INDUSTRY OVERVIEW & COMPANY PROFILE

1.1 OVERVIEW OF INDUSTRY AS A WHOLE

The Indian IT industry is undoubtedly, a shining jewel in the country’s crown.

The achievements of our IT companies have earned us the respect of the most

developed nations of the world. The skills, ingenuity, dedication and drive of our young

IT professionals are acknowledged worldwide. Today, there will hardly be a company

of any stature anywhere in the globe where Indian IT professionals are not making a

stellar contribution.

 However, most of the growth in IT has been in the software services and support

segment. If we are going to continue our thrust and growth in the IT industry, it is

imperative that we develop a robust hardware industry and emerge as an important

destination for high end product development. While software development has been

the more visible face of our IT industry, we cannot deny the fact that ultimately it is

‘hardware’ that runs the ‘software’. While ‘hardware’ is of no use without software, the

converse is also equally true.

 

The development of a vibrant ‘hardware’ industry in India has been lagging behind on

account of various factors. The underlying fact is simple. Unless companies are able to

manufacture products that can compete with the world’s best in quality and unless they

manufacture in volumes that make them cost efficient and globally competitive, they

will not survive. A major bottleneck in the development of the ‘hardware’ industry has

been the lack of a strong local component industry. It is my humble suggestion that the

government, both at national and state levels do everything in their power to promote

such industries so that by the end of this decade, we can have a strong and world-class

component industry.

we have a long way to go to catch up with Taiwan or China or even Malaysia, but I

believe with the right encouragement we can develop a strong ‘hardware’ industry. I

must make a point here about the viability of ‘hardware’ as an industry in India. It is

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myth that the ‘hardware’ business is not profitable. This point of view has been largely

perpetrated on account of the large number of players who made half hearted or weak

attempts to enter this business.

 

To be a success in the hardware business requires both vision and grit. I often give

the example of company D-Link (India) which, starting out as a small manufacturer of

modems has grown to become a Rs. 2 billion company with a product range that

extends from modems to routers. But success has not come easy. We have made

massive investments in both plant and people and have spared no effort in getting the

best of equipment and talent. More importantly, we have set up a strong R&D backbone

to support our manufacturing. Which brings me to the next point: the importance of

R&D?

 Technology in the IT space changes very rapidly. Technological obsolescence is not

just a ‘cliché’- it has thrown strong companies out of business. In this scenario, the

importance of R&D can hardly be over emphasized. It is vital that those who venture

into ‘hardware’ industry are seized of this fact. Only through strong R&D can

manufacturers ensure continuous product improvements and keep their offerings truly

‘state-of-the-art’.

Over a period of time, with a strong R&D base, Indian companies can look forward to

developing innovative products and own Intellectual Property Rights (IPR’s) on such

products.

 I dream of the day, and I believe it’s not too far away, when technology for products

developed by Indian companies would be licensed to global manufacturers as well as

innovative products manufactured by Indian companies would be available worldwide.

The state of our hardware industry and R&D infrastructure is quite the same as that of

the software industry a couple of decades ago. Visionaries like Narayanmurthy and

Azim Premji have shown that we have the potential to achieve global stature in a

business. Extending our sights a little further, we have seen how a Ranbaxy or Dr.

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Reddy’s have got recognition for Indian R&D in the Pharma industry. There is no

reason, therefore, why we can’t develop a strong R&D base in the IT industry as well.

 The development of a strong hardware industry base would also go a long way in

increasing the IT penetration in our country, which is still very low.

 I do believe that we have all the elements to become a significant player in both IT

hardware as well as R&D. As IT penetration increases, as organizations across the

country network, as we build more robust IT backbones in various spheres of our

activity, we will need more and more hardware. Rather than be totally dependent on

imports, we need to have a thriving component and hardware industry backed by strong

R&D. Along with our strength in software services, it will provide another cornerstone

towards India truly becoming a global IT superpower.

