TATA CONSULTANCY SERVICES: SELLING CERTAINTY Case Solution
1.1Â Â Â Â Â Â Â Â BARGAINING POWER OF THE SUPPLIERS:
Companies operating in the industry are always dependent upon their suppliers and upon the dealing of the companies. The suppliers for the companies in the industry are the IT professionals and their relation with the companies will directly affect the operations of the company. Due to the loss of jobs and less creation of job opportunities has directly affected the supplies of the company and how the company is not able to meet the demands with respect to its methods.
1.2Â Â Â Â Â Â Â Â THREAT OF SUBSTITUTES:
A large number of industrial developments have been occurring in the sector of information technology. Leading companies around the globe belonging to different geographical locations have been able to develop innovative technologies. Emerging markets in across the globe are direct threat to the company as their activities will influence the operations of the company. Prices that have been quoted by the company are high, whereas the quality which is being offered is the same in comparison with other companies in operating in the industry.
1.3Â Â Â Â Â Â Â Â BARRIERS TO ENTRY:
The barriers for the new entrants in the industry are low. The reduced level of barriers for the new entrants is due to the low amount of capital required by the companies entering the industry. Start-up costs for entering the industry are low which increases the probability of companies entering the industry. The value chain involved in the industry for conducting the business activities of the company is large and it allows a number of small enterprises to initiate their business activities with respect to their business and organizational goals.
1.4Â Â Â Â Â Â Â Â RIVALRY AMONGST THE CUSTOMERS:
A number of companies are operating in the industry, and yes the company enjoys a dominant position in the industry however,it still faces serious threats from the competitors in the industry due to their increase activities directed towards increasing their market share. The costs and the offering of the companies operating in the industry are almost the same and are supported by very less of differentiation in positioning. The industry also has the potential of growing rapidly which influenced the companies to increase their business activities.
2Â Â Â Â Â Â Â Â Â Â PESTEL ANALYSIS:
2.1Â Â Â Â Â Â Â Â POLITICAL:
The business operates in the U.S., Europe and Indian markets currently and the political setup in these regions is very stable and business favorable and there are no potential threats of destabilization in these markets currently for the business. Due to this stability in the governance of these regions, the business has flourished for the past few years and is bound to flourish in the future as well. However, the legislation of the U.S. government to lift the taxation exemptions for the organization that outsource their functions to entities outside the U.S. is a disadvantage for the management of the company and destabilized neighboring region of the home country is also a cause of concern.
2.2Â Â Â Â Â Â Â Â ECONOMIC:
The most critical economic plus point for the management of the company is the positive growth of the IT industry in the home country of the company, which is expected to even increase further in the coming years however; the global IT industry has been on a decline due to recession and downfall of the U.S. economy and this is a cause of concern for the management of the company………………….
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