Class Assignment

22-09-2021

Instructions:
(a) The answers to the questions can either be in soft format (MS
Word/Pdf) or can be handwritten and then
photographed/scanned and uploaded
(b) All answers must be uploaded before the close of timing.
(c) Maximum marks are 10. Straight, Crisp and to the point
answers will be rewarded
(d) Plagiarism in any form will be severely penalised. However
you are free to refer to any online /offline resource for
conceptual understanding

Case Study

Phoenix, based in Kentucky is a North American Company that

provides process technologies and equipment for the metals and
mining industries. For over 30 years, PHOENIX Process Equipment
has been committed to producing the most efficient and reliable
technology for mineral processing, effluent water treatment, and
water purification and water recycling. Phoenix has always placed
process engineering at the absolute core of their business placing
itself as market leader in majority of countries.

Its most important customer Organizations operate in India, Zambia,

Australia, and Chile. Phoenix understands the potential of Indian
market and is actively looking to enhance its presence. It decides to
set-up its subsidiary in India to provide world class service to its
Indian customers through better engagement and provide them on
ground support. Up until 2017, Phoenix had had not seen the Indian
market as strategically important and made limited equipment sales
to the customers including TATA Steel and Jindal Steel and a slew of
other Indian Steel producers and users of process equipment across
various Industry verticals. All Sales to Indian Customers prior to
formation of Indian subsidiary were handled by a variety of local
agents on periodic ad hoc and case to case basis. The customers too
felt unhappy dealing with agents on behalf of parent company but
were still forced to buy from Phoenix as they (Phoenix as supplier)
were market leaders.

Phoenix realized that in order to exploit the full market potential it

needs to have its own presence in India and consequently its Indian
HQ was setup in June 2017. Phoenix setup its footprint in India by
appointing a local Indian as first employee titled as Global Key
Account Manager (GKAM). The objective was to enhance Phoenix’s
involvement in what it realised was an increasingly important
marketplace.

From the start the GKAM noted that, while the reputation and merit
of his parent Company appeared to ‘open doors’, it didn’t create
sales. Thus he actively sought to make contacts within the Indian
customer organization. Before any project business had begun to be
negotiated, he created new personal relationships, and thereby
gained knowledge of decision makers and their behaviours.

A customer (person or entity like TATA Steel or Jindal) who imports

product from cross borders (outside their parent Country) is referred
as Importer of Record (IOR). By definition, an importer of record
(IOR) refers to an importer (an entity or an individual) who is
responsible for ensuring that legal goods are imported following the
laws and regulations of the importing country. IOR is responsible for
importation and clearance of their shipment from customs and must
comply to all regulations and pay applicable customs duty and
taxes.

In 2019, according to GKAM the relationship between Phoenix and the

customer organization has developed through his personal efforts
and these relationships have multiplied to embrace a number of
different hierarchical levels and different business units.

According to the GKAM, the IOR has evolved through personal

meetings and working together, resulting in several successful
projects being implemented. The projects that Phoenix manages are
large (worth at least a million dollar ranging upto 20 million dollars)
and thus successful relationships are important to ensure good
profits.

He states that some cultures appear to demand a more personalised

approach to conducting business than in Western countries. Such
cultures accentuate the role of individual contacts and actions as
opposed to corporate ones.

Phoenix has found that in India things are discussed ‘between

persons, not between companies...even though there are fancy
instruments and advance knowledge...and complicated ‘legal text’.

The GKAM represents an example of how a single individual’s

perceptions and subsequent actions can facilitate the development
of a whole IOR. He explains: ‘If we have a big deal under discussion
and it doesn’t progress, than I can ask for an audience (with the
customer’s CEO).

Also, when the customer believes that ‘a project is not working as it

should and they are unsatisfied, the idea is that I take the message
to our CEO and top presidents of the divisions’.

He concludes that ‘it is important that the customer organization

and our own organization have a person in between who can meet
the top management of each company’. Indeed, when in 2005
negotiations stalled between one of Phoenix’s business units and
one of the key customer’s business units in Zambia, the customer
called out their Indian manager who had previously conducted
project negotiations with the GKAM
Final negotiations were then made between these two individuals,
with the Indian manager ultimately giving free rein to the GKAM to
decide a fair deal. It shows how successful relationship experiences
at the individual and project level can help to develop IORs even
when dealing with different customer and supplier units.

Question/ Excercise

In 2020, during pandemic the business and engagement took a hit as

the movement of GKAM was restricted due to lockdown and mobility.
Also in view of overall economic slowdown during this period and due
to this blip in manufacturing cycle, there was an overall reduction in
enquiries, RFQs (Request for Quotation) and Business. Phoenix was
worried and wanted to take some strategic steps to counter this now
and also build a robust platform for future where such turbulences
can be countered and risk can be mitigated. They decide to build and
migrate to an e-commerce platform to complete their customer’s
journey.

Do a SWOT analysis for Phoenix advocating to build an e-commerce

platform to be presented to their Board for them to take a GO/NO-
GO decision

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