SUSTAINING INNOVATATION

SUSTAINING INNOVATION

This video on HBR Blog explained  about the "DISRUPTIVE INNOVATION" which tells how does the small young company beat the industry giant on its own terms.

The players focuses on sustaining innovation by upgrading existing product and services,giving cool features to attract higher paying customers but still they ignore all the regular customers who just want simple low cost alternative that's where these small young companies jumps in inventing their  products which is easier to use and at same price. 

Big giants focuses on more paying customers and begin to over serve by adding some extra features  which no one wants to pay for whereas the young companies increases its product in order to attract more customers by the time giants notices the young companies have all ready taken over the market an classic example of its is MILLS which produces more in a low price than the giants.

Like Toyota they started producing luxury features in their car as they were producing simple cars.

All the giants to come up with this problem they should treat the project as a separate unit with a different business model by asking what job customers need done segment customers by job not by product,market and by developing low-cost solutions to get the job done by cheap and effective methods.

Disruptive innovation creates new market different from the existing once to achieve goal in fast changing world 

FDI IN RETAIL

FDI IN RETAIL

Hello friends.

  We are in favour of FDI in retail. India is a developing nation and like any developing business the Indian market also needs lots of investment for its growth, for the growth of the country. We agree with  my friend as they says that we talk about globalisation on one side and put off the idea of FDI on the other hand.

I just want to put some valid points why it is necessary in a developing country like India.

1. Stable economy.
2. Low inflation.
3. Access to the advance technology of the world.
4. World class infracture.
5. Better utilisation of resources.
6. Good foreign exchange.
7. Increase in employment.
8. Increase in the no.of trained labours.

These are just few but major advantages. Now we want to give some practical data from India and across the world.

Before 90's FDI was not considered good for the country. But after 91 when FDI was allowed in India.

1. GDP grew from 1.7 % to around 5% in 95.

2. Inflation came down from 17% to 7% in 95.

3. Financial deficient came down to $1 billion from $9 billion in 95.

Now if we talk in the context of the world there are many asian countries where it is accepted heartedly. Malaysia, Singapore is such countries which accepted this policy and all of us are aware of the development of this two countries. In china they have the policy that chinese government won't accept an investment below a certain amount but it may go upto even 100% investment. The minimum investment should be 25% in china. Similar is the case with Thailand. But in India we talk that investment should not be higher than a fixed value in most of the sectors. Currency reserve bank of India allows fdi with max 51%.

Investment in most of the sectors except one or two sectors where it is 100%.

There may be some demerits also of FDI like.

1. There may be monopoly in the market if a particular investor is the major player.

But we think this problem can be sort out with some strict rules and of course if our leaders play their role actively and wisely.

Over all we want to conclude that FDI is very necessary in India if it wants to run on the track of developed nations. There may be some demerits but it has major advantages as compared to demerits. And we should change our thought for this. We should try to look the other side of the coin which has many gifts for us.

Thank you.

FOREIGN DIRECT INVESTMENT IN INDIA

FOREIGN DIRECT INVESTMENT IN INDIA

 

Broadly, foreign direct investment includes "mergers and acquisitions, building new facilities, reinvesting profits earned from overseas operations and intra company loans"^.In a narrow sense, foreign direct investment refers just to building new facilities. The numerical FDI figures based on varied definitions are not easily comparable. As a part of the national accounts of a country, and in regard to the GDP equation Y=C+I+G+(X-M)[Consumption + gross Investment + Government spending +(eXports - iMports], where I is domestic investment plus foreign investment, FDI is defined as the net inflows of investment (inflow minus outflow) to acquire a lasting management interest (10 percent or more of voting stock) in an enterprise operating in an economy other than that of the investor. FDI is the sum of equity capital, other long-term capital, and short-term capital as shown the balance of  payments. FDI usually involves participation in management, joint-venture, transfer of technology and expertise. Stock of FDI is the net (i.e. Inward FDI minus Outward FDI) cumulative FDI for any given period. Direct investment excludes investment through purchase of shares. FDI is one example of international factor movements

Top 10 Flls In India Based On M-Cap As On Sept '05	Market Capitalization of Investments as in December 2005 in US $ Billion*
HSBC	3.12
Morgan Stanley	2.42
Merrill Lynch	2.31
Goldman Sachs	2.26
CLSA	2.10
Aberdeen	1.96
Copthall	1.85
Citi	1.81
Genesis	1.80
Capital	1.71

*Based on holdings of more then 1% and above in Individual companies.
Sources Exchanges and company web sites.

The top 10 investments by Foreign Institutional Investors (FII) in India
Companies	Investment value in Billion$ - December 05	Market cap* as on Jan 04 2006	Trailing PE as on January 04, 2006*
Infosys	7.90	83790	38.6
Reliance Industries	6.30	129541	14.1
Bharti Tele	2.60	65198	29.7
HDFC	3.20	30962	27.4
ONGC	2.80	169108	11.5
Satyam	2.00	24752	29.3
HDFC Bank	2.30	22889	30.3
SBI	1.60	48322	10.5
	The FDI hot spots! Asian Investors European Investors North American investors China China China India India India Hong Kong Poland United States Australia Russia United Kingdom Vietnam United States Brazil