Introduction to MNCs

MNCs are such companies or institutions that meet out the services and the productions to many countries and there institutions. They serve the customers and the institution best and simultaneously the magnetic chemistry between the country and the foreign MNCs has shown some fruitful results too. Off late the scope of international's performance in India has widened and these influxes in the flourishing on the varied scope are due to the talent and the cost factor that brings the MNCs here. These are not the sole prior causes of the Nokia, Vodafone, Fiat, Ford Motors and as the list moves on- to flourish in India. As the basic economic data suggest that after the liberalization in 1991, it has brought in hosts of foreign companies in India and the share of U.S shows the highest. They account about 37% of the turnover from top 20 companies that function in India. Keeping the 'Big Boss' apart there are certain other companies hailing from Britain, France, Netherlands, Italy, Germany, Belgium and Finland that have made a strong footing in India too. They are well flourishing and earning there share of maximum profit too.

Why are Multinational companies in India? There are a number of reasons why the multinational companies are coming down to India. India has got a huge market. It has also got one of the fastest growing economies in the world. Besides, the policy of the government towards FDI has also played a major role in attracting the multinational companies in India. For quite a long time, India had a restrictive policy in terms of foreign direct investment. As a result, there was lesser number of companies that showed interest in investing in Indian market. However, the scenario changed during the financial liberalization of the country, especially after 1991. Government, nowadays, makes continuous efforts to attract foreign investments by relaxing many of its policies. As a result, a number of multinational companies have shown interest in Indian market.

Profits of MNCs in India It is too specify that the companies come and settle in India to earn profit. A company enlarges its jurisdiction of work beyond its native place when they get a wide scope to earn a profit and such is the case of the MNCs that have flourished here. More over India has wide market for different and new goods and services due to the ever increasing population and the varying consumer taste. The government FDI policies have some how benefited them and drawn their attention too. The restrictive policies that stopped the company's inflow are however withdrawn and the country has shown much interest to bring in foreign investment here. Besides the foreign directive policies the labour competitive market, market competition and the macro-economic stability are some of the key factors that magnetize the foreign MNCs here. Following are the reasons why multinational companies consider India as a preferred destination for business:

Huge market potential of the country FDI attractiveness Labor competitiveness Macro-economic stability

Advantages of the Growing MNCs to India There are certain advantages that the underdeveloped countries like and the developing countries like India derive from the foreign MNCs that establishes. They are as under: Initiating a higher level of investment. Reducing the technological gap The natural resources are utilized in true sense. The foreign exchange gap is reduced Boosts up the basic economic structure.

Multinational Corporations in India

1. IBM India

IBM India is the subsidiary of IBM. It has grown in huge stature in India after it made a reentry in 1992 after the exit on 1970,s. It has the largest number of employee in India in comparison to any other MCs in India. Year 2002 2003 2004 2005 2006 2007 2008 2009 2010 Employees 5000 9,000 23,010 38,500 53,000 74,000 94,000 1,12,900 1,31,000

2. Nokia Communications

People with nokia handsets are a daily sight. Nokia has crept in Indian scenario and culture very fast but with a steady pace. It made its way to Indian market in the year 1995 and off ate it has come out as a renowned company singing its glory. Nokia operates in the major metropolis in India and even in certain other major states too. They have flourished their business very strategically. The device market of Nokia has diversified its aim to cater to different customers and consumer segments. More over their close links with the operators have helped them to flourish over a wide geographical area which have lead them to be the highest and the largest network distributor. Employee head count:

On the start the company had 450 people working India in the year 2004 but it soared over 15000 employees in the year 2008. Today India comes 2nd I raking in the list. Growth rate The growing market strategy of nokia shows that 8 million new subscriber come in every month.and the estimated rate shows that it's market would grow to US $427 billion in 2010. 3. Reebok in India Reebok had a very hard start in India. They only had the male accessories and later the market added the female products. Rebook apart from having the sports goods had variety of other products too. India to them is the market of growing importance. More over the flourishing sports in India in all forms whether the national or international cricket and football or the local form like IPL have used this brand for promoting and even at times sponsoring. The cricket IPL format from 2008 to that of 2011 has seen some of the state to promote this brand recently. They have a good hold on the market and cater to consumers fancy. Growth rate Reebok claims to have a come a long way off late. This has reached success in all levels in Indian scenario since it had made its way along. The sales at reached exceedingly to $91 million since 2005.

