Internationalization of New Sales Subsidiary

Executive Summary

This report did in order to propose the correct strategies for the execution of the internationalization which is creating a sales subsidiary of Nimali garment which is located in Si Lanka.

The main reason for this is to identify the ways of transferring the knowledge and solutions effectively and efficiently to the new sales subsidiary which is situated in Mumbai India.

The report is included what should be transferred to the new sales subsidiary from the parent or guardian company as well as the utmost appropriate ways of moving them effectively and proficiently.

This report is included the determined opportunities with the correct distribution channels to be able to enhance the security as well as ensure the products are delivered promptly.

Out sourcing is well known as an inexpensive option which is designed for corporation to get the actions done better value as well in a lesser time frame. This report has identified the areas to be outsourced as well the methods to follow to be able to choose best out sourced providers.

Finally better conclusions and recommendations have been provided for the further development of the international markets as well as to the development of the business in order ro achieve the best goals of the Nimali Garment. The Garment can be the main one of the primary, successful and highly profitable company by implementing the strategies which are given in the report.

Table of Contents

1. 0 Introduction

2. 0 Absorptive capacity and Knowledge transfer

2. 1 Sociable context

2. 2 Organizational context

2. 3 Relational context

2. 4 What must be transferred?

2. 5 How to transfer?

3. 0 Source chain for the global standardization strategy

4. 0 Outsourcing

5. 0 Realization and recommendations

6. 0 References

7. 0 Bibliography

1. 0 Introduction

In the first course work, it offers clearly mentioned advantages if internationalization as well the techniques which should be achieved in order to improve the effectiveness and efficiency of the internationalization of the firm. First course work mainly based on new appropriate strategy identification for the business. Because the Nimali garment experienced enough encounters on the current internationalization process, where the garment is exporting t-shirts via sales people to Bangladesh, the garment has decided to set up a sales subsidiary in India since the psychic distance is very low. It has discovered a very profitable as well as the utmost appropriate strategy which is open to the business.

This report is mainly based on the execution of the proposed strategy which is establishing a sales subsidiary in Mumbai. India. This sales subsidiary will be fully controlled and noticed by the headquarters which is located in Katugastota, Sri Lanka. The correct ways to put into practice the strategies are clearly explained throughout the article.

2. 0 Absorptive capacity and Knowledge transfer

Figure: 01 Absorptive Capacity (Kostowa. T, 1999)

Accordingly to the Academy of management Review (Kostowa. T, 1999), there are three levels can be determined in the success of the transnational transfer.

  • Social framework.
  • Organizational context
  • Relational Context

2. 1 Public context

This points out the institutional distance country of the parent company (Mind Quarters which is situated in Sri Lanka) and the receiver device (which is the subsidiary in Mumbai, India). Simply it clarifies the characteristics of the countries as well as the individuals in two countries. When it comes to the Sri Lanka and India, the psychic distance is very low since the both countries are very closer to each other geographically as well as demographically. With regards to the regulatory framework work both countries are experiencing similar kind of regulations because the both countries are following a British isles low. The governance also consisting with similar characteristics to the other person since the way of life of folks is very closer to both countries. Since the both countries rules and regulations with the cultural backgrounds, the people who are in both countries are similar in the attitudes as well in believes. The clothing behaviors and trends are extremely closer due to the similarities in mindsets. The trade regulations and other regulatory framework works are similar and the employees are dealt with in a same manner in both countries.

2. 2 Organizational context

The company is often welcoming the new ideas and enhancements (for cost reduction & etc. ) and also the company is actually giving reward to discover the best ideas which can be helpful for the business. The Nimali garment is often allocating jobs by creating organizations and the users are changing frequently where every staff gets a chance use everyone. The individual tasks are barely found within the organization which should be used in the new sales subsidiary since the Indians are also more towards for the group working. It can help to increase the performances of the new sales subsidiary within minimum amount time frame.

2. 3 Relational context

The Nimali garment is always use the wide open door insurance plan where it motivates the employees to are well as it help to make devoted employees to the business. the friendly working environment help the business to create a mutual bound with the employees. These characteristics is seen in the manufacturing facility as well as in the sales shop in Home country. The older are attended to by exhibiting the respect for the kids s on the other side employees are also tackled in the same way. These qualities can certainly be used in the new sales subsidiary because of the very similar attribute of the countries & most importantly it can help to build an improved relationship between the origination and the employees who are in the new destination. The normal ceremonies are celebrated along as a one family and also sympathies are also shared as a one device because of this the company and the employees are emotionally fastened a one unit and that has been a key drivers for the success of the business. These features should be copy to the new sales subsidiary for the long-term success of the company and for employees' development. Finally it help to make a trust about the business in employees'' minds and Vic versa.

2. 4 What needs to be moved?

As discussed above in the absorptive capacity, the parent or guardian company should transfer its' best practices and technologies which can be fully possessed by the company in order to make the new sales subsidiary to own similar service and characteristics because the controlling part is done by the parent or guardian company. Then your employees will adjust to the company steps as well as the clients will be fascinated easily. The father or mother company has its own unique showroom management system with the advertising patterns in order to make customers believe that they are receiving more value than they are expecting. It'll create an emotional bond on the list of employees and the clients with the business. These should be transferred to the new sales subsidiary as well regarding the employees horizontally to the mother or father company.

2. 5 How to transfer?

After the identification of the areas to be transferred, next process should be to identify the ways to transfer those to the new sales subsidiary. The apparel inventory management system should be unveiled to the new sales subsidiary to manage the inventories effectively to be able to regulate as well concerning monitor it from the father or mother company. It can help to reduce the wastages as well as to make the apparel available from the clients always. This technique can be establish giving a proper training program to the new Indian personnel by sending well experienced and informed team of instructors who may have a good knowledge about the systems from the father or mother company to Indian subsidiary. This will help to transfer the machine as well as the data together. It will be an effective strategy for the business.

