Utility and Indifference Curve
a curve on a graph (the axes of which represent quantities of two commodities) linking those combinations of quantities which the consumer regards as of equal value is called an indifference curve. All points on the curve give the same level of satisfaction to the consumer as far as goods are concerned.
Kimura Case Study
Case Dilemma: Should Pramtex Ltd. lose huge amount of money to retain an important customer or let them go and focus on new project. Problem Statement: The high pricing and poor customer support for their previous purchase has led Kimura K.K. to call off the future deal with Pramtex Ltd. Will it be possible for the Pramtex’s representatives to persuade them otherwise? Alternate Solutions: Dr. Max Scorse, R&D Head of Pramtex Ltd. should talk to Dr. Gen- Ichi Nomura, Senior R&D advisor of Kimura K.K. who were former graduates of Sydney University, in a one to one meeting. Pramtex Ltd. should provide Kimura K.K. three new Spartacus machines with modified controlling system that would be easier to use along with a higher discount. Also, providing some technicians from Pramtex who can provide on-site technical support at Taiwan. R&D department of Kimura K.K. should be given direct medium of contact to the top level management and President of Pramtex Ltd. to eradicate all the communication barriers and make them feel privileged. Best Solution: Pramtex Ltd. should provide Kimura K.K. three new Spartacus machines with modified controlling system that would be easier to use along with a higher discount. Also, should provide some technicians from Pramtex Ltd. who can provide on-site technical support at Taiwan. Reason: The main issues faced by Kimura K.K. was the higher quoted price by Pramtex Ltd. for Spartacus machine in comparison with Singulus Technologies which was 20% less expensive, as pointed out by Finance Director Mr. Eiji Hashimoto. Another issue was the complexity of Spartacus machine which was termed as the “Rolls Royce” of the turnkey DVD production system which came to light on 12th August when Spartacus machine malfunctioned and none of the in-house technicians could solve the problem. This is the best possible alternative according to us, as this alternative addresses both the major problems faced by Kimura K.K. by providing new Spartacus machines with modified controlling system which made it easier to operate the machine; this innovation was noted by John at Osaka factory, who updated the designers in Sydney. Along with this, some technicians should be provided at Taiwan, to provide technical support on-site. Also, the high quoted price can be resolved by offering Kimura K.K. with a higher discount than previously offered, which would be competitive with the market competitors Singulus Technologies and Marubeni Systems.
HUL Pureit Case
1. What was so compelling for HUL to develop a product like Pureit? What factors accounted for its success? There were two main factors behind the development of a product like Pureit: • The lack of potable water in the majority of rural India. Additionally, the process of boiling water was cumbersome & Resource heavy. • Introduction of a compact water purifier called “Swacch” by the TATA Group. 2. Explain the product portfolio of Pureit? How would you explain the rationale for current offerings of the company? In most of the developing countries, potable drinking water is a scarcity which is also evident from the episodes and high frequency of the water-borne diseases. Boiling water is cumbersome, resource intensive & expensive. Keeping that in mind the scientists developed the Pureit range of water purifiers to meet the need of drinking & cooking water of rural population. Pureit is safe, easy & costs less than a rupee to purify a litre of water, which led to the success of the product. Pureit is the world’s largest selling water purifier, being sold in more than 9 countries. 3. What was so special about the Water Team that enabled the success of the project? There were three main factors for the success of the water team. • Experience of Yuri Jain in the similar domain. • The startup-like organisation structure and cross-functional teams. • Addition of cause as the driving force for product development apart from cash & Career. 4. How would you interpret the consumer behaviour? The consumers at the lower end of the spectrum would still prefer boiled water because of probable lack of awareness and knowledge, this space required more penetration from the company. On the other hand, Pureit Marvella had created an opportunity for profitability but intense competition made it difficult to price it on the premium side as the consumers would opt for a cheaper product. 5. Explain the competitive scenario in the product segment? According to the recent development, there are multiple companies operating in the water purifier segment in India like Eureka Forbes, Kent RO System, Hindustan Unilever Ltd., Live-pure Private Ltd., Ion exchange, Whirlpool India Ltd., Hi-Tech RO Systems, Panasonic India Pvt. Ltd., Tata Chemicals Ltd. and Kaz USA, Inc. After initial problems like low acceptance of the product like Pureit, the sales have been increasing. HUL has taken up 4 major channels to reach people: • DTH Demonstration • Doctor’s Partnership program • Retail Channel • Partnership Channel And the total sales by March 2010 was of 3. 7 Million units. HUL has decided to offer a margin of 8% to retailers and 7% to distributors which is on the lower side as compared to Eureka Forbes’ 14%.
India at 70: The good and bad of India’s growth
It has been more than 70 years since India’s independence in 1947 and the country has come a long way in terms of economic and social indicators. India’s nominal GDP has risen from $30 billion1 in 1950 to $2250 billion in 20162, a 75-fold increase. While at the same time, US GDP grew only about 60-folds from $300 billion in 1950 to $18,500 billion in 20163. This is a significant achievement considering the fact that our rulers bled us dry and left the country. However, growth should not be just measured in terms of GDP. It does not convey how the situation has changed at the grassroots level. Achieving a 74% literacy rate from a mere 12% in 7 decades is no mean feat1. Improvements in policies, laws and administration can be seen from improved rankings in ease of doing business Index. Impressive healthcare reforms have shown results as our life expectancy has doubled over years4. However, at the same time we need to take cognizance of the failures along the way and the challenges for India’s future. India accounts for about 17% of world’s population but accounts for only 3% of world’s GDP2. The large population has always been a big concern for the economy and the heavy subsidies puts a strain on the country’s finances. One of the major concerns for India has always been the small contribution of secondary sector, which is a serious anomaly when compared with other developing countries and now we realise the importance of manufacturing sector on the economy and jobs, hence the onset of ‘make in India’ campaign. India definitely needs to improve on a lot of grounds like gender equality, income disparity, social security but in no ways can these undermine the phenomenal development India has made in the recent years.