedia.org/wiki/State_religion


prices) and the 17th largest according to GDP

(PPP). In the past two decades, Australia has

enjoyed a period of uninterrupted economic

growth – an average of 3.3% in real GDP

growth annually. In 2010, Australia‟s GDP

was distributed as follows – agriculture

(3.8%), industry (24.9%), services (71.3%).

As with most advanced economies, Australia

has a dynamic service sector. This includes

industries such as banking, insurance and

finance; the media and entertainment

industries; consulting, tourism and retail;

services provided by government, such as

education, health and welfare; and other

personal and business services. While the

service industry remains the backbone of

Australia‟s economy, Australia‟s mining

industry has been the catalyst for economic

growth in the past decade. Large quantities of

minerals and resources can be found in

Australia. Australia has the world‟s largest

resources of recoverable brown coal, lead,

zircon, nickel, tantalum, uranium and zinc, and

ranks second in the world for bauxite, copper,

gold and silver. Today, Australia is ranked

19th in the world for both imports and exports.

Foreign Relations

Along with their relationship with China,

Australia holds multiple free trade agreements

with numerous other countries such as the US,

Singapore, Chile and Thailand. However,

Australia‟s most notable trade partner is New

Zealand. The Australia New Zealand Closer

Economic Relations Trade Agreement

(ANZCERTA) has greatly integrated both

economies and there are now plans to create a

single Australasian economic market by 2015.

Australia is also member of numerous

organizations such as APEC, the G20, WTO

and OECD.

Time Zone Difference

Australia is 4.5 hours ahead of India.

Business Opportunity

Australia was ranked third in the 2011

Economic Freedom Index behind Hong

Kong and Singapore and continues to provide

an ideal environment for business.

Australian interest in India and Indian business

has phenomenally grown in the past few years.

Apart from the cost advantage, Australia's

extensive skill shortage has been the major

driver for many Australian companies seeking

products and services from India. In the past

two years, over fifty Indian companies have

also set up offices in Australia and are doing

business successfully.

The agriculture sector in India can capitalize

on the Australian post-harvest technology and

highly sophisticated farm management system

to bring down the

losses, which were 30% to 40 % and can

achieve self-sufficiency in the sector.

Huge potential for Indo-Australian

cooperation exists in infrastructure

development including roads, ports, airports

and railways; power sector; mining; oil and

natural gas including LNG; biotechnology;

drugs and pharmaceuticals; information

technology; water management, soil

conservation and waste disposal; food

processing and agribusiness; film and

television; processing of gems and jewelry;

tourism; and education.

http://www.economywatch.com/world_economy/australia/


India – Australia Relations

Both countries are members of the

Commonwealth, founder members of the

United Nations and members of the Indian

Ocean Rim – Association for Regional

Cooperation (IOR-ARC), ASEAN Regional

Forum (ARF) and dialogue partners with

ASEAN.

They both have a free press and an

independent judicial system; the English

language is an important link. Cricket is a

significant element in awareness at the popular

level.

Australia is India's ninth largest source of

imports. Over the past five years, India has

been the fastest growing market for Australian

exports. Investments have been growing

rapidly with Australia represented through an

increasing Australian company presence on

the ground in India, and with increasing

investment by Indian companies in Australia,

in particular in the resources, IT,

infrastructure, manufacturing, financial

services, biotechnology, clean energy, tourism

and hospitality sectors.

Some of the Australian companies operating in

India are Cartridge World, INCITE Group,

MyFactroy India , Pitcher Partners while some

of Indian companies in Australia are Aditya

Birla Group, Lanco Infratech Ltd, A.V.

Thomas & Co. Ltd, Adani group, Infosys, Tata

consulting, Satyam.