 In India, laments Raj Saraf, chairman and managing director of Zenith Computers,

there are a lot of restrictions for the hardware industry. “The software industry has

grown in leaps and bounds simply because there have been no restrictions. On the other

hand, even if I do manufacture in an SEZ in India, I cannot sell my products in the

domestic market.

The government says everything should be exported. But it should realize that the

industry will always flock to an area where there are least restrictions.” The government

can also take a cue from the fact that if the industry is allowed to grow to three times the

size it currently is today, it can earn more tax from its revenues.

The manufacturing industry in India also suffers from a lack of proper environmental

standards. With environmental concerns mainly ignored or casually overlooked by Indian

corporate, MNCs desist from setting up manufacturing bases here since there is no

compliance with ISO 14000 standards, which deal with environmental issues.

On the design front too, there are lots of opportunities left to be explored. Design exports

are a $7 billion opportunity in areas like embedded systems and wireless

telecommunications. While Indian firms do some work on hardware design exports,

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many unfortunately show this as software exports to avoid tax. Fact is, some experts say

a robust design sector could play a huge role in bringing down PC prices too a significant

reason why PC penetration remains low in India. For example, on a CPU that costs $150,

the material cost is not even $4. Adds Deshpande, “If we can get a design, like say a PII,

made either by ourselves or if we can get the government to buy out a design and start

manufacturing here this would bring costs down substantially in PCs.”

1.2 PROFILE OF THE ORGANIZATION

HCL Info systems are no flash in the Information Technology pan. Founded in

1976, the firm has climbed into pantheon of India's corporate giants on the strength of its

IT products and services. HCL Infosystems specializes in IT hardware (PC's and servers,

as well as networking, imaging and communications products), and system integration

services serving the domestic Indian market. In addition to its consumer products, the

company provides commercial IT products, facilities management, network services, and

IT security services for clients in such industries as government, financial services, and

education. HCL Corporation owns significant stakes in HCL Infosystems (about 44%)

and sister company HCL Technologies.

HCL Infosystems Ltd, a listed subsidiary of HCL, is an India-based hardware and

systems integrator. It claims a presence in 170 locations and 300 service centres. Its

manufacturing facilities are based in Chennai, Pondicherry and Uttarakhand .Its

headquarters is in Noida.

HCL Peripherals (A Unit of HCL Info systems Limited) Founded in the year 1983, has

established itself as a leading manufacturer of computer peripherals in India,

encompassing Display Products, Thin Client solutions, Information and Interactive

Kiosks. HCL Peripherals has two Manufacturing facilities, one in Pondicherry

(Electronics) and the other in Chennai (Mechanical) .The Company has been accredited

with ISO 9001:2000, ISO 14001, TS 16949 and ISO 13485.

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1.2.1 HISTORY

HCL Info systems Ltd is one of the pioneers in the Indian IT market, with its origins in

1976. For over quarter of a century, we have developed and implemented solutions for

multiple market segments, across a range of technologies in India. We have been in the

forefront in introducing new technologies and solutions. The highlights of the HCL saga

are summarized below:

Y E AR H I G H L I G H T S

1976

- Foundation of the Company laid

- Introduces microcomputer-based programmable calculators with wide

acceptance in the scientific / education community

1977

- Launch of the first microcomputer-based commercial computer with ROM

-based Basic interpreter

- Unavailability of programming skills with customers results in HCL

developing bespoke applications for their customers

1980 - Formation of Far East Computers Ltd., a pioneer in the Singapore IT

market, for SI (System Integration) solutions

1983

- HCL launches an aggressive advertisement campaign with the theme ' even

a typist can operate' to make the usage of computers popular in the SME

(Small & Medium Enterprises) segment. This proposition involved menu-

based applications for the first time, to increase ease of operations. The

response to the advertisement was phenomenal.

-HCL develops special program generators to speed up the development of

applications

1986 - Zonal offices of banks and general insurance companies adopt

computerization

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- Purchase specifications demand the availability of RDBMS products on

the supplied solution (Unify, Oracle). HCL arranges for such products to be

ported to its platform.

