Armed with the Harvard MBA, Silvio Napoli had formulated a strong strategy as he correctly

identified the right target market and developed a relevant low-cost standardized product for
that market. Ex 5 shows the overall 85% market share of low-rise and manual markets, where
the S001 is well-positioned to enter. As 80% of the profits are in the after-sales section, the
high volume of sales would help Schindler maintain stable future revenues. For executing this
strategy, he hired the right local management. He was young, bold, energetic, a generalist, an
insider and initiative-driven. He acknowledged the competition challenge and so, set
conservative targets for the first year. He was committed to the organizational goals with a
high risk-appetite and took a major life-decision to move his family from Switzerland to
India. On evaluating Silvio’s performance, we believe that while he has mostly delivered well
on strategy formulation, he has been unsuccessful in executing his strategy smoothly due to
his inability to adapt his natural management style and behaviour, which worked well in the
Switzerland HQ, to a distinctly different Indian culture.

Silvio should have prepared himself for the cultural differences before handling the local
management. As per Hofstede’s cultural dimensions theory, India and Switzerland differ on
each of the six dimensions as shown in Annexure 1. Silvio should have learnt the differences
between the cultural intricacies and changed his approach accordingly. Firstly, Indian
employees highly respect their superiors as there is a high power distance and so, the
employees rarely disagree or debate. Silvio should have built informal personal relationships
with his management team while working with them during late nights in the initial phase.
This could have reduced the power distance and the team could have been more comfortable
sharing their opinions and concerns more freely. The management could have revealed
certain unknown important insights that could have helped Silvio reassess his strategy or
address their concerns regarding his original strategy. Silvio should have become more social
and outgoing in his office building by interacting more with his colleagues as well as outside,
with the regulators, government and local businessmen. Secondly, Indians are not
comparatively highly goal-driven and assertive and so, Silvio should have been more patient
with them. Thirdly, Silvio should have been better prepared to handle uncertain events such
as the tariff hike impact as the Indian market is constantly evolving. Lastly, Silvio should
have avoided being over communicative as he then loses credibility before Indian employees.

Silvio should have been more proactive in escalating the issues to his superiors when the
European counterparts were not responding promptly. Top management interference could
have resolved this bottleneck and smoothened Schindler’s product introduction in this time-
sensitive market. By engaging more with the local talent pool, Schindler could have gained
further insights on the following: customers’ psychology, competition - Otis was a strong
competitor with high brand recall and how Schindler could strengthen its after-sales service
offering, while marketing S001 to customers. By constantly communicating with his Indian
team, Silvio could have avoided the acceptance of customized project in Mumbai. Although
his hiring was right, he shouldn’t have hired J. Jena as CFO, as she lacked core sector
experience. Jena should have accounted for all risk factors in sensitivity analysis so that
Schindler could not get financially derailed. For his strategy to succeed, Silvio needs to coach
his team, develop informal relations, respect the older team members and be open to learning.
Annexure 1:

India on the left, Switzerland on the right for each dimension.

https://www.hofstede-insights.com/product/compare-countries/

Hofstede’s Explanation
Dimensions
Power Distance Degree to which the less powerful members of a society accept and
expect that power is distributed unequally.
Individualism Preference for a loosely-knit social framework in which individuals
are expected to take care of only themselves and their immediate
families.
Masculinity Preference in society for achievement, heroism, assertiveness, and
material rewards for success.
Uncertainty Extent to which the members of a culture feel threatened by
Avoidance ambiguous or unknown situations and have created beliefs and
institutions that try to avoid them.
Long Term Every society has to maintain some links with its own past while
Orientation dealing with the challenges of the present and future
Indulgence Extent to which people try to control their desires and impulses