the bangalore brand

8/9/2019 The Bangalore Brand

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Assignment

Of

Business Environment

On

The Bangalore Brand

Submitted to :

Submitted by:

Mr. Mandip Saini

Pallavi Modi

Dept of Management

R315A22

LSB

10801939

MBA 1st Sem

Lovely Professional University

2008-10


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On the fast track: With people migrating to Bangalore falling in love with its

culture, food and weather, the profile of the Bangalorean has changeddramatically.

About Bangalore

Beyond the steel and glass high-rises that starkly epitomise Bangalores

unfettered modernist push, beyond the pubs, the IT companies, the

space-starved pathways, there exists a people, alive, breathing life every

day to build a brand called Bangalore. It is that vibrant, demographic mix

that gives this city its image, its magnetic aura to trigger inward

migrations decade after decade and earn Bangalore its A-1 city tag.

This seldom-heralded dynamism of the Bangalorean could well be the

springboard for out city to eventually wear the coveted World City tag.

Long journey

The journey of that change had begun much before, when the British

cantonments triggered the first influx. Then came the 1940s and 1950s

which spurred a rapid growth driven by the steady inflow of Kannadigas

from the rest of Karnataka. The 1960s had the new public sector giants


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unleash the third major Bangalore rush. Then came the job seekers from

Kerala and Tamil Nadu, West Bengal and Gujarat. The arrival of Texas

Instruments in 1985 as the first multinational proved a defining moment

for Brand Bangalore. The stage was firmly set for the citys eventual

emergence as an IT hub, a Silicon Valley, a symbol of Indias softwarepotential. The clichd Pensioners Paradise suddenly turned an

uncomfortable sobriquet to wear. Bangalore yearned for a bigger tag, a

global brand name. The world city tag beckoned big time. The transition

was quick. Foreigners who, well, once looked foreign, were no longer

strangers. They were not missionaries or tourists anymore. The

Americans, the Europeans, the Chinese, the Japanese were the new

business partners. Some were even employees. They had a new home:

Bangalore, no lesser than where they came from. Interacting on equal

footing with the Bangalorean, they collectively redefined the citys image.

For some, it was the culture, for others it was the food and weather. Some

had even fallen in love with someone here. Among the expatriates were alsostudents pursuing professional education or internships from an assortment of

countries such as Iran, Bangladesh, Sri Lanka, Germany and France.

Bangalore Brand

Because of the competitive advantage of Bangalore has helped it earn the

name, the "Silicon Valley of India". Today, Bangalore is one of the

favourite destinations for IT&ITES companies in India and abroad. Theproactive role is played by the state government in developing the city as

an IT destination. However, Bangalore has recently been facing stiff

competition from other cities so far as investment from domestic and

foreign companies is concerned. It seems to be losing its competitive

advantage for doing business to other emerging destinations. So they are

looking into the infrastructural problems Bangalore is facing and the

growth of alternative destinations such as Hyderabad and Chennai.

The factors that contribute to the competitive advantage of a Bangalore

are:

Sustainable competitive advantage and the factors that are important

for this kind of advantage

The role of the government in developing and sustaining the

competitive advantage of a place

The role of infrastructure and civic amenities in making a place an

attractive investment destination


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The impact of political decisions on business and the relationship

between business and politics.

Introduction

Referred to as the 'Silicon Valley of India,' Bangalore, the capital of the

southern state of Karnataka, had a population of 5,686,844 in 2001,

making it India's fifth largest city3 (Refer to Exhibit I). Around 1300

information technology (IT) companies operate in Bangalore and it is

home to around 110,000 technology workers. This is in addition to the

60,000 people working in Business Process Outsourcing (BPO) firms.

In 2003, on an average, two research and development (R&D) centers of

MNCs were opened every week in Bangalore. AMD, AOL, Cisco, Dell,Delphi Automotive Systems, Deutsche Bank, Eastman Kodak, E&Y,

Google, HP, Intel, IBM Corp, Motorola Inc., Oracle, Lucent, Nortel Networks

Ltd, SAP, Tektronix, Texas Instruments, and Yahoo have a presence in the

city and some of the Indian IT majors like Infosys Technologies (Infosys),

MindTree Consulting (MindTree), Wipro Technologies (Wipro) etc., are

headquartered in Bangalore.Fourteen of the top 20 IT exporters in India

(Refer to Exhibit II) have a development center in the city.

The anti-outsourcing debate in the US in the early 2000s could not stop an

outflow of Rs. 19.7 billion as foreign investment to Bangalore in the year2003-04 to set up 110 software and BPO companies. Also during the year,

software exports from Bangalore constituted around 36 per cent of the

total exports from the Software Technology Parks of India (STPI). In the

previous year too, Bangalore had been the leader in software exports .Of

the $4 billion IT export revenues from Karnataka in 2003-04, 95 percent

came from Bangalore. The first four months of fiscal 2004-05 have seen

61 IT companies setting up operations in the Garden City. Bangalore has

been reported as the largest job-creating city in India with more than

65,000 jobs likely to be created in 2004. However, the rapid growth of thecity has resulted in infrastructural bottlenecks like traffic congestion, lack

of hotel accommodation, lack of public service amenities etc., in the

recent past.