Australia mainly exports mined and

agricultural goods to India, while India's chief

exports are pearls, precious and semi-precious

stones, textiles and clothing. Over 97,000

Indian students enrolled in Australia in 2008,

representing an education export of a$2

billion. But, in 2009-10 attacks on Indian

students strained the relations between the two

nations. The full potential of Indo-Australian

trade and economic relations has not been

realized and there are considerable

opportunities towards their consolidation.

Road ahead

The opportunities in Australia are diverse

across multiple industry sectors including long

established resource and commodity sectors,

as well as relatively recent interest and activity

within the services sectors.

Australia and India have been working to

develop a bilateral free trade agreement

focusing on areas of complementarities and

working to find balance in areas to be further

developed. A feasibility study has been

completed for the Free Trade Agreement.

Going forward Australia is well positioned to

complement India‟s strong economic growth.


External Commercial Borrowing v/s Foreign Institutional Investment

|Ajit Kumar (PGDM-IB 10-12)

External Commercial Borrowings (ECB)

refers to commercial loans in the form of bank

loans, buyers‟ credit, suppliers‟ credit,

securitized instruments (e.g. floating rate notes

and fixed rate bonds) availed from non-

resident lenders with minimum average

maturity of three years. Foreign Currency

Convertible Bonds (FCCBs) is an ECB

instrument in which a bond issued by an

Indian company is expressed in foreign

currency, and the principal and interest in

respect of which is payable in foreign

currency.

The recent defaults by a number of Indian

companies (especially in the mid-cap segment,

where fewer refinancing avenues are

available), raise the question whether ECB is a

prudent source of financing for the Indian

corporate. Through the ECB route, Indian

corporates can raise foreign currency at a

much lower rate but are exposed to unlimited

currency risk if they keep their position

vulnerable. However, a fully hedged position

will cease to have advantage of the interest

rate differential.

Currently, an eligible borrower can access

ECB under two routes, Automatic route and

Approval route. The maximum amount of

ECB that can be raised by an eligible borrower

under the Automatic Route during one

financial year is USD 500 million and the

minimum maturity period should be three

years. Under the Approval route, an additional

of USD 250 million can be raised for a

minimum of ten years maturity.

Although, ECB is a wildly popular means for

raising funds by the Indian corporate at an

inexpensive rate, the problem with ECB is that

the borrower either carries a high currency risk

or bears the cost of the hedging.

The other alternative for raising funds by

Indian corporate from foreign investors is to

allow foreign investors to subscribe to the

bonds issued by Indian corporate in rupee

denomination. The investor will subscribe to

Indian corporate and government bond and

can earn a higher rate of return, but at the same

time, the foreign investors rather than the

Indian borrowers will be exposed to the

currency risk.

Keeping the above point in mind, the FII limit

for investment in corporate bonds has been

raised to USD 40 billion from USD 20 billion,

as suggested by finance ministry in the 2011

annual budget.

To attract FIIs to invest in Indian bonds, it‟s

imperative to develop an efficient secondary

bond market in India which is currently

lacking. The twelfth Five-Year Plan (2012-

2017) estimates an infrastructure spending of

USD 1 trillion. The planning commission

estimates that there is a gap of $100 billion

that needs to be bridged from foreign sources.

Hence development of a competitive bond

“Development to a competitive bond market is

essential for infrastructure development in India”


market is essential for infrastructure

development in India, which in turn is

essential for sustaining a high GDP growth for

a longer period of time.

Although the investments in the infrastructure

bonds will have a lock-in period of 5 years,

but raising the FII limits in corporate bond

market is a welcoming step towards market

development.

The recent introduction of Credit Default

Swaps or CDS products to cover the credit risk

for corporate bonds is yet another positive

move in this direction. CDS would further

increase investor‟s interest in corporate bonds

and would be beneficial for the development

of the corporate bond market in India.

