Understanding Operations Management through PGHR ‘09 - Group 8

2 Indian Premier League (IPL) – The Product Design Second to market – not the first mover advantage Parameters The Idea Not nations, but regional franchisees Based on the business model of European football leagues, that have very well-established franchisees like Manchester United Corporate participation in sports Till now, corporates were restricted to promotions during cricket Now, they can control the way they want to play cricket as well, while making money out of the entire process Foreign players rub shoulders with Indian players 4 foreign players per side can play in any match during the tournament Moreover, the IPL also requires atleast 2 under-22 Indian players Cricket is not the only Revenue stream Ground advertising rights, ground viewership revenue, corporate sponsorships, training academies, coaching camps, merchandize etc Extremely attractive for players, who are handsomely paid Players are tradable and can be bought by one franchisee from the other

3 Salient Features Quickly imitated the first-to-market league – ICL ; learnt from the shortcomings of the ‘rebel’ cricket league Focus more on league’s further development (enhanced product features) rather than doing the basic ground work Full of ‘Order- Winners’ ‘Second to Market’ strategy IPL is a ‘Make- to-Stock’ concept The Idea Cricket = Huge draw in India Bollywood/Entertainment = Huge draw in India IPL – Cricket + Bollywood/Entertainment + Others, making the league a huge ‘Order winner’ It is a good example of – ‘supply on demand’ League has been built in anticipation of demand

4 Salient Features The IPL is a breakthrough improvement over the other mediums - Test cricket and the 50- over format However, Incremental improvements have been continuously made in the other two formats −Example - Introduction of the ‘free hit’ concept in one-dayers −‘Power-play’ concept IPL - ‘Breakthrough Improvement’ 4 The Idea

5 Salient Features Test Cricket – 130-year old history; Loyal supporters not letting it die-down Twenty20 – Addresses modern-day realities; Global orientation; Success is guaranteed 50-over format – Still a major crowd-puller and forced to ‘mature’ faster

6 The IPL model aims at achieving a ‘strategic fit’… Line of fit Market requirements Operation’s resource capability IPL - High on competitiveness “At its heart, the IPL is all about the market. The concept is based not directly on cricket but on what the customer wants out of cricket”…………. Santosh Desai CEO, Future Brands “The operational decisions like auctioning process, franchisee ownership etc are well thought- out strategies, which support the market need”……….. Sundar Raman CEO, IPL

7 …by offering an excellent quality-cost combination to parties involved… High quality, Low cost Cost Quality Staging a memorable experience for the spectator Customized according to current realities High quality contests High-quality entertainment in less time Huge marketing platform for corporates at a reasonable cost Ticket prices at stadiums for every income-group

8 …along with benefits on other fronts as well Parameters The Idea Quality and Cost As discussed earlier, IPL offers an excellent quality-cost combination to spectators and corporates Speed Short duration of matches – in congruence with modern-day market requirements Dependability Regularly held during the first half of the year Venue was shifted to South Africa to address security concerns – The show did not stop Flexibility Is flexible upto the point it is possible In a crisis situation, the league can be held in other locations Viewers don’t have the choice of multiple formats of the game Cost Stadium tickets for every income-group Excellent platform for corporates to promote themselves at justified cost in comparison to other promotion alternatives

9 The location is at the centre of IPL’s success What makes the preferred destination for the IPL? What was a major reason why was chosen over… in the Indian Premier League-2? Location is a major determinant of revenue for service-oriented businesses High customer-contact is critical for success Costs are relatively constant for a given area; therefore, the revenue function is critical

10 Things to be further evaluated first before zeroing down on a strategy Balance between these factors make India the ideal location for holding the IPL

11 Things to be further evaluated first before zeroing down on a strategy Corporate patronage of regions, a large customer base were primary reasons behind the franchisee locations

12 Learnings

13 Thank You!