- HCL assists customers to migrate from flat-file based systems to RDBMS

1991

- HCL enters into a joint venture with Hewlett Packard

- HP assists HCL to introduce new services: Systems Integration, IT

consulting, packaged support services ( basic line, team line )

1994 - HCL acquires and executes the first offshore project from IBM Thailand

- HCL sets up core group to define software development methodologies

1995

- Starts execution of Information System Planning projects

- Execution projects for Germany and Australia

- Begins Help desk services

1996

- Sets up the STP ( Software Technology Park ) at Chennai to execute

software projects for international customers

- Becomes national integration partner for SAP

1997- Kolkata and Noida STPs set up

- HCL buys back HP stake in HCL Hewlett Packard

1998 - Chennai and Coimbatore development facilities get ISO 9001 certification

1999

- Acquires and sets up fully owned subsidiaries in USA and UK

- Sets up fully owned subsidiary in Australia

- HCL ties up with Broadvision as an integration partner

2000 - Sets up fully owned subsidiary in Australia

- Chennai and Coimbatore development facilities get SEI Level 4

certification

- Bags Award for Top PC Vendor In India

- Becomes the 1st IT Company to be recommended for latest version of ISO

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9001 : 2000

- Bags MAIT's Award for Business Excellence

- Rated as No. 1 IT Group in India

2001-Launched Pentium IV PCs at below Rs 40,000

-IDC rated HCL Infosystems as No. 1 Desktop PC Company of 2001

2002

-Declared as Top PC Vendor by Dataquest

-HCL Infosystems & Sun Microsystems enters into a Enterprise Distribution

Agreement

- Realigns businesses, increasing focus on domestic IT, Communications &

Imaging products, solutions & related services

2003

- Became the first vendor to register sales of 50,000 PCs in a quarter

- First Indian company to be numero uno in the commercial PC market

- Enters into partnership with AMD

- Launched Home PC for Rs 19,999

2004

- 1st to announce PC price cut in India, post duty reduction, offers Ezeebee

at Rs. 17990

- Maintains No.1 position in the Desktop PC segment for year 2003

- Becomes the 1st company to cross 1 lac unit milestone in the Indian

Desktop PC market

- Partners with Union Bank to make PCs more affordable, introduces lowest

ever EMI for PC in India

- Registers a market share of 13.7% to become No.1 Desktop PC company

for year 2004

- Crosses the landmark of $ 1 billion in revenue in just nine months

2005 - Launch of HCL PC for India, a fully functional PC priced at Rs.9,990/-

- Rated as the No.1 Desktop PC company by IDC India -Dataquest

- 'Best Employer 2005' with five star ratings by IDC India -Dataquest.

- 'The Most Customer Responsive Company 2005'

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-IT Hardware Category by The Economic Times -Avaya Global Connect.

-Top 50 fastest growing Technology Companies in India' & 'Top 500 fastest

Growing Technology Companies in Asia Pacific' by 'Deloitte & Touche'. by

'Deloitte & Touche'

-'7th IETE -Corporate Award 2005' for performance excellence in the field

of Computers & Telecommunication Systems by IETE.

-India 's 'No.1 vendor' for sales of A3 size Toshiba Multi Functional Devices

for the year '04 -'05 by IDC.

-Toshiba 'Super Award 2005 towards business excellence in distribution of

Toshiba Multifunctional products,

-Strategic Partners in Excellence' Award by In focus Corporation for

projectors.

-'Most valued Business Partner' Award for projectors by In focus

Corporation in 2005

2006 - 75, 000+ machines produced in a single month

- HCL Infosystems in partnership with Toshiba expands its retail presence in

India by unveiling 'shop Toshiba'

- HCL Infosystems & Nokia announce a long term distribution strategy

- HCL the leader in Desktops PCs unveils India's first segment specific

range of notebooks brand - 'HCL Laptops'

- IDBI selects HCL as SI partner for 100 branches ICT infrastructure rollout

- HCL Infosystems showcases Computer Solutions for the Rural Markets in

India

- HCL Support wins the DQ Channels-2006 GOLD Award for Best After

Sales Service on a nationwide customer satisfaction survey conducted by

IDC

- HCL Infosystems First in India to Launch the New Generation of High

Performance Server Platforms Powered by Intel Dual - Core Xeon 5000

Processor

- HCL Forms a Strategic Partnership with APPLE to provide Sales &

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Service Support for iPods in India

2008

- HCL Infosystems Ltd has announced that the Company has been awarded

one of the most prestigious contracts for establishing the Punjab

State wide Area Network (PAWAN). HCL's specialized expertise in the

e-governance vertical made it the primary choice for setting up this

backbone infrastructure by Government of Punjab (GOP).

