Sharma Industries (SI) : Structural Dilemma

Group No - 2
Tanvi Rane
Pratik Rungta
Hatim Cyclewala
Saurabh Azgaonkar
Gaurav Sachdeva

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 CONTEXT

● Sharma Industries(SI) was started in 1970s in Bangalore by Rammonahar Sharma in

line of industrial products such as pipes, glasses, industrial sealants, coatings etc.
● Conglomerate business structure with various subsidiaries which were independent
● In 1990s, SI acquired various subsidiaries overseas and increased product lines
● In 2000, Palkhan Sharma became the new Chairperson and made further changes
● Major geographical areas of business -India, South East Asia, Middle East Asia and
Europe with various subsidiaries
● SI started facing problems between their autonomous subsidiaries and a consultant
firm was approached to give solutions for improving organizational structure

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PROBLEM
● Every Subsidiary acted as Independent business : Lack of standard reporting
systems, focus on maximising its own profits
● Difficult to consolidate financial reports worldwide and to gain efficiencies of
uniform information and reporting systems
● Major decisions taken by subsidiaries were for them individually
● Local projects and profits received more time and resources than the projects that
benefitted SI globally
● No transfer of of technology, new product lines and innovations
● No complete knowledge at SI of all products and locations which would allow SI
to capitalize manufacturing efficiency

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SOLUTION
1) An international department having product director for each product line who will coordinate activities,
technology transfer and innovation across each subsidiary with the help of his teams
2) Reorganizing into a worldwide product structure where all subsidiaries of a product line would report to
a product line manager and he would be responsible for coordination and business strategies
development

We would recommend the first solution for the following reasons-

● An opportunity to obtain raw materials, labor, and other resources at the lowest possible cost from
subsidiaries across different regions
● Better communication among the independent subsidiaries
● The autonomy of subsidiaries will remain intact along with profits contribution to SI
● Easy exchange of information, innovations and technologies amongst all subsidiaries
● Incorporation of standard methods of reporting and documentation to facilitate the product line director
● Product Line Director would be an advisor to introduce new products ideas into different geographical 4
regions to maximize profits locally and for SI globally
ThankYou