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CASE STUDY: OVERSEAS OVERTURES
Staring at the vast expanse of the Arabian Sea from his corner office at Mumbai`s Nariman Point, Ramcharan Shukla, the 53-year-old executive vice-chairman and managing director of the Rs 500-crore Sunlight Chemicals (Sunlight), felt both adventurous and apprehensive. He knew he had to quicken theglobal strides that Sunlight had made in the last four years if the company were tobenefit from its early gains in the world markets. However, he was also shaken by a doubt: would his strategy of prising open international markets by leveraging the talents of a breed of managers with transnational competencies succeed?
Globalisation had been an integral part of Sunlight`s business plans ever since Shukla took over as managing director in 1990 with the aim of making it the country`s first international chemicals major. Since then, Sunlight—the country`s third-largest chemicals-maker—had developed export markets in as many as 40 markets, with international revenues contributing 40 per cent of its Rs 500-crore turnover in 1994-95. The company also set up manufacturing bases in eight countries—most recently in China`s Shenzhen free trade zone—manned by a mix of local and Indian employees. These efforts at going global first took shape in December 1991 when Shukla, after months of deliberations with his senior management team, outlined Sunlight`s Vision 2001 statement. It read: "We will achieve a turnover of $ I billion by 2001 by tapping global markets and developing new products." The statement was well-received both within and outside the company. The former CEO of a competitor has said in a newspaper report: "Shukla has clearly sensed the pressures of operating in a new trade order with a tough patents regime."
But Shukla also realised that global expertise could not be developed overnight. Accordingly, to force the company out of an India-centric mindset, hestarted a process of business restructuring. So, the company`s business earlier divided into domestic and export divisions, was now split into five areas : Area 1 (India and China), Area 2 (Europe and Russia), Area 3 (Asia Pacific), Area 4 (Us) and Area 5 (Africa and South America). Initially, managers were incredulous, with one senior manager saying,: "This is crazy. It lacks a sense of proportion.”
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Read the case entitled `Overseas Overtures` and answer the following questions :
(a) Do you agree with the view of Avinash Dwivedi on restructuring Sunlight Chemicals ? If yes, why ? If no, why not ?
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(b)Comment on the strategies adopted by the company to groom global managers. Explain the principles/concepts based on which the management may have taken the decisions of recruiting and posting employees.
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(c) Critically evaluate if proper use was made of employee training and performance appraisal in Sunlight Chemicals.
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(d)Comment on Sunlight`s technological competitiveness to be a global player. Suggest how the company could improve its competitiveness in terms of human resources.
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