Golazo Technology Company Global Business - Case Study Example

GLOBAL BUSINES PLAN Golazo Technology Company is an Information Technology based firmthat is set up using state-of-the-art, evolving technology, modern theme code that sums up a far greater number of functions in the smallest screen real estate possible. This is achieved by using, for example, JavaScript, to enable slide outs, CSS for responsive, screen adjustable design etc. Since all software could use a robust guide user-interface, there ought to predictably be a high demand for the product, especially if the quality is controlled. Country Risk Analysis: India Risk assessment and analysis becomes extremely important in the context of a foreign country. This is because there may be peripheral factors that would otherwise get neglected or overseen, or even underestimated. Such a risk analysis must take into account a number of sectors, aspects, time periods and other nuances. Political, Legal, and Regulatory Risks When it comes to political risks, India comes across as highly stable within the greater sub continental region, fraught with turmoil. The country is the worlds biggest democracy and its rich democratic tradition has held strong since its independence. However, the legal landscape in the country is highly uncertain. Governed by a coalition of smaller, regional parties, the legislative process moves slowly. Liberalization has come through at a very gradual pace, however, in recent years; US companies like Starbucks, Walmart, McDonalds, KFC etc. have all entered the retail sphere. Tech companies like IBM, Microsoft, Apple, Google etc. have been operating in India for over some time. Regulatory risks are perhaps the most pronounced. This can be attributed to an aging bureaucracy and temporal shifts in policy. Exchange & Repatriation The country has been ranked as the third largest economy in terms of purchasing power parity, and as such, the Indian currency, the rupee is highly stabilized against the US dollar. While depreciation in the value of rupee has been a persistent concern, such trends are usually concentrated to a period of a few weeks every decade. The exchange and repatriation systems are well oiled owing to the number of foreign firms already in operation, and the diaspora all over the world. In recent years, the Indian government has actively sought foreign direct investments to boost a slowing rate of growth. The government allows for foreign accounts to be maintained in the US dollar, attracting a growth rate of over 6%. Deposits are also insured by the Indian version of the Fed (the Reserve Bank of India). Numerous methods for repatriation exist, including the common international wire transfer, Western Union, international cheques etc. Accordingly, these risks can be managed by maintaining a lower average account balance, repatriation at regular intervals etc. In the case of our business, owing to the electronic nature of it, substantial investment in equipment will not be required. Competitive Risk Assessment The country has a large technological sector, attracting and sustaining a very large base of highly skilled talent. (Kumar, 2009) A very large number of local and regional players are also operational, many of whom are comparable to our venture in size. The competitive risk assessment weighs against our decision largely; nonetheless, most of the domestic firms do not have adequate exposure to international markets. At the same time, very few firms adhere to international coding standards (for example, W3C). Therefore, if we can stress on quality enough, these risks can be managed. Taxation and Double Taxation Risks India has a double taxation treaty with the United States, accordingly, India sourced income while taxed in that country will not be taxed a second time in the United States. Likewise, US-based income will be entirely exempt. While the consultancy portion of the business stands to be affected by the double taxation treaty, theme code software will be hosted in another country, alleviating the burden of tax to a certain degree. Market Risks Market risks related to the price of the product are highly pronounced because there is no dearth of cheaper alternatives. The product in itself is highly secure, because international standards of quality are adhered to and the product is quite advanced when compared to other contemporary products. The promotion poses fewer risks because we stand to gain from the international nature of our operations. Besides, the quality of coding and availability of features will allow for a smooth promotion experience. The place in itself, especially South India and the region around Bangalore, is replete with software companies. If the region is not managed well, there is a chance that we may be overwhelmed. So as to curb these perils we have to precipitate product differentiation. (Peng, 2009) Distribution and Supply Chain Risks Supply chain risks, closely approximated in this case as risks associated with the availability of labor are less possible to be of any implication. This is because there is a ready availability of cheap and highly skilled labor. Product distribution will be carried out by the parent organization, shielding it from localized risks. Physical and Environmental Challenges Physical and environmental challenges can escalate if we choose to do things differently, and beyond the periphery of the technology hub that the region around Bangalore has become. In that region, however, the laws are streamlined for an easy startup and continuation of operations. Keys to Realization The business triumph of this tech-biz company would be based on 1. Provision of information technology services that are more powerful than the competitors’ 2. Integration and application of varied classes and categories of products so as to provide various variety of program designs. 