SILVIO NAPOLI AT SCHINDLER INDIA (A)

Schindler was established in 1874 in Switzerland by Robert Schindler. In 1889, the

elevators has been started to manuIacture by company. Then, AlIred N. Schindler,
Iourth generation the Iamily, transIormed the Iirm Irom manuIacturing Company to
customer-oriented service company. Schindler is the leader in supplying escalators
and second largest Swiss based company which supplies elevator. CEO, AlIred
Schindler decided to enter the India market since it is a growing market. ThereIore,
Silvio Napoli, who is a graduate oI Harvard MBA and head oI the corporate
planning oI the company, charged Ior developing a strategic plan in India.
Since 1996, Schindler has not direct operations in India except distribution
agreement with ECE. AIter terminating it, they had a technical collaboration with
Bharat Bijlee LTD. (BBL). Then, the negotiations between BBL and Schindler
resulted badly and that agreement was terminated as well. AIterwards, in order to
understand the India market, they agreed with Boston Consulting Group. They
narrowed 34 potential partners to 8 and it was understood that the candidates were
not appropriate Ior the partnership. Thus, decisions changed to start a wholly
owned company in India.
Silvio Napoli was a young man with a Iamily. These properties made AlIred
Schindler`s mind to choose Napoli as a GM Ior Indian company. He thought that
only a young person can adapt himselI to a diIIerent culture and he relies on him
Ior making strategic plans. I think, he is a well-educated man with an orderly
Iamily liIe. As he is younger than the others, I agree that he can adapt easily but he
is lack oI experience in some aspects. Since his colleagues mentioned he is
impatient, hard driving and very communicative and these properties are not
acceptable in Indian culture.
Napoli, Iirst built a management team in India. Some oI them were Irom the
elevator industry and some oI them were not. Thus, Napoli arranged some meetings
Ior explaining them the history and activities oI Schindler and also touched upon
elevator industry a little bit. As their relations developed, the team started to
understand that Napoli is diIIerent Irom Indians. He is so aggressive but it is
important to be both aggressive and patient. As one oI his colleagues mentioned
'He wants everything done yesterday. And in India, things don`t get done
yesterday. Also, he deIined the strategy as entering market with standardized
products and outsourcing the key manuIacturing parts and logistics Iunctions in
order to lower the costs. He set a goal which was selling 50 units Ior the Iirst year
and then winning 20 oI market share in 5 years. However, his plans did not work
as he wanted and they could not sell even a unit in 8 months. As we consider these
circumstances, Napoli`s perIormance Ior seven months was not so well but it is
hard to adapt to a new environment and also he Iaced with some diIIiculties about
his Iamily and Schindler`s company culture was really diIIerent than Indian

companies. Thus, I guess with taking right actions he will be successIul in the
Iuture. Things will go right when he settles down properly and will start to
understand Indian culture better.
Silvio Napoli has challenged with some problems in that seven months. First, he
was going to planning to sell standard products in India but the demand Ior
customized elevators were much more than the standard ones. Another problem
was about costs. The actual cost oI transporting was 30 higher than the expected
cost. Lastly, the Indian government increased the rates oI import duties. The Iirst
challenge can be solved by producing customized products to meet the demands oI
customers. As it is cited, there will be service challenges but improving services
will be a better solution than not producing customized products. Since, most oI the
customers demanded glass wall elevator, Schindler should respond to that. I believe
that Napoli should be happy instead oI worrying about his strategy because his
plans overwhelmed by the problems they Iaced so it is time to make some changes.
As a recommendation Ior the second challenge which was the increased
transportation cost and limited technical cooperation Irom European plants, the
company should acquire an existing manuIacturer and distributor. It will make
them earn more proIit since they will have a strong local knowledge and also an
established service base. Also, they will have the opportunity to improve technical
equipment as they have an established plant. They should develop their sales and
marketing Iorces. This will yield to increase revenue and they can reach their goals
to win 20 market share within Iive years by using local knowledge. Since, Napoli
could not adopt their culture very well, and then he should cooperate with a
cognizant.
In conclusion, as I mentioned above Napoli changed both his plan and his mind. He
is too aggressive Ior Indian culture. He has to be sure about where he is and adapts
the environmental issues. In order to be successIul in a country, the most important
thing is to understand the culture and traditions oI that country. He started with a
too certain plan but it should be more Ilexible since Indians are not so disciplined
as Swiss people. Thus, buying an existing company will make them act according
to local knowledge. Since, Indian people are eligible to produce these kinds oI
electronic equipment; they can manuIacture parts locally instead oI importing them
Irom Europe. Consequently, they will burst Irom the import rates oI government
regulations and both transportation costs. Reduction oI costs will increase revenue
so Napoli will reach one oI his goals. Also, they have to customize their products
partially according to the demand. Since they are custom-oriented company, they
should meet the demands oI their customers and they have to provide qualiIied
service. They can customize their basic products up to a point and have the win to
win situation. Customers will have what they want and Schindler will build a
reputation and brand awareness in India. As to conclude I believe that the strategy
oI Napoli should be revised and the rights actions such as my recommendation can
be applied to complete their goals.