Currently, the total outstanding corporate

bonds is just about INR 8 lac crore (or ~15%

of GDP) vis-à-vis INR 22.5 lac crore (or ~40%

of GDP) of government securities. Compare

this data with other countries, where the

outstanding corporate bonds accounts for 61%

of GDP in Korea and 37.5% of GDP in

Malaysia. India's corporate bond market, about

30% the size of China's, is failing to expand at

the rate analysts say is needed for the

government to meet its target of building

infrastructure.

To conclude, it could be said that much more

has to be done. Financial reforms like raising

the Foreign Institutional Investment caps and

introducing CDS are just a few initiatives in

that direction.

__________________________________________________________

__________________________________


Challenges of Communicating with a Global Workforce

|Sushma C S (PGDM–HR 10-12)

Globalization and its effects on the corporate

business have changed the relationship

between employer and employee.

The traditional relationship has ended due to

changes in management practices which are

driven by changes in the environment of the

business. Any kind of organizational change-

from introduction of new workforce program

to a change in business strategy like a merger

or acquisition requires effective

communication and trickling down of

information from the top level to the lower

rungs of employees. With the advent of

technology one can see the changes in every

sector of management. Although

communication has penetrated several levels

due to the use of internet and people

perpetually being online, it is still a topic of

concern not just for the Human Resources

Department, but also for the senior

management.

With the rise of global economy and spread of

businesses around the world, teams and

managers need to communicate around the

world and not just around the corner. Around

70% of the global workforces are knowledge

workers and they need to be sustained to have

a competitive edge. The organizations face

challenges in terms of linguistic, cultural,

religious, social and time-zone differences

among the global workforce. They can surpass

this challenge only by adopting new

approaches for communicating with the global

workforce. Creating an alignment of corporate

goals and values become tougher when it has

to be done across cultures and borders. It will

have to be kept in mind that failure of

communication strategy will have a

catastrophic effect on the business outcome.

With the bar of proficiency rising, the

employees need to be trained adequately to

take on the challenges of working in a

distributed environment. English might prove

to be helpful while dealing with clients and

customers in the USA and other English-

speaking nations. The same skill fails to

impress when it comes to European nations.

Training in other languages becomes a

challenge to aid the employee and facilitate

him to handle meetings or unexpected matters

with confidence. Recruitment for a global

workforce also entails a similar challenge

where segmenting the targets into clusters and

tailoring the communication for each specific

group needs to be taken care of.

The HR department comes into focus for the

development of a framework or strategy to

ensure communication in a global scenario.

Reinforcing the business strategies, policies

and procedures is required in order to drive the

message to a global workforce. But it should

be made sure that these are in sync with the

culture of the workplace and does not hurt any

religious or traditional sentiments. Bringing all

the departments and support staff on the same

page becomes necessary in order to achieve

the goals. The local business heads and the HR

teams should be actively involved so that they

can completely understand the business


messages and effectively relay it to their local

colleagues. They can also help in maintaining

the consistency of the messages that leave the

head office and reach the regional offices.

