CASE STUDY Sunlight Chemicals.

1. Is Sunlight on the right track in going global without trying to consolidate its position further in thehome market?

Answer 1. Ram Charan Shukla has taken sunlight industries to a place where the early management would not have really envisioned to see it. It is because of the continuous effort of Mr. Shukla, to have the right people at the right place, that the company has grown to what it is today a global MNC. It is the fruits of his labour which has become ripe with a Rs. 500 crore turnover company with 40% of the revenue coming from International operations. All of his efforts can be found in the growth of company with manufacturing concern in 8 countries and with a span of business in 40 countries. But Mr. Shukla should also consider that the remaining 60% turnover which is Rs. 300 crore Is from the domestic or national operation of the business. Yes, sunlight is in the right track considering the amount of jump in the revenues have been due to the company going global. But at the same time he cannot ignore the fact that still 60% of the revenue is from the national market. Moreover due to the diversity of the various global markets and different working environment in the international market, can hamper the revenue generation from that area at a certain point of time. We know that business is surrounded by uncertainty most of the times, but if we look into our domestic market we can in some way try to cushion the impact of loss of revenues from the overseas market.

To combat such a situation Mr. Shukla should think of further consolidating the companys position in the local market also.

2. Can Sunlight realise its global vision with its current mix of strategies? However fine the company's HR planning had been, had Shukla made a mistake by not developing his strategies first?

Answer 2. Sunlight industries have developed a very good and robust HR planning methodology with the help of Mr. Dwivedi. No doubt it is the people that makes a company and the management of people should be one of the priorities of the company, Strategic management is concerned with the process of formulating, implementing and evaluating strategies to achieve a firms objectives. In concept, strategic management process in an MNC is similar to that in any other form of organisation. The main complicating factors being the numerous country and regional environments it has to analyse and understand before considering the various strategic options. Strategy formulation occurs at three levels Corporate, Business and Functional. Corporate Level Strategy It seeks to define the domain of businesses the firm intends to operate. The focus is on questions related to business portfolio, including patterns of diversification and risk return issues. The four key approaches to corporate strategy are growth, retrenchment, stability and combination. When an MNC seeks to have a mix of growth, retrenchment and stability strategies across its subsidiaries it is said to pursue a combination strategy. Business Level Strategy Whereas corporate strategy deals with the overall organisation, business energy focuses on specific subsidiaries or operating units within the firm. Where the MNC is engaged in just one

line of business, it needs to have single strategy which is common to both the subsidiary as well as for the entire organization. Before formulating a business level strategy the MNC needs to decide on its general competitive strategy in the market place. The general competitive strategy may be low-cost leadership, differentiation or focus and according to Michael Porter, offer competitive advantage to a firm. Functional Level Strategies - Corporate and Business strategies are implemented through functional strategies, Functional strategies involve management of all functional area, production, marketing, finance and HR, in such a way that they subserve the interests of corporate and business strategies. For Example, financial strategy of an MNC deals with such issues as the firms desired capital structure, forex holdings, risk reduction techniques, debit policies and working capital management. International marketing strategy concerns the selling and distribution of the firms products or services. Likewise, international operations strategy deals with the creation of the firms products or services. Similarly, international human resource strategy focuses on the people who work for the organisation. Mr. Shukla is having a focus on the Functional Level Strategy but he is concentrating more on the HR side of it, but he should be focusing on other functions also or the whole basis of following a functional strategy would be useless in a longer period of time. Therefore, he should concentrate on developing his strategies also.
4. What are the learnings that you can derive from the "Sunlight" case so far as the internationalization of business is concerned?

Answer 4. The learnings from the Sunlight are :a. In order to achieve growth in the international market one has to take its company out of a domestic centric mindset.

b.

The company should be divided by keeping in mind the ideologies of various countries in which it is dealing and to club the businesses of those countries which has a similar mindset or are mostly similar to the ethics of business.

c. To look at how the market mix would evolve and then create a matrix to suit that mix. d. Hierarchies should be made in such a way that it should represent the company accordingly to the country in which it is working.

e. The selection of higher management should have people with broad business prospective with a multi-functional, multi-market exposure. f. Since specific markets need specific competencies, for that local CEOs should keep track of changes in regulations and gauge the market of that company. g. The focus of the higher level management should encompass all the facets of business and not just one.