Strategic Management in Tata Motors

This report analyzes the strategic management of Tata Motors, focusing on their low-cost approach and the need for differentiation in the competitive automobile industry. It explores their organizational structure, value chain, and business level strategies. Recommendations are provided for future success.

STRATEGIC MANAGEMENT
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Executive Summary
Tata Motors Limited, India’s largest automobile company, is the leader by far in vehicles for
sale, and the second largest in the passenger vehicles market with attractive products in the
compact, average car, and service vehicles segments. Investigation indicates that Tata Motors
has positively enacted Low-Cost Approach by offering exceptional worth for its clients' money.
With over 50 years of familiarity, the business has positively attended to the diverse desires of its
clients by offering a wide variety of merchandises. Tata Motors is a co-founder in the R&D
division which lets it to continuously invent and invent first-hand expertise. Bearing in mind the
emergent economy and varying clients' expenditure, enactment of the Low-Cost Strategy may
not be beneficial ultimately. As a result, it is acclaimed that the corporate must shadow the
differentiation approach and concentrate on offering exceptional products to emerge the market
winner from the competitors. By bring innovative reforms in the market, it would not be unlikely
to reflect of a prospect where clients would voluntarily recompense for the extra worth to the
merchandise.

Table of Contents
Introduction......................................................................................................................................1
Fundamental Level Strategies..........................................................................................................3
Business Level Strategies................................................................................................................5
Conclusion.......................................................................................................................................6
Recommendations............................................................................................................................7
List of References............................................................................................................................9
Appendices....................................................................................................................................13

Introduction
Tata Motors, a supplementary of the Tata collection, was formerly referred to as TELCO (TATA
Engineering and Locomotive Company). The cluster gets its title from the forefather Jamseji
Tata and its head offices are situated at the Bombay House in Mumbai India. Established in
1945, Tata Motors has over 5 million vehicles driving on the roads in India (Shaffiula 2014, p.
83). It was the primary Indian business from the manufacturing segment to be recorded in the
New York Stock Exchange. It has managed to secure a position among the world’s top three
commuter automobiles manufacturers and is presently the frontrunner in business automobiles. It
similarly takes up the positions of the fourth biggest truck and subsequent leading bus maker in
the world.
The corporation has employed over 25,000 workers, who are directed by the idea to turn out to
be the greatest in its undertakings and merchandise whereas remaining unmoved with the
company principles and ethics scheme. Gregory (2019) asserts that the multinational company
frequently makes the business news headlines with the latest procurement of Jaguar Land Rover.
Currently, Tata Motors is the most talked about company in the automobile industry (Shafiulla
2014, p. 89). In the past few decades, it has come up as a low-cost automobile maker with a
primary emphasis on invention. In variance to its approach, it would be stimulating to get to
know on its novel projects in the extravagance market. The aim of this essay is to critically
evaluate the fundamental and business level strategies of the vehicle manufacturing in India
(Bonner 2017, p. 49). The exploration must enable us to evaluate the present besides the past
approaches of the corporate and restructure fresh approaches for supplementary optimization.

This report, therefore, focuses on closely analyzing and appraising its latest approaches and
substantiating for any scope of improvement.
For the implementation of this investigation, an exhaustive exploration of the obtainable
subordinate information was conducted. The collected information was confirmed with virtual
corporate accounts, official websites, and statements. Corporates internal statements assisted
with the analysis of its present rank by showing its incomes until 2017 and comprehending its
former actions and strategies. Data recovered from Factiva database, EBSCOhost database, and
e-books accessible online at University of the Sunshine Coast library and Google scholar proved
to be extremely useful. Reliable magazines, articles, government websites, statistical tendencies
and other useful online sources such as financial express, further enhanced the knowledge I had
on Tata Motors. The textbook "Exploring Corporate Strategy" by Gerry Johnson offered me the
basis to go about this task. Lecture notes and learning aid were likewise relevant information
sources.
Fundamental Level Strategies
Tata Motors being one of the biggest automobile industries globally requires an effective
organizational structure, which is upheld and observed unanimously. Tata Motors executive
personnel and partners are from various locations of the world. This shows that they are adopting
an international structure of organization where power is created and watches from the center
and then disseminated equally to all other supplementary segments of the organization. The
international organizational structure is becoming an essential element of governing and
leadership process for Tata Motors. The effects of international organizational structure include
kind of policy steering the company’s foreign operations; product multiplicity; range to which
the company is reliant on foreign sales; and structures used to manage international operations.

