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STRATEGIES FOR HIGH VOLUME SUPPLY CHAINS IN INDIA
by Don J. Palathinkal
(May 22, 2008)
Advisor: Dr. Edgar Blanco
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Agenda
IntroductionIndiaResearch Questions
PepsiCo India CaseAnalysis
Tata Motors CaseAnalysis
ConclusionSummary & InsightsProposition & Future Research
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IndiaIndia: emerging market and consumer changeLarge Urban Sector, Larger Rural SectorLack of Transportation InfrastructureObsolete Practices in farming, manufacturing etc…
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Research Questions
Are there specific strategies that could be adopted for emerging markets like India?
Any general characteristics for emerging markets like India?
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PepsiCo India Case Study
Partnerships for success
Supply Chain
Challenges (Rural Sector) Procurement ManufacturingDistribution
ProcurementManufacturing & Production DistributionPlanning
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Analysis: PepsiCo India
PepsiCo India
Non-competitor CPG company
Distribution network
Outsourced production & distribution network
Urb
an a
nd s
ubur
ban
regi
ons
Rur
al
regi
ons
Experimental Partnership
Collaborative Partnership
Entrepreneurial Partnership
Large individual consolidator
Large supply company
Entrepreneur
Raw material imports
Small scale farmers or suppliers (individuals)
Customers
Suppliers Manufacturing & Production Distribution
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Tata Motors Case Study
Vertical IntegrationTata GroupSubsidiaries
ChallengesLack of skilled labor
Bad infrastructureUnreliable Supply
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Tata Motors Case Study
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Analysis: Tata Motors
Tata Motors Supply ChainRegular Framework
Adaptations to reduce CostsProduct DesignVertical Integration advantagesMix of US/Japanese practicesGovernment Support
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Summary
Successful strategies adopted
Partnerships to overcome fragmentationAlliances with multinationalsPromotion of entrepreneurs to overcome rural distribution woes
Key observations
Partnerships and collaborations customize supply chainsVertical Integration
Successful strategies adopted
Repetition of existing successful strategiesPart of Tata GroupCost reducing designUtilization of government supportSelective supplier base
Inherent problems
FragmentationObsolete practices and blue collared skilled labor shortageLack of transportation infrastructure
Challenges[1]
Transportation infrastructureSupplier unreliabilityLack of blue collar skilled workforce
Challenges
Obsolete practices of 3rd party bottlersEconomic conditions of rural IndiaInefficient retail practicesRural distribution fragmentation
Cross AnalysisTata Motors AnalysisPepsiCo India Analysis
[1] Challenges are characteristic of the automotive industry as a whole
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Key InsightsFragmentationVertical IntegrationPartnerships or Collaborations customize supply chains
Suppliers (upstream)
Manufacturing & Production
Distribution(downstream)
Experimental Partnership
Collaborative Partnership
Entrepreneurial Partnership
Partnerships situated at various points across the PepsiCo India supply chain
Proposition
Trends in emerging markets – further research
Ideal change
Emerging market variant
Developed market variant
Frag
men
tatio
n
Time
High
Limited Advanced
Low
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Thank You
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