Submitted By: Submitted to:

Alka Sinha Prof. Shubharata Basu

2013PGPM004 Course: Growth Strategies for Developed and Emerging Economies

Assignment: NICT at a Crossroads

1) Do you think NICT should take up PBI Offer?

Advantages and disadvantages of PBI Offer:










































Nice fit in current NICT Business
Model
Sustainable social intervention,
regular employment and
security for CSC VLE
Fixed source of income.
Assured Future Cash Flows.
Excellent Relationship formation
with one of the largest banks in
India
Will achieve economies of scale
Will emerge pan India. National
Brand
Monopoly over technology in
rural areas.

Status quo situation with
stabilized system
Strengthen relationship &
ties with existing
collaborators
May aid in bringing new
collaborators
May have a chance with PBI in
the future

May breed complacency and
corruption among the ranks
PBI has more bargaining power
hence may misuse it
PBI workload may constrain
NICTs capability to offer
diverse service portfolio
PBI may enforce its own
processes and software on NICT
No guarantee of success of PBI

PBI might create substitute
mechanisms to enter the
market
Or, bypass NICT and directly
engage VLEs to setup
standardized compatible
networks encouraging them
to sever ties with NICT
SBI, BoI might consider
opportunistic collaborations
with other vendors setup by
PBI

ACCEPTING THE PROPOSAL REJECTING THE PROPOSAL
ADVANTAGES
DISADVANTAGES





































Based on these factors, NICT should accept the PBI offer.


2) What are ramifications with respect to SBI & BOI if it takes up PBI Offer?
Ramifications that SBI and BOI may face if NICT accepts the PBI offer:
With PBI already vast network in rural coupled with NICT technology will help PBI to
reach rural crowd quicker and faster. This can affect SBI rural customer segment.
PBI is launched under NREGA scheme. This will ensure wider customers base and
more customer loyalty. It may happen that NICT may have to increase its CSC VLE to
ensure proper resource allocation to SBI or BOI.
SBI or BOI may look for other channels apart from NICT to reach to target customers.


Competencies and
Capabilities based Scale
Economy
Business facilitators for
Banks, insurance
companies
Current association with
BOI, SBI, LIC, TATA AIG
Content and Process of Building
Core Competencies
Common Service Centres
(CSCs)
VLE- Village Level
Entrepreneurs
Scope Economy based
Diversification Strategies
The scope economy for
NICT if they accept PBI
proposal would be it will
get chance to serve
schemes like NREGA and
reach 22 million
population.
Serendipity Vs Planning Based
Success
Careful planned execution will
help VLEs and NICT to
increase their profit share.
NICT will have monopoly.
PBI will be able to reach
maximum consumer through
NICT vast existing network.
This in turn will benefit the
rural population.
Core Analytical Framework
Accepting the offer
means scale economy
More reach to the rural
population which echoes
with their core value of
Techno-Socio-Economic
organisation