Why are Multinational Companies in India?

There are a number of reasons why the multinational companies are coming down to India. India has got a huge market. It has also got one of the fastest growing economies in the world. Besides, the policy of the government towards FDI has also played a major role in attracting the multinational companies in India. For quite a long time, India had a restrictive policy in terms of foreign direct investment. As a result, there was lesser number of companies that showed interest in investing in Indian market. However, the scenario changed during the financial liberalization of the country, especially after 1991. Government, nowadays, makes continuous efforts to attract foreign investments by relaxing many of its policies. As a result, a number of multinational companies have shown interest in Indian market.

Profit of MNCs in India

It is too specify that the companies come and settle in India to earn profit. A company enlarges its jurisdiction of work beyond its native place when they get a wide scope to earn a profit and such is the case of the MNCs that have flourished here. More over India has wide market for different and new goods and services due to the ever increasing population and the varying consumer taste. The government FDI policies have some how benefited them and drawn their attention too. The restrictive policies that stopped the company's inflow are however withdrawn and the country has shown much interest to bring in foreign investment here. Besides the foreign directive policies the labour competitive market, market competition and the macro-economic stability are some of the key factors that magnetize the foreign MNCs here. Following are the reasons why multinational companies consider India as a preferred destination for business: Huge market potential of the country

FDI attractiveness Labor competitiveness Macro-economic stability

Advantages of the growing MNCs to India

There are certain advantages that the underdeveloped countries like and the developing countries like India derive from the foreign MNCs that establishes. They are as under:

Initiating a higher level of investment.

Reducing the technological gap The natural resources are utilized in true sense. The foreign exchange gap is reduced Boosts up the basic economic structure.

some of disadvantages are 1 supplant domestic savings by destroying competition,remove local entrepreneur,unstable industrial growth 2 cause strain to BOP ie balance of payment by repetration of profits,interests,loyalities,management fees. 3 local professional cannot access to working strategies og MNCs 4 mncs by introducing new technology cause technological unemployment. mncs adopt capital intensive technique. so machine takes place of workers. IBM:
International Business Machines Corporation, is a multinational computer technology and IT consulting corporation headquartered in Armonk, New York, United States. IBM manufactures and sells computer hardware and software (with a focus on the latter), and offers infrastructure services, hosting services, and consulting services in areas ranging from mainframe computers to nanotechnology. It has been nicknamed "Big Blue" for its official corporate color. IBM has been well known through most of its recent history as the world's largest computer company and systems integrator. IBM is the largest and most profitable information technology employer in the world. Has eight research laboratories worldwide. IBM employees have earned five Nobel Prizes, four Turing Awards, nine National Medals of Technology, and five National Medals of Science. IBM HISTORY: The company which became IBM was founded in 1896 as the Tabulating Machine Company by Herman Hollerith, in Broome County, New York , where it still maintains very limited operations. It was incorporated as Computing Tabulating Recording Corporation on June 16, 1911, and was listed on the New York Stock Exchange in 1916 by George Winthrop Fairchild. CTR's Canadian and later South American subsidiary was named International Business Machines in 1917, and the entire company took this name in 1924 when Thomas J. Watson took control of it. The beginning of IBMs involvement in IT services can be traced back at least to 1989 when Eastman Kodak Company and IBM completed an agreement by which IBM designed, built and managed a new state-ofthe-art data center for Kodak in Rochester, New York.

Also in 1986, IBM introduced Business Recovery Services, an offering that enables a business to continue operations in the event of an unplanned outage or disaster. In 2002, IBM Global Services acquired the management consulting and technology services arm of PricewaterhouseCoopers

Acquisitions by IBM Since 1999, IBM has made 83 acquisitions. On July 2, 2001 Informix Corporation Database Software, $100 million. October 2, 2002, PWC Consulting from PricewaterhouseCoopers, Business Consulting and Technology Services, $350 million February 21, 2003 Rational Software Corporation, Software Development, $210 million April 7, 2004 Daksh e-Services India BPO Services, $17 million October 20, 2006 Internet Security Systems (ISS) Information security, $130 million October 20, 2006 Palisades Technology Partners, Management consulting January 31, 2008 Cognos, Business Intelligence, $500 million July 28, 2009 SPSS Inc. Statistical analysis software, $120 IBM INDIA : Founded - 1992 (re-entry, after an exit in the 1970s) India Footprints - Bangalore, Delhi, Kolkata, Mumbai, Chennai, Pune, Gurgaon, Noida and Hyderabad Employees 1,12,000 (2009) Estimated revenue - $1 Billion IBM plans to invest $ 6 Billion in next 3 years in INDIA IBM India's domestic revenues grew at 60% in 2005-06 making it one of the highest growth areas in the entire IBM portfolio of geographies & businesses. IBM India is also the biggest domestic IT player in the country, replacing HCL Technologies. Major India deals: Bharti Airtel - $2 billion. Datacom Solutions (part of Videocon Industries) - $200 million IDEA Cellular 7 Year deal for (50 million clients) Conclusion Global Delivery Approach Multi dimensional multiple centres Multiple businesses / Applications Multiple project / Program managers Integrated delivery World Sourcing Social Responsibility

