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External and Industry Environment Analysis, Critical Success Factors. Introduction In general, Indian businesses have done surprisingly well in the present recession and have even been able to thrive. Indian companies are very much the product of the environment that they come out of. The Aditya Birla Group is no exception to this. It has succeeded so far by an emphasis upon the acquisition of market volume. Also, the group continues to emphasize the innovative use of India's primary resource: people. While the country is lacking in infrastructure and is held back by certain social systems, technology has helped it to leapfrog into the 21st century as a major economic player. The Aditya Birla Group has done this not just in the sector of Internet communications technologies, but also across the vast and various sectors that make up the company. In general, it is the opinion of this author that this approach needs to continued and expanded upon.

Company Analysis. Aditya Birla Group is the first truly multinational corporation in Indian business history. Aditya Birla has a yearly fiscal turnover of $ 24 billion USD with a market. The group now has over 100,000 employees in some 27 countries, including Thailand, Laos, Indonesia, the Philippines, Egypt, Canada, Australia, China, the United States, the United Kingdom, Germany, Hungary, Brazil, Italy, France, Luxembourg, Switzerland, Malaysia and South Korea, Bahrain, Bangladesh, Brazil, Egypt, France, Hungary, India, Indonesia, Italy, Myanmar, Philippines, Singapore, Sri Lanka, the United Arab Emirates, and

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Vietnam. The group is very diversified and is the dominant player in all the sectors in which it operates such as viscose staple fibre, metals, cement, viscose filament yarn, branded apparel, carbon black, chemicals, fertilizers, insulators, financial services, telecom, BPO and IT services ("I Love India.com").

The Aditya Birla Group is organized into various subsidiaries that now operate across different sectors of the economy and across the globe. Among these sectors are viscose staple fiber, non-ferrous metals, cements, viscose filament yarns, branded apparels, carbon black, chemicals, retail (under the 'More' brand of supermarkets), fertilizers, chemicals, insulators, financial services, telecom, BPO and IT services. The Aditya Birla Group consists of four major companies. These operate in various different industrial sectors throughout various subsidiaries, joint ventures, etc. These include subsidiaries such as Hindalco, Grasim, Aditya Birla Nuvo, Idea cellular and UltraTech Cement ("Aditya Birla Group") . New companies are rapidly being acquired by the group in an effort to dominate market volume and share.

The Aditya Birla Group is now the world's largest player in the Viscose Staple Fiber industry. The company now operates out of India, Laos, Thailand, Malaysia and China. The group owns the Birla CelluGroup's cement business brand. Aside from viscose staple fiber, the Aditya Birla Group also owns acrylic fiber businesses in Egypt and Thailand. It also has viscose filament yarn businesses and spinning mills at several other locations all over India and South East Asia. The group has pulp and plantation subsidiaries in Canada and has recently invested in plantations in the country of Laos.

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The Aditya Birla group also functions as a major player in the branded garments market in the its home base of India (ibid).

Idea Cellular is now wholly owned by the Aditya Birla Group. Idea Cellular started off as just a joint venture with the Aditya Birla, AT&T and the Tata Group, but the stakes of the remaining partners were eventually acquired by the group. Idea Cellular now accounts for afull third of the group's market capitalization. The company is now headquartered in Mumbai and has pan-Indian as well as international operations (ibid).

SWOT Analysis:

Strengths: Demographic Factors: -Rising disposable income -Urbanization -Low labor costs -Vision of group leadership to compete and thrive in this environment Weaknesses: -Lack of trained personnel at all levels. -Stringent employment and industry laws. -Fragmented approach to human resources. -Taxation hurdle

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-Underdeveloped supply chain -Underdeveloped logistics infrastructure. -Fragmented approach to human resources

Opportunities

Potential for investment. Locational advantage. Sectors with high growth potential. Fastest growing formats. Threats Political issues. Social issues. Inflation. Poor inventory turns and stock availability measures Conclusions from the SWOT The key strengths of the group reflect the surrounding Indian society where rising disposable income, urbanization and low labor costs are fueling Indian growth despite the global recession. The group appears to have the vision and the competitive insights to compete in this market. Unfortunately, the company is also subject to the surrounding weaknesses of Indian society including high taxation, underdeveloped infrastructure and supply chains, a lack of trained people and stringent employment and industry laws and

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traditionally fragmented approaches to human resources. Fortunately, market opportunities are such that development and growth may help the company surmount these odds if the proper human resources measures are engaged. The vision of group leadership to compete and thrive in this environment appears to be more than adequate to meet these challenges. In this way, the potentials for investment and market locational advantages will will allow them to function in sectors with high growth potential. Hopefully, surrounding Indian societal political and social issues, inflation and poor inventory turns and stock availability measures can be overcome.