Profit rate Reebok's Indian revenue has turned out to be nearing 1400 crores in the year 2008. Even the same rate was maintained in the year 2009 as the IPL fanned the floor of marketing.

They have kept there strategy the same through out and made a quiet secured and a healthy footing in Indian market.
4. Ranbaxy Laboratories

Established in 1961 Ranbaxy is the largest pharmaceutical company in India. Operating across 45 countries and offering manufacturing facilities in 7 this multinational company in India actually started off way back in 1937. Ranbaxy entered the US market in 1998 and it went on to become the biggest share holder of the US pharmaceutical market in 2005 by holding almost 28 percent of the market share. In December 2005 Ranbaxy's total sales stood at US $1,178 million. Since the operations of the company are spread across the big and small cities of India the company employees a huge section of the Indian population. Currently there are 12,995 people employed with Ranbaxy in India. The revenues earned by Ranbaxy Laboratories in 2010 stood at ` 4,198.96 Billion. The profit for the same year accumulated to $327 Million.
5. Tata Motors

Tata Motors is among the top multinational companies in India. It is an operating subsidiary of the Tata Group. Tata Motors was established in the year 1945 and since then it has become the country's largest automotive producers. It is listed on both the Bombay Stock Exchange and the New York Stock Exchange. In 2005 this multinational company featured alongside the top ten firms in India procuring annual revenue of ` 320 billion. Tata Motors is ranked amongst the top employers of the country. The current strength of employees in the company stands as 50,000. In the year 2010 the total revenue earned by Tata Motors was $20.572 billion posting a growth rate of almost 64.2 per cent.

Emergence of Indian Multinationals

World over the focus is shifting to setting up facilities for competitive and high value added production and services. This is driving organizations in various countries to

undertake technology up gradation and modernization in their production processes and services so as to develop state-of-the-art technological capabilities for survival and growth, in both, domestic and the export markets. With the onset of rapid globalization, organizations are relying more and more on technology acquisition, adaptation and absorption, besides indigenous technology development. The technology trade business demands that the countries spread awareness about their own technological strengths and also, explore foreign markets for exports as well as technology acquisitions. India has a large pool of qualified and experienced manpower and has developed strong industrial and technological capabilities in some sectors, which could be shared with other developing countries for mutual advantages. Indias S&T programmes are designed in such a way that they encourage international co-operation. S&T Agreements have been signed with a number of countries and collaborative work is going on in a number of areas of common interest such as energy security, disaster mitigation, discovery of new medicines for fatal diseases, overcoming water scarcity, easier and cheaper connectivity, etc. It has been Indias endeavour to reach out to anyone in the world and work towards finding scientific solutions to the common problems being faced by the people, the world over. Globalization has become an Imperative for Indian Companies When the Indian economy liberalized in the early 1990s, with the licensing system for setting up industries getting dismantled and foreign direct investment being encouraged, it was greatly feared that Indian companies would not be able to match up to the marketing and financial prowess of MNCs. More than a decade later, Corporate India has shown that it not only has the capabilities to face up to the might of the MNCs who have entered India, but also challenge their position in international markets. Indian companies have been spurred to cross domestic boundaries and consider entry into new products for maintaining their market position. This is most evident in the case of Aurobindo Pharma, which started its transition from a single product, domestic player in mid-1990s To become a multiproduct global player today. Severe margin pressures on its primary product semi-synthetic penicillin forced it to look out for higher margin products and penetrate into new geographies.

Indian Companies have followed a mix of Strategies to Establish a Global Footprint The attitudinal change to turn global has led to the emergence of many Indian MNCs who have overcome geographic boundaries by adopting a mix of business strategies. Most commonly, companies have used the route of Greenfield investments or acquisitions overseas or a combination of both. Others have made their exports more cost competitive vis-a-vis global peers. A few have entered into technical tie-ups with global partners to build capabilities and then leverage them in the international markets. Several companies have ramped up their scale of operations to a level essential for a global foray.

