Developing international positioning model for defence goods.

Author:Srinivasan, R.
Position:Report
 
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  1. INTRODUCTION

    Many industries have witnessed accelerated and enhanced globalization in both pace and magnitude in the latter half of 20th century. At the dawn of new millennium, such trends of globalization have forced many organizations to perform the biopsy of their business styles and has stirred up fierce competition even in the industries which are quite away from onslaught of foreign rivalry like defence industry. Therefore, if it is interpreted as defence market is free from challenges, will not be true. Keeping in view such issues and considering the prior research on international business and positioning perspectives, the present article develops a model for international positioning of defence systems. The literature of the subject admits that to come up with the 'right' positioning strategy is not something that 'just happens', especially because of its exclusive nature defence business. It seeks a good deal of marketing research and analysis, in order to understand, first, whether the specialized products have international market potential, second, in which market one should enter and how ( Koch,2001), and third, how to compete in that market in a much effective way with respect to the competitors (Brooksbank, 1994). This article addresses these issues for defence systems by developing a model.

    The article is organized as follows. Section 2 tailors the information for international positioning process (IPP) in terms of information development, information validation and information refinement. The information is validated using statistical package R and refined using Principal Component Analysis and Factor Analysis. Section 3 develops the model for international positioning of defence products. Section 4 concludes the article and discusses limitations and scope for future study

  2. TAILORING THE INFORMATION

    2.1 Information Framework for International Positioning Process

    To address the objective of this paper, a thorough literature review was made to explore the information for international positioning of defence systems. The development of information framework is discussed in detail in the manuscript of Sharma and Srinivasan, 2008. The resulted framework developed for the study includes the broad section of 4 cardinal dimensions, 12 adjuvant dimensions and 35 decision variables that represent the entire set of indicators for worldwide positioning. Cardinal dimensions are main dimensions that determine the value of each step of positioning process. To support this, the concept of adjuvant dimension is developed, which are supportive dimensions to cardinal dimensions. This framework is used to develop the model for international positioning of defence products. Internal scanning is listed as the first cardinal dimension in the framework which is considered as a prerequisite for this exercise. It helps in evaluating the international business capability of the firm and assesses product quality of the selected defence products in comparison with world leaders. The second cardinal dimension of the framework is external scanning where the central focus concern is appropriate market identification. Entry mode decision is the third cardinal dimension that identifies most suitable entry mode to the target nation. Competitive positioning is the fourth cardinal dimension listed in the framework which is executed in terms of marketing mix and oligopoly reactions.

    2.2 Information Validation

    The next important issue is, whether the information mentioned in the framework covers each aspect of international positioning for defence products. For that, information needs to be validated scientifically by the experts in international business of defence goods. A judgmental sample of 109 experts of India and abroad dealing with foreign defence business was selected. A focus group session for this purpose was organized. It was attended by 42 top ranked officials of Indian defence companies and 15 experts of international defence business from most reputed management institutions of India. Rest, experts and senior officials involved in the international business of defence goods, represent Indian and foreign defence companies were contacted personally and through mail. In order to provide exploratory answers to the research issue posed in this study, the learned experts were asked to rate each of the decision variable of information framework (Sharma1 and Srinivasan, 2008) in terms of "degree of importance they...

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