Human resources are almost always the key component of any company and the Aditya Birla Group is no exception to this maxim. Good human resources management in the future will include the access of good personnel on the front end, use of technology and innovative training techniques during the tenure of the employee's service. In addition, pay incentives such as differentials in salary, performance based reviews and promotions need to be continued, maintained and expanded. Even exit interviews would function to accomplish this. By tapping into the dual strengths of human material and the new Indian potential for technology, the group should be able to overcome the human resources deficits.

Recommendations

In the group's traditional sectors such as heavy industries (e.g. Hindalco), it must be accepted that the free market is not now just a passing phenomenon. This should help concentrate resources upon the acquisition of other potentially profitable business
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opportunities to supplement these when they suffer. According to D. Muthukumaran, Head, Group Corporate Finance of the Aditya Birla Group, Again, volume will play a very critical role...we are seeing a stable to growing trend in the volumes...we expect the trend to continue... According to Muthukumara, Aditya Birla is looking for attractive assets to diversify and continue growth in overall group volume,. Especially in the retail sector ("Economic Times"). In term of Porter's five forces model analyze industry trends. generic strategy, they are dealing specifically the intensity of competitive rivalry by gaining more market volume and therefore keeping down prices. They know that this needs to happen not just in retail, but in all other sectors as well and that this key trend has ensured the group's success in the past and will do so in the future as well. Volume and competitiveness are the group's key points of insight and are necessary to any future recommendations. The focus on these aspects reflects well upon the group's portfolio of businesses and the quality of management. This author's recommendations reflect this, but also include expanding the focus upon employee training to adapt to the new market conditions. Employee actions and attitudes are affected by India's socialist past and constant retraining is necessary to assist the continued transition to the free market economy. This is motivating the purchase of business opportunities in other sectors, including the recent acquisition of Domsjo Fabricare AB within 60 days for a bargain price of $340 million USD. Even as the price of pulp prices have reached recent record heights, Domsjo looked attractive to the group for acquisition due to its use of cutting edge technologies to cut costs. The acquisition helped the Aditya Birla Group to gain control over inputs for the Viscose Staple Fiber

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(VSF) sector of the group. Dissolving grade pulp is used to manufacture VSF and is an effective substitute for cotton or synthetic fibers in the textile business sector (Barman).

Conclusion

In general, Indian businesses have done surprisingly well in the present recession and have even been able to thrive. Indian companies are very much the products of the environment that they come out of. The Aditya Birla Group is no exception to this maxim. It has succeeded so far by an emphasis upon the acquisition of market volume. Also, the group continues to emphasize the innovative use of India's primary resource: people.

While the country is lacking in infrastructure and is held back by certain social systems, technology has helped it to leapfrog into the 21st century as a major economic player. The Aditya Birla Group has done this not just in the sector of Internet communications technologies, but also across the vast and various sectors that make up the company. In general, it is the opinion of this author that this approach needs to continued and expanded upon further . The company is a model for Indian growth and will continue to be this way into the foreseeable future. Its conservative approach while everyone else was overspending has helped it to weather the worldwide recession. It as not only survived but also thrived in this challenging economic environment.

In the 1960's, the groups founder took his operations overseas in order to buck the License Raj back in socialist leaning India. Now, the Aditya Birla Group brings the

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prosperity of the free market back to India and is a world leader in private enterprise. It is a good bet for safe investment and innovation in the fast paced environment in the recessionary market we find ourselves in. Globalization has come to stay and the Aditya Birla Group will undoubtedly lead the way.

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Works Cited "Aditya Birla Group Profile ." Aditya Birla Group. 2011. Web. 2 Jun 2011. <http://www.adityabirla.com/the_group/index.htm>. "Aditya Birla Group India." I Love India.com. 2011. Web. 1 Jun 2011. <http://www.iloveindia.com/economy-of-india/top-50-companies/aditya-birlagroup.html>. Barman, Arijit. "Kumar Birya's science of shopping." Aditya Birla Group. 23 May 2011. Web. 2 Jun 2011. <http://www.adityabirla.com/media/press_reports/20110524_science_of _shopping.html>. "We are on constant lookout for attractive assets: Aditya Birla Group." The Economic Times. ET Mpw, 27 May, 2011. Web. 1 Jun 2011. <http://articles.economictimes.indiatimes.com/2011-0527/news/29589967_1_novelis-hindalco-volumes>.

Student Network Resources Inc. 2003-2011