3. Amplified network on international business influences. This is owing to the research outcomes which recognized competitors, deprived mix of software programmers and worldwide commercial network being the foremost draw backs on the software businesses. Objectives 1. To attain sales of $ 200,000 in the first year of operation and $800,000 by the close of year five of operation. 2. To increase the market by 35% every year by means of internet technology. 3. To form and institute a new market position by the fifth year courtesy of the use of interactive software development system and three dimensional system development documents. SWOT Perhaps the biggest strength of the target country is the reduced cost of doing business, in particular, cheaper labor costs; an environment where technological business can thrive irrespective of the relative disorder in other industries, as well as a thriving market for end products as far as theme code software is concerned. Weaknesses involved may include disparity when it comes to competing with local businesses, limited regional applicability as far as startups are concerned, etc. Opportunities are mostly available in the area of development because neither the market, nor the industrial scenario as far as technology is concerned, is saturated. Besides, given the availability of credit, access to a very large pool of talented workers can enable a western firm to gain significant competitive advantage. Threats would be constricted to competition for the most part, which is likely to get quite severe in the years to come. Native companies are accorded with a number of provisions when it comes to competing with foreign companies. Competitive Edge This business plan will facilitate the firm to attain a competitive gain over other small firms, middle rated companies as well as the established software development and programming firms. This is for the reason that; the business will comprise of a rich combination of current programmers who are computer effectual to provide the up-to-date digital software and programming resolutions. So it will be dissimilar from most businesses who still bring on board old programmers who cannot straightforwardly provide 3-D resolutions on computer programming. In the preliminary stages of application, the business will begin with the use of Java and Oracle as the main platforms for developing the end products. For improved compatibility of prevailing personnel, the plan endorses that the business be accommodative for the cost of training, superficially as well as increase on-sight developments and workshops. This will make personnel face negligible tests with the innovative digital structure upon which the firm relies on for improved competitiveness. Personnel Plan The table below shows the estimated personnel expenses for the five years commercial strategy. Year 1 Year 2 Year 3 Year 4 Year 5 Chief Programmers $20,000 $36,000 $52,000 $70,000 $95,000 Clerical Staff $15,000 $30,000 $45,000 $65,000 $85,000 Software Architectural Analysts $40,000 $75,000 $110,000 $145,000 $180,000 Total people 6 8 12 15 20 Total Payroll $75,000 $141,000 $207,000 $280,000 $350,000 Financial Plan This business blueprint would put emphasis on commercial progress as well as technology. In this respect, cash flows are anticipated to be amplified as the firm navigates through the set five years’ strategy. On the other hand, enough money will be set aside for consultation resolutions. Key Financial Indicators It is projected that the business will gather a continuous gross margins through and over the next five years of the business blueprint timeline. Nevertheless, sales, record turnover and operational expenses are projected to escalate proportionally while debit collection times are expected to decrease as the firm navigates through the five-year blueprint. Anticipated earnings and Losses Taking into consideration the ascending number of annual clienteles, product sales and Cash flows as well as fixed direct costs on software development amenities obtainable, as evidenced in the preceding parts of this blueprint, the business is anticipated to comprehend increasing revenues with trifling losses. To begin with, there may be not as much of income but as the strategy gears up, the company’s anticipated Cash flows will be achieved. These will be replicated better in the company’s balance sheet together with the revenue and loss financial records. Business Assessment There will be implementation of innumerable valuation implements so as to uncover the emergent business hazards and openings for future developments. Risk Assessment- This implement will benefit the business in analyzing its targeted market, commercial, finance, merchandises or amenities and any perils associated with the blueprint’s implementation. From this step; the company will be able to establish desirable yardsticks which will best stabilize the emergent tests for actual comprehension of the planned targets. Growth Assessment- So as to comprehend the 35% annual business progress, the firm will contemplate the growth approach which will guarantee that the human, invention and marketing proportions of the company’s operation zones are well taken care of henceforward leading to improved revenues margins. Improved Business Bureau Evaluation- For both nationwide and worldwide assessment, the business will endeavor towards achieving the Business bureau evaluation. In this regard, the company will guarantee that its operation times are summarized, possess the proficiency licenses, promote its services, diminish the complaint capacity, honor obligations and sufficient establishment of information for the business bureau rating. (McManus & Moitra, 2007) Employee Incentive Plan In this blueprint, personnel will be awarded incentives so as to inspire them on delivering quality output. This will be done founded on the breakdown on sales, commissions and in-house roles in the software development projects. The standards used in this proposal will avoid successive issuance of largesse to the same worker, instead it would be founded on a fair-minded list of benchmarks, will substitute monthly motivations and will encourage remarks from the staffs on how to progress the company as well as incentive suite. This will guarantee that the company comprehend higher worker retention thus guaranteed of constant delivery of value services in the blueprint. In order to tactically distinguish the amenities, this business blueprint commends the usage of super speed computers with fitted up to date programs that operate on the Java, JavaScript and Oracle platforms. This will allow effectual establishment of the new cooperative media. Adding to that, the business will be sustained on the market vanguard through exhaustive and all-encompassing on market and knowledge on three-D designs. Market Analysis Summery This business blueprint contemplates both the internal and worldwide markets within which the company would function. Even if the company covers and works with plentiful clienteles, a close analysis and thoughtfulness of these customers will be founded on the tendencies in sales as well as other client involvement data in the first months of company operations. Subsequent of the four groupings of customers in this industry, the table shows the predicted proportions of clienteles over the next five-year period. This information accommodated for the annual 35% market growth and founded on the past client findings. As illustrated, Telecommunication companies take the highest market share; the firm will quintessence both on advertising and marketing determinations towards them. Same efforts on the continuing groups of clienteles will highly hinge on creation of evocative rapport and appropriate proposal rejoinders and action. In this data, the annual growth viewpoint is 35%. Potential client Year 1 Year 2 Year 3 Year 4 Year 5 Yearly Growth Telecommunication Industry 200,000 250,000 312,500 390,625 488,281 35% System Developers 7,000 8,750 10,937 13,672 17,090 35% Both Non-governmental and Governmental agencies. 20,000 25,000 31,250 39,063 48,828 35% Contractors and Sub-contractors 5000 6,250 7,812 9,766 12,207 35% Total 232,000 290,000 362,499 453,126 566,406 35% Service Business Breakdown The business all over the country fundamentally encompasses insignificant to mid-sized corporations specializing in a particular type of programming service. Nevertheless, there is also presence of large corporations which often center on the design of large amenities used for industrialized or commercial tenacities. This firm will face opposition from the large and established firms since such tech companies have the mighty capital base for upholding and catching up with the state-of-the-art technologies in the industry. In addition, it is the contenders firms which have long-drawn-out business procedures even to the worldwide market. Sales strategy With extraordinary services obtainable to consumers, it is anticipated that the business will realize respectable sales. To attain such sales, the firm should have a virtuous public image as well as recommendations. In attaining good base for recommendations, the company will focus on extending their services, in an attractive method, to as many clienteles as conceivable. In this regard, the staff as well as the administration team will strive to provide positive client experience which will aid the firm get more recognition and acquire more market share. In addition, it will make the firm have noble customer affiliation; a fact that makes customers come back for additional services in the impending times as well as refer other new clienteles to the firm. Financing Making a case with finance groups like the Financial Technologies India to pump in some cash in terms of direct financing and some as part of extended shares needs a real convincing. But with the well laid out blueprint, the financial group emerges as the best viable partner in India and therefore joins the venture aiming to develop its own market share and spread its partnership and grip of the local Indian financial market. Exit Strategy Considering the circumstances of where the company has to exit the Indian market, the exit strategy of handing over to a joint venture partner stands out to be more viable since as outlined in the blueprint, the venture in itself is so massive and requires much effort that it would be with heavy hearts that the employees will be seeing the company they have worked so hard to develop close down but would rather have the occurrence of the venture being taken over by a joint partner. Final Recommendations Given all the findings and studies analyzed, II can recommend the proceeding of this venture (Golazo Technology Company) since it is one of the most ambitious projects that aims to diversify and replicate the World’s famous Silicon Valley companies albeit now in a different market area (India). The blueprint has clearly established and spelt out all the possible circumstances and opportunities possible in order to make the venture realistic. References Kumar, R. (2009). The Development of the Software Industry in Post reform India: Comparative Regional Experiences in Tamil Nadu, Andhra Pradesh, and Kerala. Cambria Press. McManus, J., Li, M. & Moitra, D. (2007). China and India: opportunities and threats for the global software industry. Chandos. Peng, M. W. (2009). Global strategy. Mason, Ohio: South-Western Cengage Learning. Read More