Godrej Sbu
Does a Strategic Business Unit changes the organization in adversity? – A case study of Godrej Consumer Products
During the recent period of World financial Crisis, economies reeled under recession and downturn. Sectoral performance in sales and operations declined leading to unprecedented series of lay offs in organizations affecting employment , income levels and consumption There was a fall in growth rates in India, in spite of a wide claim that the economy is operating much in a protected environment than the other economies of the world. However, some organizations saw this adversity as an opportunity and have been able to innovate and introduce new offerings that excite customers With the launch of new products and cost saving initiatives in individual divisions and strategic business units were created within an organization to improve operations and performance on a consolidated basis. In the business parlance , Strategic Business Unit (SBU ) means “an independent work unit within an organization that thrives on its distinctive business capabilities in a competitive market place The case study of Godrej Consumer Products Ltd (GCPL) has been presented here to highlight the strategies followed in its fast growing FMCG division as a SBU
I. A brief study of the economy and FMCG market in India
The Indian economy grew at a much slower rate during 2008-09 than the previous year when it was 9 % when the economy was considered robust. In fact the robust growth demonstrated by the economy over the previous 5 years has led to average income of an Indian increasing vastly to over Rs.30, 000 p.a. in 2008-09 from a little under Rs.19, 000 p.a in 2002-03.Quoting a study by McKinsey Global Institute (MGI) “as rapid socio – economic changes sweep across India,, the economy is witnessing the creation of many new markets and an expansion of existing ones. Estimates indicate that over 300 million people will move up from the category of rural poor to
During the recent period of World financial Crisis, economies reeled under recession and downturn. Sectoral performance in sales and operations declined leading to unprecedented series of lay offs in organizations affecting employment , income levels and consumption There was a fall in growth rates in India, in spite of a wide claim that the economy is operating much in a protected environment than the other economies of the world. However, some organizations saw this adversity as an opportunity and have been able to innovate and introduce new offerings that excite customers With the launch of new products and cost saving initiatives in individual divisions and strategic business units were created within an organization to improve operations and performance on a consolidated basis. In the business parlance , Strategic Business Unit (SBU ) means “an independent work unit within an organization that thrives on its distinctive business capabilities in a competitive market place The case study of Godrej Consumer Products Ltd (GCPL) has been presented here to highlight the strategies followed in its fast growing FMCG division as a SBU
I. A brief study of the economy and FMCG market in India
The Indian economy grew at a much slower rate during 2008-09 than the previous year when it was 9 % when the economy was considered robust. In fact the robust growth demonstrated by the economy over the previous 5 years has led to average income of an Indian increasing vastly to over Rs.30, 000 p.a. in 2008-09 from a little under Rs.19, 000 p.a in 2002-03.Quoting a study by McKinsey Global Institute (MGI) “as rapid socio – economic changes sweep across India,, the economy is witnessing the creation of many new markets and an expansion of existing ones. Estimates indicate that over 300 million people will move up from the category of rural poor to