The Bangalore brand has also been facing stiff competition from upcoming

cities like Hyderabad and Chennai, for being projected as the IT hub of

India. With the support of the respective state governments, these cities

are being projected as the alternative destination for new IT ventures.

Growth of Bangalore
http://www.icmrindia.org/casestudies/catalogue/Economics/The%20Bangalore%20Brand-Economics.htm#3]http://www.icmrindia.org/casestudies/catalogue/Economics/The%20Bangalore%20Brand-Economics.htm#3]


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Bangalore has a legacy of high quality research institutions starting withthe Indian Institute of Science (IISc) built in 1909. The Government ofIndia's (GoI) decision to locate high-level R&D centers in Bangalore (Referto Exhibit IV) laid the foundation for the technological prominence of thecity. Being the pioneer in India in introducing engineering colleges

through private participation, Karnataka has a large pool of technicallyqualified people. In Bangalore alone, 40,000 graduates trained intechnology pass out from 50 colleges every year.

In 1985, Texas Instruments became the first MNC to open a center in

Bangalore with the establishment of its circuit design and development

center. In 1991, the first Software Technology Park in India came up in

Bangalore. In 1992, Bangalore became the first city in India to set up a

satellite earth station for high-speed communication services to facilitate

software exports. In 1996, the National Association of Software & Service

Companies (NASSCOM) came up with a plan intended to help Karnataka

overtake the State of California in the US (known as the Silicon Valley),

both in terms of number of software companies and revenue by 2020.

Competition

Competition to Bangalore has come from cities like Hyderabad, Chennai,

Pune, NCR, Kolkata , Jaipur, Chandigarh, Pune, and Kochi, among others.

Wipro Ltd., with 11,000 employees in Bangalore, has been looking for

growth beyond Bangalore. "Bangalore is a zero-sum game. In terms ofinfrastructure, there has not been any material improvement in the last

five years. As a result, it is becoming difficult to sustain growth here. As

part of our retention management, we want to move for an incremental

growth outside Bangalore as much as possible," said Vivek Paul, vice-

chairman, Wipro. As per reports, IBM Corp. has been considering Kolkata

as the hub for its software and IT services activities in IndiaSaid Kiran

Karnik, President, Nasscom, "The city (Bangalore) attracts new entrants,

but bigger players are beginning to look elsewhere." Added Subroto

Bagchi, COO, MindTree, "Bangalore has not yet lost its edge, however, ifthe situation deteriorates, it could lose business to smaller towns and

cities, where lower population levels provide more room for growth."

Looking ahead

A CII paper brought out in 2004 recommended to the Karnatakagovernment to put in place a plan for implementation of infrastructureprojects like the IT corridor project and the Bangalore-Mysore Expresswayproject. In order to decongest Bangalore and spread development across

the state, the paper recommended that the government support thedevelopment of satellite townships and other cities in Karnataka.


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According to Nasscom, India is expected to achieve revenues of $62billion by 2008-09 and $148 billion by 2012 in ITES / IT, at a CAGR of 35per cent over 2003 to 2012.

As said by Tom Peters

Fifteen years ago, not one in 1,000 Americans could spot Bangalore on

the map. Today, six out of seven think Bangalore is the only city in India.

They basically believe 1 billion people live in Bangalore."

Bibliography

http://www.hinduonnet.com/2007/10/31/stories/2007103160300300.htm

http://www.asiacase.com/ecatalog/NO_FILTERS/page-EC_INDUS-

647924.html

http://www.icmrindia.org/casestudies/catalogue/Economics/The

%20Bangalore%20Brand-Economics.htm
http://www.hinduonnet.com/2007/10/31/stories/2007103160300300.htmhttp://www.asiacase.com/ecatalog/NO_FILTERS/page-EC_INDUS-647924.htmlhttp://www.asiacase.com/ecatalog/NO_FILTERS/page-EC_INDUS-647924.htmlhttp://www.icmrindia.org/casestudies/catalogue/Economics/The%20Bangalore%20Brand-Economics.htmhttp://www.icmrindia.org/casestudies/catalogue/Economics/The%20Bangalore%20Brand-Economics.htmhttp://www.hinduonnet.com/2007/10/31/stories/2007103160300300.htmhttp://www.asiacase.com/ecatalog/NO_FILTERS/page-EC_INDUS-647924.htmlhttp://www.asiacase.com/ecatalog/NO_FILTERS/page-EC_INDUS-647924.htmlhttp://www.icmrindia.org/casestudies/catalogue/Economics/The%20Bangalore%20Brand-Economics.htmhttp://www.icmrindia.org/casestudies/catalogue/Economics/The%20Bangalore%20Brand-Economics.htm

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