One of the issues that keep re-surfacing in

every business is that of engaging the

employees for better productivity. Employee

engagement in a global workforce attains

greater importance because it becomes

necessary to work in sync with employees

spread across the world. An engaging

workforce not only increases the bottom-line,

but it also helps in better retention of high-

performing employees. Hence, effective

communication gets to make or

break the situation. Aligning the

communication strategy with the

objectives of the organization

becomes a priority task for the

management. Communication is

one of the drivers of employee

engagement and if done

effectively, it can work wonders

for the organization. With better

leadership interaction, which includes CEO

visits to various business units across the

globe, the organization can hope to have an

engaging workforce which is committed to the

organization. But engaging a global workforce

entails many challenges. Employee

engagement programs that work for one set of

employees in a country might prove to be

useless with employees of another country. It

requires thorough research into the cultural

and geographical details of each region to

know the employees. Things that motivate

employees in India who are collectivistic in

nature will be different to those in the USA

who are individualistic in nature. The

dependency of employee engagement on

culture needs has to be driven home by the

management in order to succeed in retaining

employees. Communication across the

business units and departments makes the

situation much more complex for the

management. Technology plays an inevitable

role when it comes to communication across

boundaries. Although technology has helped

to reduce the impact of time-zone differences,

it greatly depends on the infrastructure

available at the various offices. Efficient

infrastructure needs to be built in order to

make the maximum use of technology for

communication. The future-looking managers

usually take full advantage of today‟s

technologies in order to conquer the language

and culture barrier. Innovations in technology

have facilitated the ability to offshore many

back-offices and call center services. Though

this resulted in reduction of operating

expenses, it has given rise to the necessity to

train employees in various culture-

related soft skills to cater a varied

customer base.

In an international business

scenario, virtual teams have

become a norm and communicating

with them is a challenging aspect

of the business. A standard format

for communication helps to negate

the absence of physical contact. Effective

implementation of all these approaches

depends on training, acceptance of protocols

and the personal initiative taken by employees

to make it a success. The global workforce is

expanding and re-shaping every moment, thus

emphasizing the importance and participation

of management in effective communication.

Consistent transfer of knowledge, expertise

and critical capabilities is the most important

factor for the success of an MNC. HR

becomes the key resource for transferring

these capabilities across the business units.

Sourcing of right people to fill overseas

positions, effective reporting systems for

international assignments and preservation of

both explicit and tacit knowledge will make

the task easier.

Ultimately, the most successful companies in

the world of business will be the one who can

recognize the primary importance of effective

communication in a workforce.


INTERNATIONAL LOGISTICS – FACTORS AND TREND SETTERS

| M Iqbal (PGDM–IB 10-12)

Introduction

Globalization paved way for a myriad of

companies opening up in their foreign outlook.

The aftermath of the culmination of the

Industrial Revolution witnessed large-scale

production of commodities and services. Many

developed nations produced surplus quantities

thereby creating friction in demand. However

advancement in technology (particularly

transportation) and communication enabled

what is called Globalization, a breakthrough

phenomenon that broadened the horizons of

hundreds of thousands of firms. Initially

Foreign Trade was seen as a potential

competitive edge for companies, which later

transpired to be just another feather in the hat

of companies, which now is just an order-

qualifying feature of companies. Every other

company nowadays is interested in the

overseas.

Subsequently, logistics and logistics firms are

in the limelight, focus on them is gradually

increasing when considering the best

practicable business options. Another

significant merit of the logistics industry (or in

that case any service industry) is that the

inventory like trucks, carriers, containers etc.

(if owned) is a major asset that depreciates

insignificantly over time, revenues are

consistent, and demand fluctuations are

relatively less. In the long run at least, this area

promises decent enough prosperity, if

established well. European Union, U.S and

China have the highest money in foreign trade,

with $320 billion, $240 billion and $220

billion respectively. There are 17 logistics

companies in the Fortune 500, a tremendous

increase from 7 a decade earlier. Some at the

top are C.H. Robinson Worldwide, Con-way,

Alexander and Baldwin, Hub Group etc.

Among the Indian top feature TNT Express,

AFL, Gati, Safexpress, Ashok Leyland etc.

Theory

When we talk about logistics or supply chains,

we ought to know the two basic types of

supply chain models- Responsive and Efficient

supply chains. Responsive type generally

caters to the innovative products like jewelry,

computer hardware, laptops, sanitary ware etc.

that have strict delivery timelines. In this case,

cost, optimization of resources like labour and

transport overheads and route-economics are

trade-offs. Efficient supply chain type on the

other hand has opposite features. Delivery

timelines are relaxed but efficiency in the

supply chain in terms of cost, labor and other

resources is vital. Examples are fundamental

commodities like food items having long

shelf-life, almost all FMCG products,

electronics (not on order) etc. Most of the top

end logistics companies have tactically come

up with an integration of both types and have

done wonders. Such companies manage to

provide solutions to any and every logistics

issue in the country. They are better explained

in terms of another type of supply chain- a

flexible one.

