The Company Manufacturing Fluid Handling Products

Published Date: 02 Nov 2017

Kirloskar Brothers Limited strength is where they practising innovations more than innovative. They do understand the market needs and apply their long-practised research methodology into their production process. They believe innovations are more important and they had coupled some research into engineering to design the products. Their weakness is that they are not passionate enough to capitulate their past legacy. They try to focus and identify their customers' pain and modifying it with correct solution.

There is more opportunity for them to grow because they change their focus to maintain the competitive edge. They planned to balance the growth in manner. They also support the environment and society s they want to be respect and valued name, they have to absorb competition and challenges that the market poses on them from time to time in most ethical and integrated business module.

It's it easy for Kirloskar to enter Malaysia because the Malaysia political stand especially the General Election going to be held soon. Morgan Stanley's Research state that Barisan Nasional (BN) victory of two-thirds of the 222 parliamentary seats will surprise investors. As per reported, Morgan Stanley added that the US financial research house also noted the results will have a huge effect on the Umno election in June 2013. But on the other hand, investors would see this as a negative risk if BN loses in winning less than 50 per cent of the seats.

These risks would then affect leadership and government stability. Besides that, by postponing the reform agenda undertaken by the country in the near term until political stability will be restored. The research house also warned that Malaysia is suffering from a "Dutch Disease of sorts" that slows down structural reform, resulting in lacklustre private investment. (Morgan Stanley, 2013)

He also noted that reforms have been implemented since Prime Minister Datuk Seri Najib Razak came into power, but they have failed to address the root of the problem, which is the lack of a suitably qualified labour force. He added in his said, "These reform measures are steps in the right direction, we think, but more needs to be done." Thus the labour law restriction is loosening to attract more local talent to return back to Malaysia for work and permission to the import of overseas labour.

Therefore, Kirloskar will be in dilemma situation to invest to Malaysia. For them, it is positively to establish a company in Malaysia before the election. Once the election result are announced, the ruling BN losses, it will turn negative risk to them. This will lead them to pull back their investment decision toward Malaysia market as the potential one. The investment portfolio will be diverted to other country which will definitely affect our economy.

They believe that the innovation are much important compared to innovative. Furthermore, they must understand the visual aesthetics embodied in the shape of the label or package. Although that the Indian like to use their preferred colour and it could be enough to perceive among the cultures, adaptation to the local Malaysia preferences maybe required. The product labelling is always most perceive to Malaysian as their believe that India’s product is not that good and have no talent to invent a new technology of production.

The diversity of cultures around the world is also reflected in languages. A person can learn a great deal about another culture without leaving home by studying its languages and literature. For Kirloskar to enter the market, languages are the crucial tools to communicating with customers, channel intermediaries and others. The adaptation toward the Malaysia labour rules and regulation, languages and life style are much in need for Kirloskar if they really want to import staff from own country.

Labelling regulation had been adopted by 40 over countries for last ten years but unfortunately the regulations characteristics and their degree of implementation are greatly varied (Phillips & McNeill, 2000; Carter & Gruère, 2003;Haigh, 2004). According to Phillips & McNeill (2000), while a large majority of countries belonging to the Organization for Economic Cooperation and Development (OECD) have implemented some type of labelling policy, only a few developing countries have introduced labelling laws, and even fewer have implemented them.

We need to have at least RM4,400 which equal to 78,000Rs to stay in New Delhi in order to maintain the same standard of life that you can have in Kuala Lumpur with RM8,100. Up to 2013 March, the inflation rate is recorded at 1.60 percent in Malaysia by Department of Statistics Malaysia. In 1974, Malaysian Inflation rate have increased to 23.9 percent at its highest rate from the average of 3.74 percent and it also recorded that inflation rate has going low of -2.40 percent in July 2009.

In year 2013, Malaysia's consumer price index (CPI) is expected to increase by between 2% and 2.5%. This is mainly because of the implementation of minimum wage policy and subsidy rationalisation programme by the government. According to the Hong Leong Research (Jan 2013), "Resilient domestic demand could possibly facilitate partial transfer of higher cost to consumers particularly by industries that are heavily reliant on foreign labour". There are mild inflation trend happens and we are suffer from the slowest pace to reduce inflation rate within this three years since 2012.

Manokaran Mottain (Alliance Bank Malaysia research chief economist) told media that they are while expecting a slower pace of inflation in the first half-year, potential subsidy cuts internally and externally after the post GE 13 could likely pressure a reversal in price pressures in second half of 2013. As the company decision to enter a new market, they would have to think about the salary index and exchange rate. Would the salary enough to sustain the talent and work in Malaysia? They have to take into consideration that how much a person earning in their country can actually equivalent or more than that they will get in new country.

With the increment of daily living standard that going up high, the salary that every staff paid were not able to sustain the living live in Malaysia. The consumers and the expenses getting higher by year and yet the salary remain same. The company always think the salary is the main concern for them whether they need to offer double the price that beyond what Malaysia law set.

Interestingly though, according to Kelly Services managing director Melissa Norman (23 Sep 2012), salaries in Malaysia in the mid-tier management are generally about 10% to 30% lower than that in our Asia-Pacific (Apec) counterparts such as Singapore, Hong Kong and Australia.

"It varies depending on the functions and skills, but for the mid-tier level, the difference is between 10% and 30%. When it comes to the C-suite executives, the difference could be much higher (where salaries overseas could double that in Malaysia)," she says, adding that the exchange rate alone is a pull factor for Malaysians to work overseas.

In order for Kirloskar to enter the new market in Malaysia, they have to take into consideration where the political situation currently takes place. The political issues are the main issues that are directly affect the company decision whether to go into the new market or not. Due to the uncertainty of Malaysia 13th General Election (GE13), new investor doesn’t think it a potential time to enter the market. They are waiting for the result of GE13 to be announced before they make the decision. If Barisan Nasional wins, it’s a great time to enter the new market. On the other hand, they will be drawback if BN loses.

Besides, Kirloskar have to think about their visual aesthetics and languages when they entering the new market. Kirloskar have to localise the perception on the labelling on their product and they need to train their staff of the local language in Malaysia. They have to communicate with the suppliers, customers and other associates.

In time being, the salary offered to the imported staff in the company must be able to sustain their living standard in Malaysia. Due to exchange rate fluctuation, they must be able to cover the staff living expenses at least. They shall also bind to some company law and regulation where a job opportunity must be open to local Malaysian. This is to create more job opportunity in Malaysia and a way to attract talent to flow back into Malaysia.

Being live in a country with high inflation rate, new investor will not take high risk to invest a new company as it going to lead him to high financial spending of establishment. With consideration of Inflation and the exchange rate fluctuation, the salary in market must be revised to match the profession and the import and export of talent from own country or local. According to the news from the well-known company, it’s hard to hold the talent in the company for expansion without the right salary offered.