- HCL Infosystems has bagged a 23-million dollar deal to implement IT

infrastructure for the Pan-African e-Network Project, which provides

tele-education and tele-medicine. The project would connect 53

African countries into one network

2009

- HCL Infosystems Ltd has informed that Mr. Nikhil Sinha has been

appointed as an additional Director of the Board of the Company.

- HCL Infosystems announced its venture into partnership with BSNL

for offering low-cost broadband-enabled computers in rural areas.

2010

- PC maker HCL Infosystems on March 26 unveiled its new 'ME Series

40' notebook, priced at Rs. 41,500, on the occasion of Earth Hour

2010. The notebook has BFR concentrations of less than 0.1 per cent,

which makes the product 100 per cent recyclable and

environment-friendly.

VISION STATEMENT:

"Together we create the Enterprises of Tomorrow"

MISSION STATEMENT:

"To provide world-class Information Technology solutions and services

in order to enable our customers to serve their customers better"

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CORE VALUES:

Nothing transforms life like education.

We shall honor all commitments

We shall be committed to Quality, Innovation and Growth in every endeavor

We shall be responsible corporate citizens

QUALITY POLICY:

"We shall deliver defect-free products, services and solutions to meet the requirements

our external and internal customers, the first time, every time."

2.2.2 COMPANY OBJECTIVES

COMPANY MANAGEMENT OBJECTIVES

To fuel initiative and foster activity by allowing individuals freedom of action and

innovation in attaining defined objectives.

COMPANY PEOPLE OBJECTIVES

To help people in HCL Info systems Ltd. share in the company's successes, which

they make possible; to provide job security based on their performance; to

recognize their individual achievements; and help them gain a sense of

satisfaction and accomplishment from their work.

POINTS TO PONDER

Pioneers for the past 26 years in the IT space.

A Home-grow IT Powerhouse.

Leadership through Information Enabling.

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ORGANISATION CHART

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Chairman

Managing Director

Zonal Manager

Regional Manager

Retail Marketing

Territory Manager

Branch Manager

Asstt. Br. Manager

Business Dev. Mgr.

Sales Dev. Mgr.

Operation Channel

Team Manager

Operation Manager

Human Resource

HR Executive Territory Manager

Alternative Channel

Branch Manager

Channel Executive

ALLIANCES AND PARTNERSHIPS:

To provide world-class solutions and services to all our customers, HCL Infosystems

have formed Alliances and Partnerships with leading IT companies worldwide.

HCL Info systems has alliances with global technology leaders like Intel, AMD,

Microsoft, Bull, Toshiba, Nokia, Sun Microsystems, Ericsson, NVIDIA, SAP, Scan soft,

SCO, EMC, Veritas, Citrix, CISCO, Oracle, Computer Associates, RedHat, Infocus,

Duplo, Samsung and Novel

     

MANAGEMENT TEAM:

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Ajai Chowdhry

Co-Founder HCL, Chairman and CEO - HCL Infosystems.

An engineer by training, Ajai Chowdhry is one of the six co-founder

members of HCL, India 's premier IT conglomerate.

J V Ramamurthy

Chief Operating Officer HCL Infosystems Ltd.

J V Ramamurthy has an engineering degree in Electronics &

Communications, from Guindy Engineering College, and a Masters'

degree in Applied Electronics from the Madras Institute of Technology,

both in Chennai.

Rajendra Kumar

Executive Vice President - Frontline Division HCL Infosystems Ltd. Mr.