Leadership action is shared with various personalities from various parts where the company is
run and they are directed towards value intensification which brings all of them united and
becomes the section of internationally organized structure.
Tata Motors have exceptional capacities owing to its relative superiority in producing
inexpensive cars, which the competitors may not match up with. According to Gupta (2017), the
value series for Tata Motors begins with the Information Technology (IT) team's discovery as an
implement for company development. Inbound logistics like Tata Steel and Tata Power Co.
assist them to acquire economies of scale. Designing, assembling, manufacturing Kaizen, TPM
and R&D team's enables testing and packaging for improved operational output. To capture a
considerable market, it offers a range of heavy and light business, service automobiles, and
commuter cars. Tata distribution Company limited (TDCL) offers logistics backing for
dissemination. The business improved its fee on transactions and publicizing to guarantee the
knowledge on their new launches. Easily accessible centers, 24/7 IT Service desk and Tata AIG
Insurance and monetary amenities offer comfort to the clients. Tata continuously endeavors on
an invention by offering its workers with a room for advancement through cross-functional and
vocational training platforms. Its Human Resource (HR) course has been programmed for far-
reaching benefits. Tata Motors provides stiff competition to other actors in the automobile
industry with its sturdy inexpensive strategies such as the production of Tata Nano. These
outlines offer value for provision to clients.
Tata Motors has a unique manner of doing business, more deeply referred to as "The Tata way"
(Sharma 2016, p. 165). The most intense engraved principle in corporate is trust. The corporate's
logo "leadership with trust" signifies an individual's conviction in the trademark. Therefore, the
corporate esteems the reliance entrenched in it by countless and endeavors to live up to its

pledges. Supplementary five fundamental principles that support the Tata manner of undertaking
trade comprise unity, understanding responsibility, excellence, and integrity.
The business administration of the company comes from its gorgeous heritage of decent, just,
and open administration does shadowed for years, even afore they were made compulsory by
cultivating greatest criteria of decency, decent conduct, integrity, and professionalism (Nielsen
and Wilhite 2015,p. 385).
Knowledge and authority pass through a vertical hierarchy with the Chief Executive Officer
(CEO) being the foremost authority. The assistant chairperson of Tata Motors places utmost
significance to communication. He has a strong belief that verbal communication assists an
individual to comprehend the behavior outline. As a frontrunner, the body linguistic, style of
communication, and the manner of handling workers matter the most since the members perceive
and take their individual signs. Warm relations with employees permit stress-free course of
concepts, thus motivating greater productivity. Additionally, the company’s Code of Corporation
Disclosure Practices’ substantiates open declaration of its operations. Joshua (2017) affirms that
the company effectually incorporates better transnational HR management courses by holding
domestic administrators in the latest procurement and shifting a small number of administrators
from India. This makes adaption and exchange to different technology stress-free whereas
upholding the corporate's central values.
Value has continuously been the keystone of the Tata manner of trade; as such an official scheme
to measure the enactment of diverse businesses was initiated. TQMS assist corporates under the
Tata cluster to carry out and improve its commerce ventures particularly in relation to industry
ethics and excellence. Additionally, JRD Quality Value Awards christened after the late
chairperson of the cluster, JRD Tata was integrated for guaranteeing and stimulating quality

awareness. The accolade recognizes the corporate in the cluster that attains the uppermost degree
of value and surpasses value management. It enforce a culture setting that would, as a result,
assist attain headship in the marketplace by constantly endeavoring to become the best. Severe
partnership of corporate's philosophy has empowered it to effortlessly stick to its policy (Singh
and Shalender 2014, p. 157).
Business Level Strategies
In 2004, Tata Motors procured Daewoo Commercial Vehicle Company and renamed it as Tata
Daewoo Commercial Vehicles Co. Ltd. Shortly after, the new firm inaugurated its heavy duty
truck NOVEA in Korea. On 2nd June, 2008, the firm completed its procurement of businesses of
Land Rover and Jaguar for USD 2.4 billion. Procurement of both the company offered Tata
Motors access to the improvement, production and sale of high-quality luxury SUVs/car. This
procurement not only gave Tata Motors complete ownership over three main manufacturing
plants and two enhanced design centers in the United Kingdom, but similarly provided it with
access to an instituted global sales network. The procurement assisted Tata Motors to get control
over several intellectual property rights, brands and trademarks.
Risk of a new player: Emergent Indian market is drawing automobile businesses from around the
world. International car leasing organizations are posing a bigger risk with approximately twelve
trademarks, anticipated to get into the market (Barot and Chhaniwal 2017, p. 75). Conversely,
Tata Motors delights in economies of scale and degree of familiarity, therefore posing a
challenge for the new players.
The opposition amongst players: Indian vehicle industry is so competitive with three key actors
namely Hyundai, Tata Motors, and Maruti Suzuki. Hyundai and Tata Motors have about an

