Business Communication

CASE STUDY 10
ARRIVING TO LAND ANYWHERE
As the taxi screeched to a halt, Mr. D’Souza for the umpteenth time cursed the Monday morning traffic
and his inability to do anything about it. Mr. D’Souza was the Marketing Director of Indian Aviation
Company and was on his way to attend one of his several prelunch strategic meetings. This meeting
had a special importance as it was to open the marketing plans of his company for a new helicopter the
first from a private sector company in India in this category of products. On consulting his watch’ he
reclined that he would be delayed by at least 25 minutes. Hence, he decided to use the time by
reviewing the salient points of his presentation.

---

■ ■ ■
■ ■ ■
■ ■ ■
■ ■ ■
■ ■ ■
Appendix I / 141
The Company
The Indian Aviation Company (IAC) was set up in the Export Processing Zone of one of the four
metropolitan cities of India. The formation of the Company was noteworthy for the fact that it was the
first in the private sector to have been given the licence to manufacture helicopters so far only
Hindustan Aeronautics Ltd (HAL), a public sector company, had the licence to manufacture the
helicopters.
IAC was an Indo-US Joint venture with Brantly Helicopters, USA. The joint venture was initiated
by Mr. Rangnani—a former technician in the Indian Air Force who had settled in the US. The project
was in response to the Indian Government’s initiative and liberalization in inviting non-resident
Indians (NRIs) to bring home their expertise, and promote a new industrial culture in India. The
company was set up with Rs. 1 crore as the project capital in 1986. As per the terms of joint venture,
the helicopter was to be designed originally by the US partner and assembled in India under the
supervision of the US experts. As per the export regulations of the Government of India, 75% of the
output was to be exported out of the country while the remaining could be sold in India.
The Products
The Company decided to manufacture in the beginning two models—one with a carrying capacity of
two passengers, while the other with five, including the pilot in both the cases. The machine for both
models was a four-stroke piston, as against turbo propelled “Chetak” of HAL, the only competitive
offering in the market.
Among other vital uses and service benefits, these helicopters could land anywhere without
requiring helipad. Further, the fuel efficiency and maintenance was amazingly low, working out at
Rs. 1,000/- per hour of flying as against Rs. 8,000/- for the Chetak. Mr. D’Souza had thought of using
these two benefits for creating distinctive competence in the market. The quality standards of the
manufacturer were very high as was expected from the industry where “technical excellence was the
name of the game”. Besides operational quality checks, the US experts would supervise the assembly in
Indian plant and the US Federal Aviation officials would visit to certify, the quality performance.
In addition to the above, the prices of the two models were considerably lower as compared to the
competing offerings. While the two-seater model was priced at Rs. 10 lakhs, the five-seated model was
priced at Rs. 25 lakhs a piece. The helicopter was due to come in the market in June 1988.