Rajendra Kumar has been with HCL for over 30 years and has seen HCL

grow from a startup company to a gigantic conglomerate that it is today.

CORPORATE INFORMATION:

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BOARD OF DIRECTORS : Chairman & Chief Executive Officer

Ajai Chowdhry

Whole-time Director

J.V. Ramamurthy

Directors

S. Bhattacharya

D.S. Puri

R.P. Khosla

E.A. Kshirsagar

Anita Ramachandran

T.S. Purushothaman

Narasimhan Jegadeesh

V.N. Koura

COMPANY SECRETARY : Sushil Kumar Jain

AUDITORS : Price Waterhouse NewDelhi

BANKERS : State Bank of India

Canara Bank

HDFC Bank Ltd.

ICICI Bank Ltd.

Standard Chartered Bank

State Bank of Patiala

State Bank of Saurashtra

REGISTERED OFFICE : 806, Siddharth,

96, Nehru Place, New Delhi - 110 019.

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CORPORATE OFFICE : E - 4, 5, 6, Sector XI, Noida - 201 301

(U.P.)

WORKS : R.S. Nos: 34/4 to 34/7 and part of

34/1, Sedarapet, Puducherry - 605 111.

R.S. Nos: 107/5, 6 & 7, Main Road, Sedarapet,

Puducherry - 605 111.

Plot No 78, South Phase, Ambattur

Industrial Estate,Chennai - 600058.

Plot No SPL. A2, Thattanchavadi, Industrial

Area, Puducherry - 605 009.

Plot Nos. 1, 2, 27 & 28, Sector 5, 11E,

Rudrapur, Distt. - Udham Singh Nagar,

Uttarakhand - 263 145.

2.3 PROBLEMS OF THE ORGANIZATION

1) To determine customers level of satisfaction aspire plans with the quality of their

transaction with Info systems Ltd..

2) To evolve a free and fair method of assessing the companies, to ensure fair play

between the competitors and to safeguard the interests of the largely uninformed

customers are the main tasks ahead.

3) The other and equally serious aspect is to ensure that the vast amounts collected

by the electronic items and pension funds are utilized for the welfare of the

people. Though the Government itself would not be the guarantor of the laptop,

desktop and other accessories it is accountable through its regulatory mechanism,

to put in place prudential norms of investment and accounting, revenue

recognition, fair valuation of assets and liabilities, determining necessary margins

towards any contingencies and proper reserves for shrinkage of investments will

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have to be made. Nevertheless, care has to be taken to see that there is not too

much of control and regulation.

4) A certain degree of autonomy in the functioning of electronic items companies

has to be allowed so that they get necessary freedom and space to perform and

excel.

5) As for the existing player, the public sector giant, the Info systems Ltd., the

challenge is one of sustaining the huge growths it has shown in the recent times. It

has to face competition for the first time in its history, particularly in the urban

centers.

6) It has to manage its huge operations more efficiently than at any other time in the

past. It has to think of equipping its personnel (staff and agents) to face

competitors and it may have to think of diversifying its activities to achieve

economies in some areas.

7) As far as the prospective entrants are concerned, the greatest challenge is to

establish their presence in the minds of the public. electronic items, particularly

life electronic items, it is said, is never bought but sold. To convince a large

population, which is comparatively not well informed about the intangible

benefits of electronic items is indeed an onerous task. On top of that, to establish

the brand equity of a new name in a new field is quite a challenge.

8) The second most important challenge facing a new entrant is that of setting up

infrastructure and to reach out to as many areas as possible, since electronic items

is based on probability and the wider the spread, the greater are the chances of

success in maintaining the expense ratios at a reasonable level.

9) Modern life perhaps offers challenges that will be common to all the above.

Improvements in health and longevity, the recent breakthroughs in the mapping of

the human genome and the frequent changes in the economy may have far-

reaching effects on electronic items. Devising products that match the changing

needs of the people and managing the funds in a volatile scenario are two

problems that will have to be tackled by every player in the days to come.