In a nutshell, deciding the best in the logistics

industry is however an exacting pursuit. It


depends on the products to be transported.

There are several parameters on which

companies can be evaluated on, like

infrastructure of the company, providing end-

to-end solution, type of supply chain

(responsive or efficient), niche, prominence

and growth etc. However, as argued by

Malcolm Gladwell in his book „Blink‟, a „thin-

slicing‟ approach by narrowing down the

parameters to a suitable and optimum filter

based on the concerned interests would rather

make decision-making easier.

Trend Setter 1: Ashok-Leyland

Ashok Leyland pulled in an 89% increase in

the net profits and 72% increase in the

revenues. Ashok Leyland is related to logistics

as being a major player in the transportation of

army equipment and military artillery for the

Indian Army. Serving as a co-chairman for

years for Ashok Leyland, Mr. Hinduja had put

in tireless efforts in founding a long-term

relationship with the Indian Army, which bore

fruit finally. A couple of years ago, Ashok

Leyland went into a common venture with

Japanese auto giant Nissan Motors which will

share a common manufacturing facility in

Chennai. With this, Ashok Leyland

metamorphosed into a powerhouse of vehicle

production with more than 75,000 vehicles

produced yearly. This enabled it to flourish in

the logistics industry. The Comet 1611 truck

largely serves the logistics requirements.

Ashok Leyland is an example of an Indian

company setting world-class standards and

leveraging itself to justify its status quo.

Trend Setter 2: Con-way, Inc

The International Freight and Logistics giant

Con-way Inc. is again an inspiration, with

400,000 customers and about 30,000

employees, specialized in LTL (less-than-

truckload) to full truckload and truck

brokerage. The strength of Con-way reflects in

the dominant share of freight and

transportation services on the U.S-Mexico

route. They also provide a wide range of order

winning innovative solutions to business

strategies, accelerated order cycle times, tight

supply-chain-control, reduced costs, improved

inventory fulfillment etc. They have employed

the global 3PL solutions that address the most

complex supply chain challenges. This is their

competency and they justify it by excelling in

executing their strengths. Lean logistics with

emphasis on mistake proofing and reducing

and route-overlap has been their key area of

proficiency. Con-way is an example of

consistent change-adapting firm, precisely the

flexible approach that we discussed earlier in

this passage.

Final word

Supply Chain management has taken a totally

novel stance in the recent years with the

advent of technological procedures of tracking

and GPS. Internationally, if one is looking at

making a mark, latest practices need to be

deployed on the logistics front. Optimization is

a result of a real-time visibility into the supply

and delivery chain. The „one-size-fits-all‟

approach is getting more and more obsolete

and uneconomical. International companies

are seeking a keenly tailor-made process for

every business situation, simultaneously

leveraging a legacy of supply chain experience

and a deep bench of technology innovators.


Alumni Speak!!! |Editor: Atul Sinha (PGDM-IB 10-12)

Ms. Kirti Shukla, alumnus of PGPIB (2002-

04), is currently Manager-API Commercial

Global Sourcing at Sandoz Pvt. Ltd. She has

also worked with Torrent Pharmaceuticals as

Assistant Manager (2004-2006). Post-

graduation in International Business led her to

start her career in international marketing

involving global markets.

Following is the excerpt from an interview

with her.

What were your expectations when you

joined PGPIB at SIMSR in 2002?

The maximum percentage of students pursuing

MBA aspires to be well placed, I was no

different. Yes, a course in IB somehow gave

wings to my dreams of getting a job which

takes me across the world. PGPIB was a very

young course when I joined and we were just

the 3rd batch. Being a fresher, just out of

college, I was naïve to the corporate world and

for me SIMSR was an institute which I hoped

would help me learn basic concepts and pre-

requisites of business & for sure get me a job.

