Business strategy concepts and frameworks

Business Strategy

India is a rapidly changing country that many foreign companies see as an extremely lucrative opportunity for international growth. Avaya is one of those companies. According to the research, Avaya is a "U.S. based manufacturing company [that] is a global leader in communication systems, applications and services. It designs, builds, deploys and manages networks for enterprises."

It has been implementing strategies to slowly focus on entering into the Indian telecommunications market for several years now. Working within the Asia Pacific submarket, India proves an incredibly challenge, but yet also a potential lucrative reward.

Avaya has focused on entering into the country with an approach using strategic partnerships with the example of Tata Telecom, a partnership between Avaya and the Tata Group of India.

Thus, Avaya is essentially tapping into an already established system, banking on its reputation to help increase profit potential in India, as it expects worldwide.

STEEPL

Social Factors

India is a massive nation, with millions of residents. Its demographics very incredibly, thanks to the vast regional differences caused by extreme physical distances. The nation has the second highest population in the world, behind China.

Still, it has a largely rural population base, but with growing population density rates in vast urban sprawls. There are also staunch class differences seem to be embedded into the national culture, because of the long dominance of the caste system which distinctly separated socio-economic classes in India for centuries. Although the government has officially banned the caste system, it still plays a large role in social structures and how different classes interact with one another. This feeds into the immense digital divide that separates Indians who are able to use modern technologies from those within lower socio-economic classes that still do not have access to innovative telecommunications technology. Here, the research states that the "digital divide refers to the unequal availability of Information and Communications Technology (ICTs) to different socio-economic groups."

Technological Factors

Changing technology has continuously redefined the nature of the telecommunications industry worldwide. The major trend today is an increasing mobility within the context of available telecommunications solutions, without having to sacrifice quality of communications themselves. According to the research, "Telecom services are now becoming highly mobile and are delivered by the medium of radio waves. Whereas, until some 50 years ago, a majority of international calls were handled through sort wave radio."

There is now an increasing presence of handheld and mobile devices seen within the Indian marketplace as the technology becomes cheaper and more widely available, both on the consumer end, as well as on a service provider standpoint. Moreover, the liberal government of India has been creating economic policies that are open and inviting opportunities for foreign investors and companies to enter into. In order to help entice foreign companies into working within its borders, India has invested heavily on infrastructure, especially in the case of the telecommunications context. This has also had the impact of increasing the privatization of other industries as well, which also benefits Avaya's entrance into India. Essentially, Avaya builds and maintains networks for other professional genres along with telecommunications services. Therefore, the growing number of businesses in India, from small to enterprise, opens up a greater clientele base for Avaya in the Indian marketplace. Innovation is spreading globally, and is not constrained by cultural or regional boundaries as it used to be. Therefore, internet penetration increasing as class differences begins to fade in importance within Indian society. As more technologies become cheaper and more widely available because of growing investments into India's infrastructure, more of the population now has access to telecommunication products. This has spurred a huge growth in demand for cellular, internet, and other communications products.

Environmental Factors

India is an incredibly diverse country in terms of geography. Its vast borders include almost all kinds of topographies, from low lying jungles, to high mountain deserts. The extreme physical features of India can hinder business from acting large scale on a national level. It is often incredibly difficult to provide service or products to some clients in the most remote areas of the nation. These remote areas are often extremely limited in terms of what technologies are available as well because of the high cost of connecting villages so far off the map. India's cities, on the other hand, are often overcrowded, leading to separate issues within the city regarding high retail space and rent considerations.

Economic Factors

The economic outlook in India is extremely positive. The free market structure is gaining speed in India

Recent governmental changes in 1991 have helped capitalize on a freer economic structure in the region by lessoning high tariff barriers for foreign companies looking to enter into the Indian market.

Here, the research states that there was recently "A series of reforms aimed at further deregulating and stimulating foreign investment have moved India firmly into the front ranks of growing international economies."

This has helped lower entry barriers for foreign companies looking to set up shop in India. It has also helped facilitate the growing business start up environment. According to the research "India's known strength in software and Information Technology (IT) and tremendous e-commerce potential ensures a progressive trend in the Indian economy."

Thus, starting up business in India is much easier than many other Southeast Asian nations that share its regional identity.

However, there are major business risks involving the intense competition within the Indian environment. Since the infrastructure is there, and the people of India are more than willing to eat up the latest gadgets and technology products, many foreign companies have already established strongholds within the region.

Companies large and small, are already operating within India for products and services geared towards the Indian people. Therefore, there is a high barrier to entry in terms of stiff competition from companies around the globe that already hold a strong presence in the region. Major companies like Tyco are continuing to gather a hold of the telecommunications market, limiting what Avaya can work with.

Political Factors

Growth of private ownership of telecommunication facets has been seen worldwide, and such is the case for India. Telecommunications was once largely the responsibility of the state; however, as modern companies began to grow into other borders, the industry was often split into various privatized sects. However, India has been slow to tap into this emerging trend. Research shows that still as late as 2006, privatized telecommunication facets made up only a fraction of what was being made available by the state.