On the other hands the company can send a supervisor who has a much better knowledge about the company as well as the business functions to Indian new subsidiary as the supervisor will help to transfer the qualities of the parent company effectively. See your face can closely monitor as well to mentor the new employees in order to make them use to have the features of the parent or guardian company.

3. 0 Resource string for the global standardization strategy

The company has determined the global standardization strategy since it the most appropriate strategy consequently to the garment's current situation. The company can achieve the economies of level with this plan by getting ultimately more advantages.

When it comes to the supply string and the supply chain management of the Nimali garment, the garment has a exporting agent who is exporting clothing to the Bangladesh. If it is come to the new market which is Indian market the company has determined an export agent who is functioning in India since it affordable for the organization. The Prepared source chain for the new sales Subsidiary the following,

As mentioned above the business has its home transport agent who is working with the business from the start and has a good romance between the companies insurance agencies a better understanding about the apparel' operations. After conducting better research about the export brokers, the company has selected General Export Businesses which is owned or operated by the Raj brothers in Mumbai India. That is a well respected company where it offers a secured service better value. This may add more value to the Nimali garment and its new sales subsidiary since it has a good image on the Indians.

After exporting the garment the apparel, the company will outsource a anther Indian home transport provider to be able to trans sport the clothes to warehouse of the Sales subsidiary safely and successfully.

These distribution programs of the Nimali garment and its new sales subsidiary will add more value to the organization and it'll help the efficiency and the efficiency of the travelling of the clothes to the new sales subsidiary.

4. 0 Outsourcing

When it comes to the new internationalization procedure for the Nimali garment, outsourcing is participating in major role since the company is controlling all the activities from the headquarters which is situated in Sri Lanka. Since the garment is a medium size company, out sourcing of the activities always giving more benefits to the organization by reducing the potential risks as well as the obligations because outsourced company is liable for the actions as arranged with the organization.

When it involves the new sales subsidiary the company should outsourced activities such as,

  • Indian home transporter.
  • Export service company.
  • Indian promotional and marketing organization.
  • Showroom infrastructure supplier.
  • Research organization.
  • Employee recruitment and training firm.

The company should choose an Indian local transporter who is trustworthy at a lower cost because the garment doesn't have the capability to have own vehicles section. This will be more beneficial to the business to minimize the costs.

Another major firm that ought to be out sourced is the export agency because the garment does not have its own organization. as mentioned above the garment has picked the most suitable export agency for the requirement.

The company will not be to carry out the marketing and promotional activities when you are in the home country and due compared to that the garment should outsource a specialist marketing company to visit the customers effectively and proficiently. This is necessary to get customers to the new sales subsidiary.

Those are the three main services that ought to be out sourced by the business and other than the aforementioned services the business must have infrastructure provider to satisfy the requirements of the new sales subsidiary, a study agency to conduct researches about the improvement of the new sales subsidiary as well as to identify the new styles to react prior to the competitors to be able to get more competitive advantages and lastly a worker recruit and triang firm to recruit and teach the employees for the further development of the sales subsidiary.

5. 0 Finish and recommendations

The implementation of the new sales subsidiary in Mumbai, India will the business to go for a new set of customers as well concerning raise the market talk about while attaining the clothes' objectives.

A sales subsidiary in India will can be easily integrated with the business's resources and the capabilities as well as the core-competencies. The minimal institutional distance between your home country and the receiver unit really helps to the Nimali garment to lessen the potential risks of heading to the new Indian market by adding a sales subsidiary.

The recognized knowledge and the resources should be transferred with the solutions effectively and successfully since the controllability of the sales subsidiary is in the home plant. Transfer of the above mentioned factors will help to the employees as well as the new sales subsidiary to well set up in the Indian market as a strong competitor.

The continues evaluation and the examination should be achieved in order to remove the potential risks and the flaws of the new sales subsidiary to be profitable as well as to grow in the Indian market because they build good reputation. The uniqueness of the procedures and the products should be further developed in order to get more competitive advantages y getting the utmost use from the opportunities.

The organization should look for the new opportunities as well for new growing options for the garment. The garment should try to open a fresh plant in India with the growth of the sales as well as the market. It can help to reduce the costs further more my eliminating the exporting and transport costs. On the other hand it will be beneficial to go to another destination where it includes similar institutional characteristics. It can help for the continuous development of the apparel as well as finally to achieve its eyesight and the objective by being leader on the market as well as on the market.

6. 0 References

  • Kostova, T. , (1999). 'Transnational Transfer of Strategic Organizational Tactics: A Contextual Point of view', The Academy of Management Review, Vol. 24, No 2, pp. 313

7. 0 Bibliography

  • Kostova, T. , (1999). 'Transnational Copy of Strategic Organizational Tactics: A Contextual Point of view', The Academy of Management Review, Vol. 24, No 2, pp. 312-319
  • Paulina, J. (2013) The role of absorptive capacity [Online], Available: http://onlinelibrary. wiley. com/doi/10. 1002/tie up. 21554/abstract [05 May 2014]
  • Malhotra, A. , Gosain, S. , and El Sawy, O. A. 2005. "Absorptive Capacity Configurations in Resource Chains: Gearing for Partner-Enabled Market Knowledge Creation, " MIS Quarterly (29:1), Mar, pp. 145-187
  • Chen, Ch. J. , 2004. The consequences of knowledge feature, alliance characteristics, and

Absorptive capacity on knowledge transfer performance. R&D Management Vol. 34,

pp. 311-321.

BABM-MDX-07- ICBT KANDY- M00476644Page group 1

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