Today I can proudly & happily say that being

in IB was one of the best things that happened

to me. Even though the course was new, the

faculty was excellent & they guided us to the

direction of forming a plinth strong enough to

build our futures in the competitive corporate

world. I am still new to the industry & there is

a long road ahead where I aspire to walk & run

but never stop and for me the wheels which

are and shall take me ahead are my basics &

concepts learnt at SIMSR.

Over the last seven years how have you

leveraged your learning pertaining to IB?

For two years we learnt concepts in

international markets, cultures, business

requirements, policies, documentation,

strategies and much more. I was lucky to get a

campus placement & started with International

marketing in pharmaceutical industry. So,

what all I learnt, I got a chance to relate from

day one of my job.

Of course in the beginning you need time to fit

in the system and actually contribute but the

background is what helps to excel. Switching

from Torrent Pharmaceuticals to Sandoz Pvt.

Ltd was convenient because the profile of

global sourcing here required a person who

knew International Business and had worked

in international markets. I had both, thanks to

PGPIB & SIMSR.

Today in global sourcing, I am responsible for

strategic sourcing and my understanding of the

export policies, export terms and shipping

procedures gives me added advantage in

negotiating with vendors & making relevant

source plans for the business. The case studies

& projects we did during the course on

cultural attributes, international markets &

global issues helped me picking up the global

business faster and today when I travel across

the globe & interact with stakeholders of my

project, who sit in various countries of the

world, I feel it‟s easier because of my IB

background.

I think what helped the most in moving my

career was recognition which I carry being a


student of SIMSR and the IB course that was a

step to catch up the escalator of international

business. I still have lots to learn but I feel

confident that my learning and my attitude will

help me achieve my objectives.

What do feel you should be the capabilities

and skills PGDM (IB) students should

develop while at SIMSR?

Education at a management college is all about

concepts & application. Read! That‟s the buzz

word for everyone - journals, business

magazines, articles on international markets,

countries, current issues, biographies of

entrepreneurs are a great source of learning.

Also, stay positive and try to get less

distracted. Don‟t just stick to the college

assignments, try and solve case studies

available on various websites and magazines,

make your own groups and discuss them.

When applying for jobs try and focus on

profiles being offered. Developing something

what you have is easier rather than starting

from scratch, hence don‟t rush or panic if you

find difficult changing your sector or your

package is not great, see what comes your way

and how best you can shape out of it.

I believe, getting a job is easier but sustaining

it & growing in it is what needs efforts. So the

first job you get is not the end but the

beginning and from there how you mould your

career is all up to you.


International News |James Ganesh (PGDM-IB 10-12)

Many important events took place in Africa in

the last one year from unrest in Egypt to

Libya`s demand for a separate nation, South

Sudan which was recently formed from Sudan.

South Sudan got independence on July 9, 2011

following nearly 50 years of war with Sudan

and millions of deaths. Independence for

South Sudan was declared six years after it

signed a peace agreement in 2005 to end a

decade-long war with Sudan. Abyei is very

rich in oil resources and thus is the

controversial region between Sudan and South

Sudan; it is still not decided to which country

the Abyei region belongs. It is already

reiterated by Omer Al-Bashir of Sudan that

any attempt by the new state in South Sudan to

impose a unilateral reality in the hotly-

contested region Abyei could potentially lead

to a war with the South.

Official language of the country is English as

it is one of the largest spoken international

language and official language in many

countries including India.

Sudan has planned to join the East Africa

league and India is also planning to have an

agreement with East African countries. South

Sudan is very rich in oil resources and

agriculture. Indians and Chinese firms have

already invested a lot in African markets.

However, the Indian companies are spending a

lot on training local people than their Chinese

counterparts. Notably Chinese and Indian

firms are operating in African continent with

different business strategies.