2.4 COMPETITION INFORMATION

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ABOUT HP:

HP is a company unlike any other. HP serve everyone from consumers to small and mid-

sized businesses to enterprises to public sector customers with an extensive portfolio of

market-leading solutions specifically designed to meet the needs of each customer

segment.

Their annual R&D investment of $3.5 billion (USD) fuels the invention of products,

solutions and new technologies. HP produce an average of 11 patents a day worldwide.

HP Labs provides a central research function for the company which is focused on

inventing new technologies to improve their customers' lives, change markets and create

business opportunities.

Millions of people around the world use HP technology every day. HP is:

The largest consumer IT company

The world's largest SMB IT company

A leading enterprise IT company

HP strategy is to offer products, services and solutions that are high tech, low cost and

deliver the best customer experience. HP team of 151,000 employees does business in

more than 170 countries. Revenue reached $86.7 billion for the fiscal year.

All markets served by HP:-

Consumer — leadership in handhelds, notebooks, printers and digital cameras for

rewarding experiences

Small and medium business — market-leading products, solutions and services

for simplified ownership

Enterprise — a full portfolio of leading products and services for building an

Adaptive Enterprise

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Public sector, health & education — experience and alliances for lower costs and

increased efficiencies.

Doing well by doing good

HP is proud of their people, their standards and values, and their deep commitment to

global citizenship. Today they employ new models of engagement and new business and

technology solutions to help more people around the globe to participate in the world

economy via information technology.

Stanford University classmates Bill Hewlett and Dave Packard founded HP in 1939. The

company's first product, built in a Palo Alto garage, was an audio oscillator—an

electronic test instrument used by sound engineers. One of HP's first customers was Walt

Disney Studios, which purchased eight oscillators to develop and test an innovative

sound system for the movie “Fantasia”

HP high-definitions TVs loaded with digital services

The 2006 lineup of HP high-definition digital TVs includes nine affordable LCD, micro

display and plasma models, all of which offer exceptional image accuracy and colors as

well as bright, clear pictures that bring the finest details to life.

Leading the lineup is the 37-inch HP Advanced Digital Media LCD TV, with features

never before available on a television. Viewers can watch high-resolution videos or

slideshows with music, all streamed from their PCs to the TV. The TV also delivers a

rich set of services from a variety of industry partners. Users can view online slideshows

with Snap fish or listen to more than a million songs with Real Networks' Rhapsody,

while film buffs can connect to Cinema Now and Movie Link to watch more than 4,000

Hollywood movies or high-definition videos.

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HP notebooks feature latest in digital entertainment technologies

The four new HP consumer notebook PCs include the latest versions of the award-

winning HP Pavilion dv1000 Series Entertainment Notebook PC and HP Pavilion dv8000

Series Notebook PC, which bridge mobile computing with the latest in digital

entertainment technologies.

In addition to a built-in webcam, the HP dv1000 series includes an updated version of HP

Quick Play, which allows users to watch movies, listen to music and now view photos –

all without a full system boot. The HP dv8000 series is now available with Microsoft

Windows® XP Media Center Edition on select models to watch, record and pause live

TV(1) and easily view, edit and share digital media. The dv8000 series is now available

with HP Ultra Bright View technology – for a similar viewing experience to that of a

plasma or LCD display – and the fastest processor in the AMD Turion™ family.

Zenith computers ltd-

Mr.Rajkumar Saraf has promoted zenith Computers Ltd. & Zenith Infotech Ltd. Zenith

was marginally behind HCL in the home segment with the market share of 4% as

compared to HCL 12.1%. Zenith has always sold on the platform of price. Its tagline

‘MNC quality, Indian prices targets buyers who are price sensitive but are looking for

reliable, branded PC. Thus, it is operating in the narrow price band between assembled

PC’s and lower end brands. Zenith manages to keep its prices low by controlling

overheads & manufacturing costs and having shot term purchase plan for components,

which gives it more flexibility and better rates.

