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Over time, the strategic forays into new businesses are expected to
garner a significant share of these emerging high-growth markets in
India.
HISTORY
ITC was incorporated on August 24, 1910 under the name Imperial
Tobacco Company of India Limited. As the Company's ownership
progressively Indianised, the name of the Company was
changed from Imperial Tobacco Company of India Limited to India
Tobacco Company Limited in 1970 and then to I.T.C. Limited in 1974.
BACKGROUND-
This decision of the Company was historic in more ways than one. It
was to mark the beginning of a long and eventful journey into India's
future. The Company's headquarter building, 'Virginia House', which
came up on that plot of land two years later, would go on to become
one of Kolkata's most venerated landmarks.
Though the first six decades of the Company's existence were
primarily devoted to the growth and consolidation of the Cigarettes
and Leaf Tobacco businesses, the Seventies witnessed the
beginnings of a corporate transformation that would usher in
momentous changes in the life of the Company.
ITC chose the hotels business for its potential to earn high levels of
foreign exchange, create tourism infrastructure and generate large
scale direct and indirect employment. Since then ITC's Hotels
business has grown to occupy a position of leadership, with over
100 owned and managed properties spread across India.
In 2000, ITC forayed into the Greeting, Gifting and Stationery products
business with the launch of Expressions range of greeting cards. A
line of premium range of notebooks under brand ³Paperkraft´ was
launched in 2002.
ITC also entered the Lifestyle Retailing business with the Wills
Sport range of international quality relaxed wear for men and women
in 2000. The Wills Lifestyle chain of exclusive stores later expanded
its range to include Wills Classic formal wear (2002) andWills Clublife
evening wear (2003).
ITC also initiated a foray into the popular segment with its men's wear
brand, John Players, in 2002. In 2006, Wills Lifestyle became title
partner of the country's most premier fashion event - Wills Lifestyle
India Fashion Week - that has gained recognition from buyers and
retailers as the single largest B-2-B platform for the Fashion Design
industry.
Today ITC Infotech is one of India¶s fastest growing global IT and IT-
enabled services companies and has established itself as a key player
in offshore outsourcing, providing outsourced IT solutions and
services to leading global customers across key focus verticals -
Manufacturing, BFSI (Banking, Financial Services & Insurance),
CPG&R (Consumer Packaged Goods & Retail), THT (Travel,
Hospitality and Transportation) and Media & Entertainment.
In 2002, ITC entered the confectionery and staples segments with the
launch of the brands mint-oand Candyman confectionery
and Aashirvaad atta (wheat flour). 2003 witnessed the introduction
of Sunfeast as the Company entered the biscuits segment.
Cigarettes:cc
ITC is the market leader in cigarettes in India and has a wide range of
popular brands such as Insignia, India Kings, Classic, Gold Flake, Silk
Cut, Navy Cut, Scissors, Capstan, Berkeley, Bristol and Flake in its
portfolio.
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Packaging:cc
ITC's Packaging & Printing Business is the country's largest
convertor of paperboard into packaging. It was set up in 1925 as a
strategic backward integration for ITC's Cigarettes business. It offers
a variety of value-added packaging solutions for the food & beverage,
personal products, cigarette, liquor, cellular phone and IT packaging
industries.
Hotels:
ITC entered the hotels business in 1975 with the acquisition of a hotel
in Chennai which was rechristened Hotel Chola. Today ITC-
Welcomgroup with over 70 hotels is one of the foremost hotel chains
in India.
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Paperboards:cc
In 1979, ITC entered the Paperboards business by promoting ITC
Bhadrachalam Paperboards. ITC's Paperboards business has a
manufacturing capacity of over 360,000 tonnes per year and is a
market leader in India across all carton-consuming segments.
Aggarbattis:cc
ITC has launched Mangaldeep brand of Aggarbattis with a wide range
of fragrances like Rose, Jasmine, Bouquet, Sandalwood, Madhur,
Durbar, Tarangini, Anushri, Ananth and Mogra. Mangaldeep is also
being exported to USA, UAE, Bahrain, Nepal, Singapore, Malaysia,
Oman and South Africa.