A report by the Norwegian People's Aid shows

foreign and domestic companies have acquired

large amount of rural land through leases with

communities and government institutions, at

least a tenth of Southern Sudan. Security

analysts and humanitarian organizations

warned that even as reconstruction gains a

footing, this is exposing the country to

possible food problems and conflicts in the

coming years. Over the past four years, foreign

interests sought or acquired 2.64 million

hectares (26,400 sq. km) in the agriculture,

forestry and bio fuel sectors alone; an area that

is larger than the whole of Rwanda. As per

World Bank`s report, Africa‟s population is

expected to reach 1.4 billion by 2025 and most

of the arable land in Africa is already leased to

multibillionaires all over the world.

Now the point is that how the African

countries‟ government will put some polices to

develop the people of the country rather than

feeding world population at the expense of its

own people. MNEs need a close watch on the

policies especially distributive risk in the

African countries. But chances of a

catastrophic political risk are less as African

countries started giving importance to

international relations and trade.

http://www.sudantribune.com/+-Omar-Hassan-al-Bashir,126-+

http://www.sudantribune.com/+-South-Sudan,036-+


MNEs operating in Africa must have a holistic

approach in conducting business and must

include local people in the operation of the

business and should concentrate more on

training and developing the local community

to have long term presence in African

countries.

_________________________________________________________________________________

“South Sudan gained independence from Sudan as an outcome of a peace

deal that ended Africa's longest-running civil war”

Did you know?

Bretton Woods Agreement

An agreement among IMF countries to promote exchange-rate stability and to facilitate the international flow of currencies

Calvo Doctrine

A foreign policy doctrine that states that the country in which an investment is located has jurisdiction over that investment disputes if any arising with foreign currency are required to be resolved in national courts under national government.


Sir Richard Branson

|Swati Moolchandani, Swetaleena Das (PGDM–IB 11-13)

A billionaire businessman, Sir Richard

Branson is the founder and CEO of the mega-

corporation known as the Virgin Group.

Branson is a harbinger of the Virgin publicity

machine and has made himself one of the best-

known businessmen around the world.

Richard Branson was born on July 18, 1950, in

Blackheath, London. Branson was educated at

Scaitcliffe School (now Bishopsgate School)

until the age of thirteen. He then attended

Stowe School until the age of sixteen.

Although he had suffered from dyslexia since

an early age but that did not come in his way

to showcase his ability to connect with people.

While in school, he scored terribly in IQ tests

and memorizing words were a nightmare for

him. Frustrated with the rigidity of school

rules and regulations, and seeing the energy of

student activism in the late 60's, he decided to

start his own student newspaper and it was an

overnight success. This was the stepping stone

in his entrepreneurial journey.

Richard Branson has created one of the most

recognizable brands in the world. In Britain

where he focuses much of his attention,

Branson has managed to "Virginize" a very

wide range of products and services. The

variety of business includes Virgin Atlantic,

Virgin Megastores, Virgin Books, Virgin

Credit Card, Virgin Holidays, Virgin

Trains, V2 Music, Virgin Active and Virgin

Galactic.

There are plenty more businesses that wear the

Virgin name throughout the world and there

will probably be more to come as Branson is

always looking for an interesting business to

start. One important element in Branson's

success is his belief in delegation. His Virgin

record company, now divested, was a perfect

example of how he organizes his many

ventures.

Branson is also inclined towards philanthropy

and various initiatives taken by him are a

testimony to it. He's pledged the next ten years

of profits from his transportation empire (an

amount expected to reach $3 billion) to the

development of renewable alternatives to

carbon fuels. Another initiative of his is called

“Virgin Group is an organization driven on informality

and information, one that is bottom heavy rather than

strangled by top level management.”

http://en.wikipedia.org/wiki/Blackheath,_London

http://en.wikipedia.org/wiki/Bishopsgate_School

http://en.wikipedia.org/wiki/Stowe_School


the Virgin Earth Challenge, where a cash

award of $25 million prize goes to the

individual who comes up with an

economically viable solution to the greenhouse

gas problem.

