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By backward integration, that is buying suppliers, barrier to entry can be created by preventing competitors to gain access to these suppliers and thus prevent the entry of new competitors, ex; When Hutchison Whampoa offered a 67% stake in Hutchison Essar. Many strong competitors like Reliance communication with the highest bid approached the company to block foreign companies like Vodafone to enter the Indian market. By forward integration, that is buying your distribution chain and buyers, a direct access can be gained to an established market without having your own customer base or facilities.

Vodafone with its acquisition with the Hutchison Essar group helped to gain the market share while entering the market and now the company has operations in 16 circles covering 86% of India’s mobile customer base with over 34.1 million customers

Indian IT sector to bounce back from the recent disaster

Shanto Ghosh, Principal Economist at audit firm Deloitte mentioned, The only chance for the IT sector to bounce back in the market is that the contract come up for renegotiation in early 2010, as first two quarters of 2008-09, IT sector was resilient and only between the period of October and January contracts come up for renewal and most companies have signed for lower rates, from this prediction the conclusion can be drawn that there is no possibility for the contracts to go UP for renegotiation until next January. Surrendering of existing loans and subsidies won’t be of much help as it won’t lead for increase in consumption , the better option would be investing the money in the infrastructure, which is no doubt the reason for strong position of IT in the market. In fact, there is nothing to be worried about if the corporates have stopped investing just because of the breakdown of the global market, once the industry get back in track, the investment will be no doubt available in the market because considering the low decline in the IT industry when the other sectors like banking and retail were adversely affected, the investors are well aware of the fact that the sector has still got a lot in it and is competent to recover the losses it has made.

Return on investment (ROI) and Cost based analysis (CBA) were the most widely used appraisal techniques for weighing IT investments (Lubbe et al., 1996). Rather than formal techniques such as pay back, (IRR) internal rate of return or net present value (NPV). Common problem with these methods were that they were not able to take account into consideration all the different aspects of probable benefits and even wrong projects were approved as a result. As most of the critical benefits are not tangible(e.g., improved staff morale)

Newton (1995) states that organisation should decide how they will treat the IT benefits and how they want to balance the different perspectives of benefits. Newton (1995)notes that IT cannot be isolated for business processes, and hence policies on IT benefits will impact changes in the roles and responsibilities for business operation.

Ward et al. (1996) believe that it is not possible to anticipate all benefits at the projects approval stage. The implication is that there are more benefits to be gained after implementation, but that current practices mitigate against exploring these potential further benefits. There appears to be a potential paradox between th