Lifestyle Retailing:
ITC entered the Lifestyle Retailing business with the Wills Sport range
of international quality relaxed wear for men and women in 2000. The
Wills Lifestyle chain of exclusive stores later expanded its range to
include Wills Classic formal wear (2002) and Wills Clublife evening
wear (2003). In 2002, ITC entered into the popular segment with its
men's wear brand, John Players. In 2005, ITC introduced Essenza Di
Wills, an exclusive line of prestige fragrance products.
Food:cc
ITC made its entry into the branded & packaged Foods business in
August 2001 with the launch of the "Kitchens of India" brand. In 2002
it expanded into Confectionery, Staples and Snack Foods segments.
ITC's brand in Food category include: Kitchens of India, Aashirvaad,
Sunfeast, Mint-O, Candyman, and Bingo!.
Agri Exports:cc
ITC's International Business Division (IBD) is the country's second
largest exporter of agri-products. ITC exports Feed Ingredients
(Soyameal), Foodgrains (Rice, Wheat, Pulses), Coffee & Spices,
Edible Nuts, Marine Products, and Processed Fruits.
e-choupal:cc
The e-Choupal model of ITC has been very effective in tackling the
challenges posed by the unique features of Indian agriculture,
characterised by fragmented farms, weak infrastructure and the
involvement of numerous intermediaries, among others. ITC's e-
Choupal won the Stockholm Challenge 2006 award is for using
information technology for the economic development of rural
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SWOT Analysisc
SWOTc analysisc is a tool for auditing an organization and its
environment. It is the first stage of planning and helps marketers to
focus on key issuesc
Strengthsc
Weaknesses
The company's original business was traded in tobacco. ITC stands
for Imperial Tobacco Company of India Limited.
Opportunities
Core brands such as Aashirvaad, Mint-o, Bingo! And Sun Feast (and
others) can be developed using strategies of market development,
product development and marketing penetration.
Threats
ITC was incorporated on August 24, 1910 under the name of 'Imperial
Tobacco Company of India Limited'. Its beginnings were humble.
A leased office on Radha Bazar Lane, Kolkata, was the centre of the
Company's existence. The Company celebrated its 16th birthday on
August 24, 1926, by purchasing the plot of land situated at 37,
Chowringhee, (now renamed J.L. Nehru Road) Kolkata, for the sum of
Rs 310,000.
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CIGARRATES:
ITC is the market leader in cigarettes in India. With its wide range of
invaluable brands, it has a leadership position in every segment of
the market. It's highly popular portfolio of brands includes Insignia,
India Kings, Classic, Gold Flake, Silk Cut, Navy Cut, Scissors,
Capstan, Berkeley, Bristol and Flake.
STATIONERY PRODUCTS:
The Aim brand is the largest selling brand of Safety Matches in India.
ITC FOODS-
ITC made its entry into the branded & packaged Foods business in
August 2001 with the launch of theKitchens of India brand. A more
broad-based entry has been made since June 2002 with brand
launches in the Confectionery, Staples and Snack Foods segments.
ITC's world famous restaurants like the Bukhara and the Dum Pukht,
nurtured by the Company's Hotels business, demonstrate that ITC
has a deep understanding of the Indian palate and the expertise
required to translate this knowledge into delightful dining
experiences for the consumer.
ITC has stood for quality products for over 100 years to the Indian
consumer and several of its brands are today internationally
benchmarked for quality.
þc Confectionery
þc Snack Foods
Let your kids dig into ITC's tasty Sunfeast biscuits. And watch the
smile spread as they demolish wholesome delights like Butterscotch
Cream, Orange Marie, Bourbon and Orange Cream.
Milky Magic, made with cow's milk, gives them high energy, stamina
and health; while the Jagmag 'flavour bursts' of the Strawberry and
Pineapple Cream biscuits melt in their mouths.
ITC's Sunfeast is a brand driven by innovative product development
at ITC's state-of-the-art food technology centre in Bengaluru. Every
Sunfeast product is made with utmost care, ensuring world class
standards of hygiene.
Sunfeast symbolises ITC's commitment to create brands that enrich
the quality of life for every Indian. Because our people and our
country deserve the best.
LIFESTYLE RETAILING:
ITC's Lifestyle Retailing Business Division has established a
nationwide retailing presence through itsWills Lifestyle chain of
exclusive specialty stores. Wills Lifestyle, the fashion destination,
offers a tempting choice of Wills Classic work wear, Wills
Sport relaxed wear, Wills Clublife evening wear, fashion accessories
and Essenza Di Wills - an exclusive range of fine fragrances and
bath & body care products and Fiama Di Wills - a range of premium
shampoos and shower gels. Wills Lifestyle has also introduced Wills
Signature designer wear, designed by the leading designers of the
country.
