Innovating to Leadership Position

From the case, it is very evident that GACL has numerous strengths. A very efficientmanagement is most obviously the driving factor for the success of GACL. The followingstrength can be identified in the strategy of GACL. y GACL gave very high regard to efficiency. To improve efficiency technological breakthroughs were made during the development. Its continous drive for cost efficiencyand quality are derived from an emphasis on replicating global best practices andcontinous innovation. GACL gave importance to adoption of new technology for controlling and ensuringquality with minimum environmental hazards. The use of Australian surface miners is anexample for this. This ensured that considerable time and cost are saved. Many suchinnovative leaps were taken in technology. y GACL has planned the location of its plants very strategically. It has planned in such away that there is maximum exposure to all parts of India. y GACL strives to reach optimum efficiency in logistics management. The planning of searoute is a perfect example to illustrate this.

This move not only saved time andtransportation cost, but gave access to new and emerging markets. y GACL has maximum efficiency in fuel usage. The system in place for importing coal cutdown the cost of fuel remarkably. y GACL has its own captive power plant and this has made GACL the world leader in lowcost of cement production. y GACL has acquired stakes in DLF, ACC and other small players, which has given itaccess to a good distribution system. Within a short period, GACL has achieved a unique position amongst the cement manufacturers in India.

With plants in Gujarat, HP, andPunjab, and a complete infrastructure of bulk cement sea movement, the company hasaccess to the richest markets in India. y GACL has a very good reputation in the market and has a high brand value. This givesthe access to large funds and the freedom to choose funding options. Mobilisation of  R s1500 crore for expansion earlier, was achieved easily, considerable amount being from debt markets. y GACL has empowered employees, who are committed, motivated and encouraged to thegrowth of the organization.

There is an µI can¶ culture in the organization. Gujarat Ambuja Cement Ltd- Innovating to Leadership position Paven Raj,Roll No-9, PGPCM The following were/ are the opportunities for GACL: y The per capita consumption of cement in India now is only 85Kg compared to the globalaverage of 250Kg. This shows that the cement industry can keep growing at a very highrate. This indirectly means that the current strategy of expansion will still reap benefits infuture. y The cement manufacture industry is a capital intensive one.

This will prevent the other small players from entering the market and capturing a decent market share. The hugecapital involved in the deals between outside companies and the Indian ones are anindication of how capital intensive the industry is. y The situation of restrictions for other companies to access to all geographical areas is a big opportunity to the GACL. Any company, if from now on, wants to expand its reach,will have to face many obstacles such as setting up new plants, identifying proper areaand accessing distribution networks b Corporate level strategy As far as GACL is concerned, the growth strategy is very clear- ? get volumes and achievedominant market shares?. For this, over the last 20 plus years, what GACL has been trying to dois expand its reach to all the boundaries. GACL has been setting up plants which give themstrategic and location advantages over the competitors. They have been acquiring small, mediumand large competitors at very high prices. The company right now has a mission of reaching 20million tones production capacity.

Gujarat Ambuja Cement Ltd- Innovating to Leadership position Paven Raj,Roll No-9, PGPCM III. Conclusions and Recommendations GACL has a very good position in the Indian market. It has an efficient management system,good use of technology, a reputed position in the market, a good brand value, good distributionnetwork. With all of these, of GACL can hold on to this the same way they have done it over theyears, their ultimate dream of market dominance is not far away from them.