Sustainability
Sustainability is employing profitable strategies that approach social & environmental challenges as business opportunities & minimize harmful social & environmental impacts. Sustainability = Long-Term Health and vitality of an organization

Dimensions of Sustainability Social Set higher standards of living and build a better society Ecological Supply environmental friendly products/services that replace non-green products/services Economic Focus on making profits in ways that obey all Laws

Building Sustainable Indian MNCs

Building Sustainable Indian multinationals calls for innovation, absorption of best local practices, profitability and inculcation of a value system that is acceptable to a broader range of shareholders. Deliberating in detail about managing change for todays Indian enterprises, essential in Building Sustainable Indian multinationals. Change in apparent at all levels of governance and economies. And today, India is poised to take this advantage. The tremendous progress that we have seen during the last 10 to 15 years is because of the people who managed individual companies and led them to success. But today operational structures are changing and companies are no more dependent on individual managerial skills. With increasing global footprint, the young minds at work in Indias corporate arena are far more confident today.

Leadership across the world In India, leadership is a complex change management process. Company leaders realize that the growth of the country depends on effective and sustainable leadership in the business community. Further, in India, the climate for effective leadership is now forward-facingthat is, the focus on the past has moved to a focus on the future. At the same time, there is a mix of tradition combined with technology, new cultural and workplace values taking the place. Paradigm changes for sustainable leadership include: a) Bold risk-taking and innovation, b) Learning and adaptability and c) Short-term to long-term commitment. The most important leadership competencies in the future would include:

a) Effective change management, b) Development of talent/teams and c) Effective collaboration/network-building. Other key leadership competencies would be d) Cognitive ability, e) Strategic thinking, f) Analytical ability, g) Personal and organizational communication skills, h) Diversity management, i) Personal adaptability, and j) Talent management. The study identified the following top 10 business leadership challenges of Indian CEOs: 1) Consistent execution of strategy. 2) Stimulating innovation. 3) Corporate reputation. 4) Expansion in India. 5) Speed, flexibility, adaptability to change. 6) Profit growth. 7) Sustained and steady top-line growth. 8) Business risk management. 9) Changing technologies. 10) Aligning IT with business goals. At Mahindra we are tackling this challenge through an imaginative mix of five specific actions: 1) Global assignments, both short and long term 2) Participation in national and international consortia of like-minded firms that are working together on global leadership programs 3) Creating platforms for problem-solving and action-learning, where managers from our global operations interact with domestic managers

4) Specialized acculturalization programs at Bodhivriksha, our in-house Leadership Centre 5) Networking with international leadership organizations for best-practice benchmarking.

Brand Management across the World BRAND is a promise made to the consumers by the company. Brand, not only has Functional and Mental dimensions but also Social and Spiritual dimensions. The challenge in front of Indian organizations today is to first understand and then satisfy the needs of the customers. The needs of the customers today are experiences and not just the products. The Indian Organizations have to concentrate on delivering the experiences to the customers leading to satisfaction and association with all the dimensions of the brand. These experiences can be delivered by involving the customer in the supply chain which demands improvement from the organization in terms of training the employees and aligning the culture to deliver value to the customers. The participation of the customers can be ensured by using novel methods of communication and branding. The Profit and Sustainability of Indian Brands will depend on how efficiently and quickly the organization can adapt to these new demands of the customers.

Agenda for action

1. Organizations should maintain good relationships with Governments, Non-Profit Organizations, & others. 2. Organizations should maintain Trust, Transparency & Accountability with all stakeholders. 3. Organizations should Trade as a Contributor to economy 4. Organizations should have a policy for sustainable, equitable & democratic growth 5. Govt. should encourage Foreign Direct Investment(FDI) which increases trade and boosts the GDP 6. Individual freedom to participate in markets is an effective means for sustainable development. 7. Conduct business as a creative, entrepreneurial set of activities involving multiple collaborating partners contributing to social, ecological & economic gain. 8. Drift from Products of Service to Products of Consumption 9. Re-focus on the 4 fundamentals of organizational life o Create, grow & nurture Relationships o Accept, Enact on Responsibilities o Seek Continuous Renewal o Measure the Results.