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Keys towards business strategies:
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Vision:
Sustain ITC's position as one of India's most valuable corporations
through world class performance, creating growing value for the
Indian economy and the Company¶s stakeholders
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Mission:
To enhance the wealth generating capability of the enterprise in a
globalising environment, delivering superior and sustainable
stakeholder value
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Objective:cc
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The primary focus of ITC's Social Development Initiatives is to
create sustainable sources of farm and off-farm livelihoods and to
improve the social infrastructure especially in areas where it
impacts women and children. In pursuit of these objectives, the
following goals have been set for the next five years:
Goals:
þc Poverty:
To halve by 2015 the proportion of the world¶s people whose
income is less than $1/day.
þc Hunger:
To halve by 2015 the proportion of the world¶s people who
suffer from hunger.
þc Gender Equality :
Progress towards gender equality and the empowerment of
women should be demonstrated by ensuring that girls and
boys have equal access to primary and secondary education.
þc Environmental Sustainability:
To stop the unsustainable exploitation of natural resources
and to halve, by 2015 the proportion of people who are unable
to reach or to afford safe drinking water.
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ITC's Core Values
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ITC's Core Values are aimed at developing a customer-focused, high-
performance organisation which creates value for all its stakeholders:
þc Trusteeship
þc Customer Focus
We are always customer focused and will deliver what the customer
needs in terms of value, quality and satisfaction.
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þc Respect For People
þc Excellence
þc Innovation
þc Nation Orientation
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7¶S MCKINSEY MODEL-
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Most of us grew up learning about à
Và of the marketing mix:
product, price, place, promotion. And this model still works when the
focus is on product marketing. However most developed economies
have moved on, with an ever-increasing focus on service businesses,
and therefore service marketing.
cSystems:cc
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c Shared values:c
The values and beliefs of the company. Ultimately they guide
employees towards 'valued' behavior.
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Eg- shared values at ITC ltd for the employees and staff are-
³We do what is right, do it well and win. We will strive for
excellence in whatever we do.´
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c Staff:c The company's people resources and how they are
developed, trained, and motivated.
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Management:cc
The Company leadership 'walking the talk' and a relentless
focus on implementing the policy underlines the Company's
approach to employment practices and creating a decent work
environment.
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c Style:cc
The leadership approach of top management and the
company's overall operating approach.
INTRODUCTION-BCG MATRIX
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BOSTON CONSULTING GROUP (BCG) MATRIX is developed by
BRUCE HENDERSON of the BOSTON CONSULTING GROUP IN
THE EARLY 1970¶s.
a) Stars
b) Question marks
c) Cash cows
d) Dogs
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Limitations
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Ac Strategic management and organization structure/structure
follows strategy:
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c Once the mission,vision,goals,objectives,strategies,values
and programmes are defined for an organization.the
manager has to implement and execute the chosen
strategy by developing the organizational capabilities to
reach the target objectives on schedule
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cThe functional strategy:
This is the simplest and least expensive structure.in this the
activities are grouped by the business functions such as
marketing,finance,hr,operations,etc.it promotes specialization
and encourages perfection at a given task.quick decisions
making is possible.however the big disadvantage is that it
allows for top down approach and puts lot of pressure on the
top management to perform.the functional structure can be
diagrammatically represented as follows:-
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cThe divisional structure-
As the small business grows it has more difficulty in managing
different functions in different geographical markets.this
requires a structure that controls operations,competes
successfully in various locations this kind of structure is called
as divisional structure.a banks divisional structure can be
shown on the foll basis:
c Geographic area
North zone,east zone,west zone and south zone
c Customer
Retail segment,HNI,NRI segment etc..HNI(high networth
individuals)
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cMatrix structure:
This is the most complex of all design as it depends on both
ways ie authority and communication
Traditionally on functional and divisional organizational
structure depends on suthority,responsibility, and
communication with a top down approach
1. Corporate strategy
2. Business strategy
3. Functional strategy
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The above levels of management is explain as follows«..
Ac CORPORATE STRATEGY:[CEO,MD]
1. It describe the companies over all direction in terms of its
general attitude towards growth and the management of
its various businesses and the product line.