equivalent proportion of market chunk, yet less compared to Maruti Suzuki. Joan (2019) denotes
that a critical aspect, which stimulates rivalry, is that, all main automobiles suppliers are
extremely proficient to go after openings with antagonistic approaches.
Bargaining power of suppliers: The Indian automobile industry has seen strong development in
the course of 1995-2015, consequently making the automobile industry one of the most
developing industries. Escalated availability of sources of supply has decreased supplier's power
of bargaining. This may be observed in Tata Motors stretched backward and forward vertical
incorporation of its value series through procurement or making of steel, manufacturing and
retail undertakings.
Risk of alternatives: Automobile industry in India might fear the fast growth of communal
transport, most inexpensive and fast being metros.
Bargaining power of purchasers: Curtis (2019) asserts that rising disposable earnings and
availability of enhanced options have intensified the client anticipations and range of selection.
This has resulted in a decline in client loyalty towards a certain automobile trademark. Indian
clients are now delighting in the bigger power of bargaining.
This evaluation implies that four forces are sturdy enough to make this industry less appealing.
Nevertheless, in order to live on, Tata Motors has to carefully watch rival activities and react
faster to the variations in client desires and anticipations.
Conclusion
The research exhibits a promising prospect for the vehicle industry in India. Nonetheless, the
dynamic space for the growth of this market has enticed numerous actors. Existence of many
options and substitutes has further intensified clients' anticipations. Similarly, the expanding

adolescence market includes the alchemists, who want higher standards and fresh inventions in
their assets. All these studies offer Tata Motors to turn out to be more considerate to the needs of
the purchasers and guarantee implementation way ahead of the competitors. The company
should continuously examine fresh markets and guarantee firsthand innovations since the
possibility players are always the profit creators. Above and beyond the corporate may divide the
market and have something for everybody so as to seize a larger market share.
Comprehending the vast rivalry where each vehicle business is striving to turn out to be the
utmost choice for clients, Tata Motors has to create extra proficiencies. The trademark should
even out its status as a frontrunner in the business automobile market and put forward different
tendencies in the commuter automobile market. The proposed differentiation approach will offer
the business a foremost advantage through its cautious enactment and performance.
Recommendations
Tata Motors has continuously fought to be an inexpensive frontrunner in the vehicle market.
Therefore, by using Low-Cost Strategy, it has made its existence perceived particularly in the
unexploited and growing markets such as India. The best obvious example is that of the ultra-
cost Nano. On the other hand, with rising interest rates, fuel and raw materials cost the corporate
might be unable to keep up with this strategy in due course. All the same, business level analysis
proposes that economic development and increasing disposable earnings might escalate the
likely luxury automobile purchasers. Therefore, TATA's procurements of Jaguar Land Rover
appear to be a reasonable decision. Similarly, the ever-intensifying rivalry in the industry
necessitates Tata to enact differentiation approach. In regards to this approach, the corporate
should concentrate on delivering exceptional products to emerge the winner against the
competitors as put forward by Raymond (2016). In return, the company will enjoy the first-rate

cost that the clients would readily recompense for the extra worth to the merchandise.
Performance of this approach may be beneficial for Tata Motors if it appropriately reflects the
subsequent-
Strategy Implementation
Make a fuss of antagonistic R&D to guarantee inventions that may increase the product’s value
at the lowest price. This comprises forming refined attractive models.
Adopt workable practice and preserve constructive affiliations with every member of the value
series and continuously enhance their awareness by stimulating a culture setting.
Carry out research to keep the business up-to-date with the current wants of the purchasers and
address them well ahead of the rivals.
Reagan (2019) proposes that increasing awareness of global warming and ever-rising energy
costs will perceive a development in the green car segment. Therefore, an addition of a super
effective locomotive and environmentally responsive automobiles to the corporate's range will
gain a larger share of the market.
Taming the Financial Plan
Irrespective of the increased renumerations, the business should center on doing away with
considerable debts and stay away from deals that can lower their credit value.
Focus on bettering world sales for faster reclamation of a fixed price.
Outsourcing
According to Robert (2019), outsourcing small tasks is worth the expenditure at it enables the
corporate to concentrate on important tasks necessary to encourage motivation.

