Curry Crisis A) Madhu\'s Business Is Not

Curry Crisis

a) Madhu's business is not highly globalized. He produces and sells in the UK. However, one of his major inputs is chefs, and the ones with the skills he needs are not typically found in the UK. Indian chefs almost always come from India or from expat Indian communities elsewhere. This element of his business is globalized, because Indian cooking is a specialized skill that originates from a specific geography, and is not readily found either in the UK or in other parts of the world.

b) The four drivers of globalization are cost, market, government and competition. In the case of Madhu, the most important are market and competition. Cost is not a major factor. Madhu does not appear to have an issue with the cost of Indian chefs in Britain. There is no indication in the case that he is unwilling to pay a higher price for local talent -- there simply appears not to be local talent. Madhu does have the option of training some workers, but the learning curve is steep and the cost of training is prohibitively high. Intense competition in the industry means that there is a need to control costs in addition to being differentiated on quality, especially when dealing with department store and other institutional customers.

Market drivers are much more important for Madhu. In this case, the market for curry has moved to Britain, but the result is that there is a very high demand for this product in Britain. It is much easier to produce locally, given the nature of Madhu's food. This means, however, that Madhu needs to find a supply of labour that will allow him to undertake that production. He is finding that his labour cannot readily be obtained but from India. Thus, he is taking an Indian product, wants to produce it locally, but needs Indian talent to do that. If the market for curries did not exist in Britain, the problem would not exist. If the market did not exceed the supply of qualified Indian chefs, the problem would not exist.

Government is a major problem in this situation, but is not the driver of the globalization. Initially, the curry business in England derived from migrants from the subcontinent, however, so immigration policy set by the government created the initial demand, and provided a talent base to fill that demand. When non-Indian Britons took to curry, the globalization was taken to another level, but the production of curry has not followed suit. If the government lowered the trade barrier -- the restrictions on labour imports -- then the industry could thrive. The curry business would grow, and Britain could become an even stronger player, with its companies possibly able to export.