2. Corporate strategy refers to the principle strategy of the
diversified firm.
3. It is also concerned with selection of businesses.
4. It is also called as highest level of strategy
Ac Business strategy:[HOD]
1. It is usually occurs at the strategic business unit level or
product levels.
2. It emphasis improvement of the competitive position of a
firms product or services in a specified industry
3. Business strategy includes mktg strategy`s, H.R
strategy`s, financial strategy`s, legal strategy`s and
information technology development strategies.
4. This level is based on short and medium term plan and
each department functional responsibilities.
FUTURE BUSINESS STRATEGY OF ITC ARE-
þc Increased exports
Hr strategies-
þc Employee training
þc Self-managing teams
þc Pay for performance
Ac FUNCTIONAL STRATEGY:[SUPERVISORS,WORKERS,STAFFS]
1. It relates to the functional areas such as production,
mktg, financing, personal, etc.
2. The functional strategy aims at achieving functional
objectives.
3. This level is also called as operation strategy level or
departmental strategy level.
4. It is lowest level of strategy management. It is deal with
day to day operation level of the business.
þc Promotion
þc Advertising
þc Pricing
þc Distribution
þc Product design
þc Economies of scale
þc Flexible manufacturing
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Strategic management process
All factors that are internal to the organization are known as the
'internal environment'. They are generally audited by applying the
'Five Ms' which are Men, Money, Machinery, Materials and Markets.
The internal environment is as important for managing change as the
external. As marketers we call the process of managing internal
change à '
Men:
ITC employs over 25,000 people at more than 60 locations across
India. The Company continuously endeavors to enhance its wealth
generating capabilities in a globalizing environment to consistently
reward more than 3, 53,000 shareholders, fulfill the aspirations of its
stakeholders and meet societal expectations.
Money:
ITC is one of India's foremost private sector companies with a market
capitalization of nearly US $ 14 billion and a turnover of over US $ 5
billion. ITC is one of the country's biggest foreign exchange earners
(US $ 3.2 billion in the last decade).
Machinery:
ITC is using world class machinery so that they can match with
demand of the market. Their most of the facilities are fully automated.
Materials:
ITC is using quality raw material so that they can give world class
quality product to their customers. They are very selective while
selecting supplier for them.
Markets:
Its businesses and brands are focused almost entirely on the Indian
markets, and despite being most well-known for its tobacco brands
such as Gold Flake, the business is now diversifying into new FMCG
(Fast Moving Consumer Goods) brands in a number of market sectors
- including cigarettes, hotels, paper, agriculture, packaged foods and
confectionary, branded apparel, personal care, greetings cards,
Information Technology, safety matches, incense sticks and
stationery.
Example-
The macro-environment
This includes all factors that can influence and organization, but that
are out of their direct control. A company does not generally influence
any laws (although it is accepted that they could lobby or be part of a
trade organization). It is continuously changing, and the company
needs to be flexible to adapt. There may be aggressive competition
and rivalry in a market. Globalization means that there is always the
threat of substitute products and new entrants. The wider
environment is also ever changing, and the marketer needs to
compensate for changes in culture, politics, economics and
technology.
India has been one of the best performers in the world economy in
recent years, but rapidly rising inflation and the complexities of
running the world¶s biggest democracy are proving challenging.
Political factors: The political arena has a huge influence upon the
regulation of businesses, and the spending power of consumers and
other businesses. The Indian polity is increasingly seen by political
observers as the problem. When populist political appeals stir the
passions of the masses, government institutions appear less capable
than ever before of accommodating conflicts in a society mobilized
along competing ethnic and religious lines
the management also conduct for this purpose the management must
compare and analyze its present performance level and the desired
future performances level
ITC made a plan and was the only enterprise in the world of its size to
have achieved and sustained three global environmental distinctions
Step2 project implementation
eg-Promotion, Advertising,Pricing
ITC e-Choupal won the Award for the importance of its u c c
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cu its scale and replicability,
sustainability and transparency.c
The Company continues to sustain its unique position as the only
company in the world to be µcarbon positive¶, µwater positive¶ and
µsolid waste recycling positive¶.
Recommendations:
CONCLUSION:
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c ITC promoting their brands through advertisement campaign as
well as door to door promotion.
c ITC now offering more margins, exiting offers and long credit
period to retailers and wholesalers.
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