Destination India : A minor field study on how Swedish companies can facilitate their establishment in India

University essay from Stockholms universitet/Företagsekonomiska institutionen; Stockholms universitet/Företagsekonomiska institutionen

Author: Pernilla Henkow; Cecilia Otteland; [2006]

Keywords: ;

Abstract:

We are about to, or already have, entered the Asian century meaning that this huge continent is going to play a key role in the world’s economy in the future. New vibrant markets provide all kinds of business opportunities for companies around the world. There is no time being a passive player, standing beside and watch. One of these emerging markets is India with a fast growing economy, huge middle class population a large pool of qualified manpower. Although, the Indian market shows many opportunities and possibilities, one must not forget the challenges that follow. India is the land of contrasts due to differences in culture, language and traditions. This diversity also affects the Indian business environment, which makes it complex and hard to manage. Therefore, listening to and use the experiences other Swedish companies have had when establishing in India may be a crucial factor for success when entering the market. This discussion concludes in the following question; how can Swedish companies simplify and facilitate their establishment in India? The main purpose of our study is to investigate the experiences Swedish companies have had when establishing in the India market. Moreover, the purpose aims at identifying differences in culture, business behaviour and negotiating techniques between Sweden and India. Finally, we will suggest concrete guidelines for Swedish companies, in order to simplify their establishment in India. With a hermeneutic scientific starting point, this study aims at creating comprehension and interpretation of the theory and the empirical material. Since the theories are studied in order to be related and compared to the empirical material, the study has a deductive approach. Moreover, the study has a qualitative method in order to get deeper knowledge and a greater understanding about the subject. The data has been gathered through interviews, analysed and correlated to the theory in order to finally, in the conclusions, give guidelines to Swedish companies that are about to establish at the Indian market. The theoretical framework consists of the three major blocks International Business, Culture and Business Behaviour. The reason for choosing these theory blocks is their relevance for our research question and the purpose of our study. International Business is more an introduction to companies going abroad and to our study, while we have chosen to dedicate an own block to both culture and business behaviour due to their impact on doing business in a foreign environment. Furthermore, a separate chapter about India as a country, market and business environment is presented. The empirical material has been gathered through nine interviews conducted at Swedish companies established in India, and five e-interviews with Swedish persons involved in the establishment process. The companies participating in our study are located in four different Indian cities; New Delhi, Mumbai, Pune and Bangalore. The respondents are either CEO or Managing Director. Due to the different locations, years of operating, business areas and the establishment form, the companies have had different experiences when establishing in India. Some of the conclusions are that a Swedish business model in an organisation with only Indian employees is a successful solution to facilitate the co operation between the parent company and the Indian office but also to get the local knowledge needed. Moreover, patience, openness and transparency are key success factors in Indo-Swede collaborations.

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