Case Study for Welspun Group- MyAssignmenthelp.com

Question: Discuss about the Case Studyfor Welspun Group. Answer: Introduction The case analysis uses the Welspun Group to showcase the how the organization is riding the globalization wave. The company is a clear instance of the globalization phenomenon. The firm began modestly as a polyester manufacturing facility in the year 1985 within a small town in India. Its initial capital outlay was US$250,000. However, the firm has currently grown into about US$3 billion global corporation. It has widespread presence in over fifty nation crossways the world via different trade channels. The corporation remains among the leading fastest-evolving global groups. It is a market leader in the business segments including yarns, home pipes and textiles. The group has the uniqueness in terms of being the 3rd hugest home textile corporation globally and the largest Indian retail chain for the same. The group enjoys global investments in the United Kingdom, Portugal, US, Mexico, Saudi Arabia. It has the business relationship with various Fortune 500 corporations including Chev ron, Bechtel, Exxon Mobil, Target, Walmart and Shell. Thus, this paper is a critical evaluation of the Welspun Group case to showcase how it is a typical case of a ridding globalization wave. Identification of Problems The group has been successful in its acquisition and focus on the energy as well as infrastructure sectors which are two fastest-growing industrial sectors in India and other evolving markets. The group has transformed into such a huge global entity within a short duration. The group achieved this by focusing on concurrent geographical as well as product diversifications strategies for growth. Such strategies encompassed expansions into novel markets alongside products (Karides 2013). However, it must be noted that adoption of such diversification strategies remained highly risky as well as cumbersome. This is because the diversification required an extremely distinct set of the capabilities for the group to succeed in each kind of the diversification (new markets and new products). Nevertheless, the company remained highly careful with respect to the selection of its novel markets alongside products to avoid being overstretching its scarce resources. The group primarily focused on developed markets of the US along with those of Western Europe. It never went for an all-out internationalization that would have encompassed entry into new geographically proximate developing markets. On the basis of products, the company made entry into increasingly diverse industrial sectors like pipes, energy, and infrastructure contrasted to its original line of business, that remained entirely in home textiles. The companys tow chief flagship businesses in pipes and textiles were based on the cotton and steel supplies, individual moving in a cyclical fashion though not in the similar manner. Therefore, engagement in such two businesses remained a healthier strategy for the company as a whole. Provided the groups swift growth speed, the company is continuously restructuring and reorganization of itself to undertake its operations and activities efficiently. Thus, the obvious diversification into perceivably unrelated business is primarily at the company level, whereas the individuals firms are focused on sole or linked businesses. For instance, its home textile business remained under the control of Welspun India Limited (WIL) that is listed corporation on National Stock Exchange of India and the Bombay Stock Exchange. Such a type of organizational structure as well as following transformation have permitted the company to prosper in multifaceted business segments stretched across the diverse geographies. The company further remained prudent with respect to the firms foresight to put the groups bets on the growing role of offshoring and outsourcing strategy that huge retailers in the advanced markets were embracing. Such implied that retailers like Target and Walmart shall contract with firms characteristically based in low-cost economies to manufacture commodities as well as serve as their respective suppliers (Sheth 2016). The company maximized/capitalized on such an increasing pattern by being a key supplier to various large retailers in the US for their corresponding textile-associated requirements. Further, the company proactively pursued global partners for the groups operations in India. The company has formed joint ventures with Italian firm for the bathrobe manufacturing as well as with a German firm for coating pipe. The phenomenal growth of the group has also been attributed to its motto Dare to commit. It further benefits from BKG and RRM entrepreneurs who are its key architects for the fast-speed growth. BKG remained the lead visionary in spotting business opportunities in the high-growth sectors thereby accounting for the groups current in the diverse array of businesses including home textile, energy, pipes, infrastructure as well as steel. Provided the constraints of the capital as well as the managerial resources that characteristically plague SMEs in the emerging markets like India, making an entry into this myriad set of industries crossways diverse economies remains a sign of astute business acumen as well as risk-taking ability of the group. The group further faces competition in entering diverse business segments which is the norm for the Indian business houses. This makes the group not to stand out from its rivals or competitors. The group is further facing challenges since in its attempts to differentiate itself from the Indian rivals, the business is forced to adopt strategies to tap into many unconventional opportunities overseas. These opportunities are risky as the firm has to establish manufacturing facilities in foreign markets and acquire established brands. The group must have to use more money and other resources to create uniqueness overseas where it will also face the competition from the advanced or established firms producing the same commodities (Huberman and Meissner 2010). Moreover, the group is facing such challenges as diversification of product and market, product selection, brand recognition and offshore and outsourcing as it continues on its path of growth through globalization. In terms of brand recognition, the group requires to have a healthier reputation in the market since it is a newly set up company. Offshore and outsourcing must be done in order to meet the demand across the world as well as save the cost of manufacturing. The firm is facing such problems as scarce resources as well as demanding customers. There is also a need to maintain human capital is quite challenging to the group. The international competition also threatens the group alongside flexibility to adapt the altering global market. As has been witnessed, the trend towards globalization of the Indian firms is anticipated to strengthen further. This is because India makes fast strides in its economic growth which is further increasingly becoming an appealing destination for the global companies, thereby heating up the local competition. The Indian firms can never negate the fact that to face this rivalry, they not solely have to emerge stronger in the local market, but further challenge these firms in the global turf. The Welspun company will resolve the identified problems by increasingly becoming a MNC in its individual right via sizeable investments made overseas or continue to become suppliers of the choice of the international companies by leveraging lower Indian costs. This patter shall increasingly stretch to the subsequent rung of the corporations who are pursuing aggressive growth, with foreign acquisition being the most favored route (Cavusgil et al. 2014). Welspun must realize that it is necessary to achieve global size as well as competitiveness to create a vaster market position as well as sustain a strong position in the international markets. To accomplish this desirable global size, the Welspun needs to look at growth opportunities outside Indian borders (Nzaad 2017). Whether it is manufacturing firm which is adding relationships as well as customers via the transfer of work into India, or Software Company which is strengthening its domain capabilities, the Welspun should know that the message is clear that: to succeed, it will need to expand its global reach through the development of vision, capability as well as management bandwidth. After all, globalization history of the Indian firms has lessons to avail to those companies planning to embark on the similar route (Becker 2017). Conclusion The company enjoys cumulative yearly annual rate of growth since 1995 of more than thirty percent. This remains high by any given standards/metric. The group has diversified into newfangled lines of business and adopted globalization for its markets besides production. The group has adopted a strategy of tapping into various lucrative opportunities which remain unconventional as well as risky as establishing manufacturing facilities in overseas markets as well as acquisition of established brands abroad thereby creating a sustained competitive advantage by differentiating it from its Indian rivals. References Becker, K., 2017. Editorial. Journal of Transnational Management, 22(1), pp.1-3. Cavusgil, S.T., Knight, G., Riesenberger, J.R., Rammal, H.G. and Rose, E.L., 2014. International business. Pearson Australia. Huberman, M. and Meissner, C.M., 2010. Riding the wave of trade: the rise of labor regulation in the golden age of globalization. The Journal of Economic History, 70(03), pp.657-685. Karides, M., 2013. Riding the globalization wave (1974-2004): Islandness and strategies of economic development in two post-colonial states. Island Studies Journal, 8(2), pp.299-320. Nzaad, N.A., 2017. Corporate Social Welfare: Rural Perspective. Global Journal For Research Analysis, 5(10). Sheth, C.R., 2016. A Comparative Study on Cash Flow Statements of Welspun India Ltd. and Ghcl Ltd. Indian Journal of Applied Research, 5(7).