GM14

Strategic Management
Assignment No.I

Assignment Code: 2011GM14A1 Last Date of Submission: 31st March 2011

Maximum Marks:100

Attempt all the questions. All the questions are compulsory and carry equal marks.

Section-A
Ques.1 There are various reasons why companies adopt mergers as an expansion strategy.
Explain these various reasons for mergers.
Ques.2 Distinguish between Vertical and Horizontal Integration.
Ques.3 Choose an industry in which you would like to compete. Use the Five Forces Method of
analysis to explain why you find that industry attractive.
Ques.4 Define the steps of Strategic Management Process and elaborate its Critical Tasks.
Differentiate between Strategic plan and operational plan.

Section-B

CASE STUDY
Sambi Fabrics, a Tirupur based garments and piece goods firm which exported all its products to USA, faced
a decision in August 1985. The US govt had imposed quota restrictions which reduced the exports of his firm
by 40%. He had to find a new market for his products.

Sambi Fabrics was one of South India’s major exporters of garments and piece goods. Its share was 25% of
the exports of these goods of the whole country. It was established in 1954 as a producer of cotton cloth and
late in 1966, it extended production to include garments and piece goods. It had eight local production units
and the total number of employees was 8000. All its garments and piece goods were exported to USA and the
same of the firm amounted to US $ 100 million. In 1984, the US Government imposed quota restrictions. By
August 1985, Sambi Fabrics exports had been reduced by 40%.

The Company believed that finding new markets were the only way to survive. The possible alternatives
according to them were the EEC countries, the USSR and Middle Eastern Arab countries and the other Asian
countries. The EEC was a very good potential market, but Europeans were very tough buyers. It would be
necessary to segregate the EEC from other buyers because of their existing specifications with regard to
style, color and packing. The USSR too was a potential market as far as demand was concerned, but the
country did not have enough money in foreign exchange.

The middle Eastern Arab countries had money, but their requirements were small due to their smaller
population. Second, these countries preferred not to buy Indian goods directly from India. They would rather
like to buy the same Indian goods, brand them differently from that of other Western countries like ‘Made in
England’

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Asia was big market, but the Asian countries were in competition with the company in the international market.
The company was deeply concerned with the loss of 40% of his export goods. They were eager to determine
which new markets offered the highest potential. He wondered what specific information he could use to help
in his decision.
Questions:

1. What information should the company develop to evaluate foreign markets.

2. Develop a framework to help the company identify their best potential foreign markets.

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 GM14
Strategic Management
Assignment No.II

Assignment Code: 2011GM14A2 Last Date of Submission: 15th May 2011

Maximum Marks:100

Attempt all the questions. All the questions are compulsory and carry equal marks.

Section-A
Ques.1 In today’s global environment, change rather than stability is the order of the day.
Rapid changes in technology, competition, and customer demands have increased
the rate at which companies need to alter their strategies and structures to survive in
the marketplace. With the help of suitable example , explain why change is necessary
and how organizations manage change.

Ques.2 “Strategic controls are intended to steer the company towards its long term strategic
goals.” Explain what are the different strategic controls can a firm initiate for the above
objective.
Ques.3 “The role of the Board of Directors is to protect the interest of the Shareholders.”
Explain how can the Board look after this function given that they are not expected to
interfere with the day to day management of the firm.
Ques.4 Define the term Social Responsibility. Select an example of a Company action that
was legal but not socially responsible. Defend your example on the basis of your
definition.

Section-B

CASE STUDY

MANAGEMENT OF BUSINESS ETHICS IN TATA STEEL

( source: Ninety eighth annual 2004-05 of Tata Steel )

The year 2004 held a special significance for the Tata Group. It marked the death centenary of its founder
Jamsetji Tata and the 100th birth anniversary of JRD Tata and Naval Tata.

The ethos of the Tata Group can be captured in Jamsetji Tata’s words, “ We think we started sound and
straightforward business principles, considering the interests of the shareholders, our own and the health and
welfare of the employees the sure foundation of our success.”

Tata Steel paid homage to them by no better means than reinforcing and institutionalizing the values and beliefs
so strongly cultivated and nurtured by them. July 2004 was celebrated as Ethics Month which began with
reinforcing the values by each employee taking Ethics Pledge. Realising the usefulness of Ethics Education
among students, the Company encouraged the school students of the city to pay homage to JRD Tata by taking
Ethics Oath. Continuous endeavours were made to reinforce these values among all stakeholders. Knowledge
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Manthan on Business Ethics with our employees and vendors were conducted for greater involvement of
employees and vendors in Company’s Management of Business Ethics (MBE Programme.) The Values and Code
of Conduct were further strengthened by developing policies like Gift Policy, Whistleblower Policy, Vendor Action
Policy etc. The Company provided more channels for reporting to facilitate whistleblowers to raise their concerns.
The stakeholders are encouraged to voice their concerns through web-based channels e.g. e-Procurement site for
vendors, e-Sales for customers etc. The senior citizens ( ex.employees) of the company are also given access to
Company’s website with a facility for them to send their views to Ethics Counsellor.

Senior Leadership team demonstrates ethical behaviour by ‘walking the talk’ or by being the role model
themselves. They discuss ethical issues in forums like General Dialogues, Senior Dialogues etc. where
Company’s Executives are invited to share their view on various subjects.

The effectiveness of communication and development measures is evaluated by analysis of the concerns
received and also by various surveys conducted by internal and external agencies. These measures show that
MBE system is fully in place in the Company.

Questions:

1. Why did Tata Steel consider Ethics as an essential part of their Strategy.
2. Was the concept of Ethics only a lip service or did they really mean it. Explain what steps they took
towards Business Ethics.
3. Do you think the recent controversies on the Singur Small Car Project and the fight over Corus takeover
represents a deviation from the Ethics that has been said in the above case.

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