THE DECISION MAKING THEORY

Running head: DECISION MAKING THEORY IN THE GLOBAL MARKET- TATA
NANO
Decision Making Theory in the Global Market- Tata Nano
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DECISION MAKING THEORY IN THE GLOBAL MARKET- TATA NANO
Introduction
The Tata Group is a local Indian conglomerate and one of the popular vehicle
manufacturers in India. Tata Motors introduced its cheapest car ‘Nano’ in the Indian market
in January 2008. This decision of Tata Motors had driven unmatched public attention due to
stepping in a revolutionary step into the auto industry (Verma et al., 2019). The paper aims to
discuss the company’s decision regarding the launching of Nano. It will highlight the
company’s inspiration behind this decision, innovatively designed steps, issues, risk,
advantages and ethical leadership related to it in the automotive industry.
Discussion
India has a vast population and people residing there are billions in number. India is
the country where 1 million cars were sold in the year 2007. On the other hand, almost 7
million two-wheelers have been sold as compared to four-wheelers.
The inspiration of Tata Motors to Build the Nano
The owner of Tata Group ‘Ratan Tata’ got inspired to have people car like Nano
when he saw a family on the scooter. In that situation father was driving the scooter, his
young kid was standing after him, and his wife was sitting at the back withholding a little
baby. The whole situation made him think about the people’s safety, and affordability to have
a people car.
The strategy of the Tata signifies economic and realistic factors like; the income of
middle-class families can prefer this product due to reasonable price, family safety and
comfort (Jamal, 2018). Tata Motors was about to attract a large number of consumers by
manufacturing an inexpensive car for those who demoted to ride scooters or motorcycles.

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DECISION MAKING THEORY IN THE GLOBAL MARKET- TATA NANO
Innovative Steps Undertaken to Design the Nano
Tata Motors started the first step to proceed to succeed with the manufacturing of the
low budget car in India is through understanding the customer’s needs, wants, and purchasing
power that is their affordability. The company figured out the paying capability of its targeted
customers. The partners of the group also help to proceed for that challenge and manufacture
a $2500 car that would ultimately give return to all connected with the project with a small
profit (Murali, 2019). Tata recognized the basic features that a consumer needed to have in
their car and then it has been asked by their engineers and suppliers to manufacture such car
that has those basic specifications within the price tag of $2500.
Maintaining Quality Issues
The engineers and designers engaged with the manufacturing of low budget car
prepared the featured that would be in that model. They have added a smaller engine as
compare to the other cars due to the wastage of more horsepower in the crowded cities of
India, where the average speed tends to be 10-20 miles every hour (Singh & Joshi, 2017).
The Nano car has met overall Indian emission, pollution as well as safety standards even
though it would have a maximum speed of only 65mph. The car engineers have also keep
concerned about the fuel efficiency that is to be preferable for the economic driven customers
that are about 50 miles to the gallon. Tata Motors gained the credibility of its manufacturing
Nano by becoming a triumph of creativity and innovation.
Political Risk while Developing a Low Budget car in India
The political risk that Nano was faced while developing Nano is with its struggle with
the production site that purchased from the government of West Bengal. The case happened
as Tata Motors has planned to manufacture Nano in Singur as their production site. The