Branson is also known for his unique character

and leadership styles, one who is not afraid to

take risks, and believes that people are the

foundation to company's success. He is truly

of the people, by the people, for the people-

showing traits of a democratic leader. He

carries a notebook in his pocket all the time

just in case he hears something interesting

from people that he interacts with on any level

be it an employee, friend, business partner or a

complete stranger. He feels that good ideas

can come from anywhere and anytime. He has

said before, however, in spite of the above

facts, he always maintained the authority to

take top decisions which involved high risk

and long term impact. He also stresses on the

importance of being a regular guy and making

your employees feel important. He feels that

praise goes much farther than criticism and he

likes to make sure his people that work with

him are taken care of. One example of this was

when he won a lawsuit against British Airlines

and was awarded $500,000 he divided the

compensation amongst his staff.

Richard Branson has also pen down his

thoughts and life experiences in books. Some

of his best books include “The Adventure of

Business”, “Branson on Branson”,

“Losing My Virginity: How I've Survived,

Had Fun” and “Made a Fortune Doing

Business My Way” to name a few.

During his career his efforts have been

recognized and awarded. He has been

felicitated with esteemed awards like an

honorary degree of Doctor of Technology

from Loughborough University in 1993.

Branson was awarded with the Knighthood in

1999 for his contribution to entrepreneurship.

In January 2011 Branson was also awarded the

German Media Prize (organized by "Media

Control Charts"), previously handed to former

U.S. president Bill Clinton and the Dalai

Lama.

Branson is full of passion and believes in

living life to the fullest. Since 1985 he has

been getting his adrenaline rushes through

world record breaking attempts by boat and

hot air balloon. Several distance and speed

records have been attempted and achieved, but

his attempt to be the first person to

circumnavigate the world in a hot air balloon

was never achieved. Branson makes each

record attempt a media event with his Virgin

logo prominently displayed during every

launch, which has been an excellent source of

free advertising and brand placement for

Virgin.

"Sometimes I do wake up in the mornings

and feel like I've just had the most incredible

dream. I've just dreamt my life."- Richard

Branson

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http://www.virginearth.com/

http://www.bookfinder.com/dir/i/Losing_My_Virginity-How_Ive_Survived,_Had_Fun,_and_Made_a_Fortune_Doing/0812932293/



http://en.wikipedia.org/wiki/Doctor_of_Technology

http://en.wikipedia.org/wiki/Loughborough_University

http://en.wikipedia.org/wiki/Media_Control_Charts

http://en.wikipedia.org/wiki/Media_Control_Charts

http://en.wikipedia.org/wiki/Bill_Clinton

http://en.wikipedia.org/wiki/Dalai_Lama

http://en.wikipedia.org/wiki/Dalai_Lama


Events at International Business Society @SIMSR

On 7th July 2011, we had the privilege of

attending an interactive session with Mr.

Prabhakar Dalal, Executive Director at EXIM

bank. Mr. Dalal with his varied experience and

expertise on Indian Banking Sector enriched

our learning to a very large extent. He also

shared with us anecdotes which were not only

relevant but also served as food for thought,

for students who would be future managers.

He also took up questions pertaining to the

topics covered and attended them in great

detail from a government institution‟s

standpoint.

Mr.K.C.P.Patnaik

Mr. Prabhakar Dalal with Prof. C. P. Joshi

We had with us at SIMSR, Mr. KCP Patnaik;

Commissioner of Income Tax Department, to

talk on International Transfer Pricing and

International Taxation on 23rd

July 2011. His

vast knowledge of the subject augmented our

classroom learning, and as students of

International Business we could relate even

better with the topics he touched upon. The

students also enthusiastically interacted with

him, getting better insights into International

Transfer Pricing. Prof. CP Joshi, Program

Coordinator, PGDM (IB) and Dr. R. K.

Pattnaik, Faculty SIMSR participated in this

interaction.

