Case Analysis: Silvio Napoli At Schindler India

Zac Andrus
MGB 516
Feb. 27, 2018
Case Analysis
Silvio Napoli at Schindler India

Key Issues
Below are a few of the main key issues that Silvio Napoli faced when starting at Schindler India. These issues are looked at in more depth in the following analysis section, showcasing why they may have surfaced and what they mean for Napoli in his current environment.
1. Market entry to India was based on a standardized elevator that didn’t meet customer needs (no customization options, cost-reduction was the top objective, and rapid urbanization in India was leading to higher quality technology expectations).
2. Cultural differences were not accounted for at a high enough level (working style and speed in India was slower, varying management styles,

Alfred Schindler had been working to transform Schindler into a customer-oriented service company and saw India as a major opportunity as price and service were both major factors in purchasing decisions there along with the fact that there was very fast growth in the urban environments. India had passed a law that forced slightly higher quality elevators to come to market due to safety regulations. There was also a political decision by India that allowed for 100% wholly owned subsidiaries, which made it the perfect time to send Napoli there to start up Schindler India (CAGE Framework). Because Schindler India is a wholly-owned subsidiary, the control over foreign activities as well as the amount of resources committed to the foreign market had to be very high. Unfortunately, the amount of resources committed to India was low, which led to the third key issue in the case in that Shindler India had an inability to quickly adapt to unforeseen geo-political, economic, and intercompany changes. Because of the lack of resources, Napoli was on his own and hired local experts who were still working other jobs when they were hired. This made for a slow transition and also forced Napoli to execute his business plan without having time to commit to continuous forecasting and local environmental learning. For instance, low cost parts prices increased drastically from Shindler

Schindler’s core competencies of building their basic S001 elevators were centralized and other parts for the elevator were outsourced locally in India by Napoli. R&D was also centralized in Europe. Napoli did have a local marketing and sales team in India who were in charge of gaining new contracts and was also starting to form some local partnerships as well. While this international strategy can be successful in certain situations depending on the product offered, cultural differences, and market demand, I think it would be more beneficial for Schindler to adapt and shift towards a transnational strategy. By doing this, it would allow for greater efficiency, learning from the local environment, and flexibility when unforeseen changes occur. It will also make room for more innovation and responsiveness to the Indian environment as I have outlined in my recommendations. (I/R