Conquering the Chaos: Win in India, Win Everywhere Read Online Free PDF Page A

2011, revenues had grown
     nearly fifteen times, and India was now a powerful growth engine for JCB, its largest
     market worldwide, accounting for about a third of global revenues and perhaps half
     of its profits. Strategically, JCB had built a dominant market share. The name “JCB”
     had become synonymous with the industry and virtually the generic term for any construction
     machine. As the Indian construction equipment market is taking off (it is expected
     to be one of the top five markets in the world by 2015), JCB is extraordinarily well
     positioned to ride the wave, while its competitors, including Caterpillar, Komatsu,
     and Volvo, are scrambling to find a way to participate more effectively. How did JCB
     do it?
Strong and visible leadership commitment to India . Anthony Bamford, Alan Blake (then head of manufacturing and now the global CEO),
     and the leadership team at JCB invested time on the ground to understand the market
     in a nuanced way. They were therefore able to pick up the early signals that drove
     them to preemptively invest in India and create the market for their machines at a
     time when India was number 30 in the global construction equipment rankings. JCB competitors
     underinvested in India. In contrast to JCB, they prioritized India according to the
     current size of the market rather than the potential size, delegated responsibility
     for India to midlevel managers in their Asian regional headquarters, and invested
     in proportion to the size of their existing business rather than the opportunity.
     More important, leaders at JCB were personally engaged in helping build the business
     in India; they were deeply involved in developing the dealer network, in product development,
     in the manufacturing strategy, and in building capability on the ground. Nor did their
     commitment wax and wane with the ups and downs of the Indian economy; in the middle
     of the financial crisis of 2008, when most competitors froze their investments in
     India, not only did JCB carry through with its $100 million manufacturing investment,
     it also put in a massive equipment-financing program to aid customers and dealers.
     When demand recovered, JCB was able to dramatically consolidate its leadership.
Leveraged global know-how to develop offerings customized for the local market and
     spanning price points . Unlike competitors Caterpillar, Volvo, and Komatsu, JCB decided to focus on inexpensive
     and versatile backhoes, rather than more productive excavators, and in 2005 launched
     a new model, the 3DX, which went on to become the best-selling construction machine
     in India. JCB engineers worked hard to adapt the global model for India. While other
     players optimized their machines for maximum speed and productivity, just as they
     did in developed markets, JCB optimized machines for fuel efficiency, understanding
     that this is the biggest driver of operating economics. Over one hundred innovations,
     small and large, went into making a product that was fully adapted to Indian operation
     processes and usage conditions. For instance, it brought down the frictional losses
     in the hydraulic system, modified filtration to handle dusty conditions and the use
     of diesel adulterated with kerosene, used an aluminum rather than copper radiator
     to bring down cost, and a heavier bucket. Discovering that many operators are paid
     by the hour while others are paid by the job, it created two switchable modes of operation,
     economy and power mode, so that operators could choose when to optimize for fuel efficiency
     versus productivity. The 3DX was swiftly followed by an explosion of the product range,
     with a three-ton wheel-loading shovel, a wheel loader, a crane, excavators, and finally
     a five-ton entry-level backhoe loader—the 2DX—meant for lighter applications in rural
     India. With twenty-one different machines, JCB offers the broadest product range of
     any competitor.
Localized manufacturing and a