Guaranteeing Improvement
Breuer and Upadrasta (2017) allude that the company should inspire interaction concerning the
supply chain associates for improvement of the market demand and faster provision, therefore
steering efforts towards the enhancement of production time series.
Promotion personalization, where purchasers may personalize their automobiles according to
their desires. This may be an attraction for experimenters.
Capturing a bigger portion of the market by presenting differentiated models with different costs
for every portion.

List of References
‘“Tata Motors Limited Q1 2018 Earnings Conference Call” August 09, 2017’ 2017, Ace
Analyser: Conference Calls, pp. 1–12, viewed 22 April 2019, Retrieved from
<http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=124732166&site=ehost-
live>.
‘Q1 2019 Tata Motors Ltd Earnings Call - Final’ n.d., Fair Disclosure Wire (Quarterly Earnings
Reports), viewed 22 April 2019, Retrieved from <http://search.ebscohost.com/login.aspx?
direct=true&db=bwh&AN=32U3671274617FDW&site=ehost-live>.
‘Tata Nano failed customer aspirations in totality: Maruti Suzuki Chairman R C Bhargava’
2016, FRPT- Automobile Snapshot, p. 5, viewed 22 April 2019, Retrieved from
<http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=121072325&site=ehost-
live>.
2018, ‘The Evolution of Business Groups’ Corporate Social Responsibility’, Journal of Business
Ethics, vol. 153, no. 4, pp. 997–1016, viewed 22 April 2019, Retrieved from
<http://search.ebscohost.com/login.aspx?direct=true&db=eft&AN=133588457&site=ehost-
live>.
Barot, H & Chhaniwal, P 2017, ‘Tata Nano to Nano Twist: The study of Business and Marketing
Challenges’, Journal of IMS Group, vol. 14, no. 2, pp. 69–79, viewed 22 April 2019, Retrieved
from <http://search.ebscohost.com/login.aspx?
direct=true&db=buh&AN=128836622&site=ehost-live>.
Bonner, M 2017, ‘Case Study: Making Automotive Sealers Behave’, Adhesives & Sealants
Industry, vol. 24, no. 3, pp. 44–51, viewed 22 April 2019, Retrieved from

<http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=121896781&site=ehost-
live>.
Breuer, H & Upadrasta, V 2017, ‘Values-Based Product Innovation -- The Case of Tata
Nano’, Proceedings of ISPIM Conferences, pp. 1–18, viewed 22 April 2019, Retrived from
<http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=124004846&site=ehost-
live>.
MarketLine Company Profile: Tata Motors Limited 2019, Tata Motors Limited MarketLine
Company Profile, 15 February, pp. 1–56, viewed 22 April 2019, retrieved from
<http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=135533339&site=ehost-
live>.
Nielsen, KB & Wilhite, H 2015, ‘The rise and fall of the “people’s car”: middle-class
aspirations, status and mobile symbolism in “New India”’, Contemporary South Asia, vol. 23,
no. 4, pp. 371–387, viewed 22 April 2019, Retrieved from
<http://search.ebscohost.com/login.aspx?direct=true&db=aph&AN=113739947&site=ehost-
live>.
Shafiulla, B 2014, ‘Tata Nano to Tata No-No’, IUP Journal of Marketing Management, vol. 13,
no. 1, pp. 78–86, viewed 22 April 2019, Retrieved from
<http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=95118759&site=ehost-
live>.
Sharma, RK 2016, ‘Developing Models to Predict the Stock Prices of Indian Automobile Giant
Tata Motors Company Limited: An Empirical Analysis’, Finance India, vol. 30, no. 1, pp. 153–

172, viewed 22 April 2019, <http://search.ebscohost.com/login.aspx?
direct=true&db=buh&AN=116874805&site=ehost-live>.
Singh, N & Shalender, K 2014, ‘Success of Tata Nano Through Marketing Flexibility: A SAP-
LAP Matrices and Linkages Approach’, Global Journal of Flexible Systems Management, vol.
15, no. 2, pp. 145–160, viewed 22 April 2019, <http://search.ebscohost.com/login.aspx?
direct=true&db=buh&AN=95993834&site=ehost-live>.
Appendices
1. Taylor 2011
2. Tata Motors 2017
3. Business India Intelligence 2015
4. The Economic Times 2016