Monitoring and measuring effective implementation of the EMS

IBM employs a variety of mechanisms to monitor and measure the effective implementation of its EMS requirements. These include:

Professional Self-Assessment Program o The professional self-assessment program consists of a series of IBM specific environmental checklists which are used to provide IBM the ability to assess its overall environmental performance globally on a consistent basis. The checklists cover both manufacturing and hardware development locations and non manufacturing locations at a geographic level, product groups and service activities. Environmental Performance Database (EPD) o The EPD functions as one of IBM's internal measurement and tracking systems. The database measures environmental performance in such areas as water effluents, chemical use and emissions, hazardous and nonhazardous waste management, recycling, energy conservation, environmental expenditures and progress toward meeting product stewardship objectives. o The EPD provides the data used in IBM's annual environmental and corporate responsibility reporting as well as in periodic updates on performance and programs that go to senior management. Business units also make use of the database in analyzing their environmental performance and identifying areas for improvement. Corporate internal audits o IBM has established an environmental audit program which is implemented by the corporate internal audit organization. This is a comprehensive audit program which is independent of the Corporate Environmental Affairs staff. Each year, certain sites are audited for environmental, health and safety compliance by IBM's Corporate Internal Audit staff. ISO 14001 surveillance audits o As part of IBM's global registration to ISO 14001, approximately 20 sites or registered entities are audited annually by an independent ISO 14001 registrar. The ISO 14001 surveillance audits are used to verify implementation of IBM's environmental management system.

Controversy:

Recent allegations that IBM Corp. abused its dominant position in the market for mainframe computers are now being investigated by the Justice Department, The Associated Press reported.

IBM rivals claim theyve been illegally frozen out of the mainframe market because of IBMs refusal to allow its mainframe operating software to run on non-IBM computers. They argue that IBM used to license its mainframe software to competitors and operated under an antitrust agreement with the government, but recently stopped doing so in order to neutralize other competition. Mainframes are well known for their reliability and can cost $1 million or more each. They are behind many everyday transactions such as withdrawing cash from an ATM, which often involves the ATM pinging a mainframe at the bank where the customers data is stored. The government has started examining these allegations by sending out formal requests for information about the mainframe market to IBM rivals, according to the Computer and Communications Industry Association, an industry organization that complained to the Justice Department last month about IBMs behavior. Ed Black, CEO of the trade group, said IBM tells big customers that if you buy that other stuff, theyre not going to let that stuff talk to our stuff.
"We

think of the Internet as open and innovative, but thats a lock em up and keep em locked up strategy. Thats very unsatisfactory for the customer base," he added. T3 Technologies Inc., based in Tampa, Fla., lodged a formal complaint against IBM with European antitrust regulators in January and is suing IBM in the U.S. alleging antitrust abuses. It claims IBM has tried to thwart its expansion into making mainframes by denying it licenses for IBMs mainframe software, something done "for no reason other than to remove all competition from the mainframe market." IBM released a statement pointing to a decision last week by a judge in the U.S. District Court for the Southern District of New York dismissing T3s complaint against IBM. IBM said it understood the Department of Justice asked T3 for documents from the litigation, but added it continued to believe there is no merit to T3s claims. The company said it is fully entitled to enforce its intellectual property rights and protect the investments it has made in its technologies. However, IBM said it would cooperate with any inquiries from the Justice Department.

A conflict between IBM and Platform Solutions Inc., whose technology was used to run IBMs mainframe operating software on non-IBM computers, was the catalyst for the complaint. Platform also filed complaints to European regulators about IBMs conduct, until IBM bought Platform last year and the companies dropped their lawsuits against each other. T3 threw its support behind Platforms argument.

Claim: HP also claimed in the announcement that clients are achieving data center cost savings of up to 70 percent through these migrations. Claim: HP says...there is a mainframe skills shortage Claim: HP says its Integrity NonStop servers have better availability than IBMs mainframe. Claim: HP says its Integrity servers offer better total cost of ownership than mainframe