Zenith Launches 'Topper' Laptop For Students

Zenith Computers today announced the launch of "Topper"- a laptop specially designed

and priced for students and faculty. The Topper is a laptop that is not available to the

general buyer, but is being sold exclusively to students through India's highly ranked

educational institutions. Zenith Topper offers a student privilege discount of 15-20

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percent, which students can avail of by producing proof of admission and/or ID card.

Zenith offers Topper in three configurations.

The Zenith Topper One-Up (Model 1C), based on a Mobile Intel Celeron 4.8 GHz

processor with 138 MB DDR PC2100 SDRAM is available at Rs. 55,000;

The Zenith Topper One-Up (Model 1P), based on a Mobile Intel Pentium4 1.8

GHz processor with 128 MB DDR PC2100 SDRAM, is available at Rs. 65,000

And the Zenith Topper Premium Supreme (Model 2P), based on Mobile Intel

Pentium4 3.2 GHz processor with 128 MB DDR PC2100 SDRAM, is available at

Rs.75, 000.

Zenith Computers want an Indian student to feel like a global student. Zenith feel that the

education community will fuel PC growth in India and hence the decision to launch

Topper for this powerful generation."

The Topper has the following features: Sleek round-edge design; smoky silver matte

exterior; extended palm rest area; front side speakers with external volume control;

superior LCD screen clarity; 4 USB ports; 4 additional hot keys; 4-hour battery pack; and

additional messenger carry bag included. Another unique feature is that Topper is

bundled with SAAZ Recovery Manager Security solution that allows the laptop to

instantly recover from data disasters, application problems, OS crashes and user errors

without any complex procedures or technical support.

Zenith Topper is available with over 700 dealers and 125 exclusive retail "Zenith PC

World" stores at convenient locations all over the country. Major engineering schools,

management institutions and IIMs have tied up with Zenith to promote these laptops.

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IBM INDIA

IBM reentered through a joint venture with Tata’s. However, two split in 1999 to chart

separate paths in 1999. IBM has concentrated on being a solution provider to medium

and large business unlike HP COMPAQ who is vigorously chasing the household buyer.

In 2006, it had a value share of 7.7%. This can be attributed to its high products. In

portables, it was the second largest selling brand after Compaq. IBM has manufacturing

base in Pondicherry, which it intends to use as an export hub. It has more then 200

dealers in 48 cities.

2.5 SWOT ANALYSIS

STRENGTHS:

1. HCL strengths are many, to mention a few:

2. Global presence:

3. Its collaborations and joint ventures with international companies such as perot

system, and partnership with world leaders like ericsson, toshiba, nokia, oracle

and microsoft, enable it to bring the best technology available world wide to its

consumers.

4. 24 locations in 16 countries.

5. Fast paced and flexible work culture which provides its employees autonomy to

accomplish the task without much pressure from the higher authorities. Thus,

employees are motivated to give their best to the organisation.

6. The core strength of hcl is the talent and innovativeness of its people which

enables it to provide the “right solution at the right time.”

7. The mass markets handled through a chain of dealers, resellers and retailers

which helps bring technology usage closer to the individual. It has very strong

distribution network.

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8 Its pool of competencies: hardware, software, training, networking, telecom and

system integration.

9. Ability to understand customer's business and offer right technology.

10 Long-standing relationship with customers.

11 An India support & service infrastructure.

12 Best-value-for-money offerings

WEAKNESSES:

1. After sales service.

2. Less promotional campaigns.

3. Insignificant presence in institutional segment.

4. Awareness about our e-broking portal is yet to be created among masses

OPPORTUNITIES:

1. IT industry booming at a rate of 45% every year.

2. Increasing consumer awareness about IT and its use.

3. Tremendous untapped potential of IT products in India.

4. Increasing competition.

5. Tie ups with various MNCs enable to extract their core competencies.

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THREATS:

1. Local assemblers are biggest threat for the company.

2. Entry of mnc’s i.e. ibm, compaq, hp, lenovo, giving direct competition.

3. Govt. instability has long-term repercussions affecting company’s policies & its

growth.

4. Technological shift as a result of research & development. Daily new

technologies are emerging.

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